England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		HC07C00123 Royal Courts of Justice Strand, London, WC2A 2LL
		19/02/2008

Mr Justice Briggs :

INTRODUCTION – THE ISSUES

1. Robert Edward Hopper ("Mr Hopper") died suddenly on 3^rd December 2003, leaving his widow June ("Mrs Hopper"), three sons, Robert, Philip and Paul, and a daughter Carol. By his will dated 28^th April 1977 he left his estate to his wife (should she survive him for 28 days) and in default to his four children equally. Mrs Hopper did survive him for the requisite period, and in due course became his sole personal representative.
2. From modest beginnings as the proprietor of a fruit and vegetable business in High Wycombe, Mr Hopper developed a successful fruit and vegetable wholesale business known as RE Hopper in the Western Market in Southall, Middlesex during the 1970s and 80s. The profits of that business enabled the family (there are issues as to precisely which members of it) to purchase a 39 acre farm known as Sheephouse Farm, Shiplake, Henley-on-Thames, Oxon in 1976, and to augment it by a 14 acre L-shaped strip on its eastern and southern sides in 1982. The farm was further augmented by the acquisition in 1984 of land on the opposite side of the A4155 known (because of the use to which it was put) as "the Christmas Tree Land". I shall refer to the land successively purchased in 1976, 1982 and 1984 as plots A, B and C respectively.
3. By 1985 Mr Hopper and his family were running a fruit and vegetable wholesale business at the Western Market, and a market gardening business together with a farm shop at the farm, augmented by the sale of Christmas trees grown on plot C and a small part of plot A. Both the market and the farm businesses were by then established as separate partnerships at will. The partners in each of them were Mr and Mrs Hopper, Robert and his wife Lyn, with each partner being entitled to 25% of the profits of each business. There was substantial mutual trading between the market and farm partnerships. The market business purchased vegetables from the farm business. The farm business purchased fruit and vegetables (not available on the farm itself) for retail sale in the farm shop. Some of the mutual trading took place by way of simple exchange. By 1985 Robert (the oldest son) was 30, whereas Carol was only 13. At that time there was no residential accommodation on the farm.
4. By December 2003, to cut short a long story which I will in due course have to describe in some detail, Robert had for some fourteen years been the sole active manager of the business of the market partnership. For the same period, Mr Hopper with his wife's assistance ran the business of the farm partnership, including the farm shop. Since leaving college in 1991, Carol had established two businesses on a substantial part of plots A and B, both connected with, and arising out of her childhood love of, horses. The first in time was called "Cinderella's Magic Carriage" and consisted of the provision of a horse-drawn carriage for weddings. The second, called "the Sheephouse Stud" provided stabling, livery, training and grazing for horses. Soon after leaving college, Carol converted part of the farm buildings into a bed-sit for herself. She married her husband Richard Starkey in 1997, and by 2003 Carol and Richard were in the process of building a substantial house for themselves at the northern end of plot A, with money provided to them by means of a bank loan, repayment of which was secured on Mr and Mrs Hopper's home, rather than upon the farm.
5. As the result of tax planning advice from the family's solicitors and accountants plot A had by 1981 been vested in the joint names of Mr and Mrs Hopper and Robert, pursuant to a declaration of trust which declared the beneficial ownership as to half to the parents and half to Robert. Plot B was upon its acquisition vested in Robert's sole name, legally and beneficially. Plot C was acquired in Mr and Mrs Hopper's name, but it became common ground by the beginning of the trial that, by the time of Mr Hopper's death, it was, beneficially, an asset of the farm partnership.
6. The differing fortunes of the family businesses to which I have referred, during the twelve or so years before Mr Hopper's death, may be summarised as follows. The market business was consistently profitable, and generated the main source of income for Mr and Mrs Hopper, Robert and Lyn. Since its accounts do not include an item for goodwill, it is difficult to be sure whether during that period it acquired a substantially increased capital value, but since its day to day fortunes depended throughout upon Robert's hard work and business acumen, this seems unlikely.
7. By contrast, neither the farm business nor Carol's equestrian businesses appeared to have generated significant profits. Nonetheless, rising land values, coupled with the effect of improvements carried out on plots A and B (including but not limited to the erection of Carol's house) led to a substantial increase in the capital value of the farm. Undisputed expert evidence shows that by March 2007 plots A and B were worth, in aggregate, £2 million, and £1.265 million without the benefit of the improvements.
8. The evidence relating to the period until Mr Hopper's death shows a family living and working in reasonable harmony in the exploitation of the businesses and assets which I have described. Mr Hopper pursued his vocation, with his wife's assistance, as a farmer. Robert pursued a profitable career as a market trader. Carol realised her ambition to spend her life working with horses. Mr Hopper's sudden death prevented him from putting his affairs in order and, deprived of his leadership, the relations between Mrs Hopper, Robert, Lyn and Carol rapidly deteriorated into the state of dispute which the present proceedings have been instituted to resolve.
9. The first main issue concerns the ownership and occupation of the farm. It comes before me in the form of a claim by Robert for possession of plots A and B, and for a sale of plot A under section 14 of the Trusts of Land and Appointment of Trustees Act 1996, issued on 2^nd August 2006 against Mrs Hopper and Carol. By their defence and counterclaim (now amended) they claim a declaration that Carol is the sole beneficial owner of plots A and B. As the first alternative, they seek an order permitting Carol to purchase any beneficial interest of Robert in plots A and B, disregarding the value of any of Carol's improvements. Alternatively Carol claims compensation for the value of the improvements. Finally, though without any enthusiasm, Carol claims to be a tenant of the farm within the protection of the Agricultural Holdings Act 1986. I shall refer to those proceedings as the possession action.
10. At the heart of the possession action lies Carol's claim to be entitled to the benefit of a proprietary estoppel binding her parents and Robert, and arising from assurances made to her primarily by her father, beginning in the late 1980s and continuing thereafter until his death, that she was the owner of the farm. Mrs Hopper has never challenged this claim. On the contrary, by a deed of variation of Mr Hopper's will, dated 16^th May 2005, she assigned his share of the farm (a 25% interest in plot A) to Carol, and has supported Carol's claims in the possession action throughout, and given evidence on her behalf. Mrs Hopper has also purported to transfer her own beneficial interest in plot A to Carol.
11. Against Robert, Carol claims that he both knew of and adopted Mr Hopper's assurances that she was the owner of the farm, so as to bind his beneficial interest in both plots A and B. She relies upon three specific instances of express adoption by Robert, and also upon his adoption of Mr Hopper's assurances by his conduct in standing by while she and her husband built a substantial house on part of plot A. Robert's pleaded case consists of a denial that he said or did (whether by action or inaction) anything to affect his beneficial interest in the farm with an equity in his sister's favour.
12. Besides the question whether Carol is entitled to the benefit of a proprietary estoppel as against the farm, there is the further issue as to how, consistent with the requirements of justice and proportionality, that estoppel should be satisfied. Although various intermediate solutions have been canvassed, the parties' primary contentions are as follows. Carol claims that nothing short of outright ownership of the whole of plots A and B would give proper effect to the assurances which she claims she received. Robert's case is that, if an estoppel of any kind is established, it has been sufficiently satisfied by the combination of his mother's variation of his father's will in Carol's favour, and by transfer to Carol of her own beneficial interest in plot A. In short, Robert's case is that as the prime movers in the creation of any proprietary estoppel, his parents ought to, and have in fact, satisfied it by conferring on Carol a half beneficial interest in plot A, without Carol needing or deserving any further assistance from him or from the court.
13. The second main issue before me relates to the market partnership. It is common ground that since Robert took over the management of the market business in about 1989, Mr and Mrs Hopper's actual takings from the business consisted of a weekly sum (£250 rising to £300), payment of mortgage instalments on their matrimonial home, payment of income tax in relation to their partnership profit shares, and other occasional lump sums, as and when requested. Since the market partnership was a partnership at will, it is common ground that it dissolved on Mr Hopper's death in December 2003. Thereafter the weekly payments continued at the same rate to Mrs Hopper, until the end of December 2004. As the result of inquiries of the partnership's accountants made by Mrs Hopper with Carol's assistance, Mrs Hopper now claims on her own behalf and as her late husband's personal representative both to reopen the market partnership's signed accounts with effect back to 1992, and to recover from Robert as manager of the business a substantial amount by way of un-drawn profits in an amount, according to her evidence, slightly less than £300,000 as at December 2005.
14. There are also issues as to the correct factual and legal analysis of the basis upon which the market business was continued after Mr Hopper's death. In short, Mrs Hopper claims that a new partnership was established by the parties' conduct in continuing rather than merely winding up that business. Robert claims that since December 2003 the market business has been continued as a necessary aspect of the winding up of the market partnership which dissolved upon his father's death, in circumstances where the family dispute has prevented the completion of that process.
15. The issues relating to the market partnership come before me by means of a claim form issued on 19^th January 2007 by Mrs Hopper against Robert and Lyn. By agreement between the parties, six issues were ordered to be tried as preliminary issues, at the same time as the trial of the possession action. It has since been agreed to be more convenient for one of those issues to be deferred. The issues which remain to be determined by me are as follows:

(1) Whether after dissolution of the Farm Partnership and the Market Partnership, a second Farm Partnership and a second Market Partnership were formed?

(2) Whether at any time Mr and Mrs Hopper ought to be treated as entitled to separate capital accounts in the Market Partnership or whether the partnership had a joint capital account?

(3) Whether in relation to any accounting year of the Market Partnership or the Second Market Partnership, Mr and Mrs Hopper are entitled to the balance of their 25% profit share or not?

(4) Is Mrs Hopper an "outgoing partner" of the Market Partnership within the meaning of section 42(1) of the Partnership Act 1890?

(5) What was the nature of the payments of £300 per week made by Robert to his parents both before and after the dissolution of the Market Partnership?

In relation to issue (2), it became apparent that the phrase "entitled to separate capital accounts" might have been better phrased as "having separate capital entitlements", and the second part of the issue defined as "whether the partners had a joint capital entitlement". I have been invited by counsel to determine issue (2) on that basis.

16. I shall deal with the parties' detailed submissions in relation to those issues in due course. For present purposes it is a sufficient summary to say that Robert claims that his mother has no outstanding profit or capital entitlement, at least in respect of any period until December 2004. At the heart of his case is the claim that the partners agreed that his parents' profit entitlements should be limited, year by year, to their actual receipts which I have summarised above, or alternatively that any greater entitlement was waived by his parents by their conduct, and by their signing of each year's market partnership accounts. In the alternative, Robert raises limitation defences to limit the retrospective effect of his mother's claims.

