The concept of proprietary estoppel has developed considerably in recent years, and many of the relevant cases are drawn from the farming industry – perhaps unsurprisingly given the high capital values involved and the exclusive commitment which participation in a farming business requires.
The general proprietary estoppel concept is that, where the relationship between the deceased and his or her descendants is such where a promise is made to (usually) family members, as to their inheritance, they act on the basis that that promise will be kept, but ultimately suffer financial loss as a result, the court may overturn an otherwise valid Will.
The matter was tested in 2022 in the case of Mate v Mate, where a farm was left to two sons and a daughter was excluded, notwithstanding that she had carried out extensive work on the farm to obtain development permissions for some 250 houses. In this case, the court ordered that the sister had contributed to the enrichment of her brothers and awarded her a percentage of the development uplift but found insufficient evidence to overturn the distribution of the estate which had taken place some 30 years earlier.
More recently, in the case of Winter v Winter [2023] EWHC 2393, a family of fruit growers developed a substantial business, with three sons joining the farm partnership. Following a dispute in 2015, the father disinherited two of the sons, one of whom had given up the chance of a military career to dedicate his life to the family farm. They subsequently sued to overturn the Will and the High Court found in their favour, noting that, notwithstanding that the sons had prospered as a result of the partnership, they had suffered “the unquantifiable detriment of committing an entire working life to a family business, giving up the chance to build an alternative life elsewhere.” It found that that the parents “had made assurances to their sons, leading them to believe they would receive equal shares in the business” and “that it would be unconscionable for (the) estate to renege on these assurances.” It awarded each son a one-third share of the father’s interests in the partnership and the company. The matter went to the Court of Appeal in June 2024, where the High Court's decision was upheld, agreeing that the two sons had suffered detriment by committing their working lives to the family business in reliance on their parents' assurances.
The continuing development of the estoppel concept serves as a reminder that Wills are not necessarily sacrosanct and, in the circumstances of a family business, all factors need to be taken into account.
*The views expressed are the author's and not ICAEW's