Proprietary Estoppel

 What is Proprietary Estoppel?

A claim for proprietary estoppel arises if a person makes a promise and someone relying upon that promise acts to his or her detriment.

When can you claim a Proprietary Estoppel?

Any problems usually become apparent when the Deceased’s will is read and an asset, such as a property, is left to someone  - but another person believes it was promised to them.

What are the requirements for a proprietary estoppel claim?

  1. The Claimant had a genuine belief at all material times that the Deceased intended to make a gift to him or her (a ‘promise’)
  2. The Deceased encouraged that belief
  3. As a result of relying on the Deceased’s promises the Claimant acted to his or her detriment 

What amounts to a promise?

There are no fixed rules on what amounts to a promise to satisfy Proprietary Estoppel claims. Cases are very much decided on a case by case basis although usually the promise must be “clear and unequivocal”. The Court will consider the Claimant’s evidence and any other third-party evidence that can help the Court determine if promises were made.

What is meant by reliance?

When the Deceased has made a promise to a Claimant then the Claimant must also show that he or she relied on that promise and took a different path than he or she would have done had it not been for the promise.

What is meant by detriment?

The Claimant must have suffered a disadvantage by relying on the promise. The disadvantage can come in many different forms, for example: accepting a low wage; working long hours; providing care; or not pursuing an alternative career.

The court will consider the extent of the detriment suffered but will also weigh up any benefit the Claimant may have gained e.g. living rent free while being the Deceased’s carer.

 What is the value of a proprietary estoppel claim?

If the Court finds that all the requirements of proprietary estoppel are met, and the Court is of the view that it would be unacceptable to allow the Deceased to renege on the promise they had made, then the Court has a discretion to make an award to the Claimant.

The value of the award is entirely a decision for the Court. The Claimant might not get what they were promised. The award will be an amount proportionate to the detriment suffered and taking account the claims of other beneficiaries or potential beneficiaries.

Will the claim go to Court?

Proprietary estoppel claims are highly contentious and can be very expensive to pursue. If Court proceedings are issued, costs usually follow the event – in other words, the unsuccessful party will usually have to pay the successful party’s costs.

Proprietary Estoppel cases are suitable for mediation and negotiation which may lead to settlement during the claim without having to go to Court. Very few Proprietary Estoppel claims reach trial.

Are any other claims relevant?

It is quite common for proprietary estoppel claims to be run alongside claims under the Inheritance (Provision for Family and Dependants) Act 1975 (‘the Inheritance Act’) or whilst contesting a will on other grounds such as capacity or lack of proper execution.