Proprietary estoppel: Dillwyn v Llewellyn

A donor can be bound by an assurance that land has been given when the donee, with the donor’s knowledge, spends a substantial sum of money on the land.

In Dillwyn v Llewellwyn ((1864) 4 De G.F. & J. 517, 45 E.R. 1285, HL) a father gave his son possession of the land and a memorandum that he had made the gift so as to provide a dwelling-house for him. The son spent a large sum to build a house on the land. The father died. Was the gift of the land effective notwithstanding the failure to abide by the proper formalities to transfer title in the land to the son? Was this a case of an imperfect (failed) gift so that the land belonged to the father’s estate?

Lord Westbury held that the freehold in the land had been transferred to the son:

‘So if A puts B. in possession of a piece of land and tells him, “I give it to you that  you may build a house upon it” and B. on the strength of that promise, with the knowledge of A., expends a large sum of money in building a house accordingly, I cannot doubt that the donee acquires a right from the subsequent transaction to call on the donor to perform that contract and complete an imperfect donation which was made.’ (at 522)

The analogy with part performance is alluded to and there is an attempt to look at this in orthodox contractual terms but this was a gift.

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