a7AP - Essay RP NEW POD

Debate: The unconscionability debate: Scott LJ (Cobbe): unconscionability cannot be the sole basis — the other requirements must be met independently. Walker LJ (Cobbe/Thorner): unconscionability 'unifies and confirms' the other elements but is not a separate free-standing requirement. The practical question: does unconscionability add anything beyond the three requirements? Walker LJ suggests it is relevant at the remedial stage as a check on proportionality. Hopkins: Walker's de-emphasis of unconscionability in Thorner signals a move towards more formal requirements. This tension is directly tested in the TT24 Q3 essay ('should we abolish PE?').

Case

Facts

Proposition

★  Thorner v Major [2009]

Facts: Thorner worked for 30 years unpaid on cousin Peter's farm. No explicit promise, but Peter gave David a bonus notice on 2 life assurance policies saying 'That's for my death duties.'

·       Peter made and then destroyed a will leaving the farm to David.

·       David claimed PE.

HL - Lord Walker: PE 3 elements:

(1) assurance or representation;

(2) reasonable reliance;

(3) detriment in consequence.

Assurance 'must be clear enough' — but clarity = 'hugely dependent on context.'

Neuberger: assurance need not identify the precise extent of property in every case

Full farm awarded.

◆ Past paper: Facts tested in TT21 Q11 (Timothy/Ursula) and form the template for almost every PE problem. Know the indirect/contextual assurance point — it is always tested.

★  Cobbe v Yeoman's Row Management Ltd [2008]

Facts: Property developer (C) and landowner (YR) - oral agreement: C obtain planning permission; YR would sell the land to C for £12m, splitting profits above £24m. After C obtained planning permission at expense, YR withdrew

TAKEAWAY: PE cannot be grounded on unconscionability alone need required ingredients

Key: both parties knew there was no legally binding contract.

Courts should be slow to introduce uncertainty into commercial transactions.

⚠ Examiner (TT25) Q7: Clive's situation is the opposite of Cobbe — an informal family/social context, not a commercial negotiation. The Cobbe/Thorner distinction is always needed in PE problems.

◆ Past paper: Cobbe/Thorner distinction is the key issue in every PE problem question.

★  Davies v Davies [2016]

Facts: Family farm dispute.

Proposition: Lewison LJ [38]: (1) PE is fact-sensitive; (2) assessing how to satisfy equity is a retrospective exercise from when the promise falls due — would it be unconscionable not to keep it? (3) Three elements needed but not watertight compartments; (4) detriment need not be financial 'so long as it is something substantial'; (5) sufficient causal link required between assurance and detriment; (6) detriment judged at the moment of repudiation; (7) proportionality between remedy and detriment required — but this does not mean abandoning expectations; (8) broad discretion but not 'unfettered.'

★  Guest v Guest [2022]

Facts: Andrew worked on parents' farm for 20+ years at minimal wages in reliance on assurance he would inherit 'viable' part of farm. Family dispute; Andrew removed from will.

HC awarded 50% business + 40% farm (probably requiring a sale).

By virtue of its nature as an equitable remedy, remedial action for proprietary estoppel will be more flexible than common law remedies. 

TAKEAWAY: correct approach to framing a remedy is based on Andrew’s expectation of inheritance rather than the detriment-based approach put forward by his parents

UKSC majority (Briggs LJ): starting point is expectation — hold the promisor to the promise.

·       The aim is to remedy the unconscionability caused by repudiating the promise, not merely to compensate detriment.

·       A discount for early receipt ('acceleration') must be applied where the promise was conditional on the promisor's death.

Parents given choice:

(1) reversionary trust of 40% of farmland value (life interest for parents, remainder to Andrew); or

(2) immediate discounted cash payment.

Leggatt LJ (minority): either compel performance OR compensate detriment — not the majority's hybrid.

an approach focused on remedying unconscionability;

provides no yardstick for deciding when it is appropriate to award something other than what was promised (or its value) or for deciding what that something else should be.”

Briggs LJ suggests calling PE a 'property expectation claim' to avoid estoppel confusion.

⚠ Examiner TT25 Q7 (Clive): Guest v Guest governs the remedy. Know both the majority approach (expectation-led) and the Leggatt dissent (detriment-led). The 'acceleration' point and the choice of remedy forms are frequently tested.

◆ Past paper: The remedy in Guest v Guest governs every PE problem since 2022. Know the majority approach, Leggatt's dissent, and the acceleration discount.

Case

Facts

Proposition

★  Gillett v Holt [2001]

Facts: Gillett worked for Holt's farm for 38 years after multiple assurances from Holt (‘1 day you will own the farm').

·       1995 Holt sacked Gillett and altered his will.

·       Gillett claimed PE.

