Durham E-Theses
Equitable estoppel and the enforcement of promises
Duncanson, Ian William
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Duncanson, Ian William (1978)
Equitable estoppel and the enforcement of promises, Durham theses,
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EQUITABLE
ESIOEPEL
AND
THE
EKPORCEMENT
OE
PROMISES
I a n W i l l i a m Dvmcanaon
Submitted f o r t h e award o f t h e degree o f
B a c h e l o r o f C i v i l Law i n t h e U n i v e r s i t y o f Durham.
EQUITABLE ESTOPPEL ARB
degree o f Bachelor
THE
of Civil
PROMISES - T h e s i s s u b m i t t e d f o r t h e
EKFORCEIVIEI'JT OP
Law.
ABSTRACT •
T a k i n g as my
s t a r t i n g - p o i n t t h e v i e w t h a t e q u i t y i s e s s e n t i a l l y a mechanism
f o r preempting
t h e e n f o r c e m e n t o f common l a w r e m e d i e s , I a t t e m p t t o show t h a t
e q u i t a b l e e s t o p p e l i s i n t h e main stream o f e q u i t a b l e developments; t h a t i t s
h i s t o r y i s l o n g e r t h a n t h a t r e c o g n i z e d i n t h e more r e c e n t cases; and t h a t i t
c u r r e n t l y a v a i l s p r o m i s e e s who
w i t h the requirements
are unable
t o frame t h e i r s u i t s i n c o n f o r m i t y
o f common l a w c o n t r a c t .
I have p r e f e r r e d t o l o o k t o t h e d i s t i n c t l y e q u i t a b l e v i e w o f c o n t r a c t , o b s c u r e d
f o r a t i m e by t h e c o u r t s o f t h e n i n e t e e n t h c e n t u r y , r a t h e r t h a n t o t h e answer
suggested
by A t i y a h , i n o r d e r t o meet t h e problems e n c o u n t e r e d
o f the. o f f i c i a l
obeisance t o the d o c t r i n e o f c o n s i d e r a t i o n .
a t l a w by
The
reason
equity, I
suggest, f a c i l i t a t e s a more u n i f i e d p i c t u r e , when p l a c e d i n t h e c o n t e x t o f
e q u i t y ' s t r a d i t i o n a l a i m s , o f r e c e n t changes, p a r t i c u l a r l y i n t h e f i e l d
l i c e n c e s : f o r by e m p h a s i s i n g i t s e q u i t a b l e n a t u r e , one may
t h e o b j e c t i o n t h a t new
i n t e r e s t s i n l a n d are being c r e a t e d .
t r u s t i t s e l f i s a mere h i g h l y d e v e l o p e d
so, I u r g e , i s t h e s o - c a l l e d "new
o f r e e e n t cases may
form o f preemption
equity".
g a i n meaning i f one
By r e f e r e n c e t o i t s h i s t o r y , i t s a n a l o g y
axidi i t s l a c k o f r e a l c o n n e x i o n W i t h
And
more e a s i l y
counter
S t a t u t e aside, the
of a legal claim;
again, the confusing
sees them i n t h i s
of
kaleidoscope
way.
to sO-called " p r o p r i e t o r y estoppel",
common l a w e s t o p p e l , I suggest t h a t e q u i t a b l e
e s t o p p e l i n a l l o f i t s m a n i f e s t a t i o n s can p r o p e r l y f o u n d a cause o f a c t i o n ,
t h a t o n l y an u n j u s t i f i a b l e j u d i c i a l t i m i d i t y p r e v e n t s t h e r e a l i z a t i o n o f
Moreover, I s t r e s s t h a t g r e a t e r equivalence
this.
between l a w and t h e mores, b o t h
o f t h e c o m m e r c i a l anS. t h e p r i v a t e t r a n s a c t o r , may
use
and
be o b t a i n e d t h r o u g h g r e r . t e r
o f t h e p r o m i s e - e n f o r c i n g remedy: t h a t i s t o say, i t s c r i t e r i o n o f e n f o r c e -
ment, " e q u i t y " , l i k e t h a t o f t h e r e a s o n a b l e
v/hose v a l u e may
man
a t common l a w , i s a p a r a m e t e r
be v a r i e d a c c o r d i n g w i t h t h e s t a n d a r d s o f t h e t i m e .
11
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122
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96
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Binningham & D i s t r i c t
123
14,31,52,119,120,125,139,140
1 KB 615
Land Co. v LK'.TR (.1888) 40 Ch.D. 268
82,88
35,47,48,57,69,71,
99,103,137
B r a n d v C h r i s B u i l d i n g (1.957) VR 625
39
B r i t i s h R a i l w a y s B o a r d v H e r r i n g t o n ( 1 9 7 2 ) 1 A l l E R 462
10
Bromage v Genning R o l l Rep. 368
18
Brown v CIR (.1954) 3 A l l E R 119
.
Bruce v A i l e s b u r y (.1892) AC 356
B u r n s v D i l w o r t h T r u s t e e Board ( 1 9 2 5 ) NZLR 488
Burrowes
v Lock ( 1 8 0 5 ) 1.0 Ves 470
7
4
66
37
ix
35,70
B u t t e r y v P i c k a r d ( 1 9 4 6 ) \W 25
C
C a i r n c r o s s v L o r r i m e r ( 1 8 6 0 ) 3 L E 170
78,104
Canadian & D o m i n i o n Sugar C o r p o r a t i o n v Canadian N a t i o n a l SS L i n e s ( 1 9 4 7 )
AC 46
Canadian
70
P a c i f i c R a i l w a y v R. ( 1 9 3 1 ) AC 414
67,68,99
C a n d l e r v Crane C h r i s t m a s (1951.) 2 KB 164
37
V C a r b o l i c Smoke B a l l Co. ( 1 3 9 3 ) 1 Q3 256
26
C a r l Z e i s s S t i f f t u n g v H. S m i t h ( 1 9 6 9 ) 2 A l l E R 367
129
Carlill
Carr v m m
( 1 8 7 5 ) LR 10 CP 317.
45
Caton V Caton ( 1 B 6 1 ) LR I Ch. 137
33
C e n t r a l London P r o p e r t y Co. v H i g h Trees House L t d . ( 1 9 4 7 ) KB I 3 0
1,30,34,35,
71,72,76,77,78,86,88,89,90,131,137,139
57
Chadwick v Manning ( 1896). AC 231
Chalmers
v Pardoe
(I963)
1 WLR 677
107,129,137
C h a n d l e r v DPP ( I 9 6 4 ) AC 763
10
C i t i z e n s ' Bank o f L o u i s i a n a and t h e New O r l e a n s Canal & B a n k i n g Co. v F i r s t
N a t i o n a l Bank o f New O r l e a n s ( 1 8 7 3 ) LRVI HL 352
C i t y o f W e s t m i n s t e r P r o p e r t y v Kudd ( 1 9 5 8 )
2 A l l E R 733
C o l e s V P i l k i n g t o n LR 19 EQ. 1711
Combe v Combe ( 1 9 5 1 )
2 KB 215
33,35,36,76,89,90,91,92,96,100,101,113,139
57
Cookes V M a s c a l l 2 V e m 200
25,36
( 1 9 4 7 ) KB 554
78,81
C r a i n e v C o l o n i a l M u t u a l I n s u r a n c e Co. ( 1 9 2 0 ) 28 CLR 305
C r e s w e l l v J e f f r e y s (1912)
79,104
41,58
Cooke V I n g r a m ( 1 8 9 3 ) 68 LT 671
Couchman v H i l l
42,43,44,47,138
28 TLR 4
C u r r i e v M i s a ( 1 3 7 6 ) Lfi Exch.
153
C z a r n i k o v v R o t h Schmidt ( 1 9 2 2 )
2 KB 378
52,64
62
58
6
D
D & C B u i l d e r s v Rees ( 1 9 6 6 ) 2 QB 6 I T
Dabbs V Seaman ( 1 9 2 5 )
36 CLR 538
Qe l a Bere v P e a r s o n ( 1 9 0 8 )
1 KB 280
30,42,113,114,139
66
12,27,72,107
D e r r y v Peek ( 1 8 8 9 ) 14 App. Cas. 337
x
28,43,55,56,57
Dilwyn v Llewellyn
58,71
Donoghue v S t e v e n s o n ( 1 9 3 2 ) AC 562
56,100
D u n l o p V S e l f r i d g e ( 1 9 1 5 ) AC 847
Durham Fancy Goods v Jacg^on
(.1968) 2 QB 839
123
8,113,114,115
E
E a g l e w e l l v Needham ( 1972) 1. A l l E R 417
1.0
Eastwood
4
V Kenyon ( 1 8 4 0 ) 11 Ad.& E l . 438
E d g i n g t o n v F i t z m a u r i c e 29 Ch.D. 459
53
Edwards v Skyways ( 1 9 6 4 ) 1 WLR 349
114
E f f y , The (197.2) 2 L l . R 78
63
E g e r t o n v E a r l Brownlow ( 1 8 5 3 ) 1 HLC 123
54
E r r i n g t o n v E r r i n g t o n & Woods ( 1 9 5 2 ) 1 A l l E R 149
95,96
E s p l e y V W i l k e s LR V I I Exch 298
45
Evans v B i c i c n e l l ( 1 8 0 1 ) 5 Ves 174
28
F
Fenner v B l a k e ( I 9 O O ) 1 QB 426
F e r r i s v Weaver ( 1952) 2. A l l E R 233
35,61
96,97,101
F i s h e r v B e l l ( 1 9 5 1 ) 1QB 394
Foakes v Beer ( 1 8 8 3 ) 11 QBD 221
10
22,47,48,138
77
F o o t C l i n i c s ( 1 9 4 3 ) L t d . v Cooper's Gowns ( 1 9 4 7 ) IvB 507
F o s t e r v R o b i n s o n ( 1 9 5 0 ) 2 A l l E R 342
94,95,119,121,139
G.
25,26
Gale V L i n d o 1. V e r n . 475
102
G l a s s b r o o k v Glamorgan County C o u n c i l ( 1 9 2 5 ) AC 270
58
Gopi V Basheshwar WH ( 1 8 8 5 ) 100
58,90
Gore V Van d e r Lann ( 1 9 6 7 ) 2 QB 31
G o r e t t V Radnidge
( 1 8 0 2 ) 3 E a s t 52
G r a n t v A u s t r a l i a n K n i t t i n g M i l l s ( 1 9 3 5 ) AC 85
G r a n t v Dawkins (.1973) 3 A l l E R 897
.
: 141
56
118
Greenwood v M a r t i n ' s Bank ( 1 9 3 3 ) A^ 5 I a t p.57
68
Gregg V W e l l s 10 Ad.& E l . 90
25
xi
G r e g o r y v M i g h e l l ( 1 8 1 1 ) 18 Ves. 328
Guy V W a t e r l o w ( 1 9 0 9 ) 25 TLR 515
H
38
60
( 1 8 5 4 ) 9 Ex 341
H a d l e y v Baxendale
I07
H a l s a l l V B r i z e l l ( 1 9 5 7 ) 1 A l l E R 371
112
Hammersley v De B i e l ( 1 8 4 5 ) X I I CI.5c F i n 45
27,29,30,33,37,41,43,44,46,47,58,
71,106,136
Harnam S i n g h v Jamal P i r b h a i ( 1 9 5 1 ) AC 688
88
H a r r i s v N i c k e r s o n ( 1 8 7 3 ) 2 R8QB 286
79
H a r t V F r o n t i n o and B o l i v i a S o u t h . ^ e r i c a n Gold M i n i n g Co. (1870) L.^V
42,45
Exch.Ill
H a s t i n g s v S a d d l e r ( 1 8 9 8 ) 79 LT 355
61
H e d l e y Byrne v d e l l e r & P a r t n e r s ( 1 9 6 4 ) AC 465
27,37,72,107
4I
Hickman v Haynes ( 1 8 7 5 ) LR 8CP 598
Hobbs V N o r t o n 1 V e r n I 3 6
26,33,36
H o c h s t e r v De l a T o u r ( 1 8 5 3 ) 2 S & B 673
Hodgson V H u t c h e s o n
7
( 1 7 1 1 ) 5 V i n Abr.522 pL 34
26
H o l l a n d , Re ( 1 9 0 2 ) 2 Ch.360
47
Hopgood V Brov/n ( 1955) 1 V/LR 213
97
Hounslow V Tv/ickenham
Garden Developments
Ltd.(.1970) 3 A l l E R 324
Hughes V M e t r o p o l i t a n RJ? ( 1 8 7 7 ) 2 Ap.Cas.439
119,122
15,35,43,44,45,46,47,48,57,60,63,
69,71,84,86,99,100,103,133
Humber Ferryman's
Case 22 Ass. 94 (No.47)
Humphreys P o l a k ( 1 9 0 1 ) 2KB 385
Hussey v Palmer ( 1 9 7 2 ) 3 A l l E R 744
20
101
128,139
I
I n w a r d s v Baker ( 1 9 6 5 ) 1 A l l E R 4^6
I v e s V H i g h ( 1 9 6 7 ) 1 A l l E R 504
109,110,111,129
111
J
Janson v D r i e f o n t e i n Mines ( 1 9 0 2 ) AC 484
54
Jones V P a d a v a t t o n ( 1 9 6 9 ) 1 WLR 328
56,114,137
J o r d e n v Money ( 1 8 5 4 ) 5 HL Cas. 186
23,29,31,33,43,46,47,69,137,138
xii
K
K e p p e l l V B a i l e y ( 1 8 3 4 ) My.& K 517
Kingsv/ood v Anderson
125
( 1 9 6 3 ) 2 QB 169
88
K n i g h t s V W i f f e n ( 1 3 7 0 ) LRV QB 660
42
L
L a l a B e n i Ram & A n o t h e r v Kundan L a l l e t a l LR X J V I 1A 58 ( 1899)
Lamb v V i c e ( 1 8 4 0 ) 6 M & W 467
124
L a m p l e i g h v B r a i t h w a i t ( I 5 l 6 ) 80 Eng.Rep. 255
Ledingham v Bermejo
16
E s t a n c i a Co. ( 1 9 4 7 ) 1 A l l E R 749
77,78
Le Neve v Le Neve ( 1 7 4 7 ) 1 Ves. 55
28
L e t a n g v Cooper ( 1 9 5 5 ) T QB 232
107
L i g g i n s V Inge (1831) 7 Bing.684
51
L l o y d ' s V H a r p e r ( 1 8 8 0 ) 16 Ch.D 290
124
29,47
L o f f u s V Moore ( 1 8 6 2 ) 3 G i f f . 5 9 2
London B o r o u g h o f Kounslow v Twickenham Garden Developments
3 A l l E R 326
57,71
Ltd.(1970)
95
London S t r e e t Tramways L t d v London C.C. ( 1 8 9 8 ) AC 375
Low V B o u v e r i e ( 1 8 9 1 ) 3 Ch. 82
L u d e r s v iVnstey ( 1799) 4 Ves. 501
L y l e - M e l l o r s v L e w i s ( 1 9 5 6 ) 1 A l l E R 247
41,44
49,56,81
27,136
101
M
Macnaghton v P a t ^ r s o n (.1907) AC 483
Marchon P r o d u c t s v Thornes ( u n r e p o r t e d ) ,
M a u n s e l l v Hedges ( 1 8 5 4 ) HLC 1039
Hay
V B e l l e v i l l e ( 1 9 0 5 ) 2 Ch.605
Mayut V Aklum ( 1 3 2 4 )
Merritt
v Merritt
( 1 9 7 0 ) 2 A l l E R 760
62
5
30,37
62
18
56,114
M e t c a l f e v Boyce ( 1 9 2 7 ) 1 KB 758
66
M i d l a n d S i l i c o n e s v Scrutt.on ( 1952) AC 446
10
M i n i s t r y o f H e a l t h v B e l l o t t i ( 1944) liB 298
99
iviogul S t e a m s h i p Co. v IiIcGregor Gow ( 1892) AC 25
11
M o n t e f i o r e v M o n t e f i o r e 1 WBL 363
24
xiii
Moore v H a r t
2 V e r n . 361
25
54
Morgan v Tate & L y l e ( 1 9 5 5 ) AC 21
103,104
Morrow v C a r t y ( 1 9 5 7 ) N . I . 174
M u t u a l L i f e Assurance
Co. v E v a t t ( 1 9 7 1 ) 1 A l l E R I 5 0
37
N
N a t i o n a l P r o v i n c i a l Bank v A i n s w o r t h ( 1 9 6 5 ) AC 1172
55,97,120
N e v i l l e v W i l k i n s o n 1 Bro cc 543
24
Newsholme v Road T r a n s p o r t G e n e r a l I n s u r a n c e (.1929) 2 IIB 356
64
N o r f o l k C.C.
V S e c r e t a r y o f S t a t e ( 1 9 7 3 ) 3 A l l ER 673
116,117
Nunn V F a b i a n 11 Jur.N.S. 868
'
32
0
Ogle V E a r l Vane ( 1 8 6 3 ) LR I I I
4I
;3D 272
O l y m p i c O i l & Cake Co. v Produce B r o k e r s ( 1 9 1 5 ) 112 LT 744
8
P
63
P a n o u t s o s v Raymond H a d l e y Corpn o f New Y o r k ( 1 9 1 7 ) 2 KB 473
Parker v Clark
(I96O)
1 A l l E R 99
106,107
P e r r o t t v Cohen ( 1 9 5 1 ) 1. KB 705
88,89
31,33,37,57,66,110,136
P i g g o t V S t r a t t o n ( 1 8 5 9 ) 1 De.G.F.& J 33
P i l l i n g V A r m i t a g e ( I 8 O 6 ) 12 Ves 78
38
P i n n e l ' s Case ( 1 6 0 2 ) 5 Co.Rep 1170
47,114
Plasticraoda S o c i e t a p e r A z i o n i v Davidsons (Manchester) L t d ( 1 9 5 2 )
1 LI.Rep.
93
527
P l i m m e r v W e l l i n g t o n Corpn ( 1 3 3 4 ) 9 App. Cas. 699
P o r t e r , r e W i l l i a m ( 1 9 3 7 ) 2 A l l E R 36I
49,58,108,136
35,63,71,77,78,104,138
133
P r i e s t l e y v Fowler (1837) 3 M & W 1
P r i n t i n g & N u m e r i c a l R e g i s t e r i n g Co. v Sampson ( 1 3 7 5 ) LR 19 EQ 462
P r o l e V Soady ( 1 8 6 0 ) 2 G i f f .
1
11,135
27,32,37
Q.
Quinn V Leatham ( 1 9 0 1 ) AC 495
10
R
Ramsden v Dyson (1366), LR I HL 129
R i c k a r d s v Oppenhaim ( 1 9 5 0 ) 1 A l l E R 420
/
36,33,50,53,70,110,111,115,135,139
41,81,84,85,36,89
xiv
Robertson v Min o f Pensions
75,81,83,84,86,117
Rodenhurst E s t a t e s v W H Barnes L t d (1936) 2 AllBR 3
67
Rookes V B a r n a r d ( I 9 6 4 ) AC 1129
55
Ruben v G r e a t P i n g a l l C o n s o l i d a t e d ( 1 9 0 5 ) AC 439
60
S
S a l i s b u r y v G i l m o r e ( 1942) 2 ICB 39
68,59,71
10
S e a r l e v W a l l b a n k ( 1 9 4 7 ) AC 391
105
S c h n e i d e r v E i s o v i t c h ( 1 9 5 0 ) 2 V/LR 159
S e t o n L a i n g v L a f o n e ( 1 3 8 7 ) 19 QBD
34
58
Shaw V D.P.P. ( 1 9 5 2 ) AC 220
10
Sheddon v G o o d r i c h 8 Ves. 481
44
S l a d e ' s Case ( 1 5 0 3 ) 4 Co. Rep. 925
20,21
S m i t h V Land & House P r o p e r t y C o r p o r a t i o n ( 1 8 8 4 ) 28 Ch.D.
7
53
123
S n e l l i n g v S n e l l i n g ( 1 9 7 2 ) t A l l E R 79
S o l l e V B u t c h e r ( 1 9 5 0 ) 1 KB 571
.
82,85
Spencer v Haramerde ( 1922) 2 AC 507
46
S p i e r s v M c C u l l y ( 1 9 2 5 ) NZLR 385
65
S t i l k V I J y r i c k ( 1809) 12 Comp. 317
85
Svenson v Payne (19455 71 CLR 531
70
Synge v Synge ( 1 8 9 4 ) 2 QB 462
106
T
Tabor v G o d f r e y ( 1 8 9 5 ) 64 LJQB 245
60,61,71,88,39,137,138
T a f f V a l e Ry Co. v Amalgamated S o c i e t y o f R a i l w a y S e r v a n t s ( 1 9 0 1 ) AC 425
10
T a n k e x p r e s s e A/S v Compagnie F i n a n c i e r e Beige des P e t r o l e s S A ( 1 9 4 9 ) AC 75
84
T a ^ a o r V Needham ( 1 8 1 0 ) 2 T a u n t . 278
97
T e r r i t o r i a l & A u x i l i a r y F o r c e s Assoc. o f t h e Co. o f London v N i c h o l s
( 1949) 1 ICB 35
81,85
Thomson v Weems ( 1 3 8 4 ) 9 App.Cas. 571
Tomlinson v G i l l
( 1 7 5 5 ) A m b l e r 330
53
14,30,123,125
T o o l m e t a l M a n u f a c t u r i n g Co. v T u n g s t e n E l e c t r i c Co. ( 1 9 5 5 ) 1 'TLR 7 5 l
1,46,
99,103,109,139
T u l k V Moxhay ( 1 8 4 8 ) ( 1 8 4 3 - 50) A l l E R Rep 9
125
XV
Tweddle v A t k i n s o n ( 1 8 6 1 ) 1 B.&
S 393
124
U
U n g l e y v U n g l e y 5 Ch.D.
U.S.
V Bethlehem
33
887
S t e e l Corpn ( 1 9 4 2 ) 315 US 289
11
U n i t y J o i n t - S t o c k B a n k i n g A s s o c i a t i o n v K i n g ( 1 3 5 3 ) 25 Beav. 72
38,108,130
W
Wakeham v M a c k e n z i e ( 1 9 6 8 ) 1 WLR
1175
38
W a l k e r v W a l k e r ( 1 9 4 7 ) 177 LT 204
79,81
Wankford v F o t h e r l e y ( 1 6 9 4 ) 2 V e r n . 322
26,37
V/ard V Byham ( 1956) 2 A l l E R 3I8
101,102,103
Ward V K i r k l a n d ( 1 9 6 6 ) 1 A l l E R 609
110,112,112,137
96
Webb V P a t e r n o s t e r Palm 71
Welch V Nagy ( 1 9 5 0 )
1 KB 455
85,86,87
117
W e l l s V M.H.L.G. ( 1967) 2. A l l E R
75,111,116,117
W e s t m i n s t e r Corpn v L e v e r F i n a n c e
West Y o r k c h i r e D a r r a c q v C o l e r i d g e ( 1 9 1 1 ) 2 IG 326
73
W h i t c h u r c h v Cavanagh ( 1 9 0 2 ) AC
59
W h i t e V N e a y l o r ( 1 8 8 6 ) 11 AC
Wickham, Re.
( 1 9 1 7 ) 34 TLR
117
171
96
158
35
W i l l i a m s v P i n c k n e y ( 1 8 9 7 ) 67 LJCh 30
Wilmott V Barber
LR
34
15 Ch. 96
V/ilson V D a r l i n g I s l a n d S t e v e d o r i n g Co.
44
95 CLR
43
22
W i n t e r v B r o c k w e l l ( 1 8 0 7 ) 8 East 3O8
W i n t e r Garden T h e a t r e v M i l l e n i i m P r o d u c t i o n s ( 1 9 4 8 ) AC
Wood V L e a d b i t t e r
51
173
94,95,121
I 3 M & W 833
V/oodhouse AC I s r a e l Cocoa L t d SA v N i g e r i a n Produce M a r k e t i n g Co.
2 A l l E R 127
Wroth V T y l e r ( 1 9 7 3 ) 1 A l l E R 897
95
( 1972)
2 W
.-"f .
131
82,118,120
INTRODUCTION
f
The object'' herein TTJUI be t o examine the nature of what has been termed variously as
1
2
3
promissoiy , equitable and quasi-estoppeL, and t o do so w i t h i n the wider context o f
of promise-enforcement
i n law. An account o f the development of t h i s doctrine w i l l be
attempted, together w i t h suggestions f o r i t s future growth. The dangers attendant upon
l e g a l s t a s i s w i l l be i n d i c a t e d , i n s o f a r as they concern t h i s area. I t w i l l be assumed,
b u i l d i n g upon Stone
and Pound , t h a t emphasis i s often misplaced, and t h a t law i s less
a body of r u l e s than a system f o r the r e c o n c i l i a t i o n o f claims asserted by i n d i v i d u a l s
and groups. The granting or refusing o f l e g a l recognition i s productive o f rules of a
pragmatic and mortal q u a l i t y , q u i t e lacking i n the omnibus and eternal a t t r i b u t e s
sometimes n o t i c e d from the Bench.
Two o f the more adventurous approaches t o the law o f contracts have been made by judges
who sought d e l i b e r a t e l y t o many equitable w i t h l e g a l p r i n c i p l e s . Lords Mansfield^ and
7
Denning . The n o t i o n o f the 'common law* i n t h i s , fused, sense, and as d i s t i n c t from
the
law o f the draftsman or o f the c i v i l i a n s , seems, l i k e t h a t j u r y , 'to i n v i t e accolades
g
clothed i n robust imagery. • I n i n s i s t i n g upon the proper f u n c t i o n of the common law
i n t h i s sense, i t i s hoped that such accolades may be avoided.
Footnotess
1
Tool Metal Manufacturing Go v Tungsten E l e c t r i c Go(1955)lWLR76l.
2
Spencer-Bower and Turners 'Estoppel by Representation 2nd ed p332.
3
Wilsons Recent Developments i n Estoppel 67|/3R330j A Reappraisal o f Quasi-estoppel
1965 CLJ93.
U
stone? S o c i a l Dimensions o f Law & Justice Chapter k-
5
Pound: I n t r o d u c t i o n to the Philosophy o f Law Chapter 2; 57HLR1.
6
Campbells 'Lives • - defends Mansfield, but i n W
7
3
but
view not merely unconvincingly
also unnecessarily. See K^eton & Sheridon: Equity I9i6k p69j Holdsworth:
. Blackstone's Treatment of Equity U3 HERl.
e g i n Central London Property Co v High Trees House Ltd(l9l;7)KB130 a t pl352
•At t h i s time o f day... when law and equity have been joined together f o r over
seventy years, p r i n c i p l e s must be reconsidered i n the l i g h t o f t h e i r combined
effect.»
Comishs The Jury 1970 pl38.
P T0
2
Daring the. middle ages, a formally s t r a t i f i e d society made easier the task o f reconciling
claims and recjognising i n t e r e s t s , f o r i t could be accomplished w i t h i n each l a t e r a l s o c i a l
division
9
10
and even w i t h i n each v e r t i c a l d i v i s i o n representing l o c a l i s e d j u r i s d i c t i o n s .
Subject t o the paramount claims of the superior j u r i s d i c t i o n , and increasingly as the
middle ages waned, t o t h a t o f the King, i n each s o c i a l group and community p r i n c i p l e s
could be a r r i v e d a t which would r e f l e c t the dominant s o c i a l values i n any age'l'''' The
Chancellor himself, f o r reasons o f expedience, appointed l o c a l laymen t o examine
witnesses i n areas remote from London and where possible, t o a r b i t r a t e i n disputes 'to
12
hear and end (them) according t o equity and good conscience,'
thus ensuring t h a t the
moves o f laymen should be r e f l e c t e d i n h i s system o f j u s t i c e . A cautious summary might
be t h a t as values changed, as new i n t e r e s t s and claims arose, they quick]y became the
subject o f p u b l i c a d j u d i c a t i o n before a t r i b u n a l of communal, feudal, or r o y a l j u r i s d i c t i o n .
