Yorkshire Building Society v Churchill & Anor

Permission to appeal should be refused where the proposed appeal has no real prospect of overcoming decisive difficulties and would fail even if part of the lower court’s reasoning were open to criticism. In a constructive-trust claim based on an alleged agreement to transfer an interest in land, negotiations remain inconclusive where the parties have not agreed the price. A proprietary-estoppel claim requires reliance on an assurance and knowledge of that reliance. A contemporaneous written statement inconsistent with the claimant’s asserted belief may defeat the claim. Criticism of credibility findings does not justify an appeal where the result independently rests on documentary evidence and an objective analysis of correspondence.

This was a renewed application by Mrs Jeanette Churchill for permission to appeal from an order made by District Judge Mildred at Bournemouth County Court concerning the beneficial ownership of a house occupied by Mrs Churchill and formerly owned jointly with her sister, Mrs Hazel James.

The District Judge rejected claims based on undue influence, constructive trust and proprietary estoppel. He found that negotiations for a transfer had not produced agreement on the price, and that Mrs Churchill’s mortgage payments were made to prevent repossession rather than in reliance on an assurance of ownership. Permission had previously been refused on the papers by Lawrence Collins LJ. The renewed application focused on alleged errors in the credibility assessment, including Mrs James’s 1999 mortgage application. The central issue was whether those matters gave the proposed appeal a real prospect of success.

1. Application refused. The renewed application for permission to appeal was rejected because there was no real prospect that the proposed appeal would succeed.
2. In relation to the constructive-trust claim, the decisive issue was whether the sisters had reached an agreement in late 1991 that Mrs Churchill would assume responsibility for the mortgage and receive Mrs James’s interest in the property. The solicitor-to-solicitor correspondence showed that the negotiations remained inconclusive because the parties never agreed the price or other consideration for the transfer. The conclusion therefore did not depend on the relative credibility of the sisters.
3. In relation to proprietary estoppel, the critical questions were whether Mrs Churchill made the mortgage payments in reliance on an assurance that the property would be transferred to her, and whether Mrs James knew of that reliance. Mrs Churchill’s letter of 4 August 1994 stated that the trust deed left ownership with Mrs James and responsibility for the mortgage with Mrs James. That letter was inconsistent with the asserted belief and reliance. Mrs James was entitled to treat it as an expression of Mrs Churchill’s understanding.
4. The Court accepted that the District Judge’s analysis of credibility could have been more rigorous. The 1999 mortgage application raised an issue which the judge had not addressed, but it was peripheral. It could not undermine the independent documentary bases for rejecting the constructive-trust and estoppel claims.
5. The Court noted that, if the adjourned issues of occupation rent and set-off were restored, credit should be considered for capital contributions made towards the mortgage. That issue was left for the District Judge and was not decided on the application.

• Court of Appeal (Civil Division) — [2007] EWCA Civ 904: renewed application for permission to appeal refused.
• Permission stage — Lawrence Collins LJ refused permission on the papers on 4 July 2007.
• Bournemouth County Court — District Judge Mildred made the order dated 19 April 2007 in the underlying proceedings. The claims based on constructive trust and proprietary estoppel were rejected.