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Home > Judgments

Moore v Moore & Anor [2018] EWCA Civ 2669

Appeal in long-running case concerning a claim for proprietary estoppel involving a family farm. Appeal allowed on the ground of how the equity was to be satisfied.

The case concerned two generations of the Moore family and was described as ruinous in human and financial terms. Roger Moore had worked and farmed Manor Farm together with his brother since 1966. Roger Moore was married to Pamela and they had two children: Julie and Stephen. Stephen worked on the farm for most of his life, becoming a salaried partner in 1998 and an equity partner in 2003. In 2008, Till Valley Contracting Limited was incorporated to manage the farm's finances tax efficiently. The shares were held as to 51% by Roger and as to 49% by Stephen.

In 2012, Roger purported to dissolve the partnership. The validity of the notice was disputed by Stephen and this precipitated the litigation. Roger applied for a declaration that the notice was valid and an order that the partnership be wound up. Stephen defended this claim and counter-claimed in proprietary estoppel seeking that he would inherit Roger's interest in the farm, subject only to adequate provision being made for Pamela for the remainder of her life.

At first instance, Simon Monty QC sitting as a Deputy High Court Judge, ruled in favour of Stephen's claim, finding that there had been a promise by Roger which Stephen had taken to mean that he would inherit Roger's interest in the farm and had relied to his detriment on this promise by virtue of his life's work on the farm. Having found the claim in proprietary estoppel, the Judge declared that Stephen had an equity over the entirety of Roger's interest in the farm, including his interest under the partnership and the farm assets.

It was this reasoning, concerning how the equity was to be satisfied, which was ultimately the successful one of the thirteen grounds of appeal pleaded by Roger. By the time of the appeal, Roger was represented by his wife and litigation friend, Pamela, as he lacked capacity to conduct legal proceedings.

The thirteen grounds of appeal pleaded by Roger are set out at paragraphs 42 to 47. The ground which was ultimately successful concerned the satisfaction of the equity and the reasoning of Lord Justice Henderson is set out at paragraphs 89 to 108. In short, Henderson LJ allowed the appeal because the first instance judge had wrongly exercised his discretion to satisfy the equity on Stephen's claim. The Court of Appeal highlighted, at paragraph 25, the division in the case-law as to how to satisfy an equity which had been established; whether first, to give effect to the claimant's expectation, or second, to ensure the claimant's reliance interest is protected and is compensated for such detriment as has been suffered.

The first instance judge mirrored as closely as possible the arrangements which would have obtained had the litigation not arisen. On the facts, this resulted in the farm being transferred to Stephen with Pamela being allowed to remain in the farmhouse with an allowance of £200 per week.

Lord Justice Henderson held this exercise of the discretion to be wrong and reluctantly remitted the case for trial on the issue of satisfying the equity. In remitting the case however, Henderson LJ gave guidance on the issue of equity, commenting that a lump sum of £1 million to £2 million would meet Pamela's housing needs and would give effect to the finding that Stephen should inherit his father's share of the farm and the business while making reasonable provision for Pamela.

Summary by Patrick Paisley, barrister, 1GC Family Law

____________________

Case No: A3/2016/3565
Neutral Citation Number: [2018] EWCA Civ 2669

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE CHANCERY DIVISION (BRISTOL DISTRICT REGISTRY)
MR SIMON MONTY QC sitting as a Deputy High Court Judge)

Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 27/11/2018

Before:

LORD JUSTICE FLOYD
LORD JUSTICE HENDERSON

and
LORD JUSTICE LEGGATT

- - - - - - - - - - - - - - - - - - - - -

Between:
ROGER MOORE
(BY HIS LITIGATION FRIEND PAMELA MOORE)
Appellant

- and -

(1)   STEPHEN MOORE
(2) TILL VALLEY CONTRACTING LTD
Respondents

- - - - - - - - - - - - - - - - - - - - -

Mr Christopher Pymont QC & Mr Nigel Thomas (instructed by Thrings LLP) for the Appellant
Ms Caroline Shea QC & Ms Ciara Fairley (instructed by Michelmores LLP) for the Respondents

Hearing dates: 9 and 10 October 2018

- - - - - - - - - - - - - - - - - - - - -

Judgment

Lord Justice Henderson :

Introduction and background

1. This is a case about proprietary estoppel. As so often, it involves a family farm, and a sad breakdown in relations between members of the family. Indeed the dispute has already been ruinous in both human and financial terms. We were told that the total costs so far incurred on both sides are estimated to be in the region of £2.5 million.

2. The case comes to us on appeal by the original claimant and Part 20 defendant, Mr Roger Moore ("Roger"), from the order made on 19 August 2016 by Mr Simon Monty QC, sitting as a deputy High Court Judge of the Chancery Division, following a nine-day trial in Bristol between 5 and 18 July 2016. Roger was unable to participate in the trial, because he was already suffering from moderately severe Alzheimer's disease and lacked capacity to conduct legal proceedings. He was represented by his wife and litigation friend, Mrs Pamela Moore ("Pamela"). Sadly, Roger's condition has continued to deteriorate over the last two years. He now lives in a care home, where he needs permanent care and (as matters stand) will remain for the rest of his life. He is now 76 years old, having been born on 30 March 1942, and Pamela is approximately the same age.

3. Roger and Pamela married in 1965, when they were both in their early twenties. Roger was the eldest of the three sons of John Moore, who was himself the second generation of the Moore family to own and farm Manor Farm in Stapleford, near Salisbury in Wiltshire. Roger's two brothers were Geoffrey (who plays an important role in the history of the present case) and Richard. Pamela, however, did not come from a farming background. She was born in London and moved to Salisbury at the age of 18 in 1960 to study at a teacher training college. She soon met Roger, and they started dating. Their relationship flourished, and they married, as I have said, in 1965, by when Pamela had qualified and was teaching music and history at Wilton Secondary Modern School.

4. In 1966, John Moore gave the farm to Roger and Geoffrey, who began to farm it together in partnership. John also gave some other land to Richard, who was not interested in pursuing a farming career. In 1981, Roger and Geoffrey bought this land back from Richard.

5. Roger and Pamela have two children, a daughter Julie, who was born in 1965, and a son Stephen, born in 1967. Julie is married to Andrew Lane, and they have two children, Victoria and Sam. Stephen is married to Jackie, and they have two daughters. Stephen is the original defendant and Part 20 claimant. It is Stephen's claim in relation to his father's half share of Manor Farm and the partnership business, raised for the first time in a defence and counterclaim to partnership proceedings instituted by Roger, which lies at the heart of the present dispute.

6. Manor Farm extends to some 650 acres of mainly arable land (although it has in the past supported a dairy herd). As the judge recorded, there are several houses on the farm. Manor Farmhouse itself is a substantial property, where Roger and Pamela have lived since their marriage, and where Stephen and Julie grew up. The Little House is a bungalow occupied by Stephen, Jackie and their children. Ashburton is a smaller thatched house adjoining Manor Farmhouse, "on which" in the judge's words "substantial sums were expended in anticipation of it becoming Roger and Pamela's residence in due course."

7. It is common ground that the farm was a thriving and profitable business during the period of over 40 years when Roger and Geoffrey were both partners, until Geoffrey's retirement in April 2008. Over the years, both before and after the death of John Moore in 1980, Roger and Geoffrey bought further parcels of land to expand the farming operations, including the land which they bought back from Richard in 1981. According to the judge:

"Both Geoffrey and Roger took modest drawings and most of the profit went back into the business. Roger, who took the lead in most farming issues, was by all accounts an excellent farmer and Geoffrey was a great support to him."

8. Stephen has worked on the farm since his childhood, initially at weekends, evenings and in school and then college holidays, and subsequently full time. He became a salaried partner in around 1998, by when he had been earning £200 per week for a 45 to 50-hour week (rising to 100 hours per week at harvest time). As a salaried partner, Stephen earned £590 per fortnight, from which he paid £190 per month as a pension contribution. The judge found those earnings to be "more or less in line with the drawings taken by Roger and Geoffrey". Then in 2003/4 Stephen became an equity partner, sharing in the profits with his father and uncle.

9. Geoffrey had two sons of his own, James and William, but neither of them worked on the farm except occasionally at harvest time. When Geoffrey came to retire from the farming business in April 2008, thereby bringing the existing partnership to an end, he decided to give his half share of the partnership to Stephen, his nephew, in return for a payment from the partnership of £500,000 which was satisfied in two instalments. The judge found that Geoffrey's interest in the partnership was worth approximately £3 million, so this represented a very substantial benefaction by Geoffrey to Stephen, at the apparent expense of his own sons (who, like Richard before them, did not wish to become farmers).

10. The judge found that Geoffrey's decision "came as a surprise to Roger, Pamela and Stephen". It was agreed by Geoffrey, Roger and Stephen that Roger and Stephen would continue to farm in partnership together. This they did, although for tax reasons, and on advice from the partnership's accountant, Mr Mike Butler, a company, Till Valley Contracting Limited ("the Company"), was established in 2008 and also became a partner. The shares in the Company are held as to 51% by Roger and as to 49% by Stephen. Its main purpose was to provide a receptacle for some of the substantial profits of the business, which would otherwise have been liable to tax at higher marginal rates in the hands of Roger and Stephen. In addition, various farming assets were transferred into the Company in 2010, and were paid for by means of directors' loans, with the intention that those loans would over time be paid down from the profits from the Company. The directors were Roger and Stephen, and as the judge found the Company "had no function or directing mind independent from" them. Although the Company derived a small amount of income from contracting operations, its main source of revenue was its allocated share of partnership profits, the amount of which would be determined from year to year on advice from Mr Butler.

11. The judge found that relations between Pamela and Stephen had been difficult since Stephen's childhood, and that Pamela was "critical both of Stephen's behaviour and his academic performance". There is nothing, however, to indicate that this tension caused any practical difficulties before Geoffrey's retirement. The serious breakdown in relations within the family seems to have begun in 2009, which the judge described as "a key year" which "marked a serious breakdown in relations between Stephen and Jackie on the one hand and Pamela, Roger, Julie and Andrew on the other."

12. As the judge explained:

"109. Roger was finding it hard to adjust to his reduced role on the Farm. Stephen was noticing problems with his father's memory and reliability and consequently he gave him fewer tasks to do on the Farm, which Roger could not accept (he commented to Pamela, "I might as well shoot myself") and which Pamela blames Stephen for, because she would not accept that Roger was less capable than before. Pamela could simply not accept Stephen as head of the business.

110. It also marked a period when Pamela started to keep Roger away from Stephen. This coincided with a growing feeling, on Pamela's part, that what I have described as the over-arching plan for the Farm's future was unfair on Julie and benefitted only Stephen, with whom she was becoming increasingly disenchanted."

13. The "over-arching plan" to which the judge referred was central to his analysis of the evidence which he heard and evaluated about the family's plans for the future of the farming business following Roger's death or retirement. The judge described this plan as follows, at [63]:

"It seems to me that everything points to an over-arching plan under which Stephen would inherit the whole farm and business in due course, and that Stephen was told that this was the case by both Roger and Geoffrey. I think that Pamela is wrong to characterise that as a mere hope – in my view, on the evidence, it was more than that. It was a clear understanding and intention which Stephen was told about on many occasions. It underpinned all the decisions made in relation to the Farm, and in particular the basis on which Geoffrey retired."

14. As the judge found, this over-arching plan was consistent with the evidence of Mr Butler, and also with Pamela's acceptance in cross-examination that Geoffrey's decision represented "the next stage in Stephen's succession to taking over the entirety of the business", and that this was her understanding and the way she saw it in 2008: see the judgment at [62]. Furthermore, this was also what Geoffrey unambiguously intended. As the judge said, at [65]:

"Geoffrey was also completely clear in his evidence; "Fundamentally, had I ever believed in 2007/8 that Roger was not going to pass his interest in the Farm and the business to Stephen, then I would not have retired on the terms that I did." In my judgment, Geoffrey's evidence is of fundamental importance in showing what Roger's real intentions were. The decisions taken by Geoffrey in connection with his retirement are only consistent with a belief, shared by him, his wife Liz, Roger and Pamela that Stephen was to inherit the Farm. In my view, on Stephen's evidence, that was a belief and indeed an intention which was expressed to Stephen."