Administration,
which i s bound t o have value judgements about society as i t s basis was
seen, even u n t i l the nineteenth century, as j u s t i c i a b l e , w h i l s t i n the twentieth century
j u s t i c e i s o f t e n seen as an administrative
concern.
FootnoteSt
The
famous remark 'Do not gloss the statute f o r we made i t and understand better
than you what i t means* (also Plucknettt I n t e r p r e t a t i o n o f Statutes pij.9) a t t e s t s t o
the closeness o f the j u d i c i a r y and l e g i s l a t u r e w i t h i n the l a t e r a l stratum a t the top
of society concerned w i t h the law o f the King's courts.
LO
See Dawson* A History o f Lay Judges 1960.
He indicates t h a t the l o c a l courts were
encouraged by the Royal Courts t o be, as i t were, closed c i r c u i t s .
|L1
Although, o f course, l e g a l development occurred by c r o s s - f e r t i l i s a t i o n , p a r t i c u l a r l y
as 'lower' groups gained i n s o c i a l significance. See MLlsoms H i s t o r i c a l Foundations
of the Common Law 1969 p8 'for most ordinary men and most ordinary causes the county
court was the highest regular forum... and therefore a p r i n c i p a l source o f things
t h a t w i l l s t r i k e us as n o v e l t i e s when we f i r s t see them transacted on the l i g h t e d
stage o f the r o y a l
courts.•
12
See Dawson op,;cit.
13
See e g Titrausst Welfare Rights, Law and Discretion. P o l i t i c a l Quarterly 1968 p l l 3 .
P T0
3
I n i t s e a r l y development, then, English law i s closely associated w i t h society which
i s i t s matrix because i t s courts are generally i n touch w i t h t h a t social group f o r
whomi they are adjudicating"!^ Only l a t e r do lawyers and laymen obtain t h e i r divorce i n
the
formal areas of noncriminal law, lawyers on the Bench seeming quite d e l i b e r a t e l y
to f a i l t o notice the requirements of those l i k e l y to be affected by t h e i r pronouncements.
I t was the Donoughmore Committee"^^ which pronounced the heresy of the inter-war years
and not Professor Laski"''^ i n the sense t h a t the former's boundary of the j u s t i c i a b l e
involved the assumption t h a t d i s c r e t i o n and public p o l i c y were unknown t o , and
unworkable by, the judges, w h i l s t the l a t t e r recognises t h a t 'law i s always made i n
17
terms of what l i f e has meant t o those who make the law.'
Today, the marriage of the
welfare-minded p o l i t i c i a n and the conservative lawyer could s i r e a most unfortunate
18
monster. .The l o c a l courts and, i n the pre-Stuart era, the c o n c i l i a r courts, and the
c o n t r o v e r s i a l l o c a l Courts o f Requests which survived u n t i l I8U6 when they were abolished
20
by the County Oourts Act, a l l gave judgements notorious t o those whom they served:
modem a r b i t r a t i o n procedures and so c a l l e d 'administrative' t r i b u n a l s , on the other
21
hand, are p r i v a t e and, i n p r a c t i c e , unsupervised
i n the m a j o r i t y of cases.
Footnotes2
U4
See White: Lawyers and the Enforcements of Rights,in Social Needs and Legal Action
(1973) eds Campbell, Carton and Wiles, f o r a discussion of the d i f f i c u l t i e s of
providing l e g a l solutions where courts are meant t o serve the whole of sociely
r a t h e r than p a r t i c u l a r sections of i t . He postulates 'A society which recognises a
continuing m u l t i p l e c o n f l i c t of i n t e r e s t s and values taking place w i t h i n an accepted
overarching s t r u c t u r e • of a more or less f l u i d or dynamic nature.'(pl7).
15
Report of the Committee on M i n i s t e r s ' Powers 1932,
Cmd li060.
16
See, e g, h i s A Grammar of P o l i t i c s Uth ed.
L7
O p c i t a t p^UU. See also Abel-Smith and Stevenst Lawyers and the Courts pl20.
L8
See % d n e y & Beatrice Webbs Local Government v o l I I
pTi-S^
They discovered t h a t
f i f t y Courts Baron were operational i n Northumberland and twenty i n Durham as l a t e
19
as
J^hlSee Winders Courts of Request 52LQR369.
?0
County Courts Act l8it6. 9&10
11
See Law Commissions Working Paper No I4.O - Revision i n Administration Law p^3 para 70.
71 ct c.95 (36 Statutes a t Large 313) Sections A & B.
P T 0
-
h
The argument i s t h i s s t h a t lawyers who a t t e r p t t o concentrate on mere l e g a l rules
produce d i s a s t e r . Had the property lawyers of the nineteenth century looked beyond t h e i r
22
d o c t r i n e s , contemporaiy food shortages might have been less severe. Moreover, w h i l s t
the lawyer might not greet w i t h enthusiasm the request t h a t he be imaginative, and look
23
to the other s o c i a l sciences, professor F i f o o t ' s comment upon Eastwood v Kenyon
that
Lord Denman's 'appeal t o h i s t o r y must be allowed. Whatever i t s value i n the modem law,
the doctrine of consideration s t i l l r e s t s upon the foundations l a i d by Elizabethan
lawyers'^^ might, w i t h respect, be tempered by the observation that had we r e l i e d upon
the Lord Denmans o f the j u d i c i a r y we should not have a law of contract. The law i s
dynamic by t r a d i t i o n , a t the hands of the judge, and also, i n s t r i c t l o g i c , f o r even
accepting i t as a body of r u l e s , the a p p l i c a t i o n of a r u l e which has been applied to a
previous set of f a c t s t o a new set, must a t t r a c t the d e f i n i t i o n o f c r e a t i v i t y .
There i s l i t t l e room f o r argument concerning the q u a l i i y of the j u d g * r o l e , only as
to the extent t o which he creates.
Footnotess
22
I n passing the S e t t l e d Land Act 1882 t o give the tenant f o r l i f e much wider powers
of dealing w i t h land subject t o a settlement 'the t r a d i n g purpose of the l e g i s l a t u r e
was t o prevent the decay o f a g r i c u l t u r a l and other i n t e r e s t s occasioned by the
d e t e r i o r a t i o n o f land and b i i i l d i n g s i n the possession of impecunious l i f e tenants."
Bruce v Ailesbury (l892 )AiS 3^6 a t p363 per Lord Watson, and Megarry and Wades Real
Property 2nd ed p287. L e g i s l a t i v e i n t e r v e n t i o n was necessitated by 'the f a c t t h a t
judges siriee I833 have shewn only l i m i t e d mastery over the fundamentals of
^
property l a w j the subject does not possess the f a s c i n a t i o n i t once did. ' SimpBons
I n t r o d u c t i o n t o the H i s t o r y of Land Law 196l p259. Surely t h i s i s because i t s social
s i g n i f i c a n c e i s diminished. ¥e s h a l l r e t u r n t o t h i s p o i n t .
23
• 181+0 11 Ad & e l U38.
2k
F i f o o t s H i s t o r y & Sources of the Common Law 19ii9 p U l l . See Atiyahs Consideration -
']
A Fundamental Restatement. Inaugural Address at the A u s t r a l i a n National University.
P T 0
Proponents of claims which do not achieve recognition i n the courts have open to them
two possible routes, both of which have disadvantages given the conservative climate
o f the j u d i c i a l ^stem.
The f i r s t i s recourse t o the l e g i s l a t u r e .
A group which cannot e f f e c t i v e l y mobilise
the l e g a l profession, or evoke sympathy from the Bench may use i t s p o l i t i c a l power to
bypass the courts and acquit s t a t u t o r y r e c o g n i t i o n f o r i t s claims?^-The drawback t h a t
i t i s s t i l l open t o the courts t o i n t e r p r e t the l e g i s l a t i o n i n accordance w i t h t h e i r
27
own p r e d i s p o s i t i o n s
may be overcome by repeated i n t e r v e n t i o n from Parliament, as has
occurred i n the trade union f i e l d , or by the s e t t i n g up of a separate system o f courts
28
not e n t i r e l y c o n t r o l l e d by professional lawyers.
The second route i s simply t o opt out o f the l e g a l system, and t h i s i s the route l i k e l y
29
t o be taken by the businessman. Even though a r b i t r a t i o n may cost more, and even though
the apparent f e a r t h a t trade secrets might be revealed during l i t i g a t i o n i s unfounded^*^
29
the courts continue t o compete unsuccessfully w i t h a r b i t r a t i o n procedures,
perhaps
because substantive law has lagged behind the requirements o f the commercial world?''" Yet
Footnotess
2^
Those seeking a ' r i g h t ' t o privacy might w e l l take t h i s route.
26
Following the extension of the franchise i n I867 t o
of the adult male population,
trade unions of the s k i l l e d working class were i n a p o s i t i o n to seek l e g i s l a t i v e
support.
27
See Abel janith & Stevens: Lawyers & the Courts p p l l 5 and I I 6 f o r a comment upon
the unfortunate Workmen's Compensation L e g i s l a t i o n .
28
C a l v e r t : Inaugural Lecture on the English Social Security System a t Newcastle
29
U n i v e r s i t y November 1971.
See Jacksons Machinery of Justice 6th ed p l l 8 .
l30
See Russell on A r b i t r a t i o n l 8 t h edo(Walton Q C ed)Preface. The unreported case of
Mar.Ghon.ProductS v Thomes i s c i t e d ( a t p l 6 l ) to i n d i c a t e the e f f e c t i v e use of an
i n j u n c t i o n t o r e s t r a i n the improper use of trade secrets.
31
L i t t l e e m p i r i c a l research has been c a r r i e d out i n England i n t o t h i s problem, but
see Macaulays Noncontractual Relations i n Business - A Preliminary Study 28 Am
Soc Rev 55 f o r an i n v e s t i g a t i o n o f the s i t u a t i o n i n the State o f Wisconsin.
P T 0
• .
there are f o r c e f u l reasons f o r wishing t h a t businessmen would l i t i g a t e more, and the
32
c a l l f o r a Court o f A r b i t r a t i o n
may have m e r i t , especially now t h a t there i s a general
tendency away from the omnibus courts set up i n 1875 towards more specialised ' bodies.
33
As Walton i n d i c a t e s
'no court can (or ought t o ) disgiiise the f a c t t h a t a dispute
between p a r t i c u l a r p a r t i e s i s i n progress (as an a r b i t r a t i o n can), but i f a p a r t i c u l a r
person i s always involved i n disputes - even though t h a t be h i s misfortune - i t may
not
be the beist p u b l i c p o l i c y to conceal the f a c t . •
More i m p o r t a n t l y f o r the law, 'the law must r e t a i n s u f f i c i e n t hold over ( a r b i t r a t i o n
procedures) t o prevent and redress any i n j u s t i c e on the p a r t of the a r b i t r a t o r , and to
secure t h a t t h a t law t h a t i s administered by an a r b i t r a t o r i s i n substance the law of
the land and not some homemade law of t h a t p a r t i c u l a r a r b i t r a t o r , or t h a t p a r t i c u l a r
•3!
arbitration.'
I n the words o f Scrutton, L J 'there must be no A l s a t i a i n England,
where the king's w r i t does not run.'^^ The r e l a t i v e independence of the businessman
r e s u l t s not merely from the enormous
and growing power of organisations which are
r i c h e r than many nation-states and which seek a c t i v e l y t o overthrow regimes which they
do not favour, but also from the nature of r e l a t i o n s h i p s between organisations of a l l
sizes i n which day-to-day a f f a i r s are c o n t r o l l e d by managers, 'ffenagers... are not very
keen on l i t i g a t i o n . They do not mind very much whether they win or loses what "theywant
to do i s to get the t h i n g o f f t h e i r t a b l e . '"^^ Disputes between commercial firms are
Footnotess
32
See 1958 JBL 1.
33
Russell on A r b i t r a t i o n l 8 t h ed Preface.
3k
Czarnikov v Roth Schmidt (1922 )2KB378 a t pii8i; per Bankes L J.
35
Op c i t a t pi;88.
36
S i r Roger Ormrod 'The Reform of Legal Education' 5 J A L T 77 a t p83.
'
He makes the p o i n t a t p82 t h a t 'the courts are seen as the s o r t o f nucleus o f the
whole operation' w i t h the 'law c i r c u l a t i n g around.' This he seeas as mistaken. I f
the advisory r o l e of the lawyer becomes much more important, f o r the reason given
i n the c i t e d quotation, and upon which Ormrod 'would be prepared t o take a gamble'
the problem of maintaining contact between the law and practice w i l l increase. The
s o l u t i o n , apart from a greater j u d i c i a l w i l l i n g n e s s to innovate, would seem t o be
i n attaching a greater weight to j u r i s t i c w r i t i n g s . They i n t u r n w i l l have to r e l y
7
l i k e l y t o occur w i t h i n a continuing r e l a t i o n s h i p productive o f mutual advantage, and
i n . a given focus o f trades there are l i k e l y t o be r e l a t i v e l y few firms. This s i t u a t i o n
provides i n c e n t i v e t o evolve r u l e s and dispute-^resolving mechanisms which are f l e x i b l e
and give l e a s t offence t o e i t h e r sides i n other words r u l e s and sanctions develop which
37
are consonant w i t h commercial m o r a l i t y . As Lord Devlin-'^' says, the merchant does not
have t o take the law as he f i n d s i t and sees no p r o f i t i n gaining a technical advantage
over a person or organisation w i t h whom he wishes t o continue t r a d i n g .
Professor Macaulay reports t h a t a l l of the purchasing agents whom h i s researchers
interviewed'-'expeeteci to be able t o cancel orders f r e e l y subject only t o an o b l i g a t i o n . t o
pay f o r the selXer'^'s major expenses'.Cancellation was frequently accepted "by a l l o f the
39
sales personnel interviewed.
Gower suggests t h a t i n England 'what seems t o be happening
i s t h a t the businessman p r e f e r s t o s e t t l e h i s disputes out o f court, even though t h a t
court be an a r b i t r a l t r i b u n a l . ' ^ ^ I n e v i t a b l y practices w i l l develop o f which the courts
w i l l have no knowledge, and o f which they may w e l l u l t i m a t e l y disapproved The danger
i n there being ' A l s a t i a s ' i s obvious, and the l i k e l i h o o d i s veiy great. Their existence
i s a measure o f the law's inadequacy.
Footnotes?
37
Devlins The R e l a t i o n between Commercial Law and Commercial Practice 1UMLR2U9.
38
Macaulayi Non Contractual Relations i n Business - A Preliminary Study 28 Am
Soc Rev
i
See Noelle & Schmidtchen t The Significance of Mass Surveys i n Public L i f e l U ISSJ283.
Where i t i s suggested t h a t opinion surveys reveal a 'new idea o f man.' Information
gathered i n t h i s way may be u s e f u l to lawyers i n the future f o r , since 1875 the
decline o f the c i v i l j u r y has meant t h a t the layman has l i t t l e voice i n the c i v i l
l e g a l process.
39
The law r e l a t i n g t o breach o f contract i s s i m i l a r i n Wisconsin, t o English law. See
T r e i t a l s Contract 3 r d ed p727s Hochster v Dela Tour (1853)2 E&B678; Restatement s 318.
ho
Law & Public Opinion i n England i n the 20th Century 1959 pl70.
hpL
See, e g the former p r a c t i c e o f s o l i c i t o r s , disapproved i n Brown v C I R(196i;)3 A l l
B R 119, o f r e t a i n i n g the i n t e r e s t a r i s i n g from deposit accounts containing c l i e n t s '
money, i n c e r t a i n circumstances.
P T0
8
' There i s no comparable measure a v a i l a b l e t o i n d i c a t e the d i s s a t i s f a c t i o n of the ordinary
i n d i v i d u a l w i t h the state o f the law. A request f o r change i n a p a r t i c u l a r area on h i s
behalf must r e s t on such vague notions as the current conceptions of j u s t i c e ^ ^ and
, u t i l i t y . Viewed a t large these notions are i d e a l s or maxims merely, but placed i n context
I and a p p l i e d t o p a r t i c u l a r issues I s h a l l argue t h a t they can provide coherence i n a
I
I
I dynamic system o f law: f o r ' a l l a c t i o n i s subservient t o some end^ and rules of action^
I
j i t seems n a t u r a l t o suppose, must take t h e i r whole character and colour from the end
to which they are subservient. When we engage i n a p u r s u i t , a clear and precise
conception of what we are pursuing would seem to be the f i r s t thing we need instead of
the l a s t t h i n g we look towards.'^"^ I t i s i n t h i s s p i r i t t h a t I hope t o examine the law's
a t t i t u d e towards
promises.
I have argued t h a t a j u d i c i a l decision must create law. Inseparable from any c r i t i c a l
discussion of the law i s c r i t i c i s m or evaluation o f the use t o which judges put t h i s
f a c i l i t y . Only by becoming f u l l y aware t h a t they possess i t can they hope t o create a
law which i s r e l e v a n t t o those t o whome i t applies. ' I f the law i s t o stand f o r the
f u t u r e as i t has stood f o r the past, as a sustaining p i l l a r of society, i t must f i n d
some p o i n t o f reference more u n i v e r s a l than i t s own i n t e r n a l l o g i c . ' ^ I t cannot be
s u f f i c i e n t to say t h a t ' I am unable t o adduce any reason t o show t h a t the decision
t h a t I am about t o pronounce i s r i g h t . . . B u t I am bound by a u t h o r i t y which i t i s ny
Iduty t o f o l l o w . ' ^ ^ Donaldson, J, i s much more p r a c t i c a l s ' . . . I should be sxirprised
i f the law compelled me t o f i n d i n the p l a i n t i f f ' s favour, because, contrary t o popular
b e l i e f , the law, j u s t i c e , and common sense are not unrelated concepts.'^^
Footnotess
k2
1 accept the analysis of j u s t i c e provided i n Rawlss A Theory of Justice.
i3
J S M i l l s U t i l i t a r i a n i s m Everyman E d i t i o n p2.
^k
R a d c l i f f e s The Law and i t s Compass p l i t .
4.5
Olympic O i l and Cake Co v Produce Brokers (1915) 112 L T 7iUi a t p7i|8 per Buckley,
L J. See Cohns E x i s t e n t i a l i s m and Legal Science f o r a c r i t i q u e of t h i s type of
approach.
ll6
Durham Fancy Goods v Michael Jackson (1968) 2QB839 a t p8ii7.
P T 0
k9
I t i s urged t h a t Lord Devlin
i s unduly pessimistic i n assuming t h a t the creative
f u n c t i o n of the common law i s a t an end, f o r the a l t e r n a t i v e , ' l e g i s l a t i o n . . . i s a
cumbersome process. Parliamentary time i s i n modern times n o t o r i o u s l y l i m i t e d and
may
) 7
w e l l i n f u t u r e become ever more precious,'
and i n any event 'the cassus improvisus
i s always w i t h uss and i n nineitynine cases out of a hundred i t must be s e t t l e d before
Parliament can act. The appeal i s made, not t o laws, f o r there are none, but t o Law,
c a l l i t what you w i l l - the common law, the p r i n c i p l e s of jurisprudence - anything from
the j u s summum t o commonsense, from the recto r a t i o to a square deal; i t i s on and by
1A
t h a t s t u f f t h a t judges have t o work, and they must do so not as bondsmen but as f r e e . '
Recognition o f the v i t a l r o l e o f the judge i n shaping the law i s given i n the c i v i l
law countries. ' I t i s not generally r e a l i s e d t h a t the number of decisions c u r r e n t l y
reported i n France probably exceeds t h a t of the United Kingdom... thus a more rapid
e v o l u t i o n o f the law i s possible t h a t i n England. '^"^
This i s not t o 'run the r i s k of f i n d i n g the archetypal image of the judge confused i n
men's minds w i t h the very d i f f e r e n t image of the legislator.'^"'" J u d i c i a l innovation i s
i n t e r s t i t i a l , i t must conform w i t h 'the vast body of substantive propositions... the
great r e s e r v o i r o f p r i n c i p l e s a v a i l a b l e f o r the making o f law... which... a t the same
52
time sets l i j n i t s t o the judge's power of choice.'
W h i l s t the problem case must f a l l
to the judge he i s l i m i t e d i n h i s e x p o s i t i o n o f what the law should be t o the facts
before him, i n contrast to the much wider scope of the l e g i s l a t o r .
Footnotes;
U7
Select Committee on Supreme Court Practice and Procedure 1953 Cond 8878 (Final Report).
I1.8
Shaws L e g i s l a t u r e and J u d i c i a r y 1911; plU c i t e d Abel Smith and Stevenss Lawyers
and the Courts p2U. An 'accolade clad i n robust imagery' perhaps.
i;9
Devlins 1956 Current Legal Problems.
50
Amos and iWaltons I n t r o d u c t i o n t o French Law 2nd ed p 11 . See also Cohn and
Zdzieblos I Manual o f German Law BllGL Comparative Law Series No lU f o r a discussion
51
52
of j u d i c i a l lawmaking, e g i n r e l a t i o n t o BGB s 2U2.
R a d c l i f f e s The Law and i t s Compass p l i ; .
Jaffes English and American Judges as Lawmakers p36
P T 0
10
52
Jaffe's p o i n t
t h a t lawmaking can be successful only where judge and l e g i s l a t o r
collaborate demands acceptance. J u d i c i a l performance i n giving e f f e c t t o the i n t e n t i o n
53
of Parliament has been poor
and capricious use has been made o f the 'rules' o f
s t a t u t o r y i n t e r p r e t a t i o n . S i m i l a r l y , performance i n shaping the law i n conformity wih
contemporary, s o c i a l l y - c o n s t r u c t e d r e a l i t y ^ ^ has been spasmodic?^ The judges c l i n g t o
the d o c t r i n e o f stare d e c i s i s and assert the need f o r c e r t a i n t y as though s o c i a l change
might be ignored. 'Nor w i l l I e a s i l y be l e d by an undisceming zeal f o r some abstract
j u s t i c e t o ignore our f i r s t duty, which i s t o administer j u s t i c e according t o law, the
law which i s established f o r us by Act o f Parliament, or the binding a u t h o r i t y of
precedent?^ The same learned l o r d managed t o locate i n a criminal court, however, 'a
r e s i d u a l power t o enforce the supreme and fundamental purpose of the law.,^7
Footnotes:
53
See Fisher v Bell(196l)lQB39l; ( R e s t r i c t i o n of Offensive Weapons Act 1959 s 1 ) .
Also Chandler v DPP(1961i)AC763 and Thompson: The Committee o f 100 and the O f f i c i a l
Secrets Act 1911. 1963 Public Law p201.
51;
Berger & Luckmann 1966 'The Social Construction o f R e a l i t y ' explain a t length the
i m p l i c a t i o n s o f t h i s phrase. I n more l e g a l terminology we might discuss 'the
reasonable expectations o f reasonable man,' perhaps.
55
e g T a f f Vale Case(1901)ACU26
Quimn y Leatham( 1901) ACli95
Searle v Wallbank(i9l;7)AC391
Eaglewell v Needham (1972) 1 A l l E R Ijl? (action on a b i l l dismissed on a
technicality).
But see Dutton v Bognpr Regis (1972) 1 A l l E R U62 ( l i a b i l i t y of Local A u t h o r i t y
f o r f a i l u r e o f i t s Inspector t o inspect the foundations o f a bungalow. Donoghue v
Stevenson was applied. See p a r t i c u l a r l y the judgement o f Sachs,L J, pkB3'^ & Lord
Denning, M R, pU72b).
B r i t i s h R a i l v Herrington (1972) 1 A l l E R 7l49 ( L i a b i l i t y o f negligent occupier
for accident s u f f e r e d by c h i l d trespasser).
^6
Midland Silicohes-^v Scruttons (1962 )AC kh^ a t pU67 per Viscount Simonds.
^7
Shaw V DPP(1962)AC220.
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u
H i s t o r i c a l l y , no doubt the declaratory view of law was u s e f u l , i n removing 'trouble'
cases from the preview o f the executive of Blackstone's times and by adhering to i t the
'iavidious retrospectiveness of j u d i c i a l l e g i s l a t i o n noticed by Bentham might be less
apparent. I t i s tempting t o speculate whether 'the movement of progressive society
FROM STATUS TO CONTRACT'^^ noticed by S i r Henry Maine, which reached i t s apotheosis i n
the l a s t century^^ d i d not play a p a r t i n d e t r a c t i n g the judge. I n the United States,
where freedom of contract was then teii?)ered by a r e a l i s a t i o n t h a t extreme competition
leads u l t i m a t e l y t o monopoly^^ judges have played a more p o s i t i v e part i n lawmaking^"'" and i n
seeking the substance behind the form^^ A modem r e t u r n to a society more concerned w i t h
questions a k i n t,o those i n v o l v i n g status has l e d to an enlargement of the f i e l d i n
which a d j u d i c a t i o n takes place, though the new courts are f o r the most part purposedesigned, and the adjudicator takes h i s premisses from the state.
That the apparently n e u t r a l , precedent-bound approach e x i s t s only i n fantasy, there i s
no need t o r e i t e r a t e . I t i s impossible to create a functioning model out of the materials
supplied by the doctrine o f precedent^"^ Seidman indicates the reason why a p a r t i s
Footnotess
:58
Maines 'Ancient Law' I 8 6 I Oxford 1959
plUl.
I59
Witness S i r George J^6?i, M R i n P r i n t i p g & Numerical Registering Co v Sampson
(1875 )IJ^ 19 EQ li62 a t pli65j t h a t ' i f there i s one t h i n g more than another which
p u b l i c p o l i c y requires i t i s t h a t men of f u l l age and competent understanding
shall
have the utmost l i b e r t y o f c o n t r a c t i n g , and that t h e i r contracts when entered i n t o
free.ay,.... s h a l l be held sacred and s h a l l be enforced by courts of j u s t i c e . ' Cited
Cheshire & F i f o o t 'Contract 6 t h ed p21.
(^0
Hence the Sherman Act of 1890.
c f ^bgul SS Co v McGregor Gow (l892)AC25. Though
see the discussion of the r e n e g o t i a t i o n decision US v Bethlehem Steel (19U2) 3l5
U S 289 i n Friedmanns Law i n a Changing iSociety 2nd ed Chapter U.
^1
See Crosss Precedent 2nd ed. Also Goodharts Precedent i n English and Continental
Law 50 LQRUO and p a r t i c u l a r l y Stones The Ratio* of the Ratio Decidendi,22 MLR 597;
Legal System and Lawyers' Reasonings ch7.
^2
Seidmans The J u d i c i a l Process Reconsidered 32 MLR 5l6 at p530.
P T0
12
missing from the received version o f the models 'To admit t h a t judge-made law...
represents the value choices of the decision-makers i n society i s t o admit that the e n t i r e
corpus o f the law... represents the values... of those s t r a t a i n society pro ten¥)ore
i n c o n t r o l . '^^ However, I suggest that t h i s j u d i c i a l unwillingness may at l a s t achieve
the opposite e f f e c t on some issues, and deny the manifest views of those s t r a t a and
others.
I t i s not considered t h a t judges should 'repossess themselves of the freewheeling powers
o f a Coke or a Mansfield'^^ but t h a t they should respond i n a p o s i t i v e fashion to the
requirements o f society. I n t h i s way reform of the law r e l a t i n g t o promises i s possible.
Twenty years ago. Denning believed^^ t h a t i t was possible t o implement the proposals
i n the law Reform Committee's S i x t h I n t e r i m Report^^ but
I : s h a l l argue t h a t the judges
can aim higher than t h i s .
