Revocability
Nature of Licence
A licence is a permission, usually under a contract by which a person with title to or possession of property, permits another to occupy or use it. It may be a “bare” permission without any contract. In one sense, a licence is simply permission to do that which would otherwise constitute a trespass.
Most licences have a contractual basis. A contract for a licence may contain a term that it is not revocable.
A licence need not be contractual. It may be a bare consent. In this case, it would be revocable, unless principles of equitable estoppel arise.
Estoppel Based Remedies
A contract for the use of land, does not create an interest in land in itself. This arises from the fact that it is personal in nature and cannot be enforced against third parties.
In the last 50 years the concept of a licence which may be enforceable by injunction, has emerged. In such cases, the licence assumes some or many of the characteristics of an interest in property.
As under contract law generally, a licensor as a party to a contract, may be estopped from revoking the licence. Estoppel is an equitable remedy. See the sections on proprietary estoppel and promissory estoppel.
In the context of proprietary interests, estoppel has a wider remit. Unlike so-called promissory estoppel, proprietary estoppel may be a basis for a claim or cause of action.
Availability of Injunction
A question may arise as to whether the licence is revocable or irrevocable, by the terms of the relevant contract. This is ultimately a matter of interpretation in the circumstances. Where it is irrevocable, whether expressly or impliedly, an injunction may be granted in certain cases to enforce it.
The courts have been willing in some cases, where justice so required, to effectively grant long-term occupational rights, whereby another party, generally the land owner, is estopped from revoking the licence, on the basis of the other party having acted to his detriment in reliance on its existence.
Where an injunction is available to enforce a licence, it has a proprietary effect. That is, it holds good against all or most persons.
Prior to the merger of common law and equity, the only remedy for breach of a contractual right (including a licence) was an award of damages. In the middle of the 19th century, the common law courts were given power to grant injunctions.
Proprietary Estoppel
If a stranger begins to build on land which he believes to be his, and the real owner, seeing and appreciating the mistake, abstains from correcting it, and encourages or induces the stranger to continue, then equity may not allow him to assert his title to the land. However, if the stranger knows it to be a land of the other, equity will not prevent the real owner from reclaiming the land.
In former years, the courts held that an estoppel might effectively give title, by preventing the true owner from taking legal action for a period or indefinitely. If the equity so required, the true owner might be precluded from taking action for ever.
In more recent years, the courts have been willing to require a transfer of the property, where circumstances justify indefinite estoppel. The Irish courts have shown themselves willing to use equitable estoppel in order to make a licence tailored to effect fairness between the parties.
Domestic Examples
The members of the owner’s household, are licensees only, in the absence of any proprietary interest. In some circumstances, the home owner may be precluded from revoking that licence. Family law now provides statutory protections for others in the household.
There have been many cases in Ireland where a person often a relative has been induced to give up employment, property or to forego opportunities to look after a landowner on foot on an assurance that something, usually the land would be left to them by will. Where this promise was not kept, the courts have been willing to give effect to the promises under the principles of estoppel.
Licence Coupled with an Interest
A licence which is coupled with an interest may be irrevocable. This is most commonly found in the case of a licence accompanied by a profit a prendre. The purpose is to prevent the licensor from derogating from his grant.
In the case of a profit, where there is a right to enter land and take particular things from the land under an agreement, the licence to enter may be restrained from revocation, for so long as the right granted subsists.
Contractual Issues
It is a matter of interpretation of the grant as to whether the licence is, or is not revocable. A licence might contain an express or implied term that it cannot be revoked until its purpose has been satisfied.
It is necessary that revocation is inconsistent with the terms of the licence, subject to the possibility of relief against forfeiture, where required. It is a question of interpretation as to whether a licence is revocable for breach.
In some cases, the courts may be willing to grant an injunction to uphold and specifically enforce the licence / contract. In these cases, the licence effectively becomes irrevocable and obtains some of the characteristics of property.
Equitable relief may be given where the licensee pays up arrears or remedies a breach. This is analogous to the principle of relief of tenants against forfeiture.
Remedies for Breach
A person may revoke a licence, but may be subject to the remedy of damages for breach of contract only, rather than injunction. In other cases, an injunction may be available. In practice it may be difficult to obtain an injunction in circumstances where the licence relates to a temporary stay on premises.
Where the subject matter of the licence has greater permanence, so that it is possible in principle to apply for an injunction before action could be taken to remove it, the licence may have greater capacity for enforceability.
A licence which is coupled with an interest is more likely to be protected by injunction. In some categories of case, a licence may be protected by injunction, notwithstanding that it is not accompanied by an interest.