Gilpin & Ors v Legg

A right to station a hut on another’s land may create a tenancy where the occupier has exclusive possession for a certain periodic term in return for payment. The labels used by the parties do not determine the legal relationship. A yearly tenancy requires sufficient notice to determine it. The hut may remain a chattel even though the occupier has a tenancy of the plot. Informal assurances made after the original grant, and personal to earlier occupiers, do not normally create rights binding successors in title. Proprietary estoppel requires a clear assurance, reliance and detriment, or a qualifying failure to speak, together with unconscionability.

Six owners of beach huts on land at Portland Bill sought declarations and injunctive relief concerning notices served by the landowner. They contended that they held tenancies, or alternatively had rights protected by proprietary estoppel, and that the first notice was invalid.

The landowner contended that the arrangements were yearly licences. He served a first notice expiring on 31 March 2015 and a second notice to quit, served on 10 September 2015, expiring on 31 March 2016. He counterclaimed for declarations and other relief. The central issues were the nature and duration of the occupiers’ rights, the status of the huts, the effect of the notices, and proprietary estoppel.

1. Nature of the arrangements. Applying Street v Mountford [1985] AC 809 and Bruton v London & Quadrant Housing Trust [2000] 1 AC 406, the arrangements gave the hut owners exclusive possession of the plots for a term in return for annual payments. The terminology of “licence” and “licence fee” was not decisive.
2. The evidence established yearly periodic tenancies, automatically renewable, rather than successive fixed-term licences or five-year tenancies. Planning-permission periods did not rebut that conclusion. The first notice, expiring in less than six months, was ineffective. The second notice validly determined the tenancies at 31 March 2016.
3. Status of the huts. The huts were chattels. Their slight annexation was principally to prevent movement by wind, and they were capable when first placed on the land of being moved without substantial damage. Later deterioration did not itself alter their legal classification. Even if they had formed part of the realty, an implied term would have permitted removal as tenants’ fixtures.
4. Proprietary estoppel. The claim failed at the assurance stage. Statements that particular predecessors could stay while they paid rent were informal, made after the arrangements began, personal to those individuals, and not intended to bind successors. The alleged failure to speak did not satisfy the necessary conditions. The arrangements were not unconscionable.
5. The court could determine the effect of the second notice by declaration because it concerned a real future dispute in existing litigation. Further submissions were invited on the form of the order.