This exam was submitted by Sarah Hair as part of The Verdict's Law Review series. Check out our other example essays here.
PART A: Problem Question
In advising Shauna, there are three key issues to address: firstly, whether Peter enjoys an easement of right of way over The Firs; secondly, whether Shauna excepts and reserves the right to run her water pipe through The Laurels; and thirdly, whether Peter is breaching a restrictive covenant prohibiting building on The Laurels.
The Shortcut
For Peter to assert The Laurels benefits from a right of way, the easement must satisfy the four essential characteristics defined in Re Ellenborough Park (1956): a dominant and servient tenement; diversity of ownership; accommodation of the dominant tenement; and a right capable of forming the subject-matter of a grant. Dominant land is owned by Peter, and servient land owned by Shauna, satisfying the first two conditions. The shortcut accommodates the dominant tenement in conferring a right of way benefitting the land, as opposed to merely benefiting Peter personally (Hill v Tupper(1863)). The right could indeed be granted expressly: a right of way is a type of easement oft-recognised; it is sufficiently definite; and does not impose any positive obligation or constitute possession of the servient land.
Noting no express rights were granted or reserved by the conveyance made by Maude to Peter, formation may be through implication or prescription. Given the route is a shortcut for convenience, it will not meet the exceptionally high threshold for necessity, nor is common intention evidenced. Wheeldon v Burrows (1878) provides that where an owner sells part of their land, which benefitted from a quasi-easement used by the grantor, retaining the burdened land, the purchaser enjoys an easement. The right claimed need be continuous and apparent; necessary for reasonable enjoyment of the land; and used by the grantor prior to and at the time of the grant. Whilst Maude did indeed transfer part of her land, it is unlikely the shortcut was used if Maude occupied The Firs, fronting the East Road. Furthermore, Wheeler v JJ Saunders (1995) indicates a second access route for mere convenience is not necessary for reasonable enjoyment of land – Peter’s shortcut of convenience would likely not succeed considering this decision. The Law of Property Act 1925 (“LPA”) s 62 provides all ‘…easements, rights, and advantages’ are conveyed with the conveyance; but again, if Maude did not use the shortcut, there is no easement to be conveyed.
Alternatively, Peter may raise the argument of prescription, which operates on the presumption that the right was granted by deed at some point in the past. User dating back to ‘time immemorial’ (1189) is easily rebutted in the present case, as the tenements were in common ownership before 2001. Instead, the lost modern grant doctrine may apply: where an easement has been enjoyed uninterrupted for 20 years or more, the law adopts the legal fiction that a grant was made, regardless of any evidence it was not made (Dalton v Angus (1881)). The Prescription Act 1832 s 2 confirms use ‘as of right’ for 20 years without interruption creates an easement.
Prescriptive right must be exercised nec vi, nec clam, nec precario – without force, secrecy, or permission (R v Oxfordshire County Council (2000)). Whilst reason would suggest Peter likely obtained permission at some point, Welford v Graham (2017) clarifies that if an easement was used openly for the necessary time period, a rebuttable presumption exists that it was enjoyed without permission. The servient owner need adduce rebutting evidence that there was permission, or opposition. Whilst protest from the servient owner can prevent user as of right (Eaton v Swansea Waterworks (1851)), it appears Shauna is too late to do so in 2021.
Therefore, assuming the right has been enjoyed uninterrupted for 20 years between 2001-2021, a right of way through The Firs garden is presumed by prescription. Prescriptive easements generate a legal interest in land; and can constitute an overriding interest under the Land Registration Act 2002 sch 1(3) and sch 3(3), surviving registered dispositions unless it would not have been obvious on careful inspection. Easements are proprietary interests, capable of surviving change in ownership – as a sidenote, an argument he enjoyed license to enter the land would fail, as licences confer a right in personam and would not survive the change in ownership. Furthermore, Shauna cannot avail of overreaching, as such only overrides equitable interests, and requires a conveyance to take place – transfer by will falls outside the definition of conveyance (s 205(1)(ii)).
