Charity Legacy Case Study: Proprietary Estoppel

Habberfield v Habberfield [2018] EWHC 317

Charity, Charity Legacies

Husband and wife Frank and Jane Habberfield owned and ran the 220 acre Woodrow Farm in Yeovil. When Frank died in 2014, Jane inherited the entire farm. As a result of a recent High Court proprietary estoppel claim however, their youngest daughter Lucy has been awarded a significant cash payment in the value of £1.17 million which equated to around 45% of the value of Woodrow Farm.

Lucy had worked on the dairy farm for some 30 years, on a full time basis, for very low pay. She took few holidays (some 5 weeks in 30 years) throughout that time. From 2008 her partner, Stuart, also worked on the dairy farm with her. Lucy did not work elsewhere and committed herself entirely to working on the dairy farm at Woodrow. On Frank’s death she issued a claim in proprietary estoppel at the High Court, claiming, in summary, that Frank had promised her the farm would be hers one day and that she was entitled to it in its entirety.  

To succeed with a claim in proprietary estoppel Lucy needed to establish three main elements:-

  • Assurance / promise: that Frank (and/or Jane) assured her that she would one day own the farm;
  • Reliance: that she, Lucy, relied on that assurance; and
  • Detriment: that in relying on it she suffered detriment.

Lucy claimed that there had been 10 representations made by Frank (and sometimes by Jane). These included claims that over an extended period he told Lucy that the farm would one day be hers; that the cows were her responsibility: “they are your cows, and if you want them you should milk them”; and when Lucy asked for a weekend off in 1992, she was told she had to stay at the farm to ensure the work was done. On other occasions she was told that “the cows would not be there when [she] got back”.

Crucially, a key piece of evidence was a letter written in 2008 by a surveyor that recorded a proposal for Lucy to be part of a new limited partnership to run the business and that she would become the eventual overall owner when her parents died. The Court found that this letter reflected Frank’s other assurances and although his (and sometimes Jane’s) representations were not always explicit the Court found that they were not “casual or idle” remarks and that they fitted together and amounted to a coherent promise that Lucy would inherit a “viable dairy farm at Woodrow”.

The Court found that Lucy had relied on the assurances to her detriment, and therefore had proved her claim. However, rather than awarding Lucy the whole farm she was awarded a substantial payment of £1.17 million – 45% of the value of the estate.

This case highlights the difficulties in defending proprietary estoppel claims – which can be even more of a hurdle for a charity defendant – and the impact a successful claim can have on the value of an estate.

Some practical steps for helping you to try to come to a prompt and cost effective solution include:

  • Review and gather evidence: Scrutinise the claimant’s evidence and consider if there is any available evidence to defend the claim, or are there other avenues worth exploring further?
  • Seek early legal advice: In light of the available evidence, investigate the merits of the claim: what are its strengths, its weaknesses? You might consider obtaining counsel’s opinion.
  • Form a strategy: If the claim is poor: see it off in correspondence, and avoid proceedings. If it has merit, can the claimant’s evidence be undermined? Are there other charity beneficiaries? If so, consider joining forces; share resources (and legal advice) and support one another. It could all help to reduce costs. Keep the strategy under review.
  • Consider settlement if appropriate: If the claim has some merit, consider making an early settlement offer. An early settlement could avoid the parties having to incur the costs and time preparing for trial – and could avoid proceedings altogether.

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This information is necessarily of a general nature and doesn’t constitute legal advice. This is not a substitute for formal legal advice, given in the context of full information under an engagement with Bates Wells.

All content on this page is correct as of May 14, 2018.