Term
| What purpose does Promissery Estoppel serve? |
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Definition
| It acts as an exception to the rule that part-payment of a debt without fresh consideration does not discharge the debt obligation. |
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Term
| From what case is the modern doctrine of promissery estoppel DERIVED? |
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Definition
| Hughes v Metropolitan Railway Co. [1877] |
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Term
| Hughes v Metropolitan Railway Co. [1877] |
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Definition
THE CASE FROM WHICH PROMISSERY ESTOPPEL IS DERIVED
IF PARTIES WILLINGLY AGREE THAT STRICT RIGHTS ARISING UNDER A CONTRACT WILL NOT BE ENFORCED, OR WILL BE KEPT IN SUSPENSE, THE PERSON WHO HAS AGREED TO NOT ENFORCE THE OBLIGATIONS, MAY NOT ENFORCE THE OBLIGATIONS IF IT WOULD BE INEQUITABLE TO DO SO.
C's lease required that he kept the Landlord's (D) premises in good repair
D identified some damage and gave C 6-months to remedy it
1 month later, C & D began discussions about C buying the lease from the D
C stated that whilst the negotiations were ongoing, he would not undertake the repairs (implied acceptance by D)
At a later date, the negotiations broke down
The D then sought the C's forefiture of the property on the basis that they had failed to undertake the repairs
HELD - the landlord's conduct was an implied promise to the tenant that he would not enforce the forfeiture at the end of the 6-month period, and in not doing the repairs, the tenant had been relying on this promise.
Thus, D was estopped from asserting the right to forefiture. |
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Term
| In which case (and by which judge) was the promissery estoppel doctrine formulated? |
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Definition
Central London Property Trust v High Trees House [1947]
Lord Denning |
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Term
| From which case was promissery estopel derived? And in which case was it formulated? |
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Definition
Hughes v Metropolitan Railway Co. [1877]
Central London Property Trust v High Trees House [1947] |
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Term
| W.r.t Denning's formulation of promissery estoppel in Central London Property Trust v High Trees House [1947] - what is the general legal opinion of it? |
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Definition
| Consensus of legal opinion is that Denning developed the original doctrine beyond its established parameters, HOWEVER, Denning's doctrine is now very much part of the English law of contract. |
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Term
| Central London Property Trust v High Trees House [1947] |
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Definition
FORMULATION OF PROMISSERY ESTOPPEL
Cs leased block of flats for Ds
WWII broke out
Ds experienced difficulty in leasing all of the flats
C agreed in 1940 to accept 1/2 of the rent due
Flats were fully let in late 1945
cs sought to return to the original terms of the agreement, and sought to claim the full rent both for the future and the last two quarters of 1945 (from where the flats had full occupancy)
HELD - the parties had intended the reduction in rent to be a temporary measure while the flats could not be fully let. From whence they were fully let, the C was due the full rent.
HAD THE C TRIED TO CLAIM THE FULL RENT FOR 1940-1945, THEIR CLAIM WOULD HAVE FAILED, EVEN THOUGH THERE WAS NO CONSIDERATION FOR THE PROMISE TO ACCEPT REDUCED RENT. |
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Term
| What was the equitable maxim relied on by Denning in formulating his judgement in Central London Property Trust v High Trees House [1947] |
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Definition
| A PROMISE INTENDED TO BE BINDING AND INTENDED TO BE ACTED ON AND IN FACT ACTED ON, IS BINDING SO FAR AS ITS TERMS PROPERLY APPLY |
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Term
| How have the courts tried to overcome the conflict between the judgements in Foakes v Beer and the High Trees House case? |
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Definition
| 'acute judicial keenness to constrain promissery estoppel within strict parameters' e.g. only applicable where strict tests have been met |
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Term
| Why did Foakes v Beer [1884] not follow the judgement in Hughes v Metropolitan [1877] |
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Definition
| Dealing with two seperate issues - one concerned breach of contract terms, the other dealt with part payment of a debt. |
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Term
| What are the two legal concepts that can be used to justify the application of promissery estoppel in certain circumstances? |
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Definition
1) Fusion of the law and equity
2) Intention to be legally bound (or lack of) |
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Term
| What are 5 the elements of promissery estoppel? |
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Definition
1) Used as a shield not a sword
2) There must be a clear and unequivocal promise
3) The debtor/promisee must have relied upon the promise
4) Reliance need not be to the promisee's detriment
5)It must be UNCONSCIONABLE (inequitable) for the promisor to go back on his promise |
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Term
| Which case confirms that promissery estoppel can only act as a defence to an action, and cannot be used as a cause of action? |
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Definition
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Term
| What does 'A shield and not a sword' mean? |
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Definition
| Promissery estoppel can only be used as a defence to an action and not a cause for an action. |
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Term
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Definition
PROMISSERY ESTOPPEL CAN ONLY BE USED AS A SHIELD AND NOT A SWORD
D(ex-husband) had promised to pay ex-wife (C)£100 per year.
