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Primossory Estoppel
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Questions in this quiz (9)
1Central London Property Trust Ltd v High Trees House Ltd [1947
- AHigh Trees leased a block of flats from CLP at a ground rent of £2,500. It was a new block of flats at the time the lease was taken out in 1937. The defendant had difficulty in getting tenants for all the flats and the ground rent left High Trees with no profit. In 1940 many of the flats were still unoccupied and with the conditions of the war prevailing, it did not look as if there was to be any change to this situation in the near future. CLP agreed to reduce the rent to £1,250 during the war years. The agreement was put in writing and High Trees paid the reduced rent from 1941. When the war was over the flats became fully occupied and the claimant sought to return to the originally agreed rent.
- A clear promise
- Inequitable to retract
- Reliance by promisee
- Alteration of existing legal rights
The rent would be returned to the originally agreed price for the future only. CLP could not claim back the arrears accrued during the war years
A promise intended to be binding, intended to be acted on and in fact acted on, is binding so far as its terms properly apply. - BHigh Trees leased a block of flats from CLP at a ground rent of £2,500. It was a new block of flats at the time the lease was taken out in 1937. The defendant had difficulty in getting tenants for all the flats and the ground rent left High Trees with no profit. In 1940 many of the flats were still unoccupied and with the conditions of the war prevailing, it did not look as if there was to be any change to this situation in the near future. CLP agreed to reduce the rent to £1,250 during the war years. The agreement was put in writing and High Trees paid the reduced rent from 1941. When the war was over the flats became fully occupied and the claimant sought to return to the originally agreed rent.
- A clear promise
- Equitable to retract
- Reliance by promisee
- Alteration of existing legal rights
The rent would be returned to the originally agreed price for the future only. CLP could not claim back the arrears accrued during the war years
A promise intended to be binding, intended to be acted on and in fact acted on, is binding so far as its terms properly apply.
- AHigh Trees leased a block of flats from CLP at a ground rent of £2,500. It was a new block of flats at the time the lease was taken out in 1937. The defendant had difficulty in getting tenants for all the flats and the ground rent left High Trees with no profit. In 1940 many of the flats were still unoccupied and with the conditions of the war prevailing, it did not look as if there was to be any change to this situation in the near future. CLP agreed to reduce the rent to £1,250 during the war years. The agreement was put in writing and High Trees paid the reduced rent from 1941. When the war was over the flats became fully occupied and the claimant sought to return to the originally agreed rent.
2Hughes v Metropolitan Railway (1877
- A landlord gave a tenant 6 months notice to carry out repairs failure to do so would result in forfeiture of the lease. The landlord and tenant then entered into negotiations for the tenant to purchase the freehold of the property. It was thought by both parties that a conveyance of the property would take place. The tenant had not carried out the repairs as they believed they would be purchasing the freehold and the repairs required by the landlord were not essential to his use of the property. At the last minute negotiations broke down and the Landlord gave the tenant notice to quit for failure to carry out the repairs
If a promise is implied in negotiations and one party relies on that promise then it is inequitable to allow the other party to act as though the promise does not exist.
The time limit imposed for carrying out the repairs was suspended during the negotiations - B landlord gave a tenant 6 months notice to carry out repairs failure to do so would result in forfeiture of the lease. The landlord and tenant then entered into negotiations for the tenant to purchase the freehold of the property. It was thought by both parties that a conveyance of the property would take place. The tenant had not carried out the repairs as they believed they would be purchasing the freehold and the repairs required by the landlord were not essential to his use of the property. At the last minute negotiations broke down and the Landlord gave the tenant notice to quit for failure to carry out the repairs
If a promise is implied in negotiations and one party relies on that promise then it is equitable to allow the other party to act as though the promise does exist.
The time limit imposed for carrying out the repairs was suspended during the negotiations
- A landlord gave a tenant 6 months notice to carry out repairs failure to do so would result in forfeiture of the lease. The landlord and tenant then entered into negotiations for the tenant to purchase the freehold of the property. It was thought by both parties that a conveyance of the property would take place. The tenant had not carried out the repairs as they believed they would be purchasing the freehold and the repairs required by the landlord were not essential to his use of the property. At the last minute negotiations broke down and the Landlord gave the tenant notice to quit for failure to carry out the repairs
3Combe v Combe [1951]
- AA husband promised to make maintenance payments to his estranged wife but failed to do so. The wife brought an action to enforce the promise invoking promissory estoppel.
