Family businesses are built not just on hard work, but on trust, expectations, and informal promises passed down through generations. When that trust breaks down, disputes can quickly become both legally complex and emotionally charged.

Proprietary estoppel is one of the key legal doctrines that the courts use to resolve these situations. It can provide a remedy where a person has relied on a promise relating to land or property, only to find that promise is not honoured.

‘We often see proprietary estoppel claims arise in the context of farming families, where lifetime commitments have been made on the basis of promises that are never formalised,’ says Craig Smith, Partner in the Dispute Resolution team at Wollens. ‘These claims can be highly sensitive, as they tend to involve both significant financial value and deeply personal family relationships.’

Craig looks at what proprietary estoppel is, how it arises, and why it so frequently features in agricultural disputes.

What is proprietary estoppel?

Proprietary estoppel is a legal principle that can prevent a landowner from going back on a promise or assurance relating to property where it would be unfair (or “unconscionable”) to do so.

In broad terms, a successful claim requires three key elements:

• A clear promise or assurance
  • This does not need to be in writing. It can arise from repeated statements, conduct, or a shared understanding.

• Reliance on that promise
  • The claimant must have acted in reliance on what they were told.

• Detriment
  • The claimant must have suffered a loss or disadvantage as a result of that reliance.

If these elements are established, the court has a wide discretion to grant a remedy. This can range from awarding a financial sum to granting an interest in land or even transferring property outright.

A common example – family farms

Proprietary estoppel cases often arise in farming families.

A common example is where a child works on the family farm for many years – often for relatively low pay – on the understanding that they will one day inherit the farm, or a significant part of it. The assurance may be explicit (e.g. “one day this will all be yours”), or it may build up over time through repeated statements and conduct.

However, when the parent dies or changes their will, the farm may instead be divided equally amongst all children, or left to someone else entirely. The child who has devoted their working life to the farm may then choose to bring a proprietary estoppel claim.

How else can proprietary estoppel arise?

Although farming disputes provide some of the most well-known examples, proprietary estoppel can arise in a wide range of situations, including:

• General inheritance assurances
  • A parent or relative repeatedly assures someone that they will inherit a house or other property, leading that person to make life decisions based on that expectation.

• Promises linked to care or support in later life
  • An individual may be encouraged to care for an elderly relative with assurances that they will be “looked after” or receive the relative’s property in return.

• Business succession
  • One party may dedicate years to building a business on the understanding that they will ultimately acquire ownership or a defined share.

These cases often arise in the absence of formally documentation. Proprietary estoppel acts as a means of achieving fairness in cases such as these where arrangements have been built on trust.

Why are these disputes so complex?

Proprietary estoppel cases are often evidentially and emotionally complex for several reasons. Promises and assurances are rarely recorded formally, meaning cases can rely heavily on witness evidence. To add to this difficulty, these assurances are often made over a long period of time, meaning recollections can be inconsistent, and relevant documents can be lost.

The family dynamics also complicate matters. Proprietary estoppel cases frequently involve close relatives, which can make any claim very emotionally taxing. It is also common for multiple parties to have competing expectations, particularly where siblings are involved or where wills have been changed over time.

How we can help

Proprietary estoppel claims require careful handling, both legally and tactically. Early advice can be crucial in preserving evidence, managing family dynamics, and exploring settlement where possible.

At Wollens, our Dispute Resolution team has extensive experience advising on proprietary estoppel claims, particularly in the context of farming and family-owned businesses. We understand the importance of balancing robust legal strategy with a sensitive and practical approach.

We also work closely with leading senior counsel on complex matters of this nature, ensuring our clients benefit from the highest level of specialist expertise when navigating these challenging disputes.

‘Whether you are seeking to bring a claim or defend one, it is essential to understand both the legal principles and the broader context,’ Craig adds. ‘Our role is to guide client through that process and work towards the best possible outcome in what are often very difficult circumstances.’

You can also complete an online enquiry form. One of the Wollens team will contact you as soon as they are available.