An ‘equitable estoppel argument’ is a legal term covering a promise made by one family member to another about ultimate inheritance of a family business or rural property.

This is a growing area of the law, with many more cases coming before senior state courts in recent years. One case in particular, Browne v Browne, raised important points around business succession in family enterprises, especially given the dispute around earlier representations by the senior Browne in relation to eventual inheritance.

The court held that the father should be held to his promises and that legal title to property be transferred.

Lessons from the Browne case include the need for clear and explicit arrangements to be made with children and other family members about both working relationships and ultimate transfer of ownership and/or succession of all business structures.

Such businesses are often complex in their historical make-up, and include trusts and companies. It is often wise to seek advice and to possibly consider a family agreement or constitution as a first step.

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