15. It is unnecessary, at this introductory stage, to trace the steps in the breakdown of family relations which began in 2009. It is enough to say that by a notice of dissolution dated 21 December 2012 Roger purported to dissolve the partnership with immediate effect pursuant to section 32(c) of the Partnership Act 1890, on the footing that it was a partnership at will. The validity of the notice was disputed by Stephen, who contended that the partnership was for the joint lives of Roger and Stephen (or, if Roger were to predecease Pamela, until the subsequent death of Pamela). Eventually, the present action was begun by a claim form issued on 7 February 2013, whereby Roger sought a declaration that the partnership had been dissolved by the notice of 21 December 2012 and an order that the partnership be wound up. In March 2013, Stephen served his defence and counterclaim, in which he pleaded that from his childhood, and for as long as he could remember, it had been "envisaged and promised" by Roger that he "would inherit" Roger's interest in the farm, "subject only to adequate provision being made for Pamela (in the event she should outlive the Claimant) for the remainder of her life": see paragraph 10 of the defence.

16. The promises upon which Stephen relied were set out in his Part 20 counterclaim. He said Roger had told him from an early age that the farm and the farming assets of the farming partnership "would be his one day". The promises were all made orally, and Stephen could not remember the first occasion, nor all of the occasions, on which they were made. Nevertheless, they "were made and repeated on more than a dozen occasions, without warning or fanfare", and Stephen referred to three specific occasions when he remembered the promises being repeated. The first such occasion was in the early 1990's, when Stephen went to work on the farm full time after completing three years at agricultural college. The second occasion was in or around 2002, when a large farming contract involving some 800 acres of land was undertaken by the partnership. The third occasion was in 2007/8, around the time Geoffrey's retirement plans were being formulated.

17. According to paragraph 25 of the counterclaim:

"[Stephen] reasonably understood the promises, and the aforesaid conduct, to mean that [Roger] intended that [Stephen] would in the fullness of time take over [Roger's] role in the farming enterprise on the Farm, and that upon the later of [Roger's] or Pamela's death [Stephen] would inherit [Roger's] interest in the Farm (including for the avoidance of doubt [Roger's] interest under the Partnership) and the Farm Assets, to be the fourth generation custodian of the Farm by the Moore family."

I pause to emphasise the important point that Stephen understood the promises to mean that he would inherit Roger's interest in the farm and the farming business upon the death of the survivor of Roger and Pamela. It was also expressly accepted by Stephen (see paragraph 10 of his defence, quoted above) that his claim was subject to adequate provision being made for Pamela for the remainder of her life, should she outlive Roger.

18. Stephen went on to plead that, in reliance on these promises, he had acted to his detriment. The particulars of alleged detriment set out in paragraph 26 of the counterclaim include the following:

a) Stephen committed himself completely to the best interests of the farm and the partnership between Roger and Geoffrey since he was a child, without regard to his own position and that of his wife and two daughters;

b) he took no steps to explore or create any career opportunities other than farming;

c) he took no steps to further his career in farming otherwise than at the farm;

d) he worked for rates of pay below what he could have earned doing similar work on an employed basis, including working for no wages during evenings and weekends and for nominal pocket money during school or college holidays, working on average 65 hours per week from 1991 to about 2001 for £200 per week until he became a salaried partner, and continuing the same level of work after he became a salaried partner for £590 per fortnight, which was well below market rates for someone of Stephen's skill, qualifications and level of responsibility, and well below what it would have cost to pay a skilled manager running such an operation; and

e) he took no steps, and was not paid enough to enable him, to secure a house in his own name, or to build up any other assets, savings or security. The Little House remained throughout in the joint ownership of Roger and Geoffrey.

19. After a full consideration and review of all the evidence which he had heard (including some aspects of it to which I will need to return), the judge made his key findings in relation to the alleged promises at [145] to [147]:

"145. For the reasons I have set out above, I accept that Stephen is right when he says that he was promised the Farm and the business. I take into account Mr Thomas's submission that the promises were said to have beeen witnessed only by Stephen and Jackie and that only Stephen can remember specific occasions but I do not accept his submission that Stephen's evidence was highly unconvincing. On the contrary, I thought that Stephen's evidence was reliable, as was Jackie's, and I accept it. Mr Thomas said that the evidence was that Roger was a private man who would not have discussed these matters with others, but again there is clear evidence in my view that in fact he did. I also accept that the point was made in Thorner v Major at [3] that intentions were of no importance, and that the question is whether by words and acts it would reasonably have been conveyed to Stephen an assurance that he would inherit. In my judgment, Stephen has established that on the facts. The promises were more than mere assumptions about what might happen. It strikes me as inconceivable that Stephen was not made the promises when it had been plain for years that he was being groomed to take over the farming business as part of Geoffrey and Roger's over-arching plan.

146. It was suggested by Mr Thomas that at best the statements made were in some sense conditional on Stephen's behaviour. For example, in Uglow v Uglow [2004] EWCA Civ 987 the Court of Appeal upheld the trial judge's finding that the promise was really that the claimant would inherit "if all went well with the business relationship" [20(1)]. The fact is that in the present case the Farm business went from strength to strength, and in my judgment the allegations of bad behaviour made against Stephen are so trivial as to be of no effect.

147. I also take into account Cooke v Thomas [2010] EWCA Civ 227 where the trial judge accepted that the words, "you know this is all going to be yours when I am gone anyway" were held not to be a promise but an indication of intention [72]. Again, it seems to me that whether or not words actually used amounted to a mere indication of intention or were a promise is entirely a factual issue, and in the present case I have no hesitation of resolving that issue in Stephen's favour."

20. The judge went on to decide the overlapping issues of reliance and detriment in Stephen's favour too. In relation to reliance, he said this at [148]:

"I also accept that Stephen relied on the promises by basing his life on the Farm, and by working on the Farm, without any consideration of any alternative employment, because he truly believed, as he had been encouraged to believe, that in the fullness of time he would inherit the Farm and the business. I accept that Stephen is right when he says that he would not have worked as he did for only modest payments nor would he have carried on living in a bungalow, but in my judgment it is entirely idle speculation to ask what Stephen would have done had he not been made those promises. The fact is that promises were made, and in reliance on them he devoted his entire working life to the Farm and the business. As did the Applicant in Suggitt v Suggitt [2012] EWCA Civ 1140, Stephen positioned his whole life on the basis of the assurances given to him and which were reasonably believed by him. Stephen's whole-hearted commitment to the Farm and the business precluded him from pursuing any alternatives."

21. In relation to detriment, the judge summarised Stephen's oral evidence at [149], and recorded that none of it had been challenged. The judge concluded, at [150], that "Stephen did suffer detriment in reliance on the promises". He then considered, and rejected, arguments advanced by Mr Thomas for Roger that there was no detriment because (a) Stephen had been very well paid as a partner, and (b) he had inherited Geoffrey's share in the farm. In relation to the first argument, the judge considered a schedule attached to Mr Thomas's skeleton argument which set out the monetary benefits which Stephen had allegedly received. Some of the figures in this schedule might have been derived from the partnership accounts, but others were not, and they were not introduced in evidence, nor had the schedule and the supposed benefits been put to Stephen in cross-examination, or explored in any way with Mr Butler, on whose evidence the figures appeared at least in part to be based: see [152]. The judge's conclusion, at [160], was that he could "take no account of the matters in the schedule."

22. In relation to Mr Thomas's second argument on detriment, the judge's conclusion was forthright:

"161. As to Mr Thomas's second point, in my judgment Stephen's acquisition of Geoffrey's share is wholly irrelevant to the question of detriment. It is right that in one sense the share derived from his work on the Farm and the over-arching plan or intention that he would inherit the whole of the Farm one day, but it was not given to Stephen in satisfaction of the equity arising from Roger's promises to Stephen in relation to Roger's own share of the partnership, and in any event it post-dated the detrimental reliance. Further, the partnership actually paid £500,000 for Geoffrey's share, some of which was accounted for by a reduction in Stephen's partnership account, a price which on Geoffrey's evidence was set because of the promise – as well as the over-arching intention - that Stephen would have Roger's share."

23. For similar reasons, the judge then rejected the argument that it would not be unconscionable if Stephen were not to receive Roger's share: see the judgment at [162] to [166]. The only further point I need to note is at [166], where the judge said:

"Mr Thomas also says that I should take into account the competing moral and legal claims on Roger's estate, namely those of Julie and Pamela. This it seems can and should be taken into account not when considering unconscionability, but rather when considering the question of how should the equity be satisfied."

Principles of law

24. Before I come on to the judge's decision as to how the equity should be satisfied, it is convenient to refer to some of the legal principles which are agreed to apply in proprietary estoppel cases. The judge, at [16], guided himself by reference to the principles set out by Lewison LJ (with whom Underhill and Patten LJJ agreed) in Davies v Davies [2016] EWCA Civ 463, [2016] P. & C. R. 10, at [38]. Both sides confirmed to us that they accepted these propositions, which Lewison LJ stated as follows:

"(i) Deciding whether an equity has been raised and, if so, how to satisfy it is a retrospective exercise looking backwards from the moment when the promise falls due to be performed and asking whether, in the circumstances which have actually happened, it would be unconscionable for a promise not to be kept either wholly or in part: Thorner v Major [2009] UKHL 18; [2009] 1 WLR 776 at [57] and [101].

(ii) The ingredients necessary to raise an equity are (a) an assurance of sufficient clarity (b) reliance by the claimant on that assurance and (c) detriment to the claimant in consequence of his reasonable reliance; Thorner v Major at [29].

(iii) However, no claim based on proprietary estoppel can be divided into watertight compartments. The quality of the relevant assurances may influence the issue of reliance; reliance and detriment are often intertwined, and whether there is a distinct need for a "mutual understanding" may depend on how the other elements are formulated and understood: Gillett v Holt [2001] Ch. 210 at 225; Henry v Henry [2010] UKPC 3; [2010] 1 All ER 988 at [37].

(iv) Detriment need not consist of the expenditure of money or other quantifiable financial detriment, so long as it is something substantial. The requirement must be approached as part of a broad inquiry as to whether repudiation of an assurance is or is not unconscionable in all the circumstances: Gillett v Holt at 232; Henry v Henry at [38].

(v) There must be a sufficient causal link between the assurance relied on and the detriment asserted. The issue of detriment must be judged at the moment when the person who has given the assurance seeks to go back on it. The question is whether (and if so to what extent) it would be unjust or inequitable to allow the person who has given the assurance to go back on it. The essential test is that of unconscionability: Gillett v Holt at 232.

(vi) Thus the essence of the doctrine of proprietary estoppel is to do what is necessary to avoid an unconscionable result: Jennings v Rice [2002] EWCA Civ 159; [2003] 1 P. & C. R. 8 at [56].

(vii) In deciding how to satisfy any equity the court must weigh the detriment suffered by the claimant in reliance on the defendant's assurances against any countervailing benefits he enjoyed in consequence of that reliance: Henry v Henry at [51] and [53].

(viii) Proportionality lies at the heart of the doctrine of proprietary estoppel and permeates its every application: Henry v Henry at [65]. In particular there must be a proportionality between the remedy and the detriment which is its purpose to avoid: Jennings v Rice at [28] (citing from earlier cases) and [56]. This does not mean that the court should abandon expectations and seek only to compensate detrimental reliance, but if the expectation is disproportionate to the detriment, the court should satisfy the equity in a more limited way: Jennings v Rice at [50] and [51].

