Tuesday Law Report: Remedy although agreement was void

6 July 1999 Yaxley v Gotts Court of Appeal (Lord Justice Beldam, Lord Justice Robert Walker and Lord Justice Clarke) 24 June 1999

WHERE A proprietary estoppel arose out of an oral agreement for the sale or disposition of an interest in land, and the facts equally supported the existence of a constructive trust, the plaintiff was entitled to his remedy since, although the agreement was void under section 2 of the Law of Property (Miscellaneous Provisions) Act 1989 because it was not made in writing, section 2 did not affect the creation or operation of a constructive trust.

The Court of Appeal dismissed the defendants' appeal against a decision that the plaintiff was entitled to a leasehold interest in certain property which had been the subject of an oral agreement between them.

The plaintiff claimed to have made an oral agreement with the second defendant to the effect that, in return for the carrying out of certain building works on a property which was divided into flats and which the second defendant proposed to purchase, and in return for acting as the second defendant's managing agent for the flats, the plaintiff would become the owner of the ground floor of the property.

Without telling the plaintiff, the second defendant arranged that his son, the first defendant, should purchase the property. The plaintiff carried out the works and acted as managing agent. Later the plaintiff and the second defendant fell out, and the defendants denied that there was any agreement that the plaintiff should have an interest in the ground floor.

The plaintiff commenced proceedings against the defendants, claiming a declaration and order that he was entitled to a long lease of the ground floor of the property for such term as the court might deem just and equitable; or, alternatively, payment for the value of his interest in the property, or at least that the first or second defendant pay him a reasonable sum for the works and services he had carried out.

The judge found that there was an oral agreement between the plaintiff and the second defendant, and that the first defendant had adopted it. He found that an equity was established to the extent of the plaintiff's ownership of the ground floor of the property, and that he was entitled to that ownership for a term of 99 years. The first defendant was directed to execute a lease within four months unless he paid the plaintiff a sum equivalent to the leasehold interest.

The defendants appealed on the ground that the judge should have held that the oral agreement between the plaintiff and the defendants was void by virtue of section 2 of the Law of Property (Miscellaneous Provisions) Act 1989; and that he was wrong in law to hold that the plaintiff was entitled to ownership of the ground floor by virtue of the doctrine of proprietary estoppel, since that doctrine could not operate to give effect to an agreement rendered void by section 2 of the 1989 Act.

Anthony Allston (Hansell Stevenson) for the plaintiff; George Laurence QC and Louise Davies (Bircham & Co) for the defendants.

Lord Justice Robert Walker said that section 2(5)(c) of the Law of Property (Miscellaneous Provisions) Act 1989 specifi-cally provided that nothing in the section should affect the creation of or operation of, inter alia, a constructive trust. There was much common ground between the doctrines of proprietary estoppel and the constructive trust, just as there was between proprietary estoppel and part performance. All were concerned with equity's intervention to provide relief against unconscionable conduct.

In the present case, although the judge had not made any finding as to the existence of a constructive trust since he had not been asked to do so, it was not disputed that a proprietary estoppel arose on the findings of fact which he had made, and that the appropriate remedy was to grant to the plaintiff, in satisfaction of his equitable entitlement, a long leasehold interest rent free of the ground floor of the property. Those findings equally provided the basis for the conclusion that the plaintiff was entitled to such an interest under a constructive trust, and accordingly he was entitled to the relief sought.

PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs People

COO / Chief Operating Officer

£80 - 100k + Bonus: Guru Careers: A COO / Chief Operating Officer is needed to...

HR Manager - Kent - £45,000

£40000 - £45000 per annum: Ashdown Group: HR Manager / Training Manager (L&D /...

HR Manager - Edgware, London - £45,000

£40000 - £45000 per annum + Benefits: Ashdown Group: HR Manager - Edgware, Lon...

HR Manager - London - £40,000 + bonus

£32000 - £40000 per annum + bonus: Ashdown Group: HR Manager (Generalist) -Old...

Day In a Page

Syria air strikes: ‘Peace President’ Obama had to take stronger action against Isis after beheadings

Robert Fisk on Syria air strikes

‘Peace President’ Obama had to take stronger action against Isis after beheadings
Will Lindsay Lohan's West End debut be a turnaround moment for her career?

Lindsay Lohan's West End debut

Will this be a turnaround moment for her career?
'The Crocodile Under the Bed': Judith Kerr's follow-up to 'The Tiger Who Came to Tea'

The follow-up to 'The Tiger Who Came to Tea'

Judith Kerr on what inspired her latest animal intruder - 'The Crocodile Under the Bed' - which has taken 46 years to get into print
BBC Television Centre: A nostalgic wander through the sets, studios and ghosts of programmes past

BBC Television Centre

A nostalgic wander through the sets, studios and ghosts of programmes past
Lonesome George: Custody battle in Galapagos over tortoise remains

My George!

Custody battle in Galapagos over tortoise remains
10 best rucksacks for backpackers

Pack up your troubles: 10 best rucksacks for backpackers

Off on an intrepid trip? Experts from student trip specialists Real Gap and Quest Overseas recommend luggage for travellers on the move
Secret politics of the weekly shop

The politics of the weekly shop

New app reveals political leanings of food companies
Beam me up, Scottie!

Beam me up, Scottie!

Celebrity Trekkies from Alex Salmond to Barack Obama
Beware Wet Paint: The ICA's latest ambitious exhibition

Beware Wet Paint

The ICA's latest ambitious exhibition
Pink Floyd have produced some of rock's greatest ever album covers

Pink Floyd have produced some of rock's greatest ever album covers

Can 'The Endless River' carry on the tradition?
Sanctuary for the suicidal

Sanctuary for the suicidal

One mother's story of how London charity Maytree helped her son with his depression
A roller-coaster tale from the 'voice of a generation'

Not That Kind of Girl:

A roller-coaster tale from 'voice of a generation' Lena Dunham
London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

London is not bedlam or a cradle of vice

In fact it, as much as anywhere, deserves independence
Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

Vivienne Westwood 'didn’t want' relationship with McLaren

Designer 'felt pressured' into going out with Sex Pistols manager
Jourdan Dunn: Model mother

Model mother

Jordan Dunn became one of the best-paid models in the world