Equity & Trusts: Estoppel Overview

• Study notes on estoppel for Equity & Trusts.
• The lecture explores the historical development, different types, and classification of estoppels.
• It also examines the expansion and contraction of estoppel in legal history.

Structure of the Topic

• Lecture 5 covers the historical development of estoppels, estoppel by representation, promissory estoppel, and how to classify estoppels.
• Lecture 6 delves into proprietary estoppel, how to measure it, and its expansion and contraction.

Expansion and Contraction of Estoppel

• Andrew Robertson discusses the cycles of expansionary and contractionary movements in equitable estoppel.
• The doctrine widens in its uses based on expansions of estoppel, and undergoes contractions when courts scale back its use.

Looking for Expansion and Contraction

• The study of estoppel involves looking at its historical development and estoppel by representation.
• The modern development of estoppel including promissory estoppel and the Australian approach, are other elements that need to be taken into account.
• Furthermore there are challenges and controversies in proprietary estoppel along with measuring the estoppel.

Historical Development

• Sir Edward Coke (1628) defined "estoppel" as derived from the French word "estoupe," meaning to stop or conclude, preventing someone from alleging or pleading the truth.
• Estoppel operates as a technique of evidence.
• At Common Law estoppel's use was limited to something stated in a deed or a renowned act.
• Chancery took a wider approach and was more flexible than common law.
• Estoppel by representation, words and conduct were considered.
• Hunt v Carew (1649) involved a son estopped from denying the validity of a lease, creating a right in the lease based on estoppel.

Historical Development: Estoppel by Representation

• Pickard v Sears (1837) states that if someone's words or conduct willfully cause another to believe a certain state of affairs and act on it, the former is prevented from denying that state of affairs.

Early Questions for Estoppel by Representation

• Key questions included whether estoppel by representation compelled the performance of the representation.
• Another consideration was whether it extended to promises for the future, or was limited to current states of fact.
• Relevant cases include Montefiori v Montefiori (1762), Hammersley v De Biel (1845), and Jorden v Money (1854).

Historical Development: Statement of Existing Fact

• Montefiori v Montefiori (1762) holds that if third parties misrepresent something material during marriage proposals, they are bound to make good the thing in the manner represented.

Historical Development: Future Statements

• Hammersley v De Biel (1845) held that if a party makes inducements to another to celebrate marriage, a Court of Equity will ensure the proposal is given effect.

Estoppel by Representation: Not Binding the "Future"

• Jorden v Money (1854) states that estoppel doctrine does not apply when the representation is not a representation of fact, but a statement of future intent.

Jorden v Money - Lord St Leonards on the Present and the Future

• A fine line exists between representing a fact and an intention.
• Stating one does not intend to enforce rights is a statement of fact regarding present abandonment of those rights.
• The wording matters, for example, "I will not enforce the debt" differs from "I have abandoned the debt".
• Lord St Leonards was in the minority.

Limits/Uses of Estoppel by Representation

• As an evidential device, it holds people to the truth.
• Estoppel is problematic as a cause of action, undermining contracts, as seen in Baird Textile Holdings v Marks & Spencer (2001).
• As a defence to restitution, estoppel should not operate where it would be inequitable, as noted in Derby v Scottish Equitable (2001) and National Westminster v Somer International (2001).

Expansion, Contraction and Modern Developments

• Up to the 19th century, Montefiore expanded the effect of creating rights.
• Hammersley v de Biel also expanded giving effect to proposals (promises/future intent).
• Jorden v Money contracted estoppel by representation, stating that it does not apply to statements of future intent.
• Modern developments include Promissory Estoppel in the 20th Century.
• Proprietary Estoppel is discussed in the next lecture.

Towards the Modern Development

• Hughes v Metropolitan Railway Company (1877) states that if parties enter negotiations leading one to believe strict contractual rights won't be enforced, those rights cannot be enforced if it would be inequitable.

Promissory Estoppel: High Trees

• Central London Property Trusts Ltd v High Trees House Ltd (1947) establishes that a promise intended to be binding, acted on, and in fact acted on, is binding as far as its terms properly apply.

The Approach in Australia: Walton's Stores

• Walton's Stores (Interstate) Ltd v Maher (1988) details how lessees instructed their solicitor to ‘go slow’ while the landowner began demolition, so lessees withdrew.
• The High Court found the landowner could use promissory estoppel to enforce the contract because the lessees created an implied promise.
• Promissory estoppel can be used as a cause of action.
• The remedy is the minimum equity needed to avoid the detriment suffered.
• The effect was to enforce the conclusion of the contract.

Classification of the Estoppels

• Recategorisation is needed for coherence and certainty, because of fusion.
• There are three parts to fusion, procedural, terminological and substantive.
• Tradition resists re-classification, but is a way of solving legal problems (Smith).
• Positivism avoids incoherence, achieves clarity, creates order, and re-organises law into a coherent system.

(Re)Classification

• The study of estoppel can be simplified to contract, tort, or unjust enrichment.
• Contract includes unilateral contracts and specific enforcement of unwritten land contracts.
• Tort includes negligent misstatement.
• Unjust enrichment includes restitution of UE, not entitled to retain the benefit of the claimant's services.
• Equity pre-empted unilateral contracts (Carlill v Carbolic Smoke Ball Co - 1893), negligent misstatement (Hedley Byrne v Heller – 1964), and unjust enrichment (Lipkin Gorman v Karpnale – 1991).

Classifying Estoppel: A Unitary Concept?

• There is no single explanation for the way estoppels operate.
• Estoppel in all its forms is based on fairness, justice and so forth.
• Unconscionability is the underlying feature of all estoppels.
• There is a distinction between forms of proprietary estoppel which arise variously on the basis of avoidance of detriment, enforcement of promise, or on grounds of mistake.
• Lord Goff stated that the many circumstances capable of giving rise to an estoppel cannot be accommodated within a single formula, and it is unconscionability that provides the link between them.