LEGAL PRINCIPLE: EQUITY – Proprietary Estoppel – Expenditure on Land of Another – Expectation Induced by Owner – Protection of Equity
PRINCIPLE STATEMENT
Where a person has expended money on the land of another in the expectation, induced or encouraged, by the owner of the land that he would be allowed to remain in occupation thereof, an equity is created such that the court would protect his occupation of the land and the court has power to determine in what way the equity so arising could be satisfied. All that is necessary is that the licensee should at the request or with the encouragement of the landlord have spent the money in the expectation of being allowed to stay there. If so, the court will not allow the expectation to be defeated where it will be inequitable to do so.
RATIO DECIDENDI (SOURCE)
Per Iguh, JSC, in Okechukwu v. Onuorah (2000) NLC-2481993(SC) at p. 12; Paras B–E.
"Where a person has expended money on the land of another in the expectation, induced or encouraged, by the owner of the land that he would be allowed to remain in occupation thereof, an equity is created such that the court would protect his occupation of the land and the court has power to determine in what way the equity so arising could be satisfied. All that is necessary is that the licensee should at the request or with the encouragement of the landlord have spent the money in the expectation of being allowed to stay there. If so, the court will not allow the expectation to be defeated where it will be inequitable to do so."
EXPLANATION / SCOPE
Proprietary estoppel arises where a person expends money on another’s land induced by the owner’s encouragement or representation that they may remain. This creates an equity that courts protect. The critical elements are: (1) expenditure; (2) induced by owner’s encouragement; (3) expectation of remaining. The court may satisfy the equity in various ways—by granting a license, lease, or other relief. The doctrine prevents injustice by preventing the owner from defeating the reasonable expectation they created. It is a flexible equitable remedy.