What Is Promissory Estoppel

Proprietary estoppel, on the other hand, is a “legal bar preventing a (first) party from denying another (second) party's right in first party's property where the second party has incurred costs in that property to its detriment”. Proprietary estoppel, like other types of estoppel, is not a remedy in itself but a tool to raise “estoppel equity”, on the basis of which the court is able to decide on the type of remedy that this equity will satisfy. Similarly to the need for the element of common intention for the purpose of establishing a constructive trust, there is a need for the establishment of an active or passive assurance on the part of the defendant that leads to some form of consequential detriment on the part of the claimant when acting in reliance on that assurance. Thus, there must be a causal connection between the actions undertaken by the claimant and the initial assurance on the part of the defendant. The extent and the nature of the detriment suffered by the claimant, however, appears to be substantially more flexible than that necessary to find the existence of a constructive trust. For example, in Inwards v Baker [1965], such detriment amounted to the improvement of the defendant’s land, while in Gillett v Holt [2001] it was manifested in both financial and personal detriment. Yet unlike in most cases involving common intention constructive trusts, in neither of

In Kaye, this Court relied on comment a to § 295 of the Restatement (Second) of Contracts for the proposition that “[d]ischarge by release . . . has long been regarded as an executed transaction rather than an executory promise.” Kaye, 227 Md. App. at 682. Therefore, any right to maintain an action on the released obligation ceased at the time Lawrence Kaye gave the release. Likewise, in this case, “a lawsuit predicated on claims that have been [waived] cannot be actionable as a breach of contract, because a [waiver] is a unit of consideration that is tendered . . . immediately at the time of contracting.” Kaye, 227 Md. App. at 682.

The court ruled that the trial court’s grant of summary judgment was correct for the promissory estoppels claim. The plaintiff’s breach of contract claim case was remanded back to the lower court for further determination.

In Commercial Bank of Australia v Amadio 1, an elderly couple (Mr. and Mrs. Amadio) migrated to Australia forty year ago, without formal education and without a mastery of English, were persuaded by their son, Vincenzo to guarantee and mortgage to the bank a property they owned as security for the overdraft of their son’s company to the bank. They were misled into thinking that the liability was limited to $50000 and for half a year. When their son’s company failed, the bank tried to exercise power of sale under mortgage. The liability eventually turned out to be significantly higher because the guarantee was a continuing “all monies” guarantee which was not limited in time. The couple claimed that they would not have entered into the contract if they had known about the dire financial position of their son’s company. Furthermore, the bank did not ask them to seek legal advice prior to the signing of the contract. The majority of the High Court held that the mortgage ought to be set aside due to unconscionable conduct on the part of the bank.

Consideration is a promise or performance that the promisor demands as the price of the promise. Past consideration is something that has been performed in the past and which, therefore, cannot be consideration for a promise made in the present. Promises made to another based on moral obligation lack consideration and are not enforceable. Services performed by one family member on behalf of another family member are presumed to have been rendered in obedience to a moral obligation without expectation of consideration. An example of past and moral consideration would be the hypothetical we are discussing. A binding contract does not exist between Gerwin and Baker because the element of consideration is missing. The consideration for Gerwin's

Lord Toulson mentioned the Judicature Act 1873 in the case of AIB Group (UK) Plc v Mark Redler & Co Solicitors , and what ensued from it. The case deals with the applicable principles of causation in the case of a breach in trust. It held that a “but for” was application in such circumstances for equitable compensation. The case deals with a standard re-mortgage of a residential property. It starts when Mr and Mrs Sondhi applied to AIB group for a loan of £3.3m. Noting that they already had a mortgage with Barclays, their intention was to redeem it using AIB’s loan. Unfortunately, the solicitors at Mark Redler & Co negligently “mistook a redemption figure from Barclays as relating to the whole of their charge” it resulted as the solicitors underpaid Barclays by £309,000. The issue was that Barclays’ charge remained in place and the loan from AIB was secured only by a “second charge over the property” . Once the property was sold, there was a significant shortfall of some £2.5m. Lord Toulson also added in the case “where a trust is part of the machinery for the performance of a contract, that fact will be relevant in considering what loss has been suffered by reason of a breach of the trust.”

