Fielden v Christie-Miller & Ors

For proprietary estoppel to bind several trustees, a representation by one trustee must be made with the authority of the others, or arise from their knowing acquiescence or conduct giving the appearance of joint authority. It is insufficient that the claimant reasonably believed that one trustee spoke for all.

The non-fettering principle prevents trustees from binding themselves in advance as to the future exercise of a fiduciary discretion. It does not necessarily defeat an equity arising from proprietary estoppel. If the estoppel is otherwise established, the court may grant relief against detriment or declare an interest which does not compel a future exercise of the trustees’ power, but limits its effect to the extent necessary to satisfy the equity.

The proceedings concerned trusts of estates at Swyncombe. Stephen Christie-Miller brought a Part 20 proprietary estoppel claim against current and former trustees, alleging that representations had induced him and his family to move to Home Farmhouse, incur expenditure and organise their lives on the footing that he would inherit the estates.

The trustees applied under CPR 3.4(2)(a) to strike out the claim and under CPR 24.2 for summary judgment. They argued that representations by one trustee could not bind the others without unanimity and that the alleged expectation was an impermissible fetter on their future fiduciary discretion. Stephen applied to amend his pleading if necessary.

1. The court rejected the trustees’ challenge based on the non-fettering principle. The principle prevents a trustee from pledging in advance how a fiduciary power will be exercised. It does not prevent relief for proprietary estoppel where the ordinary elements of representation or assurance, reasonable reliance and detriment are established.

2. Such relief need not compel the trustees to exercise their power in a prescribed future manner. It may confer an interest commensurate with the expectation or, at minimum, prevent detriment. An order protecting a rent-free right of occupation, for example, would leave the trustees free to appoint the asset, but subject to that declared right.

3. The court rejected the submission that apparent authority alone sufficed. Before one trustee’s representation can bind co-trustees, the pleading must identify, for each trustee, facts showing authority to make the representation, knowing acquiescence, or conduct placing the trustee in a position of apparent joint authority. This reflects the ordinary principles of agency and applies in proprietary estoppel.

4. The pleading failed adequately to identify the basis on which certain trustees were bound by the representations. It was adequate, but only just, in relation to one trustee and one representation. Unless suitably amended, the claim would fail on that ground.

5. The court therefore refused to strike out the Part 20 claim or enter summary judgment on the non-fettering challenge. The amendment application was to be addressed separately, and the developing proprietary-estoppel issue was better determined after findings at trial.