THE EVIDENCE

17. Save for surviving accounts of the market and farm partnerships, and of Carol's equestrian businesses, this is not a heavily documented case. Furthermore, although Carol's business records were prepared by her in manuscript, so that she was able to speak to them, the originator of the farm and market partnerships' accounts, a Mr Williams, was not called to give evidence by either side. Although I received some limited assistance from an expert in accountancy called by Mrs Hopper, the factual inferences to be drawn from the manner in which the two partnerships' accounts (and the underlying accountants' working papers) were prepared therefore depends largely upon the court's reading of those documents in their background context. As for the possession action, the relevant documents are limited to the title deeds and declarations of trust in relation to plots A and B, Mr Hopper's will, and a small amount of correspondence with and between Mr and Mrs Hopper's professional advisers during the 1980s.
18. It needs to be noted that although at various stages the family described certain arrangements of their property and affairs as having been carried out "for tax purposes", none of them suggested either in evidence or by way of submission that any of the documents by which their arrangements were recorded were other than genuine. There was no suggestion that the profits of the various businesses were otherwise than as recorded in the accounts and working papers, or that the declarations as to beneficial interests in the relevant parts of the farm were, at the time they were made, other than true and effective.
19. I heard oral evidence from five members of the family, namely Mrs Hopper, Robert, Paul, Carol and her husband Richard Starkey. Mrs Hopper, by now in her 70s, gave her evidence calmly, clearly and with an apparent lack of rancour. While I consider that she sought to tell the truth as she perceived and believed that she could recall it, I have been unable to place complete reliance upon her evidence for the following reasons. First, (and this affected all the family witnesses to varying extents) her commitment to Carol's cause led her to exaggerate her evidence in serious respects. A typical example was her portrayal of Robert as the owner, at one and the same time, of a number of large and very expensive cars, for the purposes of portraying him as a man motivated predominately by money and personal possessions. Secondly, there was a tension between her disclaimer of all knowledge or understanding of partnership accounts on one hand, and her use from time to time of expressions such as "distributable profits" which suggested a greater understanding than she was prepared to acknowledge. This may have been, but only in part, a consequence of an excess of professional input into the drafting of her witness statement. Thirdly, she had a tendency to evade difficult questions about her late husband's conduct with the formula that it was not for her to explain that which he was not present to explain himself. Finally, she purported to be able to recall, word for word, a short angry conversation with her son as long ago as 1989, which presupposed powers of recollection which I found wholly improbable.
20. Robert came across as a straight talking unsophisticated witness who applied much less self-control to the giving of his evidence than did either his mother or sister. Nonetheless the reliability of his written evidence was seriously undermined in cross-examination, in particular in relation to his assertions as to his participation in, and contribution to the cost of, the purchases of the plots of land making up the farm. These involved serious exaggeration at the very least, but may have been attributable in part to an unconscious tendency to invent that which his relatively poor memory did not enable him to recall. More generally he also tended to exaggerate his case to a serious extent, in particular by denying all knowledge of his father's developing wish that Carol should obtain both the use and in due course rights of ownership in relation to the farm, knowledge on his part which I found to be established by the evidence of a number of other witnesses, including some with no axe to grind.
21. Carol gave her evidence, until just before the very end, with even greater calmness and self-control than her mother. She demonstrated much greater powers of recall, particularly in relation to matters of detail, than did Robert. Again however, the reliability of her evidence was spoiled by her exaggeration to the point of plain incredibility of the extent of the assurances which she claimed to have received from her father as to her ownership of the farm. Her case, in which she persisted throughout cross-examination, was that while she was still studying for her GCSEs her father promised her that if she went to college to learn how to work properly with horses, then he would give her the farm, and that he did just that when she left college in 1991, treating her as the owner of the farm from then on. When it is borne in mind that it was common ground that Mr Hopper had been offered £4 million for the farm by Tesco during the 1980s, that he had three other children with claims on his bounty and that he continued actively to carry on market gardening and a retail farm shop business on approximately half the area of the farm until the day he died, I regard her case that she was treated as owner of the whole farm from 1991 as wholly incredible. It was supported by her mother and her husband, but not by the balance of the independent evidence. Finally Carol's generally excellent recall for detail suggested to me that an occasional apparent lack of recollection in response to a difficult cross-examination question was the product of a slight evasiveness, in comparison in particular with her brother's more rough and ready approach.
22. I do not intend by the foregoing criticisms of the quality of the evidence of the three principal witnesses in the case to mean that I regarded any of them as seeking deliberately to mislead the court, or that their evidence was wholly unreliable. Substantial parts of what each of them said carried the ring of truth, and much of it was corroborated by documents and by the evidence of independent witnesses. On issues where important events were witnessed only by the three of them, and where documents provided no assistance, I was not persuaded that any of them demonstrated an inherent reliability that enabled me with any confidence to prefer one generally over the other or others. My conclusions of fact in relation to those issues have therefore depended to a considerable extent upon an assessment of the probabilities. In my judgment the truth not infrequently lay somewhere between the exaggerated accounts presented by participants in a deeply felt and utterly divisive family dispute.
23. Robert's brother Paul gave evidence in his support. For the most part he came across as a straightforward, apparently fair minded and honest witness. He had however little to contribute of real weight on the critical issues of factual dispute and, since he made no secret of his sense of outrage at what he regarded as his sister's desire to obtain possession of the whole of the farm regardless of the claims of her siblings, I cannot treat his evidence as the product of dispassionate independence.
24. The same goes for Carol's husband Richard Starkey. The brevity of his cross- examination made it difficult to form any settled view of his reliability as a witness, and he allied himself with what I have already described as the wholly unrealistic assertion that Mr Hopper treated Carol during much of the 1990s as already being the owner of the whole of the farm.
25. I heard oral evidence from 6 independent witnesses and read unchallenged statements from 5 more. Generally, those who were cross-examined displayed an unbiased desire to assist the court and some of them provided real assistance on factual matters at the periphery rather than the centre of the case. The only significant exception to the general appearance of reliability of the testimony of the independent witnesses was that of Mr Ray Spiers, who lived almost adjacent to the farm. He had an evident desire to assist the court, but his evidence tended to confuse his own speculation with objective facts that he observed and recalled. I have therefore been obliged to treat his evidence with more caution than that of the others.
26. Carol relied upon an expert valuation report from Simon Alden MRICS which was accepted by Robert as unchallenged. Mrs Hopper called as an expert on accountancy a Mr Nicholas Cowen FCA in connection with inferences to be drawn from the form of the market partnership accounts and the underlying working papers of the partnership's accountants. To the limited extent that his evidence was relevant, I found Mr Cowen to be an experienced and articulate witness. He had however been involved in advising Mrs Hopper on her claim both prior to and during the course of the partnership proceedings, and this factor, combined with a slight tendency to evade difficult questions in cross- examination caused me to have some reservations as to his complete independence. His evidence was nonetheless of some assistance.

THE FACTS

27. Mr and Mrs Hopper purchased plot A in December 1975 in their joint names. It appears from the plan lodged on first registration in 1981 that it then consisted of five fields together with a group of farm buildings, but no residential accommodation, the original Sheephouse farmhouse by then being in separate ownership. At that time Robert was 21 and Carol was almost 4. The property was in a run-down condition. Mr Hopper bought it for the practical purpose of growing vegetables for sale in his market business, but also to pursue an ambition to work in the countryside which originated from his having been evacuated to the country as a child during the Second World War. Plot A was also used (or came to be used) for the subsidiary purpose of stabling and grazing ponies, for which Carol developed an enduring love during her childhood, spending weekends and holidays there.
28. By December 1975 Robert had already begun working full time for his father in the market business. Having completed A levels in July 1973 he had attended a nine month course in accountancy at Oxford Polytechnic and worked briefly at a firm of accountants. Robert said that he had lent £2,000 to his father, from the proceeds of his sale of a motorised caravan which he had won in a competition. In cross-examination it became clear, that while adhering to his evidence that he had made a loan, Robert could not with any confidence connect the loan with his father's purchase of plot A.
29. On 28^th April 1977 Mr Hopper made what turned out to be his last will. After a pecuniary legacy of £15,000 free of tax to be divided among his surviving children he gave the entirety of his estate to Mrs Hopper, should she survive him for 28 days, and in default to his surviving children with stirpital gifts over.
30. On 22^nd September 1978 Mr and Mrs Hopper transferred a half beneficial interest in plot A to Robert and Philip. At the same time all four of them signed an acknowledgement of debt, the effect of which was to state that a pre-existing debt of the parents to the sons of £27,306.84 was treated as reduced to £4,806.84 by the use of £22,500 by Robert and Philip as consideration for the acquisition of that half share in plot A. Apart from the £2,000 loan to which I have referred, Robert could not in cross-examination remember any other debt owed to him or his brother by his parents. Nonetheless it is common ground that from that date Mr and Mrs Hopper's beneficial interest in plot A was reduced to a one half share.
31. It is not clear when the relationship between Mr Hopper and Robert as employer and employee in the market business was transformed into that of partners. Accounts for the farm partnership exist for the year ended 30^th June 1981, with prior year figures for the previous year. The earliest surviving accounts for the market partnership are for the year ended 30^th June 1988, with prior year's figures for a full previous year. Both were prepared by the same firm of Certified Accountants Messrs Davis, Burton, Critchley & Co under the immediate supervision of a Mr Williams and, subject only to a change in the firm's name to include reference to Mr Williams, the accounts of the two partnerships continued to be prepared by that firm until and beyond Mr Hopper's death.
32. The farm partnership accounts show that for the years ending June 1981 to 1983 the partners were Mr and Mrs Hopper and Robert. The 1984 and 1985 accounts are missing, and the accounts from 1986 onwards show the partners as including Lyn, who married Robert in 1980. The 1988 market partnership accounts show Mr and Mrs Hopper, Robert and Lyn as partners. I think it reasonable to infer (not least because of the tax advantages inherent in operating a farming and market partnership side by side) that the market partnership was established at the same time as the farm partnership, and that its partners were at all times the same.
33. At some time in 1981 Philip transferred his beneficial interest in plot A to Robert, and Mr and Mrs Hopper transferred the legal estate to themselves and Robert, where it resided until Mr Hopper's death. A letter in January 1981 from the family's solicitors William Sturges Trotter & Co to Davis, Burton, Critchley & Co shows that it was intended that Philip should transfer his share to Robert for £17,500 (being one quarter of a recently obtained valuation of plot A) and that it was Mr and Mrs Hopper's intention in due course to transfer their half beneficial interest in plot A to Robert, so as to obtain the fiscal benefit of their £50,000 lifetime allowances. That intention was never fulfilled. Although the undated transfer of Philip's share to Robert records the receipt by Philip from Robert of £17,500, Robert could not remember any details of the payment, acknowledging in cross-examination that the paperwork to record the transaction was arranged entirely by his father. Philip was not called to give evidence. Nonetheless, it is common ground that from 1981 onwards Robert has been a 50% beneficial owner of plot A, subject only to Carol's claims in these proceedings. On 5^th February 1981 Mr and Mrs Hopper and Robert executed a short declaration of trust recording that they held plot A as to 50% for Mr and Mrs Hopper as beneficial joint tenants and as to 50% for Robert.
34. In 1982 the opportunity arose for the family to purchase plot B, which was an L-shaped strip to the east and south of plot A, which added 13.9 acres to the 39.38 acreage of plot A. The two plots were not thereafter treated in any operational way as separate and were referred to collectively by the family as the farm. The eastern part of plot B proved to be too poorly drained to be suitable for growing crops, but its southern part was added to the acreage used by the farm partnership for its market gardening business.
35. Plot B was transferred on the completion of the purchase into Robert's sole name. There is no evidence as to who paid the purchase money, nor from what source, save that by the end of Robert's cross-examination it became common ground between him and his mother that she and her husband had purchased it. The price was probably derived from the profits of the market business. It is however common ground that, subject only to Carol's claims in these proceedings, plot B has been legally and beneficially owned by Robert throughout.
36. Plot C was acquired in 1984. There is an issue as to who paid for it, but since it forms no part of the subject matter either of Carol's claims or of the issues which I have to decide in the partnership proceedings, it is unnecessary for me to address that question. It is sufficient to say that it is now common ground that plot C has always been an asset of the farm partnership and that it falls wholly outside the scope of Carol's case as to the assurances which she was given by her father. When I refer in this judgment to "the farm" I therefore exclude plot C. It appears that plot C also proved unsuitable for market gardening, and that its use was or became mainly confined to the growing of Christmas trees.
37. I have already provided at the beginning of this judgment a snapshot of the manner in which the family conducted their farming and market business activities as at 1985. It is necessary now to look in a little more detail at the manner in which their business affairs were recorded in the market and farm partnership accounts. The earliest year for which there are accounts of both partnerships in the papers before the court is the year ended 30^th June 1988. In both accounts the partners are shown as Mr and Mrs Hopper, Robert and Lyn. Both are silent as to the partners' respective profit shares. Both contain relatively rudimentary capital account statements showing an opening and closing balance, adjusted in the case of the market partnership only by the addition of the year's net profit and a subtraction of drawings, and in the farm partnership by the subtraction of a net loss and the addition of a substantial loan from the market account and a smaller bank loan. Finally, the market partnership accounts describe the partners trading as "R.E. HOPPER", from which I infer that the assets and goodwill of Mr Hopper's market business were transferred to the market partnership on its inception.
38. Both Carol's and her mother's evidence suggest that, from an early age, Carol spent as much of her free time as possible pursuing her interest in horses, in particular at the farm. Carol describes in vivid detail how the time came when, taking her GCSEs, she decided that she wished to leave school and spend all her time working with horses and how, after a frosty reception from her mother, she was told by her father that:

"If I went to College to learn how to do it properly then he would give me the farm."

