Authored By: Eva Kelly
Queen’s University Belfast
Introduction:
McDermott v McDermott [2008] was a significant case decided by the High Court of Justice in Northern Ireland, specifically within its Chancery Division, which deals with matters of equity and trusts. The case is particularly notable for its exploration and reaffirmation of the doctrine of proprietary estoppel, especially in relation to disputes arising within the context of family-held land and informal ownership arrangements. It highlights the necessity for courts to apply this equitable doctrine with both flexibility and fairness, ensuring that justice is served without undermining the principles of certainty in land ownership. The case draws attention to how proprietary estoppel can serve as a crucial mechanism to prevent unfairness where informal assurances or expectations have been relied upon to a party’s detriment. In reaching the final decision, Stephens J extensively engaged with a variety of established precedent case law, using these authorities to build a thorough and reasoned judgment that reflects both legal tradition and equitable principles. The cases and legal reasoning relied upon will be analysed in detail in the subsequent paragraphs, alongside an exploration of the case’s broader impact on the evolution of proprietary estoppel within the wider common law system. This discussion will also consider how McDermott v McDermott contributes to the ongoing judicial effort to balance formal legal rights with informal, equity-based claims, particularly in the emotionally and socially complex realm of familial property disputes.
The fundamentals of Proprietary Estoppel:
Stephens J relies primarily on Gillett v Holt [2000] in order to accurately and proportionally come to a conclusion in this case. The four key foundations needed for a solid case of proprietary estoppel were built upon in Gillett, as is highlighted by Stephens J in this case. Proprietary estoppel requires that assurances are made to the claimant, on which they rely on, which causes them to act to their detriment, and that the respondent’s conduct surrounding the assurances could be deemed unconscionable. This is the case for Patrick and Anne-Marie McDermott, as Stephens J correctly points out by citing Lord Justice Robert Walker in Gillett, ‘The overwhelming weight of authority shows that detriment is required… authorities show this is not a narrow or technical concept’. It could be said that Lord Justice Walker’s words hold a lot of authority, as they are backed up by years of case law defining that detriment is in terms of the claimant, such as in Pascoe v Turner [1979], where the redecoration of the property amounted to sufficient detriment, and in Davies v Davies [2016], where much like with Patrick and Anne-Marie McDermott, the forgoing of better employment for the sake of an assurance was ruled as sufficient detriment. The issue of reliance was also touched upon in Greasley v Cooke [1980], where an effort was made to mold the fundamentals of proprietary estoppel into a more rigid set of rules which judges would have to follow. This case has been treated with caution, however, and while not overtly overruled, Browne-Wilkinson V-C in Grant v Edwards [1986] highlighted that detrimental reliance was not something that could easily be labelled, and that a ‘less stringent test for detrimental conduct applies where proprietary estoppel is in issue’. So, in line with the case law stated above, it can be believed that Stephens J correctly decided that there was a valid claim for proprietary estoppel against Edward McDermott.
Equitable remedies:
Equity was discussed at length by Stephens J in their judgement, concluding that Edward McDermott transfer the property to his son and daughter-in-law, and that they make a payment on his behalf of £70,000 to Mortgage Trust Limited. But, considering the equity and any past judicial intervention on this issue, was this appropriate? Stephens J determined that a house without a mortgage (which would have happened had the claimants had an overriding interest in the property via equity) ‘would also be inappropriate’. This is largely in line with what Scarman LJ stated in Crabb v Arun District Council [1975], ‘what is the relief appropriate to satisfy the equity?… It would be unconscionable… to allow the defendants to set up their undoubted rights against the claim…’. However, Lord Neuberger, in his journal article The Stuffing of Minerva’s Owl?, critiques such a heavy reliance on equity to remedy the actions of a potentially unconscionable respondent, ‘But equity is not… riding to the rescue every time a claimant is left worse off than he anticipated…’. As equity commonly relies on the ‘clean hands’ rule (that many should come to equity with both clean hands and a clear conscience), Lord Neuberger’s critiques seem largely grounded in reason. If a person has made unconscionable decisions, why should equity step in when those who have come to it have not done so with clean hands? That being said, in coming to their eventual decision, Stephens J referred to the cases of Dillwyn v Llewellyn [1862], Maddison v Alderson [1883] (which echoed the fundamentals of Dillwyn) and, most importantly, Jennings v Rice [2002] (which required the court to ‘satisfy the equity rather than being required to satisfy the expectation’ of the claimant), when appreciating the role of equity within proprietary estoppel. And so, despite the unconscionable nature of the defendant’s actions in this case, it would be difficult to argue that Stephens J had not made the right decision in terms of their handling of equitable remedies in this case.
Legal Significance:
There can be no doubt that McDermott v McDermott [2008] created a ripple effect that can be seen throughout any future case law in terms of proprietary estoppel, even in Northern Ireland. Stephens J accurately and articulately underlines the key fundamentals behind proprietary estoppel, present in many future cases, such as Guest v Guest [2022]. Lord Leggatt identifies many of the cases stated above that Stephens J relied on, as well as highlighting the key principles of proprietary estoppel, while still emphasising, as in McDermott, that proprietary estoppel is a flexible doctrine, not tied down by any certain rules or regulations, merely guiding fundamentals, ‘I would emphasise that these are principles and not rules’. As proprietary estoppel is already, at its core, a flexible doctrine, it would be advisable to potentially consider serious reform before implementing it, as it could be believed that very little is necessary in this field. As long as these fundamentals that were mentioned in obiter by Lord Legatt continue to shape its flexible nature, proprietary estoppel should remain a safe and stable doctrine, that can be used as a defensive shield for any potential claimant who feels that a defendant has wronged them.
Conclusion:
To conclude, it can be reasonably argued that Stephens J not only reached the correct decision through a careful and accurate application of the relevant precedent case law, but also ensured that the judgment was firmly grounded in the principles of equity. The decision reflects a thoughtful balance between established legal doctrine and the need to achieve a fair and just outcome. As a result, the ruling was able to satisfy the equitable interests of all parties involved, demonstrating a sensitive and appropriate use of judicial discretion in a context where both legal rights and moral obligations were at stake.
Bibliography:
Case law:
- Crabb v Arun District Council [1975] EWCA Civ 7.
- Davies v Davies [2016] EWCA Civ 463.
- Dillwyn v Llewellyn [1862] 2 GF & J 517.
- Gillet v Holt and Another [2000] 2 All Er 289.
- Grant v Edwards [1986] 3 WLR 114 (Court of Appeal).
- Greasley v Cooke [1980] 3 All ER 710.
- Guest & Anor v Guest [2022] UK SC 27.
- Jennings v Rice [2002] EWCA Civ 159.
- Maddison v Alderson [1883] 8 App Cas 467.
- McDermott v McDermott [2008] NI Ch 5.
- Pascoe v Turner [1979]
Journal Articles:
- Lawson A, ‘The Things We Do for Love: Detrimental Reliance in the Family Home’ [1996], Legal Studies (Society of Legal Scholars) Vol. 16.
- Lord Neuberger, ’The Stuffing of Minerva’s Owl? Taxonomy and Taxidermy in Equity’ [2009] Cambridge L.J.