However, the D did not make any of the agreed payments
Despite this, there had been reliance by the C on the D's promise
C then brought an action for D's failure to pay
HELD - PROMISSERY ESTOPPEL IS A SHIELD NOT A SWORD
PROMISSERY ESTOPPEL DOES NOT CREATE A NEW CAUSE OF ACTION
EXTENDING PROMISSERY ESTOPPEL TO BE A SWORD WOULD OPEN THE FLOODGATES & ALLOW FOR THE ENFORCEABILITY OF ALL PROMISES SANS CONSIDERATION |
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Term
| Which two cases firmly entrench the decision in Combe v Combe [1951] |
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Definition
Baird Textile Holdings Ltd. v Marks & Spencer plc [2001]
Smithkline Beecham plc v Apotex Europe Ltd [2006] |
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Term
What do the following two cases confirm...
Baird Textile Holdings Ltd. v Marks & Spencer plc [2001]
Smithkline Beecham plc v Apotex Europe Ltd [2006] |
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Definition
| Confirm the judgement in Combe v Combe [1951] - that promissery estoppel can only be used as a shield and NOT a sword. |
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Term
| What does the PE condition that 'there must be a clear and unequivocal promise' require? |
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Definition
1) Clear intention that existing legal rights will not be enforced
2) The promise must be intended to affect legal relations and not simply amount to a gratuitous privilege
3) The promise can be implied, but it must still be clear and unequivocal |
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Term
| What are 5 the elements of promissery estoppel? |
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Definition
1) Used as a shield not a sword
2) There must be a clear and unequivocal promise
3) The debtor/promisee must have relied upon the promise
4) Reliance need not be to the promisee's detriment
5)It must be UNCONSCIONABLE (inequitable) for the promisor to go back on his promise |
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Term
| What are 5 the elements of promissery estoppel? |
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Definition
1) Used as a shield not a sword
2) There must be a clear and unequivocal promise
3) The debtor/promisee must have relied upon the promise
4) Reliance need not be to the promisee's detriment
5)It must be UNCONSCIONABLE (inequitable) for the promisor to go back on his promise |
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Term
| What are 5 the elements of promissery estoppel? |
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Definition
1) Used as a shield not a sword
2) There must be a clear and unequivocal promise
3) The debtor/promisee must have relied upon the promise
4) Reliance need not be to the promisee's detriment
5)It must be UNCONSCIONABLE (inequitable) for the promisor to go back on his promise |
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Term
| What are 5 the elements of promissery estoppel? |
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Definition
1) Used as a shield not a sword
2) There must be a clear and unequivocal promise
3) The debtor/promisee must have relied upon the promise
4) Reliance need not be to the promisee's detriment
5)It must be UNCONSCIONABLE (inequitable) for the promisor to go back on his promise |
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Term
| Which case confirms that the promise (in PE) can be implied? |
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Definition
Hughes v Metropolitan Railway Co. [1877]
(the promisee stated that he wouldn't conduct the repairs - the landlord acceeded through conduct) |
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Term
| Which case can be used to show that for PE, the promise must be clear and unequivoval? |
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Definition
| Woodhouse A.C. Israel Cocoa Ltd. S.A. and Another v Nigerian Produce Marketing Co. Ltd [1972] |
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Term
| Woodhouse A.C. Israel Cocoa Ltd. S.A. and Another v Nigerian Produce Marketing Co. Ltd [1972] |
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Definition
THE PROMISE IN A PE MUST BE CLEAR AND UNEQUIVOCAL - READILY UNDERSTANDABLE IN THE SENSE REQUIRED
AN AMBIGUOUS PROMISE CANNOT FOUND A PE
C was due to buy something from D - contractr stated payment was to be in £Nigerian
C asked D if they would be prepared to accept £sterling
Ds said they could pay in either way
subsequently, the value of £sterling depreciated
Cs argued that the D's letter = a representation that they could make payment on the basis of 1£sterling to 1£N
HELD - the seller's representation was not sufficiently precise therefore = NO promissery estoppel |
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Term
| What does 'The debtor/promisee must have relied upon the promise' require? |
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Definition
| The promise must have altered / influenced the promisee's conduct in some way |
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Term
| Which case confirms that 'the promisee must have relied upon the promise'? |
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Definition
| Emmanuel Ayodeji v R.T. Briscoe (Nigeria) Ltd. [1964] |
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Term
| Emmanuel Ayodeji v R.T. Briscoe (Nigeria) Ltd. [1964] |
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Definition
THE PROMISEE MUST HAVE RELIED ON THE PROMISE AND THEIR CONDUCT MUST HAVE BEEN INFLUENCED BY IT
D hired 11 lorries from the C - to be paid for by monthly installments
D contacted C to say that 8 of the lorries were out of service, needed repair, and he would contribute to the cost of repair
C replied saying that for the period that the lorries were out of service, the D did not have to pay installments.