More generally she said that, as between herself and her father:

"The deal was that if I worked hard at this course and showed that I could do the job properly then I would take over Sheephouse Farm."

39. She then describes how she completed her GCSEs and thereafter obtained a National Diploma in Equine Studies at Warwick College of Agriculture, after a year's work experience with horses and a three year course at the college, part of the second of which was spent acquiring practical experience in Germany. Before completing her course, she said that she started the wedding carriage business with two white horses and a horse drawn-coach called Cinderella's Magic Carriage, using the farm as her base. Her evidence was that, from the moment she completed the course in 1991, the understanding between herself and her father was that the farm was hers.
40. At some time in the late 1980s it is common ground that the family received an offer for the farm from Tesco in the region of £4 million, and that it was rejected. The witnesses differed only as to the reason for that rejection. Mrs Hopper said that her husband had rejected it out of hand without consulting the rest of the family, because he considered that the farm was "there for Carol". Robert said that the offer was rejected after he had suggested to his parents that, after the inevitable large tax bill, the amount remaining for distribution among the family would be insufficient to make acceptance worthwhile. It is entirely unclear whether this incident occurred before or after Mr Hopper is alleged to have promised the farm to Carol once she completed her training. It is not necessary for me to resolve the issue as to the reasons why the offer was rejected. There may have been an element of both, and they are not inherently inconsistent. Furthermore, even if Mr Hopper then regarded the farm as needing to be kept available for Carol, that view is consistent as much with a desire to preserve it within the family for her use as it is with a promise to transfer it outright to her on completion of her studies.
41. Nonetheless the undisputed fact that Mr Hopper received an offer of £4 million for the farm makes it very improbable in my judgment that at or about the same time he promised it lock stock and barrel to Carol upon completion of her training. At the value reflected in Tesco's offer it represented by far and away the most valuable of the family's capital assets and, since he continued actively farming it himself until the day of his death, it is an almost inevitable inference that he continued to regard it as the centre of his own working life for the indefinite future. There is no evidence at all that he contemplated early retirement. Furthermore the change (which I am about to describe) of the basis upon which the market business was carried on, and which took place at approximately the same time, at the end of the 1980s, pursuant to which Mr Hopper ceased all active participation in the running of the market business, only reinforces a conclusion that Mr Hopper had plans for his own active use of the farm for the indefinite future, at the time when he is claimed to have promised it to Carol.
42. In my judgment, although grossly exaggerated, there is a kernel of truth in Carol's claim as to what occurred when she announced her wish to leave school. Although it is impossible to be precise, I conclude that Mr Hopper probably did assure Carol that if she took the idea of establishing a career in horses sufficiently seriously and obtained the necessary qualifications, she could expect that he would make available at the farm sufficient space for her to pursue her career there. I am confirmed in that conclusion by the fact that, from 1991 onwards, this is precisely what Mr Hopper did, for the rest of his lifetime.
43. My 1995 snapshot shows the market business being by then carried on in partnership, but with Mr Hopper very much in the driving seat. For example, he rather than Robert was responsible for liaison with the partnership's accountants, so that the format of the accounts for the year ended June 1988 (the only set which has survived for the period during which the business traded as R E Hopper) may be said to derive from the accountants' implementation of his instructions.
44. The catalyst for change occurred as the result of the partners' discovery of a fraud being practised upon them by an employed porter who, although disciplined by his union, could not be dismissed at acceptable cost. The difficulty was avoided by Robert setting up a parallel business named "R J Hopper" alongside the existing business, to which in due course the goodwill, assets and liabilities of the old business migrated, leaving the porter to be made redundant by the old firm. The earliest accounts of the new business, entitled "Mr and Mrs R J Hopper and Mr and Mrs R E Hopper trading as R J Hopper" are for the year ended 31^st December 1989, and include prior year entries for an undefined period in 1988. The capital account records no balance prior to the 1988 period, nor capital introduced. The balance brought forward into the 1989 year consisted of the undrawn profits of the previous year (namely £71,911 from profits of £106,395 less drawings of £34,484), together with capital introduced in the 1989 year of £192,472.
45. It is common ground that or about this time Robert took over the day to day running of the market business from his father, to the extent that thereafter Mr Hopper played no active part of any kind in the running of the market business, nor in the giving of instructions to its accountants. There is an issue whether this managerial take-over by son from father was amicable, but it appears to have been consensual. There is no evidence that Mr Hopper made any attempt to challenge it, and he was content to sign partnership accounts prepared as a result of information and instructions provided by Robert from then on until he died. Furthermore, it enabled Mr Hopper to devote the whole of his time and attention to activities on the farm. I do not find it necessary to decide whether, as Mrs Hopper alleges but Robert denies, he took over the running of the market business in circumstances which caused his father anger and grief, and which caused Robert guilt. It is common ground that under Robert's management the affairs of the market partnership prospered at least as well if not better than they had under that of his father.
46. The 1989 accounts of the market partnership are no more informative about the partners' capital entitlements inter se than had been the 1988 accounts of the R E Hopper partnership. The partners' profit shares are not identified, and the capital account does not distinguish between, or identify, the capital entitlement or liability (in terms of excess of drawings over profit share) of any individual partner. Even the identity of the partner or partners introducing the capital of £192,472 is not identified. Nonetheless it was common ground before me that the original profit share entitlements of the four partners in the market partnership were equal, that is 25% each. It is however also common ground that from the inception of the period when the market partnership traded as R J Hopper (which, after initial disagreement, the parties agreed was about 1989) Mr and Mrs Hopper's actual takings from the market partnership in every subsequent year until Mr Hopper's death were limited to a weekly sum (£250 rising to £300), payment of their residential mortgage instalments, payment of their income tax liabilities and occasional payments of much larger lump sums on request.
47. By a Rejoinder originally prepared in July 2007, but verified as true only on 18^th January 2008, Robert alleges that, after he took over the running of the market partnership, he agreed with his father that his parents' profit share should be limited to the amount of the payments made under those four headings in each year. Beyond the verification of that allegation (incidentally by a statement of truth signed by his solicitors), Robert has adduced no evidence in narrative form recording the making of that agreement, either orally or in writing, still less identified its probable date beyond the "after I took over" formula to which I have referred. In his witness statement in the partnership action he said that:

"… we took out of the partnerships by way of drawings what we felt we were entitled to take having regard to the amount of work that each of us carried out.

It was never openly discussed whether my father was happy with being paid a weekly sum whilst I was running the market although it was my understanding that he was. I feel able to draw this conclusion as my father was the type of person who was not afraid of confrontation and if he did not agree with the situation would have made his feelings known."

48. In cross-examination Robert said that he could not remember making such an agreement formally, that his father was hard to tie down, and that they had a loose relationship under which things just happened, rather than being discussed or negotiated. He said it was agreed "by deed" (by which Robert meant by conduct) rather than by word. He said that this arrangement materialised a few weeks after he had taken over running the market business and, later in his evidence, that the profit shares having been 25% each when the market partnership started, that ceased from the first month of his take-over.
49. In order to address the question whether Mr and Mrs Hopper's original 25% profit share was attenuated by an agreement to be inferred from conduct, it is necessary to have regard to facts occurring over a much longer period than 1989. It is however, clear that there was no express agreement of the type pleaded by way of Robert's rejoinder, either in 1989 or thereafter. This involves no rejection of Robert's evidence. In so far as the rejoinder asserts an express agreement, it is merely an impossible construct from evidence (mainly from Robert) to the contrary.
50. It is convenient next to record how the partners in the market partnership continued to record their mutual dealings as such in their signed accounts for the years ending in December 1990 and 1991. Both years' accounts adopted a similar format, which broke down the previously joint capital account statement into two separate statements headed "R J Hopper" and "R E Hopper". It is common ground that I should assume that R J Hopper meant Robert and Lynn, and that R E Hopper meant Mr and Mrs Hopper. I shall refer to the two columns as "RJH" and "REH".
51. In the 1990 accounts the closing capital account balance for 1989 of £256,704 is split as to £127,870 under RJH and £128,834 under REH. The two accounts are credited with substantially identical profits of £69,286 and £69,285, and debited with drawings of £92,934 and £14,700 respectively, leaving closing capital balances of £104,222 and £183,419, which are then aggregated in the sum of £287,641.
52. In the 1991 accounts RJH and REH are each credited with the balances brought forward from the separate accounts in 1990, and with identical profit shares for 1991, before being debited with drawings of £51,862 and £37,495 respectively, leaving separate balances of £96,236 and £189,800. To the right of the separate capital accounts, there is a joint capital account for the same year, which simply consists of the aggregates of each of row in the separate accounts.
53. Taken at face value therefore, the 1990 and 1991 signed accounts show that, as between Mr and Mrs Hopper on the one hand and Robert and Lyn on the other, there was an equal profit share entitlement of 50% each, and that in both years Robert and Lyn made drawings in excess of their profit entitlements, whereas Mr and Mrs Hopper made drawings significantly less than their profit entitlements. Furthermore, and critically for present purposes, the accounts of both years show Robert and Lyn's excess of drawings being debited to their joint capital account and Mr and Mrs Hopper's undrawn profits being credited to their joint capital account. The accounts give no clue as to the proportions in which the 50% profit share of each of the two couples was, if at all, subdivided, nor any attribution of drawings as between husband and wife in each case.
54. For all years after 1991 until Mr Hopper's death, the market partnership accounts reverted to a form of capital account presentation which, as in 1988, made no distinction between the entitlements or drawings of any of the partners. Thus in the 1992 accounts the 1991 joint closing balance of £286,036 became the opening balance. The total net profit of £124,760 was credited and the total drawings of £93,198 were debited, leaving a closing balance of £317,598. The same joint treatment was applied to the capital account in every subsequent year.
55. From 1988 onwards, there appears in the profit and loss part of the signed accounts under the heading "Allocation of profits" an apportionment of the year's net profit between each of the four partners on the basis of an express 25% entitlement. For the 1998 year each is shown as entitled to £21,183 (or £21,184) out of a total of £84,735, so that, for example, Robert's entry reads:

" Mr R J Hopper £21,183 25.00%"

