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Farmer wins claim over deceased relative’s farm

15 July 2009

We have reported before on a case in which the courts applied a remedy known as proprietary estoppel. This is a means by which property rights may be affected or created. Simply put, it allows courts to interfere in cases where they feel that to apply strict legal rights would be unfair or unjust. The same principle arose recently in a dispute over the inheritance of a family farm.

 

The Case

  • The facts in Thorner v Majors were fairly straightforward. David Thorner was a farmer who, for 29 years, worked without pay on a farm at Cheddar, owned by his father’s cousin, Peter.
  • From 1990 to the time of his death in 2005, Peter encouraged David to believe that he would inherit the farm. For example, in  1990 he handed David two assurance policies on his life saying “that’s for my death duties”.
  • Peter Thorner made a will in 1997 which made his intention clear but he later revoked it and did not make another one before he died in 2005. Without it, his sisters and a niece stood to inherit the entire £2.3 million estate. David issued proceedings claiming a beneficial interest in the farm under the doctrine of proprietary estoppel.

The Result and Appeals

  • The claim was initially successful. In the judge’s view, by various indirect remarks and conduct, Peter had encouraged David’s expectation that he would be Peter’s successor. It was ordered that David should receive the land, buildings, live and dead stock and other assets of the farming business but should indemnify Peter’s personal representatives in respect of the IHT payable on the farm.
  • The first decision was reversed by the Court of Appeal who said that Peter’s indirect remarks and conduct were not sufficiently clear and unequivocal to establish any proprietary estoppel in his favour. It was also noted that the trial judge had not found that Peter intended David to rely on his assurance and there was no material on which the trial judge could have made such a finding.
  • The case then went to the House of Lords, who found in David’s favour and reinstated the order made in the first instance. Lord Hoffman said that the fact that Peter had actually intended David to inherit the farm was irrelevant. The question was whether his words and acts would reasonably have conveyed to David an assurance that he would do so.

Supreme Court Judgements

  • Lord Hoffmann said that, in the circumstances, the judge had been right to find David could have reasonably relied on Peter’s words and acts.
  • Lord Walker said that to establish proprietary estoppel, the relevant assurance must be sufficiently clear.
  • The context and circumstances of the case were quite unusual. There had been a lot of evidence about two countrymen leading the sort of lives that many city-dwellers would find hard to imagine. These were taciturn and undemonstrative men committed to a life of hard and unrelenting physical work, by day and sometimes by night, largely unrelieved by recreation or female company.
  • Lord Walker said that the judge had been right to consider that Peter’s assurances, objectively assessed, were intended to be taken seriously and to be relied on.
  • He and the other four law lords allowed David’s appeal, overturned the Court of Appeal’s decision and restored the first instance judge’s order.

 

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Nigel Whittaker BA (Hons)
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