'One Day All This Will Be Yours' - Guest v Guest Judgment Handed Down By Supreme Court
The Supreme Court recently reached an important verdict surrounding whether a verbal promise can legally be enforced.
What Was the Case About?
A multigenerational family of dairy farmers, the Guests, found themselves arguing before the highest court in the land - the Supreme Court - over an unwritten promise that the family farm would go to the son that helped them on the farm.
The family’s eldest son, Andrew, left school at the age of 16 and worked long hours on the farm for nearly 33 years, being paid a basic wage. Sadly, the relationship between Andrew and his parents, David and Josephine, deteriorated over the years and Andrew left the farm in 2015.
In 2017 Andrew brought a proprietary estoppel claim, arguing that he was entitled to receive a share of the farm as a result of assurances made by his parents that he would one day inherit a significant proportion of it. The court ordered his parents to make a payment to him amounting to 50% of the value of the farming business and 40% of the value of the farm itself. The inevitable consequence of that order was that his parents would have to sell the farm.
The parents appealed against the judgment and the long awaited Judgment from the Supreme Court was handed down today - Wednesday 19 October 2022. The question for the Supreme Court to decide was whether Andrew should be able to keep his original award handed down by the lower court and approved by the Court of Appeal. Or, as the parents argued, that the award which would have meant the sale of the family farm was compensation that had gone a step too far.
What Was the Verdict?
The five Law Lords who decided the case were not in agreement and so the decision was by a 3-2 majority. In the words of Lord Briggs, who gave the leading judgment, Andrew's parents are "spared, if they so choose, the injustice of having to sell up and leave early" and they are given the opportunity "of a completely clean break at a considerably lower price than that ordered by the Judge".
The judgment in effect delays Andrew's right to take a share of the farm now. However, should they choose to allow their son to take possession of the farm before their deaths, the parents have been given a mechanism by the Supreme Court to help them identify the discount they should give to Andrew for him to acquire it now. If the parents decide to offer the farm to Andrew before they die but they still cannot agree on the amount, the case will have to go back to Court.
The judgment underlines just how notoriously difficult it is to value the detriment suffered in these sorts of cases and it is noteworthy that the five leading Law Lords could not agree. What this decision seems to have introduced is that those who have to pay the price of reneging on a promise will sometimes have a choice as to how they make good their promise.