To get down with. the instance as respects Richard and Ernie is related to the Doctrine of Promissory Estoppel. which is derived from Equity. Harmonizing to this philosophy. if one party to the contract ( promiser ) makes a promise which the other party to the contract ( promisee ) acts upon. the promiser is estopped from traveling back on his promise. even though the promise did non supply any consideration.
Theoretically. by this construct. Ernie should be estopped from inquiring Richard for the staying balance of ?140. The chief ground is that Ernie promised to accept a smaller amount of ?160 from Richard in full colony. meaning Richard to trust on that promise. so he can non travel back to the original promise of ?300 as a full payment. Hereafter. a figure of instances refering this Doctrine shall be discussed as a mention in support of the instance of Richard and Ernie.
One of the most of import instances relevant to the instance of Richard and Ernie is Cardinal London Property Trust Ltd v High Trees House Ltd [ 1947 ] KB 130. from which the Doctrine of Promissory Estoppel originated. The Court held that portion of money as requested by the complainant. could be recovered. Harmonizing to Lord Denning. if the complainant asked to claim the whole amount of money. he would neglect to retrieve the money even though the suspect did non supply any consideration. It is because the plaintiff’s contractual right for the whole amount of rent in 1940-5 was destroyed by holding to accept the decreased rent in the wartime. By the Doctrine of Promissory Estoppel. the complainant was estopped from acquiring the full rent in wartime. so he could merely retrieve the rent after wartime. Mentioning to this instance. it shows that in the instance of Ernie and Richard. Ernie has no contractual rights to claim the staying money.
There is another similar instance. which is Tool Metal Manufacturing Co. Ltd v Tungsten Electric Co. Ltd [ 1955 ] 1 WLR 761 ( HL ) . There was a term in the contract that the suspect had to pay compensation to the complainant if he exceeded the set quota of imports. However. due to national involvement in wartime. the complainant agreed to allow him transcend the quota without any compensation. Soon after the war. the complainant gave notice to the suspect that the complainant had to pay compensation for the non-war period afterlife. The Court held that by the Doctrine of Promissory Estoppel. the counterclaim failed since there was sensible notice and therefore the complainant could retrieve the sum in the non-war period. In other words. the complainant could ne’er return to the original promise to acquire the full payment. In this manner. this gives an thought that in the instance of Ernie and Richard. Richard could trust on the Doctrine as defence.
Another of import instance is Hughes 5 Metropolitan Railway Company ( 1877 ) 2 App Cas 439 ( HL ) . which is frequently be seen as the get downing point of the Doctrine of Promissory Estoppel. The House of Lords held the six-month notice period restarted at the day of the month when the dialogue broke down. In other words. the contract of repairing was kept in suspense. and the complainant was estopped from traveling back to the promise to implement the suspect to make the fix. This proves that in the instance of Ernie and Richard. Ernie is estopped from traveling back to the original promise.
There is another similar instance. which is Brikom Investments Ltd V Carr [ 1979 ] 1 QB 467 ( CA ) . Though the original contractual term was that the renters had to pay the care. the landlords had made promise orally that they would utilize their ain disbursal. so the renters refused to pay afterwards. The Court held the landlords could non retrieve the disbursal from the renters. As stated by Lord Denning. by the Doctrine of Promissory Estoppel. the landlords could non travel back to the original promise. Once once more. this provides grounds that in the instance of Ernie and Richard. Ernie is estopped from returning to the old promise.
These four instances show a similarity — the debitors did non hold fiscal troubles and the creditors did non hold economic duress in doing their 2nd promises ( holding lesser amount for full colony ) . Yet. if there is the being of economic duress. the Doctrine of Promissory Estoppel will non use to the instance and therefore the 2nd promise made under economic duress will be invalid.
The authoritative instance in regard of economic duress is D. & A ; C. Builders Ltd V Rees [ 1966 ] 2 QB 617 ( CA ) . The complainant lent a loan of ?482 to the suspect. yet the suspect had fiscal troubles and said that either the complainant accepted ?300 as a full colony or received nil at all. Under economic duress. the complainant had no pick but to accept the colony. The Court held that the suspect had to refund the staying balance. As explained by Lord Denning. since the promise was non freely given. it was under an unjust province ; in other words. the complainant had contractual rights on the first promise and the 2nd promise was invalid. so the Doctrine of Promissory Estoppel could non use. Similarly. in the instance of Ernie and Richard. Richard besides had troubles in paying the money in a short clip. In malice of that. Richard did non inquire for a smaller sum for the full colony. Hence. there was non any economic duress imposed by Richard. Thus. the Doctrine of Estoppel would still be applied and Ernie’s right for the staying balance was lost.
Based on the premise that Ernie actively and freely promised with Richard that he would accept a lesser amount for full colony. and there was no economic duress forced by Richard. the Doctrine of Promissory Estoppel is applied. Under this circumstance. Ernie lost his rights for the full amount. Merely if Richard was the one to inquire for the via media and force Ernie to accept the footings or have no money at all. so it will non be the instance — even Ernie was forced to compromised. this promise will non be valid and hence Ernie will be entitled to acquire the full sum of payment.
– Poole J. . ( 2004 ) . Casebook on Contract Law. 6th edition. Oxford. Hampshire.
– Richards P. . ( 2004 ) . Law of Contract. 6th edition. Pearson. Dorchester.
– Elliott C. and Quinn F. . ( 2003 ) . Contract Law. 4th edition. Pearson. Dorchester.
Brikom Investments Ltd V Carr[ 1979 ] 1 QB 467 ( CA )
Cardinal London Property Trust Ltd v High Trees House Ltd[ 1947 ] KB 130
D. & A ; C. Builders Ltd V Rees[ 1966 ] 2 QB 617 ( CA )
Hughes V Metropolitan Railway Company
( 1877 ) 2 App Cas 439 ( HL )
Tool Metal Manufacturing Co. Ltd v Tungsten Electric Co. Ltd[ 1955 ] 1 WLR 761 ( HL )