Contract Law I - Equitable Estoppel

First element of estoppel

Clear and unequivocal promsie

Second element of estoppel

Reasonable reliance

Third element of estoppel

Knowledge or intention

Fourth element of estoppel

Detriment that estopped party failed to avoid

Central London Property Trust v High Trees House

1) Lessor estopped from claiming the full rent up to the end of 1944. This was a promise that the parties intended to be binding, knew it would be acted on, and was acted on.

2) No estoppel from 1945 onwards. The promise to reduce the rent was a ‘temporary expedient’.

Waltons Stores v Maher

1) D assumed that P could complete the transaction/sign contract (promise as to the future)

2) D relied on assumption (demolished building + construction to P’s specialisation)

3) Unconscionable to P to resile when it knew of demolition/construction + stood in silence + retained deed + could have easily withdrawn from deal + knew of urgency in transaction.

Legione v Hateley

‘I think that’ll be all right but I’ll have to get instructions’ not a clear or unequivocal promise.

Austotel v Franklins Selfserve

No estoppel. Parties were large commercial entities, ‘well resourced and advised’. Pre-contractual negotiations, commercial transaction of ‘great value’ and it was P’s ‘deliberate choice’ to keep the matter of rent open so promise could not be reasonably relied upon.

Sidhu v Van Dyke

Estoppel existed. Onus on D to prove reliance. The conduct of the estopped party need not be the ‘sole inducement’ ie it can be only one of the reasons they acted as they did. D gave evidence of reliance and was a ‘truthful witness’. It was ‘objectively likely’ that P’s assurances would have impacted her decisions.

Commonwealth v Verwayen

‘...a critical consideration will commonly be that the alleged estopped party knew or intended or clearly ought to have known that the other party would be induced by his conduct to adopt, and act on the basis of, the assumption.’ (Deane J)

Je Maintiendrai Pty Ltd v Quaglia

Lessor estopped from claiming forgone rent from lessee. Detriment in having to pay lump sum (rather than instalments) + not adopting alternatives of abandoning or assigning lease.

Riches v Hogben

Order reflected each party’s ‘equity’ - expectation based remedy:

1) Declaration that mother held land ‘on trust’ for her son and order that she transfer land to him (order simply to compensate son would be ‘quite inappropriate’)

2) Declaration that mother had interest in the land during her lifetime and may reside in the ‘granny’ flat

Beaton v McDivitt (remedy)

The benefits P had received (free rent for 7 years) were ‘disproportionate’ to any detriment suffered (moving onto land, planting trees, building ‘rock hut’).

Sidhu v Van Dyke (remedy)

Expectation-based remedy:

1) Awarded compensation based on value of the land

2) The detriment involved ‘life changing decisions with irreversible consequences’. Justice required that the value of the remedy be equivalent to the promise P had made.

Giumelli v Giumelli (remedy)

Fixed monetary sum representing the value of the son’s equitable interest in the land, ie the value of the land. No transfer of title because other family members had improved the land + his brother was living on the land. Transferring title to the land would have caused ‘injustice to others’ and gone ‘beyond what was required for conscientious conduct’ by the parents.