However, the C later sued for the recovery of installments due
HELD - the D had not relied upon the C's promise, therefore he could not use promissery estoppel. |
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Term
| IN THE CASE OF Emmanuel Ayodeji v R.T. Briscoe (Nigeria) Ltd. [1964] - WHY DID THE COURTS FIND THAT THE D HADN'T RELIED UPON THE C'S PROMISE? |
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Definition
1) D contended that he had acted in reliance on the promise, in that after it was made, he did not try to bargain with the C on the basis of the promise - court held that this was not sufficient 'the D did not alter his position by not putting forward counter-proposals' (alteration must be real and actual)
2) Business was re-organised because lorries were out of service, BUT... this would have been the case regardless of the promise (D failed to prove that any reorganising had been specifically influenced by the promise) |
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Term
| Need the promise be the only reason that the promisee changed his conduct? |
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Definition
| NO - however, it MUST have influenced the promisee's conduct in some way. |
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Term
| Brikom Investments v Carr [1979] |
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Definition
| WHERE THE PROMISEE HAS, AFTER THE PROMISE, CONDUCTED HIMSELF IN THE WAY INTENDED BY THE PROMISOR, IT WILL BE UP TO THE PROMISOR TO ESTABLISH THAT THE CONDUCT WAS NOT INDUCED BY THE PROMISE. |
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Term
| w.r.t the requirement that the promisee must act in reliance upon the promise - what controversy has the case of Collier v P & MJ Wright (Holdings) Ltd [2007] created? |
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Definition
| In this case, Arden L.J held that, where a promisor (creditor) agrees to accept part-payment, the reliance of the debtor arises where he relies on the promise that he can part-pay - e.g. this is sufficient reliance. This appears to dispense with the requirement that the promisee must demonstrate genuine reliance. (e.g. in his proceeding actions, not just the direct reliance on the promise that he can part-pay) |
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Term
| Collier v P & MJ Wright (Holdings) Ltd [2007] (DISPUTED) |
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Definition
RELIANCE ON THE PROMISE THAT PROMISEE CAN PART PAY IS SUFFICIENT RELIANCE
e.g. by part-paying, the promisee has acted in reliance on the promise
(DISPUTED) |
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Term
| In the exam, how can I discuss the case of Collier v P & MJ Wright (Holdings) Ltd [2007] |
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Definition
1) Identify the rule that emanates from it
2) Highlight that it appears to heavily undermine the reliance requirement
3) Critiques...