HELD: The express promises were sufficiently certain to establish an estoppel

·       G awarded freehold of farmhouse and some land and 100k to compensate him for his exclusion from the farm business

Walker LJ:

1.Detriment is 'not a narrow or technical concept' — need not be financial 'so long as something substantial.'

2.Countervailing benefits (e.g. Gillett lived in the farmhouse rent-free) must be weighed but don’t automatically negate the claim.

3.Whether detriment is sufficient depends on whether it would be 'unjust or inequitable to allow the assurance to be disregarded.'

4.Detriment is judged at the moment of repudiation.

◆ Past paper: The facts of Gillett are very close to the TT21 Q11 (Timothy/Ursula) and TT23 Q11 (Ben/Chloe) scenarios. Know the 'judged at moment of repudiation' test and the countervailing benefits analysis.

★  Thorner v Major [2009]

1.Relevant assurance must be clear enough

- But sufficient clarity depends on context

2. Promise must be unambiguous and must appear to have been intended to be taken seriously. Taken in its context, it must have been a promise which one might reasonably expect to be relied upon’

(Hoffmann LJ in Walton v Walton, adopted).

Lord Hoffmann: irrelevant that the promisor subjectively intended the promisee to inherit

Lord Scott: once reasonable reliance is shown, ordinarily not open to the representor to assert they did not intend reliance.

★  Cobbe v Yeoman's Row [2008]

Facts: Commercial negotiation. Both parties knew no binding contract existed.

TAKEAWAY: a commercial negotiation where both parties know theres no legally binding contract & are free to walk away is not an assurance sufficient for PE.

‘court should be slow to introduce uncertainty into commercial transactions’

Contrast Thorner: Cobbe had uncertainty as to the nature and terms of any benefit; Thorner had no doubt as to the subject of the assurance (the farm itself).

On unconscionability: C cannot bypass PE requirements by reference to unconscionability alone

Hopkins: Walker LJ's de-emphasis of unconscionability in Thorner suggests a move towards formal requirements.

★  Wayling v Jones (1993)

Facts: W worked at J's business for tiny pay in a long-term relationship. J promised W the hotel; later bought a different one and promised that to W instead. J died intestate leaving nothing to W.

TAKEAWAY promises need not be 'the sole inducement'

Once promises established, burden of proof shifts to D to establish C didn’t rely.

-        Causal link test (adopted, Davies v Davies): a 'sufficient causal link' between assurance and detriment needed

Cooke criticises Wayling — W could not meet the 'but for' test in any normal sense; he did not set up home with J in the belief he would inherit. The case is therefore an oddly generous application of the reliance requirement.

Greasley v Cooke [1980

FOR PQ: once assurance + detriment-type conduct is shown, the burden shifts to D to disprove reliance.

Debate: Cobbe/Thorner distinction — the central issue in all PE problems:

Cobbe = commercial negotiation, both parties know no contract exists, pre-contractual uncertainty → no assurance sufficient for PE.

Thorner = informal family/farm context, no explicit promise needed, contextual clarity sufficient → assurance found.

-        Q in every problem is which side of the line do the facts fall? Key factors:

(1) commercial vs personal context;

(2) whether both parties knew no legally binding agreement existed;

(3) whether there is certainty as to the subject matter of the assurance (not necessarily its precise terms).

✎ Luke (tutor): The effect of a successful PE claim is to confer on the representee an equitable right to have the assurance / equity satisfied, in a way that the court will determine by exercise of judicial discretion.

Case

Facts

Proposition

★  Jennings v Rice [2003]

Facts: Jennings worked as Mrs Royle's part-time gardener and later unpaid carer in return for her assurance she would 'see him right.'

·       She died intestate leaving a £1.285m estate. Jennings claimed the whole estate or at least the house (£435,000).

TAKEAWAY: 'most essential requirement is that there must be proportionality between the expectation and the detriment.'

-here £200,000 was awarded (the detriment, roughly quantifiable).

LONGEVITY: Jennings relied upon by both majority and minority in Guest v Guest:

-        Briggs LJ uses it to show that the court should start with expectation and reduce; the £200,000 was not 'out of all proportion.'

-        Contrast Guest: Here - detriment was of a 'life-long' nature where no such reduction was appropriate.

◆ Past paper: Jennings v Rice is the comparator for every PE remedy question. The proportionality principle is always required. Post-Guest: start with expectation; Jennings shows when reduction is warranted.

★  Guest v Guest [2022]

UKSC remedy decision.

TAKEAWAY: correct approach to framing a remedy is based on Andrew’s expectation of inheritance rather than the detriment-based approach proposed by parents

HELD: entitled to inheritance bc parents

repudiated on promise that 1 day Andrew would inherit a share of the farm

only if enforcement would be out of all proportion to detriment.