(ix) In deciding how to satisfy the equity the court has to exercise a broad judgmental discretion: Jennings v Rice at [51]. However the discretion is not unfettered. It must be exercised on a principled basis, and does not entail what HH Judge Weekes QC memorably called a "portable palm tree": Taylor v Dickens [1998] 1 F. L. R. 806 (a decision criticised for other reasons in Gillett v Holt)."

25. Lewison LJ then referred, at [39], to what he called "a lively controversy about the essential aim of the exercise of this broad judgmental discretion". As he explained:

"One line of authority takes the view that the essential aim of the discretion is to give effect to the claimant's expectation unless it would be disproportionate to do so. The other takes the view that [the] essential aim of the discretion is to ensure that the claimant's reliance interest is protected, so that she is compensated for such detriment as she has suffered. The two approaches, in their starkest form, are fundamentally different: see Cobbe v Yeoman's Row Management Limited [2006] EWCA Civ 1139; [2006] 1 WLR 2964 at [120] (reversed on a different point [2008] UKHL 55; [2008] 1 WLR 1752). Much scholarly opinion favours the second approach… Others argue that the outcome will reflect both the expectation and the reliance interest and that it will normally be somewhere between the two… Logically, there is much to be said for the second approach. Since the essence of proprietary estoppel is the combination of expectation and detriment, if either is absent the claim must fail. If, therefore, the detriment can be fairly quantified and a claimant receives full compensation for that detriment, that compensation, ought, in principle, to remove the foundation of the claim… Fortunately, I do not think that we are required to resolve this controversy on this appeal."

26. Although this controversy was briefly referred to by leading counsel on both sides in their oral submissions, and Mr Pymont QC (appearing for Roger in this court, although he did not appear below) suggested that it might be necessary for us to resolve it, I do not see it as central to the resolution of the present case, and (if it were) much fuller argument on the law than we actually received would have been necessary. I will therefore content myself with saying that, although the second approach is logically attractive, I would be wary of according it primacy in a field where cases are so fact sensitive and proportionality has such a prominent role to play. As Robert Walker LJ said in Jennings v Rice at [44]:

"The need to search for the right principles cannot be avoided. But it is unlikely to be a short or simple search, because (as appears from both the English and the Australian authorities) proprietary estoppel can apply in a wide variety of factual situations, and any summary formula is likely to prove to be an over-simplification."

27. Robert Walker LJ went on in Jennings v Rice to distinguish between some of the broad types of case which tend to arise in this area of the law. In some cases, "the assurances, and the claimant's reliance on them, have a consensual character falling not far short of an enforceable contract": see [45]. In cases of that kind, "both the claimant's expectation and the element of detriment to the claimant will have been defined with reasonable clarity", for example where an elderly benefactor reaches a clear understanding with the claimant that if the claimant resides with and cares for the benefactor, the claimant will inherit the benefactor's house or will have a home for life. In such cases, "the consensual element of what has happened suggests that the claimant and the benefactor probably regarded the expected benefit and the accepted detriment as being (in a general, imprecise way) equivalent, or at any rate not obviously disproportionate", and other things being equal it will often be appropriate to provide the claimant with the specific property which the benefactor has promised (ibid).

28. On the other hand, there will be cases where the claimant's expectations are uncertain, or where the high level of the claimant's expectations is incommensurate with the assurances which have been given. In such cases, the claimant's expectations may still be taken as a starting point, but no more: see [47]. Such an approach accords with Scarman LJ's reference to "the minimum equity to do justice to the plaintiff" in Crabb v Arun District Council [1976] Ch. 179, 198, and with nineteenth-century cases such as Plimmer v Wellington Corporation (1884) 9 App. Cas. 699, where Sir Arthur Hobhouse said at 714:

"In fact the court must look at the circumstances in each case to decide in what way the equity can be satisfied."

Robert Walker LJ added, at the end of [48]:

"Scarman LJ's reference to the minimum does not require the court to be constitutionally parsimonious, but it does implicitly recognise that the court must also do justice to the defendant."

29. Robert Walker LJ continued, in an important passage on which Mr Pymont QC placed particular reliance and which I need to set out at some length:

"49. It is no coincidence that these statements of principle refer to satisfying the equity (rather than satisfying, or vindicating, the claimant's expectations). The equity arises not from the claimant's expectations alone, but from the combination of expectations, detrimental reliance, and the unconscionableness of allowing the benefactor (or the deceased benefactor's estate) to go back on the assurances.

50. To recapitulate: there is a category of case in which the benefactor and the claimant have reached a mutual understanding which is in reasonably clear terms but does not amount to a contract. I have already referred to the typical case of a carer who has the expectation of coming into the benefactor's house, either outright or for life. In such a case the court's natural response it to fulfil the claimant's expectations. But if the claimant's expectations are uncertain, or extravagant, or out of all proportion to the detriment which the claimant has suffered, the court can and should recognise that the claimant's equity should be satisfied in another (and generally more limited) way.

51. But that does not mean that the court should in such a case abandon expectations completely, and look to the detriment suffered by the claimant as defining the appropriate measure of relief. Indeed in many cases the detriment may be even more difficult to quantify, in financial terms, than the claimant's expectations...Moreover the claimant may not be motivated solely by reliance on the benefactor's assurances, and may receive some countervailing benefits (such as free bed and board). In such circumstances the court has to exercise a wide judgmental discretion.

52. It would be unwise to attempt any comprehensive enumeration of the factors relevant to the exercise of the court's discretion, or to suggest any hierarchy of factors. In my view they include, but are not limited to… misconduct of the claimant… or particularly oppressive conduct on the part of the defendant… To these can safely be added the court's recognition that it cannot compel people who have fallen out to live peaceably together, so that there may be a need for a clean break; alterations in the benefactor's assets and circumstances, especially where the benefactor's assurances have been given, and the claimant's detriment has been suffered, over a long period of years; the likely effect of taxation; and (to a limited degree) the other claims (legal or moral) on the benefactor or his or her estate. No doubt there are many other factors which it may be right for the court to take into account in particular factual situations."

30. Ms Shea QC submitted on behalf of Stephen that the present case is a good example of Robert Walker LJ's first category, where the circumstances fall not far short of an enforceable contract. She also submitted that the guidance given by Robert Walker LJ at [52] had no application to cases of that type. I am, however, unable to accept either submission, at least in the unqualified form in which it was advanced. As I shall explain, although the present case does have some features of the first category type of case, there are also important differences, not least the fact that Roger's assurances were only intended to take effect on the death of the survivor of himself and Pamela, whereas the partnership came to an end, and the relationship between the parties broke down, while they were both still alive. Secondly, I would read Robert Walker LJ's guidance in Jennings v Rice at [52] as intended to be of general application, albeit less likely to have a significant influence in cases which clearly fall into the first category.

31. After this short excursus into the law, I can now return to the judge's decision on how the equity should be satisfied.

The judge's decision on how the equity should be satisfied

32. The judge's starting point (at [168]) was his finding of fact that Stephen had proved his pleaded case in relation to the promises. Accordingly, Stephen's equity extended to Roger's interest in the farm, the partnership, and the farm assets (including the farming assets of the Company): see [169]. The judge then gave his reasons, at [171], for finding that Roger's interest in the partnership extended to Roger's current account, his share of the Company's cash and profits, and his director's loan account. As I shall explain, these findings are challenged in some of the subsidiary grounds of appeal.

33. At [174], the judge directed himself that:

"… the equitable doctrine should be as flexible as the circumstances allow in order to give effect to the equity; the aim is to look at all the circumstances to decide in what way the equity can be satisfied; the approach is a cautious one, in order to achieve the minimum equity required to do justice; there is a wide range of possible relief; and it [is] not necessarily a question of providing compensation for either the detriment or the reliance or the expectation. It may be necessary to exercise a wide judgmental discretion. Proportionality lies at the heart of the doctrine of promissory estoppel; the court must take into account whether in all the circumstances the promise and the benefit is proportionate to the detriment and the remedy must also be proportionate."

In the light of the legal principles which I have reviewed, it appears to me that this self-direction was firmly based on the authorities (nineteen of which the judge said had been cited to him), and Mr Pymont rightly did not seek to criticise it.

34. The judge then stated his conclusions quite shortly, as follows:

"175. Miss Shea submitted that I should exercise my discretion, when deciding how the equity should be satisfied, by mirroring as closely as possible the arrangements which would have obtained had the dispute not arisen. I agree.

176. The effect of this is that both Pamela and Roger should continue to receive what they were intending and expecting to receive, up until their deaths. Stephen will take over the farming for all practical purposes; but the assets of the enterprise which will now be in his name alone will be fixed with the obligation to pay the agreed sums out to support Roger and Pamela going forwards.

177. Roger and Pamela should remain at Manor Farmhouse for as long as that meets their needs, with Stephen responsible for maintaining and repairing it, with the potential to move to Ashburton (on the same terms namely a licence for their lives jointly or severally) should Roger no longer require to reside at Manor Farmhouse and subject to Geoffrey's agreement. Roger and Pamela would continue to receive a weekly sum of £200. Stephen should be required to pay from Partnership funds for all reasonable health and care costs for Roger (and Pamela should the need arise), and Stephen has indicated that he is willing to do this. Subject to that, Roger's partnership share should be transferred to Stephen. Pamela is entitled to dispose of all the non-farm assets she and Roger have accumulated as she wishes.

178. This is, as Miss Shea observes, a just and equitable outcome. It honours what Roger always intended and reflects what would have transpired had the dispute not arisen. It means that the farm can continue to be farmed by the next generation of the Moore family, as in my judgment Roger always intended. It is also in my judgment proportionate to the detriment."

35. The trial concluded on 18 July 2016, when the judge reserved his judgment. He then produced his written judgment, which runs to 196 paragraphs, with commendable speed, and a further hearing on 19 August 2016 was fixed to deal with consequential matters. One issue which arose was whether three properties, namely the Little House, Ashburton and the Water Meadows, were subject to the equity which Stephen had established. The judge held that they were, for the reasons which he gave in a short ex tempore judgment on 19 August: see [2016] EWHC 2202 (Ch) ("the supplementary judgment"). These findings, too, are challenged in the grounds of appeal.

36. By his order dated 19 August 2016, but not sealed until 1 September 2016, the judge made the following declarations:

a) The partnership between Roger, Stephen and the Company was a partnership for the joint lives of Roger and Stephen;

b) the partnership was liable to be dissolved on 31 August 2016 and its affairs wound up;

c) the Little House, Ashburton, and the Water Meadows were assets of the partnership; and

d) Stephen had an equity, by reason of proprietary estoppel, over the entirety of Roger's interest in the farm, including his interest under the partnership (defined as "the Claimant's Partnership Interest") and the Farm Assets, which for the avoidance of doubt were stated to include Roger's interest in specified freehold properties, his current and capital partnership accounts, and his interest in the Company, comprising cash, assets and director's loan account (together defined as "the Claimant's Company Interest").

37. The operative part of the order then required Stephen to procure the preparation of dissolution accounts of the partnership by Mr Butler's firm (Old Mill), and directed Roger and Stephen to "use all reasonable endeavours to cooperate" in procuring those accounts and winding up the partnership, with liberty to apply in the event of any disagreement.

