Court of Appeal halts immediate award in dairy farm dispute

Family|May 12th 2014

A woman involved in a rancorous dispute with her parents over ownership of a dairy farm is not entitled to an immediate share in the business, the Court of Appeal has ruled.

In Davies & Another v Davies, her parents had launched proceedings to have her evicted from the Welsh farmhouse where she lived with her two children and partner, after she and her father had a “fight” in the milking parlour.

The family had reportedly had a rocky relationship and had frequently argued. The woman had worked on the dairy farm for different periods of her adult life, and had been told that she would eventually inherit the farm.

At the Court of Appeal in London, Lord Justice Floyd noted that when she returned to live in the farmhouse at the end of 2007, she was told that it “would be her home, rent free, for life.

Later, discussions took place regarding the possibility of granting her 49 per cent of the shares in the business, although no agreement was reached.

When her parents began legal proceedings to have her evicted, the woman claimed that she was entitled to a share in the property based on the legal principle of ‘proprietary estoppel’. This grants certain rights to property if a person has been given clear assurance that will acquire these and act on them ‘to their detriment’ – i.e. in such a way that they lose out on other opportunities.

A judge found that she had indeed acquired an interest in the farm, having acted on the various statements by her parents. She had at one point given up a job outside the farm to return and work there. As a result, it would be “unconscionable for her to be denied a full beneficial interest in the farm and a share of the farming business.”

Her parents appealed the ruling, arguing that their daughter had not suffered sufficient detriment to justify a share in the business. These arguments were rejected by the Court of Appeal.

Lord Justice Floyd said:

“The [original] judge had to determine whether there was substantial detriment by contrasting the rewards of the job [outside the farm] with its better lifestyle with those of working on the farm (including the free accommodation…) with its greater burdens in terms of working hours and more difficult working relationships. I am not at all persuaded that his conclusion as to where the scales came down in this balancing exercise was wrong.

The judge’s conclusion that there was net detriment [the woman] was one to which he was entitled to come.  It was the result of a classic evaluative exercise which he performed with care. The evaluation is not flawed in a way which would justify this court in interfering.”

However, he did allow one aspect of the parents’ appeal – namely that the daughter was not entitled to an immediate interest in the farming business. The extent of her interest was to be determined at a subsequent hearing.

Lord Justice Floyd concluded:

“This is in many ways a tragic case.  As the judge observed, the bitterness between the parties was such that each had few, if any, good words to say about the other.  The fact remained, however, that between them they had over the years built up “by hard work, great skill and passionate dedication a prodigious Holstein pedigree milking herd and a highly successful business”. It is greatly to be hoped that they might now be able to resolve such remaining differences as they have in relation to [the daughter’s] entitlement without recourse to further costly and divisive litigation.”

To read the full judgement, please click here.

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