England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
BIRMINGHAM DISTRICT REGISTRY

		29 July 2005

Mr. Justice Hart:

Synopsis of claims

1. This is a case about a yard in Pool Road, Nuneaton. It was once owned in its entirety by David Brandish ("the father"). In April 2001 he transferred part of the yard, representing about 40% ("Yard 1") of it to his only child Andrew ("the son") retaining the remainder ("Yard 2"). The plan at that stage seems to have been that the son would thereafter develop the whole of the yard for the purpose of a waste transfer business to be carried on by a company to be owned 75 per cent by the son and 25 per cent by the father. An important issue is .as to what security the son and/or the company was to have in Yard 2, and what rights the father was to have to conduct a business on his own account in Yard 2. The son, with some assistance from the father, carried out the necessary development. A company, Ash Waste Limited ("Ash Waste") was incorporated, its shares being issued 75% to the son and 25% to the company. It commenced to trade. Then the father and the son fell out. The father was excluded from the yard, and thereafter took various steps designed to force the· company out of business. Attempts to resolve matters by agreement between the father and the son failed. Eventually two friends of the son, a Mr Horton and Mr Ketcher, proposed to the son that they should buyout the father's interest in Yard 2 and go into business with the son by acquiring a two thirds interest in Ash Waste. That deal was agreed, at least in principle, by the son. However, before it was fully implemented, the son fell out·with Horton and Ketcher. In the meantime the son had registered a caution against the father's title to Yard 2, and Horton and Ketcher had reached an agreement with the father (later implemented by a transfer) for "the purchase from him of Yard 2. As part of the ultimately aborted deal with Horton and Ketcher the son had agreed with them that he would remove this caution. When that deal aborted he refused to do so.
2. That bare outline is sufficient to introduce the various claims which. I have tried. They consist of:

i) A claim by Horton and Ketcher as transferees of Yard 2 that they are entitled to be registered as proprietors free from the rights sought to be protected by the son's caution;

ii) A claim by Horton and Ketcher that the deal reached between them and the

son amounted to a binding contract for a joint venture, and for damages for its breach by the son ("the Joint Venture claim");

iii) A claim by the son against both the father and Horton and Ketcher that he is

entitled by a proprietary estoppel to sole legal and beneficial ownership of Yard 2, alternatively that he and/or Ash Waste are entitled by a proprietary estoppel to some other arrangement providing them with security of tenure of Yard 2;

iv) A petition·by the son claiming relief against the father in respect of Ash Waste, and the father's shareholding therein, under section 459of the Companies Act 1980.

3. In essence these all boil down to three issues:

i) Can either the son or Ash Waste establish any rights to Yard 2 by way of proprietary estoppel against the father and if so what rights?

ii) Is the son's caution maintainable against Messrs Horton and Ketcher?

iii) Do Messrs. Horton and Ketcher establish the Joint Venture Claim?

Relationships

4. Because of the parties' aversion to recording their agreements with any degree of formality and a preference (in the case at least of the father) for conducting his financial dealings' in cash, arriving at the truth in this case depends on being able to construct a satisfactory chronology. Before trying to do that, it is appropriate to say something about the principal, and other, characters in the case, and about the historical occupation of the yard.

i) The father was born in 1942 and was thus aged about 56 in 1998 when the events which have given rise to this claim were first set in train. He had previously used the yard for the purposes of an ambulance business (Metro Ambulances) which had ceased to trade in about 1995. From that time the yard had been fenced off, creating Yard 1 and Yard 2. Yard 2 had been let, or licensed, first to a parcels business called Orbital Transport, and later to a Mr Spencer and Mr Jones. The rear part of Yard 1 had by early 1998 come to be shared between the son (who ran a business called "ADB Transport Tipper Hire") and Messrs. Horton and Ketcher who also ran a heavy haulage business. The latter moved off In about August 1998. The front part of Yard 1 was occupied by a Mr Clark together with a parcel to the eastofthe yard (also then owned by the father but later transferred to Mr Clark) for the purposes of a scrap business. Some Metro Ambulances vehicles remained on parts of the yard throughout. By this time what remained of the Metro Ambulances fleet had been incorporated into a company (owned' by the father) called Newtown Logistics Ltd. The father also ran, in partnership with his common law wife, Maureen, a portfolio of some 15 investment properties under the trading name ''Newtown Property Services".

ii) The son was born in about 1968 .and seems not to have settled to any secure or

sustained area of business or employment during his early adult life. He was the only child of parents whose relationship broke down when he was about 4 years old. He was brought up by his father. By 1998 he was married to his present wife, Hayley, who had a job with a building society. Hayley is Mr Ketcher's half sister.

iii) Until their relationship broke down, relations between the father and the son appear to have been marred only by tension between the love and concern naturally felt by a father towards his only son and his disappointment that the son had not made more of himself. In evidence this tension was apparent in the father's description in the witness box of himself as having "doted" on his son and the much angrier observations which he had ventured in hiswitness . statement (which, although not in the event tendered in evidence) had rehearsed a litany· of complaints against his son going back to his days of nursery school.

Representation

5. The trial took place over a period of five days, the first three in Birmingham on 7^tit, 8^tit and 9^th June 2005 and the last two in London on 2t^h and 28^tit June 2005. The son had been legally represented in the initial stages of the action but acted in person after 22^nd September 2004 and for the first three days of the trial. The father (by solicitors and Mr Stephen Whittaker of counsel), and Messrs. Horton and Ketcher (by solicitors and Mr Jeremy Callman of counsel) were legally represented throughout. The case was opened by the son on behalf of himself and Ash Waste and their, evidence (consisting of the son, Hayley and a Miss Smith) was completed during the course of the first three days. During that period four other witnesses were called, two brothers called Andrew and Steven Bird and a Mrs Mills on behalf of Horton and Ketcher, and a Mr Brennan on behalf of the father. By the time the trial resumed in London the son had obtained the services-of Mr Richard Colbey of counsel on his behalf. Mr Colbey had the disadvantage that he had no note of the oral evidence which had emerged in the course of the first three days, in particular of that given by the son and Hayley.

Chronology in relation to the proprietary estoppel claim

The period from March 1998 to the end of January 2000

6. The significant events during this period were:

i) The father's arrest on serious drug charges and his subsequent trial and, acquittal; and

ii) Steps taken by the son to obtain planning permission for use of the yard as a waste transfer station.

7. The father's arrest was in March 1998. Following that arrest the father spent six weeks in custody until he was released on bail, the son standing surety for him. Mr Spencer was arrested at the same time. The trial did not take place until October 1999 and was not conCluded until 21 st January 2000. The father and Mr Spencer were both acquitted.
8. From about September 1998 the son began to take steps, in conjunction with a planning consultant (Mr Andy Ambrose) with a view to obtaining planning permission and the necessary licences for the use of the yard as a waste transfer station. By the end of 1998 the son was in sole occupation of Yard 1, Messrs Horton and Ketcher having left in,August 1998 and Mr Clark having removed himself (as a result of threatened enforcement proceedings by the Council); The rates for Yard 1 were put into the son's name. On 12^tit October 1999 (just as'the criminal trial was opening) the· son submitted a planning application for permission to use the yard as a ,waste transfer station, apparently on the basis that he was the owner of both Yards 1 and 2. Planning consent was obtained on 14^tit January 2000.
9. The son's written evidence as to the background to the planning'application was that, in about August 1998, he had approached the father and Maureen with his idea fot a waste transfer station on the yard. He had canvassed the idea of his buying the yard off his father for that purpose but his father had rejected, that idea with some such words as "why do you want to b~y it off me son? It's all yours anyway". The father was at that time facing the prospect, if convicted, of being in prison for 12 to 15 years. The son had therefore proceeded with the project with Mr Ambrose's assistance.
10. In his oral evidence under cross-examination the son was much less certain about the date and content of the discussions with his father. As to dates he became confused as to whether the conversation had been before, during, or after the trial, eventually settling for the proposition that there had been relevant discussions on the same lines before, during and after the trial. The general terms of the conversation was "It's only you and me son", the son taking this as a reference to the fact that as his father's only child he was going to acquire the yard in due course.
11. The father's written evidence did not deal directly with the conversations alleged by the son to have taken place, and sought to suggest that the planning application had taken place entirely behind his back and without his knowledge. In cross-examination . however he appeared to accept that he had known of the planning application, but had not known until much later that in making it the son had purported to do so as owner of the yard. He also came up with the recollection that "well into my case" he had volunteered to the son that the son could have Yard 1.
12. There seems to have been a hiatus in progressing the development of the waste transfer station during this period. It is common ground that by this time the father knew of the existence of the planning consent and the fact that its terms were such that the structure to be erected for the purposes of the waste transfer station would have to straddle Yards 1 and 2, th~ greater part of it being required to be in Yard 2. It is possible that the reason for the hiatus was that the recently acquitted Mr Spencer in fact remained in Yard 2 until about July 2000 when he moved to another yard in Mancetter found for him by the son. That was the son's evidence. It was not challenged in cross-examination and fits with the fact that no steps were taken to acquire the pre-fabricated steel framed structure until about June 2000.
13. By August 2000 the steel for the structure had been purchased and delivered to the site. The cost of the materials for the structure was £12,000. There is a dispute as to. how that was funded. The son says he borrowed £4,000 from Mr Brennan and the balance from his grandmother. The father agrees that £4,000 was lent by MrBrennan to the son but sayS that the balance also came from Mr Brennan out of the proce~ds of a £20,000 loan which Mr Brennan had made to the father. Mr Brennan gave evidence that he had lent £20,000 to the father on or about 6^th June 2000 on the understanding that the father was borrowing £8,000 of that to be used by the son to acquire the structure, the remaining £4,000 being advanced to the son by a cheque in August 2000. Mr Brennan has since received a repayment of the £8,000 from the ·father and £2,000 (in respect of the £4,000) from the son. In relation to this dispute I preferred the evidence of the father (corroborated by Mr Brennan) to that of the son.

September 2000 to August 2001

14. This, in many respects critical, period, begins with the father and son making contact with a firm of accoUntants in Solihull, Jerrom Associates .. The letters written by Jerrom Associates during this period can be allowed to tell the story. On 24^th November 2000 Richard Jerrom wrote to the father, saying that he had that day seen the son and Hayley in relation to the start up of the skip business and saying:

" ... I have pointed out to them that there is no point in them or I doing anything with the business plan until the following are sorted out.

1. The ownership of the shares and directors of Newtown Logistics Limited are confirmed ..

2. There is a proper lease in place and/or ownership· is transferred so that either Andrew and/or his company either own the yard or have security of tenure by way of a proper lease for a long period.

Without the above, no bank or finance company will be prepared to lend money for the development of the business.

Will you give these problems urgent consideration and contact me as soon as possible with your instructions.

P .S. Andrew has phoned and informed me that in return for' joint ownership you have 25% of the shares. Please confirm."

15. The postscript to that letter suggests that at that stage the idea was that the yard should be jointly owned by the father and the son. A letter from Mr Jerrom to the father dated 12^th December read:

"With regards to your previous correspondence and. your subsequent telephone conversation with my Manager Adrian . Harris, it seems to me that your reservations in respect of the ownership of the land can best be dealt with either by owning it jointly with your son Andrew with a proper lease between you, the Landlords, and the Company or to incorporate the land into the business in exchange for shares and retain rights over the land.

From my point of view, I would have thought that the first suggestion would be more beneficial b~t I would be obliged to know whether or not you have a solicitor with whom we can correspond on this matter, or would you prefer us to locate one on your behalf."

16. That letter speaks for itself. The father was slow to respond. Following a chasing letter dated 19^th January 2001, the father wrote to Mr Jerrom on 23^rd February 2001 in the following terms:

"Thank you for your letters. I recently called to see Mr Peter Heath of Heath Martin & Co Solicitors Grosvenor House Grosvenor Road Coventry CVl 3FZ phone number. 02476 229549.

I have left with him the freehold Land Registry deeds to the land at Pool Road. You may wish to assist Peter Heath in finding the best way to raise £40-50,000 by using the deeds as collateral to help my son Andrew. I wish to keep control of the deeds in my name. My son Andrew is married to Hayley and they are at this time "madly in love" but as years go by that might change and I do not wish' my land and assets to be sold off under the Matrimonial Act.

If I can be of any further help in assisting my son in his quest please do not hesitate to contact me."

17. Thus at this stage the father appears to have been prepared to do everything he could to assist the son short of actually transferring ownership of the yard to the son. Moreover at this stage the father's only inhibition about the latter course lay in his apprehensions about the matrimonial position. The proposed business (" ... his quest") was being perceived by the father as very much the son's venture.
18. A letter from Mr Jerrom to Mr Heath dated 30^th March 2001 reads as follows:

"We have been informed by both David Brandish and his son Andrew, that David Brandish is gifting his son, one acre of land on the site at Pool Road. This is to be used by Andrew in his business of licensed transfer station for skip waste. Could you . please confirm to us that the matter is in hand as we urgently need to action commencement of his business."

This letter is ambiguous. The reference to "one acre of land" suggests a reference to the whole yard, whereas the description of it as being "on the site at Pool Road" suggests that only part of the yard was to be transferred. What is not in dispute is that what actually happened was that, by a transfer dated 11 th April 2001 Yard 1 alone was transferred by the father to the son. There is absolutely no doubt that the son understood that at that stage oruy Yard 1 had been transferred to him. He made no protest to the father that this was in some way in breach of some earlier assurance from the father that the whole yard would be· transferred to him. Indeed he told me that he felt grateful to the father for having transferred Yard 1. It gave him the ability to raise funds by mortgage to get the business going. He also told me that his understanding was that "If I did well I would get the other half' .

19. At this stage the understanding also seems to have been that the new business would be conducted by Newtown Logistics Ltd, with the son owning 75% and the father 25%. In the event Newtown Logistics Ltd turned out to be an unsatisfactory vehicle for this purpose (because of old county court judgments registered against it). Ash Waste was therefore incorporated (in July 2001) with 75% of the shares issued to the son, and 25% to the father.

August 1001 to January 2002

20. In August 2001 the son started work in earnest on developing the yard. This involved clearing approximately two' feet in depth of what the father described.as Stockingfo~d rock from the site, re-surfacing' the whole site, acquiring and positiomng the waste. tanks, and erecting the waste transfer station itself. It is clear that the father actively assisted the son in this process. The process seems to have been completed by about the end of January 2002, and plainly involved substantial expenditure. This was defrayed by the son largely from monies raised by him from Allied Irish Bank ("AIB") under a facility letter dated November 2001. The amount of the expenditure incurred by the son during this period on the development generally was some £36,000 although, as Mr Callman demonstrated, of that only some £17;695.25 was strictly attributable to building works and materials.

January 2002 to August 2003

21. It is unclear at exactly what point after this date Ash Waste commenced trading from the site, but it was probably from about February 2002. What rapidly emerged, however, was that the son and Hayley on the one hand and the father on the other hand had quite different ideas about what the nature of any mutual arrangement was. The son and Hayley proceeded on the basis that Ash Waste was to occupy the whole· yard and that the father would run a "small skip" business as an adjunct to Ash Waste's main waste transfer business. The father's understanding seems to have been that, in return for Ash Waste being entitled to use Yard 2, the father would have· a· 25% share in Ash Waste and be able to run a "small skip" busi_l1ess from Yard 2 on his own account under the name "AA Bins".
22. It seems to me possible that, in the enthusiasm both displayed to get the development completed and Ash Waste's new transfer business under way, this represented a genuine misunderstanding between father and son arising from a failure by each to spell out exactly to the other his understanding and intention. Both had simply assumed that all would be well betWeen them in the future.
23. That, however, was not to be. Hayley, who had by this time given up her job with the building society and was working for Ash Waste, found the constant presence of the father and his friends at the yard irksome. Matters came to a head between her and the father on 23^rd May 2002 over an incident which both father and son agreed in their evidence was trivial in itself. The father had taken some trellis work from one of Ash Waste's skips and given it to Mr Brennan. He had no right to do so. An important part of the waste transfer business lies in the separation of salvageable and recyclable material from the skips. Words were exchanged between Hayley and the father. The nature of the subsequent deterioration of relations between the father and the. son is best conveyed by a letter written by the father to the son some weeks later on 19^th July, which read in material part:

"Seven weeks ago I apologised to your good lady wife. Later I called round to· see you so that we could have a talk before things got out of hand. You spoke down to me in a threatening manner from your skip lorry and told me to fuck off, get fucked - I took you at your word.

All this hassle over some scrap trellis and because I asked your . wife why she spoke to me in a sneery manner. There must be something else deep rooted that I do not know about that made you so angry towards me. You had the power to defuse the situation within 24 hours - all you had to do was call round and apologise to me but instead you put my skips on the road, you defaced the skips with spray paint, you stopped me tipping my skips, you changed the locks, asked for keys off Tony to be returned, bent my AA Binns stencil in half and much more. This is no way to treat your father - your wife would not speak to her mother that way showing no respect.

You have gone back on your word. The deal was 25% of the business and all the 2-yard skip work for use of my 60%.land mass.

As your word is no longer any good I want any deal that you offer to be in writing.

My deal is that the land is not for sale at any price. Ii is part of my long term pension plan. I will grant a lease for five years or more (you decide) for a weekly rent that comes out of my 25% of the balance at the end of the year plus 2-yard skips to be re-instated as per original agreement, and not as mentioned in Richard Jerrom's letter dated 17 July ie I pay you to tip skips.

In other words I am not asking for 25% of the pocketed cash you receive"from skips that does not go through the books.

I have notified Richard Jerrom that I will no longer correspond or speak to him on the phone. We believe he is not neutral but biased towards you and yours.

TODAY SAT 20^TH JULY 2002

ANDREW I HAVE BEEN READY TO TALK/NEGOTIATE FOR SOME TIME NOW ALL YOU HAVE TO DO IS RING ME OR CALL ROUND WE CAN SORT THINGS OUT BUT FIRST GET MARK BURNS OFF MY LAND AND CLEAN THE HARDCORE UP/AND OFF AS A SIGN OF GOOD FAITH

HOPE YOU AND YOURS ARE KEEPING WELL

DAD"

24. The father, now effectively excluded from Yard 2, sought to strengthen his· negotiating hand by writing both to the Environment Agency and to the planning authority pointing out that he owned Yard 2 and that Ash Waste- had no right to occupy it unless he were to grant it a lease. Eventually solicitors were instructed (Messrs Sydney Mitchell for the son and Blakemores for the father). A letter from the former dated 28^th October 2002 asserted that there had been an agreement in 1998 that the whole yard would be transferred to the son, the transfer of Yard 1 having been in part performance of that agreement. By 27^th November 2002 father and son appeared to have resolved their diif.erences. According to a letter dated 27^th November 2002 from Blakemores to Sydney Mitchell the essence of the agreement was that:

i) the ownership of Yards 1 and 2 should remain in the separate names of the son and the father;

ii) the father would grant Ash Waste a lease of Yard 2 at an initial rental of £100 per week;

iii) the father would be able to run his small skip business and for that purpose to tip free of charge. If he was prevented from using, or ceased to use, that facility the rent would rise to £300.00 per week.

iv) the father would retain a 25% share holding in Ash Waste. Blakemores suggested that there be a shareholders' agreement to protect the father's position.

25. No reply was ever received to that letter but the father seems to have assumed that all was agreed in principle, as indeed it seems to have been. He therefore wrote to the Environment Agency telling it that he had now agreed to give the' son permission to use Yard 2, and urging it now to "rush" the licence through before Christmas 2002. In fact the Environment Agency turned out to require a bond for £13,616 in respect of "clean-up costs". This was .provided by AIB, on behalf of Ash Waste, supported by a guarantee (secured on Yard 2) by the father.
26. Once the ' waste licence had been issued (on 18^th February 2003) the father and the son fell out again. The "agreed" rental of £ 1 00 per week had not been paid. The father therefore gave notice to AIB terminating his liability under his guarantee to AIB in respect of the bond as from 3^rd July 2003. 'This appears to have alerted AIB to the unusual and unsatisfactory nature of the security which they had over Yard 1 in respect of their lending to the son. On 25^th April 2003 they called in the loans against Ash Waste (£13,616) and the son (£76,623.84).
27. A letter from Mr Jerrom to Andrew dated 29^th April 2003 sought to explain to him his predicament and a way out of it in the following terms:

"As you are aware yesterday I spoke to the Allied Irish Bank as I was actually in the bank on other business. From what I can ascertain from speaking to your father, essentially the problem is that your father has pointed out to them that he owns a, proportion of the land and wishes to have his guarantee in respect of that, and also his personal guarantee in cash terms in respect of the Health & Safety Bond withdrawn.

I do not think that the Allied Irish Bank were aware that he personally owns the other half of the site and probably, as the AIB and your father use the same Solicitor, this has gone unnoticed. They are therefore relying on your valuation of the land against both the Bond, the Current Account and the Loan Account balances which they in their wisdom do not think is covered by the valuation of Y0,UI' half of the land.

I have today spoken to your father David, in order to find out his side of the problem and to be fair to him, he does consider that the AIB's surveyor/valuer was probably not up to speed with the valuation of the properties in your area, especially your site with the planning permission for a waste transfer station.

Your father considers that your part of the site is probably worth £200,000 based on the sale of the scrap yard next door to you. If you are in agreement with this sentiment, then I can approach AIB to send an independent valuer to the site to· reassess and re-value your part, which may give them sufficient comfort to allow the trade to carryon. Whatever happens, you should be aware that I have requested AIB not to take any further action until I have had the time to sort out your respective problems.

The essence of the conversation with your father today, has been as it has always been. The fact that whenever you see him or talk to him, either singularly or together with Hayley, you are always confrontational to him. I have to say that when I speak to him, he is always courteous and respectful to me and he always asks that I try to sort out your problems.

With that in mind, I ask you once again to reconsider your· position in respect of the following:-

1. The most important point in all this, which seems to have gone unnoticed is that he has given you your part of the site.

2. He has pledged the other part of the site to the Allied Irish Bank.

3. He has undertaken to guarantee the Bond.

4. Both you and he will be considerable losers if the Allied Irish Bank exercise its rights to Sue the company for monies loaned which would cause the Winding up of the company.

Trying to look at it from an independent point of view. I have to. say that in my opinion, if you cannot reconcile with each other immediately, then perhaps it may happen over time, but in recompense for what your father has already done in respect of Ash Waste, forgetting the letters already sent from him to the AIB and in respect of the application for an Operators Licence, I do. consider that he is entitled to a rent of his part of the site.

You may not' like what I am suggesting, but I am trying to be judgemental in this matter and therefore I seriously suggest that you and Hayley should reconsider, and the company pay your father £ 1 00 per. week rent in respect of this site. If. you try to reconcile your differences in these circumstances I think that business would go from strength to strength. I also suggest that you request the AIB to re-value the site with the view to releasing your father from his liability, but even so, he is still entitled to rent as I have always suggested to you.

Under these circumstances your father would be happy and he could help you in the yard or he could leave things as they are; I seriously suggest that you reconsider my letter as yoUr father is prepared to try and reconcile your differences based on the contents, and. there is no more I can do to help you if you are not receptive to my suggestions. "

28. That letter evidences the fact that it was the son's refusal to pay the father £100.00 for the use of Yard 2 which was the cause of the latest outbreak of hostility on the part of the father. It is also evidence of the fact that Mr Jerrom had from the outset been of the view that the mutual ~greement between father and son entitled the former to seek a rent for the use by the son of Yard 2.
29. Nothing came of Mr Jerrom's attempt to persuade the son to consider paying rent.

Relations between"the father and the son remained unresolved. On 22^nd July 2003 the father employed bailiffs to levy distress on Ash Waste in respect of £2,857 allegedly owed as rent. The distraint was unsuccessful.· That night the father's depot at 4A Pool Road was burnt down in an arson attack. He believed that the son was responsible but the police seem not to have found grounds for that belief. The father continued with steps to persuade the Environment Agency to withdraw the Waste Management Licence.

30. On 9^th September 2003 the son and Ash Waste applied to register the caution. The nature of the cautioners' interest was described as follows:

"Andrew Brandish is a Director of and principal share holder of Ash Waste Limited t/a Atherstone Skip Hire. Andrew Brandish owns adjoining land to that over which the caution is sought. That land, together with the land over which the caution is sought is used by Ash Waste Limited t/a Atherstone Skip Hire in connection with its business. The owner of the land over which the caution is sought, Lionel Brandish js Andrew Brandish's father. He allowed Andrew Brandish and .his company Ash Waste Limited t/a Atherstone Skip Hire into occupation of that land and further allowed the said Andrew Brandi&h and his company Ash Waste Limited t/a Atherstone Skip Hire to develop both his own land and that over which the caution is sought for the purposes of his business. It is Andrew Brandish's case that he and/or his company Ash Waste Limited trading as Atherstone Skip Hire have therefore acquired an equitable interest in the land over which the caution is sought by way of either proprietary estoppel and/or promissory estoppel. It IS believed that Lionel Brandish, the owner of the .. land over which the caution is sought, may now be seeking to, sell the land over which. the caution is sought notwithstanding firstly the interests in it of Andrew Brandish and his company Ash Waste Limited trading as Atherstone Skip Hire and secondly the fact that he cannot give vacant possession of the said land"

31. By this time Ash Waste and the son were in financial trouble. Ash Waste does not appear to have traded successfully. The son said in evidence that the business was "bobbing along", but Ash Waste's draft accounts for the period suggest that to have been an optimistic description. Messrs Horton and Ketcher, who now come on to the scene, told me that their understanding was that the son by this time was "facing the decision to close down the business. Given that AIB had called in the loans and the son had no realisable assets apart from Yard I, this seems likely to have been the case.

Issues relevant to the proprietary estoppel claim

32. Contrary to the impression which the father sought to give in his evidence I find that the father did make statements to the son in 1998 and 1999 which encouraged him to believe that he would be able to take over the yard. The father was understandably pre-occupied with the legal difficulties in which the found himself as a result oithe serious criminal charges which he faced. The evidence against him was not so flimsy that there cannot have been times when he thought that there was a real possibility that he would be out of circulation for a considerable period .. There is no evidence that he or: Maureen were in any way reliant on the income produced by the yard. He plainly knew of, and as I find encouraged, the son's retainer of Mr Ambrose and the subsequent application for planning permission. He was content, as late as February 2001, to allow the whole of the yard to be used as security for the son's proposed business at the yard. Although this represented a retreat from what I think may well have been a more generous indication given during the course of the criminal proceedings, it is not inconsistent with such an indication'having been given.
33. I do not, however, find that the assurances given by the father in 1998 and 1999 were sufficiently definite as to justify the son in claiming in, say, early 2001, that the father had committed himself to make over the yard to the son. It is striking that no such picture was presented to Jerrom Associates in the autumn of 2000. The picture which one gets from· tIiat period is of a much more fluid understanding. If the father and the son had fallen out at that stage it is difficult to see how the son could have advanced any claim to a transfer of the yard by way of proprietary estoppel. 'Even had the assurances given by 'the father been unequivocal the maximum' equity to which he could have reasonably laid claim would have been limited to the extent to which the obtaining of the planning permission had enhanced the value of the yard.'
34. Any such claim was, in my judgment, satisfied by the transfer by the father to the son of Yard 1. That was gratefully accepted by the son. It is not suggested by the son that after that date the father gave any assurances that that transfer would be followed in the near future by a transfer of yard 2. The highest the son put·it in his evidence was where he said that his understanding was that "if I did well, then I'd get the other half'. Until the father m~e some decision to that effect, the plain fact was thatthe fat~er was retaining Yard 2 in his ownership.
35. When the son then proceeded to develop the yard he did so with the full·encouragement of the father but in the knowledge, that the father continued to retain Yard 2 and had made no promise to transfer it to the son. I find it useful to ask what would have been the position had the father, when the development was complete, then purported to assert his legal rights over Yard 2 by excluding the son from it altogether. Such an action would undoubtedly have been inconsistent with the understanding on the faith of which the son had expended labour and money in developing the yard. But exactly what was that understanding? It clearly included a shared understanding that the son and/or Ash Waste would be entitled to use the yard as a whole, and the new building, for the purpose of its proposed business. There was also a shared understanding that the father would be entitled to 25% of the business. The misunderstanding, if it was such, was as to what further direct financial benefit the father was to have from the arrangements.
36. Had the father insisted on his apparent rights at the time I have postulated, the son and/or Ash Waste would in my judgment have had a good claim against the father based on a proprietary estoppel arising out of the expenditure on the development. The equity so arising might have been satisfied in a number of ways. The "minimum equity" would have been to award the son a lien on Yard 2 to recoup expenditure which he could show had either been referable to Yard 2 or which would not have been made had the father's intentions been clear from the outset. Alternatively the remedy might have been by reference to the improved value of Yard 2. A further possibility would have been to grant the son and/or Ash Waste sufficient occupational rights over Yard 2 to enable Ash Waste to trade from Yard 2.
37. Had the last solution been adopte4, a court would have been faced with the question of whether Ash Waste should have to pay anything to the father in respect.of its occupation. To decide that question fairly it would have been necessary to resolve in some way what I have described as the misunderstanding as to what financial or other benefit (if any) the father was to get from his ownership of Yard 2. On that question I . prefer the evidence of the father to that of the son. The father was legitimately expecting to be able to exploit his ownership of Yard 2 by carrying on his own mini· skip business and using the facilities of the waste transfer station free of charge in the· process. That was what he in fact commenced to do as soon as the developed site became operatio~. It seems to have excited no immediate protest from the son. I infer that this was indeed the deal. What caused the falling out was not the father's use of the yard for his own business but the relatively trivial incident in relation· to the trellis in the Ash Waste skip. This led to the son excluding the father from the yard altogether, an action which (as I find) was incompatible with the understanding which had previously existed between them.
38. If that action by the son did not by itself have the effect of disentitling him from asserting an equity based on his expenditure on the development, his subsequent conduct did. The father and the son were able to resolve their differences by reaching the agreement set out in Blakemores' letter dated 27^th November 2002. That agreement was one which, in my judgment, adequately reflected any equity which the son and/or Ash Waste could then assert. But, as soon as the father's co-operation over the waste management licence had thus been secured, .the son reneged on the agreement to pay'the father £100.00 a week. The son claimed in the witness box that he had done so because the father insisted on being paid in cash. That he did so insist is entirely plausible, but I do not believe. that this was why the, money was not paid.The son simply thought he could get away with not honouring the agreement. This was a catastrophic misjudgement on his part.
39. Accordingly I have concluded that any equity which the son and/or Ash Waste may at one time have been entitled to claim ~ad been exhausted by the time they came to register the caution. I would therefore dismiss their Part 20 claim against the father (and Messrs Horton and Ketcher) in respect of Yard 2.