38. The order then provided as follows:

"4. [Roger] do forthwith (and in any event by 5pm on 16 September 2016) transfer the Claimant's Partnership Interest to [Stephen], including (for the avoidance of doubt) effecting the necessary transfers of the Claimant's Freehold Property and the Claimant's Company Interest and take all steps necessary to complete such transfers;

5. [Stephen] do grant to [Roger] and his wife, Pamela Moore, a licence ("the Licence") to reside in Manor Farmhouse ("Manor Farmhouse"), the extent of which for the purpose of the Licence is delineated in red on the plan attached hereto ("the Plan") on the following terms

(1) [Roger] and his wife will be entitled to exclusive occupation of Manor Farmhouse;

(2) No other persons will be entitled to occupy Manor Farmhouse, save for

(i)  family and friends of [Roger] and his wife on an occasional    basis;

ii) care or health workers who may be required to stay overnight for the purposes of caring for [Roger] or his wife;

(3) No monies will be payable by [Roger] or his wife in respect of the occupation pursuant to the licence;

(4) [Stephen] will be responsible for all outgoings relating to Manor Farmhouse, in respect of Council Tax, water rates, central heating oil and all insurance made in respect of its occupation together with electricity and telephone/internet charges during their occupation of Manor Farmhouse.

(5) [Stephen] will keep Manor Farmhouse in good repair and condition, such liability to arise upon being given reasonable notice of any want of repair or condition.

(6) The Licence will endure until [Roger] and/or his wife no longer desires, or is/are no longer capable of living in the Farmhouse, upon which [Stephen] will, if so requested by [Roger] and/or his wife, grant a licence on the same terms mutatis mutandis to[Roger] and/or his wife of Ashburton, (the extent of which for the purpose of the said licence is delineated in blue on the Plan), and will use reasonable endeavours to secure the agreement and cooperation of Geoffrey Moore, or any other person who is at the relevant time co-owner of Ashburton, to the grant of such a licence;

(7) [Roger] and/or his wife and/or [Stephen] do have liberty to apply to the Court if the cooperation and agreement of Geoffrey Moore and/or other co-owner of Ashburton cannot be secured;

(8) The said licence, whether of Manor Farmhouse or Ashburton, is to endure for the lives of [Roger] and his wife, or until such time both of them no longer desire to, or are capable of, residing in Manor Farmhouse or Ashburton.

6. [Stephen] do pay to [Roger] and his wife the sum of £200 per week ("the weekly payments") for as long as either of them remains living.

7. If and whenever the health of either [Roger]or his wife requires nursing or health care to be provided, whether at the then home of [Roger] and/or his wife, or in the form of residential care, whether permanent or respite, [Stephen] will pay for the reasonable costs of such care.

8. The parties have liberty to apply to the Court for the purposes of enforcing these terms or should any unforeseen matter arise which prevents or hinders their implementation or operation".

39. In summary, therefore, the scheme established by the judge's order had the following key features:

a) the entirety of the property subject to Stephen's equity was to be transferred by Roger to Stephen within 28 days of the date the order was made;

b) Roger and Pamela were to be granted a licence to live in Manor Farmhouse for so long as they (or the survivor of them) wished or were capable of doing so, free of charge, and with Stephen assuming responsibility for payment of all outgoings (as specified) and for keeping the property in good repair and condition;

c) Roger and/or Pamela would have the option of moving to Ashburton if and when they chose to do so, in which case a licence of that property would be granted to them on the same terms, and with liberty to apply to the court if there were any difficulty in obtaining the cooperation and agreement of Geoffrey or the other co-owner for the time being of Ashburton;

d) Stephen should make weekly payments of £200 to his parents (or the survivor of them) during their lifetimes; and

e) Stephen would also be obliged to pay the reasonable costs of care for his parents, whether at home or in residential accommodation.

The parties were given liberty to apply by paragraph 8 of the order, but only for the purposes of enforcing the terms, or if any unforeseen matter should prevent or hinder their implementation or operation.

40. Roger was also ordered to pay the costs of the claim and the counterclaim, on the standard basis until 31 December 2015 and on an indemnity basis thereafter, together with interest on the costs at the judgment rate of 8% per annum, and to make a payment of £400,000 on account of those costs within 21 days.

Roger's appeal to this court

41. Roger now appeals to this court, with permission granted by me at an oral hearing on 7 December 2017 after permission to appeal had been refused both by the judge and by Patten LJ on the papers: see [2017] EWCA Civ 2345. I granted permission to appeal on all of the comprehensive grounds advanced, while emphasising that the judge's assessment of the witnesses and his primary findings of fact would be very difficult, if not impossible, to challenge, but the grounds of appeal relating to the way in which the equity was satisfied did in my view clearly cross the threshold for a first appeal. With some hesitation, I did not refuse permission to challenge the judge's findings of fact, because proprietary estoppel cases are so fact-sensitive, and the interlocking nature of the issues makes it particularly difficult to insulate a judge's findings of fact from the underlying questions of principle and the judge's approach to those questions. I therefore said that, if this court were to hear an appeal, it should be able to review the evidence in the round, as well as addressing the questions of principle which arise: see my judgment of 7 December 2017 at [18]. I also said that I would expect "a focused and discriminating approach to be adopted" on Roger's behalf to the challenges which he wished to pursue to the judge's findings of fact (ibid).

42. With those comments in mind, I turn to the numbered grounds of appeal. Ground 1 challenges the judge's key finding, at [145] of the judgment, that Roger had made the promises pleaded by Stephen. The challenge was made on various grounds, including alleged failure to consider and deal with the precise terms of the alleged promises, failure to give any or due consideration to the fact that this was a case of an alleged promise to leave property by will, an alleged consequential failure to consider whether the promises were properly to be characterised as mere statements of testamentary intention, and a direct challenge to the findings made by the judge in relation to wills made by Roger in 2007 and 2011.

43. Ground 2 focuses on the position of Pamela, and says (in short) that the judge failed to make proper allowance for Roger's obligations to her while she was alive, and to her matrimonial and inheritance rights engendered by a marriage of fifty years.

44. Ground 3 alleges that the judge "failed to give any account or credit" for the fact that Stephen's expectation was accelerated by the order, because he would now receive Roger's share of the farm and the partnership assets during the lifetimes of both his parents. Ground 4 says the judge was wrong to find that Stephen regarded the alleged promises as binding on Roger, when the weight of the oral and documentary evidence was that Stephen believed his father to be free to dispose of the farm. In this connection, particular reliance is placed on certain open correspondence from Stephen's solicitors, and from Stephen himself, in 2012 and early 2013, apparently accepting that Roger was free to assign his interest in the partnership and/or to seek a sale of the farm. The judge was wrong to construe this correspondence "as being written to avoid inflaming the situation" (ground 5).

45. Grounds 6 and 7 then challenge the judge's consequential findings of reliance and detriment, while grounds 8 to 10 raise issues in relation to the Company and its assets.

46. Ground 11 then attacks the judge's exercise of his discretion in deciding how to satisfy the equity, assuming it to have arisen. In particular, it is said that the judged erred: (a) in ordering an immediate transfer of the farm and the partnership assets, which went beyond anything Stephen had sought in his pleadings; (b) in granting relief which was "disproportionate and far greater than the minimum necessary to do justice"; (c) in depriving Roger and Pamela of all their assets, and thus of their ability to acquire a residence away from the farm; (d) in failing to give due consideration to Pamela's evidence in a witness statement dated 22 February 2016 (in connection with an application made to Newey J for a "Nugent" order permitting Roger's litigation costs to be raised from his partnership share) to the effect that Roger and Pamela had exhausted their non-partnership assets in the costs of the litigation; (e) in failing to give any or sufficient weight to the acceleration by the order of Stephen's equity; and (f) in leaving out of account Stephen's pleaded case that Roger's partnership share was to devolve upon Pamela for her life if she survived him.

47. Finally, ground 12 challenges the judge's finding that the partnership was one for joint lives, rather than a partnership at will; while ground 13 challenges the findings made in the supplementary judgment that Ashburton, the Little House and the Water Meadows were partnership property.

48. I propose to deal with the grounds of appeal in the following order. First, I will consider the challenges to the judge's findings of fact and to his conclusion that the equity pleaded by Stephen was established. Secondly, I will deal with Roger's challenge to the way in which the equity was satisfied by the judge's order. Thirdly, I will consider the subsidiary grounds relating to particular assets, the position of the Company and the duration of the partnership.

The grounds of appeal (1): issues of fact

49. Mr Pymont made it clear near the start of his oral submissions that he was maintaining Roger's challenge to the judge's conclusions at every level. Nevertheless, he wisely concentrated his submissions relating to the judge's findings of primary fact on his findings in two key areas: the wills made by Roger in 2007 and 2011, and the open correspondence from Stephen and his solicitors in 2012/13. Mr Pymont had well in mind the principles which govern the review of findings of fact by appellate courts, as laid down in a series of recent decisions of the Supreme Court and this court, beginning with McGraddie v McGraddie [2013] UKSC 58, [2013] 1 WLR 2477, and Henderson v Foxworth Investments Limited [2014] UKSC 41, [2014] 1 WLR 2600. The general rule is that an appellate court can interfere only where it is satisfied that the trial judge has gone "plainly wrong": see the judgment of Lord Reed JSC in Henderson at [62], where he added this clarification:

"The adverb "plainly" does not refer to the degree of confidence felt by the appellate court that it would not have reached the same conclusion as the trial judge. It does not matter, with whatever degree of certainty, that the appellate court considers that it would have reached a different conclusion. What matters is whether the decision under appeal is one that no reasonable judge could have reached."

50. Lord Reed then said, at [67]:

"It follows that, in the absence of some other identifiable error, such as (without attempting an exhaustive account) a material error of law, or the making of a critical finding of fact which has no basis in the evidence, or a demonstrable misunderstanding of relevant evidence, or a demonstrable failure to consider relevant evidence, an appellate court will interfere with the findings of fact made by a trial judge only if it satisfied that his decision cannot reasonably be explained or justified."

51. Equally pertinent and by now well known, although not cited to us, are the observations of Lewison LJ in the "Greek Yoghurt" case, FAGE UK Limited and Another v Chobani UK Limited and Another [2014] EWCA Civ 5 at [114]:

"Appellate courts have been repeatedly warned, by recent cases at the highest level, not to interfere with findings of fact by trial judges, unless compelled to do so. This applies not only to findings of primary fact, but also to the evaluation of those facts and to inferences to be drawn from them… The reasons for this approach are many. They include:

(i) The expertise of a trial judge is in determining what facts are relevant to the legal issues to be decided, and what those facts are if they are disputed.

(ii) The trial is not a dress rehearsal. It is the first and last night of the show.

(iii) Duplication of the trial judge's role on appeal is a disproportionate use of the limited resources of an appellate court, and will seldom lead to a different outcome in an individual case.

(iv) In making his decisions the trial judge will have regard to the whole of the sea of evidence presented to him, whereas an appellate court will only be island hopping.

(v) The atmosphere of the courtroom cannot, in any event, be recreated by reference to documents (including transcripts of evidence).

(vi) Thus even if it were possible to duplicate the role of the trial judge, it cannot in practice be done."

The 2007 and 2011 Wills

52. On 26 January 2007 Roger and Pamela executed mirror wills, drafted for them and with the benefit of advice given by a solicitor, Mr Lush, who had long acted for the Moore family in conveyancing matters, and had also acted for Roger when he made his first will in 1977. Some thirty years later, in January 2007, Mr Lush was approached by Roger and Pamela to update their wills, prior to their departure at the end of the month for an extended holiday. In the context of the present case, this was a significant time for several reasons. In the first place, Geoffrey had let it be known that he was intending to retire from the partnership, but he had not yet decided what to do with his share of the land and the business. Secondly, all of the pleaded representations upon which Stephen relies had by now been made by Roger. Thirdly, Roger and Pamela were by now in their mid-sixties, and so were naturally turning their thoughts to their own retirement in due course, and the destination of their estates when they died. Fourthly, the serious breakdown in family relations which began in 2009  still lay in the future; and, finally, there is no suggestion that Roger's mental facilities had yet begun to deteriorate to any significant extent.