4) = CA case, NOT HoL
5) Alexander Trukhtanov (2008) - critique |
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Term
| Alexander Trukhtanov (2008) - CRITIQUE OF Collier v P & MJ Wright (Holdings) Ltd [2007] RULING |
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Definition
| 'Makes redundent any element of meaningful reliance, and and forces the equitable doctrine to operate as an automatic consequence of an offer and acceptance' |
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Term
| Must the promisee's alteration of position in reliance on the promise be to his detriment? |
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Definition
| NO - the promisee need not act to his detriment. HOWEVER, if the promisee has acted to his detriment, it may be easier to establish that it is inequitable for the promisor to go back on his promise. |
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Term
| W.r.t whether the promisee must act to his detriment, why is Emmanuel Ayodeji v R.T. Briscoe (Nigeria) Ltd. [1964] relevant? |
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Definition
| In this case, it was held that the promisee MUST act to his detriment. However, this has since been overturned in Alan (W.J) & Co v El Naser Export & Import Co. [1972] |
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Term
| Alan (W.J) & Co v El Naser Export & Import Co. [1972] |
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Definition
| THE PROMISEE, IN RELIANCE ON THE PROMISE, NEED NOT HAVE ACTED TO HIS DETRIMENT. |
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Term
| Why is 'The Post Chaser [1982]' relevant to the discussion of whether the promisee, in relying on the promise, acted to his detriment? |
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Definition
| In this case, Lord Goff stated that 'proof of acting to detriment is evidential as to the inequity of going back on a promise' |
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Term
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Definition
EVEN WHERE THE PROMISEE HAS ACTED IN RELIANCE, IT WILL NOT ALWAYS BE INEQUITABLE FOR THE PROMISOR TO GO BACK ON HIS PROMISE
WHERE THE PROMISEE, IN ACTING IN RELIANCE UPON THE PROMISE, HAS ACTED TO HIS DETRIMENT, IT WILL BE EASIER TO PROVE THAT IT WOULD BE INEQUITABLE FOR THE PROMISOR TO GO BACK ON HIS PROMISE |
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Term
| Who decides whether it would be inequitable for the promisor to go back on his promise? |
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Definition
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Term
| How is D&C Builders v Rees [1966] relevant to the discussion of the requirement that 'it must be inequitable for the promisor to go back on his promise'? |
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Definition
| BECAUSE THE PROMISE, THAT PART-PAYMENT WOULD BE ACCEPTED, WAS EXTRACTED UNDER DURESS. THEREFORE, IT WAS HELD THAT IT WOULD BE INEQUITABLE TO APPLY PROMISSERY ESTOPPEL IN THIS CASE. |
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Term
| Why is Emmanuel Ayodeji v Briscoe relevant to the discussion of thether PE suspends or extinguishes legal rights? |
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Definition
| In this case it was held that the promisor can revoke the PE upon giving reasonable notice |
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Term
| What is the general view on whether PE temporarily suspends, or permanently extinguished legal rights? |
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Definition
| The general view is that PE is only suspensory in its operation, barring exceptional cases where the promisee cannot resume his position |
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Term
| Alan (W.J.) & Co v El Nasar Export and Import Co. [1972] |
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Definition
DENNING - PE IS ONLY SUSPENSORY IN ITS OPERATION - UPON REASONABLE NOTICE, CREDITOR CAN REVOKE PROMISE.
BARRING EXCEPTIONAL CIRCUMSTANCES WHERE THE PROMISEE CANNOT RESUME HIS POSITION |
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Term
| Tool Metal Manufacturing Co. v Tungsten Co. [1955] |
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Definition
HOL - PE IS ONLY SUSPENSORY IN ITS OPERATION - UPON REASONABLE NOTICE, CREDITOR CAN REVOKE PROMISE.
BARRING EXCEPTIONAL CIRCUMSTANCES WHERE THE PROMISEE CANNOT RESUME HIS POSITION |
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Term
| Which three cases can be used to show the rule that PE is only suspensory in its operation? |
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Definition
1) HOL CASE - Tool Metal Manufacturing Co. v Tungsten Co. [1955]
2) DENNING CA - Alan (W.J.) & Co v El Nasar Export and Import Co. [1972]
3) Emmanuel Ayodeji v Briscoe |
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Term
| Given the general view that PE is only suspensory, how does this help to reconcile PE with the rules in Pinnel's Case & Folkes v Beer? |
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Definition
Folkes v Beer & Pinnels = Creditor can forego payment of the balance, but if he changes his mind, he is not estopped from then claiming the balance (ONLY ESTOPPED IF HE HAS RECEIVED CONSIDERATION)
PE = temporary suspension of rights, therefore, the debt is NOT written off, therefore creditor is not estopped from claiming the balance at a later date (PE PROMISE BECOMES BINDING WHERE DEBTOR ACTS IN RELIANCE, BUT NOT PERMANENTLY BINDING) |
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Term
| Which two cases can be used to show that whilst PE suspends (doesn't extinguish) legal rights, the creditor's legal right to payments affected by the PE is extinguished (e.g. payments which were reduced/missed whilst PE was active)? |
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Definition
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Term
| After PE has ended, does the creditor have an enforceable legal right to the payments that were missed/affected by the PE? |
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Definition
| NO - Hightrees, Tool Metal. |
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