The Joint Venture Claim

40. There is only a limited area of factual" dispute about this claim. Messrs Horton and Ketcher and the son all knew each other of old. When, in the early autumn of 2003, Messrs Horton and Ketcher heard that the son was thiDking of packing in the business, they put a proposal to him that they would buyout the father's interest in Yard 2 and then all three go into business together. in the yard. Their perception was that the real problem with the business was, apart from the unresolved land dispute, that the mechanical equipment being used by Ash Waste was not adequate. They proposed to inject additional resources into the business to make good this deficiency. They were in a position to do so because Ketcher's company Midland Plant & Haulage Ltd (of which Horton had become a director following his discharge from . bankruptcy in June 2002) enjoyed a sufficiently favourable credit status to enter into the relevant hire purchase contracts ..
41. The son reacted favourably to these proposals. Horton and Ketcher then negotiated with the father for the acquisition of Yard 2. The father was looking for up to £170,000. He also wanted back the tools and equipment which had been detained by the son at the yard since May in the previous year. After further consultation with the son, Horton and Ketcher offered the father £160,000 for Yard 2. The father agreed to this, subject to Horton and Ketcher being able to raise and pay £60,000 of the price in cash as a confirmation of their intention to proceed.
42. There is some dispute as to whether all this happened in September or in October of 2003. Horton and Ketcher say that it was the former, and that the application to register the caution was all part of this process. It was, on their account, a manoeuvre agreed upon hi order to prevent the 'father from being able to sell elsewhere. The son was less clear about the function of the cautipn, believing in retrospect that he had registered it at the request of AIB and as a means to pacify that bank. It is not necessary to resolve this question. It is possible that there is an element :of truth in both accounts, the initial trigger for the caution being the son's desire to pacify Am and its registration in fact serving the useful purpose of aiding Horton and Ketcher in their negotiations with the father. Whatever the true position it was obviously a fundamental assumption of the agreement between the son and Horton and Ketcher that the caution would be removed when their purchase from the father completed.
43. During the course of October 2003 matters progressed smoothly. Horton and Ketcher began to work in the yard in the business of Ash Waste. Orders were placed for new machinery for the business by Midlands Haulage and Plant Limited. :Horton and Ketcher were able to raise the £60,000 cash by a mortgage of property in Ketcher's name in which Horton (now discharged from bankruptcy) seems to have had some· sort of interest. The parties, with Hayley's assistance, produced letters for signature by the father. By one letter the father was to agree to return his 25 shares in Ash Waste. By another he was to confirm the sale to Horton and Ketcher. Two other letters written on Ash Waste notepaper (but not signed by the son) told the father, first, that on receipt of the signed letters the son would return the father's tools and equipment and, secondly, that on receipt of a signed copy the son would agree to have the caution on Yard 2 removed to allow the sale of Yard 2 to proceed. The son told me in his oral evidence that all this had been done behind his. back. I reject that evidence ..
44. The reason for this piece of evidence from the son is that his case was that he had made no final agreement with Horton and Ketcher; that, while he had agreed in principle to a joint venture with them, he had tried to make it cleat that final agreement depended on the production of a written agreement to be . prepared by lawyers; but that Horton and Ketcher had simply steam-rollered ahead without regard to his concerns. He was therefore anxious to distance himself from any evidence which suggested (as the typed letters did) that the three oftbem were in absolute (and final) accord as to the way forward.
45. There is in my judgment no doubt that the following matters had been agreed between the parties:

i) Horton and Ketcher would buyout the father for £160,000, the caution would be. released. for that purpose, and the father's tools and equipment would be . returned to him;

ii) Two thirds of the shares in Ash Waste would be transferred to Horton and Ketcher, who would become co-directors with the son, and Ash Waste would continue in business at the yard.

46. These elements of the agreement were clear enough. What seems not to have been clearly agreed were:

i) how was the yard was to be held in connection with the joint venture?· In evidence the son told me that he thought the idea was that the yard as a whole would be held in third shares. Horton and Ketcher said in their oral evidence (the written evidence is opaque on the point) that the thinking was that the son would continue to own Yard 1 and that they would own Yard 2. At first sight, this represents· a concession by the son, since it involves him in ceding 40% of the area of yard in exchange for a one third share in 100%: It is not difficult to see, however, why in the light of subsequent events Horton and Ketcher have insisted that they were to retain separate ownership of Yard 2;

ii) how was the. mortgage of Yard I in favour of AIB was to be accounted for? Was it to remain the sole liability of the son? Was it to be treated as a liability of Ash Waste? If the former, was the son to be entitled to anoccupation rent from Ash Waste to enable him to pay the interest? There is no evidence that any of this was discussed

iii) If Yard I and Yard' 2 were to remain in separate ownership but occupied 'by Ash Waste, what were the terms of such occupation to be? Was each owner obliged to allow Ash Waste to occupy his or their position, and if so for how long and on what terms?

47. These questions cried out to be addressed, but were not. According to the son he arranged a meeting with solicitors on 20^th November 2003 at which he hoped that Horton and Ketcher would be present. They did not attend. It would· appear from all accounts that by this time relationships in the yard were in any event becoming strained for a variety of reasons. On his return from visiting the solicitors the son saw Horton and Ketcher in apparently deep conversation with the father. Their vehicles were parked next to each other in the road near Ketcher's house. The son immediately suspected a conspiracy against him. "He boiied over. Driving up alongside he hurled a tirade of abuse at the three supposed conspirators, and spat in his father's face (in evidence the son denied that this escape of saliva had been deliberate). He denounced the deal between.himself and Horton and Ketcher. Then he drove off.
48. Horton and Ketcher followed him to the yard and met him in the office there. Their· conversation with the father had been entirely innocent of any plot against the son. The son could not be persuaded of this. A physical melee took place. Hayley says that it was caused by Horton flying at her and then at the son. Horton and Ketcher blamed the son. Various employees came on the scene (Andrew Gray, Colin Powell, Andrew Bird and Steven Bird). I heard only from the two Bird brothers. Neither had seen who started the fight, but together they were able to break it up.
49. Horton and Ketcher then left the yard taking with them the skips which Midland Haulage and Plant Ltd had purchased for the Ash Waste business. For.a month they remained off site altogether, maki~g a number of overtures to the son with a view to their either buying him out or vice versa. Nothing came of this ..
50. Horton and Ketcher then moved equipment back on to Yard 2, but the son continued to occupy and use that part of the waste transfer station which was in Yard 2. On 19^th March 2004 they entered into a written contract, with the father executing a simultaneous transfer, for the purchase of Yard 2. The £60,000 cash had been paid to the father back in October 2003. The contract and transfer both stated the purchase price to be £100,000.
51. In August 2004 Horton and Ketcher Were able to secure possession of the whole of Yard 2 and thereafter to operate a business effectively from it. Yard 2 did not, however, enjoy either planning permission or a licence to use it as a waste transfer station. It was not until the turn of the year that they were able to obtain the necessary permission and licence.
52. In their amended Particulars of Claim, Horton and Ketcher's monetary claims against the son are put under the following heads:

