Southwell v Blackburn

Proprietary estoppel requires a broad and integrated assessment of assurance, reliance, detriment and unconscionability. The assurance must be clear and unequivocal, but it need not promise equal ownership or identify a precisely defined proprietary interest. An assurance of secure occupation in identified land may suffice. Detriment is assessed retrospectively, when the promisor seeks to resile, and is not confined to financial loss. In a cohabitation case, mutual benefits and domestic support need not be reduced to financial accounting where they are incidents of the relationship rather than consequences of reliance. Repudiating an assurance may remain unconscionable despite the relationship ending.

The parties began living together in 2002 in a house purchased and legally owned by the appellant. After the relationship ended in 2012, the respondent’s constructive trust claim failed, but the county court found that the appellant had assured her of secure occupation and that she had relied on that assurance by giving up a secure rented home, moving with her children and contributing to the new home.

On 13 December 2013, His Honour Judge Pearce-Higgins QC awarded her £28,500 for the proprietary estoppel equity. The appellant challenged the sufficiency of the assurance, the finding and assessment of detriment, and unconscionability.

The appeal was dismissed. Tomlinson LJ delivered the reasons, with McFarlane and Macur LJJ agreeing.

1. Proprietary estoppel is not analysed through watertight elements. Assurance, reliance and detriment overlap, and their existence does not necessarily establish an equity. Unconscionability permeates the whole inquiry. The broad approach described in Taylors Fashions Limited v Liverpool Victoria Trustees Co Ltd [1982] 1QB 133 and Gillett v Holt [2001] Ch 2010 was applicable.
2. The assurance must be clear and unequivocal, as stated in Thorner v Major [2009] 1 WLR 776. However, it may concern secure rights of occupation in identified land. It need not promise equal ownership or specify a precise proprietary interest. The binding decision in Greaseley v Cooke [1981] WLR 1306 established that a promise to allow continued occupation of a house may potentially raise an equity.
3. Detriment is substantial but non-technical. It need not be financial or capable of precise quantification, but it must have a sufficient causal link to the assurance. It is assessed when the assurance is repudiated, by looking back at the circumstances that actually occurred, consistently with Thorner v Major and the passage from Walton v Walton [1994] CA Transcript No 479.
4. The judge was entitled to treat the respondent’s abandonment of a secure home and investment in the new home as the relevant detriment. Rent-free accommodation, mutual support and benefits arising during the relationship were not necessarily direct consequences of reliance and did not require arithmetical accounting. The distinction from Sledmore v Dalby [1996] 72 P&CR 196 and the approach in Davis v Davis [2014] EWCA Civ 568 supported that conclusion.
5. Ending the relationship did not remove the effect of the assurance. The relevant detriment was surrendering secure accommodation and investing in a home in which the respondent had no legal title. Repudiation was therefore unconscionable. The appellate court should be slow to interfere with the trial judge’s evaluative findings, particularly where the judge had seen and heard the witnesses.

• Court of Appeal (Civil Division). The appeal against the order awarding £28,500 for proprietary estoppel was dismissed.
• Worcester County Court. His Honour Judge Pearce-Higgins QC dismissed the constructive trust claim, upheld the proprietary estoppel claim and ordered payment of £28,500 on 13 December 2013.