Kerr & Anor (as Trustees) v Maass

Proprietary estoppel by acquiescence requires knowledge of the claimant’s mistaken belief concerning the right asserted against the defendant’s inconsistent right. A substantial mismatch between the belief known to the defendant and the proprietary right later claimed cannot ordinarily found the estoppel. Unconscionability is an additional requirement and cannot replace belief, reliance and detriment.

Where a landlord’s repairing obligation applies, damages for disrepair are assessed by reference to the tenant’s discomfort and inconvenience, applying the contractual expectation measure. Repair costs are not automatically the measure of loss, and rent is only a broad factor where it is artificially low.

The trustees of the Haie Estate sought possession of Arams Farmhouse after serving a notice under Housing Act 1988, s 21, against Christian Maass. Mr Maass claimed proprietary estoppel by acquiescence based principally on repairs and improvements undertaken by him and his predecessor while paying a low rent.

Alternatively, he claimed damages for disrepair under Landlord and Tenant Act 1985, s 11. The issues were whether the estoppel was legally arguable and established on the facts, and, if the occupation was an assured shorthold tenancy, whether the landlord knew of the disrepair and what damages were appropriate.

1. Proprietary estoppel. The defence and counterclaim based on proprietary estoppel by acquiescence failed. The agreed formulation required a mistaken belief by B concerning B’s current rights, knowledge by A of that belief and of A’s inconsistent right, reliance, detriment and unconscionability. Knowledge merely that the occupier misunderstood a contractual repairing obligation could not support a claim to a permanent proprietary right in the property where the alleged belief about that proprietary right was not known to the owner (paras [19]–[26]).
2. There need not be perfect alignment between the owner’s right, the claimant’s countervailing right, the parties’ beliefs and the owner’s knowledge. But the mismatch here was substantial. The judge also held that unconscionability could not substitute for the specific requirements of proprietary estoppel, referring to Cobbe v Yeoman’s Row Management Ltd [2008] UKHL 55 (paras [23]–[25]).
3. In any event, Mr Kerr had not known, and had not wilfully shut his eyes to, any belief that Mr Maass or Mr Rohwedder had a right greater than an assured shorthold tenancy. Nor was there adequate relevant reliance or detriment. The works were substantially improvements, were enjoyed by the occupiers, and were counterbalanced by the benefit of a substantially below-market rent (paras [99]–[119]).
4. Disrepair. The counterclaim succeeded. Mr Kerr’s 2014 visit gave him sufficient appreciation of the general, significant disrepair, particularly damp, and the claim was therefore not defeated by lack of notice. Damages were assessed by putting the tenant, so far as money could, in the position that proper performance of the repairing obligation would have produced. The relevant loss was discomfort and inconvenience. Repair costs were not a principled measure because they were not correlated with the impact on occupation; rent could be considered only as a broad factor (paras [124]–[143]).
5. Damages were assessed at £5,000. Mr Kerr was entitled to possession of Arams Farmhouse, while the proprietary-estoppel counterclaim failed (paras [144]–[148]).

Not an appellate decision. No prior appellate history is stated in the judgment.