Proprietary Estoppel & Harbour Views

Birchgrove is a Sydney Harbourside suburb; David Moore and Douwine Andreasen owned and were living in 100 Louisa Road Birchgrove (“No 100”). They met the deceased, Barbara Murphy, who owned 66 & 68 Louisa Road before moving into 70 Louisa Road (“No 70”) in 1999. David and Douwine had bought No. 70 “the worst house in the best street” for re-development and sale for profit in order to better plan and provide financially for their retirement. After David and Douwine moved to No 70 in 2001 they developed a close relationship with Barbara.

In the context of the Sydney real estate market, there is a perceived advantage of Sydney Harbour water views. Barbara’s two properties each comprised two units; she occupied the upstairs unit at No 68 and rented out the remaining three units. Numbers 66-70 Louisa Road extend down to the Harbour. Relevantly, Barbara’s unit at No 68 had views of Sydney Harbour, that she was keen to retain. 

David and Douwine’s proposed development of No 70 included a similar extension to that being undertaken by the owners of No 72 Louisa Road (“No 72”). Barbara was unhappy with the works carried out to No 72; lodging objections with the Leichhardt Council and attempting to enter the site to check its compliance with the approved plans. 

Barbara raised her concerns with David and Douwine that their development at No 70 would block her views. Claiming that Barbara promised to leave them her whole estate in return for them agreeing not to undertake renovations that would restrict the view from her property and looking after her for the rest of her life. David and Douwine agreed and took care of Barbara and didn’t renovate the property; however, Barbara did not leave her estate to them under her Will.

Proprietary Estoppel

David and Douwine sought a declaration from the Court that the executor holds the whole of Barbara’s estate on trust for them in equal shares as tenants in common, and an order that the estate be transferred to them.

Proprietary estoppel is an equitable doctrine that applies where a person (A) induces another (B) to adopt an assumption or expectation that they have or will obtain an interest in A’s property, and based on this assumption B alters their position or acts to their detriment.

The Court was satisfied David and Douwine met the elements of proprietary estoppel as they had suffered a detriment due to their reliance on Barbara’s promise.

However, the claim for the entire deceased’s estate, valued at over $12 million, was out all proportion with the detriment they claim to have suffered in “looking after” Barbara and not blocking her views; making a declaration that the executor holds the properties known as No 66 and No 68 Louisa Road, Birchgrove on trust for David and Douwine in equal shares as tenants in common.

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