Proprietary Estoppel

Davies & Another v Davies [2016]

It is not unusual in farming families for members of the family to work long hours at low wages and sometimes over many years in reliance upon assurances that, one day, the farm will be theirs.  That was the basis of the claim in Davies v Davies.  Eirian Davies worked on her parents’ large pedigree dairy farm for long hours at low wages over many years, in reliance upon her parents’ assurances that the farm would one day be hers.  When, in 2012, Eirian’s parents brought proceedings to evict her from the farmhouse, Eirian counterclaimed an interest in the farm land and business based on the promises that had been made.

The High Court found that Eirian did have a valid claim for relief based on proprietary estoppel.  The extent of her interest was left to a later hearing.  When the matter returned to the High Court it had to decide how her claim was to be satisfied, whether by a monetary payment, licence to remain in the farmhouse or some other way.  In January 2015 the High Court found that a payment of £1.3m by the parents to Eirian was an appropriate award.  The parents’ appealed and the Court of Appeal has now reduced the award to £500,000.  In reaching that decision they criticised the Judge in the first instance for applying too broad a brush, failing to analyse the facts with sufficient rigour and, significantly, failing to explain why he had reached the conclusion that he had.

The case illustrates how difficult it is to calculate a monetary award to satisfy an equity based on estoppel.  That is particularly difficult in the context of a family farming partnership with changing and uncertain expectations.