Court of Appeal Decision
Southwell v Blackburn 2014
Full Judgment
A Court of Appeal decision illustrated how sometimes a promise made in relation to property can become binding even if the usual written formalities have not been completed. This situation often arises when couples live together and then end their relationship. If they are not married to one another they cannot rely upon the extensive Divorce Laws and Reported Cases which exist and which help them to identify how husband and wife would deal with their property and financial affairs in a fair manner.
Couples who are not married often find that they have very few legal rights and that can come as a big surprise and a problem. For those who are not married rights might well be limited to those relating to children as specified under the Children Act and and those relating to property where the property position is set down and clearly identified in writing. Unmarried couples have no right to claim maintenance from one another and generally can’t claim a lump sum payment from one another or even a share of the other’s pension fund. Sometimes this leads to a real injustice and one party to a relationship can be left with very little, if anything, not even a home to live in.
The decision of the Court of Appeal dealt with the long established principle of Proprietary Estoppel. Where this principle is applied it prevents the owner of the property denying the other party something which has been promised to him or her in relation to that property if the outcome would be a gross injustice. In such cases there has to be a promise or assurance and a situation where the other party relies upon the promise or assurance to his or her detriment. In that event the courts will try to ensure that promises made are honoured where it is fair and appropriate to do so. The Court will not allow unreasonable or “unconscionable conduct”.
This is a longstanding but little known legal remedy and it means that in relation to property a promise can be for life and not just until someone decides to change his or her mind. Promises can be binding in this context even if they are not confirmed in writing. These rights apply regardless of gender and may for example help anyone who has relied upon the promise of another to provide him or her with property or security for the future in the form of a home.
This is a timely reminder of the available remedy and how the courts strive to ensure that an injustice does not occur simply because someone decides at a later date to change their mind and break a promise made. Sometimes it’s right and fair for the courts to step in and ensure the promises made turn out to be promises honoured. Reneging on a promise in this context is no longer free of adverse consequences. In cases of this kind it is always best to seek expert and specialist legal advice.
For more information regarding Proprietary Estoppel or Cohabitation Agreements please contact a member of the Family Team on 01905 721600