I s h a l l look a t the o r i g i n s o f c o n t r a c t u a l o b l i g a t i o n t o see how f a r t h i s i s connected
w i t h the idea of pacta sunt servanda, and a t the growth of the consideration doctrine.
At somewhat greater l e n g t h I s h a l l examine the use of Estoppel t o enforce representations
of i n t e n t i o n . I n Simon v Anglo-American Telegraph^^ Bramwell, L J said ' I do not wish
t o speak against estoppels, f o r I do not know how the business of l i f e could go on i f
the law d i d not recognise t h e i r existence.' I., s h a l l examine t o what extent the doctrine
has been used as a subsidiary o f consideration, even t o what extent i t has on occasion
s u f f e r e d from i l l - s u i t e d analogy w i t h consideration, and whether i t has an independent
r o l e i n England, such as t h a t conferred upon the American doctrine of promissory estoppel.
I t w i l l be necessary t o ask whether disservice has not been done t o the concept of
consideration^^ by an unwillingness t o enforce promises^^ and whether i t may not gain
coherence from being confined.
Footnotess
63
Jaffes E n g l i s h and American Judges as Lawmakers p36.
61;
Denning: Recent Developments i n the Consideration Doctrine l 5 MLR
65
Cond'5i;U9.
66
(1879) 5 QBDI88.
67
See Restatement of the Law o f Contract S 90.
68
See A t i y a h : Consideration i n Contracts.
I
1.
See e g De l a Bere v Pearson(1908 )1KB 280; Gore v Van der Lann(1967)2 Q B 31 .
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13
I t i s proposed to consider the licence cases and the 'holding-out'cases, and to make
some proposals f o r the f u t u r e . And throughout I hope to emphasise the proper role of
law as, i n Fleming's words 'dedicated to the r a t i o n a l s o l u t i o n of social c o n f l i c t . '
And
because law i s only a means, not an end, i t f a l l s to be adjudged, not by any i n t e r n a l
70
standard, but by the degree to which i t f u r t h e r s relevant s o c i a l ends'.
t o Weber's ' r a t i o n a l substantive'
I t approximates
category i n i t s proper f u n c t i o n - i t i s 'guided by
71
general r u l e s , t y p r i n c i p l e s of an i d e a l o g i c a l system other than t h a t of law
itself,
not, as some lawyers would have i t , t o the ' r a t i o n a l , formal, l o g i c a l ' 'idealtyp.'
I cannot agree w i t h Lord Denning t h a t the academic lawyer i s 'not concerned as
72
p r a c t i t i o n e r s are, only w i t h the law as i t i s '
because we cannot accept t h a t the
a p p l i c a t i o n of an abstraction or an analogy i s l o g i c a l l y j u s t i f i e d other than by
reference t o an 'ought' proposition, the 'ought' being derived e x t e r n a l l y . The c o l l e c t i o n
of laws available to academics and p r a c t i t i o n e r s are, h i s t o r i c a l statements or
abstractions,
j i n e r t s only an 'ought' can breathe l i f e i n t o them. I t cannot be s u f f i c i e n t l y emphasised
t h a t there i s nothing i n t r i n s i c to the present t h a t without more enables us t o r e f e r
[ i t to the past. We
r e f e r t o an object as an 'apple' not because i t i s inherently an
pple, but because we t h i i i k we diould, f o r the purpose of communication, or so as to
fcevelop an understanding of the universe. I f e i t h e r purpose, or ary other, ceased to
3e f u l f i l l e d , we should be wise t o divide our observable universe d i f f e r e n t l y . I f we
Lose sight of t h i s , we s h a l l become, as Wittgenstern remarked 'betwitched' by words.
i f i n a l points throughout I s h a l l be concerned w i t h the provision of remedies. For t h i s
Durpose i t s t i l l seems worthwhile to draw d i s t i n c t i o n s between law and equity, and, i n
o i n t i n g the way
t o the establishment of a more comprehensive and f l e x i b l e theoiy of
abligations, r e s p e c t f u l l y t o r e j e c t Professor Atiyah's suggestions r e l a t i n g to the
sxpansion of the f i e l d of contract, i n favour of a more equitable s o l u t i o n . However,
as the growth of the t r u s t from i t s o r i g i n as the s p e c i f i c performance o f t h i r d parly r i g h t s
b'otnotess
0
Fleming on Torts Uth ed preface.
1
Weber on law i n economy and society. I n t r o d u c t i o n by Rheinstein p6.
Dennings The Way
of an Iconoclast 3 Syd L Rev
209.
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11;
i n contracts shows, the p r o v i s i o n o f a remedy may a t times r e s u l t i n the creation of
73
an i n s t i t u t i o n , or ' i n t e r e s t . '
That t h i s may be an awkward r e s u l t should not deter
us-^unduly i f we remember t h a t , so long as the i n t e r e s t remains dependent upon the
remedy, and so long as the remedy i s a v a i l a b l e only where equity and j u s t i c e require
i t , f l e x i b i l i t y w i l l be r e t a i n e d and innovation kept w i t h i n the bounds o f the
practicable.
Footnotes;
73
See, f o r example, the d i f f i c u l t i e s encountered i n Binions v Evans (1972) 2 A l l E R
|0. But see the discussion of, i n t e r a l i a , Tomlinson v G i l l ( 1756)Ambler 330 i n Carbins
Contracts f o r the Benefit of a T h i r d Party, i n 1;6 LQR12.
15
Isl
I t seemed t o Lord Cairns, L C axiomatic t h a t h i s was 'the f i r s t p r i n c i p l e o f equity'.''• "
His
remark, has puzzled commentators, y e t the s o l u t i o n may be i n the nature o f equity.
H i s t o r i c a l l y , the 'conception ( o f disparate systems) has had important e f f e c t s on our
jurisprudence. Reliance on equity t o bring about a balance between l e g a l r i g h t s and
persons who would be seriously harmed by t h e i r s t r i c t enforcement has retarded the
independent moral growth i n the main body o f the law. '"^ Equity, too, has suffered
'arrested development' as a r e s u l t . I t i s surely no coincidence t h a t the two judges t o
have made l e a s t o f the d i s p a r i t y . Lords Mansfield and Denning, have t r a v e l l e d f a r t h e s t
toward l e g a l enforcement o f e t h i c a l l y binding promises.
I s h a l l attempt t o shew t h a t equitable estoppel must be seen i n context o f the enforcement
of promises o f t h i s nature. I s h a l l survey, o f necessity a t second-hand, the emergence
of a theory o f contract i n e a r l y equity and i t s treatment of promises; then I s h a l l
postulate t h a t the re-emergence o f t h i s theory, strongly supported by arguments o f
morals and e f f i c a c y , and f a c i l i t a t e d by the Act o f 1873 goes f a r t o explain a number
of apparently only p a r t i a l l y r e l a t e d phenomena - v i z ,
the licence cases and the congress
of promissory estopped cases. The hypothesis w i l l be s c i e n t i f i c i n Popper's sense; i t
w i l l be subject t o ' f a l s i f l a b i l i t y . '
Jones^ suggests t h a t the chancellor's j u r i s d i c t i o n over contract i s based upon
procedure. I n granting s p e c i f i c performance the a t t e n t i o n o f the chancellor i s directed
t o the precise nature o f the promise, and he i s less concerned w i t h the wrong done t o
the
promisee. He i s moved t o a f f e c t the conscience o f the promissor. Perhaps there i s
a more s t r a i g h t f o r w a r d reason why the chancellor may i n c l i n e t o view promises as
i n h e r e n t l y v a l i d . The Royal Courts allow a w r i t o f covenant t o enforce a promise as
e a r l y as 1201, and i t becomes the sole remedy of the termor f o r a time. To begin w i t h ,
the
form of the agreement i s not s e t t l e d , nor i s the subject matter, so t h a t a sealed
Footnotess
1
Hughes V Metropolitan Ry (1877)2 Ap Gas k39 a t p 450.
2
Wilson, a t LQR 67s 330 & CLJ 1965s 93; Gordon CLJ 1963s 222, who seem t o be rather
at cross-purposes w i t h the aims o f Lord Denning.
Newmans^- Equity and Law, a Comparative Study I 9 6 I ppl2 & I 3 .
Joness The Elizabethan Court o f Chancery.
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16
document i s merely evidence, and s e i s i n need not be alleged. Over perhaps h a l f a century
the deed ceases t o be merely evidence however, and becomes the contract i t s e l f . . . i t
develops 'an operative force of i t s own which i n t e n t i o n s expressed, never so p l a i n l y ,
i n other ways, have n o t ' ^ This e v o l u t i o n suggests t h a t the source of the o b l i g a t i o n i s
the promise contained i n the deed; f o r implied i n a concentration upon the f i n i s h e d
product as w r i t t e n down t h a t u l t i m a t e l y leads t o an ignoring of what l i e s behind i t ,
i s a l i g h t regard f o r the motivation which produced i t . I n other words, although Pollock
and Maitland r e f e r t o 'agreement,' there i s no suggestion t h a t the Common Law would not
enfoce a u n i l a t e r a l conventio, even before the requirement of w r i t i n g .
L i t t l e i s known about the e n f o r c e a b i l i t y of promises i n the l o c a l courts f o r 'the County
Court , r o l l s o f pleas were not kept i n the preservative a i r o f o f f i c i a l d o m , but l y the
6
7
S h e r i f f s themselves,' y e t ' i t may be t h a t cases l i k e t h a t of Lampleigh v Braithwait
g
again r e f l e c t a general r u l e about promises i n l o c a l courts.'
This general r u l e , about
which there can be no more than informed speculation, may have exhibited a divergence
from subsequent common law s i m i l a r t o the r u l e of modern German law, under which, f o r
example, a buyer's primary remedy against a d e f a u l t i n g s e l l e r i n a Sale o f Goods
9
contract i s s p e c i f i c performance o f the promise, r a t h e r than damages. I n French law
a promise i s enforceable subject t o i t s having a l a w f u l 'cause,' but regardless of
whether i t i s a contrat de bienfaisance or an onerous contract.'^^
Again, the laws o f Switzerland, A u s t r i a , Mexico and Louisiana, o f Norway, Sweden,
Denmark, and of Pennsylvania"^ seek t o give e f f e c t t o promises i n c e r t a i n
circumstances.
Footnotess
5
Pollock & Maitland l i s 220. Also Chapter 5 generally.
6
Milsom's I n t r o d u c t i o n t o P & M's History o f English Law,
7
8
Ixiii
( I 6 l 6 ) 80 Eng Rep 255MLlsoms H i s t o r i c a l Foundations p3l5'
See Gebhardts Pacta Sunt Servanda lOMffi 159 and generally Cohns Manual o f German
Law v o l 1.
10
Amos & Walton: I n t r o d u c t i o n t o French Law 2 ed Chapter 8.
11
Equity & Law/ A Comparative Study p25lP T0
17
Notwithstanding the e f f e c t s o f d i f f u s i o n and borrowing, i t i s possible t o suggest t h a t
these j u r i s d i c t i o n s place erapiiasis upon the promise because i t i s convenient t o do so,
and because not t o do so may o f t e n be contra bonos mgres. The early English Ohancellors
may borrow from Canon Law, but only t o the extent t h a t t h i s suits the nature of t h e i r
12
j u r i s d i c t i o n . Barbour
f i n d s the Chancellor enforcing parole contracts i n the f i f t e e n t h
century and asks 'did (he) enforce the o b l i g a t i o n because breach of the promise amounts
to a t o r t , or because he holds t h a t one who has f o r l e g i t i m a t e cause made a promise
ought t o carry i t out?'
The l a t t e r reason i s more d i r e c t , and I suggest t h a t adoption of t h i s approach by mary
J u r i s d i c t i o n s a t t e s t s i t s convenience. Examination of the plea r o l l s , Barbour says,
suggests i t t o be the more l i k e l y . The pleas stress the promissor's f a i t h , not his
d e c e i t ; the cases shew b e n e f i c i a r i e s not a party t o the agreement moving the Chancellor
t o uphold promises i n t h e i r favors 'Where p l a i n t i f f , a t A's request, becomes A's surety
f o r a debt owed by A t o B, the p l a i n t i f f does not seek a remedy i n deceit, but alleges
an i m p l i e d promise by A t o discharge him a promise which the Chancellor w i l l
enforce.
l ^ t h Century e q o i t y w i l l enforce promises qua promisis so f a r as t h i s accords w i t h
'reason and conscience.' 'God acts as attorney t o f o o l i s h people,' Bishop S t i l l i n g t o n
remarks"!"^ This i s not t o suggest t h a t equity would enforce a bare promise i n a l l
circumstances, or t h a t the medieval doctrine of 'causa' was a t a l l absent, indeed ' i t
looks very much as i f causa has been contaminated by i n s u l a r notions of quid pro quo.'"^
Without examining contemporary views of causa, i t i s s u f f i c i e n t t o notice t h a t there
e x i s t e d i n equity a d i r e c t and l o g i c a l approach t o contract capable of f l e x i b i l i t y and
expansion. A s i m i l a r f a c i l i t y probably existed i n the courts of l o c a l i i i r i s d i c t i o n Footnotes^
12
Barbourj H i s t o r y of Contract i n Early ^ l i s h Equity. Oxford Studies i n Social
and Legal H i s t o r y Cedjinogradoff) i v .
13
lii67 YB 8edwIV,, f i ^ l l p l . . c i t e d by Vinogradoffs Reason & Conscience i n Sixteenth
li;
Centuiy Jurisprudence 2i|IQR 373 a t p380.
J L Barton. The E a r l y H i s t o r y of Consideration. 8^LQR 372.
P T 0
18
counly courts, courts baron and pie powder courts"!"^
This contrasts w i t h the common law s i t u a t i o n , which l e d Holmes t o say that »the duty
t o keep a contract a t common law means a p r e d i c t i o n t h a t you must pay damages i f you
break i t . * ' ' ' ^ The contract i s 'not a promise t o pay damages, but an act imposing a
l i a b i l i t y t o damages n i s i . l o u commit a t o r t and are l i a b l e . l o u commit a contract and
17
are l i a b l e xinless the event agreed upon... comes t o pass.'
Holmes' analysis, odd though i t may sound, i s u s e f u l because h i s t o r i c a l l y accurate. The
common law, a u t h o r i l y has i t , enabled the prommisee t o enforce a promise by a w r i t of
Covenant. The r e s t r i c t i o n s placed by a f a i l u r e , perhaps, t o d i s t i n g u i s h substantive
and e v i d e n t i a r y r u l e s , were not unduly onerous t o those who wished t o use the common
law courts, and there was no, pressure on the common law judges t o develop r u l e s about
commercial agreements and parole contracts.
Pressure came, however, w i t h the end o f the middle ages, from a v a r i e t y o f causes,
u l t i m a t e l y economic. I n f l a t i o n followed the Black Death and was exacerbated by the
i n f l u x o f American s i l v e r s commercial adventures grew i n scale and p o l i t i c a l significance.
The f o r t y - s h i l l i n g l i m i t drove actions from the l o c a l courts, and the Crown became
concerned t o s a t i s f y the l e g a l expectations o f merchants, English and foreign. I t
accomplished t h i s through c o n c i l i a r courts e? a process attended, i n the p a r a l l e l
Footnotes8
15
Mayut V Aklum (l32l)): parole contract upheld
'according t o the usages o f
Scarborough' c i t e d Vinogradoff op c i t p38U. Vinogradoff suggests t h a t the binding
e f f e c t o f a promise f o r a promise originates from the l o c a l courts. See also
Plucknetts Concise H i s t o r y p^a • 'There are divers actions which a man may have i n
the C i t y o f London which
he may not have a t Common Law, such as an a c t i o n on a
covenant without a s p e c i a l i t y . '
16
Holmes* The Path o f the Law 10 HLR hSl,
and see the case c i t e d i n support o f the
h i s t o r i c a l t r u t h of h i s statement: Bromage v Penning R o l l Rep 368.
17
Holmes-Pollock Letters 187U-1932 de Molfe Howe ed 2nd edn I s 177-
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19
-1
Q
S c o t t i s h development, by the marriage o f law and equity.
The law o f contract, already concerned w i t h complex matters o f c r e d i t , and insurance,
and above a l l w i t h speed, i s the concern o f equity, dispensed by the Chancellor, by
the
P r i v y Council, and by mixed commissions of laymen, lawyers, and c i v i l i a n s . 'The
equity o f the Tudor period was a k i n d o f popular equity i n the sense t h a t i t r e l i e d
through a r b i t r a l commissions on the p r a c t i c a l a i d and the p r a c t i c a l morality o f selected
18
groups o f responsible laymen.'
And t h i s i s not a matter o f s a t i s f a c t i o n t o common
lawyers. They may w e l l s i t on the P r i v y Council, and confer w i t h Admirally on matters
such as insurance; there are many grounds f o r supposing that they are aware o f the
necessity f o r developing a commercial law, and t h a t the means l a y outside the common
law. l e t common lawyers have p o l i t i c a l reasons f o r opposing the growth o f the c o n c i l i a r
19
courts and f o r r e s t r i c t i n g the operation o f equity.
The i n t e l l e c t u a l j u s t i f i c a t i o n which Coke seeks f o r the law i s i n terms o f reason,
'which i s t o be understood (a?) an a r t i f i c i a l p e r f e c t i o n . . . gotten by long study, and
20
not... every man's n a t u r a l reason.'
For a law t o be reasonable beyond doubt, i t
must have stood the t e s t o f time. The paradigm i s custom, and declarations o f custom
are
t o be found i n j u d i c i a l decisions. The 'enlightened thinkers' o f Coke's day might
21
seek modernity as the Tudors had done, by sweeping away and replacing.
the
This i s what
c o n c i l i a r courts might be seen doing i n the area o f contract. To stay t h i s the common
lawyers opposed a l l advances made w i t h the assistance o f the prerogative by presenting
22
an historiography i n which the common law f i g u r e d as a continuum.
A l l novelty was
r e s i s t e d except i n s o f a r as i t could f i t or be f i t t e d i n t o the gnarled forms of sixteenth
and seventeenth centiiry common law. Ely t h i s means, t h a t law was made 'the overruling
Footnotes?
18
See generally Dawsons The Privy Council & Private Law i n the Tudor & Stuart
19
20
21
22
Periods hQ Mich Law Rev 293 & 627.
See O g i l v i e s The King's Government & the Common Law.
C i t e d Lewis* Coke & His Theory of A r t i f i c i a l Reasoning. 81;LQR 330.
Holdsworths Some Makers o f English Law p i l l e t seq.
See generally Pococks The Ancient C o n s t i t u t i o n and the Feudal Law.
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20
j u r i s d i c t i o n i n t h i s realm?' the law, represented a t times as almost e t e r n a l , a k i n d
of Volksgeist, w i l l e d the King, according to the lawyers; the King had not given the
law. A c o n t r a d i c t i o n of t h i s injrth, even i n d e t a i l ^ might undermine the p o s i t i o n o f
the new men,
whose strategy was to lead, paradoxically, to the doctrine of
Parliamentary
Surpreraacy.
I f contract i s t o achieve r e c o g n i t i o n a t Common Law,
each b r i c k i n the pragmatic
s t r u c t u r e has to be positioned i n accordance w i t h contemporary theory. The 'daring
reformers
ranged under the banner of equity' make a l a s t i n g c o n t r i b u t i o n to contractual
remedies, but henceforward promises must take what advantage there i s from the
'fertile
mother of a c t i o n s . ' I t i s to the l i n e whose contractual elements may f i r s t be discerned
23
i n the Humber Jerryman's Case
t h a t the common lawyers look. And t h i s l i n e , to Slade
and beyond, i s trespassory. One can scarcely f a i l , i n noting the c o l l i s i o n of Common
Pleas and King's Bench i n Slade,. t o note also the c o n t r i b u t i o n of the action of Debt
to the common law of contract, y e t w i t h two reservations? i n Debt 'the quid pro
quo,
as y e t ungeneralised, was the p r i n c i p a l ; the promise, i f recognised a t a l l , was
merely the accessory.'^^ Debt i s a v a i l a b l e on a specialty
r the l a t t e r being i t s e l f
the o b l i g a t i o n and i f i t were l o s t , or not cancelled by the debtor upon repayment then
the wronged party's only recourse was t o the G>hancellor who alone would f i n d and enforce
a promissory o b l i g a t i o n - or on the r e c e i p t by the defendant of a quid pro quo, t o
•which the defendant can merely answer n i l debet, and wage h i s law.
The f i r s t r e s e r v a t i o n i s as to the q u a l i t y of the c o n t r i b u t i o n . Pophamls remark i n
[support of the idea t h a t every debt imports a promise, t h a t 'long use and multitude o f
[ p r e c e d e n t s . d r a w i t i n t o a law'^^ i s dismissed by Baker
as spurious, f o r Popham
c i t e s no precedent.
fche second r e s e r v a t i o n concerns the q u a n t i t y of the c o n t r i b u t i o n , f o r 'the development
of contract i n the 17th century stemmed not from any solemn considered declaration o f
ootnotes?
23
22 Ass 9h (No i i 7 ) c i t e d Plucknett. Concise History
2h
klil.
Salmonds History o f contract XiaRl66 a t pl68. Also P & M Hist I I 212.
P & M H i s t o r y I I 203 e t seq.
126
Barkley v Foster c i t e d -.. .Baker: 'New Light on Slad§^ Case'
1971 C L j J ^ ^
P T 0
p222
21
legal.prijgipiple i n Slade's Case, but from the d o c t r i n a l confusion caused by the f a i l u r e
27
of the judges t o reach a n a t i o n a l settlement'.
I n other words, i f Debt had much t o
contribute t o a t r a n s a c t i o n a l theory o f contract i s questionable: and i f i t d i d have,
the extent t o which i t contributed i s not measurable. The common.lawyers were aware,
simply,V o f where they wanted t o go i n each case, but f a i l e d t o reconcile t h e i r desire
f o r short-term progress w i t h t h e i r dogmatic b e l i e f i n the immutability o f the law.
I t i s not proposed t o f o l l o w the growth o f common law contract f t i r t h e r . That equitable
contract i s promissory i n the 17th century i s suggested; thus Bacon can argue t h a t
d u p l i c i t y o f actions i s not j u s t i f i e d
by analogy w i t h the s i t u a t i o n i n which both
Chancery and common law have j u r i s d i c t i o n t o grant remedies i n contract, f o r , he says,
28
Chanceiy w i l l compeil the performance o f a promise, i t w i l l not enforce a contract.
Common law, unconceptualised, grows from trespass. The dichotoity has modern significance.
Footnotes?
27
Op c i t p236.
28
Op c i t p59.
22
II?1
The next stage i n establishing the hypothesis that equity retained a promissoryapproach towards contract, and i n using t h i s hypothesis t o explain and j u s t i f y a
miscellany o f modern cases hy reference t o a t h e o r e t i c a l framework, must be t o explore
the cases. J u s t i f i c a t i o n i n l s h i s t o r i c a l terms must be subordinate t o explanation, f o r
I cannot subscribe t o t h e view epitomised by K i t t o , _ J i n Wilson v Darling Island
Stevedoring Co t h a t a new p r i n c i p l e may not 'atone f o r i t s heterodoxy by the convience
of i t s r e s u l t s .
I disagree r e s p e c t f u l l y w i t h Professor Wilson's confining o f the equitable estoppelJ
2
p r i n c i p l e t o matters o f waiver and forbearance,-for these seem merely instances o f a
much wider d o c t r i n e ; y e t a very important reason f o r i n s i s t i n g t h a t equity maintained
3
i t s i n t e g r i t y i s t o be found i n the case o f Foakes v Beer. The facts are w e l l known.
Mrs Beer' obtained judgement against Dr Foakes i n the sum o f £2,090. 19 . 0. She then
made a promise i n w r i t i n g ^ n o t t o sue f o r the balance, i n r e t u r n f o r an immediate
payment of £^00, followed by the balance i n instalments. The House of Lords refused
t o uphold the promise, although the strength of the r a t i o may be diminished, since two
members o f the House considered t h a t Mrs Beer had merely promised t o w a i t , and not t o
forgo the i n t e r e s t . I t i s possible t o see her promise as one of i n t e n t i o n , as contrasted
[with a representation as t o e x i s t i n g f a c t , but i t was not necessary f o r the judges t o
speculate upon the nature o f such promises generally i n order t o achieve what they
Footnotes?
|u
95 CKi k3, a t p85. The a n t i t h e s i s of K l t t o , J's view i s expressed i n Cohns
E x i s t e n t i a l i s m & l^gal Science.
Recent Developments i n Estoppel 67 LQR 330; & A Reappraisal o f Quasi-estoppel 196^
CLJ 93. See .also h i s a r t i c l e i n Tulane Law Rev.
(1883U1
221.
f^%Qh] 9App Cas 605.
I t may be relevant t o note t h a t , as T r i e t e l points out (Contract 3 r d ed p99)
Dr Foakes' s o l i c i t o r d r a f t e d the document. I t ought also t o be borne i n mind that
the a c t i o n was brought t o obtain payment of i n t e r e s t , as t o which the promise was
s i l e n t - The House may have been divided had Mrs Beer expressly, undertaken not t o
claim i n t e r e s t .
P T 0
23
sought as between the p a r t i e s ? The a c t i o n of Debt, as we have seen, looked t o the
b e n e f i t t o the promissors Pinnet's Case^ was brought i n Debt (and even then the decision
•7
went the other way
limited
on a t e c h n i c a l i t y ) and the dictum c i t e d i n Foakes v Beer
i s of
relevance.
However, i f we accept the case as i n d i c a t i v e of the common law reaction t o promises,
8
8A
mast we accept Jorden v Money as a summary of the equitable view?
The case i s fraught
FootnoteSt
5
See Lord Denning's judgement i n D & C Builders v Rees 1966
2QB617. Where, again,
to uphold the promise would have been inequitable to the promissor.
6
1603
7
That 'payment of a lesser sum on the day i n s a t i s f a c t i o n of the greater cannot be
5 Co Rep
117a.
any s a t i s f a c t i o n of the whole because...by no p o s s i b i l i t y can a lesser sum be a
s a t i s f a c t i o n t o the p l a i n t i f f f o r a greater' w h i l s t 'The payment and acceptance
of a p a r c e l before the day would be a good s a t i s f a c t i o n . . . ; f o r . . . i t . . .would be more
b e n e f i c i a l to (the p l a i n t i f f ) than the whole a t the day and the value of the
s a t i s f a c t i o n i s not m a t e r i a l ' . As regards quid pro quo t h i s i s a most i n c o n t r o v e r s i a l
d e s c r i p t i o n , but to argue from here to a theory o f consideration seems unnecessary.
To the extent t h a t i t represents Debt's c o n t r i b u t i o n to contract (ante) i t would
be a purely common law statement.
5HL Cas I 8 6 ;
868.
8
1851;
8A
Atiyjah "suggests another reason f o r the decicion i n Consideration i n Contracts -
'
10 Eng Rep
A fundamental restatement, p5ii. 'The p l a i n t i f f . . .did shew a good contract and t h a t
is...wl^y he f a i l e d . . . (T)he Statute of Frauds required t h a t a promise i n consideration
of marriage must be proved i n w r i t i n g . . .but he had no w r i t t e n note or memorandum
signed by the defendant. His counsel.. .deliberately r e f r a i n e d from arguing h i s
case i n contract, but r e l i e d i n estoppel. Had t h i s stratagem succeeded.. . i t would
have meant t h a t any p l a i n t i f f who
could show t h a t he had a l t e r e d . h i s p o s i t i o n i n
r e l i a n c e on the defendant's promise could ignore the Statute and r e l y on estoppel'.
P T 0
2h
w i t h d i f f i c u l t y and ambiguityj though the f a c t s , again, are i n part f a m i l i a r . ¥illiam
Jfoney, a Naval Ensign of l i t t l e percipience was persuaded by two o f h i s colleagues t o
purchase some Spanish bonds, the honouring o f which by the Spanish Government h i s father
was then n e g o t i a t i n g . He borrowed £1,200 from one Charles Mamell i n order t o e f f e c t
the purchase, b u t , f o l l o w i n g the f a i l u r e o f h i s father's negotiations, the bonds proved
worthless and the money was l o s t . Because two others were implicated i n the speculation,
his f a t h e r o f f e r e d £[|.00 t o Charles Marnell i n s a t i s f a c t i o n o f the debt, a sum which the
l a t t e r i n t i m a t e d he would accept. On h i s death Charles's s i s t e r Louisa i n h e r i t e d the
claim, and her s o l i c i t o r s , despite her insistence t h a t she would never enforce the
claim, wrote t o Money's f a t h e r about the o f f e r of £l;00. His answer was that the
circumstances were now changed, andhe refuse_d:payment.. There was evidence o f a close
f r i e n d s h i p between W i l l i a m Money and Louisa Mamell. Being assured t h a t she would not
enforce the claim, he married. A t 'an advanced age she married, taking as her marriage
0
portion'
the debt. Jorden, her husband, j o i n i n g h i s w i f e , sued. The case went on appeal
from Chancery t o the Court o f Appeal i n Chancery, thence t o the House of Lords.
I t i s worth quoting the headnote, since the current view subscribed t o by the courts
seems t o owe much t o i t .
'Where a person possesses a l e g a l r i g h t a court o f equity w i l l
-
not i n t e r f e r e t o r e s t r a i n him from enforcing i t although between the time o f i t s
'creation and t h a t o f h i s attempt t o enforce i t he has made representation o f h i s
i n t e n t i o n t o abandon i t . ' Jackson criticises"'"'^ Lord Cranworth, L C's i n t e r p r e t a t i o n o f
the cases which he cites? i n Montefiore v Montefiore"*""^ Lord Mansfield refused t o allow
} man t o reclaim a sham note o f hand which he had given t o h i s brother f o r the purpose
Df inducing consent t o the brother's marriage by the bride's father. (No man s h a l l set
12
l i s own i n i q u i t y up as a defence.' I n N e v i l l e v Wilkinson
a c r e d i t o r anxious t o
recover h i s money drew up a . much reduced schedule of the defendant's debts: the father
3f the heiress whom the defendant sought t o marry s e t t l e d these, and consented t o the
inarriage. The c r e d i t o r sued the defendant f o r the balance a f t e r the marriage, when the
'. Pootnotes?
Lord St Leonards, a t p2ii9.
0
l l
1.2
Jackson? Estoppel as a Sword 81 LQR 8k.
1WBL 363.
1 Bro c c 5U3. .
,
p rp Q
25
defendant was i n possession o f h i s wife's fortune. Not s u r p r i s i n g l y the court held the
c r e d i t o r to h i s o r i g i n a l representation o f f a c t . Gregg v Wells'*"^ i s a s i m i l a r case,
the decisions being that a p a r t y who has 'negligently'or 'culpably' stood by w h i l s t
another makes a contract on bases which the f i r s t knows t o be f a l s e , may not subsequently
assert the falseness of those bases.
Gale V Lindo^^ c i t e d by Lord Brougham, was another case o f supplementing a s i b l i n g ' s
fortune t o enhance m a r r i a g a b i l i t y . Both p a r t i e s being dead, the question between t h e i r
executors was; could the brother who had l e n t h i s s i s t e r money i n r e t u r n f o r a bond
whose existence was xinknown t o the f u t u r e husband, and who had therefore made a
representation of f a c t t o the f u t u r e husband, have enforced payment, i n contradiction
of the representation. Lord J e f f r e y s , L C held t h a t t h a t which was once a fraud must
always be a fraud.
Contrasting w i t h these cases of r a t h e r oblique relevance are those r e f e r r e d t o by Lord
St Leonards i n h i s dissenting judgement. I n Cookes v Mascall"*"^ a father promises to
s e t t l e property on h i s daughter's future husband, and the l a t t e r ' s father i s also t o
make a settlement on the s u i t o r . Disagreement occurs. Subsequently the son i s allowed
to v i s i t the g i r l w i t h her f a t h e r ' s approval, and the two were married, he 'being p r i v y
to i t . He seemed w e l l pleased.' The son's f a t h e r o f f e r s t o make the settlement on h i s
son, and the f a t h e r of the daughter was held i n Chancery bound t o perform. Another
marriage case, Moore v Hart"*"^ concerned representations made by the defendant father
to f r i e n d s o f the p l a i n t i f f t h a t , were the l a t t e r t o marry h i s daughter the defendant
would give £U,000 along w i t h her. P l a i n t i f f became a s u i t o r , w i t h the defendant's
approval, but the defendant's promise l o s t , w h i l s t h i s daughter's a f f e c t i o n f o r the
p l a i n t i f f gained, strength. A l e t t e r was produced, w r i t t e n by the defendant t o p l a i n t i f f ' s
f r i e n d , and t h i s was s u f f i c i e n t t o enforce the promise t o s e t t l e land on h i s daughter,
once the marriage i n reliance upon the representation of i n t e n t i o n had taken place,
[ootnotess
13
10 Ad & iSl
90.
1 Vern U75, 23 Eng Rep
601.
:l5
23 Eng Rep 730; 2 Vern 200.
:.6
2 Verii 3 6 I .
23 Eng Rep
352.
P T 0
26
Lords Cranworth and Brougham were e n t i t l e d t o reach, on t h e i r cases, the conclusion
t h a t a fraudulent representation of f a c t may not i n equity be r e t r a c t e d when convenient,
or indeed (Gale v Lindo"^), ever, but scarcely the p o s i t i o n t h a t representations o f
17
i n t e n t i o n were unenforceable i n equity. That the contrary was true may be seen from
Lord St Leonard's cases, and also from a b r i e f examination of a number of others. Thus
18
Hobbs V Norton
? an intending purchaser o f an annuity charged upon (and from)the younger,
asked the e l d e r , brother a number o f questions about t i t l e . The elder brother answered
t h a t he believed t h a t a settlement antedating the w i l l would have the e f f e c t o f avoiding
the annuity, but t h a t the purchaser need not worry, f o r he, the elder brother,had
always paid the annuity t o the younger on time. Encouraged, the purchaser bought the
annuity. The Chancellor refused t o allow the elder brother t o take advantage o f the
settlement i n question, to which he l a t e r succeeded, i n order t o avoid paying the
aimuity, holding him t o h i s statement, from which there could be i n f e r r e d a representation
o f i n t e n t i o n to continue the annuity payments binding, a t any rate i n equity. Twelve
years l a t e r 19 i n Waiikford v Fotherley 19 a f a t h e r o f f e r e d , t o p l a i n t i f f ' s knowledge, t o
s e t t l e £3,000 on h i s daughter on the occasion o f her marriage. The father seemed t o
approve o f her subsequent marriage t o p l a i n t i f f , and the Chancellor ordered him to pay
19A
the amount t o the p l a i n t i f f as administrator, f o l l o w i n g the daughter's death.
Doubtless Waiikford v Fotherley might be viewed as a form of u n i l a t e r a l contract, a
20
precursor of C a r l i l l ' s
case,
though an i n t e n t i o n to be l e g a l l y bound by a contract
flhich i t was necessary to discover i n t h a t case i s perhaps absent. I t i s more u s e f u l l y
seen i n the context o f the preceding Chancery cases, the r a t i o n a l e being analogous t o
Footnotes?
17
See Jackson 8 I LQR 81;.
L8
1 Vern .I36; 21 Eng Rep (1099).
19
(I69k) 2 Vem 322; 23 Eng Rep 807.
i:9A
See also Hodgson v Hatcheson (I7II) 5 Vln^ AhT$22 p i 3h another marriage agreement
^0
enforceable outside the r u l e s o f common law contract.
C a r i i l l v Carbolic Smoke B a l l Co(1893)1 QB 2^6.
P T0
27
21
t h a t which j u s t i f i e s the separation o f the Hedley ^ne"^"^ cases from contract. I t
becomes important t o maintain the d i s t i n c t i o n i n view of the i n t e r p r e t a t i o n placed on
Luders v Anstey
22
23
by Stephen, J i n Alderson v Maddison. The relevant f a c t s o f Luders
V Anstey were t h a t Robert Anstey made a proposal of marriage to I j i c r e t i a Light. She
h e s i t a t e d f o r f e a r o f the f i n a n c i a l consequences t o her children hy a former marriage.
Anstey wrote t o her proposing t o s e t t l e two-thirds o f her fortune on them, and one-third
on a i ^ c h i l d r e n o f Lucretia and himself. His regiment was embarking f o r I n d i a , so he
hastened a f t e r h i s l e t t e r , met her i n Bath, where tiiey were married. ' I do not see,'
the Lord Chancellor said, 'how i t i s possible t o avoid making the l e t t e r the basis o f
the settlement; Mr Anstey having i n s t a n t l y followed the l e t t e r and marriage having
taken place immediately. Upon h i s p a r t the l e t t e r contains a s p e c i f i c and completie
arrangement o f t h e i r money a f f a i r s and upon t h i s the marriage took place. The only
conclusion I can now draw i s , t h a t t h i s s a t i s f i e d her objections and she married.'^^
No suggestion i s made t h a t there might be a contract i n the common law sense, y e t
23
Stephen, J, f o l l o w i n g the hearing o f Alderson v Maddison a t Durham Summer Assizes
i s able t o say t h a t ' i n Luders v Anstey i t was held t h a t a l e t t e r making a suggestion
as t o a settlement followed by a marriage... such as t o imply.. .acceptance.. .may be a
contract f o r a settlement.' I t i s i n t h i s way t h a t the h i s t o r y o f the promise comes
t o be r e w r i t t e n t o f i t the p a t t e r n o f common law contract.
Footnotes*
21
Hedley Byrne v Heller & Partners(l961i)AC i;65.
Anderson v Rhodes (1967)2 A l l E R 650 c f w i t h De l a Bere v Pearson a908 )1KB280 a
' r e s u l t - o r i e n t e d decision' which imposed a s t r a i n on the r u l e s o f contract. A
separate basis o f l i a b i l i t y i s less tortuous, but see T r e i t e l 3rd ed pli9 n 67.
22
(1799) L^Ves 501. Also on another point 5 Ves 213; & 1 Ves Supp kS^.
23
(1880) 5ex 293.
2h
U Ves 501 a t p5l2.
25
1880 5 ex D 293 a t p29U. For other cases r e l i e d upon ( J j submit misguidedly) v i z
Hammersley v De Melk, & Prole v Soady,
see l a t e r .
P T 0
28
I n Evans v B i c k n e l l
27
the defendant had the fee simple i n some properly, i n t r u s t f o r
his s i s t e r . He allowed S t a n s e l l possession of the deeds, enabling him to act as owner,
and to enter i n t o a mortgage w i t h p l a i n t i f f ' s w i f e . On the f a c t s the case i s peripheral
to our discussion, but there are one or two points of i n t e r e s t . The question put by
the Chancellor t o Romdily ( f o r p l a i n t i f f s ) concerning equity's j u r i s d i c t i o n
answered by r e f e r r i n g to (the l i m i t s of common law j u r i s d i c t i o n over
was
representations?
'In t h i s case there i s no p r i v i l y between B i c k n e l l and the p l a i n t i f f ? no assumpsit or
28
contract.'
^
contrast ' i t i s a very o l d head of equity, t h a t i f a representation i s
made to another person, going t o deal i n a matter of i n t e r e s t upon the f a i t h of t h a t
representation, the former s h a l l make t h a t representation good i f he knows i t t o be
29
30
false'
The contrast between t h i s decision and the disaster of DenyyPeek
indicates
and also explains the d i f f e r i n g approaches of the two systems: ' i f (the defendant)
p o s i t i v e l y J, p l a i n l y and p r e c i s e l y de'riies the assertion, and one witness only proves i t
p o s i t i v e l y , c l e a r l y and p r e c i s e l y , as i t i s denied, and there i s no circumstance
attaching c r e d i t t o the assertion overbalancing c r e d i t due t o the denial as a p o s i t i v e
32
i e n i a l , a court of equity w i l l not act upon the testimony of t h a t witness.
Law.
Not so a t
There the defendant i s not heard. One witness proves the case; and however strongly
•|;he defendant i s i n c l i n e d t o deny i t upon oath there must be a recovery against him. '^"'"
ord Eldon admonishes Lord Mansfield f o r h i s p a r t i n not attending to t h i s difference
iLetween law and equity -
doubt j u s t i f i a b l y i n I 8 O I . However, an e a r l i e r fusion of
p r i n c i p l e and procedure might have avoided l a t e r
]i"ootnotes:
j:7
(1801) 6 Ves
confusion.
l7U.
18
Op c i t PI76.
^9
Op c i t pl82 per Lord Sldon, L C.
30
1889
11; App Case 337
1
31
; (1801) 6 Ves 171; a t pl8U.
I
32
See A m o t V.Briscoe (I7U3) 1 Ves 96, l e Neve v Le Neve (17U7) IVes 65. The
action
w i l l not be sustained by reason of the evidence of one witness i f the denial relates
to the same f a c t , and i f the d e n i a l i s 'precise and p o s i t i v e . '
P T 0
29
I have i n d i c a t e d t h a t the f a c t s of Jorden's Case^^ do not j u s t i i y what i s generally
taken t o be i t s r a t i o . The remarks concerning the e n f o r c e a b i l i t y of representations of
i n t e n t i o n i n equity are mere o b i t e r ; not only so, but three f i n a l cases should s u f f i c e
t o shew t h a t those o b i t e r d i c t a are mistaken. Whilst the e a r l i e r cases ( c i t e d above)
are open t o a t t a c k grounded on t h e i r age, Hammersley v De B i e l ^ ^ a House of Lords
decision, precedes Jorden l y only nine years. Baron De B i e l being minded t o marry
Sophia P o u l l e t t Thompson, her father promised t o give £ 2 0 , 0 0 0 t o each of h i s two
daughters. De B i e l was required t o s e t t l e £500 a year - 'a sum almost beyond iiy means' on Sophia, f o l l o w i n g which he married her. A settlement of £ 1 0 , 0 0 0 was completed, and
when de B i e l n o t i c e d that no mention was made of the other £ 1 0 , 0 0 0 , which Thompson had
previously promised t o leave i n h i s w i l l , he was t o l d t h a t i n c l u s i o n of i t i n the
indenture would be 'not proper i n p o i n t of form.' Lord lyndhurst, L C enforced the
promise. Inducements, held are by a person ' p l a i n l y and d e l i b e r a t e l y ' and having the
desired e f f e c t of the promissee's celebrating a marriage because of them, are
isnforceable i n equity a t the s u i t of the promissee. '...A court of equity w i l l take care
•;hat he i s not disappointed.' There seems l i t t l e doubt t h a t Hammersley v De B i e l could
35
Ijiave been decided on contractual p r i n c i p l e s , w i t h the same r e s u l t , i n a court of law.^
footnotess
3|3
Ante p23.
yfi
(I8i;5) X I I CI & Fin i;5 8 Eng Rep
1312.
See S t u a r t , V C i n Loffus v Moore ( I 8 6 2 ) 3 G i f f 592; 66 Eng Rep ^kh Jorden v
Money (ante) cannot be considered as a reversal of Hammersley v De B i e l ; and the
p r o p o s i t i o n a t t r i b u t e d t o Lord Cranworth i n the p r i n t e d report, t h a t a statement
or representation o f what a person intends or does not intend i s not s u f f i c i e n t
seems irtrelsoncileable w i t h the decision of the House of Lords i n Hammersley...,
and w i t h the law as l a i d down by a l l the judges o f highest a u t h o r i t y . I t i s
remarkable t h a t the case...was not r e f e r r e d t o by any of the counsel...in...Jorden
35
V Money.'
See Wilsons Recent Developments i n Estoppel 67 LQR 330 a t p 331.
P T 0
30
Lord St Leonards thought so i n Maunsell v Hedges^^ a case on appeal from the Court of
Chancery i n I r e l a n d . ' I do not dispute the general p r i n c i p l e that what i s c a l l e d a
representation.which i s made f o r another person t o act upon and i s followed by h i s
a c t i n g upon i t , w i l l , e s p e c i a l l y i n such a case as marriage, be deemed t o be a contract. '^"^
However, Hammersley was not decided according to the narrow common law theory of contract,
but
according t o a wider, equitable p r i n c i p l e . And on i t s f a c t s , Maunsell v Hedges no
move runs counter t o t h i s equitable p r i n c i p l e than D & C Builders v Rees
can be said
39
to r e f u t e t h e modem statement o f the p r i n c i p l e i n High Trees.
The appellant, Maunsell, wished t o marry a g i r l whose guardians refused t h e i r consent,
she being not q u i t e seventeen, and he being unable t o make adequate f i n a n c i a l provision
f o r her. The respondents were the administrators of the estate of Maunsell's uncle,
Robert Hedges. Hedges' representation t h a t Maunsell would receive large estates i n
Tipperary under a w i l l which a t t h a t time Hedges was 'convinced...1 s h a l l never a l t e r . . .
to your disadvantage' persuaded the guardians t o observe t h a t the g i r l ' s 'affections
are
s t r o n g l y engaged, and t o agree t o the marriage. They were aware t h a t Hedges had
•declined making any immediate settlement' upon the appellant.
The Uncle's f i n a n c i a l adviser died i n 1819^
and i n h i s stead the appellant on two
occasions gave some rather dubious advice, i n v o l v i n g Hedges i n two lawsuits and loss
of money. Rather u n s u r p r i s i n g l y perhaps. Hedges was moved to question the wisdom of
conferring upon h i s nephew the b e n e f i t of the Tipperary estates. He made a new
will,
excluding him, and afterward died.
Three observations need be made? f i r s t i t was the guardians t o whom any inducement was
h e l d out^^''^ and thus the guardians who must f i l e the b i l l . Second, i t i s doubtful i f
Footnotes?
36
(iQSk)
37
Op c i t a t P1059.
38
(1966) 2 QB
t
10 Eng Rep 769;
18^1; HLC
1039.
617.
9
Central London Property Co v High Trees House L t d ( l 9 i ; 7 ) KB
130.
9A
i e Inducement t o consent? i t would not be r e a l i s t i c t o hold t h a t the nephew was
induced t o marry the g i r l , as he contended. This no doubt contributed t o h i s f a i l u r e .
Through quaere wether the guardians might be trustees of a r i g h t t o sue on the
p r i n c i p l e o f Tomlinson v G i l l (ante).
PTO
31
the inducement could be held t o be a representation, f o r , had Hedges wished he could
have made an immediate settlement upon the appellant, and the significance o f h i s n o t
doing so ought t o have struck the guardians^*^ they must be takentto have known t h a t
the w i l l was revocable u n t i l death, f o r they knew t h a t the appellant was not induced
t o seek the g i r l ' s hand by the uncle's promise. T h i r d , having cost the uncle large sums
i n such a way the appellant may w e l l not be i n a p o s i t i o n t o request a court of equity
t o exercise i t s d i s c r e t i o n i n h i s favor. His appeal t o Hedges' good f a i t h i s less strong.
These observations are relevant t o a discussion o f the second o f the three cases more
or l e s s conteii5)oraneous w i t h Jorden, and which operate t o cut down i t s supposed r a t i o s
Piggot V S t r a t t o n ^ Here there were two p l o t s o f b u i l d i n g land on the I s l e of Wight
held under a lease containing covenants r e s t r i c t i n g b u i l d i n g density. Observation o f
these covenants was undertaken by both p a r t i e s t o the sublease o f one p l o t , and t h i s
meant t h a t from the bungalows b u i l t on t h a t p l o t there was a view o f the Solent. I n
consequence consideration f o r the sublease was high. The sublessor then surrendered
the headlease and took a f r e s h one from the lessor containing no r e s t r i c t i o n on
b u i l d i n g density. P l a i n t i f f - assignee o f the sublease sought an i n j u n c t i o n t o r e s t r a i n
the sublessor from b u i l d i n g on the property retained i n such a way as t o deprive h i s
bungalows o f t h e i r sea view and render them unmarketable.
( I l e a r l y p l a i n t i f f had no easement over the sublessor's plot!:^^ Equally c l e a r l y . Lord
C air?»bell, L C f e l t , i t would not be 'consistent w i t h equity and good conscience t h a t
i l t r a i t t o n , t o make an increased p r o f i t on the land which he had not sublet, should be
£,llowed t o b u i l d houses on i t . . . ' i n a maimer contrary t o the agreement between the
f a r t i e s t o the sublease. There was no w r i t t e n covenant which p l a i n t i f f could r e l y upon,
1- owever b u t ' I apprehend the i n j u n c t i o n t o be supported on the well-established doctrine
t h a t i f A d e l i b e r a t e l y makes an assertion t o B intending i t t o be acted upon. ..and i t
5!o.o±notess
•
MO: .:Jdawn.§ell's-earlier-financial Iscrape' -was mentioned, i n the l e t t e r i n which the
uncle said t h a t the nephew was a beneficiary"under h i s w i l l .
iJl
1859 1 De GF & J 33 (see p5l f o r an i n t e r p r e t a t i o n o f Jorden v Ifoney (ante))
Up
For an a t t e n p t t o confer greater r e s p e c t a b i l i t y by f i n d i n g an i n t e r e s t i n land see
l a t e r s i n t e r a l i a Bird'ons v Evans.
P T 0
32
1 Q
i s . . . A i s estopped from denying i t s t r u t h . '
But, i t was argued, A was not here
denying i t s t r u t h . He had made a true representation o f the covenants i n the headlease,
a t the time o f the sublease. The s i t u a t i o n had since a l t e r e d . Insofar as he had made a
representation of i n t e n t i o n t o observe the terms of the headlease a f t e r leasing t o be
bound by them, t h i s was unenforceable? Jorden v Money. 'But moralists and j u r i s t s t e l l
us t h a t words are t o be understood i n courts o f j u s t i c e i n the sense i n which the persons
who used them wished them t o be understood by the person t o whom they were addressed. ' ^
Although S t r a t t o n merely asserted t h a t he had no power t o b u i l d so as t o block the sea
view ' i t would be c h i l d i s h t o suppose t h a t he meant t o be understood t o say although
he had no power then t o do the a c t , he might afterwards acquire the power by surrendering
the lease.' I n other words, Stratton's representation was worthless except insofar as
i t was a representation o f i n t e n t i o n . W h i l s t Louisa Jorden promised t h a t she had no
present wish t o enforce the bond, her conduct i n r e t a i n i n g the bond suggested possible
ijfuture i n t e n t i o n s o f a d i f f e r e n t nature, which she could not be said t o be concealing
iaehind an unimpeachable statement o f f a c t . S t r a t t o n , on the other hand, made a statement
of f a c t which derived i t s whole substance from i t s implications about h i s future conduct.
This discussion points t o the c a s u i s t i c nature o f any d i s t i n c t i o n i n p r i n c i p l e between
1
statements o f f a c t and statements o f i n t e n t i o n . Such /a d i s t i n c t i o n i s bound t o work
c a p r i c i o u s l y and could favour scoundrels l i k e Stratton. Common law pragmatism ought,
and i -argue i s , tendered by an equitable concern w i t h substantial issues? any other
view must be retrograde t o the achievement o f j u s t i c e . And i t seems pointless t o lose
j u s t i c e i n the p a r t i c u l a r case merely because one cannot define j u s t i c e a t large.
The t h i r d case i s Prole v Soady!^'^ There was a representation which induced p l a i n t i f f s ' *
f a t h e r t o marry t h e i r mother, made by t h e i r maternal grandfather,to the e f f e c t t h a t c e r t a i n
property would become t h e i r s ( u l t i m a t e l y ) . I t was made before the marriage and on several
Footnotes:
1
;3 1859 1 De GF &J 33 a t pl;9 See Nunn v Fabian 11 Jur N S 868 and, generally. Storey
on Equity Jurisprudence (1866) p75l e t seq.
kh
k[>
Op c i t a t p50.
M860) 2 G i f f 1. 66 iSng Rep 1.
PTO
33
subsequent occasions. They sued h i s administrators as h e i r s o f t h e i r dead mother, and
were successful on the basis o f Hammersley v De B i e l . As w i t h that case and Piggott v
S t r a t t o n , a decision might have rested on the p r i n c i p l e s o f contra'ctl'''^ I t i s necessary
to emphasise however, t h a t these were not cases i n common law contract .Lord Cottenham
expressed the matter q u i t e c l e a r l y : 'A representation made by one p a r l ^ f o r the purpose
of i n f l u e n c i n g the conduct o f the other party, and acted on by him, w i l l i n general be
s u f f i c i e n t t o e n t i t l e him to the assistance o f t h i s court f o r the purpose o f r e a l i s i n g
isuch r e p r e s e n t a t i o n T h i s expression might, taken i n i t s context, and i n view of the
predominant f a c t - s i t u a t i o n o f the a u t h o r i t i e s , be confined to promises inducing
marriage!^"^^ However, the a u t h o r i t i e s are wider than this!;^^ Moreover, and perhaps
s i g n i f i c a n t l y , the l a t e r cases f o l l o w i n g Jorden v Money and e f f e c t i v e l y submerging the
equitable beneath the common law approach t o promises have not sought so t o confine
the equitable d o c t r i n e , but have instead chosen to ignore i t completely.
Before considering developments subsequent to the procedural fusion of 1873, i t i s
I
necessaiy t o assess another f e t t e r placed upon the enforcement of promises t y l e g a l
1x9
means. I n Combe v Gombe, Denning L J reversing Etyme, J a t f i r s t instance,'insisted
Footnotes;
kl
c f Caton V Caton ( l 8 6 l ) LR I Ch 137: Lord Cranworth, L C reversing Stuart, V-C.
The case i s decided on contractual grounds, and p l a i n t i f f loses by operation o f
;
the S t a t u t e o f Frauds s.k'
kS
12 C I & Finn k$ a t p62 Note.
i|7A
See also Ungley v Ungley 5 Ch D887
& Dean Pound's comment i n 'Consideration i n Equity' 13 I l l i n o i s L Rev k3S a t piUiO
n 17 ' . . . i t i s s t r e t c h i n g the f a c t s t o say t h a t the daughter made a... contract
w i t h her f a t h e r t o marry the man t o whom she was already engaged.'
i|8
Representations inducing consent t o marriage are generally representations of f a c t .
For non-marriage s i t u a t i o n s see the cases c i t e d e a r l i e r : Hobbs v Norton; Piggott
V Stratton. .
I
lib
19^1 2 KB 215.
P T 0
31;
w i t h proper p a r e n t a l concern'^"^ t h a t the High Trees p r i n c i p l e 'does not create new
causes o f a c t i o n where none existed before,• warning t h a t ' i t i s important t h a t (the
principle.) should not be stretched too f a r l e s t i t be endangered.
This l i m i t a t i o n
i s , he says, ' i m p l i c i t i n a l l the modem cases i n which the p r i n c i p l e has been developed.'
To what extent i s i t supported l?y the e a r l i e r authorities?
1112 •
I have perhaps said s u f f i c i e n t t o e s t a b l i s h a possible difference between equitable and
common law approaches t o promises. How f a r t h i s enables us t o d i f f e r from the reader
of Spencer-Bower and Turner
who ' w i l l be able t o cock a snook a t people who t a l k
about equitable estoppel^ '^^ and from the author who would apply t o a l l forms o f
estoppel by representation 'the language o f naval warfare ( t h a t ) estoppel must always
e i t h e r be a mine-layer or a mine-sweeper: i t can never be a c a p i t a l u n i t , '^^ we must
now examine. I t i s necessary t o look b r i e f l y a t the e a r l i e r a u t h o r i t i e s before examining
the connexion between estoppel and the enforcement of promises a f t e r 1873.
jTurner
c i t e s Lord Esher, M R i n Seton Laing v Lafone
: 'an estoppel does not i n
I t s e l f give a cause of action; i t prevents another person from denying a state o f f a c t s . '
!
