Waiver and Promissory Estoppel Overview
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Questions and Answers

What does a waiver allow a party to do in a contract?

  • Change the terms of the contract unilaterally
  • Give up contract rights through deliberate action (correct)
  • Claim damages for breach of contract without notice
  • Enforce a contract without consideration

In which case was the doctrine of waiver notably developed?

  • Charles Rickards Ltd v Oppenheim (correct)
  • Hughes v Metropolitan Railway Co
  • Smith v Jones
  • Hickman v Haynes

What is the primary purpose of promissory estoppel?

  • To prevent unjust wrongdoing due to inconsistent actions (correct)
  • To provide a legal basis for contract modifications
  • To nullify any contractual obligations without notice
  • To enforce a right that contradicts previous agreements

What is required for a modification of a contract to be legally binding under common rules?

<p>Consideration in return (B)</p> Signup and view all the answers

What was the specific issue in the case of Hughes v Metropolitan Railway Co?

<p>Failure to complete repairs by a set deadline (B)</p> Signup and view all the answers

What is necessary for reliance to be considered adequate in promissory estoppel according to Lord Denning?

<p>Proof of reliance is sufficient. (D)</p> Signup and view all the answers

In the case of D & C Builders v Rees (1966), what was the reason the promise did not give rise to promissory estoppel?

<p>The debtor took advantage of the builders' financial difficulties. (D)</p> Signup and view all the answers

What does it mean for enforcement of strict legal rights to be considered inequitable?

<p>When it extracts the promise by taking advantage of the promisor. (C)</p> Signup and view all the answers

What is the primary effect of promissory estoppel as outlined in the provided content?

<p>To temporarily suspend the enforcement of rights. (D)</p> Signup and view all the answers

According to the content, how can modification of contract rights be characterized?

<p>As temporary and reversible. (A)</p> Signup and view all the answers

What principle does the statement 'It is a shield and not a sword' refer to in the context of promissory estoppel?

<p>It provides defense against enforcement of rights. (D)</p> Signup and view all the answers

What must a judge consider when deciding whether to enforce a promise in the context of equitable doctrines?

<p>The overall fairness and equity of the situation. (D)</p> Signup and view all the answers

In Combe v Combe (1951), what was significant about the relationship between the parties?

<p>There was no formal contract established between them. (B)</p> Signup and view all the answers

What must be proven to invoke the doctrine of promissory estoppel?

<p>The promise must be relied upon by the promisee. (A)</p> Signup and view all the answers

In the High Trees case, what was the original annual rent agreed upon for the lease?

<p>£2,500 (C)</p> Signup and view all the answers

Which of the following is NOT a condition that must be fulfilled before invoking promissory estoppel?

<p>The promise must involve a financial transaction. (B)</p> Signup and view all the answers

What is the legal outcome of the tenant's reliance on a promise in the High Trees case?

<p>The landlord cannot enforce rent until the flats are full again. (A)</p> Signup and view all the answers

What aspect of the promise is important for it to be considered for promissory estoppel?

<p>It should clearly state the intention to affect legal relations. (A)</p> Signup and view all the answers

How did the conditions of the war affect the High Trees case?

<p>It prompted the landlord to reduce the rent. (B)</p> Signup and view all the answers

What does reliance provide in the context of promissory estoppel?

<p>Justification for enforcing the promise. (B)</p> Signup and view all the answers

Which statement is true about the doctrine of promissory estoppel based on the content provided?

<p>It modifies existing relationships but does not create new ones. (D)</p> Signup and view all the answers

What was the consequence when the flats became fully occupied after the war?

<p>The landlord could demand the full rent for future periods. (D)</p> Signup and view all the answers

Which of the following best describes the role of ambiguity in the context of promissory estoppel?

<p>It prevents the claim unless clarified. (B)</p> Signup and view all the answers

Flashcards

Waiver

The act of giving up a right or claim under a contract. This can happen by intentionally not acting on the right.

Promissory Estoppel

A legal principle that prevents someone from going back on their word or actions, even if there is no formal contract.

How does Waiver occur?

A waiver happens when someone chooses not to enforce their contract rights. This can happen by doing nothing, or by taking a specific action that shows they've given up the right.

What's the purpose of Promissory Estoppel?

Promissory Estoppel steps in to make promises legally binding even if there is no formal consideration. It's all about fairness.

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Hughes v Metropolitan Railway Co

The leading case for Promissory Estoppel, illustrating how a promise can be binding even without formal consideration.

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Pre-Existing Contractual Relationship

For promissory estoppel to apply, there must have been an existing agreement or contract between the parties before the promise or representation in question was made.

