Proprietary estoppel and constructive trusts (again)

In Brightlingsea Haven Ltd v Morris ([2008] EWHC 1928 (QB)) BHL was the tenant of a caravan site. Its sister company HLL sold lodges on the site. At law, the owners were periodic tenants. They took the lodges on the basis that during 42 days of the year they would not be used at night and that, during that 42 day period, they could only be used for certain restricted purposes during the daytime. Many lodge owners had, however, sold their previous homes and bought their lodges on the basis of assurances that:

(i) they would be tenants;

(ii) they would have security of tenure until the termination of BHL’s lease of the caravan park;

(iii) lodges could be freely occupied during the daytime in the 42 day period but could not be used at night; and

(iv) rent was payable quarterly and might rise each year (to reflect certain expenses which were used to calculate the rent).

The assurances given by DHL were held to bind its sister company BHL. They gave rise to an equity (both proprietary estoppel and constructive trust). The precise form of relief was left open by the court for the time being. There is much discussion of the interaction of constructive trust and proprietary estoppel and the potential impact of section 2 of the Law of Property (Miscellaneous Provisions) Act 1989.

Michael Lower

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