The two elements that make up adequate consideration are legally sufficient value and bargain-for-exchange. Legal value is when something valuable must be given to the person that performed a performance and example of this would be if someone offered me two hundred dollars to fix their car. Bargained-for-exchange is an example of this is if I mow my lawn and my land lords lawn very often then we could agree on that I don’t have to pay for rent for that month.

The doctrine of promissory estoppel was developed by Lord Denning in the case Central London Property Trust Ltd v High Trees House Ltd [1947]. In this case, Lord Denning established the doctrine "which acts as a defence to a claim by a creditor for the payment of the remainder of a debt when part payment has already been accepted." (OU, 2017). It acts to suspend the legal right of the creditor and stops them from enforcement of the original debt temporarily, forcing the creditor to honour their promise to accept part payment and this part payment would carry on until the creditor reactivates their right to the original sum.

To fully understand the impact of Williams v Roffey Bros & Nicholls Ltd [1989] on the doctrine of consideration, its is important to examine the doctrine more closely. Traditionally, modern English law has largely abandoned the benefit/detriment analysis and prefers the definition provided by Sir Federick Pollock that “consideration may be defined as an act of forbearance of one party, or the promise thereof, being the price for which the promise of the others is

If it is treated as a flexible equitable doctrine used to do justice in the particular case, then it may achieve that end in cases decided by the courts, but at the price of commercial uncertainty on the taking of security. If, on the other hand, undue influence is explained as a set of rules to be followed for security to be unimpeachable, then this will produce commercial certainty for lenders, but at the price of injustice in particular cases where the rules are followed, and the transaction is actually flawed. - one of the articles

Consideration can be classified as one party expect to get benefit from other according to the act performed by parties with a contractual deal. The benefit can be something valuable such as product or service and not only the money. It can be divided into 3 type of consideration which is executed, executor and past consideration. Executed consideration defined as when the promise carried out and thus the act has been carried

Executed In the case of unilateral contracts, where the offeror promises something in return for the offerees doing something, the promice only becomes enforceable when the offeree has actually preformed the required act. Past consideration -not valid This category does not actually count as consideration-with past consideration the action is preformed before the promise that it is supposed to be consideration for such action is not sufficient to support a later promise.(ref-: McArdle 1951) Rules relating to consideration Consideration must not be past. Performance must be legal. Performance must be possible. Consideration must move from the promise.(Tweddle v Atkinson(1861)) Consideration must be sufficient but need not be adequate. The court will not intervene to require equality in the value exchanged as long as the agreement has been freely entered into.( Chappell + Co v Nestle co(1959)) In Pinnels case 1602 it was stated that payment of a lesser sum cannot be any consideration for the whole amount owed. This opinion was approved in (Foakes v beer (1884)). However the following will operate to discharge an outstanding debt fully-: Payment in kind. Payment at a different place. Payment of a lesser sum by a third party. A composition arrangement between creditors that they will accept part payment of their debts. Source (course notes). Explain why it is important that a contracting parties

A requirement for all enforceable contract 's with the exception of those made under deed or seal. Consideration is recognised as a value or price agreed between two parties that allows them to enter into a contract. In the case Currie v 's Misa(1875) the courts defined consideration as “some right, interest, profit or benefit accruing to the one party, or some forebearance, detriment, loss or responsibility given, suffered or undertaken by

Discuss the enforceability of an agreement which lacks consideration. Using legal authorities (relevant statutes and cases) to support your discussion. Answer: A valid contract is an agreement made between two or more parties that creates rights and obligations that are enforced by law. What does the consideration mean? And what does it effect to the agreement? Consideration is something of value exchanged for the promise. It is something given by a promisee in return for something given by the promisor. According section 2(d), Contract Act provides “when at the desire of the

By way of contrast, in Mitchell Bros v Tomlinson [1957] a change of intention was found to be justifiable, despite claims that the sales of former investment properties had been motivated by leasing becoming uneconomic. That is, an increase in repair costs and the need to realise the partnership on the death of a partner. However, in this case there was a great deal of other evidence that a trading intention had been established well before the partner died.