53. I will begin by summarising the provisions of Roger's 2007 Will as executed. By clause 2, he appointed Pamela, Stephen and his son-in-law Andrew to be his executors and trustees. By clause 3, he gave to his trustees free of Inheritance Tax ("IHT") the "Nil-Rate Sum" (as defined) in order to constitute "the Discretionary Fund" of which trusts of a standard nature were then declared for a period of 21 years from the date of his death, in favour of a class of beneficiaries comprising Pamela, his children and grandchildren. The "Nil-Rate Sum" was defined as meaning:

"the largest amount of cash (or the equivalent net value of property appropriated in lieu thereof in accordance with any powers hereinafter contained) which can be given on the trusts of this Clause without any Inheritance Tax becoming payable in respect of the transfer of value which I am deemed to make immediately before my death."

Since the greater part of Roger's estate is agreed to have been composed of property which qualified for 100% relief from IHT, as either agricultural property or business property, it would seem to follow that the bulk of Roger's estate would have fallen within, or at least could have been appropriated to, the Discretionary Fund. In clause 3(e), Roger said:

"I declare (but without imposing any binding trust or legal obligation) that it is my wish that my Trustees shall regard my said Wife during her lifetime as the beneficiary having the greatest claim on the capital and income of the Discretionary Fund."

By clause 5, Roger then gave all the residue of his estate to Pamela absolutely, contingently upon her surviving him by thirty days.

54. Clause 5 then set out the dispositions which were to take effect if Pamela failed to survive Roger by thirty days. In that event, Roger gave to Stephen (subject to IHT) all his share and interest in the freehold property comprised in the farm at the date of his death. He gave to Julie, free of IHT, his interest in a property known as Pelican Cottage in Stapleford. Subject to those gifts, the residue of his estate was to be held on trust or sale and held as to one third for Julie, as to one half for Julie's children, and as to one sixth for Stephen's children.

55. Pamela's 2007 Will was in the same terms, mutatis mutandis, as Roger's.

56. The stages by which the 2007 Wills came to be executed in the above form, and the extent to which they truly reflected the intentions of Roger and Pamela at that time, were carefully considered by the judge in a section of his judgment running from [86] to [102]. In performing this exercise, the judge had the benefit of written and oral evidence from Mr Lush, Mr Butler and Pamela. The process began with a meeting on 16 January 2007 between Mr Lush, Roger and Pamela, which lasted for one and a half hours. In his contemporary attendance note, Mr Lush recorded that there had been "a general discussion" about the situation of Roger and Pamela, and their expectations. The note included the following points:

"1. Notwithstanding the very substantial (and mostly IHT free) value of the farm compared to their other assets (of which they provided a list) it is their firm intention that Stephen (now a Partner in the business) should have the farm and House although already they know that Julie is not happy with that potential inequality and will disapprove of it.

3. Whilst [Pamela] would not expect to go on living in Manor Farm House (Stephen would take it over) she would want somewhere to live (the cottage?) hence account of that might need to be taken in [Roger's] Will (on reflection it could be covered by the residue and/or NRBDT [i.e. Nil Rate Band Discretionary Trust]).

4. By reference to the combine[d] "non- farm" assets, the cottage to be left to Julie/Andy in any event, there would be approx 300K gross and it was agreed that pro rata Julie should have 100K, each of her children 75K and 50K to Stephen's Daughters aged 2 and 4…

5. Then I went through my usual NRBDT routine and I was satisfied that they understood the principle for trying to maximise use of both NRB whilst retaining flexibility of decision after [the] first had died. Hence that would be included in both Wills."

I should mention that the list of assets provided by Roger and Pamela to Mr Lush does not appear to have survived. The judge recorded Pamela's acceptance in cross-examination that the proposal at this meeting was that Stephen would inherit the farm and the house, and that if Roger predeceased her, and Stephen inherited, the proposal was that she would move into Ashburton. Mr Lush said in oral evidence that he assumed the reference to the farm included Roger's share of the partnership.

57. The draft will prepared by Mr Lush after this meeting no longer exists, but it was clearly sent to Roger and Pamela because Pamela telephoned Mr Lush on 22 January 2007 to discuss it. According to Mr Lush's note of this conversation, Roger and Pamela were happy with the essential form of the will, but Pamela was concerned that she should be able to continue living in the farm house for as long as she wished, even if Roger predeceased her. Mr Lush therefore suggested that the gift of Roger's share in the land and the farm house to Stephen should take effect on the death of the survivor of Roger and Pamela, and not (as the first draft evidently provided) on Roger's death. Pamela was content with this suggestion, because there was no need for Stephen to inherit until the death of the survivor of his parents. Mr Lush's note continued:

"If however she survives [Roger] then she will have control of his interest in the farm about which she will have two years within which to make decisions (assuming it is 100% APR then it can go into the NRB. However, thereby she will be able to decide what to do about her occupation of the house (again subject to Geoffrey's decisions as to the future)."

58. The judge did not comment specifically on this part of the attendance note, but it seems to me of some interest because it shows that Mr Lush was well aware that the exempt property would or could be placed in the Discretionary Fund, and that there would then be a period of two years after Roger's death when his trustees could decide on the destination of property within that fund without any adverse IHT consequences: this was evidently a reference to section 144 of  IHTA 1984, which enables such dispositions to be "read back" into the testator's will for IHT purposes. The note also reinforces the fundamental point that the whole future of the farming land and business remained uncertain until Geoffrey's intentions had become clear.

59. Mr Lush frankly accepted that he had no independent recollection of the events of January 2007, but on the strength of his attendance notes, and the provisions of the 2007 Wills themselves, he considered that Roger's central aim must have been to provide for Pamela. This evidence was rejected, however, by the judge, who said at [95]:

"In my judgment, Mr Lush's evidence that Roger's central aim was to provide for Pamela was not what he believed at the time; whilst Roger clearly must have intended that Pamela would be provided for, the central aim of the wills was to ensure the continuation of the business by Stephen."

To similar effect, the judge said at [99]:

"It is also clear that the primary intention of Roger and Pamela in January 2007 as recorded by Mr Lush was that Stephen should have the Farm. There were no reservations about this, whether on account of Stephen's behaviour or otherwise… In so far as Pamela was to be protected, it was by the use of the nil rate band discretionary trust, and I accept Mr Lush's evidence that it was intended that this trust was sufficiently flexible to do that."

60. Following his telephone conversation with Pamela on 22 January, Mr Lush prepared final drafts of the wills which were duly signed by Roger and Pamela on 26 January, at a further meeting which lasted for half an hour. According to Mr Lush's attendance note, Roger and Pamela:

"particularly accepted that this had been done in great haste due to their imminent departure on holiday and that therefore some fairly early review would be desirable both for better definition and according to whatever Geoffrey decides to do with his business/land interest when he retires. (September?)."

The judge took the view that the gift to Stephen in clause 5 of each will was "clearly intended to be the entirety of the farm", and that although Roger left the residue of his estate to Pamela outright, the underlying intention of both Roger and Pamela was that the farm should ultimately pass to Stephen. The judge rejected Pamela's evidence, repeated by her on many occasions, that under Roger's 2007 will "she would have been able to deal with the Farm as she saw fit", and that Roger "was insistent" on this. Such an intention would, in the judge's view, have been inconsistent with Mr Butler's discussions with Roger and Pamela, and with Mr Butler's understanding that Roger's wish was "to give Pamela some sort of life interest".

61. The judge's final conclusion was expressed in this way:

"100. …What is completely clear is that Roger's intention was that "the property was to pass down the various generations, and he considered that should be done regardless of comparative values". As Mr Lush noted, Roger was adamant about that. In my view Roger either may well not have understood the significance of the change from the draft will to the wills as executed, or he trusted Pamela to put into effect his wishes after his death and to pass the Farm to Stephen.

101. It is hard to conclude other than that the wills as executed did not accurately reflect the principal intention, to pass the Farm to Stephen. There is in my view considerable force in Miss Shea's criticisms of the failure of the wills to deal with the farming assets or Roger's share in the partnership (which under the wills would not go with the Farm but would fall into the residuary estate, which cannot have been the real intention) and her characterisation of the wills as a rushed botched job entered into in great haste in case they did not survive their holiday (Mr Lush confirmed in evidence that this was a concern)."

62. In my judgment, it is impossible for this court to interfere with the judge's clear findings about the underlying intentions of Roger and Pamela when the 2007 Wills were executed. The judge heard and reviewed all the evidence, including that of Pamela herself, and there are no grounds for saying that his conclusion was "plainly wrong" in the sense that no reasonable judge could have reached it. On any view, the 2007 wills were something of a rushed job, as Mr Lush himself recognised at the time. There was undoubtedly room for tidying up the definitions of the farm land and assets, and for making express provision in relation to Roger's partnership share. But nothing in the wills, to my mind, is incompatible with the firmly expressed underlying intention of both Roger and Pamela that Roger's share of both the farm and the business should devolve in due course on Stephen, whether by operation of the clause 5 gift on the death of the survivor, or by means of an appropriate appointment out of the Discretionary Fund. The picture which Pamela sought to portray at trial of herself having the absolute power of disposal over the farm after Roger's death, by virtue of the residuary gift in her favour, was in my view rightly rejected by the judge as unrealistic. He might have added that the bulk of Roger's interest in the land and business was in any event likely to fall into the Discretionary Fund, in which case it would be at the disposal of the trustees, of whom Pamela would be only one (together with Stephen and Andrew).

63. On the other hand, I think it is important not to overlook or underestimate the provision which Roger and Pamela did make for each other in these wills. Not only was each the other's residuary legatee, but the survivor was also expressly intended to be the beneficiary "having the greatest claim on the capital and income of the Discretionary Fund". Subject only to the underlying intention that Stephen should eventually inherit the farm, I can see no reason to doubt that these provisions did represent the true intentions of Roger and Pamela, albeit subject to possible revision when the position could be reviewed at leisure after Geoffrey's retirement.

64. Geoffrey's retirement was an important catalyst, because it removed the uncertainty about the future of his half share in the farm and the partnership. As I have already said, he transferred his share in the land and the farming business to Stephen, in return for a payment of £500,000 from the partnership which then continued between Roger and Stephen. I have also explained how the serious breakdown in family relations between Stephen and Jackie on the one hand, and Pamela, Roger, Julie and Andrew on the other, began in 2009.

65. The underlying difficulty, according to the judge, was Roger's reluctance to adjust to his reduced role on the farm, at a time when he was already beginning to have problems with his memory, combined with a growing feeling on Pamela's part that the over-arching plan for Stephen to inherit the farm was unfair on Julie, and of benefit only to Stephen, with whom she was becoming increasingly disenchanted: see the judgment at [109] to [110]. Pamela decided to address this perceived unfairness by proposing the introduction of Julie and Andrew into the partnership, and on 2 February 2010 a family meeting took place, attended by Roger, Stephen, Pamela, Jackie, Mr Butler and Andrew. According to the minutes taken by Andrew, which were later amended by Mr Butler, a number of matters were discussed and eventually Roger became very agitated and had to leave the meeting early. The judge accepted Jackie's assessment that the reason for Roger's agitation was that he was unable to cope, and that although Roger made some critical comments about Stephen, Roger did not get cross with him.

66. A particular bone of contention, so far as Pamela was concerned, had been Stephen's purchase of an expensive Nissan sports car, but the judge accepted Stephen's evidence that he had spoken to Roger about this, and the car had been bought with Roger's approval: see the judgment at [116]. The truth of the matter, said the judge, was that it was Pamela who deeply resented the purchase, and she could not accept the balance of power had changed since Geoffrey's retirement (ibid). The judge singled out two further points in the minutes as deserving of mention. First, Mr Butler said that the partnership needed to trust Stephen to take more decisions. Secondly, Jackie was noted as saying that Stephen "desperately needs the support and approval" of Roger, a comment which struck the judge as "particularly poignant".

67. More generally, the judge was justly critical of the fact that numerous allegations of misconduct of various kinds had been made against Stephen in the witness statements, which in the event were not pursued in cross-examination and therefore were not relied upon by Mr Thomas at the trial. The judge was also distinctly unimpressed by the few allegations of misconduct which were still pursued, concluding at [117]:

"In the circumstances, I entirely reject the suggestion that there was any real change in Stephen's behaviour following Geoffrey's retirement."

