For the average person, it is tempting to assume that nothing carries more weight in law than a properly prepared legal document, with perhaps the most obvious example being the will a person leaves behind after their death.
Although wills may sometimes be contested, it is generally the details of the will being challenged, or the conditions, not to mention state of mind, under which it was written.
The primacy of the written document is generally taken for granted, but the principal of ‘estoppel’ runs counter to this assumption, as demonstrated in a recent case involving the ownership of a £2.5 million estate and the future living conditions of an 82 year old widow.
Where there’s a will
The case of Habberfield v Habberfield illustrated the impact that estoppel or more accurately on this occasion, proprietary estoppel can have.
This case revolved around the Woodrow Farm farming business, which had been run by Frank and Jane Habberfield since the 1970s.
When Frank died in 2012 the entirety of the £2.5 million estate passed to his wife Jane. However, their daughter Lucy, one of four children, came forward to claim proprietary estoppel on the basis that both parents had told her she would take ownership of the farm when they retired – she had spent 30 years working with the dairy herd while also getting married and having a family of her own.
Jane Habberfield denied this claim, but when the case was first heard in February 2018, Lucy was awarded a cash sum of £1.7 million to be paid immediately, an amount chosen to represent the value of her share of the land.
Although the farmhouse in which Jane Habberfield lived wasn’t included in the settlement, it would have to be sold to raise the funds, so she appealed against the judgement on the grounds of fairness, but in May of this year the England and Wales Court of Appeal upheld the original decision.
To give an indication of the burden of proof required in a case of proprietary estoppel, the judge handling the original case found that:
Jane Habberfield also argued that she and her husband made Lucy an offer in 2008 that would have seen her receive a viable dairy farm, but Lucy turned the offer down. Jane therefore claimed that it was reasonable for Frank and Jane to ignore their earlier assurances and defeat Lucy’s rights under proprietary estoppel.
The clearest lesson to take from this case is given the right circumstances, verbal promises can have all the legal force of the most carefully drafted documentation. Whichever side of the matter you find yourself on, you will require professional legal advice from experienced lawyers, well-versed in the mechanics of estoppel in all its forms. However, Proprietary Estoppel should be no substitute for a properly-documented legal agreement such as (in this case) a Farming Partnership and Wills made by all parties so as to avoid the inevitable costs and emotional fall-out of a family dispute and litigation.
If you would like to discuss your needs or those of a family member or friend in more detail, please contact Adam Penn, an Associate Director in our Wills, Probate and Trusts team by email email@example.com or by phone on 01543 431 196
Although it sounds a typically legal expression, in the simplest terms, estoppel is merely a judicial device used to prevent an individual from reneging on something they had previously promised.
It can also be used to prevent someone from making claims that run counter to the impression their previous actions might have given. As you might expect from a principle which undercuts the basis of most contract law, there are strict conditions to be met if estoppel is to be applied.
In this particular case, the issue revolves around proprietary estoppel, which means that the promise in question centred upon the ownership of property or land.
The majority of these cases take place when a person dies and leaves arrangements for the disposal of property in a will, only for another party to come forward and claim that the stipulations in the will run contrary to something the deceased had previously promised.
Of course, simply stepping up and stating that your millionaire uncle once said you could have his classic Ferrari when he died isn’t going to be good enough.
For a case of proprietary estoppel to be upheld – in other words, for an arrangement to be overturned on the basis of promises made earlier – certain conditions have to be met.
In plain English, these conditions are: