Lloyd v MGL (Rugby) Ltd & Anor

Lloyd v MGL (Rugby) Ltd & Anor

The doctrine of proprietary estoppel applies because Mr Sutcliffe acted to his detriment in reliance on a clear and persistent understanding, encouraged by Mr Lloyd and MGL, that he would share in the profits of the Willes Road development. The entire agreement clause did not preclude reliance on extraneous understandings as the arrangements for Willes Road were not 'dealt with' in the agreement, and in any event, the understanding was reiterated after the agreement. The equity attaches primarily to MGL but may also be satisfied by Mr Lloyd personally if he has received profits. It would be unconscionable to deny Mr Sutcliffe a share in the profits.

Parties
First Defendant / First Appellant: William David Lloyd; Second Defendant / Second Appellant: MGL (Rugby) Limited; Claimant / Respondent: Andrew Michael Sutcliffe
Jurisdiction
England and Wales
Judgment Date
28 February 2007
Procedural Posture
Civil Appeal / Appeal From High Court (chancery Division) on Preliminary Issue of Liability
Outcome
Appeal dismissed
Legal Topics
Proprietary Estoppel, Joint Venture, Entire Agreement Clause, Remedies in Equity
Equity Property Law Contract Law Proprietary Estoppel Joint Venture Entire Agreement Clause Remedies in Equity

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Parties

William David Lloyd

First Defendant / First Appellant

MGL (Rugby) Limited

Second Defendant / Second Appellant

Andrew Michael Sutcliffe

Claimant / Respondent

Procedural Posture

Civil Appeal / Appeal From High Court (chancery Division) on Preliminary Issue of Liability

Legal Issues

  1. 1 Whether the doctrine of proprietary estoppel applies to entitle the claimant to a share of profits from property development at Willes Road
  2. 2 Whether the entire agreement clause in the 15 January 2002 agreement precludes reliance on extraneous understandings
  3. 3 Whether the equity can be enforced against both the company (MGL) and Mr Lloyd personally

Ratio Decidendi

The doctrine of proprietary estoppel applies because Mr Sutcliffe acted to his detriment in reliance on a clear and persistent understanding, encouraged by Mr Lloyd and MGL, that he would share in the profits of the Willes Road development. The entire agreement clause did not preclude reliance on extraneous understandings as the arrangements for Willes Road were not 'dealt with' in the agreement, and in any event, the understanding was reiterated after the agreement. The equity attaches primarily to MGL but may also be satisfied by Mr Lloyd personally if he has received profits. It would be unconscionable to deny Mr Sutcliffe a share in the profits.

Court Disposition

Appeal dismissed

Orders

  • Declaration that an equity has arisen in favour of Mr Sutcliffe to be satisfied by MGL and, upon inquiry, possibly by Mr Lloyd
  • Directions for further hearing to determine the nature and extent of the equity