Land Contracts

 Contracts to buy land

 Requirements:
 Current formality requirements for a land contract are in section 2 of the law of property
(miscellaneous provisions) Act 1989
 To be a valid land contract section 2 in effect requires it must be:
 In writing
 They have to contain all the agreed terms expressly agreed by the parties
o There are minimum content/obligations that you must have = parties, property,
consideration (Rossiter v Miller (1878) 3 App Cas 1124)
o If you do have those three things then you do not have a valid land contract
 Signed by both parties
 ^ you have to have all of these three
 If you can not tick all of those boxes then you do not have a valid land contract

The issue is whether this contract valid

The rule comes from the Law of Property (Miscellaneous Provisions) Act 1989 section 2. The rule says
that its got to be in writing, contain all the agreed terms expressly agreed by the parties and it has to be
signed by both parties. The minimum terms that you must have the persons, the land, and the price. That
is the absolute minimum you must have.

What does it mean enforceable

OLD LAW
 LPA 1925, section 40: only applies to pre-1989 (Sept 27th) Contracts
 The old law allowed you to use an oral contract
To be enforceable land contracts require one of the following three formalities methods
 Signed written contract
 Oral contract + written evidence/memorandum or
 Oral contract + part performance
NOW
 A oral contract means precisely nothing when it comes to land

Section 2 of the 1989 Act: What is a signature?

In terms of land contracts what is a signature
 The approach that the courts originally took was that they wanted a ink signature
 However, things have changed.
 Whose?
o May be by or on behalf of the parties : section 2 (3) of the 1989 Act
o Ink/pen signature that shows intention to authenticate
o Typed or printed name In typed letter?
 First post Homes v Johnson (1995), per Peter Gibson LJ
 Obiter views suggesting a limited approach
 1989 act replaces flexible interpretation found in 'ancient baggage' of case law on
1677 and 1925 acts by giving a signature a 'meaning which the ordinary man
would understand'
 But case is to be confined to its own special facts (about buyer's address)
 Out-dated: Law Com 386
 Are digital-e-signatures permitted

 No authoritative ratio on section 2
o Golden ocean group v Salgaocar [2012] EWCA Civ 265 (Email typed signature for
guarantee under section 4 statute of frauds 1677)
o Metha v J Pereira Fernandes SA [2006] EWCH 813
o Ramsay v Love [2015] EWHC 65 (Ch), [7] (obiter: machine written signature)
o Neocleous v Rees [2019] EWHC 2462 (solicitor's name automatically added in footer of
email)
 Lawyer had a automated e signature
 In this case the courts said he had signed it because of the intention. It was all
about intention. Because we are dealing with solicitors - agreeing on behalf of
their clients - it was deemed to be a signature because of the intention involved
 The court in Neocleous v Rees held that the email footer on Ms. Rees lawyer did
in fact constitute a valid signature for the purposes of section 2(3) of the
LP(MP)A
 The courts further added that the ordinary person would regard on automatically
generated email footer as a contractual signature holding that:
"Many an "ordinary person" would consider that what is produced when one stores a
name in the Microsoft Outlook "Signature" function with the intent that it is
automatically posted on the bottom of every email is indeed a "signature" … In the
current age, that would in my judgment be capable of encompassing the wording of
the footer to Mr Tear’s email."
Consequently, the Courts held that email footers, regardless of whether they are
automatic, are capable of amounting to signed writing such that the lawyer had
indeed signed the email on behalf of his client, thereby establishing a legally binding
contract.

 Electronic Execution of Documents (Law Com 386)

o There must be evidence of intention for the signee using any medium to sign to be
bounded by their signature

Courts are more willing to accept that a signature could be your typed name

There are exceptions to this

 Short leases (3 years or less) - see also section 54(2)(d) LPA

How strict is the section 2 requirement

 Keay v Morris Homes (West Midlands) Ltd [2012] EWCA Civ 900, para [9] per Rimer LJ
 "its effect is merciless. An appropriately signed document purporting to amount to a contract for
the sale or other disposition of an interest in land will not in fact create a valid contract unless it
includes all the expressly agreed terms of the sale or other disposition"

Green v Ireland [2011] EWHC 1305 (Ch)