56. For each of the years from 1994 onwards there survive accountants' working papers in the form of computer printouts which reveal that the process whereby the market partnership's accountants ascertained and calculated the amounts stated in the joint capital account section of the signed accounts involved an analysis under the headings " R J Hopper" and "R E Hopper" of separate opening balances, separate drawings and separate profit shares, just as must have been carried out for the purposes of the preparation of the 1990 and 1991 accounts. There is no evidence that any of the family ever saw any of these working papers and, since Mr Williams was not called as a witness, it is impossible now to know for what purpose he and his colleagues identified and calculated separate drawings (and sundry miscellaneous credits), separate opening and closing balances and separate but equal profit shares for the two groups of partners for the purpose of producing for signature a single joint capital account.
57. It is common ground that throughout the period 1989 to 2003, each of the partners paid income tax on the basis of a 25% profit share. Whether each of the husbands and wives were jointly or separately assessed for tax purposes was not revealed. But since they all paid income tax on an earnings rather than receipts basis, the computation of their respective tax liabilities required no investigation of their separate drawings. Robert offered no evidence of the reasons for the preparation of the working papers in this way. The evidence showed that the accountants carried out their task with minimal interference in the ongoing business, and with little need for active discussion or investigation of the underlying figures with Robert or any other partner.
58. A further material change in the accountants' treatment of the partners' capital entitlement occurred in and after 1998. In the accountants' working papers for those years, the totality of each year's net profits were credited to the R J Hopper capital account rather than, as previously, split 50/50 between that account and the R E Hopper account. This had the effect in the working papers of stemming what would otherwise have been an ever-increasing disparity in capital account entitlement as between the two accounts, in favour of R E Hopper. Since however the signed accounts continued to show only a joint capital account, the change in treatment of profits in the working papers had no affect whatsoever upon the signed accounts, which expressly declared the 25% profit shares of each partner. Again, no evidence was adduced before me of the reason for this change, so that its motivation in the minds of Mr Williams and his colleagues remains a matter of pure speculation.
59. Two other types of document were relied upon as throwing light upon the partners' understanding of their respective profit and capital entitlements. The first consisted of a "parents/spouse declaration of income form" signed by Mr Hopper and dated 28^th January 1992, in relation to an application by Carol for a Junior Agriculture Award. In it, he declared that his income for the year ended 5^th April 1991 was £15,600, and he left blank the column for Mrs Hopper, suggesting thereby that her income was nil. This provided some support for Mr Blackett-Ord's submission on Robert's behalf that Mr Hopper had by then accepted that his profit share entitlement from the market partnership was limited to the amount of his actual drawings.
60. Against that, I must assume (and Mr Blackett-Ord did not suggest otherwise) that all four partners signed tax returns throughout the relevant period declaring, in effect, that their entitlement to share in the net profits of the market partnership was on a 25% each basis. It is common ground that they were all assessed to tax throughout the relevant period on this basis. None of the relevant tax returns were produced in evidence, but their ghostly presence was in my judgment more than enough to displace any contrary inferences which I might have otherwise have drawn from Mr Hopper's completion of the declaration of income form.
61. I must now return to describe developments at the farm, from the time of Carol's completion of her studies in 1991. Although the details of what occurred were picked over at length in cross-examination, the general picture is clear. Starting more or less immediately upon her return (and having already established her Cinderella's Magic Carriage business whilst still at college) Carol proceeded to establish full time equestrian business activities at the farm, to the extent by the time her father died, she had arranged for the construction of stables, a horse school, a horse walker, a concreted yard and tarmac car park at the northern end of the farm, and fenced off a number of paddocks on both plots A and B for the grazing and exercising of horses. Furthermore, with her brother Paul's substantial assistance she converted part of a dilapidated farm building into a basic bed-sit for her own occupation. Leaving that item on one side, the effect of these activities was by 2003 that Carol was carrying on a significant, albeit not very profitable, equestrian business from buildings and facilities at the northern end of the farm, and upon fields or paddocks on the northern and eastern parts of the farm. In the meantime, her father continued his market gardening activities and established a farm shop on the western and southern parts of the farm. Although the paddocks were necessarily fenced off and thereby identifiable as being in purely equestrian use, a significant acreage in the centre of the farm appears to have been in a form of shared use between Carol and her father, in the sense that it was sometimes used for growing vegetables, sometimes for growing hay, and sometimes (when being rested) for the grazing of horses, enclosed only by a temporary electric fence. Essentially, each of them pursued their own distinct activities, but each from time to time assisted the other. As it was put in evidence, they all "mucked in".
62. Mr Hopper's farming and farm shop activities were of course carried on by him as manager of the farm partnership, with Mrs Hopper's considerable assistance, but with no active involvement by either Robert or Lyn. For present purposes it is convenient to describe them as his business activities by way of distinction with Carol's.
63. There was no significant dispute as to the parts of the farm used respectively by father and daughter during the period 1991 to 2003, save perhaps in relation to the shared use of the normally unfenced field which I have described. Nor was there any dispute that the value of the farm had been significantly increased as a consequence of Carol's activities. Mr Alden's valuation assessed the added value provided by those improvements at £125,000 as at 22^nd March 2007. There was however a lively dispute, conducted mainly in the form of a detailed cross-examination of Carol by Mr Blackett-Ord as to the cost incurred by her in making or arranging for them, and the extent to which costs which she claimed to have incurred were applied in improvements, as opposed to ongoing maintenance and repair. For example, Carol claimed as one of the largest elements of her improvement costs £25,000 spent on fencing. It rapidly became apparent however, not least from her description of the effect on an apparently robust fence on a three-quarter ton horse leaning over it to reach the grass beyond, that the bulk of it was in all probability spent upon repair and maintenance, an inevitable cost of the business of grazing horses likely to be incurred just as much by a temporary occupier as by someone believing herself to be an owner or to have been promised permanent ownership.
64. Mr Blackett-Ord sought to construct a case of deliberate exaggeration on Carol's behalf, not simply by way of an attack on the amount of expenditure incurred, but so as to challenge her credibility as a witness generally, and therefore as the sole witness of alleged assurances by Robert as to her ownership of the farm. Mr Blackett-Ord's criticisms were, first, that Carol had failed to provide disclosure of the type and volume which ought to have been available had she incurred the expenditure alleged; second, that such disclosure as she did provide only vouched for a modest proportion of the total claimed; and third, that there was demonstrable 'inflation' between her statement of case, her witness statement and her oral evidence.
65. There is some force in the first criticism. Although Carol disclosed meticulous hand-written books relating to her equestrian businesses for part of the relevant period, there was little disclosure of bank statements or other material demonstrating that she rather than anyone else had personally made the relevant payments. Since her business books did not extend back to the early 1990s it was however inevitable that she would be unable to vouch for the whole of her claimed expenditure over a twelve year period, so that there is in my judgment little substance in the second criticism. As to the third, Carol explained in cross-examination that she had found it difficult to remember all relevant expenditure when first confronted with the task, and that she recalled additional items and additional payments for items already claimed when revisiting the exercise on subsequent occasions. In my judgment this explains some, but not all of the 'claim inflation' of which Mr Blackett-Ord complains.
66. My conclusions on the question of Carol's expenditure are first, that although her devotion to her case has caused her to exaggerate, and in particular to fail to distinguish between repairs and maintenance on the one hand and improvements on the other, I am not persuaded that she has deliberately withheld relevant documents, or inflated her case to an extent that she knew to be untrue. As to the effect of that exaggeration upon the quantum of her claim to have incurred expenditure, I need only reach a relatively broad brush conclusion, not least because the effect of her and her husband's improvements is the subject of unchallenged valuation evidence which shows that the added value exceeds even her own estimate of her expenditure.
67. Leaving aside the added value attributable to the house which she and her husband had built, the effect of their other improvements to plot A is, according to Mr Alden, to have increased its value by £125,000 as at March 2007. Mr Alden attributes no improvement to the value of plot B from Carol's expenditure on fencing certain part of it as paddocks. Leaving aside work on the house, and ignoring for the moment Carol's and her husband's own time and labour, her claimed aggregate expenditure on plots A and B amounts to just over £70,000. That includes allowing a full £25,000 in relation to fencing which I consider to have been largely spent upon repairs and maintenance.
68. Doing the best I can, I assess Carol's expenditure of money upon the improvement of plot A at approximately £45,000. That allows a modest amount for fencing, and a rough and ready general reduction for exaggeration. It is evident that she and her husband devoted many hours of their own time and labour to those improvements. For reasons which will appear, I have found it unnecessary to place a price on their non-monetary contribution. It is sufficient for me to conclude that it was substantial.
69. A specific improvement to plot B calls for mention. In about 1992 or 1993 a Mr Schwartzenbach, the owner of the adjoining land to the south of the farm, was permitted to erect a stable complex at the south eastern corner of plot B, on terms that he should have three years' rent-free use of it, but that it should then revert wholly to the owners of Sheephouse farm. There is a dispute whether this was arranged by Carol purporting to act as owner of the farm, or by her father as sole manager of the farm partnership, and apparent owner of the farm. In that context Robert called Mr Doug McGregor, the estate and stable manager of Mr Schwartzenbach's property from 1997. He had no direct involvement in the original arrangement to build those stables, but played a part in the obtaining of retrospective planning permission in the late 1990s. His evidence was that it was all a matter between Mr Hopper, Mr Schwartzenbach and his representatives. Carol's evidence was that it had been arranged by her, purporting to act as owner of the farm.
70. Again, I find it unnecessary to resolve this issue. It is common ground that rent for those stables has always been paid until 2003 to or to the credit of the farm partnership, and that Carol incurred no personal cost in money, time or labour in or about their construction. Mr Alden's opinion is that those stables add £100,000 to the value of plot B, as at March 2007.
71. Of much greater significance is Carol's and her husband's construction of their house at the northern end of plot A. This began with the obtaining of planning permission in September 1997, for which purpose Carol and Richard instructed David Tapp Associates (Chartered Architects). Since both an initial refusal and the eventual grant of planning permission by the South Oxfordshire Council are to be found in documents addressed to Mr Hopper c/o David Tapp Associates, I infer that Mr Hopper was also party to those instructions.
72. The project was funded by an equity release loan agreement dated 28^th October 1999, pursuant to which Richard, Carol and Mr Hopper jointly borrowed £140,000 by way of a 204 month repayment mortgage secured on Mr and Mrs Hopper's matrimonial home at 4 Turners Drive, High Wycombe. The loan was drawn down in instalments as construction of the house proceeded. Works had proceeded to a point where the house was sufficiently habitable for Carol and Richard to move into it well before Mr Hopper's death. Nonetheless, the house has still not been completed, for reasons which were not fully explained in evidence, but which may have owed something to a combination of financial stringency and the uncertainties created by the present dispute.
73. In addition to the loan of £140,000 (which may have been increased to £160,000) Carol adds to her claim the sum £62,796 paid by way of interest by January 2007 (ongoing from then until trial) and, as in relation to the other improvements, claims the benefit of substantial time and labour which she and her husband devoted to the construction of their new home. Their evidence, which I accept, is that Richard gave up a job with the police and re-trained as a builder in or about 2000, so as to be able to carry out a substantial part of at least the internal works at the house himself.
74. Again, the increase in value of plot A attributable to the construction of the house (to the stage which it had reached by March 2007) substantially exceeds any estimate of the cost which Carol and her husband put into the project, being valued without challenge by Mr Alden as £500,000. It follows that, as at March 2007, the aggregate value attributable to all Carol's and her husband's improvements to plot A was £625,000.
75. There is an issue, addressed on a necessarily hearsay basis by a number of the witnesses, whether Mr Hopper was content with Carol's decision to build a house on plot A during his lifetime. Various witnesses describe him as having been, or reputedly been, angry at Carol's application for planning permission. In my judgment the explanation for this evidence is simply that Mr Hopper would have preferred that the house be built first, with planning permission being sought retrospectively, as was done in relation to the stables on plot B, so that his reputed anger (if such it really was) was merely that Carol and her husband chose prudently to adopt a less risky approach, by seeking planning permission first. The plain fact is that Mr Hopper was sufficiently persuaded of the good sense of his daughter's project to be prepared both to commit himself as a joint borrower of the necessary finance, and chargor of his and his wife's matrimonial home. Whatever his reservations as to the tactics, I conclude that he was wholeheartedly in support of the project itself.
76. I must now return to the central issue, namely the question what representations were made by Mr and Mrs Hopper and Robert, the legal and beneficial owners of plots A and B, upon the basis of which Carol carried out with her husband's assistance the improvements to plot A which I have described. I have concluded that, by the end of the 1980s, Mr Hopper had done no more than assure his daughter that if she went to college and obtained the necessary qualifications, he would enable her to put them into practice by establishing an equestrian business based at the farm, as indeed he did. Since Carol's and Mrs Hopper's evidence was that Mr Hopper had in the late 1980s promised Carol full ownership of the whole of the farm from the moment when she returned from College, and since I have rejected that as a large exaggeration, their evidence provides little assistance on the question whether, and if so when and how far, Mr Hopper's representations or promises to Carol went further than his original assurance to her whilst she was still at school.
77. Robert's evidence, and that of his supporting witnesses, is that Mr and Mrs Hopper's assurances to Carol never went beyond offering the farm as a place where she could run her business. Some of them hinted at a reputed concern on Mr Hopper's part that, were he to confer any beneficial interest in the farm upon Carol, it would be vulnerable to being obtained by Richard and removed from the family, in the event of their divorce.
78. Apart from that suspicion (which was not supported even by hearsay evidence of any specific statement by Mr Hopper to that effect) the main planks of Robert's case in this respect are as follows. First, Mr Hopper never changed his will. Second, he made no attempt at discussing or negotiating with Robert how the conferral upon Carol of any proprietary interest in the farm was to be achieved. Third, neither he nor Mrs Hopper transferred all or any part of their own joint beneficial interest in plot A to Carol, preferring to assist them in financing the construction of their house by offering their own matrimonial home as security. Why, asked Mr Blackett-Ord by way of submission, did Mr Hopper do nothing at all to fulfil any larger promises to his daughter by the time he died? Mrs Hopper's answer to the same question in cross-examination was that Mr Hopper had an unshakeable belief in his own immortality and died too suddenly to do anything about it, having been hard at work on the farm on the morning of the day of his death.
79. The gist of Robert's evidence, and that of his supporting witnesses, was that the story that Mr Hopper had always promised the farm to Carol was a fabrication created by Carol after his death, and supported by her mother. Thus, her brother Paul denied any knowledge (before reading Carol's defence in the possession action) that this had been his father's intention. Nonetheless, two of Robert's supporting witnesses hinted at a more modest understanding, namely that Mr Hopper may have promised Carol permanent ownership of the stables and her house, but not of the rest of the farm. This was the evidence of Nigel Eddons who worked on the farm for some ten years before Mr Hopper's death, and it is reflected in the evidence of David Rooke, who took a tenancy of the farm shop in 2004. He gave evidence of a discussion with Mrs Hopper and Carol some time after Mr Hopper's death in which he raised the possibility of renting some of the fields at the farm (previously used for market gardening) for keeping animals pending slaughter and sale, saying that Carol responded that "it did not matter to her whether I rented some of the fields or not because what she has never had she wouldn't miss."
80. The independent witnesses called in support of Carol's case make no distinction between the whole or part of the farm as the subject matter of Mr Hopper's assurances to Carol. All of them spoke simply in terms of the farm. There was however a distinction among those witnesses, and on occasion within the evidence of particular witnesses, between an understanding that, during Mr Hopper's lifetime Carol already owned the farm, and a belief that it had been promised to her when her father died. Neither of those two understandings was clearly predominant in the evidence of Carol's independent witnesses, and such modest difference in their relative credibility as I could discern from brief cross-examination afforded no basis upon which to reach a conclusion, one way or the other, from their evidence.
81. Nonetheless, the clear impression to be gained from taking the evidence of both sides' independent witnesses as a whole, was that Mr Hopper had at least assured Carol, at some unspecified time, that the farm would become hers after he died, albeit that there are significant indications that this promise may have been limited to that part of the farm over which Carol had established her equestrian businesses by the time Mr Hopper died.
82. Taking the evidence as a whole, I am satisfied that Mr Hopper probably did, at some time after 1991, augment an original assurance to Carol that she could use the farm for her planned business career with a promise that she could do so permanently, and that it was implicit in that promise that she would have conferred upon her a sufficient proprietary interest in the farm to be able to continue to do so after her father's death. Furthermore I am satisfied that he probably made the same assurance to her, either expressly or by his encouragement in her house-building project, in relation to permanent residential occupation at the farm. I am also satisfied, but on a narrower balance of probabilities, that these assurances related to the farm, rather than some specified part of it. By that I do not mean that an 'all or part' discussion took place between father and daughter, but simply that his assurances related to the farm generally, rather than to any part of it specifically.
83. In reaching those conclusions I have not ignored the substantial force of the main planks of Robert's case to the contrary. In my judgment however, Mr Hopper's failure to do anything to implement his assurances to Carol arose from the combination of a careless attitude towards his own mortality, and the undoubted difficulty of persuading Robert to agree to undo the tax-driven transfer of half the beneficial interest in plot A, and the whole of plot B to Robert in the 1980s. Mr Hopper was in no position to fulfil an assurance to Carol that she could have complete security of business or residential occupation at the farm, still less outright ownership of all or any part of it, and he did nothing in his lifetime towards the fulfilment of any such promises.
84. Mrs Hopper was also of course throughout the 1990s a one quarter beneficial owner of plot A, and she did no more than her husband to fulfil any promises or assurances to Carol by 2003. Nonetheless I am satisfied that she both knew and approved of the assurance which I have concluded that Mr Hopper did make to Carol. After her husband's death, she transferred to Carol the whole of the beneficial interest which, before he died, he and she had owned jointly. In my judgment she did so out of a conscientious desire to do all she could to make good her late husband's assurance to her daughter, with which she had concurred when it was made.
85. A main plank in my conclusion that Mr Hopper assured Carol of rights in relation to the farm sufficient to secure her occupation after her father's death is that I think it most unlikely that she and her husband would have committed themselves to the building of their matrimonial home there if some such assurance had not been given. The project to build the house involved incurring liabilities of an altogether different magnitude from those incurred in running the equestrian businesses at the farm. Although this was not investigated in evidence, I think it unlikely that Carol shared her father's expectations as to his immortality by the late 1990s.
86. The question whether Mr Hopper promised Carol an enduring proprietary interest in the farm is a necessary aspect of her claim, but the critical aspect of it is the question whether Robert gave any similar assurance to her, or whether by his words or conduct he associated himself with the assurance made in Carol's favour by his father, as his mother did. In this respect Carol's pleaded case relies on three specific instances where Robert did so, all contained within paragraph 21 of the Amended Defence and Counterclaim as follows:

