This case arose as a result of a dispute between family members in respect of the family's dairy farm in Netherton, West Yorkshire.
The Claimant alleged that her mother (the first Defendant) had promised her in 2002 that, if farmland was sold, the proceeds of sale would be shared equally between the mother and her five children (of which the Claimant was one). The Claimant also said that her brothers (being the second and third Defendants respectively) had been well aware of the promise made.
The Claimant argued that, in reliance on that promise, she had undertaken work to remove a "green belt" designation from 40 acres of land on the farm, which had secured its allocation for housing development and significantly increased its value. The land was subsequently released from green belt designation in 2015 and identified as being suitable for 250 new homes.
A dispute arose when the land was sold for around £9 million to a housing developer by the Claimant's mother and brothers.
The Claimant claimed that her mother and brothers knew that she would not have spent so much time (some 550 hours between 2008 and 2018) and money (£6,000) on the work she undertook to remove the green belt restriction, if it had not been for her reliance on the promise made by her mother (of which her brothers were aware). She therefore asserted that the Defendants should be estopped from denying her a share of the proceeds of sale.
The Court rejected that there were sufficient grounds to establish proprietary estoppel. The Court reviewed the requirements for proprietary estoppel, noting that there needed to be a clear assurance, reliance by the Claimant on that assurance, and detriment to the Claimant as a result of that reasonable reliance. The Claimant had failed to demonstrate that her mother had made a sufficiently clear promise as to the division of the sale proceeds and as a result it followed that, in the absence of a sufficiently clear promise, the Claimant could not have relied on any such promise. The issues of reliance and detriment therefore did not arise.
However, the Court did allow a claim for unjust enrichment. The Court held that the Claimant's brothers had been unjustly enriched as a result of the work undertaken by the Claimant to remove the green belt restriction, such that it could be allocated for residential development. The Claimant had not done that work without expectation of reward, but her mother and brothers had freely accepted her services and therefore been unjustly enriched at her expense. The Court therefore awarded the Claimant £652,000 calculated as a commission of 7.5% of £8.7 million (being the uplift of the value of the land due to her work, from £300,000 to £9 million).
Family and farming circumstances can sometimes lead to allegations of proprietary estoppel due to family members often working on the farm for a low or nil wage, or undertaking acts, in anticipation of inheriting certain parts of the farm or benefiting from their disposal. It is therefore important to ensure that intentions are clearly reflected in succession planning, to avoid ambiguity where possible. However, proprietary estoppel claims can often be very fact-specific and the Court in this case was quick to caution against treating of the legal tests as a "straightjacket", indicating that the Court will need to undertake a detailed inquiry as to the circumstances arising in each individual case.
