Fairacre Investments Ltd.v Earlrose Golf & Leisure Ltd & Anor

A boundary agreement must be assessed objectively in its factual and commercial context. An informal agreement fixing a line for tipping or other business operations does not thereby alter the parties’ legal boundary. Actual authority to manage land and negotiate operational matters does not, without more, include authority to agree legal boundaries on behalf of the owner. Where the alleged agreement was made without identifying the legal owner, obtaining legal advice, recording the line or addressing the legal title, the court may conclude that it concerned only operational use. In the absence of authority, the agreement cannot bind the owner or its successor. Proprietary estoppel and constructive trust claims likewise fail where there was no relevant assurance, representation or common understanding attributable to the owner.

The claimant, the registered proprietor of the Lizzards, claimed trespass against the defendants, who operated a waste recycling depot on adjoining land. The defendants occupied and used areas extending beyond their registered title. They relied on alleged oral boundary agreements made in 1994 and 1996 by William Barron, said to have represented the then owner of the Lizzards, and alternatively pleaded proprietary estoppel and constructive trust.

The central issues were whether Mr Barron had actual authority to agree the legal boundaries, whether the alleged agreements were true boundary agreements or merely operational arrangements fixing tipping lines, and whether the defendants had established detrimental reliance or any equitable basis for relief.

1. Claim succeeded. The defendants’ use extended beyond the registered boundary. The claimant was in principle entitled to possession of the disputed land, with the form of any injunction to be addressed after further submissions. Mesne profits were to be assessed by the master if not agreed.
2. The scope of Mr Barron’s actual authority was limited to general site management, operations on the ground, and planning and regulatory matters. It did not include authority to agree the precise legal boundaries with neighbouring landowners. No such authority could be inferred merely because its limits had not been expressly discussed.
3. The legal character of an alleged boundary agreement is determined by an objective appraisal of its terms and surrounding circumstances. The agreements made in 1994 and 1996 were informal arrangements fixing the areas in which tipping operations could take place. They were not intended to settle the legal boundary or transfer title. Relevant circumstances included the absence of legal advice, written record, measurements, identification of the legal owner, or reference to the registered title.
4. Because Mr Barron lacked authority, the alleged agreements could not bind Guinea or Fairacre as its successor, even if agreements in the alleged terms had been made. The alternative proprietary estoppel and constructive trust defences also failed because no relevant assurance, representation or common understanding was made by or on behalf of Guinea.
5. The defendants’ reliance case did not alter the result. Earlrose acquired the depot by reference to the registered title, and later works were undertaken after notice of the claim or concerned land outside the alleged agreements.