The Water Pipe
Shauna must establish The Firs benefits from an easement by reservation to uninterrupted passage of water via the underground pipe. Such a right satisfies the forestated characteristics of easements and Ellenborough criteria, and has been recognised as early as Goodhart v Hyatt (1883). In the factually similar case Rance v Elvin (1985), it was decided the servient owner cannot interrupt passage without being liable for actionable interference and damage. However in that case reservation was express – the easement in the present case may operate as an implied or prescriptive reservation. The difficulty here is courts are more reluctant to imply easements by reservation than by grant – if the grantor wishes to reserve any right, they have a duty to reserve it expressly (Wheeldon v Burrows).
Turning first to prescription, inferably the right to passage of water continued for 20 years or more. The problem here is the nec clam (without secrecy) requirement. This undermines protection of underground or hidden structures, as in Union Lighterage v London Graving Dock (1902) and Walby v Walby (2012). Thus, Rance can be distinguished from the present case as the express easement eliminated the issue of secrecy. Prescription operates under the assumption that the landowner acquiesced to long user – this cannot be the case if the servient owner is unaware of the user (Union Lighterage).
Unlike implied easements by grant, implied reservations only arise through common intention or necessity. Necessity, although normally applied to rights of way, is not restricted to such: in Wong v Beaumont Property Trust Ltd (1965), the claimant was granted an easement to install ventilation necessary for compliance with safety standards. There is an exceptionally high threshold, in that without the easement the property retained cannot be used at all (Union Lighterage). Availability of an alternative water supply could potentially devastate this case, but there is arguably urgent physical necessity for water. Supportive academic commentary might be cited: the lack of useful precedent in this area is criticised, potentially attributable to the wide range of other, more purpose-fit rules creating easements rather than a legitimate need for narrowness (Jackson, 1981).
The Bungalow Building
Shauna must establish the restrictive freehold covenant prohibiting building on The Laurels without consent of the owner of The Firs remains valid, despite title having passed from the original covenantee (Maude) to Shauna. Successive enforceability requires the benefit and burden of the covenant to have run with the land. Burden remains with Peter, but Shauna need prove benefit has passed from Maude to her.
At common law, benefit passes to successors in title if certain conditions are satisfied. The covenant must touch and concern the benefitting land (Rogers v Hosegood (1900)), i.e. affect the nature, mode of user, or value. Building on land adjacent to The Firs will impact the appearance and property value, particularly of the gardens – perhaps the reason for the covenant’s formation. The original covenantee must have held legal or equitable estate, and the claimant must hold legal estate – this is evidenced on the facts. The benefit of the covenant must have been annexed to the legal estate, either expressly by deed, or by operation of LPA s 78. Under this section, covenants are assumed to run with land and benefit successors in title (Federated Homes v Mill Lodge Properties (1980)), so benefit passes to Shauna in law (as well as equity, which carries lesser requirements).
Shauna may therefore seek an injunction to stop Peter building the second dwelling, granted at the court’s discretion. Following Jaggard v Sawyer (1995), an injunction is the normal remedy unless damage is small, capable of monetary valuation, compensable by small money-payment, and the injunction oppressive. Given the nature and impact of breach, it is likely Shauna could successfully prevent construction. Planning permission does not override restrictive covenants; however, Peter might apply to the Lands Tribunal under LPA s 84(1)(aa) for discharge of covenant on the basis it impedes some reasonable user of land. This would be difficult to establish – although planning permission may indicate reasonableness, public policy does not come into play here (Shephard v Turner (2006)). Given the damage done to the neighbouring dominant property, the covenant provides practical benefit (s 84(1A)).
Conclusion
Shauna should be advised Peter enjoys prescriptive right of way via the shortcut, provided long user has continued uninterrupted for 20 years between 2001-2021. Regarding the waterpipe, prescription is highly unlikely to succeed given the right’s hidden nature; implication by necessity, although equally improbable, cannot be entirely ruled out – the court might be persuaded the law need develop to include amenities essential to use of the property. Finally, Shauna should be able to enforce the restrictive covenant and prevent continued construction via injunction. A practical solution might be reached if Shauna granted the bungalow construction consent, conditional upon Peter repairing and granting an easement over water supply, and expressly releasing the right of way.
