A leading set specialising in commercial, construction, insurance and property law
An Ounce of Performance is Worth Pounds of Promises
Screen siren, Mae West, as witty as she was glamorous, is said to have quipped that: “An ounce of performance is worth a pound of promises”.
Whilst, Ms West no doubt had other matters in mind, it seemed an appropriate title for an article considering two recent proprietary estoppel cases of interest in which promises, coupled with an ounce or two of performance in the form of detrimental reliance, certainly sounded in pounds for one of the claimants:
It also seemed a fitting title given the divergence in the case law as to the approach to be taken to remedy in proprietary estoppel cases and the role of proportionality in evaluating whether or not the performance (or detriment) on the part of the successful claimant should lead to the award of what was promised to them, or some lesser award. The question of whether or not there needs to be a relationship of proportionality between the level of detriment and the relief awarded, is a controversial one. The controversy stems from the fact that the conceptual basis of proprietary estoppel is not wholly settled: is the object of the doctrine to award a remedy that gives effect to the promises made, or is the remedy focused on compensating the detriment suffered by the promise?
Putting it another way, when the court decides how to remedy the estoppel that has arisen, it must ask itself whether or not an ounce of performance is in fact worth a pound of promises (or the pounds that have been promised).
Both of the cases concern the almost ubiquitous family farm. Family run farms offer fertile ground for proprietary estoppel challenges for a number of reasons. The chief reasons, in my view, being:
The essential ingredients of the doctrine that a claimant must demonstrate to establish that an estoppel has arisen, as set out by Lord Walker in Thorner v Major  1 WLR 776 , are as follows:
James v James  EWHC 43 (Ch)
The claimant, Sam, in James v James was the son of the deceased, Charles James. The subject matter of the proprietary estoppel claim was the deceased’s farm in Dorset.
The case was decided by HHJ Paul Matthews.
Sam’s case was unsuccessful, in HHJ Matthews’ judgment, on each of the essential ingredients of the doctrine of proprietary estoppel.
Promises or assurances
There had been occasions where Sam’s father, Charles, had told Sam what his testamentary intentions were. But a statement of current intentions as to future conduct is not a promise of that conduct, let alone a promise intended to be acted upon. Making a will in favour of someone is not the same as promising to leave property to that person. It is ambulatory, merely a statement of current intention, and can be changed at any time.
The high point of Sam’s case in relation to an assurance was his evidence that, before buying further land the deceased had asked Sam whether he should buy it, because (as Sam put it) “I would be farming it one day“. HHJ Matthews accepted that the deceased had said words to this effect to Sam, at least twice.However, these comments needed to be considered in the context of the personalities of the individual in question.
Sam’s evidence had been that Charles wanted to keep all the assets in his own name as long as possible, and, although he liked to make decisions, he would not make them until he was good and ready. He had stated in evidence that he did not accept that Charles would give away any of his land during his life. Charles did not easily make promises to transfer property, let alone actually transfer any of it. To Charles, “money was God.”
Against that background, the comments made by Charles James did not amount to a promise or assurance to leave the property to Sam. Really, these comments reflected nothing more than him acknowledging that one day he would die and would have to pass the land to the next generation and, at the time that he made these remarks, Sam was the obvious person to leave it to. Statements of intention of this sort are not promises intended to be acted on. HHJ Matthews remarks :
Detriment and reliance
Sam’s case further lacked the necessary reliance and detriment to found a proprietary estoppel.
Sam could not demonstrate sufficient detriment. This was not the classic proprietary estoppel scenario where a claimant works for nothing, or very little, on the strength of assurances that they would inherit the farm. Sam had been properly paid the going rate for farm work, had been bought cars (which had been shown in the business accounts as ‘bonuses’), had occupied a property rent-free, had been made a partner in the family business and in time had received some land, cash and a haulage business.
There was further no evidence of reliance. Sam had not ever thought seriously about going away to make his fortune in some other industry or occupation.
Relief: expectation, detriment and proportionality
Given all of the above, the question of how to approach the relief to be awarded was not a live issue in James v James. Nonetheless, HHJ Matthews did express his view on the relevance of proportionality, comparing views expressed by the Court of Appeal in Davies v Davies  EWCA Civ 463 with those expressed in Suggitt v Suggitt  WTLR 1607:
In Davies, Lewison LJ appeared to endorse a suggestion put forward by counsel in that case that there should be a sliding scale approach, whereby greater weight would be given to expectation in cases where there is a clearer expectation, greater detriment and a longer passage of time during which the expectation was held.
In Suggitt (which was cited in Davies), at  Arden LJ referred to the judgment of Robert Walker LJ in Jennings v Rice  EWCA Civ 159, where he had said that, rather than to simply fulfil the claimant’s expectations:
“if the claimant’s expectations are uncertain, or extravagant, or out of all proportion to the detriment which the claimant has suffered, the court can and should recognise that the claimant’s equity should be satisfied in another (and generally more limited) way.” Commenting on this statement, at , Arden LJ said that this: “does not mean that there has to be a relationship of proportionality between the level of detriment and the relief awarded“.
