Proprietary Estoppel, Constructive Trusts and Section 2 of the Law of Property (Miscellaneous Provisions) Act 1989
| Author | Imogen Moore |
| DOI | http://doi.org/10.1111/1468-2230.00302 |
| Published date | 01 November 2000 |
| Date | 01 November 2000 |
Proprietary Estoppel, Constructive Trusts and Section 2
of the Law of Property (Miscellaneous Provisions) Act
1989
Imogen Moore*
As is well known, section 2 of the Law of Property (Miscellaneous Provisions) Act
1989 effected a fundamental change in the law respecting formalities for contracts
relating to land, rendering the doctrine of part performance obsolete.1Yaxley v
Gotts2presented the Court of Appeal3with the opportunity to determine how far
other equitable remedies, in particular proprietary estoppel, survive the new
provisions. Regrettably, the court did not deal with the question as clearly as might
have been hoped. Although the judges unanimously recognised the claimant’s
informally created property rights, the judgments did not fully explore the
relationship between section 2, constructive trusts and proprietary estoppel. The
extent to which equitable remedies can protect a claimant falling foul of section 2
accordingly remains obscured by opaque judicial reasoning.
The facts
The claimant, Mr Yaxley and the second defendant, Mr Brownie Gotts were
friends of long-standing. Mr Yaxley was a self-employed builder who had worked
for Brownie Gotts on previous occasions. In 1991 they orally agreed that Brownie
Gotts would buy a property in Cromer to be refurbished and let out as flats. Mr
Yaxley would carry out the work at his own expense and thereafter act as
managing agent of the property. In return, the ground floor (which would comprise
two flats) would be his ‘for ever’.4This scheme was put into effect, but with the
modification that the property was purchased by the first defendant, Alan Gotts
(Brownie Gotts’ son). Mr Yaxley duly carried out the refurbishment and once the
flats were let he acted as managing agent, collecting and delivering the rents to
Alan Gotts, who would pay rent for two flats to Mr Yaxley.
In 1995 the parties fell out and Mr Yaxley was excluded from the property. He
commenced proceedings seeking a 99-year lease of the ground floor flats on the
basis of proprietary estoppel. At first instance the judge broadly accepted Mr
Yaxley’s evidence. The judge identified a representation (in the shape of the oral
agreement and continued acquiescence by Alan and Brownie Gotts) and
detrimental reliance, and awarded the order sought.
ßThe Modern Law Review Limited 2000 (MLR 63:6, November). Published by Blackwell Publishers,
108 Cowley Road, Oxford OX4 1JF and 350 Main Street, Malden, MA 02148, USA.
912
* School of Law, University of Birmingham.
Thanks are due to Jonathan Harris, John Stevens and the anonymous reviewer for their helpful comments
on an earlier draft of this note.
1 The general consensus that the repeal of section 40 of the Law of Property Act 1925 had abolished
part performance was troubled to some degree by dicta of Neill LJ in Singh vBeggs (1996) 71 P &
CR 120, noted [1997] Conv 293 (S. Swann). The present case confirms that part performance has
successfully been laid to rest.
2 [2000] Ch 162.
3 Robert Walker, Clarke and Beldam LJJ.
4 n 2 above, 186.
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