^8
^7
6 f Vaughan L J's dictum i n Williams v Pinckney
he i s dismissive. Vaughan L J said
'the common law doctrine o f estoppel i s o f a very personal nature and only e x i s t s between
p a r t i e s t o a transaction. I t i s p a r t o f the law of evidence and not the same as the
equitable d o c t r i n e . You cannot found an a c t i o n on i t as you can i n equity.' Instead,
Footnotes:
^',0
See Stone: Social Dimensions o f Law & Justice p26l note 259: see, f o r the suggestion
t h a t the case r e f l e c t e d 'the moral values o f our society»Atiyali: Consideration p5l.
51
' 1951 2KB 215 a t p219.
5 2 ^ Spencer-Bower & Turner: Estoppel by Representation 1966.
53
Harvey: Book leview o f Estoppel by Representation 30 MLR3U8.
^li
Spencer-Bower & Turner p7.
55
Op c i t note 2.
56
(1887) 19 QBQ 58.
57
(3:897) 67 LJ Ch 30 a t p37.
58
Spencer-Bower & Turner pl2.
P T 0
35
Turner says t h a t estoppel';occurs as a cause of action only i n cases of acquiescence:
i n other cases the cause of a c t i o n i s i n r e a l i t y elsewhere, and estoppel i s used as a
'mine-sweeper' t o demolish a defence. Other cases are u s e f u l l y categorised as wrongly
decided.
jThere are a number o f points to make here. As Turner admits throughout h i s book, many
o f the cases which can be categorised as cases of estoppel by representation contain
do
no reference t o the doctrine?
Denning, J, i n Klgh Trees states t h a t 'these are not
cases o f estoppel i n the s t r i c t sense. They are promises - promises intended t o be
(binding, intended t o be acted upon, and i n f a c t acted upon...the proper inference was
t h a t the promissor d i d intend t o be bound.
Wrapped up i n a technical doctrine such
|as t h a t o f common law estoppel, the l i m i t a t i o n asserted t o l^y Turner, and p o l i t i c a l l y
laccepted by Denning, L J i n Combe v Combe^"*" might appear respectable. However, i f the
i o c t r i n e o f equitable estoppel i s a p t l y envisaged i n High Trees, and as I should consider
jnost u s e f u l , as merely an example o f a method of enforcing promises where the f a c t s
J u s t i f y t h i s as being f a i r and equitable, then Turner's l i m i t a t i o n appears suspiciously
I
1
l i k e an example of homeostasis. A r b i t r a r y f e t t e r s excused by a pretense that rules o f
J
'vidence are not i n r e a l i t y determinants of substantive r i g h t s ^ ^ are bad enough, but
5j9
Not merely the e a r l i e r cases r e f e r r e d t o i n t h i s section, biit those r e l i e d upon by
ootnotesj
Denning, J i n Central London Prop Co v High Trees House Ltd(19li7)KB 130, namely:
Hughes V Metropolitan Railway Go(l877)2 App Cas li39
Birmingham & D i s t r i c t Land Go v LNWR(l888)liO Ch D 268
. Fenner v Blake (1900) IQB h26
• I n Re Wickham (1917) 3hTUL l58
Re W i l l i a m Parfcsg(l937) 2 A l l E R 36I
B u t t e i y V Pickard(l9U6)WN 25
6jD
High Trees a t pl3U.
5|L
c f the s i t u a t i o n i n c r i m i n a l law where the r u l e s governing the a d m i s s i b i l i t y o f
confessions may be seen as guarantees o f c e r t a i n freedoms.
P T 0
36
r u l e s o f equity dependent f o r t h e i r e f f i c a c y upon f o r t u i t i e s are worse, i n an advanced
l e g a l system. Thus where A makes a promise t o B and B plans h i s future around the
promise, he cannot sue on i t j ^ though i f A sues i n contradiction of the promise, B may
set up the promise as a defence and estop A from denying i t . However, i f A knows t h a t
B i s i n f r i n g i n g a r i g h t t h a t i has but does nothing t o inform him of h i s , and B i s ,
reasonably, ignorant t h a t he i s doing so, then B may sue A and estop A from asserting
the r i g h t i n whose infringement he acquiesced^^^
I t may be wondered whether we
cannot f i n d a less capricious underlying p r i n c i p l e .
Moreover, even^if one were t o r e j e c t the u t i l i t a r i a n approach, those who assert on
the a u t h o r i t i e s t h a t estoppel' cannot found a cause of a c t i o n are vulnerable f o r 'the
l o g i c a l s i t u a t i o n i s extremely simple. No number of observations of white swans can
e s t a b l i s h the theoiy t h a t a l l swans are w h i t e : the f i r s t observation of a black swan
can r e f u t e i t . ' ^ ^ I f we accept Lord Cairns' ' f i r s t p r i n c i p l e ' i n i t s h i s t o r i c a l context,
V
i t has founded a cause of actions i n a number of cases,
which cannot be c l a s s i f i e d as
cases o f acquiescence: nor does the cause of action l i e elsewhere, leaving the action
18
upon the promise a mere supportive, or 'mine-sweeper,' r o l e . Hobbs v Norton, Cookes
6.2,.-. I Combe-; v •6ombe( 195l) 2 KB- 2
l
5
.
. ' - i
FootSo^-feeir::-' '
.
'
163
Provided there i s the ingredient of 'detrimental reliance'. High Trees cases see
l a t e r . However t h i s seems t o be a wholly unnecessary import of the rules of common
law contract' t o which, we argue, equiiy i s not subject. See Jackson: Estoppel as
a Sword 81 LQR81;.
Sk
Ramsden v Byson(l866)LRI IS. 129.
S5
See Nokes: I n t r o d u c t i o n t o the Law of Evidence I967 a t p2l5 12l6.
36
Popper: The Listener 1971 p9
^7
See Sheridan: jgquitable Estoppel Today 15 MLR 325 f o r a more complete l i s t of
cases.
P T 0
37
V Mascall, Wankford v Fotherley^^ Borrowes v Iiock^^ Piggott v Strattonjp- Prole v
Soady^^ and Hammersley v De Biel*^^ are a l l such cases^^ I t scarcely seems necessary t o
d i s t i n g u i s h these cases from the p a r a l l e l development i n wliich i t i s admitted, a
70
representation does give a cause o f a c t i o n ,
v i z the cases i n which the p l a i n t i f f i s
t o the defendant's knowledge l e d t y the defendant t o expend money on the defendant's
land i n a n t i c i p a t i o n t h a t he has, or w i l l receive, some i n t e r e s t t h e r e i n . The n o t i o n
o f ' p r o p r i e t o r y estoppel,';!; suggest, i s , along w i t h equitable estoppel, a manifestation
o f equity's regard f o r f a i r n e s s i n the enforcement of promises. When the two concepts
are seen as a p a r t of the same whole, not only can a t r u e r p i c t u r e of the h i s t o r i c a l
development be gained, but we s h a l l see l a t e r t h a t greater u n i t y may be conferred upon
a number of apparently disparate l a t e r cases.
Footnotes;
68
(1805) 10 Ves ii70. Here one Cartwright o f f e r s t o assign h i s share i n the residue
o f a t e s t a t o r ' s estate i n s a t i s f a c t i o n o f a trade debt. The c r e d i t o r - p l a i n t i f f enquires o f the defendant, who v e r i f i e s , t h a t Cartwright's share i s as the l a t t e r
represents. The defendant had f o r g o t t e n (fraud was not alleged) t h a t Cartwright
had assigned a p a r t of h i s share already, 10 years previously. Damages were
awarded t o the p l a i n t i f f .
•What can a p l a i n t i f f , do t o make out a case of t h i s
k i n d but shew f i r s t t h a t the f a c t represented i s f a l s e and secondly, t h a t the
person making the representation had knowledge of a f a c t which was contrary t o
i t . The p l a i n t i f f cannot dive i n t o the secret reserves of h i s heart.' Clearly t h i s
would today be classed w i t h the negligence mis-statement cases. But these are
hedged about w i t h r e s t r i c t i o n s : see
Mutual L i f e Assurance v E v a t t ( l 9 7 l ) 1 A l l E R
150. Immediately before Hedley ^ r n e , the continued development of the High Trees
doctrine seemed to promise an escape from G-andler v Crane Christmas, see Sheridan:
Estoppel Today 15 MLR 32569
Turner dismisses Hammersley as a case i n contract. But h i s a u t h o r i t y f o r doing so
i s probably the i n t e r p r e t a t i o n placed upon the case by Lord St Leonards i n
Maunsell v Hedges (Ante).
70
See Snell's Equity 26th Ed p627-633 ( D i s t i n c t i o n between p r o p r i e t o r y and equitable
estoppel" on p629).
P T 0
38
I n P i l l i n g v Armitage
71
S i r W i l l i a m Grant, M R, said ' i f a landlord enters i n t o an
arrangement w i t h a tenant r e l a t i v e t o improvements, and so completely sanctions them
as himself t o agree t o advance a p a r t o f the money. . . I doubt whether t h i s does not
fasten an e q u i t y upon the l a n d l o r d precluding him from saying.. .that there i s an end
72
to the lease.' S i m i l a r l y i n Gregory v M g h e l l
a p a r o l agreement f o r a twenty-one year
lease was ordered t o be s p e c i f i c a l l y performed a t the instance o f the tenant a f t e r he
had entered and expended money i n a n t i c i p a t i o n . F a i l u r e t o f i x a r e n t was no bar t o
73
the e q u i t y , nor was i t necessary t o invoke the doctrine o f p a r t performance
where a
f a t h e r allowed h i s sons t o occupy and t o spend money on land o f which he was the
equitable owner, i t was held t h a t he could not assert t i t l e against the sons' trustee
i n bankruptcy: Unity Joint-Stock Banking Association v King.
Approbation by a father
of expenditure 'by h i s son on a piece o f land gave the son a r i g h t o f a c t i o n t o perfect
75
t
n otherwise imperfect g i f t and" obtain the fee simple: Dilwyn v Llewellyn. Lord Westbury,
, C f i n d s consideration i n the expenditure combined w i t h the father's knowledge and
approval thereof, and y e t 'does not make i t e n t i r e l y clear whether he considers the
case t o be one o f g i f t or one o f contract.'
I n ny view h i s d i f f i c u l t y i s unsurprising.
77
f i n a l l y Ramsden v Dyson
a f f i r m e d the p r i n c i p l e that acquiescence by an owner who sees
another spending money on the owner's property w i l l confer t i t l e on t h a t other where
^e, t o the owner's knowledge was under the mistaken b e l i e f t h a t the had t i t l e , or
I
I
would as a r e s u l t o f h i s expenditure obtain i t . The tenant was unsuccessful i n the case
£iince the l a n d l o r d d i d not have the r e q u i s i t e knowledge, nor the tenant the r e q u i s i t e
b e l i e f . However the p r i n c i p l e o f law now seems t o have gained some acceptance. (See l a t e r ) ,
\±(1806) 12 Ves 78.
];t i s clear t h a t a r i g h t o f a c t i o n e x i s t s t o compel performance o f a representation as
2
/ l 8 l l ) 18 Ves "328.
botnotes:
73
c f Alderson v Madison and Wakeham v Mackenzie (ante)
74
75
(1858) 25 Beav 72.
(1861-73) A l l iS R 38Uj UO.De-GF:& J 517-
76
P e t t i t : Squi-ty & the Law o f Trusts 1966 p66.
77
1866 LR 1 HL 129.
P T 0
39
to t i t l e , or i n t e n t i o n t o create t i t l e , t o land, i f the representee had spent money on
the
strength of the representation. .1 would suggest t h a t the proposition i s capable
of g e n e r a l i s a t i o n , and that expenditure o f money on the f a i t h o f the representation i s
merely evidence upon which the Chancellor may a c t i f he considers t h a t but f o r h i s
i n t e r v e n t i o n an i n e q u i t y would occur. And j u s t as expenditure o f money alone w i l l not
lead i n e v i t a b l y t o the operation o f equity,
so i n a proper case presumably a court
of equity o r i t s successor w i l l not hesitate t o apply the p r i n c i p l e where there has
79
been no isuch expenditure. Wakeham v Mackenzie
was a case i n which r e l i e f was given.
The declared basis f o r r e l i e f was the existence of part-performance, but as Jackson
80
suggests
the condition t h a t equity would not r e l i e v e save where the promisee had
acted t o h i s detriment became confused w i t h the s i m i l a r p r i n c i p l e that the Statute o f
Frauds could be circumvented only where there had been p a r t i a l performance o f the
asserted o b l i g a t i o n . The same a r t i c l e convincingly argues t h a t t h i s requirement.was
f u r t h e r confused w i t h the contractual requirement o f consideration, w i t h the resultant
p e t r i f i c a t i o n o f a most u s e f u l t o o l .
Footnotes:
78
Ramsden v Dyson i s j u s t such a case, as I have indicated. See also the V i c t o r i a n
case o f Brand v Chris B u i l d i n g Society (l957 )VR625 i n which a defendant paid a
b u i l d e r t o construct a house i n a s i t e which he believed t o be the s i t e he had
purchased, but which i n f a c t belonged t o the p l a i n t i f f . The p l a i n t i f f a t the
m a t e r i a l time had no knowledge o f the mistake, and i n no way contributed t o the
defendant's b e l i e f . Thus the defendant was not able to c a l l i n a i d equitable
p r i n c i p l e s , n o t even the powerful embryo of unjust enrichment, presumably because,
i n medieval terminology, he had not done t h a t which i n good conscience lie ought
not
t o have done. Defendant was u t t e r l y responsible.
p
1968 IWLR 1175.
i]0
Estoppel as a Sword 81 LQR 8U.
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ko
Me must now look t o the period a f t e r l 8 7 3 j t o discover, not whether equity may s t i l l
bear c h i l d r e n - though as the e t h i c a l component of the law there would seem t o be no
reason why i t should not - but whether there i s any nourishment t o sustain one which,
I have argued, maintained an uncertain existence p r i o r t o t h a t date.
ill
111:1
To state t h a t the fusion of I873 was merely procedural i n s o f a r as i t a f f e c t s the
submissions made so f a r i s not t o der^ the influence of procedure on substantive law.
However, the p r i n c i p l e was already almost three centuries o l d , -Uiat i n the event of a
disagreement equity should p r e v a i l over common law. Section 25 of the 1873 Act d i d not
change the s i t u a t i o n , but, i n enabling a l l courts and judges t o dispense equity the Act
exacerbated c e r t a i n confusions already apparent i n the Court of Chancery"l" The era
surrounding the Tramways
decision, w i t h i t s glbony preoccupation w i t h stare decisis,
was not conducive t o r e c t i f i c a t i o n of these confusions, since t h i s necessitated a
frank appraisal of the r o l e o f the judge i n the lawmaking process^ Despite t h i s ,
however, i t may be possible t o f i n d leeways s u f f i c i e n t t o provide a 'slim catena of
a u t h o r i t y ' f o r a wider p r o p o s i t i o n than Lord Denning's.
The common law p o s i t i o n i n 1873 uiay he deduced from a number of cases: i n Ogle v Earl
Vane^ a forebearance case, the defendant was not able t o reduce damages payable by him
by reason of p l a i n t i f f ' s acceptance of a l a t e r d e l i v e r y date a t the defendant's request,
and f o r the defendant's b e n e f i t . There seems nothing inconsistent here w i t h the much
l a t e r case o f Rickards v Oppenheim^ f o r Vane was u l t i m a t e l y i n default. Had he performed
a t the l a t e r date, i t seems u n l i k e l y t h a t p l a i n t i f f , having agreed t o delayed performance,
could have succeeded i n an a c t i o n f o r damages, although the judgement of W i l l e s , J
might suggest t h i s .
Footnotes:
1
See the analysis o f Coles v P i l k i n g t o n L R 19 BQ 1 7 I I by Malius, V C: ' I f the
conduct o f one person induces another t o a l t e r h i s or her conduct, t h i s w i l l make
a binding c o n t r a c t . ' The consideration which he discovers i n that case i s perhaps
not t h a t which a contract lawyer would recognise, though he i s i n good company i n
mistaking Hammersley v De B i e l f o r a case on contract.
London Street Tramways v LGC (1898 )AC 37.5
. I n p a r t i c u l a r the judgement of
Lord Halsbury i s depressing.
3
As t o the English a t t i t u d e generally see Jaffe (ante),
i;
(1868) LEIIII QBD 272. See also Hickman v Haynes(l875)LR 8CP598.
(1950) 1 A l l iB R U20.
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k2
Two cases i n v o l v i n g companies. Re Bahia & San Francisco Railway Co^ and Hart v
7
Fronting and B o l i v i a South American Gold M n i n g Co
merely estop a company, having
accepted a person as a shareholder, from denying his status as such; i n other words the
defendant i s prevented from denying a representation of f a c t upon which p l a i n t i f f has
g
r e l i e d . Knights v W i f f e n
i s harder t o f i t i n t o t h i s category. A corn merchant s e l l s a
q u a n t i t y of barley t o one Maris, who r e s e l l s a p a r t t o the p l a i n t i f f before himself
taking d e l i v e r y - before i n f a c t the defendant com
merchant separates the consignment
from h i s stock. The defendant promises t o put the goods on the l i n e t o p l a i n t i f f on
r e c e i p t from him o f a forwarding note. A f t e r receiving payment from p l a i n t i f f , but
before paying the defendant. Maris goes bankrupt, and the defendant refuses to d e l i v e r •
to the p l a i n t i f f . P l a i n t i f f ' s a c t i o n i n trover i s successful. Prima facie the defendant's
promise t o d e l i v e r i s a representation of i n t e n t i o n which the p l a i n t i f f r e l i e d on by
taking no steps t o secure immediate d e l i v e r y , but the d o c t r i n a l d i f f i c u l t y i s overcome
t y seeing the representation as one o f f a c t ; namely t h a t the defendant has separated
the
consignment from the bulk and holds i t t o the p l a i n t i f f ' s order. On the facts t h i s
ljudgement i s not p a r t i c u l a r l y s a t i s f a c t o r y , but i t indicates quite c l e a r l y t h a t
Blackburn, J f e l t obliged e i t h e r t o hold the representation out of f a c t , or f i n d f o r
the
^!his
defendant.
common law p o s i t i o n was adopted t y Lord Selborne, LL i n the Citizens' Bank of
'The foundation
t h a Orleans
t doctrine
( o f& equitable
i s . .Bank
. n o t of
l i kNew
e l y Orleans?
t o be
]k)uisiana/
and theofNew
Canal
Banking Coestoppel)
v F i r s t which
National
cleparted from by t h i s court i s t h i s , t h a t i f a man dealing w i t h another f o r value makes
• itatements t o him as to e x i s t i n g f a c t s . . .without.. .which the party.. .would not enter
j.nto the contract.. .he.. . s h a l l be compelled t o make them good. But those must be
statements as t o e x i s t i n g f a c t s . ' The f a c t s were that the New Orleans bank, having
I'ema.tted funds t o a Liverpool bank, drew b i l l s on the Liverpool bank and sold them t o
I'ootnotes;
(1868) m i l QBD 581;.
(1870) LR>iSxch 111.
(1870) L R V QB660.
(1873). L R V I HL352.
P T 0
h3
the
Louisiana bank. I n order t o encourage the apparently r e l u c t a n t Louisiana bank,
reference was made t o the funds held i n Liverpool, and a promise was made s p e c i f i c a l l y
to appropriate a p a r t o f these funds t o the b i l l s sold. This was not done. Subsequently
the
New Orleans bank went bankrupt, a receiver was appointed, and i t was t o him alone
t h a t the Liverpool bank would agree t o pay the funds which i t held. The Louisiana bank
asserted unsuccessfully t h a t there had been an equitable assignment o f t h a t p o r t i o n o f
the
funds equal t o the value o f the b i l l s : or, i f not the receiver, as successor t o the
New Orleans bank was estopped from denying the s p e c i f i c appropriation necessary t o
create an equitable assignment.
A d i f f e r e n t f i n d i n g would have been q u i t e incor^jatible w i t h commercial understanding
and convenience'!'^ To have conferred p r i o r i t y upon the assignee i n these circumstances
would have a l t e r e d the nature o f negotiable instruments. Squally, t o have enabled the
assignor t o achieve p r i o r i t y f o r the assignee through a promise 'followed by no action to bind other c r e d i t o r s by such a promise - would i n i t s e l f be inequitable. I n these
circumstances the decision i n Hammersley v De B i e l (ante) was not urged w i t h any force
^by counsel f o r the appellant, nor was i t even r e f e r r e d t o by Lord Selborne, who
p a r t i c i p a t e d , f o u r years l a t e r , i n Hughes v Ifetropolitan Ry^"*" a decision much more i n
Line w i t h Hammersley v De EiLel. and contrary i n s p i r i t t o the Citizens' Bank of Louisiana.
In Hughes, wherein Denning, J found a u t h o r i i y f o r h i s 'new equity', the term equitable
3stoppel was not used, nor were there c i t e d the cases t o which I have r e f e r r e d . Instead,
[.ord Gaims r e l i e d on an inscrutable ' f i r s t p r i n c i p l e of equity.' Far, however, from
suggesting t h a t t h i s i s a new equity, or t h a t Jorden v Money and The C i t i z e n s ' Bank of
ouisiana have so r e s t r i c t e d the o l d one as t o render i t i n e f f i c a c i o u s , the law as t o
: representations may be seen t o have been quite . f l u i d . The foundation i n 1865 o f the
j o u n c i l incorporated i n I87O as the Incorporated Coiancil o f Law Reporting f o r England
and Wales, together w i t h the amalgamation o f the courts o f co-ordinate j u r i s d i c t i o n i n .
;rootnotes:
io
Not t h a t the House i s incapable o f upsetting commercial understanding - or t h a t o f
lawyers.cf Derry v Pe9k(l889)1U Ap Gas 337 w i t h Storey on Equity Jurisprudence
(1866) 751 e t seq.
2[l
1877 2 Ap Gas h39.
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the Supreme Court of Judicature were followed t y a congealing of j u d i c i a l i n i t i a t i v e ,
the climax o f which was the Tramways (ante) dictum o f I898. I t may have been a conscious
or unconscious wish on the p a r t of the House t o preserve a fragment of the wider equity
by asserting i t s q u a l i t a t i v e pecxxliarity i n Hughes. Their Lordships may have noticed
the clash between the p r i n c i p l e i n Hammersley v De B i e l and that of The Citizens' Bank
o f Louisiana and t h e i r respective predecessors. At any rate w i t h hindsight we may
observe
t h a t there was a clash, and t h a t i n an era i n which the need f o r • c e r t a i n t y was
12 '
constantly expressed, a f l e x i b l e equitable doctrine was u n l i k e l y t o survive i n t a c t
13
when equity i t s e l f had f o r some years evinced a concern f o r c e r t a i n t y .
I t .is an
i n d i c a t i o n of the paramount u t i l i t y of the equity t h a t i t survived sp'far as i t
affected r e a l property and waivers of e x i s t i n g contracts. I n t h i s emaciated form we
may
see i t presently i n operation and - though t h i s does not e x i s t s u f f i c i e n t t o support a
wider p r i n c i p l e of equity - f o r this-reason i t i s convenient to t r e a t Hughes v
^fetropolitan ^y as a Watershed.
111:2
r
The p l a i n t i f f i n Hughes v Metropolitan I ^ " * ^ served on the defendant compaiy a notice
^0 r e p a i r , ,In r e p l y the defendant r e f e r r e d t o the shortness of the remaining term and
queried, the usefulness o f carrying out the r e p a i r s , suggesting instead, terms f o r
surrender. The landlord's s o l i c i t o r i n d i c a t e d t h a t althpugh the terms were extravagant,
more r e a l i s t i c ones might be acceptable; he r e i t e r a t e d the need f o r repair. No f u r t h e r
csommunications were exchanged, and the company c a r r i e d out the r e p a i r s , but outside
•ihe s i x months allowed from the date of the o r i g i n a l notice'!^
The question that arose,
"iherefore, was whether the l a n d l o r d could f o r f e i t the lease. He had c l e a r l y not
2
See Abel-Smith & Stevens: Lawyers & the Courts ppl23 e t seq.
]i'ootnotes:
X3
See Lord Eldon i n Sheddon v Goodrich, 8 7esl4.8l a t pU87. ' I t i s better t h a t the law
should be c e r t a i n than t h a t every judge should speculate upon improvements.'
ili
Moral r e p r e h e n s i b i l i t y i s not necessary. James L J's f i n d i n g t h a t the l e s s o r ' l u l l e d
the defendants t o sleep, i n t e n t i o n a l l y l u l l e d them t o sleep u n t i l i t was too l a t e
f o r them to do the r e p a i r s ' was disapproved. See Wilmott v Barber LRl5 Gh 96 a t
PI05 per Fry,
J.
P T 0
represented a f a c t - namely t h a t the time allowed f o r repair was extended - f o r t h a t
would be s t r a i n i n g ttie circumstances t o f i t a conception'!'^ ^
h i s conduct, however, he
may have represented an i n t e n t i o n not t o enforce the notice u n t i l a reasonable time
a f t e r the breakdown of negotiations. This was Lord Cairns' ' f i r s t p r i n c i p l e , ' one 'upon
which a l l courts o f equity proceed, that i f p a r t i e s who have entered i n t o d e f i n i t e and
d i s t i n c t terms i n v o l v i n g c e r t a i n l e g a l r e s u l t s - c e r t a i n penalties or l e g a l forfeiture"^afterwards hy t h e i r own act or w i t h t h e i r own consent enter upon a course of negotiations
which has the e f f e c t of leading one of the p a r t i e s t o suppose t h a t s t r i c t l e g a l r i g h t s
under the c o n t r a c t w i l l not be enforced, or w i l l be kept i n suspense, or held i n
abeyance, the person who might otherwise have enforced those r i g h t s w i l l not be allowed
to enforce them where i t would be inequitable having regard t o the dealings which.have
17
taken place between the parties."'
The Chancellor having f i r s t entered the l e g a l arena as one who comes between the subject
jand h i s s t r i c t r i g h t s i n law where t o allow him those r i g h t s would be against conscience,
i t i s scarcely s u r p r i s i n g t o see Lord Gaims, L C doing j u s t
ttiisj
what i s s u r p r i s i n g ,
however, i n the l i g h t of conventional wisdom, i s t h a t a statement of an i n t e n t i o n should
be w i t h i n the purview of conscience i n a 19th centuiy court of equity. This w r i t e r ' s
Footnotes:
l5
On^. the lawyer's tendency t o do t h i s , see Jiiering on the Conceptualist's Heaven
I
discussed; Stone: Legal System p226; t r a n s l a t e d ( i n p a r t ) i n 11 Pol Sc
Q
307.
This does not seem t o be an unduly nice p o i n t : the period i s delimited by the
r i g h t t o enforce. I f the appellant has represented t h a t the period i s i n f a c t
extended, he i s i n d i c a t i n g an i n t e n t i o n not to enforce t h i s r i g h t , a t l e a s t , f o r
a time - such time as may be reasonable i n the circumstances.
See Carr v LMWR (l875) LR10GP317.
Espley V Wilkes LRVII Exch 298 (estoppel t y deed).
Hart V Frontino and B o l i v i a South American Gold Mining Co I£LY Exch 111.
lj7
(1877) 2 App Gas i;39 a t pliU8.