PART B: Essay Question
'One possible interpretation of the glut of proprietary estoppel cases in recent years is that defendants had not realised at the time of expressing their intentions the potentially vast consequences of expressing that intention.' (C de Contreras, ‘The Evolving Landscape of Proprietary Estoppel’ [2021] Conveyancer and Property Lawyer 94 at 105)
Critically analyse this statement, drawing on specific examples from the case law and discussing at least one of the two NI cases on the syllabus (Mulholland v Kane, McDermott v McDermott) as part of your answer.
Introduction
The most effective way to analyse this statement on the evolution of proprietary estoppel in recent years is to dichotomise the assertations made: that proprietary estoppel has recently become glutted; and one possible explanation is defendants do not realise the consequences of expressing their intentions. The term ‘glut’ insinuates an excess which is problematic, and also has two possible implications: that there is an excess of such cases going through the courts, or that the legal principles themselves in this area have become magnanimous claimant-ward.
A Recent Glut?
The question of whether the development of proprietary estoppel supports the allegation of a recent glut requires comparative analysis of historic versus contemporaneous caselaw, as to whether the rules have become broader throughout the doctrine’s development.
In the historic case Willmott v Barber (1880), Fry J formulated five probanda for a successful claim. Aside from requiring that the plaintiff had made a mistake and thereby incurred expenditure, onerous conditions concerning the defendant were imposed. The defendant must have known of the inconsistency between his right and that claimed by the plaintiff, been aware of the plaintiff’s mistaken belief, and encouraged the plaintiff’s expenditure. Such requirements clearly place a high evidential burden on the claimant; it was inevitable with time and socio-economic change the doctrine would cast off such ‘rigid shackles’ (Bevan, 2020). Indeed, Fry J acknowledged this potential, noting in his judgment a broad approach and inquiry into the circumstances of the case were required. Nonetheless, application of the Willmott approach continued as late as Crabb v Arun DC (1976).
Taylors Fashion v Liverpool Victoria Trustees (1982) redirected the course of modern proprietary estoppel, formulating four claimant-focussed and considerably more flexible criteria. There need be an assurance or representation made to the claimant, a reliance upon said representation, resulting in detriment to the claimant, and as such it would be unconscionable to deny the claim. Jennings v Rice (2002) deemed these conditions a series of interrelated factors to be applied holistically in a ‘broad-brush’ approach – academics observe there lacks a singular, comprehensive definition of proprietary estoppel (Gardner, 2007).
Each of the four elements has subsequently evolved and expanded. Regarding representations, in Thorner v Major (2009) the House of Lords accepted assurances in the form of hints and remarks made over the years. The Court of Appeal’s finding that the assurances provided no clear and unequivocal intention was reversed; Lord Walker enigmatically redefined the threshold of certainty as ‘clear enough’, stating what amounts to sufficient clarity depends on context. Assurance may even be passive or silent – as in the landowner’s knowing failure to set straight the claimant’s mistaken expectation of entitlement in Cobden Investment v RWM Langport (2008).
Detriment is likewise constructed broadly. Gillet v Holt (2000) affirms detriment is not a narrow or technical concept, and need not consist of quantifiable financial detriment, so long as it is ‘something substantial’. This is epitomised in NI case Mulholland v Kane, where the court took a markedly all-encompassing approach. At age 16, the claimant commenced a relationship with Mr Kane, then in his 40s, which continued for the rest of his life. The claimant undertook considerable work for Kane without adequate pay. Acknowledging the additional detriment to the claimant in effectively debarring herself from prospects of marriage or lifelong partnership with other men in the district, Deeny J deemed Kane’s failure to provide for her via a will unconscionable.
Another way in which proprietary estoppel might be perceived as glutted is in its reoccurrence in various land law modules – estoppel licences; mortgages by estoppel; in easements. Considering the forgoing widening of the requisite elements, the broad approach taken to application, and the multipurpose nature of the doctrine, it is certainly not inaccurate to describe the doctrine as glutted.