68. This was the background to the further changes in their testamentary dispositions which Roger and Pamela made in 2010 and 2011. In March 2010, they made codicils to their 2007 wills removing Stephen as an executor. According to Mr Lush's attendance notes, there had been some issues with Stephen, but Roger and Pamela still wanted "Stephen, and his family, to be able to carry on with the farm as long as they wish but not so that he can realise/receive the cash value as, on any disposal, those proceeds would become equally divisible between all of the Grandchildren".

69. On 26 January 2011, Roger and Pamela executed new wills which had been drafted for them by Mr Lush. The main changes from the 2007 wills were as follows:

a) the executors and trustees were now Pamela or Roger, Julie and Andrew;

b) there was no longer any nil rate band discretionary trust, but as before there was a gift of residue to the survivor of Roger and Pamela absolutely;

c) on the second death, there was a specific gift to Stephen (subject to any IHT attributable thereto) of Roger's share in the farming business and assets of the partnership, but excluding Roger's interest in any freehold property on or from which the business was conducted;

d) a flat in Swanage was given free of IHT to Julie and Andrew in equal shares;

e) there was a specific gift of the testator's interest in any freehold land on trust or sale, with a life interest for Stephen while it remained unsold; and

f) the residue (on the second death) was to be held as to five sixths for Julie and her children, and as to one sixth for Stephen's children.

70. In view of the absence of a nil rate band discretionary trust, the significance of the absolute residuary gift to the survivor of Roger and Pamela was potentially much greater than before. Unsurprisingly, Pamela sought to rely on this as showing that she would still have control if she survived Roger. The judge, however, rejected this evidence, finding at [120] that it "rang hollow" because the plan still was that Stephen would eventually inherit the business, albeit he would now have only a life interest in the freehold land. The judge's view was emphatic. He found Pamela's repeated statements that she would be able to dispose of the residue as she thought fit to be "less than frank", because in his view, as Pamela well knew, "there was never any question of anything happening other than Stephen, eventually, inheriting the business." The judge added, at the end of [120]:

"Even after what was according to Pamela by 2011 a period of bitter unhappiness with Stephen's behaviour (none of which other than the purchase of the Nissan was relied on by Mr Thomas) the intention was still that Stephen would inherit."

71. I confess to having some difficulty with the way in which the judge dealt with the 2011 wills, because he did not mention and seems not to have appreciated the potential significance of the removal of the nil rate band discretionary trust. Moreover, his view that the absolute gifts of residue to the survivor did not mean what they apparently said may be criticised as begging the question, and as attaching insufficient weight to the clear wishes of a testator expressed in a validly executed will. Nevertheless, any criticism must be tempered by the fact that the judge had the advantage (denied to us) of hearing and seeing all the evidence, and it seems to me on balance that he was entitled to find that the 2011 wills did not betoken any significant change in the underlying intention of Roger and Pamela that Stephen would in due course inherit the farming business, despite Pamela's increasing disappointment with aspects of his behaviour and her feeling that Julie and her family were being hard done by. Some concrete recognition was given to that feeling by the restriction of Stephen's interest in the land, on the second death, to a life interest while it remained unsold, and by the gift of five sixths of the residue to Julie and her family.

72. The judge may also have had in mind, although I do not think Mr Lush mentioned this, that a fuller investigation of all the circumstances might possibly have grounded a tenable argument that there was an enforceable agreement for mutual wills between Roger and Pamela: see generally Snell's Equity, 33rd edition, at paragraphs 24-032ff. A further, less speculative, point is that, by the time of the first death, the testator's estate would in any event be bound by any equity based on proprietary estoppel which Stephen had by then established, so the gift of residue to the survivor would necessarily take effect subject to it.

73. The 2011 wills marked the end of Mr Lush's involvement with Roger and Pamela's affairs. I should also mention, for completeness, that in June 2012 Roger executed a further will, which reintroduced a more sophisticated version of a nil rate band discretionary trust in the event that Pamela survived him, explicitly including in it all of his property which qualified for 100% agricultural or business IHT relief, and which also gave the whole of the residue to Pamela if she survived Roger by thirty days. By the time this will was executed, however, the parties had adopted increasingly entrenched positions, and Roger and Pamela were already represented by their present solicitors, Thrings LLP. As matters now stand, this is the will which will take effect on Roger's death, but neither side has suggested that it throws much, if any, useful light on the issues which we have to determine.

Open correspondence in 2012/13 from Stephen and his solicitors

74. I now turn to the passages in open correspondence upon which the appellant particularly relies as showing an acceptance by Stephen and his solicitors that Roger was in principle free to do as he chose with his share of the partnership and its assets.

75. The first passage is contained in a letter dated 20 April 2012 written by Stephen's solicitor, Mr Peter Williams, who was then with Wilsons Solicitors LLP, to Roger's solicitor, Mr Reeves of Thrings LLP. After dealing with a number of other matters, Mr Williams said:

"You state, in your letter of 16 April, that it is Roger's intention to transfer his interest in the Partnership to Julie and her husband, Andrew. It is entirely a matter for Roger if he wishes to do that. Stephen cannot stop Roger assigning the whole or part of his interests in the Partnership to Julie and Andrew or otherwise. If such assignment proceeds, please let me know."

76. In a further letter, dated 15 June 2012, Mr Williams repeated the same point:

"Stephen accepts that if his Father now wishes to divest himself of his interest in the business, he is free to do that by way of an assignment of his interest to Stephen's sister, Julie, and his brother-in-law, Andrew. There is nothing that Stephen can do to stop that."

77. Again, on 23 August 2012, Mr Williams, by now a consultant with VealeWasbrough Vizards, referring to his earlier letters, said:

"We did, however, say that plainly we could not object to Roger assigning his interest in the Partnership to Andrew (jointly to Julie, Stephen's sister or otherwise), if that is what Roger wanted to do. I have not heard anything further from you with regard to that."

78. On 12 November 2012, Mr Williams (now with Michelmores LLP) wrote again to Mr Reeves, repeating the same point in materially similar language.

79. Finally, on 14 January 2013, Stephen himself wrote to his father, offering a partition of the land and saying that, if this was not acceptable, he wished to take his interest out for the sum of £5 million. The letter concluded with this paragraph:

"You have persecuted me legally for 12 months and continually tried to control me. This is affecting my family adversely and so this offer is non- negotiable. You have a week to respond. If there is none then I will instruct valuation with view to sell."

This letter, it may be noted, was written after Roger had served notice of dissolution of the partnership on Stephen.

80. In none of these letters was any suggestion made that Stephen had an equitable claim based on proprietary estoppel, or that his father was not free to sell his share of the land and business to anybody he chose. It is therefore submitted for Roger that Stephen clearly did not believe the alleged promises upon which he now relies to be binding and irrevocable.

81. There is obvious force in this point, so it is important to see how the judge dealt with it. The relevant passage in the judgment runs from [77] to [83]. After referring to the relevant correspondence, the judge rejected a submission by Mr Thomas which relied on the decision of this court in Shirt v Shirt [2012] EWCA Civ 1029, where one of the reasons for rejecting a proprietary estoppel claim was its inconsistency with the pre-action correspondence. As the judge said, at [79]:

"Each case is different, and turns on its own facts. The question is always whether the promises were made. In my view, there is evidence that they were, and the question in relation to the correspondence is whether it can be elevated into being clear evidence that in fact they were not."

82. The judge then recorded Stephen's evidence that, at the relevant time, Mr Williams was intent on trying to get the parties to meet and resolve matters out of court. As to his suggestion of a partition, Stephen said that "this was a final and sensible attempt to avoid a legal battle". He did not want to say to his father that he had been promised the farm, because of his father's mental state at the time, which made him "irrational" and "very difficult to deal with". The judge then said, in [80]:

"It was clear to me that Stephen was deeply fond of his father and distressed at his state of his mind at that time; I have to say that I agree with Miss Shea that it would have been inflammatory of Stephen to assert an equity over Roger's share in circumstances where Stephen simply wished things to get back to how they were…"

Accordingly, the judge's assessment, repeated in [81], was that "Stephen through his solicitors and directly to Roger was trying to preserve the status quo without being inflammatory."

83. The judge was also influenced by some (admittedly rather sparse) evidence that Stephen had on one occasion in May 2012 written to his father saying "You have told me many times in the past that you would be leaving the farm to me", and a letter written by Roger's solicitors on 25 June 2012 which made it clear that Roger would not be transferring his share of the partnership to Stephen, and said "You may call this disinheritance if you wish". The judge noted that these exchanges took place at a time when, according to Pamela and to Thrings, Roger had capacity, yet no witness statement had been taken from him dealing with these points. It is true that the alleged promises were denied in the original reply and defence to counterclaim, which was verified by a statement of truth signed by Roger on 25 April 2013; but, in the judge's view, the force of that point was "somewhat diminished" because that pleading also averred that it was not envisaged or intended by Roger that Stephen would inherit Roger's interest, whereas that plea was contrary to the evidence which the judge had heard: see the end of [81].

84. In conclusion, therefore, while acknowledging that the points made by Mr Thomas had some force, the judge accepted the explanation given by Stephen. It would have been better, he said, if the estoppel claim had been mentioned in correspondence from the outset, but its absence was not fatal to Stephen's claim, especially as Roger could have replied in correspondence to Stephen's assertions that the promises were made, but did not do so: see [82] and [83].

85. In my judgment, these were findings that the judge was entitled to make. In the absence of any clear error or material misdirection, assessment of the evidence on this point was a matter for the judge, and it cannot be said that his conclusion was one that no reasonable judge could have come to. It is again necessary to remind oneself that the judge had the benefit of hearing and reading all the evidence over a lengthy trial, and that an appellate court faces all the disadvantages pointed out by Lewison LJ in the FAGE UK case.

The quality of the assurances, reliance, detriment and unconscionability

86. Having rejected Roger's challenge to the judge's findings of fact in the two key areas which I have examined, I can now deal much more briefly with the issues of the quality of the relevant assurances, reliance and detriment. In short, I consider that the judge directed himself appropriately, he considered the evidence with evident care, and his conclusions are again not open to challenge in this court in light of the principles which I have discussed. Thus, the questions whether the assurances which the judge found Roger to have made to Stephen were objectively intended to be acted upon, or whether Stephen should reasonably have regarded them as no more than non-binding statements of intention, were quintessentially a matter of fact and evaluation for the trial judge. So too were the interlocking questions of reliance and detriment. I have already quoted the key passages in the judgment, and I need not repeat them.

87. I should, however, say a little about the relevance of Stephen's succession to Geoffrey's share in the farm and the business. Mr Pymont made much of this point in his oral submissions, saying that it changed the whole complexion of the case because it gave Stephen everything that he had been promised by his father, namely a half share in the partnership. Accordingly, whatever the position may have been before Geoffrey's retirement, Stephen was now guaranteed all that his father could ever have given to him, with the consequence that any equity arising from Roger's promises was satisfied and it would not be unconscionable for Roger to use his share to satisfy the other claims to provision from his estate of Pamela, Julie and her family. The difficulty with this submission, in my judgment, is that it confuses Stephen's unexpected inheritance from his uncle with the promises made to him by his father, which can only have related to Roger's own share of the partnership. The submission also fails to have regard to the over-arching plan which was itself (on the judge's findings) a decisive consideration which led Geoffrey to prefer Stephen over his own sons when he retired. In my view, the equity arising from Roger's promises to Stephen can only have operated in relation to Roger's own half share of the partnership, and the judge was right to regard Stephen's inheritance from Geoffrey as irrelevant to the issues of detriment and unconscionability.

