Can an unfulfilled promise be upheld? Kramer v Stone [2024] HCA 48

Dame Leonie Kramer was a distinguished Australian academic, notably serving as the first female Chancellor of the University of Sydney, among many other accomplishments. Her husband, Dr. Harry Kramer, passed away in 1988, and Dame Leonie died in 2016 at the age of 91.

Facts:

  • In 1969, Dame Leonie and her husband purchased a 100-acre farm near the Colo River, not far from Sydney.
  • The farm’s previous owner had entered into a share farming agreement with David Stone’s father, allowing him to work on the property starting in 1965.
  • After the Kramers’ bought the farm, this agreement continued. In 1974, when David Stone’s father left, David himself took over working the farm.
  • After her husband’s death in 1988, Dame Leonie promised Mr. Stone that she would leave the farm to him in her will.
  • Relying on this promise, Mr. Stone continued to live and work on the farm for the next 23 years. Despite opportunities to work elsewhere and potentially earn more, he chose to stay.
  • Upon Dame Leonie’s death in 2016, her will did not fulfill the promise made to Mr. Stone. Instead, she left the farm to one of her daughters and bequeathed $200,000 to Mr. Stone.
  • Mr. Stone then sued the executors of Dame Leonie’s estate in the NSW Supreme Court, seeking to enforce her promise. He won the case.
  • Unhappy with the result, Dame Leonie’s executor appealed to overturn the decision in the Court of Appeal and lost. The final avenue of appeal was the High Court of Australia.

Issue:

The central issue was whether Dame Leonie’s promise to Mr. Stone to inherit the farm upon her death should be upheld.

Decision:

The High Court ruled in favour of Mr. Stone. He will receive the farm, irrespective of the terms of Dame Leonie’s will. The Court determined that Mr. Stone relied on Dame Leonie’s 1988 promise, stayed and worked on the farm for another 23 years.  He could have earned more elsewhere so staying was to his detriment.

Takeaway Points:

A claim such as this (equitable estoppel by encouragement) can be made where:

  1. A party makes a single representation (promise) to another, which is relied upon by that person to their detriment, and
  2. The reliance on that promise is reasonable and foreseeable, even if there are no further actions of encouragement or knowledge of the party’s actual reliance.

The full case can be accessed here: Kramer v Stone [2024] HCA 48

Note:  This is not intended to be legal advice and cannot be relied upon as such.