Proprietary Estoppel & Farmers
Proprietary estoppel is, in simple terms, where a person has been promised an interest in a property (such as a farm business) and has relied on that promise to incur costs or make sacrifices (e.g. not taken up a job offer elsewhere) that they would not have done if they had not relied on the promise.
Many of the cases in law involve farmers and the passing on of farming businesses, either on retirement or by inheritance.
A recent case (Habberfield v Habberfield 2018), involved a farm belonging to Frank Habberfield and his wife Jane. The brief details of the case are:
- Frank and Jane Habberfield operated the farm as a partnership and when Frank died the farm passed by survivorship to his wife.
- The couple had 4 children, the youngest of whom Lucy had worked on the farm since childhood and her partner Stuart had also worked on the farm for a number of years. Lucy claimed that her late father had assured her that she would take over the farm when he retired.
- Jane Habberfield opposed the case on the grounds that she nor Frank had never made any promises to Lucy
- Evidence was produced from a surveyor’s letter recording a proposal to include Lucy in the partnership
It was ruled that Lucy had proved her claim to a significant part of the farm – around 45% valued at around £1.2M.
Cases like this could be avoided by obtaining early advice about partnership agreements and agricultural inheritance tax planning. AWB Charlesworth Solicitors have experts in both these areas and would be happy to provide the relevant advice.
Umberto Vietri (Partnership Agreements)
01274 352056 firstname.lastname@example.org
Jenny Barron (Agricultural Inheritance Tax Planning)
18 May 2018