Lord Denning in Crab v Arun stated that the function of proprietary estoppel is “…to prevent a person from insisting on his legal right…whether arising under contract, or on his title deeds, or by statute…when it would be inequitable for him to do so having regard to the dealings which have taken place between the parties.” This doctrine restrains a landowner from making unconscientious withdrawal of his representation if the person to whom it was made has relied upon it to his detriment as it would be unconscionable. In essence, PE is a set of principles whereby an owner of a land may be held to have conferred some right or privilege connected with the land despite the absence of formalities. It is submitted that since PE is an equitable doctrine, it allows judges to do justice where the strict adherence to the law may result in unfairness. This view is supported by Martin Dixon in his book “Modern Land Law” where he explained that this doctrine is another example of the intervention of equity to mitigate the consequences of lack of compliances with the formality requirement of the common law or statue. As Elizabeth Darlington wrote in her article on proprietary estoppel for Zenith Chambers, Proprietary estoppel, unlike the related doctrine of promissory estoppel, gives rise to a cause of action and does not merely operate as a defence as can be seen in Thorner v Major. This means that PE not only can be used as a ‘shield’ but also a ‘sword’. The question requires a discussion on whether this doctrine is one which shows flexibility, proportionality and fairness, in doing so, it is required to look at the requirements of a claim and how it serves its purpose to claimants.
The development of this doctrine can be seen through the way courts approach this doctrine and it can be seen in early cases such as Ramsden v Dyson that the courts initially adopted a broad approach in establishing this doctrine. Since a successful claim in proprietary estoppel could result in the creation of interest in land that affects estate owner and future purchasers and transferee of land, it is not surprising the conditions have become stricter. These conditions were first codified by Fry LJ in Willmott v Barber where he identified the five probanda of proprietary estoppel which is quite big of a hurdle for claimants. As a reflection of modern condition, the five probanda by Fry LJ have been largely abandoned and a more modern approach which is much more flexible is introduced. According to Oliver J in Taylor Fashions v Liverpool Victoria Trustees, a claimant will be able to establish an estoppel if they can prove an assurance, reliance and detriment in circumstances in which it would be unconscionable to deny a remedy to the claimant. This modern approach provided more effective remedy as the requirement needed to make a claim has significantly been ‘watered down’. This shows that the doctrine of PE has changed in the sense that it had become more flexible with less difficult hurdles for claimants. It was established in Jennings v Rice that these four features should not be looked at separately but must be looked at ‘in the round’. The House of Lords in Thorner v Majors reiterated that a holistic approach should adopted when establishing proprietary estoppel.
To claim under this doctrine, the land owner must have made some kind of assurance to the claimant that either he would refrain from exercising his strict legal rights over his own land or that the claimant might have some present or future right or use over the land. In most cases, the assurance will be as to some specific property right over the land, however as seen in the case of Thorner v Major, this is not always necessary. On the facts, there was an implied understanding that David was going to inherit the land. The COA in determining whether implied understanding can amount to assurance held that PE could not be given since assurance has to be based on clear promise. The HOL reversed the decision of the COA and Lord Walker explained that assurance is determined depending on context and awarded PE in favour of David and the farm was granted to him. Furthermore in Ramsden v Dyson, it was established that a representation can be made by conduct even by remaining silent. An example of an assurance that have been taken to be enough can be seen in the case of Gillett v Holt where Mr Holt said he wanted to Geoffrey to run the farm which he saw as being a ‘permanent arrangement’.
Next the claimant must show that they had relied on the assurance. In practice, reliance may be hard to prove and a claimant can show reliance through change in conduct. The court of appeal in Greasly v Cooke held that, if clear assurance have been made and detriment has been suffered, it is permissible to assume that reliance has occurred. Similarly in Wayling v Jones, the court of appeal only looked for a ‘sufficient link’ between the assurance made and the detriment incurred by the plaintiff, and the burden would be on the defendant to show that there was no reliance. It is crucial to note that there will be no reliance if it can be shown that the claimant would have incurred detriment completely irrespective of the defendant’s conduct as seen in the case of Orgee v Orgee. However, there are some cases such as Campbell v Griffin which shows that a detriment which is not caused by defendant’s conduct may also be considered reliance. Hence, it can be said that the existence of reliance is critically dependant on the peculiar facts of each cases which cannot be discounted merely because of family or emotional ties that might otherwise explain a course of action.
The doctrine of proprietary estoppel cannot be established unless the claimant can prove that he has suffered detriment in reliance of the assurance and it can be in any form so long that it is not minimal or trivial. An example of detriment is to work for low pay or no pay as can be seen in the case of Gillett v Holt. As Campbell v Griffin and Jennings v Rice show, it is not necessary that the detriment be related to land at all as long as there is detrimental reliance which makes retraction of assurance unconscionable. In Jennings v Rice, the COA held that proportionality was essential between expectation and detriment in deciding how to satisfy equity based on PE. It should be noted that detriment alone is insufficient as seen in Taylor v Dickens, where the plaintiff worked for a number of years without pay with the expectation the he would inherit from the deceased. In the case, the deceased changed her will and left it to another and the plaintiff could not claim proprietary estoppel as there was no assurance despite there being detriment. Although this may seem harsh, it remains the case that an unencouraged detriment is not sufficient for the purpose of this doctrine. The case of Lloyd v Dugdale cleared this doubt as it made it clear that the detriment must be incurred by the person to whom the assurance is made.
