Hoyl Group Ltd v Cromer Town Council

Proprietary estoppel requires a holistic assessment of assurance or encouragement, reliance and detriment, and whether it would be unconscionable to permit strict rights to be asserted. The traditional probanda for pure acquiescence do not impose inflexible conditions in a case involving active encouragement. Silence and inactivity may contribute to the assurance. Actual knowledge of the claimant’s precise belief or of every act of reliance is not invariably required. Where a landowner approves and encourages works whose configuration is only consistent with an access right, and the claimant acts to its detriment on the common assumption that the right will exist, refusal to recognise the right may be unconscionable.

Hoyl agreed to take a lease of a basement at North Lodge and intended to convert it into a residential flat. Its revised plans made access through Cromer’s garden the intended main entrance, while internal access was temporary and the car park route was designated as a fire exit. The lease granted only a right of way to the car park. After the internal access was blocked and the flat was marketed, the purchaser discovered that no formal garden right of way had been granted. HHJ Moloney QC held that proprietary estoppel arose and ordered the equity to be satisfied by a right of way to a new private gate, while rejecting another claimed route. Cromer appealed. Hoyl’s contingent cross-appeal did not arise. The central issue was whether Cromer’s conduct encouraged the belief in a garden right of way and made its later denial unconscionable.

Disposition. Floyd LJ gave the judgment, with McFarlane LJ and Longmore LJ agreeing. Cromer’s appeal was dismissed. The contingent cross-appeal did not arise.

1. Applicable approach. Proprietary estoppel is determined holistically by asking whether the claimant was induced, encouraged or allowed to assume that an interest in land would be enjoyed, acted on that assumption to detriment, and would suffer an unconscionable denial of it. The five probanda in Willmott v Barber (1880) 15 Ch D 96 are not a universal yardstick. The broader approach in Taylors Fashions Ltd v Liverpool Victoria Trustees Co Ltd [1982] QB 133, approved in general terms in Cobbe v Yeoman’s Row Management Ltd [2008] 1 WLR 1752, and the analysis in Thorner v Major [2009] UKHL 18, require attention to the whole factual context. Knowledge remains relevant, but is not an inflexible prerequisite.
2. Belief and encouragement. The judge was entitled to find that Hoyl believed it had, or would have, the garden right. Plan B necessarily required external access through the garden. Cromer understood that consequence, indicated that an arrangement was likely to be acceptable, urged completion of the works, and knew that internal access was temporary. Its conduct and silence together amounted to encouragement. Kammins v Zenith Investments [1971] AC 850 concerned knowledge in the context of acquiescence and did not govern this case. The dictum in Brinnand v Ewens [1987] 19 HLR 415 had to be confined to its different factual setting.
3. Reliance and detriment. Construction of the flat in accordance with Plan B and closure of the internal access were acts of detrimental reliance. On the facts, the configuration would have been irrational without the anticipated garden access, and closing the internal door would otherwise have left Hoyl dependent on entry through a small bedroom. Cromer knew of and encouraged the works.
4. Unconscionability. Cromer approved and encouraged a configuration which both parties understood to require a garden right of way, then refused to recognise it after substantial expenditure. The alternative car park route was viable but highly inconvenient and inconsistent with Plan B. That alternative, and Hoyl’s temporary reluctance to decide who should pay for a new gate, did not prevent the equity arising. Hoyl was nevertheless required to pay for the gate when the equity was satisfied.

• Court of Appeal (Civil Division): Cromer’s appeal against the proprietary-estoppel finding was dismissed. Hoyl’s contingent cross-appeal did not arise. [2015] EWCA Civ 782.
• Norwich County Court: HHJ Moloney QC held that proprietary estoppel entitled Hoyl to a right of way via a new private gate, while rejecting its claim concerning another right of way. Order dated 30 September 2014.