Value judgment: Suggitt v Suggitt

The Court of Appeal’s decision in Ilott v Mitson [2011] EWCA Civ 346 indicated how difficult it is to bring a successful appeal in a claim for reasonable financial provision under the Inheritance (Provision for Family and Dependants) Act 1975.

Even though the award at first instance was at the top end of what many practitioners considered to be reasonable financial provision for the claimant, the Court of Appeal held that an appellate court should not interfere in the value judgment made by the trial judge unless ‘plainly wrong’.

In the recent case of Suggitt v Suggitt [2012] EWCA Civ 1140, the Court of Appeal has indicated that it will be equally difficult to overturn on appeal decisions of a trial judge as to whether or not there has been detrimental reliance upon an assurance sufficient to give rise to a claim in proprietary estoppel.

Case facts

Frank Suggitt died on 25 October 2009. His estate, which was valued at around £4m, included some 400 acres of farmland in north Yorkshire, several houses and cash of £150,000.

Frank was the divorced father of four children. Two of his children were not parties to the proceedings, which were brought by his youngest child and only son, John, against one of his daughters, Caroline. At the time of Frank’s death, John occupied one of the houses adjacent to the farmland and Caroline occupied another.

By his will, which was executed in 1997, Frank gave his entire estate to Caroline, but subject to a non-binding expression of wishes that “if at any time my son John Michael Suggitt shall in the absolute discretion of Caroline show himself capable of working on and managing my farmland she shall transfer my farmland to him”.

It was John’s case that Frank had given him an unconditional promise that some day at least the farmland and, by implication, somewhere to live, would definitely be his following his father’s death.

His Honour Judge Roger Kaye QC, sitting as a deputy High Court judge, heard evidence from John and several other witnesses. He was critical of John and found that he was not a reliable witness.

He found that John was a disappointment to his father, who did not consider him fit to run the farm. Although John has been to agricultural college (at Frank’s expense), he had failed to complete the course. Frank had offered to take his son into partnership but John had refused.

John had gone to live with friends in York but, despite receiving an inheritance of £38,000 from a great aunt, he ran out of money after nine months and had to return to the farm.

When John left for York, Frank decided that he could not manage the farm on his own and, accordingly, entered into a farm sharing arrangement with another farmer unconnected with the family. Previously, John had assisted his father with the harvest and sale of grain.

In assessing his evidence, the judge described John as ‘apt to grumble’ and complain that his father gave him no wage, and noted that he seemed to overlook entirely the fact that Frank paid for his food, board and lodge, living expenses and gave him a share of the grain harvest (described by John as the ‘sweepings’ or ‘left overs’ but in fact worth about £4,700).

Intermittent work

When John returned from York, the whole of the farm was being managed so John mainly worked elsewhere. Although he refurbished one of the houses, the work was intermittent because he was fully employed elsewhere.

In 2006, Frank took back 30 acres for John, so that he could set up a business breeding poultry and rabbits. John’s partner, who lived with him at the farm, ran a livery business on the land.

Notwithstanding the judge’s findings, he nevertheless was satisfied that Frank had repeatedly made promises to John that the farmland and, by implication, somewhere to live, would be his following his father’s death.

Caroline’s case (which was based largely on the terms of the will) was that such promises were conditional upon John’s proving himself. The judge disagreed: although “John was a disappointment to his father... his promises and assurances to his son, as a loving father, were unconditional”.

The judge then considered the elements of detriment and reliance. He found that John had received benefits from his father and that he had overstated the amount of work that he had done but accepted that he had not been paid a wage. He went on: “I regard John’s case and evidence in support as weak. But enough is enough... John did not work for nothing, but he did not work for as much as he might have expected had he been an agricultural worker”.

Although the judge described the detriment as “nothing like the sort of work done in Thorner v Major” [2009] UKHL 18, he nevertheless held that it could fairly be said that John had acted to his detriment or changed his position in reliance on the assurances.

In the circumstances, the judge held that it would be unconscionable to deprive John of his reasonable expectation. After considering at length the relief that should be granted, he concluded that John should receive the farmland plus the property that he was occupying at the time of his father’s death.