P T 0
h6
hypothesis seema t o be supported, on t h i s view of the case. No p a r t i c u l a r e f f o r t was
made t o disguise the support given t o the statement o f i n t e n t i o n , nor was any apology
o f f e r e d f o r not f o l l o w i n g Jorden v Money, or the l i n e o f common law cases'!"^ Instead the
decision i s consist>ent w i t h there being i n existence an equitable p r i n c i p l e such as we
have urged.
Having discussed the case i t i s perhaps opportune t o suggest that the d i f f i c u l t i e s
encountered l a t e r as t o the tiemporary or permanent nature o f the equity whose o r i g i n
18
Denning, J ascribed t o Hughes
are hard t o understand. I t may be t h a t they are
engendered by a misconception o f the nature o f the equity. Common lawyers, whose
subject i s rooted h i s t o r i c a l l y i n iihe i m m u t a b i l i t i e s o f r e a l property, are given t o
casting one eye upon e t e r n i t y , and a p r i n c i p l e whose longevity i s governed according
to
common sense, equity and fairness may be i n d i g e s t i b l e .
The same year, a t Durham Assizes, Stephen, J dealt s h o r t l y w i t h an attempt t o gain a
19
| l i f e i n t e r e s t t y means of an estoppel.
Here a housekeeper was induced t o remain i n
service and t o forbear t o sue f o r past wages owed t o her l y the deceased i n r e t u r n f o r
||iis promise t o confer on her a l i f e i n t e r e s t i n h i s form a f t e r h i s death. His i n t e n t i o n
was implementied t o the p o i n t of h i s making an improperly executed w i l l , but 'to say
ihat Alderson's heir-at-law i s estopped by Alderson's conduct from denying the v a l i d i t y
(bf the i r r e g u l a r l y a t t e s t e d w i l l would be t o repeal the Statute of W i l l s . . . .' Instead
Stephen, J was content t o invoke the b e t t e r - e s t a b l i s h e d doctrine o f part-performance
20-21
and t o use h i s own tierminology, 'repeal' the Statute o f Frauds,
f i n d i n g i n the
housekeeper's forbearance s u f f i c i e n t t o serve as consideration f o r a contract. He
clsapproved Lord St Leonards' d i s s e n t i n g judgement i n Jorden v Money, and, as we have
jiuggested, mistakes Hammersley v De B i e l f o r a case o f contract,
1,8
See the Tool Metal case and the authors c i t e d i n r e l a t i o n t o i t (post).
i'ootnotes:
19
Alderson v Madison (I88O) 5 £x D 293.
2|0
'Decorous disregard' might be more appropriate. See Spencer v Hammerde (1922)
2AG 507 a t •ip5l9, c i t e d Megarry & Wade 2nd Ed p555.
2tl
c f 11:1 n 2A.
Again, resistance t o estoppel t o prevent 'repeal' o f the w r i t i n g
requirements.
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ii7
22
I n the House of Lords
Lord Selbome predictably adopts the same stance i n r e l a t i o n
t o estoppel as he d i d i n F i r s t National Bank (ante) but disagrees w i t h Stephen J as t o
the existence o f p a r t performance
s u f f i c i e n t t o prevent the Statute of Frauds from
23
applying. The decision i s inconsistent w i t h t h a t i n Hughes, which was followed i n 1888
i n the Court o f Appeal?^ We have noted the inconvenience accoii?)lished by the decision
25
i n Foakes v Beer
as w e l l as the weaknesses which undermine i t . Insofar as i t i s
26
based on Pinnel's Case
i t i s worth repeating t h a t the inchoate condition of the law
o f contract i n the e a r l y 17th century provides l i t t l e i n the way of foundation. Further,
27
the r e l i a b i l i t y o f Coke's Reports has r e c e n t l y been questionned, and the 'horse, hawk
28
29
or robe' f i c t i o n over-ruled. I t seems unsatisfactory t o argue, as T r i e t e l does, t h a t
the Hughes equity i s merely suspensory, f o r Lord Caims nowhere suggests t h a t h i s
f i r s t p r i n c i p l e i s temporary of necessity^*^ and Lord Selbome makes no attiempt to
d i s t i n g u i s h Hughes on t h i s or any other ground. Foakes v Beer, i n short, t e s t i f i e s t o
there being two l i n e s of a u t h o r i t y : the Hughes p r i n c i p l e , despite Lord Chancellor
Selborne's opposition t o i t , looks back to" Hammersley v De B i e l and i t s ancestors i n
equity, w h i l s t Foakes v Beer looks t o Pinnel's Case and Jorden v Money. As I have
Footnotes:
(22
1883 8 App Gas
467
I
Over-ruling Sevart, V C i n Loffus v Moore (I863) 3Cliff592 and disapproving
I
Hammersley, upon which Stuart, V C r e l i e d .
23
The d e c i s i o n seems almost unnecessarily harsh, f o r i n the circumstances the w i l l
would surely have suffered as a w r i t t e n memorandum: Re Holland(1902) 2ch360 a t p383The forbearance could have amounted t o consideration had the court wished. As t o
s p e c i f i c r e f e r a b i l i t y , see M & W 2nd Ed p559 & Note 7i;.
kk
Birmingham & D i s t r i c t Land Co v LNWR(1888)U0 Ch D 268.
^5
(188U)9 App Gas
605.
16
(1602)5 Co Rep
1170.
27
See Baker: New L i g h t on Slade's Case'. 1971 CLJ51. Also comment i n Lloyd:
Jurisprudence 3rd Ed p70i| n8.
28
D & G Builders v Rees(1966)2QB 617.
29
Contract 3rd Sd pl05.
30
See the remarks of Lord Denning M R i n W J Alan v E l Nasr (post)(1972 )2 A l l E R 127.
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1;8
suggested t h a t the l a t t e r i s , i n s p i r i t , since i t i s by no means a clear decision, more
consistent w i t h common law p r i n c i p l e s than w i t h equity, there i s l i t t l e significance
i n i t s having a r i s e n on appeal from the Court of Appeal i n Chancery.
Accepting t h a t a smaller sum may not discharge an o b l i g a t i o n t o repay a l a r g e r sum l e n t ,
which seems a not unreasonable i n t e r p r e t a t i o n of Foakes v Beer, we f i n d the equitable
enforcement of promises of i n t e n t i o n s h e l t e r i n g i n h o s t i l e circumstances behind p r i o r
31
3?
negotiations. I n Birmingham & D i s t r i c t Land Co v London and North Eastern Railway Go
the appellant occupied land under three separate leases which contenqjlated t h a t b u i l d i n g
would commence before the e x p i r a t i o n of a c e r t a i n tierm. I t became known t h a t the
respondent company was seeking s t a t u t o r y powers to purchase land, possibly some p a r t
of t h a t occupied t y tihe appellant. To continue w i t i i the i n t e n t i o n to b u i l d was
inappropriate since even were the respondents to purchase other land, the proximity of
a railway would a l t e r the class of house i n demand. At the suggestion of the landlord's
agent, t h e r e f o r e , and i n conformity w i t h t h e i r own best i n t e r e s t s , the appellants
suspended t h e i r operations.The respondents duly purchased some of the landlord's
Droperty,
subject t o the appellants' b u i l d i n g lease, and the question of compensation
arose. I t was the contention o f the appellants t h a t calculations should be on the basis
o f subsisting b u i l d i n g agreement, w h i l s t the respondents r e l i e d on the e x p i r a t i o n o f
•ihe term w i t h i n which b u i l d i n g should heave taken place. The appellants claimed, on the
a u t h o r i t y of Hughes v Metropolitan Ry (ante), t h a t the landlord had t y h i s conduct i n
jidvising the suspension of b u i l d i n g promised not to i n s i s t on his s t r i c t l e g a l r i g h t s
j i t the end of the term. As h i s successor, and w i t h notice of the leases and the
agreement
to s u s p e n d b u i l d i n g ,
LNWR were t h e r e f o r e bound by the p r o m i s e : c o m p e n s a t i o n
T,ias t o be assessed as i f the lease subsisted. Persons w i t h 'contractual r i g h t s against
cithers (who) induce t y t h e i r conduct those others...to believe t h a t such r i g h t s w i l l
not be enforced or w i l l be kept i n suspense or abeyance f o r some p a r t i c u l a r time.. . w i l l
r.ot be allowed by a court of equity t o enforce the r i g h t s u n t i l such time has elapsed
Bootnotest
3p.
1877
2 App Cas i;39 a t plii;7 per Lord Cairns, L C.
32
1888 ho Ch D 268.
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h9
without a t a l l events placing the p a r t i e s i n the same p o s i t i o n as they were i n before.'-^-^
W h i l s t denying t h a t Hughes applies only t o cases of f o r f e i t u r e , Bowen, L J attempted
to t i e i t t o s i t u a t i o n s i n v o l v i n g waiver of pre-existing contractual r i g h t s . He d i d
not i n the Birmingham case r e f e r t o estoppel, but was three years l a t e r , i n Low v
Bouverie"^^ t o declare t h a t 'estoppel i s only a r u l e of evidence. l o u cannot found an
a c t i o n upon an estoppel.. . i t i s only important as being a step i n the progress towards
r e l i e f on the hypothesis t h a t the defendant i s estopped from denying something he has
s a i d . ' C l e a r l y he i s d e f i n i n g something d i f f e r e n t from the Hughes p r i n c i p l e , since he
makes no attempt t o r e s t r i c t estoppel to contractual s i t u a t i o n s , as he was a t pains t o
do i n the e a r l i e r case^^ Might the Hughes-Birmingham phenomenon, therefore, not.support
a cause of action?
I t i s h e l p f u l t o see Plimmer v Mayor etc of Wellington i n the l i g h t of Hughes and
Birmingham, bearing i n mind p a r t i c u l a r l y the r o l e which equity assumed i n those cases,
o f preventing the exercise of l e g a l r i g h t s . This r e c a l l s the negative method by which
the doctrine of the t r u s t came t o be recognised. John Plimmer had i n l8i4.8 moored a hulk
on the foreshore a t Wellington, and w i t h the Crown's consent used i t as a wharf and
store. At the P r o v i n c i a l Government's suggestion i n 18^6 he b u i l t an extension and more
b u i l d i n g s , t o accommodate imomigrants f o r whose use of the f a c i l i t y the Government paid
Plimmer. During a reconstruction o f the harbour he retained a temporary access from h i s
wharf, to the shore by means of a gangplank, and i t was not u n t i l I878 t h a t the
P r o v i n c i a l Government i n d i c a t e d by a l e t t e r from the Secretary of Customs t h a t the
wharf was without the 'sanction or a u t h o r i t y o f the Government.• ' I f t h i s , ' says the
j j u d i c i a l committee's decision, 'was meant t o apply t o the whole wharf i t i s a t variance
37
•with the whole preceding h i s t o r y of the case.'
Footnotess
33
1888 kO Ch D 268 a t p 287 per Bowen, L J.
3U
1891 3 Ch 82 a t pl05.
3^
Though w i t h o u t the concurrence of Lindley L J i n Birmingham.
36
1881; 9 App Gas 699. An appeal t o the P r i v y Council from a decision of the New
Zealand Court of Appeal on a case stated.
^7
At p707.
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50
Subsequently the land was vested i n the Corporation of Wellington by Statute, and i n
due course ejectment proceedings were brought by the Corporation against the occupiers.
The Public Works Act of 1872 set up a Compensation Court, and provided for the payment
of compensation t o 'every person who immediately before the date of the... (Vesting Act)
had any estate or i n t e r e s t i n . . . t h e lands vested i n the Corporation.' I t i s worth noting
the proviso t o section
of the Public Works Act t h a t ' i n ascertaining.. .the t i t l e of
any claimant t o compensation the Compensation Court s h a l l not be bound to regard s t r i c t '
l e g a l r i g h t s only but...any claim which the Compensation Court may consider reasonable
and j u s t having regard t o a l l the circumstances,'
f o r i t was s u f f i c i e n t to enable the
Committee t o take a wide view of the expression ' i n t e r e s t i n land.'
The Committee noted the p o l i c y of the P r o v i n c i a l Government before 186?, which was
not
to b u i l d i t s own landing stages f o r immigrants but t o use those already i n existence
i n p r i v a t e hands - a p o l i c y responsible f o r the Government's encouragement to John
Plimmer to extend h i s wharf i n 1856.
I t was t h i s encouragement which rendered '
inequitable the ejectment of the occupier without compensationt and presumably the
r e p e t i t i o n of t h i s p r a c t i c e , leading to a number of ambiguous occupations of the foreshore,
i n s p i r e d the proviso to section k of the condensation s t a t u t e . Reading the case i n i t s
context thus, r a t h e r than Ramsden v Dyson (ante) i t was the Statute t h a t l e t i n regard
Cor fairness and equity which f a c i l i t a t e d Plimmer's claims. An unfortunate lack of
c l a r i t y i n the f i n a l p a r a g r a p h o s f f i ^ judgement read by S i r Arthur Hobhouse has perhaps
ijonfused l a t e r discussion o f the case: ' t h e i r Lordships have no d i f f i c u l t y i n deciding
that the equitable r i g h t acquired by John Plimmer i s an i n t e r e s t i n land carrying
39
(;ompensation under the Acts...'
Speculation on the status of h i s i n t e r e s t i n land i s
jDointless since the Statute i s not concerned only w i t h ' s t r i c t l e g a l r i g h t s . ' Leave
•iiside the vesting Act o f 1880 and the only i n t e r e s t i n land i t i s useful t o postulate
:.s t h a t possessed by the P r o v i n c i a l Government. I t would be inequitable to permit the
J l e t t i n g up o f t h i s l e g a l t i t l e to deprive without compensation the occupier who
had
4"ootnotess
8
At p
708.
9
At p709s the emphasis i s mine. I n other words, e q u i l y requires t h a t he be brought
w i t h i n s e c t i o n I4..
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51
been encouraged by the owner t o spend money on the property^f''^ Ramsden v Dyson would
require t h a t the Government had knowingly exploited a mistaken b e l i e f by Plimmer t h a t
he possessed the freehold!^'" and there i s no evidence t h a t i t d i d so. The Hughes and
Birmingham cases are more apposite^^ and I , submit t h a t a t t e n t i o n t o them confers
Footnotes-:
i|.0
c f the support l e n t by e a r l y equity t o the cestui que, use as against the
That the b e n e f i c i a r y must now have an i n t e r e s t i n land (Settled Land Act 1925) i s
hardly the p o i n t . Suggestions t h a t a b e n e f i c i a i y under an equitable estoppel must
have an i n t e r e s t i n l a n d are misguided f i d e l i t y t o analogy. We have here a s i m i l a r
but newer equity.
i;l
Or had represented t o him t h a t a s p e c i f i c i n t e r e s t would be conveyed t o him e g, i n the case, a lease f o r years t o a tenant a t w i l l .
i|.2
Though see the two common law cases c i t e d i n Plimmer a Winter v Brockwell (1807)
8 Bast 308, and L i g g i n s v Inge ( I 8 3 I ) 7 Bing 68ai\ I n the former, having assented
j
t o h i s neighbour's construction of a s k y l i g h t p l a i n t i f f could not, without
a f f o r d i n g compensation t o the defendant, require him t o remove i t , even though i t
prevented the p l a i n t i f f from receiving fresh a i r through h i s own window. I n the
l a t t e r the defendants lowered a r i v e r bank by ten f e e t and b u i l t a weir, depriving
plaintiff's
Ser,jEaait
father of some of the flow t o h i s corn m i l l , but w i t h h i s consent.
Merewethaiii argues ( a t p687) ' I f the grantee be l e d i n t o expense by the
l i c e n c e , h i s remedy i s i n equity and not at law,' but Tindal, C J considered not.
'...the operation e f f e c t o f the licence a f t e r i t has been completely executed by
the
defendants, i s s u f f i c i e n t without holding i t t o convey any i n t e r e s t i n the
water t o r e l i e v e them from the burden of r e s t o r i n g t o i t s former state what has
been done under the l i c e n c e , although i t has been countermanded (p691). '
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52
greater coherence than more recent confusions!^'"^
Having thus considered the 'watershed' cases and suggested t h a t what we observe i n
a c t i o n i s equity acting t r a d i t i o n a l l y i n r e s t r a i n t of l e g a l r i g h t s , and having indicated
t h a t motivating t h i s r e s t r a i n t i s the need to redress a balance destroyed t y a
representation by the promissor. We
between f a c t and opinion. The
should also note the nice nature of the d i s t i n c t i o n
cases which we have already explored serve to i l l u s t r a t e
the c a s u i s t i y required to conceptualise f a c t and i n t e n t i o n and place them i n separate
compartmentss these cases do not atteinpt to d i s t i n g u i s h on r a t i o n a l , but on h i s t o r i c a l
grounds. I t i s not suggested, f o r example, i n Jorden v Money, that e f f i c a c y on the
hand, or j u s t i c e on the other, d i c t a t e the d i s t i n c t i o n s merely, i t i s said,
one
authority
does so7
Between f a c t and opinion, I submit, a greater gap e x i s t s , than between f a c t
i n t e n t i o n ^ That a man
intends to b r i n g about a state of a f f a i r s i s a f a c t , though i t
would b e n e f i t a p l a i n t i f f l i t t l e to prove merely the f a c t t h a t an i n t e n t i o n
S i m i l a r l y , t h a t a man
and
existed.
has an opinion t h a t a state of a f f a i r s e x i s t s , however unreasonable
Footnotes:
14.3
See
Binions v Svans ( l a t e r ) . Mrs Evans should be able to e i t h e r j o i n the vendor-
l i c e n s o r by means of a t h i r d - p a r t y procedure, so as to make assertion of l e g a l
t i t l e t o e j e c t her a breach of contract: or raise an equity i n her own favour, to
prevent the Binions' l e g a l r i g h t s ever being used unconscionably at her expense.
Had
they not bought w i t h knowledge of her occupation, the p o s i t i o n i s s i m i l a r to
t h a t of a purchaser of registered land subject to a short lease. However, the
p o i n t i s t h a t Mrs Evans does not need an i n t e r e s t i n land. And
ii6LQR12. See
see Cerbin (supra)
also Crane: Estoppel'Interests i n Land 3 I Conv (NS)332 ( l a t e r ) .
I+2A L o g i c a l l y and w i t h equal lack of pragmatism one could argue t h a t lawyers are
prepared to countenance an estoppel where a statement about the past has been
• made, and a d d i t i o n a l l y where a state of a f f a i r s has been denied. S t r i c t l y ,
neither can be a representation of an e x i s t i n g f a c t ,
ill
See
Craine v Colonial Mutual Fire Insurance (1920) 28 CLR
30^,
a t p32U (post).
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53
his opinion, i s a f a c t . Departing from l i n g u i s t i c analysis, an examination of t h e i r
e f f e c t s suggests t h a t reasonable r e l i a n c e i s more l i k e l y upon a statement of i n t e n t i o n
than upon a statement of opinion. A statement t h a t a man w i l l b u i l d a house, or w i l l
confer peaceful possession, may w e l l be acted upon, w h i l s t a statement t h a t a man thinks
t h a t a house e x i s t s ought t o provoke an i n t e r e s t e d party t o discover f o r himself
whether i t does.
The answer t o a p o t e n t i a l insurer'rs question 'Are you. temperate?' may have been an
Ii.3A
opinion.
'There are f a c t s innumerable,' said Lord Watson, 'which can be ascertained
only by a t e s t of opinion, but they are none the less f a c t s i n law, whatever they may
|be i n a metaphysical sense.'^^ Thus the insured was taken to have misrepresented a
I m a t e r i a l f a c t , and the p o l i c y was avoided. I n Smith v Land & House Property Corporation^^
a property i s described as ' s a t i s f a c t o r y ' by the vendor, w h i l s t the experience of the
Ipurchaser who refuses t o complete i s t h a t i t i s quite the reverse. ' I t i s material t o
Dbserve t h a t i t i s often f a l l a c i o u s l y assumed t h a t a statement of opinion caimot
Involve a statement of act...¥here the f a c t s are equally w e l l known.. .what one (party)
isays t o the other i s frequently...an opinion. (This) i s . . . a f a c t about the condition
i f a man's mind.. .but.. . i t i s of no consequence what the opinion i s . But i f the f a c t s
are not e q u a l l y w e l l known t o both sides, then a statement of opinion by one who knows
best involves...a statement of m a t e r i a l f a c t , f o r he impliedly states t h a t he knows of
f a c t s which j u s t i f y h i s o p i n i o n ^ I n other-words, what i s important i s the e f f e c t which
i.he
statement has on the other p a r t y , i n s o f a r , presumably, as t h i s i s i n the circumstances
ustified.
footnotes:
43A Though Lord Blackburn thought not. Bearing i n mind the evidence t h a t the insured
drank r a t h e r more l i q u o r than h i s fellow town councilors he was no doubt j u s t i f i e d
''"^'irl-^avoiding 'metaphysics.'
li5
Thomson v Meems 1881; 9 Ap Cas 67I: a S c o t t i s h Appeal.
I|6
1881; 28 Ch D 7.
147
See also per Bowen, L J i n Edgington v Fitzmaurice 29 Ch D h^9
a t pl;83: 'There
must be a mis-statement of an e x i s t i n g f a c t , but the state of a man's mind i s as
much a f a c t as the state of h i s d i g e s t i o n . '
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1 A
fencer-Bower & Turner,
i n discussing the supposed f a c t - i n t e n t i o n d i s p a r i t y , admits
t h a t 'there are very few assertions o f i n t e n t i o n which ingenious casuistry cannot
p l a u s i b l y t r e a t as i n v o l v i n g promises^ and very few promises from which a representation
o f e x i s t i n g capacity and readiness t o perform an engagement cannot w i t h eqiaal p l a u s i b i l i t y
be i n f e r r e d . ' The energy spent i n exposing such ingenuity may be c r i t i c i s e d when the
result''has been i n margr cases t o leave Just expectations disappointed.'
111:3
I t i s c l e a r l y i n the i n t e r e s t s o f any society t h a t f a i r dealing should receive
encouragement, and as the common run o f transactions becomes more complex, so the
conception o f f a i r dealing must expand. I f barter and immediate exchange f o r cash are
the p r i n c i p a l forms o f t r a d i n g then society's wellbeing requires t h a t .both goods and
currency be what they appear t o be, a t the p e r i l of the person presenting them. When
exchanges o f promises and the buying o f future goods become usual, and when an
increasingly specialised society necessitates reliance on data provided by experts,
bhen i t becoiTBs i n c r e a s i n g l y v i t a l t o encourage r e l i a b i l i t y by compensating those who
suffer from the l a c k o f i t . These are not the 'fine-spun speculations of visionary
U9
• Jieorists,'
but the basis upon which decisions must be founded i f the law i s t o
i i a i n t a i n c r e d i b i l i t y , ' . . . i t may be t h a t judges are no b e t t e r able t o descem what i s
J'or the p u b l i c good than other experienced and enlightened members o f the community,
t u t t h a t i s no reason f o r t h e i r r e f u s i n g t o e n t e r t a i n the question and declining t o
cecide upon i t . ' ^ " ^ Exari)les p r o l i f e r a t e , o f j u d i c i a l value-decisions, a r t i c u l a t e d and
c therwise^"''
l i e have already suggested t h a t the law's laggard response t o developing commercial
52
n.orality has c o n t r i b u t e d t o the decline i n l i t i g a t i o n i n the coxxrts -upon the subject,
footnotes
148
Estoppel by Representation 2nd Ed para 31.
il9
per Lord Halisbury i n Janson v D r i e f o n t e i n Consolidated Mines(l902)AC h^h a t pl;91.
50
Per Pollock, C B i n Egerton v E a r l Brownlow (1853 )1HL Cas 123 a t p l 5 l .
5L
For a recent example see the comments o f Blom-Cooper & Drewry
on Morgan v Tate
& Lyle(l955)AC21 i n F i n a l Appeal (1972) p325.
5^
See C i v i l J u d i c i a l S t a t i s t i c s 1971 Table A Grand i;982 c i t e d Zander: Cases &
Materials on the English Legal System p5.
P T0
There are those s o c i a l demands upon the system which, when thwarted d i r e c t l y , reappear
i n d i r e c t l y when l e g i s l a t i o n does not come t o the rescue.'^ Over-subtlety leads to
entanglement w i t h doctrine and a respectable motive i s d i s c r e d i t e d t y use of the maxim
about 'hard cases.'.
We have noted t h a t equitable regard, f o r promises has to some extent taken refuge behind
the waiver s i t u a t i o n ; but we have also submitted t h a t the essence of the equity
remains. An hypothesis viewing law as an adjustment of i n t e r e s t s ^ ^ might obviate f o r
c e r t a i n l i m i t e d purposes the need f o r a d i s t i n c t i o n between public and p r i v a t e law:
s i m i l a r l y an i n v e s t i g a t i o n i n t o the r e c o g n i t i o n of promises might question f o r c e r t a i n
purposes the claim t h a t the law o f r e a l property i s q u a l i t a t i v e l y d i f f e r e n t from other
branches of law i n modem times. Why
should the p o l i c y of the 1925 property l e g i s l a t i o n ,
f o r example, enjoy paramountcy over the.necessity f o r p r o t e c t i n g a deserted spouse?.-^5
The h i s t o r y of the common law i s a h i s t o r y of the law of property - p r i m a r i l y of r e a l
Footnotes:
P3
AS i t d i d f o l l o w i n g Perry v Peek (1889) ll; App Cas 337: 'this unfortunate decision
(Palmer's Company Law 21st Ed plO) was modified t y the Director's l i a b i l i t y Act
1890'. And Rookes v Barnard(l961i)AC
1129.
See Stone: Social Dimensions of Law and Justice pl6U et seq; Human Law & Human
Justice pl75« Some of the State's claims may seem less urgent i f viewed as the
claims o f i n d i v i d u a l s t o l e g a l r e c o g n i t i o n of i n t e r e s t s . This i s not to enter
the debate between s o c i o l o g i s t s and psychologists as to whether society i s
something q u a l i t a t i v e l y d i f f e r e n t from the aggregate of those who compose i t ,
on
which - I - : confess t o t a l ignorance.
As i n IjPB V Ainsworth(l965)AC 1172. On the question of social necessity and the
property l e g i s l a t i o n see Goodman: Adverse Possession ^3 MLR 281, p a r t i c u l a r l y p28l-2
though c l e a r l y he i s taking i n t o account the need f o r c e r t a i n t y . How does the
p o s i t i o n of a purchaser d i f f e r , however, i f he unknowingly buys land l o s t through
adverse possession, from i f he buys land subject to an equity?
The answer may be t h a t m u l t i p l y i n g the hazards i s undesirable, but no
I would
argue s o c i a l necessity.
P T 0
56
property - w i t h a n c i l l a r y concernsl^ but t h i s merely r e f l e c t s the p o l i t i c a l power o f
property owners. Today we might reverse our p r i o r i t i e s , or change them to s u i t our
convenience. Not only i s change necessary, but an extension of j u r i s d i c t i o n , t o which
57
j u d i c i a l resistance i s considerable.
With these suggestions we can examine the cases a f t e r Plinmier as f a r as -High Trees
A number of cases r e s t r i c t the courts' j u r i s d i c t i o n over promises. To Deny v Peek I
have adverted^"*" the r e s u l t here was so b l a t a n t l y unfortunate a t a time when accumulations
of c a p i t a l by means of public subscriptions t o separate l e g a l persons were becoming
v i t a l t o the conduct of commerce t h a t l e g i s l a t i o n was soon procured t o avoid the
HO
decision's e f f e c t upon representations by companies.