88. For all these reasons, therefore, and leaving aside for the moment the subsidiary issues relating to particular assets, I would reject the grounds of appeal which seek to challenge the judge's conclusion that the equity pleaded by Stephen was established on the facts. The next, and in my judgment critical, question is whether the judge was also right in his reasoning and conclusions about how the equity should be satisfied. That is the issue to which I will now turn.

The grounds of appeal (2): satisfaction of the equity

89. I have already described how the judge decided that Stephen's equity should be satisfied, and set out the relevant terms of his order of 19 August 2017. The guiding principle which he followed, accepting the submissions of Ms Shea for Stephen, was that he should exercise his discretion "by mirroring as closely as possible the arrangements which would have obtained had the dispute not arisen": see [34] above.

90. I am sure that the judge thought long and carefully before adopting this solution, and that he saw it as the minimum that was necessary to satisfy Stephen's equity. Nevertheless, there are in my opinion a number of serious difficulties with the judge's approach and with the regime which he put in place to implement it.

91. In the first place, Stephen's pleaded case was only that he would inherit his father's share of the farm and the business on the death of the survivor of his parents, and subject to reasonable provision being made for Pamela during her widowhood if Roger were the first to die. Stephen's expectation was therefore a future one, and he must objectively have realised that his eventual inheritance would have to be subject to (although it could not be defeated by) such reasonable provision as Roger might choose to make for Pamela, both before and after his death. Consistently with this, the mirror wills which Roger and Pamela made in 2007 and 2011 would have given Pamela a significant degree of control over, and benefit from, Roger's estate after his death. Not only would she have been one of Roger's executors and trustees under each will, and the primary beneficiary of the Discretionary Fund under the 2007 will, but she would also have been the sole residuary legatee under each will on surviving her husband. Of course, these testamentary dispositions were in principle revocable and liable to be changed, and on the judge's findings Pamela shared with Roger (at least until 2011) the overriding intention that Stephen should eventually inherit the farm and the business. Subject to that constraint, however, Roger's clear intention was that Pamela should have access to both capital and income after his death, and that she should be the sole beneficiary of all the non-farming assets comprised in his residuary estate.

92. To state the obvious, there is nothing remotely surprising about this. Roger and Pamela have enjoyed a long, close and happy marriage for over fifty years. Pamela has made a home with Roger at the farm house throughout that period, until his deteriorating health meant that he could no longer live there. She has brought up their family, and provided support for Roger. Her own career as a teacher has often had to take second place. Thus the provision for Pamela made by Roger in his 2007 and 2011 wills is no more than one would naturally expect to find.

93. Secondly, it seems to me that Stephen's pleaded case, and the assurances upon which he relied, envisaged that the partnership would continue until Roger's death or retirement, and that relations within the family would remain harmonious. Sadly, however, neither of those expectations has been fulfilled. Roger served notice of dissolution of the partnership in December 2012, and it is now common ground that, whether or not the notice was valid, the partnership must in any event be dissolved because of Roger's incapacity. As to the breakdown in family relations, the parties have become increasingly entrenched over the last nine years, all attempts to resolve the dispute amicably have failed, and the rift between Pamela and Stephen regrettably seems to be deeper than ever. In those circumstances, the need for a clean break solution is in my view compelling. As Robert Walker LJ said in Jennings v Rice at [52], the court "cannot compel people who have fallen out to live peaceably together". Although no doubt primarily directed to cases where the warring parties are living under the same roof, the practical wisdom of this recognition applies with the same or scarcely less force in situations where they are living in close proximity to each other and in a relationship of continued financial dependence. That, however, is precisely the position brought about by the judge's order, whereby Pamela will continue to live in the farm house or Ashburton as a mere licensee, she will be dependent on Stephen for a meagre weekly income for the rest of her life, she will constantly have to ensure that the outgoings specified in the order are duly paid by Stephen and she will have to notify any want of repair or condition to him before it can be rectified. Similarly, there will be endless scope for dispute about the nature and cost of any nursing, health or residential care which either Roger or Pamela may need for the rest of their lives.

94. Thirdly, the judge's approach implies that he regarded the case as one of the first type discussed in Jennings v Rice, that is to say one where "the assurances, and the claimant's reliance on them, have a consensual character falling not far short of an enforceable contract",  and where "the court's natural response is to fulfil the claimant's expectations": see [45] and [50]. I can understand why the judge may have taken that view, because Stephen has spent his adult life working on the farm in reliance on the promises which were made to him, and has suffered a corresponding detriment. But it would in my view be a dangerous over-simplification to regard this case as a paradigm example of the first type. As I have already emphasised, Stephen's expectation has always been that he would inherit the farm on the death of the survivor of his parents, with proper provision being made for Pamela in the meantime. Thus his claim would only be a clear example of the first type if it were brought after the death of the survivor, in a situation where Stephen had continued to work on the farm until that date and there had been no material change in circumstances meanwhile. By the time of the trial, however, it was already abundantly clear that this was no longer a realistic scenario. Roger's worsening health meant that the partnership could not continue, relations within the family had irretrievably broken down, and it was clear that fresh arrangements would have to be made in light of the changed circumstances. Again, one of the factors listed in Jennings v Rice at [52] is apposite: "alterations in the benefactor's assets and circumstances, especially where the benefactor's assurances have been given, and the claimant's detriment has been suffered, over a long period of years".

95. Fourthly, although it was in principle open to the judge to adopt a solution which accelerated Stephen's entitlement, by directing an immediate transfer to him of all Roger's interest in the partnership land and business, it was essential that this acceleration should not be at the expense of the proper provision for Pamela and Roger during the remainder of their lives to which Stephen's expectation was always subject. The judge clearly had in mind the very significant acceleration which his order entailed, but he then adopted a minimalist approach to the provision that Stephen should make for his parents in return for the acceleration, by seeking to replicate what would have happened on the wholly unrealistic assumption that no dispute had arisen. This was in my view a clear misdirection. The judge's focus should have been on the minimum provision that was needed to satisfy Stephen's equity, and if this meant that Roger's share in the farm and the business should be transferred to Stephen immediately, it was all the more important for the judge to provide full and generous protection for Roger and Pamela during the remainder of their lives, and to reflect as far as possible the provision that Roger would have wished to make for Pamela on his death.

96. Fifthly, although the judge ordered the immediate transfer by Roger to Stephen of assets probably worth in the region of £5 million, it is notable that he said nothing about the taxation consequences of his order. That is regrettable, not least because another of the relevant factors identified in Jennings v Rice is "the likely effect of taxation". The impact of IHT, capital gains tax ("CGT") and income tax all needed careful consideration, with the benefit of expert evidence, or at least submissions from counsel well versed in the relevant areas of tax law. Despite the vast amounts of money spent on this litigation, the judge was unfortunately left with next to no assistance on this important subject. Counsel on both sides had no relevant expertise, there was no expert evidence, and although the partnership accountant, Mr Butler, gave evidence in the form of a lengthy and discursive agreed witness statement, he was called as a witness of fact, his statements about the impact of taxation were of a generalised nature, and neither he nor anybody else was asked to advise on the taxation consequences of the immediate transfer of assets ordered by the judge. In my view, this should be as unacceptable in a substantial proprietary estoppel case as it would be in a big money divorce case. The upshot is that Mr Pymont informed us that the judge's order, if implemented, would give rise to significant CGT and income tax liabilities, but he was unable to provide chapter and verse in support of the submission, or to explain what the likely financial impact would be. This also reflects a more general point, which is that the court did not have before it any up to date valuations of the partnership land and business, or of the other freehold properties in which Roger had an interest. It seems to have been common ground that the total value of the farm was around £10 million, but this was no more than a rough estimate, and all particularity was lacking.

97. Finally, the judge does not appear to have considered the impact of the costs orders which he made on the financial arrangements laid down in the order. What, for example, was to happen if Roger was unable to pay the £400,000 on account of costs ordered by the judge to be paid within three weeks? And even if that sum could somehow be paid, despite the immediate transfer of all Roger's farming assets to Stephen, would Stephen subsequently be entitled to set off the judge's order for costs in his favour against his financial liabilities under the order, including (most pressingly) his obligation to pay for Roger's care? In this context, the judge does not appear to have made any findings about the resources available to Roger and Pamela, although the evidence before him included Pamela's witness statement on the costs application made to Newey J in February 2016 and the schedules of her and Roger's income, expenditure, assets and liabilities exhibited thereto. Even at that date, Pamela's evidence was that Roger had insufficient available funds to pay for his legal representation at trial, and he already owed approximately £415,000 plus VAT to his solicitors. As to Pamela's own assets, her evidence was that she had only modest cash resources, and a half share in the flat at Swanage which was being charged to Thrings LLP in respect of their fees.

98. Taking all these matters into account, I am satisfied that the judge's order cannot stand. Although he had "a wide judgmental discretion" in deciding how the equity should be satisfied, his solution was based on the false premise that the position at the date of trial could somehow be equated with the position on the future death of the survivor of Roger and Pamela, despite the fundamentally changed circumstances brought about by the dissolution of the partnership, Roger's lack of capacity, and the breakdown in relations within the family. Furthermore, the judge's solution forced the parties to remain financially dependent on each other, when a clean break was clearly called for, and it paid insufficient regard to Pamela's claims on her husband's estate as a partner to a long and happy marriage which fortunately still subsists. The effect of the judge's order was to leave Pamela locked into a continuing financial relationship with her estranged son Stephen, with few significant resources of her own which were not already swallowed up in costs, and with a fixed income derived from the farm of only £200 per week for the rest of her life. On any view, this was in my judgment far too high and disproportionate a price to pay for achieving the objective of enabling the farm in its entirety to remain in a single pair of male Moore hands for a fourth generation.

99. With the benefit of hindsight, it is in my view also clear that the judge lacked sufficient information to reach a final conclusion on how the equity should be satisfied after the trial in July 2016. As I have pointed out, he was (through no fault of his own) unable to evaluate the tax consequences of his preferred solution, nor did he have any up to date valuations. He was also not helped by the fact that counsel for Roger had not put forward any concrete proposals to set against Ms Shea's submissions, in the event that Stephen's alleged equity were found to be established. Instead, in both his written opening and closing submissions, Mr Thomas had contented himself with making a brief reference to the principles which the court should follow, referring to Jennings v Rice, and submitting that in the present case it would not be appropriate to give Stephen any of Roger's share. Thus the only detailed proposals which the judge had before him were the relatively extreme ones for which Ms Shea was contending.

100. Despite this handicap, however, the judge ought in my opinion to have realised that, having made his findings on the establishment of the equity, he could not fairly decide how it should be satisfied without a further hearing for which appropriate directions should have been given. There was no intrinsic urgency which required the order to be made in August 2016, and the judge could perfectly well have ordered, if necessary of his own initiative, that the matter should be restored before him in the following term. The need for fuller information and assistance was in my view all the more pronounced if the judge was provisionally minded to accede to Ms Shea's submissions, precisely because they were of such a relatively extreme (although legitimately arguable) nature. That was, after all,  what her duty to her client demanded. But the judge had to reach a conclusion which was proportionate, and fair to Roger and Pamela as well as to Stephen. If justice required an adjournment to enable the judge to perform that task, then that is the course which the judge should have followed, whether or not the parties asked him to do so.

101. What, then, is to happen now? Regrettable though it is to involve the parties in yet more litigation, I fear I can see no alternative to remitting the case for a further hearing on how the equity found to be established by the judge should be satisfied. This court simply does not have the necessary information, any more than the judge did, to make a final decision at this stage. On the other hand, it is clearly desirable that we should give as much guidance as we reasonably can, with a view to minimising the scope and cost of the further hearing, and encouraging the parties to reach an agreement. The guidance which I consider it appropriate to give, if the other members of the court agree, is contained in the following paragraphs.