Although Caroline did not seek to challenge the finding of the judge that there were unconditional promises made to John, she sought on appeal to challenge the judge’s findings and conclusions in relation to detrimental reliance and the relief granted.

Appeal dismissed

It was held by the Court of Appeal (Sir Nicholas Wall P, Arden and Sullivan LJJ) dismissing the appeal:

1. Six submissions were made on Caroline’s behalf. The first was that the weaker the evidence that promises were made, the stronger the evidence had to be of reliance and detriment.

Arden LJ (with whom the President of the Family Division and Sullivan LJ agreed) dismissed this submission shortly. There was no doubt that assurances had been made: the judge had so found and his finding was not being challenged. Therefore, the court had to consider reliance and detriment on the basis that promises had been made. Where doubt is raised as to whether assurances have been given, the court may look for confirmation to the strength of evidence about reliance and detriment – ‘the requirements of proprietary estoppel are not watertight requirements’ – but that principle had no application in the present case.

2. The second submission was that although reliance and detriment were overlapping categories, they must still be satisfied individually. That submission was simply described as “unexceptionable”.

3. The third submission was that reliance needs to be ‘real’. It was argued that John had only ever done what was in his best interests and what had suited him at the time and that, therefore, he had not suffered detriment to any material degree. In the circumstances, it was not reasonable for him to rely on the promise that he would receive the farm.

The fact that John had gone to York, it was argued, showed that he did not feel tied to the farm. Arden LJ dismissed the latter point, holding that John was young and that there was no evidence that he had gone to York with a view of never coming back. She did accept, however, that the detriment must be ‘real’ or ‘substantial’.

As Walker LJ stated in Gillett v Holt [2001] Ch 210: “Whether the detriment is sufficiently substantial is to be tested by whether it would be unjust or inequitable to allow the assurance to be disregarded.”

Arden LJ accepted that there were substantial benefits to John in living at the farm and that the amount of work done by him was limited. The judge’s findings were, however, clear: he was satisfied that there was both reliance and detriment. As Arden LJ noted: “It was for the judge to determine as a matter of fact and evaluation whether there was sufficient reliance and detriment. We can only interfere with the judge’s judgment if it was perverse or clearly wrong.”

The judge had heard a substantial amount of evidence and had concluded that John had positioned his whole life on the basis of the assurances given to him. This was a conclusion he was entitled to reach. A successful challenge to that conclusion would have to be on the basis that the judge’s evaluation was perverse.

4. Caroline’s fourth submission was that there had to be a significant change of position. This submission was dismissed as raising no new point. The judge had considered change of position as an alternative to detriment. Despite the substantial benefits received by John, an appellate court could not interfere with the judge’s decision on this point. After hearing the evidence, he was satisfied that there was a real change of position. There was nothing perverse in that evaluation.

5. The fifth submission was that it was not unconscionable for Frank to decide to leave the farm on the terms that he left it. This submission, however, overlooked the fact that unconscionability in this context is unconscionable conduct in failing to give effect to the assurances. Therefore, the fact that Frank might properly have dealt with the farm in the way he did in the absence of the assurances was to address the wrong question.

6. The final submission was that the relief granted was disproportionate and went beyond the minimum necessary to do justice. It was argued that the relief ought to be limited to compensation for the unpaid element of John’s work. Arden LJ accepted that where a claimant’s expectation is out of all proportion to the detriment suffered, the court should recognise that his equity ought to be settled in a more limited way.

Again, however, this was a question of evaluation and judgment. An appellate court should not interfere with a judge’s evaluation unless it was clearly wrong. In this case, it could not be said to be clearly wrong to grant John that which he had been promised.

The decision of the Court of Appeal clearly indicates that questions such as whether there is sufficient detriment or whether the claimant’s expectation is out of all proportion to the detriment incurred are questions of evaluation and judgment by the trial judge, who has the benefit of hearing and assessing the whole of the evidence.

Any challenge to the judge’s evaluation is likely to be very difficult to sustain on appeal: even if the Court of Appeal might have reached a different decision, it will interfere with the trial judge’s evaluation only if it is perverse or clearly wrong.

Joseph Goldsmith is a barrister at 5 Stone Buildings. He can be contacted at clerks@5sblaw.com