""Furthermore the Claimant himself encouraged the Second Defendant in her activities at Sheephouse Farm and encouraged her to believe the farm belonged to her.

PARTICULARS

(a) in 1991 or 1992 when the Second defendant was converting the stable and tack room into a feed room with upstairs rooms she explained her plans for Sheephouse Farm to the Claimant and he encouraged her, giving her the clear impression he believed Sheephouse Farm to be hers, and gave her a wicker dining table, chairs and matching sofa with which to furnish the upstairs rooms;

(b) in approximately 1995, two days after the Second Defendant's dog had died, the Claimant took the Second Defendant out for lunch: during the conversation he told her that it was for Mr Hopper senior to decide what to do with Sheephouse Farm, that it was fine by him that the Second Defendant had been given the farm and that she should press on and make a success of it; and

(c) in approximately 1999, at the time the Second Defendant and Richard were beginning to convert redundant farm buildings for their own residential use (for which see below), the Claimant visited Sheephouse Farm, admired the work and referred to the house as being the Second Defendant's."

87. Taking those occasions in turn, it was not in dispute that, shortly after her return from college, Robert witnessed Carol converting part of the farm buildings for purposes connected with her equestrian business, and that he encouraged her by providing some furniture for her to use. But Carol's evidence fell short of asserting anything from which it could be inferred that Robert thereby knew that Carol believed the farm to belong to her, still less that he encouraged her in that belief. All it shows is that Robert knew, approved of and encouraged Carol's setting up of an equestrian business at the farm, in accordance with the assurances which I have found that her father had given to her, to the effect that this would be permitted. Since I have concluded that Mr Hopper had given her no larger assurance by that time, sub-paragraph (a) of the Particulars to paragraph 21 does not assist Carol.
88. Paragraph 21(b) raises the most difficult factual issue in the case. Both Carol and Robert claimed to be able to remember in some detail a lunchtime conversation shortly after Carol's dog had died in 1995. Both purported to remember it with an unrealistic degree of vivid detail, bearing in mind that it took place more than ten years ago. The only common ground between their accounts is that Robert explained to Carol that the farm was partly in his name and partly in his and his father's name.
89. Carol's evidence was that, by the end of the conversation Robert had made it clear that he expected Carol in due course to get the farm (because he expected to get the market business) and that, in any event, he knew that his father wanted her to have the farm, and that that was fine by him. Robert's evidence was that, after explaining that he was a co-owner of the farm, he told Carol that she had not been given any part of it because she had not yet earned it. Robert denied that he either knew or was told by Carol of any promises by his father that she should obtain a proprietary interest in the farm, still less that he gave her any encouragement in that regard.
90. I did not find either Carol's or Robert's account of that conversation probable, or persuasive. Bearing in mind that Robert had by then been the half owner of plot A and the sole beneficial owner of plot B for well over ten years, and knew that a supermarket had offered £4 million for the farm in the late 1980s, it strikes me as very unlikely that Robert would have made, in effect, an outright gift of that interest to Carol only four years after she started her equestrian business at the farm. I was not persuaded by Carol's evidence that he did so out of a sense of guilt in connection with his take-over of the market business from his father in 1989.
91. While Robert's account is less inherently improbable, it was one which suffered from embellishment between the stages of pleading, witness statement and cross-examination, and his suggestion that it was triggered by Carol telephoning him "demanding a piece of land" seems wholly improbable.
92. In my judgment, as so often in this case, the truth lies hidden somewhere between two improbable extremes. I find that there was a conversation between Robert and Carol in which Carol learned from Robert, probably for the first time, that he had a substantial interest in the farm. I find also that, probably out of sympathy arising from Carol's loss of her dog, Robert listened sympathetically to a description by Carol of her plans in relation to the farm, including her wish to build a house on it, and that he said nothing to suggest that he would do anything to prevent or interfere with the realisation of those plans. In my judgment nothing was said about how Carol's business and residential ambitions in relation to the farm were to be safeguarded in the event of Mr Hopper's early death, but equally, I am satisfied on balance that the discussion about her plans was not predicated upon any assumption by her or suggestion by Robert that she needed to limit her ambitions in relation to the farm to her father's lifetime.
93. It was a common feature of both accounts of the 1995 meeting that some discussion occurred upon the question whether Carol was paying her father rent for her occupation of parts of the farm, and in particular the stables. I am satisfied that, whatever Carol said about whether she was or was not in fact paying rent, Robert was content to leave that question to be dealt with between Carol and her father, as manager of the farm partnership, to which he would have thought that any such rent should be payable. There is a separate and perhaps more important question whether Carol was in fact paying rent in respect of her occupation of part of the farm. If she was, it would be fatal to her case that she regarded herself as already its owner, but it would afford some basis for her alternative case that, by the time of her father's death, she had become an agricultural tenant.
94. Both Carol's books and the accounts of the farm partnership suggest that she was making irregular payments of rent of varying amounts during parts of the relevant period. Carol's evidence was that she was making payments as and when she could, not as rent, but as tokens of gratitude for all that her father was doing for her in supporting her equestrian career at the farm, but that she had been advised to treat the payments as rent by the family's accountants. I accept that evidence. In my judgment she made the payments to her father out or moral obligation in the context of a loose family arrangement which enabled her to use varying parts of the farm over time. In my judgment the payments were neither the consequence of a relationship of landlord and tenant, nor were they such as to give rise to such a relationship. Since I have rejected Carol's case that, during her father's lifetime, she thought she had already become the beneficial owner of the farm, and since the making of such payments is not inconsistent with an expectation, encouraged by her father, that she would acquire a proprietary interest in it upon his death, those payments are not on my analysis ultimately of real consequence in terms of the success or failure of her claim.
95. The third event relied upon as constituting a relevant promise or assurance by Robert, in paragraph 21(c) of the Amended Defence and Counterclaim, gave rise to no significant evidence. Carol made no reference to it in her witness statement, and the only apparently confirmatory evidence from her husband turned out to relate to a separate occasion upon which, while he and Carol were house-sitting at the property adjacent to the northern edge of the farm (known confusingly as Sheephouse Farmhouse), Robert came to dinner there while the construction of Richard and Carol's new house was taking place next door.
96. The gist of paragraph 21(c) is that Robert referred to the new house as being Carol's while it was being built. In cross-examination Robert readily acknowledged his view that the house (by which he meant the bricks and mortar rather than the land on which it stood) was indeed Carol's, and he acknowledged without hesitation an understanding that at some time in the future a discussion would have to take place about the consequences of a house belonging to Carol being situated on land in which she had no beneficial interest.
97. In my judgment this third element of Carol's case that Robert made relevant assurances is, in that limited sense, made out. Although her case that Robert actually said that he regarded the house as hers is proved by nothing more than a bare statement of truth on the Amended Defence and Counterclaim, Robert's evidence as to his own attitude leaves me with little difficulty in concluding that, at some time during the construction of the house, he made it known to his sister, by his words or conduct, that he regarded the house itself (rather than the land) as hers, on the basis that she was arranging for and financing its construction.
98. Before leaving the facts, I must briefly recount certain events which followed Mr Hopper's death. I have already explained that in May 2005 Mrs Hopper brought about a variation of her husband's will whereby his 25% of plot A was vested beneficially in Carol. She also attempted to transfer her own 25% by a transfer which, in the event, Robert refused to sign. Nonetheless I was invited by Miss Windsor, who appeared both for Carol and Mrs Hopper in the possession action, to assume that Mrs Hopper had succeeded in substance, if not strictly in form, in transferring her beneficial share of plot A to her daughter, or at least that I should address the issues on the basis that it was common ground between them that she had done so.
99. The business of the farm partnership was wound down following Mr Hopper's death, by converting the fields previously used for market gardening to grass for hay and grazing and by letting the farm shop. By contrast, the business of the market partnership continued after Mr Hopper's death exactly as it had previously been carried on. In particular, Robert remained in day to day charge, and Mrs Hopper continued to receive the payments of £300 a week previously paid to herself and her husband. No steps were taken to have the market business wound up.
100. The accounts for the market partnership for the year ended December 2004 were prepared and signed by Robert, Lyn and Mrs Hopper on the basis of the same 25% allocation of the profits to each of Mr and Mrs Hopper, Robert and Lyn, but recognising that Mrs Hopper signed as Mr Hopper's executor. Signature took place on 25^th May 2005. The 2004 accounts were signed in disputed circumstances but it is unnecessary for me to resolve that dispute.
101. By that time Robert had caused the weekly payments made to his mother to be discontinued, and this in turn led to Mrs Hopper seeking Mr Williams' advice as to her profit entitlement from the market partnership. This led to the production of a schedule (named after one of Mr Williams' employees as "the Terri Schedule") setting out what in Mr Williams' view would be the partners' mutual capital account entitlements, as between Robert and Lyn on the one hand and Mrs Hopper and her husband's estate on the other, as at December 2005. The Terri Schedule was prepared on the assumption that the process of adding undrawn profits to capital account and deducting overdrawings against profits from capital account continued as reflected in the 1990 and 1991 signed accounts, and (contrary to the assumptions in the post 1997 working papers), that the equal profit share entitlement had continued throughout. When the Terri Schedule is understood as describing positive amounts as negatives, and vice versa, it shows a capital account entitlement of Mrs Hopper and her husband's estate at £295,838.21, and a capital account deficit for Robert and Lyn of £414,565.73. The correctness or otherwise of the Terri Schedule as a matter of quantification is not among the preliminary issues which I have to decide.

