Licence coupled with an equity

In Inwards v Baker ([1965] 2 QB 29, CA (Eng)) a father told his son that the son could build a house for himself on the father’s land. There was never any commitment (contractual or otherwise) to transfer the land to the son. But the father had led the son to believe that he would be able to live in the house on his father’s land for the rest of his life. The son did all the work involved in building the house and he shared the cost with his father. The father died and the trustees of the will sought to recover possession of the house from the son. They failed. The Court of Appeal pointed to Dillwyn v Llewellyn Ramsden v Dyson  and Plimmer v Wellington. The elements of proprietary estoppel were present. The son had been encouraged to believe that he could live in the bungalow for the rest of his life. He had an equity that (according to Lord Denning MR) would be binding on third parties with notice of it. Lord Denning said that the son had a licence coupled with an equity.

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