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9.2.3 Licences and Proprietary Estoppel Lecture – Hands on Examples

Given that we have been examining two discrete areas of property law, it makes sense to separate the elements that guide the application of each of these forms of property rights. Thus, when analysing a problem question pertaining to these areas, we can summarise the steps taken as follows:

Licences

(Establishing that the right is a licence):

  1. Is the person claiming a right of occupation?
  2. Has the landowner granted permission to remain on the land but has not granted any further rights e.g. the right to possess the land?
  3. If yes, go to steps 4 and following below.

(Establishing the type of licence):

  1. Is the licence a bare licence?
  2. Alternatively, is it a licence coupled either with an equity or an interest?
  3. If neither of the above, the licence is a contractual licence.

If you answer “yes” to 4, the licensee may be excluded at any time (remember: arbitrary exclusion). If you answer “yes” to 5, the licensee can remain on the land for a set duration and may have rights against third parties. If you answer “yes” to 6, the licensee’s rights of occupation will last only according to the term set by the agreement.

Proprietary estoppel

(Establishing that the right is a proprietary estoppel):

  1. Has there been a clear and unequivocal statement relating to a promise of a specific asset, or assets, in exchange for a certain act or acts? If not, go to step 5.
  2. If “yes”, has the person to whom the statement was made altered their position to their own detriment? If not, go to step 5.
  3. If “yes”, has the person who made the statement since revoked that statement in a manner which disadvantages the representee and is done in a time and manner which is unconscionable? If not, go to step 5.
  4. If “yes” to all the above, there is a right of proprietary estoppel.
  5. If “no” to any of 1-3, there is no proprietary estoppel.

Q1. Albus and Bertha purchase a house and they allow their son-in-law, Charlie, to live with them. Charlie offers to improve some of the roof tiles and construct a conservatory at his own expense. Albus agrees to this and says Charlie can live in the house rent-free for the rest of his, Charlie’s, life if he does so. Bertha is aware of the arrangement, and does not expressly agree or disagree to it/ Charlie thus conducts those works. Some years later, Albus has died and Bertha needs to adapt the house for her own needs. She needs to have Charlie excluded from the property.

Advise Bertha.

Q2. Dangerous Productions (DP) are hoping to stage a risqué political event at an events centre in Ealing for five consecutive nights. Ealing Borough Council, owners of the centre, agree to let DP stage the event upon payment. DP duly make the required payment. After the first night, Ealing Council receive complaints about the language used in the production, and decide to “uphold the morals of the community” by forbidding DP from entering the centre again to stage the subsequent events.

Advise DP.

Q3. Frank is the owner of Blackacre. He invites Geoff over to the property, and upon seeing his guest says Geoff can “stay for as long as he likes.” No money changes hands. Geoff stays for several weeks. The two get into an argument and Frank tells Geoff that Geoff has to leave. Geoff refuses, saying he was entitled to stay.

Advise Frank.

Q4. Zack owns Whiteacre, a large plot of farmland. He invites an acquaintance, Yasmin to the farmland. She tells Zack that she has long wanted to work on a farm, and starts to do so without payment. Zack is impressed by the quality of her work and amends his will to say that Yasmin would be entitled to a portion of the farmland. As she continues to work on the farm, Zack further amends his will, increasing the size of Yasmin’s portion of the farmland. Zack and Yasmin fall out, and Zack amends his will in such manner that Yasmin would not be entitled to any part of Whiteacre.

Advise Yasmin.

A1. This case follows the precedent set by Sledmore v Dalby. As you will recall from that case, the passage of time and the changing needs and priorities of the parties was such that the equity, which had validly arisen, was now extinguished. Following this precedent, Bertha is free to exclude Charlie from the property without needing to compensate him.

A2. This is a contractual licence situation: payment has been made for temporary occupation of space owned by the landowner for a fixed duration. Given that Ealing have attempted to interfere with the exercise of the contract by prematurely revoking the right of access and occupation, DP are entitled to continue staging their event for the duration stated in the licence, and to force Ealing to let them stage the event (see Verrall v Great Yarmouth BC).

A3. The situation here is that of a bare licence. This is because there is no exchange of money. As the owner, Frank is at liberty to revoke permission for occupation of the property at any time. There does not appear to be any grounds of necessity or public purpose, therefore Frank can lawfully arbitrarily exclude Geoff from the property.

A4. The facts in this case resemble the facts in Gillett v Holt. As you will recall, in that case all of the elements of proprietary estoppel were found to subsist, such that they overcame the usually revocable effect of a will to make the representations ‘tantamount to a promise.’ We see that in this case: unpaid work, promises of land being made for ever-increasing size, and then a resiling from those statements. Therefore, Yasmin is entitled to compensation and, following Gillett, the plot of land heretofore promised to her.


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