Luigi Nicodemo Vasami & Anor v Tony Hack & Anor

Proprietary estoppel requires an assurance relating to property, reliance on that assurance, detriment and unconscionability. The assurance must be assessed objectively in its factual context. A reference to a revocable testamentary intention does not necessarily amount to a promise. Reliance need not be the sole inducement, but there must be sufficient detrimental reliance to make it unconscionable to withdraw the assurance. In a family farming arrangement, occupation, shared work and financial support may point away from an intended tenancy.

The claimants, owners of a farm, sought possession from their nephew and his wife, arrears of rent, and return of a dairy herd or damages. The defendants denied that they were tenants and counterclaimed declarations based on proprietary estoppel and constructive trust, relying on alleged promises that the farm would ultimately belong to the nephew.

The court considered whether such promises had been made, whether there had been detrimental reliance, whether it would be unconscionable to seek possession, whether a tenancy or family arrangement existed, and who owned the dairy herd.

1. Proprietary estoppel. The alleged promises were not established. The correspondence after the 2021 meeting indicated reliance on claimed security of tenure rather than a promise of future ownership. A reference to the farm being left to the nephew under a will was understood as a statement of present and revocable intention, not an irrevocable promise.
2. Reliance and detriment. Even if an assurance had been made, the defendants had not shown detrimental reliance sufficient to establish an equity. Their work and expenditure were weighed against the benefits received, including profitable farming, rent-free occupation, and the opportunity to pursue other employment and careers. Reliance need not be the sole inducement.
3. Unconscionability. Even if detrimental reliance had been established, it would not have been unconscionable for the claimants to seek possession. The arrangement included an understanding that regular payments would assist with loan servicing and that £80,000 would be paid for the dairy herd. Those understandings were largely unmet.
4. Tenancy. The parties worked as a family or team. The payments discussed were referable to loan servicing rather than the rental value of the farm, and the parties did not intend to create a tenancy. The arrears claim therefore failed.
5. Dairy herd. The herd existing in 2008 was transferred by agreement to the defendants, although cows later bought by the claimant remained his.
6. Disposition. The claim for possession succeeded. The claims for rent arrears and return of the herd or damages failed. The counterclaim based on proprietary estoppel and constructive trust failed.