Due to social and economic changes and the tightening of formality rules in light of section 2 of the Law of Property (Miscellaneous Provisions) Act 1989, the doctrine of proprietary estoppel grew in its importance. Rawdon Crozier in Estoppel and elephant traps stated that the law is littered with “elephant trap” and the modern doctrine of estoppel seems particularly prone to attracting them. Absence of reference to estoppel in the LPMPA caused difficulty and was addressed in Cobbe v Yeoman’s Row Management by Lord Scott who questioned how proprietary interest can make valid an agreement that would be considered void under s.2 LPMPA due to the fact that formalities was not complied. He however felt that it was unnecessary to answer the question an observed “equity can never contradict statute”.
As Oliver J pointed out, unconscionability is regarded as the essence of the doctrine of proprietary estoppel and this can be seen in the cases discussed. Unconscionability frees the court from the strict formality requirements imposed by statute and allows the claimant to succeed in claims where it would be unconscionable to retract assurance. Aldous LJ in Jennings v Rice held that, ‘there can be no doubt that reliance and detriment are two of the requirements of proprietary estoppel and that the basis of estoppel is, “the interposition of equity; thus the requirement of unconscionability”. It is submitted that although unconscionability is required due to equitable interest involved, unconscionability alone may not necessarily lead to remedy. This view is supported by Nigel Gravells in his book where he stated that ‘unconscionability alone, without detrimental reliance on a representation, is insufficient in itself to found proprietary estoppel claim’. This is substantiated by the House of Lords decision in Yeowman’s Road v Cobbe, where Lord Scott held that ‘proprietary estoppel should be limited to the representations only of specific facts’. In this case it was ultimately determined that unconscionability of a conduct alone will not lead to remedy, the claimant must show that there was assurance and they relied upon it to their detriment. In Cobbe, the court held that a businessman who had taken a risk cannot claim estoppel and the court should be careful of causing uncertainty by awarding estoppel in commercial situations.
The contrasting case to Cobbe is the case of Thorner where the claim succeeded. Lord Walker was of the view that certainty is important in property transaction. The difference between the two cases is that Cobbe was a commercial setting while Thorner was purely a case of domestic context, hence the claim for PE was successful. The House of Lords decision in Cobbe and Thorner shows that the purpose of estoppel is not to remedy unconscionable conduct per se but it is a response to an assurance about land, reliance and detriment, where it would be unconscionable for the assurance to be withdrawn. The effectiveness of this doctrine can be seen through the developments on the requirement needed to establish a claim.
Moving on, it is important to note that this doctrine is not a universal remedy that cure all defects in formalities, because if it was, there would be no point in having formality rules. Some argue that this doctrine undermines formalities which are contained in statutes, this may lead to allegations that the courts have overstepped their jurisdiction which is against separation of powers. However, Lord Scott negated this argument by stating that PE cannot render enforceable an agreement that statute declares void. He also said that ‘equity can surely not contradict statute’. Conversely, Dixon was of the view that this doctrine is available to cure absence of formality when ‘it would be unconscionable for the defendant to relay on lack of formality to defeat the claimant’. This shows that there is proportionality in tis doctrine and that it may be applicable in certain circumstances relating to statutory provisions.
It is important to note that this doctrine should be distinguished from the doctrine of constructive trust although the two concept requires detriment and work on the basis that it would be unconscionable for the legal owner to deny the existence of the beneficial interest. In Yaxley v Gotts, Robert Walker LJ recognised the numerous grounds of similarities between the two doctrines since both are derived from equity’s intervention to provide relief. His Lordship also held that at a high level of generality, there is much similarity where they coincide in the area of a joint enterprise for the acquisition of land. Mark Pawlowski in his writing stated that in both the cases of Gissing and Edwards, ‘equity acts on the conscience of the legal owner to prevent him from acting in an unconscionable manner by defeating the claimant’s belief.’ In other words, the similarity envisaged between the two is that they are derived from equity which is concurrent with the opinion of Robert Walker as mentioned earlier. The main difference between the two doctrines is that proprietary estoppel is based on representation whereas constructive trust rely upon bargains or common intention.
To conclude, it is opined that the doctrine may have not always been consistent in terms of flexibility, proportionality and fairness although often being considered. However, this area of law have been relatively dynamic and can be seen to have evolved over the years. Today, with reference of case laws discussed, it can be seen that this doctrine is moderately flexible, proportionate and in most cases fair. The doctrine has developed from one difficult to establish and unreliable doctrine to one which operates based on unconscionability and less strict requirements. Dr. Zaid Muhmoud Al-Aqaileh concluded in ‘The English Law Doctrine of Proprietary Estoppel and the Extent to which it could be Applied in Jordanian Law’ that proprietary estoppel plays an effective role in the context of English land law as it can be used to found a claim, as well as to defend one. Thus, it can be regarded as a mechanism by which the law sanctions the informal creation of proprietary rights in property.