Ijiowe
v Bouverie
belongs to the
p r o t r a c t e d hlsttry of l i a b i l i t y f o r negligent mis-statement. A representation was made
t y the t r u s t e e o f a fund t o a p o t e n t i a l c r e d i t o r concerning incumbrances on the
i n t e r e s t i n the fund held ty the p o t e n t i a l debtor. Relying on the representation the
p l a i n t i f f l e n t Admiral Bouvenie a sum of money on the security of the i n t e r e s t , afterward
iiscovering t h a t there were incumbrances on the i n t e r e s t p r i o r to h i s own, of which the
defendant t r u s t e e had 'forgotten' a t the time of the representation. The merits of the
judgement are hard t o f i n d . Estoppel was not applicable, i t was held, because the
defendant had not promised t h a t there were no incumbrances; he had instead forgotten
ihose which defeated the p l a i n t i f f . Bowen, L J's d e f i n i t i o n encompasses common law
estoppel upon which 'you cannot found an action... ( i t ) i s only a r u l e of evidence...
important as being one step towards r e l i e f on the hypothesis t h a t the defendant i s
footnotes:
^6
See Milsom: H i s t o r i c a l Foundations p88 '...the economic basis of society was
agrarian.' I t may be an exaggeration, however, t o say t h a t 'today we t h i n k of the
ownership of...a great a g r i c u l t u r a l estate as being something l i k e the ownership
of a motor car.'
^7
On t h i s see: Donoghue v Stevenson( 1932)AC5t3(dissenting Judgements)
Grant v A u s t r a l i a n K n i t t i n g Mills(1936)AC85
Also Jones v Padavatbon(1969)1 WLR
a t pl07 per Lord Wright.
328
cf. Jfe£gittv.Merritt(l970) 2 A l l E R
76O.
The danger perceived i s t h a t of overburdening the l e g a l system.
50
1891 3 Ch 82.
P T 0
57
^
59
estopped from denying the t r u t h of something he has s a i d . '
Kay, L J, considering
P i g g o t t V S t r a t t o n (ante) which was c i t e d f o r the p l a i n t i f f declared i t t o be 'a clear
case of estoppel.' :j^r f a i l t o see how i t can be w i t h i n Bowen, L J's statement,
and,
bearing i n mind Bowen's p o s i t i o n i n the Birmingham case^^ i t i s clear t h a t i n t h i s
l a t e r statement h i s mind was addressed t o the common law doctrine of estoppel on the
one hand, and Derry v Peek on the other,
[ i n n e i t h e r Chadwick v Manning^'fnor Lala Beni Ram & Another v Kundan L a l l e t a l ^ ^ were
the Hughes cases c i t e d or discussed. A representation o f i n t e n t i o n was held t o place
the defendant under no l i a b i l i t y i n the f i r s t case. I n the second, f i v e tenants took a
lease from a banker of a piece of land f o r the purpose of operating a s a l t p e t r e f a c t o r y
thereon.- The appellants acquired the land from the bankers, thus becoming the landlords,
and f a i r l y soon a f t e r t h i s the s a l t p e t r e manufacture was discontinued, several
structures i n c l u d i n g a temple being b u i l t on the land instead. More than t h i r t y years
i f t e r acquiring the land the appellant lessors served a notice to q u i t and to remove
•jhe b u i l d i n g s from the land. The tenants appealed from an unfavourable decision by the
Munsiff o f Hathras, to the Subordinate Judge o f A l i g a r h , who found i n t h e i r favour.'...the
evidence,' he s a i d , 'shews i n the most unmistakeable manner t h a t not only d i d the
o r i g i n a l lessees (lessor, presumably) not object to the enclosing of these buildings
v'hen they were being erected, and stood by, but t h a t by continuing to receive the rents
j'rom the lessees even a f t e r the e r e c t i o n of the b u i l d i n g s , and even though the
s a l t p e t r e f a c t o r y f o r which the land was l e t had ceased to e x i s t he sanctioned the
lessees' doing so. His successors are therefore equitably estopped from now suing f o r
5"ootnotess
59
At pl05.
60
See h i s remarks i n Bentsen v Taylor (1893 )2 QB 283: 'Did the defendants by t h e i r
acts or conduct lead the p l a i n t i f f reasonably t o support t h a t they d i d not intend
to t r e a t the contract f o r the f u t u r e as a t an end on account o f h i s f a i l u r e to
perform the c o n d i t i o n precedent' (the enphasis being mine )•
61
1896 AC 231. See also perhaps, Cooke v Ingram (1893) 68LT 67I.
6i2
LR X i v i lA 58
(1899).
P T 0
58
^
63
the lessees' ejectment.'
I n support o f h i s contention, the subordinate Judge, upheld:
i n the High Court a t Allahabad,
c i t e d Gopi v Basheshwar^^ I n t e r e s t i n g l y the judges i n
I n d i a connect equitable estoppel, which resembles what we have seen o f equitable
promise-enforcement i n the Hammersley v De B i e l cases, w i t h a Dilwyn v LlewellynRamsden v Dyson s i t u a t i o n . The J u d i c i a l Committee does not share t h i s view. The
judgement read by Lord Watson regrets the reliance i n India upon 'the loose and inadequate
statement o f the mile o f e q u i t y reported i n Gopi v Basheshwar.'
I n s o f a r , however, as the Committee r e l i e s upon Ram^den v Dyson, i t seems misled. An
equitable remedy appears i n the Committee's view r e s t r i c t e d t o s i t u a t i o n s i n which the
owner r e f r a i n s from preventing another who i s expending money on the owner's land
•under the mistaken b e l i e f t h a t the land i s h i s own property.' The House was prepared
I i n Ramsden t o enforce a representation o f i n t e n t i o n by the l a n d l o r d t o grant a lease
to a tenant a t w i l l , i f the tenant had expended money i n reliance upon the representation.
|0n the f a c t s , however, i t was decided t h a t no such representation had been made. Neither
Ihere, nor i n the l a t e r . P r i v y Council, case o f Plimmer v I f e l l i n g t o n , which was not
considered by the Committee i n the i n s t a n t case, could the party seeking the r e l i e f
'lave reasonably believed t h a t he was the owner.
Further, ' i f such representations had been made' ( i n Ramsden) ' . . . I do not f i n d t h a t
1
the noble and learned Lord i n d i c a t e d any opinion that...they would not have been
i
s u f f i c i e n t t o show the terms o f a contract which might be enforced i n a court o f equity.'
The said learned Lord may have had the good reason f o r not so i n d i c a t i n g t h a t contract
was not i n contemplation a t the time by the court or the p a r t i e s . As w i t h Hammerslgy V
De B i e l , so w i t h Ramsden v E^rson, the decision could have been reached upon contractual
p r i n c i p l e s ' ^ but was n o t : y e t the temptation remains, t o attempt t o squeeze an
i j n f a m i l i a r remedy i n t o a f a m i l i a r form^' notwithstanding t h a t t h i s exercise u n f i t s i t
Footnotes:
63
C i t e d a t p60.
.-6k WN (1885) 100.
65°
See the d e f i n i t i o n o f consideration i n Currie v Misa Q-876 )LR Exch l53
cf Gore v Van der Lann (I967)2QB31.
6|6
See the phraseology adopted Ijy Malins, V C i n Coles v P i l k i n g t o n (I87U) LR19 Exch 17U.
He enforces an i n t e n t i o n t o make a g i f t but adopts contractual terminology.
P T0
59
f o r i t s purpose.
I n G ¥hitechurch L t d v Cavanagh, Cavanagh supplies goods to Innox, a f i r m s u b s t a n t i a l l y
c o n t r o l l e d by Raymond, who processes them and supplies them t o the appellant company.
Innox i s indebted t o both, but only the appellant has s e c u r i t y . Cavanagh, f e a r i n g t h a t
Raymond's schemes t o repay are i n f a c t t r i c k s t o avoid or postpone repqyment, obtains
from the French courts ( i n whose j u r i s d i c t i o n both Innox and a branch of iKhitechurch
L t d are) an 'opposition' which i n e f f e c t 'lays an embargo' on the business of Innox
until lifted.
Such an i m p o s i t i o n on Whitechurch's supplier commends i t s e l f to neither Innox nor
•Hhitechurch. Raymond's proposal i s t o provide Cavanagh w i t h security by t r a n s f e r r i n g
t o hiin shares which Raymond holds i n Whitechurch Ltd. Whitechurch Ltd's secretary, one
|Wells, described as Raymond's 'instrument' c e r t i f i e d two t r a n s f e r s which were executed
by Raymond. There was l a t e r a meeting between Cavanagh and George Whitechurch, the
managing d i r e c t o r of the appellant company, a t which the l a t t e r examined the c e r t i f i e d
t r a n s f e r s and said '...these t r a n s f e r s are i n order. The secretary has, I see, c e r t i f i e d
68
bhem.»
Gavanagh l i f t e d h i s 'opposition,• having, as he thought, obtained h i s s e c u r i t y .
Unfortunately, Raymond had acted f r a u d u l e n t l y i n executing, and Wells i n c e r t i f y i n g ,
•the t r a n s f e r s . There were no shares. Nonetheless Cavanagh claimed the r i g h t to be placed
on the company's Register of Shareholders on the basis e i t h e r of the representation
made by Wells on behalf of the company, or t h a t of Whitechurch himself.
JLS t o the f i r s t , the court held t h a t a t r a n s f e r c e r t i f i c a t e i s merely a mechanism f o r
i share-dealing, and t h a t the company gives the secretary a u t h o r i t y only to acknowledge
r e c e i p t , and not t o promise t o r e g i s t e r the transferee. A secretary had been described
as a 'humble' servant o f a compaiiy whom 'no person can assume has any a u t h o r i t y to
]'epresent anything a t a l l , ' and whose statements are not 'necessarily to be accepted
69
as t r u s t w o r t h y without f u r t h e r i n q u i r y . ' Given t h i s climate, Cavanagh was u n l i k e l y t o
Footjiotes:
d7
1902 AC
117.
68
At pl29.
49
B a m e t t v South London Tramways (I887) 13 QBD
Charlesworth's Coii?)any Law 9th Ed p225.
8 l 5 at p8l7 per Lord Esher c i t e d
P T 0
60
'
70
succeed on the secretary's representation.
Even the managing Director's
representation
d i d not bind the company, e i t h e r because he had no a u t h o r i t y , or because the representatioi
' i f i t i s arQTthing...(is)...a
promise de f u t u r e , which cannot be an estoppel.'
The p o s i t i o n as t o c e r t i f i c a t i o n of t r a n s f e r s seemed curiously unsatisfactory, and i s
71
now
contained i n l e g i s l a t i o n
Lord Robertson's judgement asserted t h a t w h i l s t the
managing d i r e c t o r had no a u t h o r i t y to bind the coii¥)any by h i s representation,
secretary may
the
have had: but t h a t Cavanagh had not acted t o h i s detriment. He had merely
withdrawn h i s 'opposition' and t h i s would not have done him any good anyway. A f t e r
t
ithdrawing i t and f i n d i n g himself without shares as security f o r the loan to Raymond,
i s p o s i t i o n was exactly as i t had been before.
:t seems almost to be a matter of p o l i c y on the p a r t of the courts t o f i n d no-one
72
responsible f o r actions c a r r i e d out on behalf of a compar^y,
and t h i s may
perhaps be
through a misunderstanding of the e f f e c t of corporate personality. To concentrate on
bhe contractual r i g h t s of Cavanagh was
t o ignore the possible i n e q u i t y which might have
i r i s e n - and t o which Hughes would have provided a s o l u t i o n consistent w i t h the
qui table t r a d i t i o n .'I have sketched - had Whitechurch Ltd attempted to achieve p r i o r i t y
cjver Cavanagh as Raymond's c r e d i t o r before another s o l u t i o n , a l t e r n a t i v e t o the t r a n s f e r
f shares, had been reached, so as to give Cavanagh security.
I n contrast w i t h these cases which deny a l l e f f e c t t o representations which cannot be
anatysed c o n t r a c t u a l l y , i s another l i n e , beginning, f o r the purpose of our survey post73
'
-iJughes, w i t h Tabor v Godfrey i n 1895'
Here the p l a i n t i f f and h i s neighbours each
occupied a house i n a terrace owned by the landlord. I t was
intended by the landlord
t l a t there should be an unmetalled access road running the length of the terrace
and
j aining the p u b l i c highway a t both ends. P l a i n t i f f ' s lease included a small garden and
Fpotnotes:
7 3
See
71
See now
7;?
For a s l i g h t l y more j u s t i f i a b l e r e f u s a l to estop a company from denying t i t l e
Guy
7i
on t h i s , the l a t e r case of Ruben v Great F i n g a l l Consolidated(1906 )AC li39.
Coii?)anies Act 19U8
s 79.
see
vWaterlow (1909) 25TLR515
(1895) 6U LJQB 2ii5.
P T 0
61
a r i g h t o f way w i t h the other tenants, over the access road. I n f a c t , h i s garden was
so extended as t o encroach upon the access road, bisecting i t , since h i s house was i n
the middle of the row, 'and, although the lease excludes i t , y e t by the way-in which
the l a n d l o r d has permitted him t o occupy the encroachments ( i t ) must be taken as
7l
included i n the demise.'
The l a n d l o r d had by h i s acquiescence represented that he
jwould not exercise h i s l e g a l r i g h t s t o e j e c t the tenant and was prevented from suing
e i t h e r f o r an i n j u n c t i o n or damages f o r trespass. Consideration was not provided by the
tenant so as t o b r i n g the case w i t h i n the pale of contract,. and there does not appear
to be a question o f adverse possession, although the period exceeded twelve years,
75
since the p l a i n t i f f d i d not occupy the land s o l e l y f o r h i s own b e n e f i t !
Fenner v HLake
concerns a tenant from year t o year o f a Lady Day holding who wished,
i n December, t o surrender w i t h e f f e c t from midsummer. The surrender was accepted by the
Landlord, who then, i n r e l i a n c e upon i t sold the property w i t h possession from midsummer. The tenant was estopped from d i s p u t i n g t h a t he d i d not hold under the new
agreement. Being o r a l , t h i s agreement contravened the Statute of Frauds. "iWhat d i d the
ienant represent? He cannot have asserted the v a l i d i t y of the agreement i n the face of
S'ootnotess
Per Charles, J. .
'l^
According w i t h the s o l u t i o n proposed by Goodman: Adverse possession of land M o r a l i t y & Motive 33MI<R 281 a t p283i t o the anomaly t h a t a tenant who encroaches
on h i s landlord's land does not acquire the fee simple, except t h a t the consent
here i s i m p l i e d and not express. There would be no p o i n t i n awarding the tenant
here so small a p l o t of land i n fee simple; indeed i f one assesses the u t i l i t y
o f adverse possession i n terms of maximising land use, the doctrine would have a
malign i n f l u e n c e and thus a counter-productive a p p l i c a t i o n t o Tabor v Godfrey.
c f on adverse possession by the tenant not r a i s i n g a presumption t h a t i t forms a
p a r t of the tenancy, Hastings v Saddler(l898)79Kr
355
(tenant of St Mary's Island,
Northumberland occupying gardens on mainland belonging to the l a n d l o r d ) .
76
1900 IQB
1;26.
P T 0
62
77
the Statute, f o r a representation of law does not found an estoppel! Nor can he have
represented as f a c t t h a t the new lease by operation of law replaced the o r i g i n a l one,
surely, i f t h i s operation of law i s based upon the tenant's being estopped: f o r what
then bases the estoppel? The b e t t e r view, i s t h a t he represented h i s i n t e n t i o n to
leave i n midsummer, and not t o r e l y upon h i s s t r i c t l e g a l r i g h t s under the o r i g i n a l
lease. I n other wards the court i s g i v i n g e f f e c t t o the equity.
I n May V B e l l e v i l l e
an e q u i t y i s enforced against a purchaser. Two properties, one
tenanted, one owned by a vendor who s e l l s one and r e t a i n s the tenanted one. He s e l l s
subject t o r i g h t s of way enjoyed over i t by the tenants of the retained property, but
the
conveyance i s not executed. The defendant, as successor i n t i t l e of the purchaser
under the conveyance containing the r i g h t s cannot i n s i s t on h i s s t r i c t l e g a l r i g h t s
and avoid the r i g h t s of way: the purchaser was put upon i n q u i r y concerning the r i g h t s
r e f e r r e d t o i n the conveyance, and thus so was the successor. She must therefore be
tield t o have had constructive n o t i c e l ^
Two years l a t e r the waiver p r i n c i p l e i s extended t o a case i n which the promissor has
80
no a u t h o r i t y t o waive r i g h t s .
A husband on separating from h i s wife subscribed t o a
deed p r o v i d i n g f o r payment by him t o a trustee on behalf of the w i f e , and allowing the
musband, a f t e r twelve months, t o give notice t o the trustee to pay a reduced sum. I n
i'act he n o t i f i e d h i s wife's s o l i c i t o r s t h a t he could no longer pay, and the wife waived
the
c o n d i t i o n o f n o t i c e t o the t r u s t e e . The court held t h a t the waiver operates t o bind
•the w i f e so t h a t she may not i n s i s t on receiving payments, nor can she sue f o r the
arrears, f o r by f a i l i n g t o not give notice t o the trustee the husband had acted t o
t i s detriment.
A case i n which a licence t o occupy was i n e f f e c t converted i s A-G
f o r the Prince of
l a l e s V Collctn.-.;.,^ The defendant's gradfather owned land i n Cornwall i n which the Duchy
Footnotes:
7|7
Spencer-Bower & Turner p36, and the cases c i t e d . See Creswell v Jeffreys (1912)
i
28TLRU.
78
7?
1905 2 Ch 605.
Having been exercised by the tenants f o r 35 years, they were s u f f i c i e n t l y defined.
80
Macnaghton v Paterson(1907)AC U83.
81
1916 2KB193.
p
Q
^3
of Cornwall owned the mineral r i g h t s . He occupied a house b u i l t i n connexion w i t h c e r t a i n
mining operations on h i s land, and the defendant occupied i t a f t e r him, spending large
sums so as t o convert and eialarge i t . The a l t e r a t i o n s were known t o l o c a l agents o f
[the Duchy o f Cornwall who made no move t o i n t e r f e r e , and as a r e s u l t the Duchy was
1
estopped from asserting t i t l e t o the b u i l d i n g s .
Three cases f o l l o w which do not r e l a t e t o land, but extend the Hughes p r i n c i p l e and
i l l u s t r a t e the use o f equity t o r e s t r a i n l e g a l r i g h t s . Lord Reading, L J i n Panoutsos
V Raymond Hadley Corpn o f New York^^ found an implied waiver on the p a r t o f a s e l l e r
who accepted payment, f o r the shipment o f f l o u r , by unconfirmed banker's c r e d i t though
the
contract s t i p u l a t e d a confirmed banker's c r e d i t . I t was not u n t i l the s e l l e r found
i t d i f f i c u l t t o perform the contract - he had requested an extension o f time f o r a
P-ater shipment - t h a t he sought t o escape from h i s obligations, as a s t r i c t l e g a l
interpretation
o f the contract would have allowed, t y pointing out the buyer's
f a i l u r e t o open a confirmed c r e d i t . I t was h e l d t h a t reasonable notice must be given
before the s t r i c t terms o f the contract could be complied w i t h , i n order t o give the
I
)3uyer time t o comply. The waiver amounted, i n short, t o a representation that the
seller d i d not i n t e n d t o r e l y on t h i s p a r t i c u l a r term o f the contract, a t least u n t i l
j j f t e r reasonable notice o f a contrary i n t e n t i o n ,
ji'ootnotes:
02
1917 2KBI473. See also The l f i y ( l 9 7 ^
^3
78.
I assume a d i s t i n c t i o n between law and equity which does not e x i s t . Perhaps a
b e t t e r expression o f the d i s t i n c t i o n would be 'formal' as against ' e t h i c a l , ' but
i f i t i s borne i n mind t h a t t h i s i s what i s meant a terminological departure from
f a i t d l i a r shorthand usage may be avoided. The I873 reforms meant t h a t Law and Equity
ceased t o have separate i d e n t i t i e s . The j u r i s d i c t i o n o f the Chancellor insofar as
t h i s r e l a t e d t o the p o s i t i v e concepts necessitated t y Equity's negative r e s t r a i n t
upon the exercise o f the common law r i g h t s passed f o r the most p a r t t o the
Chancery D i v i s i o n , but i n s e r t i o n i n t o formal law o f an e t h i c a l component i s now
the
task f o r a l l courts, and i t i s hoped t h a t use o f 'equity' does not r e s u l t i n
'bewitching' e i t h e r iryself or others.
P T0
6k
I
n Ayrey v B r i t i s h Legal and United Provident Assurance Co^^ a wife sued as executrix .
er husband had taken out a l i f e p o l i c y w i t h the defendant, and had described himself
n the proposal form as a fisherman. The degree of r i s k was greater i n f a c t , because
.e was also a member of the Navy Reserve. He had t o l d the l o c a l manager of t h i s , and
t
he manager had continued t o accept premiums u n t i l 19l6, when the husband was drowned,
he suggestion t h a t the contract was v a r i e d , the assured having submitted a new. o f f e r
3n new terms subsequently accepted when the manager received the next premium was
|i'ejected, since the manager had no a u t h o r i t y to make contracts on behalf of the compai^,
f but i t i s not necessary i n order t o hold the company l i a b l e t o the p l a i n t i f f t o regard
OH
i;he
d i s t r i c t manager as having made a new contract,'
Vfhether
instead 'the...question...is
the company l e d the p l a i n t i f f t o believe t h a t they d i d not intenii t o t r e a t the
86
<; o n t r a c t as a t an end.'
The company was l i a b l e i n the absence of a contract because
v i t h the knowledge imputed t o i t through i t s agent i t continued t o accept premiums, and
could not t h e r e f o r e r e l y upon the s t r i c t terms of the contract.
I t i s sometimes
88
assumed t h a t the Hughes p r i n c i p l e , being suspensory, must also be teroporary. Clearly,
m the nature of Ayrey's case the remedy must be longer l a s t i n g .
89
I n Craine v C o l o n i a l Mutual F i r e Insurance Co
I t was a-term of the Insured's contract
o|,insurance t h a t he should n o t i f y the company, w i t h i n f i f t e e n days of the occurrence
O i l a f i r e , of the p a r t i c u l a r s of h i s l o s s . Failure could v i t i a t e the p o l i c y . A f u r t h e r
t^rm
provided t h a t i f the claim were not adjusted the company could take possession
of. the fire-damaged property, but w i t h o u t I n c u r r i n g any l i a b i l i t y . The Insured provided
d e t a i l s of h i s l o s s outside the f i f t e e n day period and was asked t o reimburse them
bocause the f i r s t documents were not i n order. The company went i n t o possession of the
property and negotiations took place between the insured and the company. Ultimately the
Footnotes:
81.
1918 I K B I 3 6 . ( D i v i s i o n a l Court).
85
Per Lawrence, J pli;0.
i
84
Per A t k l n , J a t pli;2.
8^
I f the agent had gained the knowledge w h i l s t helping the assured t o f i l l i n the
proposal form i t would not have been j^iptted t o the company: Newsholme v Road
Transport General Insurance (1929 )gKB 356.
88
See, f o r example, the a r t i c l e s t y Professor Wilson, c i t e d e a r l i e r .
89
(1920) 28CLR305. On appeal from the High Court of A u s t r a l i a , (1922)AC ShX, sub nom
Yorkshire Insurance Co v Craine.
P T 0
6^
conpany refused t o accept l i a b i l i - t y vjider the policy. The High Court of A u s t r a l i a
d i f f e r e n t i a t e d between a pure statement o f i n t e n t i o n which i t considered would not be
binding, and a statement o f present i n t e n t i o n together w i t h a present act, which would
s u f f i c e t o estop the company from denying l i a b i l i t y .
On appeal, the J u d i c i a l Committee f e l t t h a t by taking possession the company had
s i g n a l l e d not a present i n t e n t i o n ' b u t a f a c t , namely t h a t the claim was recognised as
v a l i d and t h a t a l l t h a t remained uncertain was the amount payable. I t was f e l t safer
to r e l y upon t h i s representation than upon the one made a t the time when the company
•returned the p a r t i c u l a r s o f claim w i t h an i n v i t a t i o n t o resubmit corrected p a r t i c u l a r s ,
even though the o r i g i n a l submission was l a t e : t h i s was seen by the Committee as, i f
anything, a representation o f an i n t e n t i o n t o consider the claim. Their Lordships .
iecided t h a t such a representation would not bind the company, and thus r e l i e d upon
bhe company's occupation t o estop i t from denying having accepted l i a b i l i t y ,
irhe
committee's analysis i s scarcely more s a t i s f a c t o r y than t h a t of the High Court o f
A u s t r a l i a . I n t h e i r e f f o r t t o avoid binding the company by a representation of i n t e n t i o n
the
l a t t e r invented a d i s t i n c t i o n which admits t h a t statements o f f a c t may derive t h e i r
^bstance and form from the extent t o which they indicate an i n t e n t i o n about the f u t u r e ,
and t h a t any attempt t o divide the l e g a l e f f e c t of a statenrant of f a c t from t h a t o f a
statement o f i n t e n t i o n and a t the same time reconcile law and r e a l i t y sinks one i n t o
90
a! quagmire of semantics.
The former body seems t o have been driven t o abandon the
Flootnotess
9|D
See Spiers v McCully (1925) NZLR 385. Builder contracts f o r the supply o f materials.
The supplier, aware o f the b u i l d e r ' s shaky finances, asked the owner o f the
p o t e n t i a l house t o guarantee payment: he d i d so, the house was b u i l t and on being
passed by the owners the supplier sent a b i l l f o r £92. The owner then s e t t l e d w i t h
the
b u i l d e r , who duly became bankrupt. The supplier sent a fresh b i l l t o the owner.
The High Court o f New Zealand held t h a t the supplier was estopped, having submitted
one b i l l , from accepting t h a t i t was normal practice t o submit a separate b i l l f o r
j o i n e r y . ¥as t h i s a representation o f f a c t t h a t the account was settled? I f so,
does t h i s state of a f f a i r s not derive i t s substance from the i n t e n t i o n which i t
i m p l i e s not t o submit f r e s h b i l l s ?
P T 0
66
c l a s s i c a l dogma t h a t the court should give e f f e c t t o the i n t e n t i o n o f the p a r t i e s : a
term of the cpntract provided f o r occupation o f the insured's premises by the insurer
without the l a t t e r i n c u r r i n g l i a b i l i t y .
91
The p l a i n t i f f i n Bums v Dilviorth Trustee Board
sought a perpetual i n j u n c t i o n t o
prevent the defendant from using land other than as a r e c r e a t i o n a l area. The defendant
had shewn on a plan an i n t e n t i o n to use 23 acres of land w i t h i n the c i t y of Auckland
as a 'recreational reserve,' and i t was i n reliance upon t h i s t h a t the holders o f
nearby l o t s had taken leases from him. The designation was a statement o f f a c t , but
t h i s was meaningless without an i n t e n t i o n t h a t the area should continue to be reserved
f o r t h i s purpose y e t 'The r i g h t o f a lessee t o r e s t r a i n an owner from departing from
92
h i s plan i s based e i t h e r upon an implied contract or upon estoppel by representation.
P l a i n t i f f succeeded.
These two cases may be contrasted w i t h what seems conceptually a 'half-way case's
93
[Metcalfe v Boyce.
A policeman became the q u a r t e r l y tenant of a house, and received a
grant t o a s s i s t w i t h payment of the r e n t . I n 1912 the police a u t h o r i t y , Somerset County
jCouncil, decided t h a t the Chief Constable should become the tenant, and t h a t constables
should occupy houses as servants of h i s instead o f as tenants on t h e i r own account.
