Liden v Burton – Case Summary

Liden v Burton

Court of Appeal

Citations: [2016] EWCA Civ 275; [2017] 1 FLR 310.

Facts

Liden and Burton were a couple who began living together in Sweden in 1995. At the time, Burton was married to another woman with whom he jointly owned a property in the UK (Willow Beck). Burton and Liden moved into Willow Beck in 2001, and Burton divorced his wife in 2002. As part of the divorce, Burton gained sole ownership of Willow Beck after paying his former wife a lump sum. He funded the lump sum by mortgaging his existing interest in Willow Beck.

Before they moved into Willow Beck, Burton told Liden that she needed to contribute financially. This was because Willow Beck was expensive to maintain and otherwise they could not live there. After moving in, Liden contributed £200 a month towards the property’s maintenance.

At a later date when the couple were discussing their finances, Burton tried to describe Liden’s contribution as rent. When Liden challenged him, he grudgingly agreed that it was money ‘towards the house’. Burton also promised to make Liden the beneficiary of his will.

In 2013, Liden and Burton’s relationship ended. Liden claimed that she had gained an interest in Willow Beck by proprietary estoppel. The High Court held in her favour. The judge granted her a share of the beneficial interest in the property as a remedy. The proportion of the interest was calculated to reflect a refund of what Liden had paid Burton and the amount she could have made had she invested that money elsewhere.

Burton appealed on three grounds:

  1. Any representation he made to Liden was not sufficiently clear or unambiguous and did not promise a specific property interest;
  2. Burton argued that he only made any representations after Liden had started paying him money, so she did not act in reliance on his representations. Burton denied that he had asked Liden to make contributions before she moved in.
  3. The amount Liden paid was too small to amount to a detriment.

Burton also challenged the remedy which the judge granted to satisfy the estoppel.

Issue(s)
  1. Were Burton’s representations sufficiently clear and unambiguous to give rise to proprietary estoppel?
  2. Did Liden detrimentally rely on Burton’s representations?
  3. Did Liden suffer sufficient detriment?
  4. Did the judge grant the correct remedy?
Decision

The Court of Appeal dismissed the appeal. They held that:

  • Burton had induced or encouraged Liden to believe that she was making payments to obtain a beneficial interest in Willow Beck. He did this by making it clear from the outset that they could not live in the house unless she made a financial contribution. Burton had no basis to challenge the High Court judge’s finding that Burton made a representation before Liden began making the payments.
  • The later discussion confirming that Liden’s payments were not rent merely confirmed this – they were not the first representation which Liden could have relied on.
  • £200 a month over a decade was clearly a substantial detriment. Liden would not have made those payments if she knew Burton was going to deny that she had any interest in Willow Beck.
  • Liden therefore detrimentally relied on Burton’s encouragement. It would be unconscionable to let him go back on the impression he had given her.

The High Court judge was therefore correct to hold that proprietary estoppel arose. The judge had a broad discretion as to how to satisfy the equity which proprietary estoppel gave rise to. The judge had not obviously gone beyond the minimum amount required to do justice between the parties. Therefore, the Court of Appeal would not disturb the remedy.

This Case is Authority For…

This case shows that a defendant does not need to specifically refer to a property interest in legalistic language for their representations to be sufficiently clear and unambiguous.

Other

This case also demonstrates one of the ways in which a judge can satisfy estoppel’s inchoate equity: by essentially refunding the claimant’s detriment.