CAROL'S ESTOPPEL CLAIM

102. There was no dispute as to the law, so far as it defines the conditions for the arising of a proprietary estoppel. Miss Windsor and Mr Blackett-Ord were content that I should adopt the summary given by Oliver J in Taylors Fashions Ltd v. Liverpool Victoria Trustee Co Ltd [1982] QB 133n at 144, as follows:

"If A under an expectation created or encouraged by B that A shall have a certain interest in land, thereafter, on the faith of such an expectation and with the knowledge of B and without objection by him, acts to his detriment in connection with such land, a Court of Equity will compel B to give effect to such expectation."

103. Counsel were also united in inviting me to apply the re-statement in terms of proportionality of the traditional search for "the minimum equity to do justice" set out in length in the judgments of Aldous LJ and Robert Walker LJ in Jennings v. Rice [2003] 1 P&CR 8 when deciding how any estoppel in Carol's favour should be satisfied. The basic principle is that the court has a broad discretion how to satisfy a proprietary estoppel. The way in which the exercise of that discretion is affected by the requirement of proportionality can only be satisfactorily be understood by reading the whole of the judgments in Jennings v. Rice. I will of necessity confine myself to some short extracts from the judgment of Robert Walker LJ. The issue in the case was whether the estoppel should be satisfied primarily by reference to the claimant's expectations, or by reference to the quantification of the detriment suffered by the claimant on reliance upon them.
104. At paragraph 49 Robert Walker LJ said this:

"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."

After a reference to a faint parallel with part performance, he continued:

"So with proprietary estoppel the defendant is charged with satisfying the equity which has arisen from the whole sequence of events."

Then at paragraph 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 is to fulfil the claimant's expectations. But if the claimant's expectations are uncertain, or extravagant, or out of all proportion to the detriment to 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.

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. Detriment can be quantified with reasonable precision if it consists solely of expenditure on improvements to another person's house, and in some cases of that sort an equitable charge for the expenditure may be sufficient to satisfy the equity…."

Finally, after reference to dicta of Hobhouse LJ in Sledmore v. Dalby (1996) 72 P&CR 196, he concluded, at paragraph 56:

"The essence of the doctrine of proprietary estoppel is to do what is necessary to avoid an unconscionable result, and a disproportionate remedy cannot be the right way of going about that. Cases on interim injunctive relief have recognised the importance of proportionality in the granting of equitable remedies: see for instance Lock International v. Beswick [1989] 1 WLR 1268, 1281. Where the court is granting final relief after investigating all the facts proportionality is even more important."

105. The facts of the present case add an element of complexity to the application of those principles which is not, so far as counsel were aware, addressed in any reported case. Complexity arises first because Carol's claim is based upon assurances by three co-owners of the farm and secondly because, before Carol brought her claim by way of response to Robert's claim for possession, her mother had done what she could to satisfy Carol's claims by transferring her own and her late husband's interests in the farm to Carol. Those facts have an important effect upon the questions first, whether Carol still has any equity which has not been satisfied, and secondly, if she has, how and at whose expense any continuing equity should now be satisfied.
106. It is in my judgment plain that, at the time of Mr Hopper's death, Carol had acted to her detriment on the basis of expectations created by assurances from her father, and endorsed by her mother, that she should obtain some proprietary interest in the farm as the basis for continuing her equestrian businesses and enjoying her recently built matrimonial home beyond the date of either or both her parents' death. For the reasons which I have given, I am satisfied that an assurance which, when originally given, amounted to no more than a promise that Carol should be permitted to use the farm to establish her equestrian businesses had, by 2003, matured into that larger assurance which I have just described.
107. I am also satisfied that, by his conduct, in particular while the new house was being built, Robert created a reasonable expectation in Carol's mind that she would not have to risk being divested of possession of that recently built dwelling house upon the death of either or both of her parents.
108. As between Carol and her parents, while I acknowledge that the language in which Mr Hopper's assurances may have been couched might, literally construed, have appeared to her as an assurance that she would receive the whole of the farm in due course, so that she came to have an expectation to that effect by the time of his death, I am satisfied that such an expectation was both extravagant and out of all proportion to the detriment which she claims to have suffered in reliance upon it. She was by then conducting a mature equestrian business on only a part of the farm, and her new house had been built on a very small part of the northern end of plot A. Furthermore, she knew from 1995 that it did not lie strictly within her parents' power to confer ownership of the entirety of the farm upon her, having had its beneficial ownership explained to her by Robert.
109. As against Robert, my findings of fact are nowhere near sufficient to justify an expectation on Carol's part that Robert would not object to her acquiring the whole of the farm without regard to his substantial and long-standing beneficial interest in it. It was simply not an expectation which, as against him, it was reasonable for her to form. Even if she did form it, it was equally extravagant, and out of all proportion to the detriment which she claims to have suffered.
110. I have considered whether Carol has satisfied the burden of showing separately as against Robert, that she relied upon his conduct rather merely upon the conduct of her parents. On balance, I have concluded that she did sufficiently rely also upon Robert's conduct in relation to her construction of her house, once appraised by him of the fact that he had a substantial beneficial interest in the farm.
111. Proprietary estoppel is not however complete merely by the combination of assurances, expectations and detrimental reliance. There must also be conduct, actual or threatened by the representor which it would be contrary to conscience to permit him to pursue. In Lord Oliver's simple A and B example, that would normally be constituted by B's personal representative's refusal to confer upon A any sufficient proprietary interest in the subject property, or to compensate A for her detrimental reliance. In the present case Mr Hopper might be said to have acted unconscionably by leaving his interest in the farm to Mrs Hopper rather than to Carol, but by transferring both his and her interests to Carol Mrs Hopper has done everything in her power to satisfy Carol's expectations, at her and her husband's estate's expense, but at no cost to Robert.
112. The effect of those steps taken by Mrs Hopper was to confer upon Carol an interest in the farm which, valued as at March 2007, was worth £867,550 (that is, half the value of plot A in its improved state). In terms of value, that is significantly in excess of the value of the improvements to plot A constituted by the aggregate of the works done in connection with her equestrian business, and the construction of her house, amounting to £625,000. It is, for the reasons I have given, even more substantially in excess of the aggregate of her detrimental expenditure even if an amount is added for her and her husband's labour.
113. Carol's equitable claim against Robert arises from his seeking possession of the farm for the purpose realising both his and Carol's beneficial interests in it, being 50/50 in relation to plot A, and his alone in relation to plot B. It is therefore necessary to decide whether Carol's equity derived from detrimental assurances of her parents and Robert has been satisfied by the conferral upon her of a 50% beneficial interest in plot A. If it has, then it seems to me that the estoppel claim against Robert fails in limine. If it has not, then it is still plainly necessary to take fully into account Carol's receipt of a 50% beneficial interest in plot A, in deciding how any outstanding equity against Robert should be satisfied.
114. In relation to both those issues Miss Windsor submitted that any outcome which left Robert with one penny by way of benefit from his sister's improvements to the farm would be so unjust as to lead necessarily to the conclusion that Carol's equity had not thereby been satisfied. Mr Alden's evidence shows that Carol's improvements to plot A have increased the value of Robert's half interest, as at March 2007, by £312,500 (that is half the difference between the improved and unimproved values of plot A). Accordingly, Miss Windsor submits that a sale of the farm for the purpose of realising Robert's and Carol's interests would lead to him being unjustly enriched by that amount. Alternatively, if full effect was given to Carol's expectation of permanent enjoyment of the house and of that part of the farm which she was using as at the date of her father's death, by a partition of plot A as between Carol and Robert pursuant to section 14 of the Act of 1996, then Robert would be unjustly enriched by either or both of a combination of too much land or too much equality money, attributable in either case to the value of Carol's improvements.
115. In support of those submissions Miss Windsor relied upon a short dictum by Dyson LJ in Yeoman's Row Management Ltd v. Cobbe [2006] EWCA Civ 1139, at paragraph 120:

"The court has a wide discretion to fashion the remedy which achieves justice between the parties and properly satisfies the claimant's equity."

Miss Windsor submitted that justice between the parties would not be achieved if Robert was enriched in any amount by virtue of Carol's improvements to the farm.

