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This tradition began based on the story in that in 1158 a crowd of locals was pursuing a wild boar, which took to hide in a holy man is caught. During the pursuit of the wild boar and accident took place which caused a hermit to be wounded.
The poor hermit lay dying, while driving's last breaths ordered the crowd that had been pursuing him to undertake an annual task which had to be supervised by the Abbot with the purpose of showing their repentance.
According to certain accounts this ceremony originally called Horn, was undertaken by some of the tenants of the Abbey which formed part of their obligation as rental tenants during the 14th century. These tenants would at the crack of dawn whilst being directed by the Abbot's bailiff cut the necessary timber under the direction of the Abbot's bailiff, and then carry the woo on a particular route down to the water's edge and proceed to build the hedge, which had to stand for the three tides. For many centuries the Chorley’s stewards and the local people of the town would carry on with this tradition which still takes place today.
It is very probable that the original story of the hermit was just an invention by Whitby Abbey to reinforce its authority, but that still does not form any kind of explanation for the actual ceremony. There is a possibility that even going back to the 14th century the original meaning of the ceremony was long since forgotten and so the true meaning of the Penny Hedge might never really be known.
It was established that the ceremony definitely dated back as far as the foundation of the Abbey, this was found out due to the research done by the Canon Atkinson who was a local historian. His theory was that the Horngarth related to buildings and fences which were there to stop horned cattle damaging the crops, but this is not thought to be a very accurate explanation, because if this ceremony started with something which was an everyday useful function, why would it become something so unusual with apparently no real usefulness?
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There was another historian called Robert Turton and is idea was that the Penny Hedge could have been connected to a folk memory of formal of fencing which was there to help round up and help slaughter horned stock, but once again that is unlikely because it doesn't make sense to slaughter livestock in May because they would still have not developed meat from the from the hardships of winter and would still be on the thin side.
So the reality is that the ceremony Penny Hedge really isn't fully understood at all beyond the theories and why the words “Out on Ye” are shouted three times nobody really knows. We'll just have to accept that this ceremony as an obscure meaning that goes back to very ancient times many hundreds of years ago.