102. In principle, and subject to what I say below about the raising of a lump sum for Pamela and the impact of taxation, I agree with the judge that Roger's share in the land and the partnership assets should be transferred to Stephen. Given Roger's incapacity, there is no way in which he can continue to farm during the remainder of his life, and since Stephen already owns the other half share of the farm and the business, and has in practice already been running the farming operations for a number of years, it makes obvious sense to bring forward the implementation of this key aspect of the over-arching plan identified by the judge.

103. On the other hand, the acceleration that this involves must not be allowed to prejudice the interests of Roger and Pamela, including Pamela's reasonable expectations as Roger's wife and probable future widow. Furthermore, so far as Pamela is concerned, a clean break solution is needed. In practice, this means in my judgment that she must be provided with a lump sum which will enable her to rehouse herself comfortably in appropriate accommodation of her choice, to enjoy a reasonable income, and to have sufficient capital (together with her other assets) to enjoy holidays and occasional luxuries, to provide for Roger (over and above the basic costs of his care), to make gifts to her daughter and grandchildren, and to have a cushion for contingencies. This lump sum must be raised by Stephen within a fairly short period, measured in months rather than years. It may require the sale of part of the farm, or Stephen may be able to borrow the necessary amount on the security of the farm. Either way, tax advice will be needed on the most efficient way of raising the lump sum and of transferring Roger's interest in the relevant assets to Stephen. Any IHT or CGT liabilities which arise as a direct consequence of the transfer of assets and the raising of the lump sum must be borne by Stephen, and he must indemnify Roger and his estate for any such liabilities which fall upon Roger.

104. The amount of the lump sum is probably the single most important point which the judge will have to decide. Much will depend on evidence of local housing costs, assuming that Pamela does not wish to move far away, and on up to date evidence of any other financial resources available to Roger and Pamela once the impact of costs has been taken into account. At one point in his oral submissions, Mr Pymont indicated that a lump sum of £3 million on a clean break basis might be acceptable to his client. In my view that figure is clearly too high, and I consider that the appropriate figure will probably lie somewhere between £1 million and £2 million. Whatever figure the judge considers to be appropriate, it should in my view bear interest at a reasonable (non-penal) rate from 19 August 2016 until the date of payment.

105. Until the lump sum has been raised and paid to Pamela, and she has been re-housed, the provisions of the judge's existing order should remain in force, but with a general liberty to apply (not confined as in paragraph 8 of the existing order) and with an increase in the weekly payment to Roger and Pamela from £200 to £300 back-dated to 19 August 2016. According to Mr Butler, the drawings taken by the partners in this partnership were "very low indeed", which I can well believe. Furthermore, there appears to have been no increase in the basic figure of £200 per week for decades. On any view, I consider that the judge should have substantially increased it, and £300 is the absolute minimum that I would consider acceptable pending the clean break.

106. Once Pamela has been rehoused, the provisions in paragraph 5 of the existing order will lapse; and once the lump sum has been paid to her, the weekly payments will also cease. That leaves the question of health and care costs, as provided by paragraph 7 of the judge's order. Once the clean break has been effected, it seems to me appropriate that Pamela should be responsible for her own future health and care costs as she will now have capital resources of her own. On the other hand, I see no good reason why Stephen should not continue to be responsible for the costs of his father's care, but for the avoidance of doubt it should be made clear that he must pay the reasonable costs of such care promptly and without any set off. Similarly, Stephen must make the continuing weekly payments to Pamela (including the back-dated increase), and must comply with his other financial obligations under the judge's order during the transitional period, without any set off, whether in respect of costs or otherwise.

107. I add a final word on the vexed subject of costs. Clearly, the costs of the proceedings below, and of this appeal, will have to be considered afresh by us in the light of the parties' written submissions after our judgments have been circulated in draft to counsel. I do not wish in any way to pre-empt what our decision will be, save to make the obvious points that Stephen still had to bring the present action in order to establish his equity, but Roger will have achieved a substantial measure of success on this appeal. As I said at the start of this judgment, the total costs already incurred on both sides are shockingly high. The likelihood must be that, even after allowance is made for Roger's substantial (but far from complete) success on this appeal, a very large net sum will still end up payable by Roger to Stephen. How, then, is that probable liability to be taken into account in calculating the lump sum which must be raised for Pamela? In my judgment, harsh though it may seem to Stephen, the right course is to direct that the amount of the lump sum must be assessed in the first instance without reference to any unsatisfied costs liabilities in Stephen's favour. I would then leave it to the judge to decide whether (and, if so, to what extent) there should be any set off against Stephen's liability to pay the lump sum in respect of any costs liability owed to him by Roger.

108. A further potential issue is whether the resumed hearing should take place before the same judge. While I would be willing to entertain written submissions on this point, my strong inclination at the moment is to direct that the matter be remitted to the same judge, assuming he is still available. Although I have been critical of some aspects of his approach and reasoning on the question of how the equity should be satisfied, he was left in a difficult position by the failure on Roger's side to present him with a viable alternative to the extreme position espoused by Ms Shea. The judge dealt admirably, if I may say so, with nearly all the complex issues of fact and law relating to the establishment of Stephen's equity, and I am confident that with the guidance given in this judgment he will be well placed to deal afresh with the question of how the equity should be satisfied. Unless it is unavoidable, it would be a pity if this question had to be decided by anybody other than the trial judge.

The grounds of appeal (3): subsidiary issues

109. I now come to the subsidiary issues, which concern the position of the Company, the question whether Stephen's equity extends to the assets of the Company and to Roger's current account with the partnership, the findings about specific assets made by the judge in the supplementary judgment, and the question whether the partnership between Roger and Stephen was a partnership at will or for joint lives.

(a) The position of the company

110. Ground 8 complains that the judge was wrong to declare that Stephen had an equity over Roger's share of the assets of the Company, because he overlooked the facts that no relief was sought against the Company (although it was a defendant), it had paid full value for its assets, and Roger in his personal capacity did not beneficially own any of those assets.

111. In my view, this complaint has no real substance. It is true, of course, that the Company is a separate legal person, and its assets are beneficially owned by the Company, not its shareholders. Technically, therefore, the judge was wrong to the extent that he seems at times to have treated Roger as beneficially entitled to a share of the Company's assets, and the definition of "the Claimant's Company Interest" in the judge's order is open to the same criticism. But nothing turns on this, because Roger and Stephen were the sole shareholders and directors of the Company and it was under their joint control, as the judge found. Indeed, Roger was the majority shareholder, holding 51% of the shares. Furthermore, the Company was an integral part of the farming business, having been formed in 2008 on Mr Butler's advice mainly for tax reasons, but also as a vehicle for contracting operations. It follows that the parties must realistically have intended Stephen's equity to extend to Roger's shareholding in the Company, and thus indirectly to the assets owned by the Company. The only machinery needed to give effect to this intention, as it seems to me, is an order that Roger transfer his shares in the Company to Stephen, and (if this has not already happened) resign as a director.

(b) Roger's partnership current account

112. The judge found at [171] that Roger's interest in the partnership clearly included his current account. The judge said "Mr Butler's unchallenged evidence was that the current account stood both as part of Roger's interest under the partnership and as assets of the partnership." The judge also found support for this view in the way that Geoffrey's current account had been treated on his retirement:

"… as Mr Butler explained, there was no question of Geoffrey actually treating the value of his current account as being his – at all times the driving factor was tax efficiency. Partnership profits were understood and agreed to be retained within the business subject to agreed levels of drawings…"

Grounds 9 and 10 challenge the judge's conclusion on this point.

113. At first sight, the judge's conclusion may appear rather strange, because the sums credited to Roger's current account represented partnership profits allocated to him on which he had paid income tax, and even if they were retained in the business, one would normally expect the current account to represent a debt owed by the partnership to the partner concerned. The judge's only answer to this was the agreement between the partners to retain profits within the business subject to agreed levels of drawings. But this finding, submits Mr Pymont, fails to take account of the status of the sums as profits which had been allocated and divided between the partners, as reflected in the annual partnership accounts which they had signed.

114. As a matter of accounting and legal principle, this submission seems to me probably correct. But it does not answer the question whether Stephen's equity should properly be regarded as extending to Roger's share of historical profits which he had effectively ploughed back into the business. In practice, it seems clear that the partnership arranged its finances on advice from Mr Butler, and the partners reinvested their undrawn profits as further working capital. They did not regard themselves as free to withdraw such reinvested profits without agreement, whatever the strict legal position may have been. As a practical matter, therefore, I think the judge was entitled to find that Roger's partnership interest included his current account.

115. The matter does not end there, however. The amount involved is substantial: we were told, without being taken to any documents, that the balance standing to the credit of Roger's current account exceeds £500,000. The fact that Roger decided to plough back such a large amount of allocated profits on which he had paid tax is in my judgment a material factor for the court to have in mind when fixing the amount of the lump sum to be provided for Pamela. This was in principle money which Roger could have taken out of the business, had the need to do so arisen, and this fact should in my view encourage the court to make generous provision for Pamela and Roger in deciding how to satisfy Stephen's equity.

(c) Ashburton and the Little House

116. The judge decided in the supplementary judgment that Roger's beneficial half share in these two properties formed part of the partnership assets, although the other half share has since 2008 belonged to a family trust established by Geoffrey. It seems clear to me that there was evidence which entitled the judge to reach this conclusion. For example, Stephen confirmed in cross-examination that the Little House and Ashburton were included in the properties which his father had promised to him, and there was also unchallenged evidence from Geoffrey that both properties were partnership properties. The existence of the separate trust over Geoffrey's half share no doubt explains why the legal title to these properties remained vested in Roger and Geoffrey, but there is no incompatibility between that and Roger's half share being a partnership asset.

(d) The Water Meadows

117. The position is similar in relation to this property, which had originally belonged to John Moore and was given by him to Richard, from whom Roger and Geoffrey later bought it. Mr Butler's evidence was that it then became a partnership asset, although when Geoffrey retired his half share in the property was transferred out of the partnership and invested by Geoffrey in a self-invested pension plan. There was no change in relation to Roger's half share, and the judge was in my view plainly entitled to find that it continued to be partnership property.

(e) Was the partnership a partnership at will?

118. The final issue is  now of only academic interest, because it is common ground that the partnership must be dissolved on the ground of Roger's incapacity, even if the judge was right to find that the partnership was one for joint lives and not at will. There has never been a written partnership agreement of any description, so the question was one of fact and inference for the judge to determine. For reasons which I have already rehearsed, this court will be very slow to interfere with such a finding in the absence of any discernible error.

119. The judge gave his reasons for reaching this conclusion at [183]. He recognised, correctly, that a partnership at will is the default position, in the absence of an express or implied agreement to the contrary. Stephen submitted that an agreement to the contrary was to be implied from the circumstances surrounding his becoming an equal partner in 2008, the common intention of himself and his father being that the partnership should endure for their joint lives. The judge then said:

"At that stage it had never been contemplated by anyone that the Partnership would not endure until Roger's death. The concept of dissolution of the Partnership was unknown to Roger and Stephen, and if anyone had asked them in 2008 whether it would have been permitted under the Partnership for one partner to seek to terminate the Partnership prior to death, the response would have been negative. I agree with Ms Shea that the basis of the planning in 2008 is compelling support for the implication of an agreement that the Partnership was to be for the joint lives of Roger and Stephen, and that this was borne out by the evidence at trial…"

120. In my view, it cannot be said that the judge erred in reaching this conclusion. According to the judge's findings, the "over-arching plan" formed the basis upon which Stephen succeeded to Geoffrey's share in the partnership, and it must have been the common (if unarticulated) intention of Roger and Stephen that the new partnership between them should continue during their joint lives. At the very least, this was again a conclusion which the judge was entitled to reach.

Overall conclusion

121. For the reasons which I have given, I would allow Roger's appeal on the issue of how Stephen's equity should be satisfied, but dismiss his appeal on all other grounds.

Leggatt LJ:

122. I agree.

Floyd LJ:

123. I also agree.