The interpretation that defendants did not realise at the time of expressing their intentions the potentially vast consequences of such expression is a possible explanation for a perceived glut in certain cases. This is particularly true given it is not relevant whether the defendant intended the words to induce the detrimental reliance – whether words or conduct would reasonably raise expectations is judged objectively by the court, per Thorner and James v James (2018). However, the interpretation perhaps oversimplifies the caselaw and exonerates defendants, overlooking the requirement of unconscionability. As far back as Willmott v Barber (1880), Fry J recognised the distastefulness of permitting defendants to take advantage of the claimant’s reliance on a promise.
A more accurate explanation might be that proprietary estoppel operates to intervene in situations where misplaced trust has backfired on claimants – not that such trust is necessarily irresponsible, noting the large proportion of cases occurring between family. McDermott v McDermott (2008) is a prime example, where the defendant father made assurances to his son and daughter-in-law, encouraging them to move to NI and expend considerable money and labour in completing the property he had started building for them. However, he did not transfer title to the property, and later executed a mortgage over it for his own benefit, unbeknownst to them. The claimants then also discovered an agricultural restriction clauseover the property of which they were unaware, and asserted they would not have moved to the property or invested in it had they been aware of this devaluing restriction.
Is such extensivity problematic?
A key contention proprietary estoppel raises is regarding impositions made on testamentary freedom. Indeed, de Contreras’ statement is taken from her case comment on Guest v Guest (2019), where the claimant’s father purportedly made assurances that the claimant would receive the farm (or a significant proportion of it). The claimant relied on such in devoting himself to the farm’s success, accepting a wage below the base rate. When relations between the claimant and his family deteriorated, he was excluded from the will. The court found proprietary estoppel operated to entitle the claimant to a lump sum payment equal to 50% of the farming business and 40% of the property, frustrating the surviving defendant’s testament. Yet on the other side of the coin are cases such as Thorner and Mulholland v Kane, where the court has intervened to give effect to perceived unfulfilled testamentary intention.
Given the entrenchment of common law governing operation of wills, criticism is perhaps less concerned with judicial involvement in dispositive power, and more so with the extent of judicial discretion and ‘inherently unpredictable’ outcomes – especially regarding remedy (Conway, 2016). Deep-seated controversy exists regarding the appropriate approach to satisfying the equity. Davies v Davies (2016) placed proportionality at the heart of the doctrine, whilst Guest prioritised simultaneously enforcing the representations made, and compensating for the detriment, in a dual approach. Gardner (2006) suggests a third consideration – the degree to which expectation and reliance can be ascribed to the defendant; whereas Mee (2011) is critical of the innate complexity multiple considerations generate.
The response to critique regarding wideness of discretion is that various internal limitations exist within the elements of estoppel. Ill-defined assurances will not be sufficient, per Orgee v Orgee (1997). Particularly in commercial cases, courts are unlikely to find proprietary estoppel based on a precontractual ‘gentleman’s agreement’, perhaps expecting better safeguarding of one’s own interests in business (Yeoman’s Row Management v Cobbe (2008)). The aforementioned requirement of objective reasonableness acts as a brake on claimant expectations, and judicial application of too broad a brush will likewise be checked (Davies).
Rules of equity equally impose constraint: there must be no bar to equity, and the court must award the minimum equity to do justice. In Graham v Graham (2020), the claimant failed to respect his side of the bargain to run the farm competently. Considering the claimant as not coming to equity with entirely spotless hands, the court would not grant the entirety of the £3m farm as expressly assured, but a minimum equity to reflect these facts. Such cases highlight the merits in the equitable freedom of the doctrine in facilitating remedies tailored to the facts. In McDermott, Stephens J saw the need for a ‘clean break’ in the sensitive circumstances, influencing his decision to order transfer of the property to the claimants. As a defensive mechanism for misplaced trust, the flexibility of estoppel should not be regarded an attack on orthodoxy (Thompson, 1983).
Conclusion
It is understandable why proprietary estoppel demonstrates judicial discretion in its most discretionary form, as an equitable doctrine created to combat unconscionability and mitigate the rigours of strict law. The doctrine has expanded and broadened throughout its development, generating what might be considered a legal glut. Yet the positive consequence of such is there now exists an extensive tableau of caselaw illustrating how the doctrine interacts with factual matrices. The limits of the doctrine have thus been expansively tested, providing precedents to govern future application of the doctrine by analogy.