Steels v Steels [2023] EWHC 2985 (Ch)21 November 2023

Published: 04/12/2023 22:05

Fancourt J as Vice-Chancellor of the County Palatine of Lancaster. Mother’s successful appeal against the finding that her son had a beneficial interest in her home arising from proprietary estoppel.

The appellant (A) bought a new family home with H, now deceased, when their sons were adults. Their sons paid nothing towards the purchase price but lived with them. The respondents were son Darren Steels (R1) and his partner Emma Steels (R2). They lived in the property until their relationship with his mother soured. The respondents claimed a constructive trust or estoppel enabling them to obtain a share in the property because of assurances given to them by A and H.

This was an appeal against a recorder’s finding that the Rs had a 27.5% interest in the property (CITC not found). The recorder found detriment suffered by the Rs was because the longer they stayed there the more difficult it would become to find a mortgage, and that they would have positioned their lives differently were it not for assurances from the parents that they could stay and would inherit a share in that property (despite the Rs’ plans to leave). The Rs had relied on this for 25 years and A would need to compensate them for this reliance and detriment.

Permission to appeal was granted for the quantification of the interest but not the finding an equity. Later Fancourt J gave permission to appeal on the basis of the finding of an equity as well as its quantification.

A’s grounds of appeal were:

  1. It was wrong to find a promise or assurance of sufficient strength and clarity.
  2. The recorder erred in taking a broad view of the detrimental reliance of the respondents and in concluding that, as in other cases cited to him, the respondents had centred their lives around the assurance of being able to live in the Property.
  3. The recorder failed to make any adequate assessment of the countervailing benefits to the respondents of living in the Property for 25 years, as compared with the monies that had been spent on the Property during that time, and so erred in concluding that there was some detrimental reliance.
  4. As there was no or little detrimental reliance, the recorder erred in concluding that the appellant was acting unconscionably.

The Recorder’s view on unconscionability was based solely on his conclusion that for 25 years the Rs had been positioning their lives on the basis of an assurance given in 1997 about eventual inheritance of the Property. There wan assurance of inheritance but not of a right to live at the property if the parents wanted to sell it. The assurance encompassed the possibility that things would happen which meant that the parents would not be living in the Property at the end of their lives.

There was not sufficient evidence of detriment. The Rs’ statements did not evidence the centring of their lives around the assurance or living to their means. R1’s evidence as to how much money he had saved from not paying rent and the price of the house he was considering buying were evasive and his financial disclosure limited. There was no evidence they would struggle to obtain a loan/mortgage. He had moved his business to the property in 2001 out of convenience. There was no evidence to suggest the Rs spent their savings at all, let alone spent them in reliance on inheriting. The parties were able to save £30,000 from living rent free in that time.

Appeal allowed.

©2023 Class Legal
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