 What is a document
  The question for the court Is a string of emails a document
 Could you print that out in one document - if I could print it out on document then it is section 2
compliant
 On the thinking of Green v Ireland - that should be one document because you can print it out
 Have we a case that says what's app - no we don’t however we have an email - Green v Ireland -
the reasoning of the judge in Green v Ireland is that I can print this document out and it has
everything in one document - which in case a string of emails would comply
 Vitally important in green v Ireland - it was a string of emails - the parties in green v Ireland -
they were replying to each other - the eventual one could be printed on a document
 What's app would appear on that thinking would appear to be section 2 compliant

October 20
 If you contract for land that has to comply with section 2 of the LMPA act
o It must be in writing
o Agreed terms
o Must be signed by parties
 The effect of section 2 is mery less and if you don’t comply with that section then you do not
have a contract it is void
 Section 2 subsection 5 - provides some exceptions to the rule that you have to comply with the
formalities
o If you create a lease for someone for 3 years or less it does not have to be in writing
o If you contract for a lease that is 3 years or less that does not have to be in writing
o Public auctions (when you bid) - formality requirements do not apply

Proprietary estoppel
 "Ian orally promises Phil a lease of the upstairs flat if P renovates the property"
 If the lease is 3 years or less it can be done orally
 Well then Ian refuses to do it
o If on the other hand I was to allow Phil to come in to the flat and redecorate for
preparation of moving in - well then Phil has done something to his detriment - he cant
recover the time for doing this particular thing - they cant recover it because it is not a
contract
 Would it be in good conscious objectively for Ian to deny that lease when we
know that Phil has loosed out
 Proprietary estoppel effectively allows the court to step in to say that you are
relying on your legal rights Ian - you are entitled to not grant a lease but in good
consciousness you are aware that Phil has renovated the flat so you really in good
consciousness you should carry out what you said you were going to do or
compensate Phil
 Could we order Ian to grant a lease to Phil

It is a claim in good concise that I should have something if I can demonstrate four essential
elements of proprietary estoppel
They are that either claimant received a promise or an assurance by a landowner not that I have an
equitable interest in land but that I was going to get one
If I already have one - we have a trustee and I am the beneficiary of a trust but in this case it is not
that you have one it is that you are going to get one at some stage in the future
 An assurance that you are going to get one in the future
 An assurance on which you have to rely reasonably to your detriment.

And finally that it must be unconscionable to deny that interest

 Unconscionable is against good conscience

Summary to claim proprietary estoppel you have to show

 Representation of property rights made to claimant by land owner
 Reliance by claimant
 Detriment suffered by claimant

Lord Walker - Thorner v Major (2009) [29]

 Walker clarified the four points for proprietary estoppel

Lord Walker identified three main elements requisite for a claim based on propreitary estoppel. The first
is that a assurance was given to the claimant; the second is that the claimant relied on that assurance; and
third there was some detriment incurred by the claimant because of that reliance.

