Herbert v Doyle & Anor

Proprietary estoppel requires an assurance of a right or interest in land, reliance, and unconscionable detriment. The elements are interdependent. An informal land agreement is not necessarily defeated merely because it contemplated later legal formalities or failed to comply with section 2(1) of the Law Reform (Miscellaneous Provisions) Act 1989, where the requirements of estoppel are otherwise established. However, negotiations expressly subject to contract will make estoppel exceptionally difficult, and practically impossible where fundamental matters remain unresolved. Later variations do not defeat an estoppel unless the original arrangement was abandoned and superseded. Relief may be conditional upon performance of the agreed terms.

The claimant developed Mansfield House by constructing three houses and sought a transfer of three parking spaces owned by the defendants. He alleged that the defendants had agreed to transfer the spaces and had allowed the development to proceed, giving rise to proprietary estoppel or a constructive trust. The defendants relied on wider terms concerning replacement parking, leases, building works and electronic gates, and counterclaimed for declaratory relief, damages and injunctions. The central issues were the terms of the parties’ informal agreements, whether the claimant relied on them to his detriment, and whether he had satisfied the conditions necessary to obtain the parking spaces.

1. Proprietary estoppel. The claimant had to establish an assurance or representation that he would receive a specified right or interest in land, reliance on that assurance, and unconscionable disadvantage or detriment. These elements were interdependent.
2. The agreement was unenforceable as a contract because it did not comply with section 2(1) of the Law Reform (Miscellaneous Provisions) Act 1989. That did not, by itself, prevent a proprietary estoppel giving rise to a constructive trust under section 2(5). The judge declined to follow Lord Scott’s contrary obiter view in Cobbe v Yeomans Row Management Ltd [2008] UKHL 55.
3. Although the parties contemplated later legal documentation, the April 2003 agreement was intended to be relied upon and was not freely withdrawable. The relevant terms included replacement parking, leases of the staff-room extension and compressor house, completion of the building works, and installation of electronic gates. Subsequent variations did not extinguish the estoppel because the underlying arrangement had not been abandoned.
4. The claimant had relied to his detriment by developing the houses without legal title to the relevant land. Nevertheless, he had not satisfied the agreed conditions. The staff-room extension was incomplete, the required leases and gates had not been provided, and the proposed exchange of three red spaces for three green spaces did not supply the required adequate parking.
5. The claimant’s claim for transfer of the green spaces was therefore refused. A conditional declaration was made that he would be entitled to the transfer only after satisfying the specified conditions. The defendants were awarded £5,145 in damages for the encroachments. No damages were awarded for boarding up windows, and the judge indicated that undertakings might make injunctions unnecessary.