i) mesne profits;

ii) damages for wrongful registration of the caution pursuant to section 56(3) of the Land Registration Act 1925 (paragraph 17 of the amended particulars of claim);

iii) damages in respect of the son's refusal to vacate Yard 2 until August 2004 (paragraphs 17 and 19 ibid.). and their inability to operate a profitable businessfrom Yard 2 until they had obtained the necessary permissions in December 2004;

iv) damages referable to their expenditure pursuant to the joint venture agreement (paragraph 18 ibid.).

53. The last of these claims can be quickly disposed of and, indeed, was not pressed by Mr Callman in his closing submissions. All the pleaded expenditure was in fact expenditure not by Horton and Ketcher blit by Midland Haulage and Plant Ltd which was not a party to the proceedings (and which has since gone into liquidation). Its only relevance therefore is as evidence from which the existence of a joint venture agreement can be inferred.
54. The problematic claim is the claim based on the delay which they experienced in being able to commence their own fully licensed business from Yard 2. This was put as a claim for damages for breach of the joint venture agreement. The argument was that, had the son not wrongfully terminated the joint venture agreement, they would have been able to earn profits from a waste transfer business, with the benefit of all appropriate permissions, from 20^th November 2003 and throughout the whole of2004.
55. The argument depends, first, on establishing that there was a . fully concluded joint venture agreement containing all relevant terms, and, secondly, on establishing what their position would have been had the son not repudiated that agreement. I have already indicated the respects in which the agreement which was reached with the son failed to deal expressly with. a number of matters which appear to me to have been necessary to be agreed before it could be said that there was an enforceable agreement between the parties. Chief amongst these were the terms on which Ash Waste was to oc~upy· Yards 1 and 2. Without agreement on that point I do not think that there was an enforceable agreement for a joint venture. The gap cannot, in my judgment, be filled by an implied term. None was pleaded, and it is far from obvious what any such term might be.
56. Even if that is wrong, the lack of agreement on this crucial point, is fatal to the claim for damages which is made. Had the agreement which was reached been implemented Horton and Ketcher would have become majority shareholders in Ash Waste. But Ash Waste would only have. continued to trade fromYard 1 so long as the son permitted it to do so. Had he prevented it from doing so it would not have been able to run the waste transfer business from Yard 2 until it had obtained the necessary permission and licence. There was no evidence that this would have been any more achievable at the insistence of the excluded Ash Waste than it was in fact at. the insistence of Horton and Ketcher.
57. Accordingly, I do not consider that Horton and Ketcher are entitled to damages against the son for breach of the joint venture agreement. They are, however, prima facie entitled to mesne profits in respect of the son's use of Yard 2 from 19^th March 2004 to August 2004.

Miscellaneous

58. My conclusion that the son had no claim against the father, which ·~as capable: of being protected by the caution, prima facie entitles Horton and Ketcher to the order they seek for the removal of the caution. Mr Colbey however submitted that the court should not grant them that relief on the ground of illegality. The illegality relied on was the insertion in both the contract and the· transfer dated 19^th March 2004 of the incorrect price of £ 100,000. This point had not been the subject of any pleading. Mr Colbey's submission was that that the insertion of the incorrect price had been done in the course of a conspiracy to cheat the public revenue, "being designed to evade stamp duty otherwise payable on the transfer and/or to evade capital gains tax otherwise payable by the father on his disposal of Yard 2.
59. In his witness statement dated 31^st May 2005 Mr Horton had explained the insertion of an incorrect price as being the result of a mistake by the conveyancing· solicitors who had acted which had since been corrected, or was In the course" of being so corrected. I am sceptical about that, since it is not obvious why those solicitors should have been given the incorrect information in the first place. On the other hand it is not impossible that a mistake was made of an innocent nature: all that the parties needed the solicitors to do was to arrange a simultaneous contract and completion of a sale on which £100,000 was to pass between the parties. A combination of a failure on the part of the parties to' give full information to the solicitors, and on the part of the solicitors to ask the right questions, could have led to the result without there necessarily having been any bad motive on the part of the parties. A tax evasion motive on Horton and Ketcher's part seems relatively unlikely: the device would have saved them a modest amount of stamp duty at the expense of a larger capital gains tax bill in the future.
60. Given the unpleaded character of the allegation, I do not think it right to draw the adverse inference from the bare facts which Mr Colbey urged upon me. It is therefore unnecessary for me to consider the issues of law which this submission raised and which were the subject of a round of written submissions after the close of argument.
61. Accordingly Horton and Ketcher are in my judgment entitled to an order that the caution is removed.
62. It remains only to deal with the section 459 petition. By that petition the son, who has at all material times been a 75% shareholder in Ash Waste, and its sole director, alleges that the father's actions in relation to Ash Waste amount to a conduct of that company's affairs which has been unfairly prejudicial to the interests of the son as the shareholder. The short answer to this claim is that the acts of the father which are "complained of were not acts in the conduct of the company's affairs. They were acts performed by the father in the assertion, as against the company, of rights cl~med by him as the owner of Yard 2. The son has been in complete control of the company throughout. The petition accordingly seems to me to be simply misconceived, and should be dismissed.