Estoppel is only a defence, not a cause of action where one did not exist before
Her action suceed. There was no pre-existing agreement which was later modified by a promise. - BA husband promised to make maintenance payments to his estranged wife but failed to do so. The wife brought an action to enforce the promise invoking promissory estoppel.
Estoppel is only a defence, not a cause of action where one did not exist before
Her action failed. There was no pre-existing agreement which was later modified by a promise.
- AA husband promised to make maintenance payments to his estranged wife but failed to do so. The wife brought an action to enforce the promise invoking promissory estoppel.
4Crabb v Arun District Council [1975
- AThe plaintiff was led to believe that he would acquire a right of access to his land. In reliance on that belief he sold off part of his land, leaving the remainder landlocked
His claim to have raised an equity was upheld. The plaintiff should have a right of access without payment
The court should approach the task cautiously to achieve ‘the minimum equity to do justice to the plaintiff.’ - BThe plaintiff was led to believe that he would acquire a right of access to his land. In reliance on that belief he sold off part of his land, leaving the remainder landlocked
His claim to have raised an equity was quashed. The plaintiff should have a right of access without payment, however the plaintiff undergone illegal routes and therefore the courts ruled against his favour
- AThe plaintiff was led to believe that he would acquire a right of access to his land. In reliance on that belief he sold off part of his land, leaving the remainder landlocked
5Promissory Estoppel: general suspends legal rights until such time as the promise is in better financial position. however in some PE can extinguish legal rights completely
- ATrue
- BFalse
6Tungsten Electric Co Ltd v Tool Metal Manufacturing Co Ltd (1950
- ATungsten had been infringing a human right held by TMM. When TMM heard of this they waived all infringements in return for Tungsten paying 10% Royalty and also 30% 'compensation' if sales exceeded 50KG in any month. These sums were excessive but Tungsten agreed to pay them otherwise they would be faced with a claim for infringing the copyright. Tungsten struggled to make payments. They got into arrears during the war times and an agreement was reached to waive the 'compensation' payments during the war years.
TMM could not enforce the compensation payments during the war years but could enforce them on termination of the war. TMM were not estopped from going back on their promise to waive the payments in equity. Generally promissory estoppel will merely suspend legal rights rather than extinguish them. However, where periodic payments are involved and a promise has been made to reduce the payments because of pressing circumstances which are not likely to persist, promissory estoppel can be used to extinguish legal rights.
- BTungsten had been infringing a patent right held by TMM. When TMM heard of this they waived all infringements in return for Tungsten paying 10% Royalty and also 30% 'compensation' if sales exceeded 50KG in any month. These sums were excessive but Tungsten agreed to pay them otherwise they would be faced with a claim for infringing the copyright. Tungsten struggled to make payments. They got into arrears during the war times and an agreement was reached to waive the 'compensation' payments during the war years.
TMM could not enforce the compensation payments during the war years but could enforce them on termination of the war. TMM were estopped from going back on their promise to waive the payments in equity. Generally promissory estoppel will merely suspend legal rights rather than extinguish them. However, where periodic payments are involved and a promise has been made to reduce the payments because of pressing circumstances which are not likely to persist, promissory estoppel can be used to extinguish legal rights.
- ATungsten had been infringing a human right held by TMM. When TMM heard of this they waived all infringements in return for Tungsten paying 10% Royalty and also 30% 'compensation' if sales exceeded 50KG in any month. These sums were excessive but Tungsten agreed to pay them otherwise they would be faced with a claim for infringing the copyright. Tungsten struggled to make payments. They got into arrears during the war times and an agreement was reached to waive the 'compensation' payments during the war years.
7D&C Builders v Rees [1966
- AMr Rees instructed the claimant to do some building work at his home to the value of £746. Mr Rees paid £250 on account and the claimant reduced the bill by £14 and there was a sum owing of £482. The claimant wrote to the defendant several times pressing for payment but was unsuccessful there had been no complaints as to the workmanship at this time. The claimant at the time was in dire financial need and the business was verging on bankruptcy a fact that Mrs Rees was aware of. The defendant telephoned the home and Mrs Rees answered she made complaints about the work and said she would give them £300 in satisfaction of the whole debt. The defendant refused and said he would take the £300 and give her a year to clear the balance. He called at the house to collect the money but Mrs Rees remained firm that she would only pay £300 and demanded that the defendant wrote on the receipt 'in completion of the account' otherwise she would pay him nothing. The defendant needed the money immediately so reluctantly agreed to write this on the receipt but stated he fully intended to pursue the balance as the money paid did not cover the costs he had incurred. He subsequently brought an action to recover the balance. The defendant sought to rely on estoppel relying on the written receipt as demonstrating a promise to accept the lesser sum.
The claimants were successful. Mrs Rees could rely on estoppel as there was true agreement to accept less and because Mrs Rees had taken advantage of the builder's position and mislead them as to her financial position. - BMr Rees instructed the claimant to do some building work at his home to the value of £746. Mr Rees paid £250 on account and the claimant reduced the bill by £14 and there was a sum owing of £482. The claimant wrote to the defendant several times pressing for payment but was unsuccessful there had been no complaints as to the workmanship at this time. The claimant at the time was in dire financial need and the business was verging on bankruptcy a fact that Mrs Rees was aware of. The defendant telephoned the home and Mrs Rees answered she made complaints about the work and said she would give them £300 in satisfaction of the whole debt. The defendant refused and said he would take the £300 and give her a year to clear the balance. He called at the house to collect the money but Mrs Rees remained firm that she would only pay £300 and demanded that the defendant wrote on the receipt 'in completion of the account' otherwise she would pay him nothing. The defendant needed the money immediately so reluctantly agreed to write this on the receipt but stated he fully intended to pursue the balance as the money paid did not cover the costs he had incurred. He subsequently brought an action to recover the balance. The defendant sought to rely on estoppel relying on the written receipt as demonstrating a promise to accept the lesser sum.
The claimants were successful. Mrs Rees could not rely on estoppel as there was no true agreement to accept less and because Mrs Rees had taken advantage of the builder's position and mislead them as to her financial position.
- AMr Rees instructed the claimant to do some building work at his home to the value of £746. Mr Rees paid £250 on account and the claimant reduced the bill by £14 and there was a sum owing of £482. The claimant wrote to the defendant several times pressing for payment but was unsuccessful there had been no complaints as to the workmanship at this time. The claimant at the time was in dire financial need and the business was verging on bankruptcy a fact that Mrs Rees was aware of. The defendant telephoned the home and Mrs Rees answered she made complaints about the work and said she would give them £300 in satisfaction of the whole debt. The defendant refused and said he would take the £300 and give her a year to clear the balance. He called at the house to collect the money but Mrs Rees remained firm that she would only pay £300 and demanded that the defendant wrote on the receipt 'in completion of the account' otherwise she would pay him nothing. The defendant needed the money immediately so reluctantly agreed to write this on the receipt but stated he fully intended to pursue the balance as the money paid did not cover the costs he had incurred. He subsequently brought an action to recover the balance. The defendant sought to rely on estoppel relying on the written receipt as demonstrating a promise to accept the lesser sum.
8Barton v Armstrong [1975
- AArmstrong was the chairman and held the largest sharing holding in Landmark Corporation Ltd a public company. Barton was the managing director and also had a substantial shareholding in. There were two other directors Bovil and Cottrel. There had been a long history of ill will between the parties and a struggle over who should have controlling power with Armstrong being the most aggressive. The other directors in the company were also unhappy with Armstrong and wanted him to be removed for abusing certain privileges and they disagreed with the way he ran the company believing him to be putting the company at risk of insolvency. However, Armstrong refused to resign. The three managed to take control of subsidiary companies and removed all credit facilities from Landmark Corp. When Armstrong discovered the credit had been removed he made a number of death threats to Barton to pressure him into signing an agreement which contained various elements including the purchase by Barton of Armstrong's shares in the company at a substantial over value. Barton agreed to this partly due to the threats but also due to the fact that it would mean that Armstrong would no longer have controlling interest and he believed he would be able to turn the company around without Armstrong's dealings. However, the company became insolvent shortly after and Barton sought to have the contract set aside.
The contract could not be set aside. Where there is duress to the person there was obligation to show that he would not have entered the agreement but for the threat, it simply being sufficient that the death threats were a cause. - BArmstrong was the chairman and held the largest sharing holding in Landmark Corporation Ltd a public company. Barton was the managing director and also had a substantial shareholding in. There were two other directors Bovil and Cottrel. There had been a long history of ill will between the parties and a struggle over who should have controlling power with Armstrong being the most aggressive. The other directors in the company were also unhappy with Armstrong and wanted him to be removed for abusing certain privileges and they disagreed with the way he ran the company believing him to be putting the company at risk of insolvency. However, Armstrong refused to resign. The three managed to take control of subsidiary companies and removed all credit facilities from Landmark Corp. When Armstrong discovered the credit had been removed he made a number of death threats to Barton to pressure him into signing an agreement which contained various elements including the purchase by Barton of Armstrong's shares in the company at a substantial over value. Barton agreed to this partly due to the threats but also due to the fact that it would mean that Armstrong would no longer have controlling interest and he believed he would be able to turn the company around without Armstrong's dealings. However, the company became insolvent shortly after and Barton sought to have the contract set aside.
The contract could be set aside. Where there is duress to the person there was no obligation to show that he would not have entered the agreement but for the threat, it simply being sufficient that the death threats were a cause.
- AArmstrong was the chairman and held the largest sharing holding in Landmark Corporation Ltd a public company. Barton was the managing director and also had a substantial shareholding in. There were two other directors Bovil and Cottrel. There had been a long history of ill will between the parties and a struggle over who should have controlling power with Armstrong being the most aggressive. The other directors in the company were also unhappy with Armstrong and wanted him to be removed for abusing certain privileges and they disagreed with the way he ran the company believing him to be putting the company at risk of insolvency. However, Armstrong refused to resign. The three managed to take control of subsidiary companies and removed all credit facilities from Landmark Corp. When Armstrong discovered the credit had been removed he made a number of death threats to Barton to pressure him into signing an agreement which contained various elements including the purchase by Barton of Armstrong's shares in the company at a substantial over value. Barton agreed to this partly due to the threats but also due to the fact that it would mean that Armstrong would no longer have controlling interest and he believed he would be able to turn the company around without Armstrong's dealings. However, the company became insolvent shortly after and Barton sought to have the contract set aside.
9Walton Stores v Maher (1988
- AWaltons negotiated with Maher for the lease of property owned by Maher. The parties understood Maher would demolish an existing building and erect a new one which Waltons would occupy. Agreement was reached on terms and rent. Waltons' solicitors sent a draft lease to Maher's solicitors in October and some changes were discussed. A revised lease was then sent to Waltons by Maher. In November Maher informed Waltons that demolition had commenced and it was therefore important to conclude the lase quickly. Later that month Waltons started to have reservations about the lease and instructed its solicitors to 'go slow'. In January Maher commenced building. Later that month, when approximately 40% of building work was completed, Waltons informed Maher it did not wish to proceed. Maher brought action to enforce the agreement
disallowed appeal: failure to fulfil a promise does not itself amount to unconscionable conduct. Changing position or promise to do something would require more. There must be two things: 1) urgency of the negotiations 2) completion and transfer of all relevant document to Walton stores
As a result, Waltons was estopped from retreating from its implied promise to complete. - BWaltons negotiated with Maher for the lease of property owned by Maher. The parties understood Maher would demolish an existing building and erect a new one which Waltons would occupy. Agreement was reached on terms and rent. Waltons' solicitors sent a draft lease to Maher's solicitors in October and some changes were discussed. A revised lease was then sent to Waltons by Maher. In November Maher informed Waltons that demolition had commenced and it was therefore important to conclude the lase quickly. Later that month Waltons started to have reservations about the lease and instructed its solicitors to 'go slow'. In January Maher commenced building. Later that month, when approximately 40% of building work was completed, Waltons informed Maher it did not wish to proceed. Maher brought action to enforce the agreement
Allow appeal: failure to fulfil a promise does itself amount to unconscionable conduct. Changing position or promise to do something would require more. There must be two things: 1) urgency of the negotiations 2) completion and transfer of all relevant document to Walton stores
As a result, Waltons was estopped from retreating from its implied promise to complete.
- AWaltons negotiated with Maher for the lease of property owned by Maher. The parties understood Maher would demolish an existing building and erect a new one which Waltons would occupy. Agreement was reached on terms and rent. Waltons' solicitors sent a draft lease to Maher's solicitors in October and some changes were discussed. A revised lease was then sent to Waltons by Maher. In November Maher informed Waltons that demolition had commenced and it was therefore important to conclude the lase quickly. Later that month Waltons started to have reservations about the lease and instructed its solicitors to 'go slow'. In January Maher commenced building. Later that month, when approximately 40% of building work was completed, Waltons informed Maher it did not wish to proceed. Maher brought action to enforce the agreement
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- Law (Contract law) Quiz on Primossory Estoppel , created by richard.w2020 on 20/03/2015.
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