BRIGGS (Majority) Start with expectation, & move along the ‘spectrum’

§  Outlined 2-stage approach to remedy unconscionability caused by broken promise:

1)     Establish the ‘equity’ – to determine whether the promise repudiation is unconscionable in light of the promisee’s detrimental reliance

2)     REMEDY/Satisfy the equity - start with the assumption that the promisor should be held to his promise (may be reasons why something less than full performance will negate the unconscionability caused)

§  'Acceleration' discount must be applied where the promise was not yet due.

Leggatt LJ (minority): EITHER compel performance OR compensate detriment — the majority hybrid creates uncertainty.

All SC agreed: detriment alone cannot be the controlling factor in framing the remedy.

◆ Past paper: Guest v Guest is now the governing authority on remedy. Every PE problem since 2022 requires: (1) majority approach (expectation-led); (2) Leggatt's dissent (detriment-led); (3) the acceleration discount; (4) the choice of remedy forms. The TT24 Q3 essay also requires engagement with Briggs LJ's critique of the term 'estoppel.'

Guest v Guest - huge academic debate:

McFarlane: the Guest v Guest lack of sympathy towards the detriment view arguably spills over into the question of whether there is a PE claim available or not. If we don’t care about detriment, then why are the claimants here

succeeding in their action?

Briggs REJECTED BOTH the McFarlane (detriment-only) and the promise-enforcement approaches: the court must deal with the unconscionability of repudiating the promise. But WHAT DOES THIS ACTUALLY MEAN? Leggatt LJ's concern about uncertainty is well-founded — Briggs LJ's 'spectrum' gives little practical guidance.

★  Winter v Winter [2024]

Facts: Successful PE claim re a farm. Argued that A and R suffered no detrimental reliance, having made £2 million from their work — real contrast to Thorner v Major.

TAKEAWAY: no need for C to point to something specific they gave up to carry on working the farm.

·       Sufficient to establish a 'sufficiently substantial net detriment.'

RAISES Q: if Guest v Guest's majority suggests we focus on loss of expectation rather than detriment, does detriment become less important to establishing the equity?

Consider how strange s116 is: just because you have relied on something to your detriment, you now have a protected right against the world. This is a significant expansion — a mere equity, arising from personal reliance, becomes capable of binding successors in title simply by virtue of the statute.

The question of whether this is justified depends on whether PE is best understood as a property right or a personal right against the promisor.

Henry v Henry [2010]

ON ASSESSMENT OF DETRIMENT: In assessing whether a proprietary estoppel arose, the judge should have compared the advantages C had obtained to the detriments

-        The fact that C had lived rent-free on a plot of land, living off its produce and the sale of any surplus does not outweigh the detriment that C suffered as he had ‘effectively deprived himself of the opportunity of a better life elsewhere.’

⚠ Brake v Swift [2020]

Candidates needed to discuss both section 116 LRA 2002 and McFarlane’s [2003] CLJ argument that this provision should only apply to property rights properly-so-called acquired via estoppel, eg, the estoppel easement in Crabb v Arun DC, and reasoning of HHJ Paul Mattews in Brake v Swift.

Case

Facts

Proposition

★  Cobbe v Yeoman's Row [2008]

Lord Scott (obiter)

Equity 'can surely not contradict the statute.' PE cannot be used to render enforceable an agreement that statute has declared to be void.'  

★  Thorner v Major [2009]

→ PE allowed if it is a non-contractual assurance
→ s2 only bites where there is a “contractual connection”

★  Farrar v Miller [2018]

a free-standing PE claim would not frustrate s2's policy.

Kitchin LJ: a free-standing PE claim would not frustrate s2's policy.

-        The Law Commission's policy behind s2 was to increase certainty in contracts—not to exclude equitable remedies like PE.

Would be odd if s2 'only precluded PE where there was some sort of contractual connection' (echoing Thorner).

Lord Neuberger (extrajudicial): the clearer and more precise the defendant's promise, the stronger the PE claim in principle — and the more likely s2 would defeat it. This would be perverse.

★  Stack v Dowden [2007]

Lord Walker: PE & CTs shouldn’t be assimilated

PE = involves “asserting

an equitable claim against the conscience of the ‘true’ owner”, and the equity is to be

“satisfied by the minimum award necessary to do justice”

CT is about “identifying the true beneficial owner(s), and the size of their beneficial interests.”

👉 Different roles — not interchangeable

★  Thorner v Major [2009]

Facts: Lord Scott considered whether constructive trusts could substitute for PE in cases of informal representations about future interests.

Lord Scott: Suggests:

-Use constructive trusts for future/inheritance promises

-Keep PE separate

Lord Walker: Pushback:

CTs don’t really fit these cases

• BUT admits: On facts, a REMEDIAL CT could arise

BUT I THOUGHT THAT THERE WERE NO REMEDIAL CONSTRUCTIVE TRUSTS IN LAW?!