Farming Disputes and Proprietary Estoppel

Spotlight on Farming Disputes and Proprietary Estoppel, by Nazia Nawaz

There has been an increasing number of disputes relating to farming land and estates, before the courts. We are seeing more litigation in this area than ever before.

So what is Proprietary Estoppel?

The legal doctrine of proprietary estoppel operates to enforce a verbal promise made by the owner of land. This arises where:

1. The  owner of the land promises, induces, or allows a person to believe that they will have some interest or rights over the owner’s land;
2. The promisee relies on that promise; and
3. In doing so suffers a detriment to the knowledge of the owner;
4. The owner of the land then attempts to renege on that promise and to deny the right or benefit which the promisee expected to receive.

Whilst the vast majority of cases arise after the death of the land owner, there have been a few cases recently which have been determined by the courts in the lifetime of the land owner and we discuss two such cases below, the facts of which explain to some extent why these type of claims are so prevalent in the farming and agricultural sector.

In the 2016 cases of Davies v Davies, the daughter of a farmer, successfully brought a proprietary estoppel claim against her parents for a share of the family farm on which she had worked since the age of 17 years.

She had been promised the farm on the basis she continued to work on the farm for the rest of her life. She worked long hours on the farm for very little wages until some years later when she was married and had a fall out with her family. She moved out of the farm briefly but following a reconciliation with her family she returned to work at the farm on the same terms but again in return for a promise that the farm would be hers.

Ultimately, after a series of arguments with the family, the Claimant brought a claim against her parents to enforce the promises that were made to her.

Here the Judge accepted that a promise had been made, that she had relied on that promise to her detriment by working long hours for little or no wage and by failing to explore any other career options. The Judge on Appeal, awarded the Claimant a lump sum payment, as the equivalent of what she was likely to have earned had she not relied on the promise and had she followed a different career path.

In the case of Moore v Moore (2018), Mr Moore, the son of a farmer brought a proprietary estoppel claim against his family for an interest and share in the family’s farming business.

Mr Moore’s father Roger and his uncle, Geoffrey had inherited the family farm from their own father and the brothers had run the farming business successfully taking it to a value of around £10million by the time of the dispute. Whilst they jointly operated the business as partners, no formal written partnership agreement was ever put in place.

Mr Moore claimed that he had been promised both by his father and his uncle that he would acquire the entire farm ultimately. He had relied on that assurance and had worked on the farm with his father since his childhood. Despite having two children of his own, Geoffrey transferred his share of the farm to Mr Moore, on retirement.

Mr Moore’s father, however lost mental capacity before he fully retired from the business and his affairs were taken over by his wife with whom Mr Moore was in dispute. She sought to deny that any promise or assurance was ever made to her son or that he suffered any detriment.

Here too, the Judge accepted, based on witness evidence, that a promise was made to Mr Moore that he would acquire the farm. It was also accepted that there was a detrimental reliance by Mr Moore in that he had spent so much of his life working at the farm for a minimal wage and had not considered other work opportunities. The Court held that it was only right that Mr Moore should be awarded his father’s share in the farm as that is was he was led to expect. This is a slightly different approach to one taken by the court in the Davies case above, where the court attempted to quantify the financial detriment to the Claimant in not pursuing other career options.

These cases highlight the importance of documenting all agreements and promises relating to land in formal and legally binding partnership agreements, which can reduce the potential for such disputes to arise.

For advice and assistance in relation to these and similar matters, please contact Nazia Nawaz on 01204 540941 or by email at Nazia.nawaz@fieldingsporter.co.uk