Can I claim proprietary estoppel to replace or enforce a void land contract

 Yaxley v Gotts [2000] Ch. 162, CA
 Yaxley orally agreed to rebuild/renovate property being bought by Gotts in return for take the
ground floor
 Builder in London who saw an opportunity to buy. A house which he could divided up and sell it
into flats
 Builder needed to borrow money from his friend Gotts - they reached an agreement where Gotts
said I will buy this house in my name - you go in and do the building work and when you finish
you can have the bottom flat - they shook hands on it
 If you shake hands is that a valid land contract
o No - shaking hands is not section 2 compliant
 Gotts said no to Yaxley - I have conveyed the land to my son (he didn’t convey the land to the
builder) Gotts can not convey the land because I do not own it. Yaxley said you should convey
the land
o The son says I don’t know nothing about this
 Yaxley was given a assurance he was going to get the bottom flat -to which he relied on to his
detriment - he wanted to go to court to say it would be unconfinable to deny me what I was
promised
 Question for court - can proprietary estoppel be used to enforce a void contract (oral)
 Justice
o This idea of proprietary estoppel is similar to a constructive trust
o If I consider this similar then if it was a constructive trust you would get your claim - if I
consider it under this idea of a constructive trust I think you should get a remedy
because constructive trusts are not subject to section 2 formality agreements
 Court ordered - Yaxley awarded a 90 year lease on the bottom flat
 Yaxley was promised the bottom flat - fee simple absolute of flat - they gave him a 90 year lease
- they are not the same thing - it brings into a spotlight the difference between proprietary
estoppel and a constructive trust
o What was upheld in the court - what they awarded him was a remedy for proprietary
estoppel - because proprietary estoppel is discretionary - this case appears to show
proprietary estoppel can be pleaded to render enforceable a void contract in theory
o Law hangs in the balance for some time until case in 2008
 o Cobbe v Yeoman's Row Management (2008)
 Oral agreement that YRM would sell flats to Cobbe once Cobbe had obtained
planning permission at his expense - YRM demanded more money. Court of
appeal found YRM were estopped - but house of lords disagreed
 Cobbe I was given an assurance that I relied on my detriment that I was going to
get a land contract - it would be out of good conscience to deny me a remedy
 'My present view, however, is that proprietary estoppel cannot be prayed in aid in
order to render enforceable an agreement that statute has declared to be void"
(Lord Scott [49])
 Lord Scott's view is that we look at section 2 5 at the exceptions of the
formality requirements - this is not one of those - you were promised that
you were going to get something - that section does not include
proprietary estoppel therefore you cannot claim a contract enforceable
 HOWEVER
 Lord walker - said lets consider your claim - - yet you were given assurance,
you relied on your detriment - however focus on consiability
 He referred to prior case - where they discussed unconsiability - lord justice north
had been considering unconsibaility - focusing on state of mind of the defendant
in that case
 Lord Walker decided against expressing an opinion on the point
 Although an obiter view Lord Scott seems to firmly close the door on arguing
that proprietary estoppel can be used to overcome the absence of a valid
contract that complies with the formality requirements set out in section 2

LORD WALKER PARAGRAPHS 91 AND 92 - HERE UNCONSIABILITY IS BEING

USED AS I THINK IT SHOULD ALWAYS BE USED AS AN OBJECTIVE VALUE
JUDGMENT OF BEHAVIOUR REGARDLESS OF THE STATE OF MIND OF AN
INDIVIDUAL WHICH HAS TO SHOCK THE GOOD CONSCIENCE OF THE COURT

Until you have exchanged contracts the buyer or seller can pull out

The conscience of court is not effected

Walker went on - equity in good consicne of court we can look at this the overall situation we are not
going to is enforce the contract - but similarly there is no reason that yeoman's row management should
benefit from all your hard work - so what we are going to do is to make a ad hoc award to compensate
you for the time and costs so that way mr cobbe you are not out of pocket - their land YRM is more
valuable because of the work you did.
 In the court they did not enforce the contract but they did make sure Mr. Cobbe did not lose out

Lord Scott - you can not use proprietary estoppel that to enforce a valid contract

Then next case

Thorner v Major (2009) [96] - [98]
 Over that time the uncle said to the nephew all the land will be yours when I die (the farm)
repeated many times
 Uncle showed nephew life insurance policy to show that it would pay out the farm
He fell out without his children (the uncle) - picked up his will and destroyed it

When you die without a will it goes to your spouse and then your children. So the nephew was going to
be left without nothing and the children were going to get the farm

A claim was made through proprietary estoppel that the nephew was given an assurance, on which he
relied reasonably to his detriment (his loss of earnings) would it therefore be unconsciblae to deny that
interest

Claim in proprietary estoppel (you would get the farm)

Lord Neuberger - said it was an entirely different situation from Cobbe - farmers family/personal
domestic different than a commercial transaction,
 Would you expect the nephew to know about the formality requirements of section 2 (in writing
etc) - NO
 In which case what we can do is to say that it would be unconsciblae to deny the nephew the
claim because clearly it would strike heavily with the consiability of the court
 Court awarded the nephew the farm

Can we use proprietary estoppel to get away from formality requirements of section 2
 The answer is probably not or Yes

