Over the past week, you would have come across various news articles about a Sydney couple who inherit a $40million estate from their neighbour. You have even wondered, how on earth?
On 23 October 2020, Her Honour Chief Justice Ward of the Supreme Court of New South Wales delivered the decision of Moore v Aubusson  NSWSC 1466.
The legal principle behind this decision is the doctrine of equitable estoppel. Say what?
What is the doctrine of equitable estoppel?
This is a doctrine in equity. Equity is a branch of law that we inherit from the Court of Chancery, which exists side by side with our common law system to ensure that there would be, well you guess it, fairness and equity.
Equitable estoppel is, in essence, this:
- A promises B something, on the basis that B would do something else in exchange.
- B then, in reliance to the promise, then does what is required of B.
- A then does not keep the promises to B
- B can rely on equitable estoppel to enforce A’s promise.
In this case, we have a couple who were neighbours of the deceased (Mrs Murphy) from the early 2000s. The couple and Mrs Murphy developed a close relationship. In 2002, Mrs Murphy’s husband died. Mrs Murphy and her husband had no children, and Mrs Murphy’s siblings were all older than her and they were in no position to look after her as she aged.
The neighbours, Mr Moore and Ms Andreason, alleged that Mrs Murphy made an arrangement with them in late 2004 to the effect that they would look after her as she grew older, and in return, Mrs Murphy would “look after them” in her Will.
The neighbours said that the promise was for the entirety of Mrs Murphy’s estate. They also said that the promise included that they would not undertake the renovations that they had planned to undertake on their property (as an investment strategy) to the extent that this would block out Mrs Murphy’s water views, and that they would not move away.
The neighbours looked after Mrs Murphy until her death in 2015. They were then notified that they were left with a legacy of $25,000, and that the remainder of the estate would be given to Mrs Murphy’s siblings.
The Court found that the understanding between Mrs Murphy and her neighbours did not reach the level of a contract. However, the Court found that there was a promise by Mrs Murphy to her neighbours in respect of her two waterfront properties in Birchgrove (and not the entirety of the estate).
It was also held that the neighbours’ care and support to Mrs Murphy over the years, at the expense of their own commitments, was sufficient to constitute detrimental reliance on Mrs Murphy’s promise. The Court ordered that the two water-front properties be transferred to the neighbours within 28 days of the Order, and that the siblings will get the remaining $11M of other assets in the estate.