116. In my judgment that submission is wrong for three reasons, one a matter of principle, and the other two peculiar to the present case. In principle, proprietary estoppel is a remedy which addresses the injustice caused by detrimental reliance upon expectations reasonably created by representations, conduct or, sometimes, standing by. As is made clear in Jennings v. Rice, the court's focus is not upon stripping the giver of the assurances of any unjust benefit, but upon affording to the recipient of them a remedy which is proportional to the appropriate combination of her expectations and her detriment. In Lord Oliver's A and B paradigm case, such a remedy may commonly be described as stripping the giver of the assurances or his estate of any unjust benefit by conferring a proportionate remedy on the recipient. The remedy simply transfers benefit from B to A, and in the words of Dyson LJ achieves justice between the parties. Paragraph 132 of his judgment in Cobbe shows that on the facts of that A and B case, the remedy afforded to A prevented B from being "disproportionately advantaged by the grant of the Planning Permission".
117. The present case is critically different, because Carol has received from her parents a benefit in the form of their half interest in plot A, at no cost to Robert. To the extent that it satisfied her equity, but leaves Robert to enjoy a part of the increase in the value of plot A attributable to her improvements, that causes Carol no injustice, any more than a creditor suffers an injustice when one of two sureties pays the entire debt, leaving the other surety free from any claim from the creditor. The injustice, if any, would arise between the two sureties, and here between Robert and his mother. In the case of sureties, the court provides an equitable remedy of contribution in order to do justice in such circumstances. The same may be said of a case in which one of two joint tortfeasors has provided full compensation for the claimant's loss, at no cost to the other.
118. Counsel could find no reported case in which this difficulty has been addressed in the context of proprietary estoppel. I see no reason in principle why one of two co-owners of property should not seek contribution from the other if he or she has satisfied a proprietary estoppel arising from assurances given by both of them, at no cost to the other. The extent of any contribution ordered would depend, among other things, upon the relative responsibility of each of the two co-owners for the making of the assurances in the first place. In the present case, no such claim has been advanced by Mrs Hopper against Robert, and if it were to be advanced, Robert might well meet it by showing that the prime mover in the giving of assurances to Carol was his father and that, as between himself and his mother, she rather than he should bear any residual burden not capable of being satisfied by his father's share of plot A. On any view, it seems to me that Robert bears the least responsibility for the making of assurances upon which his sister relied.
119. My third reason for reaching the same conclusion is that even though Robert encouraged a legitimate expectation in Carol that she should receive a proprietary interest in the farm sufficient to secure her use and occupation of her new house after her parents' death, nothing he said or did justified an assumption that her interest should adversely affect the value of his share, if his parents' share was sufficient for the purpose. I asked Miss Windsor how, purely on the hypothesis that the conferral of a half interest in plot A was a full proportionate satisfaction of Carol's equity, it could be other than over-compensation to add to her receipt a large additional amount representing the increase in the value of Robert's half share attributable to her improvements. I received no satisfactory answer.
120. I return therefore to the question whether Carol's equity has been satisfied by Mrs Hopper's transfer to her of a half interest in plot A. While it plainly has in terms of strict value, the transfer nonetheless leaves Carol vulnerable to Robert's claim for a sale under section 14 of the 1996 Act, because if such a sale were ordered, then the only way in which Carol could secure permanent occupation of her new house, or avoid the forced re-location of her equestrian business, would be by outbidding Robert or any other purchaser of plot A. As a special purchaser with a unique interest in retaining possession, she might well be bidding at a grave disadvantage.
121. I consider therefore that in order fully to satisfy Carol's equity it is necessary to fashion a remedy which ensures her continued occupation of that part of plot A upon which she resided and upon which at the date of her father's death she was carrying on her equestrian business, without thereby increasing the net value of what she obtains beyond 50% of the improved value of plot A, or by the same token reducing the value of Robert's share below 50%.
122. Before addressing the means whereby that may most fairly be achieved, I must briefly deal with plot B. Carol was at the date of her father's death using a part of plot B for the grazing or horses, and had fenced it in many years previously, but without (according to Mr Alden) thereby adding anything to the value of plot B. While Carol's reasonable expectations derived from her parents' conduct may have been understood by her in relation to the farm generally, rather than to plot A on its own, I do not consider that Robert's conduct justified any expectation that he would provide her with a proprietary interest in plot B which he owned absolutely, rather than in plot A, in which he shared the beneficial interest with his parents. Nonetheless it seems to me fair (if it can be achieved without devaluing Robert's interest) that the satisfaction of Carol's equity should be achieved by ensuring the availability to her within plot A of broadly the same acreage as she was using for grazing within the farm at the time of her father's death, but confining the effect of any remedy to plot A, if necessary by an increase in the acreage within plot A apportioned by way of partition to Carol, leaving residue of plot A and the whole of plot B for Robert. That increase may be capable of being achieved within the area of plot A which, as I have described, was in shared use as between Carol and her father, during his lifetime.
123. In my judgment there are two methods of satisfying Carol's equity in that way. One is to permit Carol to acquire Robert's interest in plot A for its present value, in which case Carol will have ample acreage to make good the shortfall in grazing land occasioned by her loss of use of any part of plot B. The other is to partition plot A in such a way as to leave Carol with all that she occupied at her father's death together with additional acreage equivalent to that which she then enjoyed on plot B, but requiring her to pay Robert equality money so as to make good any deficiency between the value of the acreage which he thereby receives from the partition of plot A, and a half beneficial share in plot A. The second of those alternatives could be achieved simply by means of section 14 of the Act of 1986, but the first could not. This is because section 14 confers on the court all those powers of the trustees of the land, but relieving them from any obligation to obtain any relevant consents. By section 7 trustees of land have a power to partition with consent of the beneficial owners. By contrast, nothing in section 14 confers upon trustees of land the power compulsorily to purchase the interest of a beneficial owner.
124. Since either of those alternatives would, in my judgment, fully satisfy Carol's equity (she being, on the evidence, in a position to pay Robert for his share, or to pay equality money on a partition), Robert ought in principle to be entitled to choose between them. Mr Blackett-Ord submitted that I should take neither of those courses, because they would both necessarily proceed upon a valuer's assessment of the value of plot A, or of any partitioned part of it, rather than upon a true realisation of its market value, achieved by public marketing and the holding of an auction, at which both he and Carol would be at liberty to bid. There is of course always the risk that the most competent valuation will be made in ignorance of the secret wish of a special purchaser to acquire the property at an inflated price (such as Tesco in the late 1980s). In my judgment that is a risk which must be run if Carol's equity is fairly to be satisfied. If Robert chooses the partition route, he would still be left with plot B and a substantial part of plot A to sell in the open market.
125. I therefore propose to allow Robert time to choose between those alternatives. Both the choice between and the implementation of either of them will require an up-dated valuation of the farm, and additional valuation evidence about the equality money necessary to avoid partition causing any beneficial advantage to one party or the other. I will hear submissions as to how both the choice, and the valuation consequences of it should be addressed as a matter of case management.
126. My conclusion on Carol's estoppel claim makes it unnecessary for me to address the other issues in the possession proceedings. The choice of either of the alternatives which I have outlined will leave no room for a separate application of section 14 of the Act of 1996, and Carol's weakly advanced claim to be an agricultural tenant of the farm falls by the wayside.