October 25 and 27 (27 starts after third element of adverse possession - is possession adverse?)
 Proprietary estoppel
o You are promised you are going to get something , to which you rely on your detriment
and it would be unconsiable for someone else to go back on the promise
o In order to have a valid land law contract it must comply with section 2 of the LMPA
o Rossiter and Miller rent terms - parties, land, competition date
o If you do not meet those requirements you do not have a valid land contract
o Proprietary estoppel is not specifically named by parliament as an exception to section 2 -
does proprietary estoppel work to effectively force a contract
 Well we have had one case Cobbe - attitude of court was that you could not use it
 Then we have thorner v major - where court seemed to take a different view -
well first one cobbe was commercial parties should have known what they were
doing - however in thorner maybe it is unconsciblae
 There have been mixed approaches to how the courts approach this
 In some cases the courts have said you cannot touch it - if you do not meet the
requirements of section 2 you have nothing however the courts have taken the
view maybe in some circumstances where we can

Another case
 Farmer who worked on family farm for a very long time for very little money - his parents had
promised that when they died they would leave the farm to the son and the daughter - they then
fell out and the parents changed the will - son left employment found employment elsewhere and
then brought a case against them based on proprietary estoppel - I worked for you for 30 years , I
relied on the promise, to my severe detriment because I worked for a long time with a minimal
payment therefore it would be unconsciblae for you to go back on your promise
  This did fulfil the requirements of Proprietary estoppel - the matter for the court is what should
the award be
 First approach - if you have undergone a detriment - you should be reimbursed for your
detriment. One approach is to give damages for the detriment
 The other approach is to say what were you actually promised - because then what we should do
is fulfil that promise in its entirety
 Minority of judges - felt remedy should be to give damages to the detriment however majority
said we disagree - we think that the first thing we should do is to look at the unconsiability
element (Lord Briggs observed numerous decisions had taken that to mean monetary is the
minimum the least we can give - which is in a way giving damages for the detriment - LORD
BRIGGS said he thinks you have to give the minimum to do justice - justice is reversing the
unconsciblae element
 In this particular case what is the unconsciblae part - LORD BRIGGS said unconsciblae part was
not that just that the son could have had a different career- IT IS THE GUT WRENCHING
DISAPPOINTMENT OF THE BREAK OF PROMISE
 The remedy lord briggs said - the first remedy we should look at it - is to enforce the promise that
was made in the first place - what I would do now is force the parents to leave the farm to the son
and daughter. The second element is to say if I do that - is awarding this completely out of
proportion to the overall problem (proportionality) - in this case the answer is NO it would not
have been out of proportion - he worked a super long time
 First approach - see what promise is and enforce it - second approach is to see if it is
unproportionate - if answer is yes then I would have to find a different remedy
Guest v Guest [2022] UKSC 27; [2022] 3 W.L.R. 911
 Remedies:
 Damages for detriment?
 Fulfilling expectations
 Reversing unconscionability
 The minimum equity to do justice - see para 13

If you were to argue that the contract is unenforceable - was she originally promised
something - you are going to get the land - on which you lied to your detriment -
detriment is having a bill - would it be unconsciblae to go back on the promise -
 Assuming you find it is unconisable - according to Lord Briggs in guest v guest - the answer
appears to be is the minimum equity to do justice - what is justice first thing is to enforce the
contract whether it is enforceable or not. Would that be out of proportion - we could enforce the
contract is enforcing the contract out of proportion to the detriment suffered
 Apply guest - could I reach some other remedy that could be proportionate - could be money etc.
 In guest v guest PARAGRAPH 13- because the parent hadn't died - it was hard to force them to
do that. Lord Brigg said that we can do this a number of ways - to give the farm now to your son
and daughter - however that may not work because you rely on this - so what you could do is
create a trust so that the farm will keep you going for the time being but the son already knows at
that point that he has a half share in the farm. Lord Briggs gave parents some choices of remedies
- is justice would be consiable

Does the law recognise a claim of proprietary estoppel where there is no valid land contract (currently,
if/when a claim is possible is disputed/uncertain)
 Can the claimant establish the elements of a claim to proprietary estoppel
 Reminder
 To have a valid land contract you have to be section 2 compliant
 The contract is not the same as a deed
 A deed is what you need to
 You do not need a deed to have a valid land contract
 You do need a deed and registration to transfer legal title of land