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Promise Intended to Affect Legal Relations

The promise or representation made must be intended to affect the legal rights and obligations between the parties. It needs to be clear that the promise was meant to change the way they acted.

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Reliance

The party who received the promise must have relied on it and acted accordingly. Their actions must have been influenced by the promise.

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Inequitable to Enforce Strict Legal Rights

It must be unfair for the party who made the promise to go back on their word. They must have acted unfairly towards the other party by changing the agreement.

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Suspensory Effect

The effect of promissory estoppel is to temporarily suspend the original legal rights of the promisor. It doesn't permanently eliminate those rights.

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No New Rights Created

Promissory estoppel cannot create entirely new rights for the party who relied on the promise. It only modifies existing rights.

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Central London Property Trust Ltd v High Trees House Ltd (1947)

The classic case that brought the doctrine of promissory estoppel to life.

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Inequitable Conduct

The party who made the promise cannot claim the original rights back if they have acted inequitably by changing the agreement.

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Clarity and Unambiguity

Promissory estoppel requires a clear and unambiguous promise that the other party relied on.

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Promissory Estoppel (PE)

A legal principle that prevents someone from acting inconsistently with a promise, even if there is no formal contract, provided that the promisee has relied on the promise to their detriment.

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Promisor

The party who makes the promise that is relied on in promissory estoppel.

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Promisee

The party who relies on the promisor's promise in promissory estoppel.

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Detrimental Reliance

In promissory estoppel, the promisee must have acted upon the promise, causing them to be in a worse position if the promise is not kept.

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PE is a Shield, Not a Sword

Promissory estoppel is not a magic bullet to create completely new rights. It can only be used to halt the enforcement of rights that already existed.

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Suspensory Effect of PE

The effect of promissory estoppel is temporary, and the original rights can be revived with sufficient notice.

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PE Cannot Create New Rights

Promissory estoppel cannot be used to create new rights or extend existing rights beyond their original scope. It can only be used to prevent the enforcement of existing rights.

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Reliance Need Not Be Detrimental

While reliance is a crucial part of promissory estoppel, it doesn't necessarily have to be 'detrimental' as long as there's proof of reliance.

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Study Notes

Waiver and Promissory Estoppel

  • A waiver is the relinquishment of contract rights by one party, often by a positive act or inaction.
  • Waiver can be demonstrated through deliberate inaction.
  • Hickman v Haynes (1875) illustrates a buyer waiving delivery time by asking for later delivery.

Promissory Estoppel

  • Promissory estoppel is a legal principle preventing someone from arguing a right that contradicts a prior agreement.
  • It's used to prevent unjust actions based on inconsistencies.
  • Close link exists between waiver and promissory estoppel.
  • Contract modifications require consideration, but promissory estoppel can create binding promises without consideration in specific circumstances.
  • Hughes v Metropolitan Railway Co (1877) is a crucial case in developing promissory estoppel.

Pre-Existing Contractual Relationship

  • Promissory estoppel applies only to pre-existing contractual relationships, not to create new ones.
  • There must be a clear promise or representation to modify existing legal obligations between parties.

Reliance

  • Reliance is a critical aspect of promissory estoppel.
  • Promises relied upon must have influenced the promisee's conduct.
  • Reliance (including detrimental reliance) provides grounds for enforcing promises.

Inequitable Enforcements

  • Promissory estoppel can't enforce a promise if it would be inequitable to enforce the strict legal right.
  • Promisor should not have exploited a vulnerable position.
  • D & C Builders v Rees (1966) illustrates where debt modification was not supported by promissory estoppel due to inequitable conduct.

Effect of Promissory Estoppel

  • Promissory estoppel is suspensory, meaning future rights are not nullified.
  • High Trees House Ltd v Central London Property Trust Ltd (1947) demonstrated the temporary nature of the promise (limited to wartime).
  • Tool Metal Manufacturing Co Ltd v Tungsten Electric (1955): further developed the scope of promissory estoppel's temporary application.

No New Rights

  • Promissory estoppel does not create new legal rights, only modifies the enforcement of existing ones.
  • Used to prevent enforcement, not establish new rights.
  • Combe v Combe (1951) demonstrated that promissory estoppel cannot be used as a basis for creating new claims.

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Description

This quiz explores the concepts of waiver and promissory estoppel in contract law. It highlights key cases such as Hickman v Haynes and Hughes v Metropolitan Railway Co that illustrate these principles. Understand how each concept relates to contract modifications and the enforcement of promises.

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