MRS HOPPER'S PARTNERSHIP CLAIMS

127. I have already outlined the preliminary issues which it has been agreed and directed that I should decide at this stage. Issues (1) and (4) relate solely to the period following Mr Hopper's death, and are best addressed after issues (2), (3) and (5), which relate, at least potentially, to the whole of the period between 1989 and now. It is in my view also unrealistic to address issues (2), (3) and (5) in isolation from each other. They all form different aspects of what is in reality a single question, namely whether prior to the outbreak of the present dispute, Mr and Mrs Hopper's annual receipts constituted the entirety of their entitlement by way of profit share from the market partnership, so that they obtained no augmentation of their capital entitlements, year by year, by reference to any undrawn share of profits.
128. Both parties start from the common ground that at the outset of the re-formed market partnership in 1989, each partner had a 25% profit share entitlement. Mrs Hopper's case is that this entitlement was never varied nor abandoned, and that the ordinary consequence of the fact that she and Mr Hopper regularly drew much less than their profit share is that the balance fell to be added to their capital entitlement, which is now payable to Mrs Hopper as a partner in her own right and as her husband's personal representative.
129. I have already mentioned and rejected Robert's case that his parents' profit share entitlement was varied by express agreement. His alternative cases are first, that there was a variation by conduct; second, that there was a year by year waiver by his parents of any entitlement to undrawn profits, or alternatively of any entitlement in excess of 25% each of the joint capital account balance shown in the signed accounts for every year after 1991. His third alternative is that his parents have lost the right to recover any excess of their profit shares over their drawings in respect of the period ending 6 years before the commencement of Mrs Hopper's proceedings by reason of limitation or laches.
130. I rejected the argument that Mr and Mrs Hopper expressly agreed to vary their profit share entitlements both because of the absence of any evidence to that effect, and because the 1990 and 1991 signed accounts show the parents' combined capital entitlement as being augmented each year by the aggregation of the undrawn part of their 50% combined profit share. Furthermore, every set of signed partnership accounts from and after 1998 contains an express signed declaration by all partners recognising that Mr and Mrs Hopper each continued to enjoy a 25% profit share entitlement.
131. I must now address the submission that Mr and Mrs Hopper agreed to a downward variation of their combined 50% profit share by their conduct. In this respect Mr Blackett-Ord relied upon the following matters. First, he pointed to the rigid adherence by Robert and his parents to a pattern of payments by him to them limited to the weekly amounts, the parents' mortgage instalments and their income tax liabilities. Secondly he pointed to the income declaration made in 1992 by Mr Hopper. Thirdly he relied upon the absence of any demand by the parents for any further or other payments at a time when, as Mrs Hopper acknowledged in cross-examination, she knew (from day one) that Robert and Lyn were taking out more than she and Mr Hopper were receiving. She said that she was happy to let Mr Hopper decide these matters while he was alive, but saw no reason to continue with that course after his death.
132. In my judgment those matters, whether taken singly or collectively, come no nearer to supporting an agreement by conduct than to an express agreement. From 1998 onwards, all the partners signed accounts which regularly declared Mr and Mrs Hopper's continuing combined 50% profit share. The 1990 and 1991 accounts did the same by necessary implication. Mrs Hopper's evidence that she knew that Robert and Lyn were taking more every year points to no more than a readiness to follow her husband in seeking annual drawings well below their annual profit shares. It is not evidence which is in my judgment in any way inconsistent with Mrs Hopper's evidence that, in her mind, her husband's and her own undrawn profits were accumulating every year in what she described as a 'pot'.
133. Furthermore, it is common ground that Mr and Mrs Hopper could, and did on occasion, ask for and obtain additional lump sums from the market partnership when they had need for them. In my judgment it is artificial to describe those sporadic requests and receipts as a one-off part of an accruing profit share entitlement in the year in question. It makes more sense to describe them as occasional requests for payment of undrawn profits. Accordingly, I reject Robert's case based on a variation by conduct.
134. His next alternative was that in every year in which the partners signed accounts showing a single joint capital account entitlement, (that is after 1991), each of them thereby waived any right to claim undrawn profits as part of a separate capital entitlement, it being implicit in the settlement of a joint capital account that partners retain no rights as against each other to separate different amounts, rather than to equal shares of the single joint amount.
135. I recognise that, in an appropriate case, this may be the correct construction to place upon signed partnership accounts which contain a joint capital account statement. Mr Cowen's evidence was that, in his experience, the most common (albeit by no means the only) instance of joint capital accounts was to be found in partnerships between husband and wife. In such cases, and in particular where admissible background evidence shows that the spouses pooled their assets generally, such signed accounts may well reflect an agreement by them not to assert separate capital entitlements against each other, by reference for example to any disparity in their respective drawings. The question is whether this is the correct interpretation of the market partnership accounts after 1991.
136. The alternative construction is that joint capital account statements are merely silent as to the parties' mutual rights and liabilities on capital account, those rights and liabilities lying behind, but neither identified nor contradicted by those accounts. That construction would be consistent with, but by no means conclusively established by, the accountants' annual practice of calculating the joint capital account by reference to an aggregation of two separate accounts, one for Mr and Mrs Hopper and one for Robert and Lyn.
137. In addressing those alternative constructions, it needs to be borne in mind that partners' capital entitlements do not depend upon the preparation and signing of capital accounts, or any other accounts. They depend simply upon the express or implied terms of the contract of partnership. Where partners with equal profit shares draw unequal sums year by year, the ordinary inference is that undrawn profits accumulate to the credit of the partners concerned, whereas drawing in excess of profits give rise to a liability of the partners concerned. It matters not whether those credits or liabilities are treated in the accounts as current or capital account items, or whether the partners prepare or sign accounts at all.
138. In my judgment the second of the alternatives outlined above is to be preferred as the correct interpretation of the post 1991 market partnership signed accounts. My reasons follow. First, it is on the face of it curious that partners should regularly make different drawings from equal entitlements to profit shares with the intention thereby of waiving, year by year, any undrawn profit share entitlements. Mr Blackett-Ord suggested a possible fiscal motive for such prima facie odd conduct. By spreading the profit sharing entitlement equally, he suggested that the Hopper family availed themselves of their parents' possibly lower tax rates than those which would have applied if they had simply agreed profit shares which reflected Robert's much larger contribution to the management of the partnership business. Without a waiver of undrawn profit share entitlement, a large parental capital entitlement would have built up, with its own adverse fiscal consequences on the parents' death. The difficulty with that ingenious argument is that there is no evidence at all to suggest that this was what the family's accountants advised, still less that Mr and Mrs Hopper gave up a valuable entitlement pursuant to that advice.
139. My second reason for preferring the interpretation that the signed accounts were simply silent as to mutual capital entitlements is derived from a review of the whole of the family's partnership accounts, from the earliest surviving farm accounts until the last to be signed before Mr Hopper's death. Looked at historically, the accounts appear to have gone through a series of stages in which, in particular, capital account statements varied in an apparently haphazard manner from disclosing virtually nothing, to disclosing mutual entitlements in 1990 to 1991 and then reverting to their pre-1990 format. In my judgment these changes appear more likely to have been the consequence of changes in the attitude of the family's accountants towards the amount of detail needing to be disclosed in the signed accounts, rather than towards changes in the partners' mutual rights and liabilities.
140. I would add for completeness that if I were to be wrong in my construction of the post 1991 signed accounts, I would have concluded that they amounted to annual waivers of any entitlement to undrawn profits (in excess of 25% of the aggregate closing capital amount) only as the result of a serious error. There was no evidence that the partners themselves ever agreed to such annual waivers of accrued but undrawn profits, and the oral evidence of both Mrs Hopper and Robert demonstrated no perception on the part of either of them that this is what they had achieved by signing the annual accounts in the form presented to them by the family's accountants.
141. On my analysis, the only signed accounts of the market partnership which revealed the parties' rights and liabilities in relation to undrawn and overdrawn profits are those signed for the years 1990 and 1991. Undrawn profits were to be added to capital and payable, in the absence of any prior demand, upon dissolution. The subsequent accounts were merely silent as to that continuing entitlement thereafter, but did not contradict it.
142. Robert's final defence to his mother's claim was based upon limitation. Mr Blackett-Ord submitted that her claim was, in substance, a claim for an account of monies due pursuant to the contract of partnership, so that pursuant to sections 5 and 23 of the Limitation Act 1980, they were subject to a six year limitation period. I disagree. In my judgment the correct analysis is as follows. First, no limitation period runs in relation to a claim by a partner for undrawn profits which have been added to capital for as long as the partnership endures. Time runs only from the dissolution of that partnership or, if earlier, from any demand for payment: see Lindley & Banks on Partnership (18^th Ed) paragraphs 23-32 at 33 and Blackett-Ord on Partnership Law (3^rd Ed) at paragraphs 15.50 to 15.51.
143. Secondly, as I have concluded, Mr and Mrs Hopper's undrawn profits were, as a matter of contractual entitlement, added to their capital entitlement year by year even though, after 1991, this was not expressly so stated in the signed accounts. In every year the joint capital account statement continued to reflect the aggregate of an ever increasing credit for Mr and Mrs Hopper, and an ever increasing overdrawn debit for Robert and Lyn. The accounts were not therefore inconsistent with the parties' mutual contractual rights and liabilities.
144. Thirdly, it is common ground that neither Mr nor Mrs Hopper demanded their undrawn profits, save on the occasions when they demanded and received occasional lump sum payments, all of which were duly accounted for in the accountants' working papers, and therefore reflected as part of the drawings in the signed accounts.
145. Fourthly, if I had concluded that as a matter of construction the post 1991 signed accounts amounted to waivers of continuing rights to undrawn profits, and that this had therefore arisen as the result of a mistake, the relevant limitation period for any necessary reopening of those accounts would have been that prescribed by section 32(1)(c) of the Limitation Act 1980, namely six years from the date when Mr and Mrs Hopper either discovered the mistake, or could with reasonable diligence have discovered it: see Phillips- Higgins v.Harper [1954] 1 QB 411 at 418, per Pearson J. Since during the whole of the relevant period Robert was in charge of relations between the market partnership and its accountants, I see no particular reason why time should, on a reasonable diligence basis, have started to run against Mr and Mrs Hopper any earlier than Mrs Hopper's actual discovery of the true position, as illustrated by the Terri Schedule, after her husband's death.
146. Finally, there is in my judgment no room for the doctrine of laches. This is not a case where statute provides no period of limitation, leaving a gap in which laches may bar an equitable remedy. Here there are applicable six year statutory periods, both in relation to the claim for undrawn profits and to the re-opening of the settled accounts. Both periods started to run less than six years before the claims were brought. No reason was advanced why, if not statute barred, Mrs Hopper should have the residual discretion to bar an equitable claim exercised against her, on the ground of long delay causing prejudice to Robert and Lyn. In particular, for the whole of the period when Mrs Hopper and her late husband allowed their undrawn profits to accumulate in the market partnership, Robert was in sole managerial control of it. If he chose to draw in excess of his own profit share during that period, he can have no complaint of prejudice in having to replace the excess, now that the market partnership has been dissolved.
147. It therefore follows that Robert's last line of defence to his mother's capital entitlement claim also fails, so that issues (2), (3) and (5) fall to be determined as follows. As to issue (2), Mr and Mrs Hopper ought to be treated as having a separate capital entitlement (jointly as between them) in the market partnership. As to issue (3), Mr and Mrs Hopper are entitled to the balance of their 25% profit share in respect of every accounting year of the market partnership, back to 1989. As to issue (5), the payments of £300 per week made by Robert to his parents were, until Mr Hopper's death, simply drawings on account of his parents' profit share entitlement. I will deal with the effect of issues (2), (3) and (5) upon the period after Mr Hopper's death after dealing with issues (1) and (4).
148. Issue (1) relates to both the market and farm partnerships. I will deal with the market partnership first. I have briefly outlined how, following Mr Hopper's death, the market business was continued by Robert exactly as it had been conducted previously. The only evidence that this occurred by agreement among all the partners is to be found in the terms of the 2004 signed partnership accounts. Those accounts say nothing of the deliberate creation of a new partnership, but rather of the continuation of the business of the firm which dissolved upon Mr Hopper's death in which Mrs Hopper was declared to be a 25% profit sharer as her late husband's executor.
149. Mr Mawhinney submitted on behalf of Mrs Hopper that an agreement to form a new partnership should be inferred from those facts because the market business was continued rather than wound up, entering into new contracts beyond those necessary merely for a beneficial winding up, for a period during which the parties continued to authorise Robert to do so as manager, and in respect of which accounts continued to be drawn and books of account kept. Mr Mawhinney submitted that the creation of a new partnership was the inevitable inference to be drawn from those facts.
150. In my judgment, those facts support only an inference that Robert was authorised to continue the business of the market partnership in dissolution, without an immediate winding up. That authorisation was by way of extension to the limited authority conferred by section 38 of the Partnership Act 1890, but it did not constitute the establishment of a new partnership. I reach that conclusion for three reasons. First, Mrs Hopper's signature of the 2004 partnership accounts as executor, rather than as the inheritor of her late husband's share points away from the creation of a new partnership, which is something prima facie outwith the duties or functions of an executor. Secondly, accounts for the first year of a newly created partnership would normally contain entries reflecting the winding up of the old firm and the introduction of its net assets by way of a capital contribution to the assets of the new firm. By contrast, the 2004 accounts appear to reflect a mere continuation of the business of the old firm. Thirdly, the notion that the parties entered into a new partnership belies the reality. The business of the old firm was simply continued by Robert with Lyn's and Mrs Hopper's authority while the parties faced up to the consequences of Mr Hopper's death, but in the absence of any wider agreement as to those consequences.
151. The position is even clearer in relation to the farm partnership after Mr Hopper's death. The business began to be wound down by the conversion of acreage from market gardening to grass, and by the letting of the farm shop. In those circumstances, although the point was hardly touched on in submissions, I consider it plain that no new farm partnership was established.
152. Issue (4) relates only to the market partnership. On the footing that no new partnership was created, it is common ground that section 42 of the Partnership Act 1890 was, in the absence of any agreement to the contrary, triggered by Mr Hopper's death, and by the carrying on of the firm by the surviving or continuing partners with its capital or assets without any final settlement of accounts as between the firm and Mr Hopper's estate. The question raised by issue (4) is whether Mrs Hopper was an "outgoing partner" for the purposes of the quantification of her post-dissolution rights. The reason why Robert has raised this issue is because he wishes to argue at a later stage in the partnership proceedings that each of Mr and Mrs Hopper's share of profits should be less than 25% because little of any of the post-dissolution profits of the market business are attributable to Robert's use of his parents' shares of the partnership assets.
153. I have found it difficult to treat this issue as of any significance in the resolution of the partnership proceedings, because it seems to me that the signature by Robert, Lyn and Mrs Hopper of the 2004 partnership accounts discloses the clearest possible "agreement to the contrary" within the meaning of section 42(1), displacing the default provisions there set out. Those accounts unmistakably provided that the continuing profit shares should be 25% for Robert, Lyn and Mrs Hopper (in her own right) and 25% for Mr Hopper's estate. Furthermore, those accounts show that the ongoing business was carried on by Robert with both Lyn's and Mrs Hopper's authority. The question whether Mrs Hopper should therefore be regarded as an outgoing partner within the meaning of section 42(1) is in my judgment purely academic. It is nonetheless an interesting question of construction to which the parties pressed me to provide an answer, apparently on the assumption that, however academic, it might be relevant to the question of costs.
154. For what it is worth, my analysis of issue (4) is as follows. Where, as here, a partnership is dissolved by the death of one of its members, the question whether any other partner is to be treated, on the one hand as a "surviving or continuing partner" or on the other hand as an "outgoing partner" depends in relation to each such partner whether he or she was party to the carrying on of the business of the firm with its capital or assets without any final settlement of accounts. In a two partner firm dissolved by the death by one of them, no problem arises. In a firm of more than two partners, the business of the firm may be carried on by one or more of the survivors. If all of them carry it on, then section 42 applies to regulate the mutual rights of the deceased partner's estate against all the surviving partners. On the other hand, if following the dissolution caused by a death of one of the partners, only some of the others carry on the business, then the partner or partners who do not may qualify, alongside the estate of the deceased, as outgoing partners for the purposes of claims under section 42(1).
155. In the present case, by signing the 2004 accounts, Mrs Hopper became (albeit possibly retrospectively) a party to the carrying on of the business of the firm following her husband's death. She probably acquired that status as soon as she continued to accept her weekly receipts of £300. She did not therefore become an 'outgoing partner' within the meaning of section 42(1) upon her husband's death. On the contrary, she was a surviving partner of a dissolved, but as yet not wound up partnership, as between which and her husband's estate there has yet to be any final settlement of accounts. For the reasons which I have already given, the practical effect of section 42(1) has been displaced by an agreement to the contrary, namely that pending that final winding up, the continuing profits of the market partnership are to be divided in the same shares as those which subsisted before Mr Hopper's death.
156. As for issues (2), (3) and (5) in the period post-dissolution, they should be determined as follows. Mrs Hopper and her husband's estate continued to have the same 50% combined capital entitlement in respect of the period after Mr Hopper's death as before it. They continued to be entitled each to the balance after drawings of a 25% profit share. Mrs Hopper's continued receipt of £300 per week was by way of drawings on account of an agreed profit share to which she and her late husband's estate were jointly entitled, pending a final winding up of the affairs of the market partnership.
157. I will hear submissions as to case management directions in relation to the remaining issues in the partnership action.