What can disappointed beneficiaries do when a will doesn’t honour verbal promises (to their detriment)? Katie Alsop outlines what to bear in mind in a proprietary estoppel claim.

Many contested wills feature valuable estates that include farms and/or land, and the combination of a high-value estate and grounds to contest a will is often sufficient to launch a claim. Add to the mix a will containing different terms to those anticipated, and a proprietary estoppel claim from a disappointed beneficiary may well be the result. 

Many proprietary estoppel cases have been highlighted by the media – the high-profile case nicknamed the ‘Cowshed Cinderella’ is a good example. There is much greater awareness that a claim for proprietary estoppel can be brought if a will does not honour promises made by the deceased, particularly if a claimant believes their reliance on that promise has caused detriment.

It is worth noting that proprietary estoppel claims are often associated with the agricultural sector, and most case law is testament to this. To bring a proprietary estoppel claim, it is necessary to show that:

• a promise has been made
• that the promise was believed and relied on
• that reliance on the promise caused the claimant to suffer detriment

The promise

A broken promise is usually revealed when the deceased’s will is read and an asset that an individual expected to inherit is bequeathed to someone else. At this point, the claims for contesting a will and proprietary estoppel become intertwined.

‘One day, all this will be yours’ is a fairly standard piece of evidence in proprietary estoppel cases. Claimants will maintain that a promise in one form or another was made, usually over a period of time, leading the claimant to believe they will receive property, land or a business. The court will hear evidence about how the promise came about, and the context in which it was made.

There are no hard and fast rules as to what amounts to a promise, but unsurprisingly, any evidence put before the court from a third party in support of the claimant’s position is generally found to be helpful when assessing if a promise has been made.

Evidence from third parties with nothing to gain from the litigation is particularly valuable. It is common ground that proprietary estoppel claims are very much a case of a consideration and assessment of one party’s recollection of events against the facts and the recollection of those who usually have a competing interest.

Reliance

When a promise has been made, it must be relied on by the claimant, who must believe it to be effective. The court will also expect the claimant to have used the promise as part of a decision-making process when making certain life or career choices.

Detriment

The claimant must have suffered a detriment by relying on the promise. A detriment can come in various guises, but typically, it is financially linked. The court will consider the extent of the detriment suffered. In circumstances where it is argued that an alternative career would have been pursued had it not been for the reliance on the promise, the claimant should provide evidence demonstrating the comparable gain from the alternative career.

When assessing detriment, the benefit gained by the claimant must also be considered to weigh up the overall position. The benefit does not necessarily have to be direct financial gain; it could be, for example, accommodation provided free of charge.

Quantum

The starting point for quantum is that if all the elements of proprietary estoppel are established, and the court deems that it is unconscionable to permit the deceased to renege on a promise, the court may consider making an award.

The award to which the claimant is entitled may not necessarily be the whole of the property that they say was subject to the promise. Being an equitable remedy, the court’s role is to do justice. In practice, this means that an award will be made so as to achieve that result, rather than conducting a strictly financial exercise. Claimants should be made aware of this, so as to manage expectations.

Costs and alternative dispute resolution

Proprietary estoppel claims are often hostile, and therefore costs can be significant. Costs usually  follow the event, ie the losing party will be responsible for the winning party’s costs. Clients should be encouraged, where appropriate, to consider alternative dispute resolution. There are mediators who specialise in proprietary estoppel claims (and the agricultural sector, if relevant to the case).

Associated claims

It’s not unusual for a proprietary estoppel claim to be coupled with a claim for provision under the Inheritance (Provision for Family and Dependants) Act 1975; if this is the case, it’s important to be aware of the period in which those claims should be made.

Conclusion: a practical note

Although a proprietary estoppel claim has distinct elements, courts look at these claims very much ‘in the round’.  There should be a balancing process when assessing detriment, given the potential restriction on any award in light of it being an equitable remedy. Detailed witness evidence is important, and enquiries should be made at the outset, especially where a witness is elderly. It has been suggested that where time is particularly short in terms of the life expectancy of a witness, video evidence may suffice.

About the author

Katie Alsop is an associate at Wright Hassall LLP.