St Pancras & Humanist Housing Association Ltd v Leonard

Proprietary estoppel requires more than unconscionable conduct in the abstract. The court must make a broad, fact-sensitive enquiry into whether it would be unconscionable to permit a party to deny an assumption which they knowingly or unknowingly allowed or encouraged another to make to that person’s detriment. Knowledge of the true legal position is relevant and may be decisive, but it is not invariably essential. Estoppel may arise where a person believed they had a possessory right and encouraged others to acquire communal rights inconsistent with it.

The respondent housing association sought possession of a garage occupied by the appellant. The appellant claimed 12 years’ adverse possession. The respondent accepted that adverse possession had been established but argued that the appellant was estopped from relying on it because his conduct had encouraged the residents’ co-operative to acquire a lease including the garage as communal property.

The Central London County Court found sufficient adverse possession but upheld the estoppel defence. The appellant challenged the estoppel finding, particularly the relevance of his lack of knowledge of adverse possession law. The respondent cross-appealed the adverse-possession finding, arguing that the appellant had not manifested the necessary intention to possess.

1. Disposition. Sir William Aldous dismissed both the appeal and the cross-appeal. Lord Justice Goldring and Lord Justice Lawrence Collins agreed.
2. Proprietary estoppel. The court accepted that proprietary estoppel requires a proprietary claim and cannot rest on unconscionable behaviour alone. The principle in Ramsden v Dyson had developed into the broader approach described in Taylors Fashions v Liverpool Trustees Ltd [1982] 1 QB 133, which was noted as approved in Habib Bank Ltd v Habib Bank AG Zurik [1981] 1 WLR 1625. The enquiry is whether, in the particular circumstances, it would be unconscionable to allow a party to deny an assumption that they knowingly or unknowingly allowed or encouraged another to make to that person’s detriment.
3. Knowledge and unconscionability. A person will ordinarily remain entitled to assert rights where they did not believe they had any right to object. That conclusion may differ where the person ought to have known of the rights by deliberately shutting their eyes to them, or where delay is so extensive that an estoppel arises. Lack of knowledge of a title acquired through adverse possession was not decisive here. The appellant believed that he had a possessory right to use the garage and believed that it would continue after the co-operative acquired a lease.
4. Application. The appellant’s silence and conduct at management meetings created the impression that he claimed no personal or preferential right to the garage. The co-operative relied on that impression by negotiating for and taking a lease, assuming repairing obligations and financial liabilities. The findings of representation and detriment were supported by cogent evidence. The facts were materially different from Cobbe v Yoemans Row Management Ltd [2008] 1 WLR 1752, because the housing association asserted a proprietary right arising from a lease.
5. Adverse possession. Other occupants’ unauthorised or tolerated use did not displace the appellant’s possession unless they ousted him and established a better possession. The trial judge had applied the correct approach to intention to possess, and her factual conclusions were not open to challenge absent an error of law.

• Court of Appeal (Civil Division) In [2008] EWCA Civ 1442, the appeal and cross-appeal were dismissed.
• Central London County Court Her Honour Judge Marshall QC found 12 years’ adverse possession but held that the appellant was estopped from relying on it.