HHJ Matthews, for his part, comes down on the expectation fulfilment side of the debate stating as follows:
“51. For what it may be worth, I agree with what Arden LJ said. Proprietary estoppel is a doctrine which, like the law of contract, focuses on expectations created rather than losses suffered. So if A promises B some property right, intending B to rely on this, and B does rely on it to B’s detriment, the natural impulse is (as with contract law) to require A to make good the expectation. Making the remedy proportionate to the detriment suffered would be to focus more on what B has lost, rather than on what B expected to obtain.
52. But of course proprietary estoppel is not as strict as contract law. It is also an equitable doctrine, and therefore tempered by conscience. So there may be exceptional cases where (as Robert Walker LJ said) it is just not right to require A to go the whole length of satisfying the expectation created. In those cases, there may be another way to satisfy the equity raised, without however necessarily requiring the remedy to be proportionate to the detriment. For myself I respectfully doubt how far a “sliding scale” approach would be useful. Just as a contract is either made and broken or not, either the promisor has created an expectation, on which the promisee has relied to his or her detriment, or not.”
It would appear from the above, that HHJ Matthew’s preference is for awarding the claimant’s expectation, unless the case is an exceptional one.
Habberfield v Habberfield
The dispute concerned a family farm in Somerset. The Claimant, Lucy, was one of the four children of the deceased, Frank Habberfield. The farming business had been operated as a partnership between Frank and his wife, Jane. The main business had been dairy farming, however that had ceased when Lucy had departed from the farm following a disagreement with other family members.
The case was decided by Mr Justice Birss.
Promises or assurances
Birss J found that the following representations had been made to Lucy:
Whilst some of these statements related to the operation of the business, rather than ownership of the farm property, Birss J concluded that, taken as a whole, they did amount to assurances that the farm business and land would be Lucy’s one day. Birss J concluded that the statements in this case, in contrast to those in James, were in the form of assurances that, in return for what Lucy was being asked to do now, she would receive something in the future.
Birss J heard expert evidence on the question of the remuneration that Lucy could have expected to receive for her work. His conclusions on detriment were summarised as follows :
“The detriment overall can be summarised as pay lower than she could have reasonably expected for her work, long hours, few holidays and the continued commitment to Woodrow. This applied for all the time she was at the farm. By 2013 Lucy had acted in this way for just under 30 years. A notable feature of this detriment is that it does not only consist in the level of pay and conditions, it also involves her commitment to farming at Woodrow rather than elsewhere. She became and is a highly skilled dairy farmer. It is hard to imagine what would have happened if Lucy had not been assured she was working to build and maintain a successful dairy farm which she would inherit, because that is a long way from what happened. The assurances had been given from more or less the start of her working life in the early 1980s and continued until 2008. If they had not been given things would have been very different. Most likely Lucy would still have learned dairy farming from her father but then she would have gone elsewhere, probably sometime in the 1990s. She probably would have sought a farming tenancy elsewhere long ago. To borrow an expression from other cases, in this case the claimant has positioned her working life based on her parents’ assurances.”
Birss J estimated the quantifiable part of Lucy’s detrimental reliance. He took account of the expert evidence concerning typical agricultural wages in order to estimate what Lucy could reasonably have earned over the period of her labour on the farm, and offset that against what she did in fact earn, to reach the conclusion that the upper limit of her quantifiable reliance losses stood at c. £220,000.
Relief: expectation, detriment and proportionality
Birss J also considered the debate concerning the approach to be taken to remedying the estoppel which has been found to have arisen and the decisions of the Court of Appeal in Davies and Jenning v Rice to which HHJ Matthews referred in James.
Birss J posed himself the following questions:
Birss J developed his analysis further by reference to sliding scale approach mooted by Lewison LJ in Davies. Whereas HHJ Matthews was not attracted to this approach, Birss J considered it to be useful, subject to one refinement – it is not only the length of time that the claimant has held the expectation and the extent of their detriment that is relevant in considering whether or not to give effect to it, how far the claimant has gone in performing what was expected of them is also relevant. In a quasi bargain case, where a claimant has been working to fulfil the promise made to them, they should be entitled to receive their expectation where they have substantially fulfilled their side of the bargain.
What relief should be granted?
Birss J concluded that Lucy had done what had asked of her over the years and thus that this was a case in which she should receive compensation based on her expectation, rather than her reliance loses. What she was promised was a viable dairy farm.
However, Birss J considered that the following factors needed to be taken into account in determining what relief to award Lucy:
On the basis of valuation evidence given in February 2017, an award assessed by reference to the land and buildings where the dairy enterprise had been carried out, excluding the farmhouse and other and, would necessitate a cash payment of £1,170,000.
Learning points for practitioners
This content is provided free of charge for information purposes only. It does not constitute legal advice and should not be relied on as such. No responsibility for the accuracy and/or correctness of the information and commentary set out in the article, or for any consequences of relying on it, is assumed or accepted by any member of Chambers or by Chambers as a whole.
Please note that we do not give legal advice on individual cases which may relate to this content other than by way of formal instruction of a member of Hardwicke. However if you have any other queries about this content please contact: