The Gazette 1985

GAZETTE

JULY/AUGUST 1985

The Mistaken Improver of Land

by Robert A. Pearce, B.C.L., M.A. Lecturer in Law, University College, Cork.

T HE traditional view concerning the person who expends money upon land in the belief that the land is his own is that: "the mere fact that the stranger was mistaken does not give him any right at law or in equity to recover from the owner either the value of the improve- ments or the value of his services . . .(The improver) will obtain relief only if the defendant has acquiesced in what he did". 1 This view falls for re-examination in the light of the High Court decision in McMahon -v- Kerry County Council. 2 The County Council in that case had mistakenly built two houses on the McMahons' land. Despite the fact that the McMahons had no knowledge whatsoever of the building taking place, Finlay P. refused to allow them to recover possession from the Council, provided that the Council compensated the McMahons for the loss of the vacant site. The Council was thus in effect given relief enabling it to retain the value of the improvement it had made to the land. The legal basis of Finlay P.'s decision was that the principle of proprietary estoppel explained in Ramsden -v- Dyson 3 is part of a wider equitable principle under which the court can grant relief to a person who mistakenly improves the land of another, even though there may be no acquiescence or encouragement on the part of the owner. This view is so innovative that it is surprising that the case has not received more attention. 4 Background To appreciate the significance of McMahon -v- Kerry County Council it is necessary to examine what was previously understood to be the law. As with a number of other legal principles, the status of proprietary estoppel in Ireland was somewhat unclear. It was treated by practi- tioners and academics as part of Irish law even though the only reported Irish case on the subject prior to McMahon - v- Kerry C. C. 5 suggested that the doctrine might have a more limited application in Ireland than in England. 6 This was the case of Cullen -v- Cullen. 1 It concerned the right of a son to remain in a mobile home he had installed on his father's land. Mrs. Cullen had won a fully furnished portable home in a competition in a Sunday newspaper, the "Sunday Press". She gave it to Martin, one of her sons. He began to prepare a site for it on his own lands, but Mrs. Cullen requested him to erect it nearer to her on her husband's lands and to that end sought permission from Mr. Cullen. Relationships with Mr. Cullen were at that time strained, and as part of a resolution of the family differences Mr. Cullen was proposing to make over his lands to Mrs. Cullen. In his reply to Mrs. Cullen's request, Mr. Cullen, through an intermediary, indicated that since the lands would be given to the mother, the mobile home could be put where she liked. Martin accordingly put the

house on his father's land at a cost of about £200 and with his own labour. Kenny J., the trial judge, was "convinced that the plaintiff (Mr. Cullen) knew at all times that Mrs. Cullen had given the house to Martin and that the house was being erected for Martin to live in". 8 Family relations subsequently worsened and Mr. Cullen, in court proceedings sought to exclude Martin from his land. Counsel for Martin sought to rely upon the case of Ramsden -v- Dyson. 9 Kenny J., while appearing to accept the application of the principle of Ramsden -v- Dyson in Ireland, rejected the argument of counsel. In his view: "that case decides that if a stranger begins to build on land which he thinks is his and the real owner, seeing the mistake, abstains from correcting it and leaves him to continue, equity will not afterwards allow the real owner to assert his title to the land; but that if a stranger builds on land knowing it to be the property of another, equity will not prevent the real owner from claiming the lands afterwards". 10 Since Martin knew that the land belonged to his father, he could not rely upon the case. This interpretation of Ramsden -v- Dyson is clearly drawn from the explanation of the doctrine of proprietary estoppel by Lord Cranworth L.C. 11 It is not consistent with the somewhat broader statement of Lord Kingsdown. 12 Although it formed part of a dissenting speech, the divergence of opinion in the House of Lords was only as to the applica- tion of the facts to the principle. There was no disagree- ment as to what was the true principle. 13 According to Lord Kingsdown, "If a man, under a verbal agreement with a landlord for certain interest in land, or, what amounts to the same thing, under an expectation, created or encouraged by the landlord, that he shall have a certain interest, takes possession of such land, with the consent of the landlord, and upon the faith of such promise or expectation, with the knowledge of the landlord, and without objection by him, lays out money upon the land, a Court of equity will compel the landlord to give effect to such promise or expectation". 14 The view Kenny J. took in Cullen -v- Cullen 15 is also inconsistent with the case of Plimmer -v- Wellington Corporation. 16 There the plaintiff carried out improve- ments to a jetty, not under any mistake that he was the owner, but in the expectation that his occupation would not be disturbed. The Privy Council were of the opinion that in the circumstances the plaintiff should be declared to have a perpetual licence. Unfortunately Plimmer -v- Wellington Corporation was not referred to by counsel in Cullen -v- Cullen. Dillwyn -v- 179