Thereafter no r a t e demands were sent t o the defendant. Demands f o r rent he took t o the
Police O f f i c e from whom he received the sums payable and duly handed them to the estate
o f f i c e of h i s l a n d l o r d . No w r i t t e n assignment was made, but the landlord knew o f the
("ootnotess
;?1
1925 NZLR i|.88 - a case a r i s i n g out o f the Torrens system of r e g i s t r a t i o n . See also
Bank o f New Zealand v D i s t r i c t Land Registrar 27 NZffi 126. Also Dabbs v Seaman
(1925)36 CLR538. P l a i n t i f f claimed t h a t the plan, together w i t h the words on a
t r a n s f e r o f land t o him by the defendant's predecessor i n t i t l e amounted t o a
representation t h a t she had a r i g h t of way. Held, i n t e r a l i a , (Higgins J
d i s s e n t i n g ) t h a t p l a i n t i f f had been misled, not by a statement o f f a c t since the
way was impassable, but by a statement of f u t u r e i n t e n t i o n t o provide a way.
^2
Per Reed, J a t p5o5j P i g g o t t v S t r a t t o n c i t e d .
93
1927 1KB758.
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67
change, and i t was h e l d that the constable was estopped from denying i t . Thus 'the
plaintiff
can r e l y upon a surrender or assignment t y act or operation o f law s u f f i c i e n t
9li
to s a t i s f y the Statute of Frauds.'
The case i s an i l l u s t r a t i o n of the 'minesweeper' p r i n c i p l e : the Chief Constable asserts
t h a t the a t t r i b u t e s of tenancy belong t o him and seeks t o exercise them against the
defendant. The l a t t e r i s estopped from s e t t i n g up as a defense t h a t he i s the tenant.
I t i s not the 'Cause of a c t i o n which i s provided by the estoppel but merely the means
of acheiving success. Metcalfe v Bo:^pce i s a 'halfway' case because although the estoppel
95
arises from a statement
of f a c t , t h i s statement derives i t s substance from an
96
operation of law.
The surrender i s not e f f e c t e d by w r i t i n g , and, as McKinnon indicates,
s a t i s f i e s the Statute of Frauds by reason of the performance of the p a r t i e s . Conventional
analysis, using a shorthand terminology masks the r e a l nature of what has happened,
which i s t h a t the tenant has stated t h a t he w i l l i n the f u t u r e no longer claim the
a t t r i b u t e s of tenancy. Both p a r t i e s act i n reliance upon t h a t state of a f f a i r s , based
on a statement of i n t e n t i o n .
There i s nothing t o prevent the courts from allowing a statement of i n t e n t i o n to base
an estoppel i n one circumstance - f o r example where a surrender or assignment i s deemed
97
by operation of law - but semantic confusion should not prevent recognition o f r e a l i t y ,
98
although i t seems t o have done so. I n Canadian P a c i f i c Railway v R
the J u d i c i a l
Footnotes:
9h
Per McKinnon, J a t p76ii . The Judge f e l t t h a t the pleadings i n e f f e c t asserted
an estoppel on the defendant's p a r t , though they d i d not say so.
95
Using 'Statement' widely so as t o include conduct amounting t o acquiescence.
96
See Cheshire. Modern Real Property 9th Ed pU38-9.
97
See also, perhaps, Rodenhurst Estates vW
H Barnes Ltd(l936) 2 A l l E R 3: agreement
f o r an assignment operating t o prevent the assignee from denying l i a b i l i t y to pay
r e n t t o the l a n d l o r d , who had consented t o the assignment. The agreement to assign
i s binding i n the same way as a contract - i t evidences a binding i n t e n t i o n t o
9Q
create a s i t u a t i o n which would be achieved by a deed.
1931 AC lahP T 0
68
Committee stated t h a t 'the foundation upon which reposes the r i g h t of equity to
intervene i s e i t h e r contract, or the existence of some f a c t which the l e g a l owner i s
99
estopped from denying.' Lord Tomlin's d e f i n i t i o n two years l a t e r
presents estoppel
as a representation, or conduct amounting t o a representation^^*^ intended, t o induce,
and i n f a c t inducing a course of a c t i o n on the p a r t of the representees the two kinds
o f representation are not distinguished. Four years a f t e r t h a t , i n 1937 Simraonds, J
gave e f f e c t t o a promise concerning f u t u r e conduct, though without mentioning the
doctrine of estoppel'!"'^"'"
'
10?
Re W i l l i a m Ebrter L t d
involved a company the governing d i r e c t o r (one Fontannaz) of
which secured a r e s o l u t i o n t h a t no fees were t o be paid t o the d i r e c t o r s from f i r s t
October 1933 u n t i l the company was i n b e t t e r f i n a n c i a l circumstances, when a contrary
r e s o l u t i o n might be passed. For t h i s forebearance on the part of the d i r e c t o r s there
I was no consideration but 'the r e s o l u t i o n was intended t o induce the company to take a
c e r t a i n coiirse of a c t i o n . . . ( i t ) was not an act of benevolence... (but was).. .intended
to induce the compaxiy t o enter transactions and to incur obligations which, but f o r
that r e s o l u t i o n i t might not have done.' Following Fontannaz's bankruptcy the company
resolved t o go i n t o l i q u i d a t i o n . Fontannaz's trustee i n bankruptcy sought to prove f o r
the fees foregone by him a f t e r the date of the r e s o l u t i o n , but he was unable t o do so.
The reasoning seems more i n l i n e w i t h the dictum i n Greenwood v Martin's Bank than
d t h t h a t o f CPR v R.
m more c l e a r l y , i n Salisbury v Gilmore]"'^-^ the court found f o r a tenant who had
l e l i e d upon a representation by h i s l a n d l o r d t h a t a t the termination of the tenancy the
premises would be demolished. As a r e s u l t the tenant had not complied w i t h the covenant
Footnotess
99
I n Greenwood v Martin's Bank(l933)AG5l a t p57.
100
The curious argument was raised t h a t the silence o f the husband might not found
an estoppel against him. The e f f o r t s t o r e s t r i c t the doctrine seem t o r e l y a t times
on f l i m s y and i r r a t i o n a l pretexts.
10]j The d i r e c t o r s ' a c t i o n i s classed as 'a waiver of claims'.
132
(1937) 2 A l l S R 361.
ip3 <19ii2) 2KB 39.
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to r e p a i r contained i n h i s lease Section 18 o f the Landlord and Tenant Act 1927 allows
damages f o r such a breach, equal t o the diminution i f any i n the value of the reversion.
Damages are not recoverable where the r e p a i r s would be made valueless hy reason of
s t r u c t u r a l a l t e r a t i o n s or, of course, demolition'l"^^ Here the l a n d l o r d had changed h i s
|mind about demolition because o f the outbreak of war, so t h a t the repairs d i d i n f a c t
a f f e c t the reversion's value. Cousel f o r the tenant. Denning K C, urged the Hughes
p r i n c i p l e upon the court. Goddard, L J found the case 'of great s i i i ? ) l i c i t y ' and f e l t
t 'unnecessary t o consider many of the i n t e r e s t i n g matters t h a t were discussed before
105
us' i n f i n d i n g i n favour of the tenant. MacKinnon, L J alone oiscussed the dictum of
Bowen, L J i n Birmingham, and distinguished the supposed Jorden v Money p r i n c i p l e . He
recognised t h a t case as binding, but d i d not t h i n k t h a t i t 'avails t o prevent the
tenant from r e l y i n g on the p r i n c i p l e stated by Bowen, L J.. .merely because.. .the word
^ ' i n t e n t i o n ' ' was used. Again the a r t i f i c i a l i t y of the d i s t i n c t i o n was raised. ' I f one
says ' I am growing o l d and .-dQ
not intend t o l i v e long' ,' MacKinnon reasoned, ' i n
'orm one states an i n t e n t i o n , i n substance one states a melancholy f a c t .
he analogy w i t h the condition of m o r t a l i t y i s not p a r t i c u l a r l y apposite, though of
ciourse the dysfunctional nature of the semantic argument i s i l l u s t r a t e d . Clearly the
court was r e q u i r i n g the l a n d l o r d t o stand by h i s representation of i n t e n t i o n once the
tenant had r e l i e d upon i t . Neither the l a n d l o r d nore the tenant can have understood by
the
landlprd's representation t h a t i t was i n substance a comment upon the i n e v i t a b i l i t y
of a demolition a t the hands of the l a n d l o r d , or that i t was merely a statement of f a c t
about the landlord's state of mind a t a p o i n t i n h i s t o r y w i t h no implications f o r the
future.
Footnotes:
ibU
See Gibson's Conveyancing 19th Ed p398-9.
105
The t h i r d judge. Lord Greene, M R found f o r the defendant on other grounds.
1,06
A statements ' I am growing o l d and intend t o commit suicide' would be more useful.
Following the t r a d i t i o n a l i n t e r p r e t a t i o n o f Jordan's Case, reliance upon
t h i s would not defeat an a c t i o n by the maker of the statement against a promissee
who had acted t o h i s detriment. Following Salisbury v Gilmore, surely a d i f f e r e n t
conclusion would be reached. But perhaps public p o l i c y would intervene.
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70
107
I n I9I46,
Humphreys, J gave e f f e c t t o a promise made hy a l a n d l o r d t o accept a lower
r e n t by preventing him from having the arrears. The tenant, who ran a dancing school
i n the premises, i n d i c a t e d t o the l a n d l o r d t h a t , since wartime conditions prevented her
from continuing t o do so, e i t h e r he must accept a lower r e n t , or she must go. He
accepted her o f f e r o f one h a l f o f the amount provided f o r i n the lease, and she over
time paid, q u i t e v o l u n t a r i l y , more, u n t i l the o r i g i n a l r e n t l e v e l was attained. The
court viewed the case as one o f estoppel. Again the representation was i n essence a
statement o f f u t u r e i n t e n t i o n .
Two Commonwealth cases, Svenson v Payne
and Canadian & Dominion Sugar Corporation v
I09
Canadian National S S Lines
en^shasise the need f o r 'precise and unambiguous' language
on which t o found an estoppel. The l a t t e r case, appealed t o the J u d i c i a l Committee,
contains a statement stressing the a p p l i c a t i o n t o estoppels o f common law p r i n c i p l e s .
Neither, on the f a c t s , j u s t i f i e s the i n t e r v e n t i o n of equity t o r e s t r a i n the exercise o f
l e g a l r i g h t s , and since the promissee was i n both cases unsuccessful they are merely
negative
authorityP"^
Footnotes:
107
108
Buttery v Pickard(l9ii6)M52.
, (I9i;5) 71CLR531.
109
(l9i;7MC U6.
LIO ,,In Svenson a tenant f o r l i f e granted a lease. The remainderman d i d not r e a l i s e t h a t
she had any present remedy. However, on the t e n a n t - f o r - l i f e ' s death she applied f o r
equitable r e l i e f , overcoming an alleged estoppel based on her previous i n a c t i v i t y . I t
was held not t o be unreasonable t h a t she had not done anything e a r l i e r because, i n t e r
a l i a , the tenant f o r l i f e was a t the time o f the grant healthy w i t h a 'considerable'
l i f e expectancy. From the remainderman's p o i n t o f view i t was reasonable t o suppose
e i t h e r t h a t he was prepared t o take the r i s k o f the tenant's e a r l y death, or t h a t he
had insured against such r i s k . I t was on the evidence o f the tense t h a t the court
• decided not t o exercise i t s d i s c r e t i o n under the Eamsden v Dyson p r i n c i p l e .
S i m i l a r l y Canadian & Dominion Sugar formed on the evidences the appellants f a i l e d t o
convince the J u d i c i a l Committee t h a t the respondent had made an-'unqualified
statement' as t o the good order o f the sugar on i t s r e c e i p t on board ship.
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Before considering the High Trees case, i t seems appropriate t o make some concluding
remarks about the e a r l i e r cases; the extent t o which Denning J r a d i c a l l y a l t e r e d the
e x i s t i n g law may then be apparent.
I s h a l l i n the next chapter suggest the necessity f o r redrawing the boundaries of l e g a l
categories, depending upon the purposes of the c l a s s i f i c a t i o n . Already i t i s clear
t h a t the c l a r i t y o f the p r i n c i p l e t h a t equity w i l l r e s t r a i n the exercise of l e g a l r i g h t s
s u f f e r s or p r e v a i l s , not always according to the merits of the case, but according t o
the category i n t o which f o r other purposes, a case f i t s . Companies enjoy an astonishing
immunity from r e s p o n s i b i l i t y , f o r example, a t the hands of the j u d i c i a r y .
) f the two l i n e s o f a u t h o r i t y that we suggested emerged from the 1875 l e g i s l a t i o n , the
Line r e f l e c t i n g the common law view of estoppel and promise-enforcement enjoys exclusive
attention a t f i r s t . The Hughes and Birmingham cases are consigned t o t o t a l obscurity
i n t i l rescued by Denning as counsel f o r the defendant i n Salisbury v Gilmore (ante). Only
•the climate o f TJttar Pradesh seems t o have stimulated j u d i c i a l imagination s u f f i c i e n t l y
•io see a u s e f u l connexion between Hammersley v De B i e l (ante) and Dilwyn v Llewellyn.
I n c r i t i c i s i n g the conclusion o f the judges i n Lala Beni Ram's Case, the J u d i c i a l
Committee seem, as we have submitted, t o have misunderstood Dilwyn v Llewellyn. Not
u n t i l almost the t u r n of the century i s the p o s s i b i l i t y of a non-contractual o b l i g a t i o n
lecogniseds and even a f t e r t h i s e f f o r t s are made t o adjust r e a l i t y so as t o support a
lonclusion t h a t representations ,of i n t e n t i o n do not create l i a b i l i t y . Following Tabor y
Godfrey r e c o g n i t i o n of claims against promissors are h a l t i n g l y met, but w i t h no consistent
a s s e r t i o n of a p r i n c i p l e .
The achievement of Denning, J i n Central London Property Trust L t d v High Trees House
L[td"^^ was i n h i s r e c o g n i t i o n t h a t a connexion e x i s t e d between the o l d cases of Ikghes
a i d Birmingham, and the then recent cases of Re W i l l i a m Porter and Salisbury v Gilmore.
I ideed, the judgement must r e l y f o r i t s a u t h o r i t y upon the general r u l e established -
t i o u g h scarcely always consciously - i n these previous decisions, f o r the stateinent of
Fjaotnotess
ILl
19i;7 KB
130.
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72
4
•J
law r e l i e d upon subsequently, and a t t r i b u t e d t o the case by the leading t e x t - w r i t e r s ,
112
was o b i t e r .
The f a c t s of the case are too w e l l known to warrant d e t a i l e d rehearsal,
but b r i e f l y , a block of f l a t s was l e t by the lessor company t o a subsidiary company,
the defendant, i n 1937. Before the block was f u l l y tenanted, wartime made l e t t i n g
l i f f L c u l t and as a r e s u l t the defendants were unable t o pay the agreed rent from t h e i r
p r o f i t s . Following discussion w i t h the p l a i n t i f f lessors the rent was reduced by h a l f ,
ijhich sum was p a i d u n t i l 19i;5. I n t h a t year p l a i n t i f f company's receiver, who had been
appointed i n 19hl, discovered the arrangement, concluded, perhaps, that i t was not
l e g a l l y binding, and claimed the f u l l r e n t , together w i t h the arrears. The
proceedings
:Ln the High Court were i n the nature of a t e s t case, i n which p l a i n t i f f claimed arrears
only i n respect of the l a s t two quarters of 19ii5. Since the e n t i r e block was l e t at
lihis time i t was c l e a r t h a t the r a i s o n d'etre of the arrangement was gone, and the
p l a i n t i f f succeeded i n h i s a c t i o n .
Ilqually c l e a r was Denning J's a r t i c u l a t i o n of the p r i n c i p l e according t o which the
promise could be enforced: 'a promise intended t o be binding, intended t o be acted upon
and i n f a c t acted upon, i s binding so f a r as i t s terms properly apply. ''^'^^ The cases
Which we have examined suggest that there was nothing new i n the p r i n c i p l e , but 'by...
19i|6 orthodox opinion had become so hardened i n the v|ew t h a t gratuitous promises were
n^ver enforceable and t h a t only bargains constitute contracts t h a t orthodox lawyers
cbuld not believe t h a t Denning J's d i c t a could be sound law. '"^
Footnotes:
1|.2
c f Hedley ly-me v Heller (196I4. )ACi4.65. See, i n r e l a t i o n to t h a t case the statement
by Heuston: Salmond on Tort l5th Ed p265-6. ' I t would be pedantic and absurd t o
dismiss as o b i t e r the f u l l y considered judgement of f i v e law lords delivered
a f t e r hearing eight days of argument.'
I t would seem equally absurd t o dismiss Denning J's ex tempore judgement delivered
a f t e r a much shorter hearing.
1I3
19U7 KB 130 a t PI36.•
11.U
A t i y a h : Consideration i n Contracts - a fundamental restatement 50.
73
IV
I i n d i c a t e d i n the foregoing chapters ny adoption o f the view that the law consists,
i n p a r t anyway, i n the conferment o f r e c o g n i t i o n upon claims asserted by i n d i v i d u a l s
or groups^ I t was suggested t h a t one such de f a c t o claim was t o have promises recognised
and enforced i n p a r t i c u l a r circumstances, and t h a t equity anciently went f u r t h e r i n
recognising such claims than the common law. During the nineteenth century there was
greater approximation between equity and common law, but nevertheless there emerged
a f t e r the major reforms o f iiie period two d i s t i n c t a t t i t u d e s t o the promise, and two
l i n e s o f a u t h o r i t y . That which I characterise as equitable maintained i t s t r a d i t i o n a l
r o l e as such, by r e f u s i n g the enforcement o f s t r i c t l e g a l r i g h t s contrary t o a promise
made and acted upon: I consider t h a t the eqixity maintains i t s r o l e y e t .
The claims theory of law becomes c e n t r a l when one asserts t h a t i n order t o s a t i s f y the
2
requirement of j u s t i c e , l e g a l r e c o g n i t i o n may be given i n inappropriate or inconvenient
terms so as t o avoid d o c t r i n a l c o n f l i c t s which would force the decision i n the other
direction'? We have encountered cases i n which i t seems t h a t promises have been enforced
i n a way which does not involve the court i n u n f a m i l i a r or overly adventurous
concepts,
and i n order t o impose a meaningful u n i t y upon cases J believe t o be founded upon the
'broad p r i n c i p l e o f e q u i t y ' i t i s necessary t o see whether p o l i c y or expedience allow
us t o ignore the t r a d i t i o n a l boundaries between l e g a l categories, and' t o question some
asstimptions made w i t h i n those categories'^" Legal c l a s s i f i c a t i o n takes place i n order t o
Footnotes:
L
See i n t e r a l i a Stones Social Dimensions of Law and Justice pl69 e t seq. A
u t i l i s a t i o n o f such a 'model' i s White: Lawyers and the Enforcement of Rights, i n
Social Needs & Legal A c t i o n 1973. There i s a discussion o f the j u s t i c e o f
recognising claims i n Rawls' A Theory of Justice, 1972, Chapter 1 Justice as Fairness.
I
^ t h i s i s meant the i n s t i n c t i v e r e a c t i o n i n favour o f one or other party.
)
De La Bere v Pearson(1908)lKB280 i s a good example.
t
c f Schon's Reith Lectures November 1970 i n which he argues i n favour of f u n c t i o n a l
categories. He considers t h a t , i n Government categories become most r i g i d a f t e r
they have been u s e f u l . His examples include the A g r i c u l t u r a l Extension Program,
contimaed a f t e r the achievement o f enormous a g r i c u l t u r a l surpluses. For problems
i n l e g a l c l a s s i f i c a t i o n see Jolowicz (ed)s The D i v i s i o n and C l a s s i f i c a t i o n of Law.
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solve p a r t i c u l a r problems and the classes should owe t h e i r continued existences t o
t h e i r continued capacity t o solve those problems. To the extent t h a t they do not have
t h i s f u n c t i o n , lawyers should b u i l d new models, w i t h new classes. Indeed t h i s process
i s recognised, f o r example i n the class Labour Law, which embraces contract and t o r t s
as w e l l as new m a t e r i a l . Trouble r e s u l t s when the o l d classes f a i l to be s u f f i c i e n t l y
f l u i d i n t h e i r new contexts, f o r example where a t r a d i t i o n a l regard f o r freedom o f
c o n t r a c t ^ does not y i e l d t o the r e a l i t y of consumer-manufacturer r e l a t i o n s , or contracts
of employment^ F a i l u r e t o adopt new views may w e l l be r e l a t e d to the reluctance t o
denystify- the law, both being due t o 'the f a i l u r e on the p a r t of ordinary men to
r e a l i s e t h a t the forms of law and human s o c i e i y were a t bottom merely human a r t e f a c t s ,
not n a t u r a l n e c e s s i t i e s but things made t y men, and hence things that could be unmade
F.Q'otnotsst^ : '
5
See Friedraann: Law i n a Changing Society 2nd ed pll9. The Changing l o l e of
Contract. Jolowicz op c i t .
6
Americans seem more prepared t o take a f r e s h and more en?3irical look a t categories:
See Childres& S p i t z : Status i n the Law of Contract hi NlUffi 1.
Germans too, perhaps, a t a more r a r i f i e d l e v e l . See Rehbinder: Status, Contract &
the Welfare State 23 Stanford LR9iA. ' I t i s easy t o see why i n an age of many
transactions.and therefore of increasing i n t e r a c t i o n , the importance of i n t e n t i o n
and w i l l i n tiie doctrine o f l e g a l transactions i s s t e a d i l y reduced i n favour of
p r o t e c t i o n of r e l i a n c e . ' (p952). Just as f o r Tawney Religion and Capitalism
produced a unique ethos, so I venture the suggestion that the law of contract i s a
f u n c t i o n o f an entrepreneural state. I t s - e t h i c i s now obsolete. Friedmann (The
State & the Rule of Law i n a Mxed JEconony) provides an analysis of Public, or
State, p a r t i c i p a t i o n i n modern economics of the Anglo-American k i n d , and we have
r e c e n t l y seen massive i n t e r f e r e n c e i n the area of missiles, drugs and aero engines
by the s t a t ^ , contrary t o the s p i r i t of the market, which i n s p i r e d the law. I f the
i,
law i s t o be e f f e c t i v e l y i n c o n t r o l i t must recognise new developments, and I
suggest t h a t the head of 'public p o l i c y ' i s inadequate f o r t h i s purpose.
P T 0
75
7
and remade.'
H i t h e r t o , and perhaps t o an extent even now,
the o l d categories have absorbed the new
to a remarkable degree. Thus equity i s subsumed i n t e r a l i a w i t h i n the law r e l a t i n g to
r e a l property, and the law r e l a t i n g t o contracts, though t h i s i s not t o suggest that
i t has not transformed both. But w h i l s t the unique character of i n t e r e s t s i n land as
recognised i n English law imposes the need f o r a separate law of r e a l property, i t
should not be assumed t h a t the claims which shaped the law - the claims o f the
conveyancer and the claim t o the a l i e n a b i l i t y - must forever take precedence over a l l
other possible claims. S i m i l a r l y , w h i l s t common law contract embraces the theory o f
the bargain, t h i s does not argue t h a t a l l voluntarily-assumed relationships (as opposed
to r e l a t i o n s h i p s such as Lord Atkin's 'neighbour' r e l a t i o n s h i p which i s one imposed by
law) must be governed as i f there were a bargain. F i n a l l y , f o r our present purposes,
the welfare s t a t e and the mixed econoity are both concepts which involve increased and
increasing p a r t i c i p a t i o n by a d m i n i s t r a t i v e agencies i n society. This p a r t i c i p a t i o n i s
authorised by s t a t u t e s and regulations, which allow wide d i s c r e t i o n i n the cause of
f l e x i b i l i t y . Refusal t o allow such an agency t o f e t t e r i t s e l f , and s t r i c t c o n t r o l by
jmeans of the u l t r a v i r e s d o c t r i n e , are both r e c o g n i t i o n of claims t o r e s t r a i n the
a c t i v i t i e s o f offshoots of the a d m i n i s t r a t i o n f o r the public b e n e f i t . But there i s
another claim which needs t o be considered, and t h a t i s the claim t o compensation or
protection o f the misled promissee who has a l t e r e d h i s p o s i t i o n i n reliance upon a
promise made by the agency. A t t r i b u t i n g t o a contracting party knowledge of what i s
Intra v i r e s the company w i t h which he contracts, on the basis of the p o s s i b i l i t y of
Inspecting documents lodged a t Companies House, may be r a t i o n a l - although the Jenkins
p.
_
-
FootaoteSS • 1
-
; -
.
.
~
-
.
.
.•
r
^. . •• Hart: • Bentham & the D e m y s t i f i c a t i o n o f the Law.-36 MLR2. Also much confusion
doubtless r e s u l t s from the lawyer's technique of adapting an o l d word t o f i t a
new
^
concept so t h a t i t c a r r i e s much of i t s former meaning w i t h i t .
See Westminster Corpn v Lever Finance ( l a t e r ) ; Robertson v Min of Pensions ( l a t e r ) .
P T 0
76
q
Committee doubted i t : pretending t h a t an i n d i v i d u a l has notice of the precise powers
o f a c e n t r a l or l o c a l government body i s u n r e a l i s t i c and unjust, by reason of the
volume of p r i n c i p a l and delegated l e g i s l a t i o n and the areas of d i s c r e t i o n , what i s
accomplished i s the reverse of what i s sought; a charter i s given t o such bodies to
act i r r e s p o n s i b l y and to stand on the creating instrument as a defence.
I n the f o l l o w i n g survey of the post-High Trees cases, then, I s h a l l not divide the
cases t r a d i t i o n a l l y according t o t h e i r subject matter, but instead attiempt t o see how
they f i t i n t o the p a t t e r n o f the 'broad p r i n c i p l e of equity.' Clearly we have to consider
whether the area of law i n question requires special treatment, on the f a c t s , where
special reference i s made, f o r example t o the need f o r consideration, t o the policy
t h a t land should be alienable without equitable .fetters unforseen i n 1925^ or to the
necessity f o r r e s t r a i n i n g administrative agencies, I s h a l l attempt t o assess such
reference on i t s m e r i t .
The e a r l y cases o f t e n show Denning, J c a r e f u l l y nurturing the p r i n c i p l e 'with proper
•parental concern,'"^"^ avoiding
stretcluing i t
'too far.'•'""'• A r e s u l t of an English
12
•tendency noted, i n t e r a l i a , by Abel"Smith and Stevens
t o s e t t l e 'many things..by
custom and convention. ..iwhich i n other countries would be s e t t l e d by some enactment
or j u d i c i a l d e c i s i o n ' has been t h a t noticed by Blom-Cooper and Drewrjy, i n t h e i r study
'
Report o f the Company Law Committee Cmnd 17ii9 (1962). Paras 35-ii2 c f the suggestion
Tootnotes:
(Megarry & Wade 2nd Sd pl067) t h a t ' i t i s unreasonable to allow a purchaser t o
purchase over an equitable owner... i n possession who has f a i l e d to r e g i s t e r an
estate contract.' See also Maudsley:Bona Fide Purchasers of Registered Land
36 Mm
25. Also see Laus The U l t r a Vires Doctrine & the European Communities Act
1-972. Guardian Gazette 28.3-73 a t p9. On the d i f f i c u l t i e s of s9, i n p a r t i c u l a r the
requirement t h a t the t r a n s a c t i o n sought t o be enforced must have been decided
upon by the d i r e c t o r s , see Farrar & Fowler i n 36MLR270 a t pp27l4./5.
10
Stone: Social Dimensions p26l.
11
Combe v Combe (I95l) 2KB215/220 c i t e d op c i t .
12
Lawyers and the Courts p i .
P T 0
77
13
o f the House o f Lords: the law develops slowly, u n c e r t a i n l y and i d i o s y n c r a t i c a l l y .
Foot Clinics(I9l;3) L t d v Cooper's Gowns'*^ might have eased the fears o f those who saw
Denning J's e a r l i e r decision as a voyage o f discovery. A lease given s t a t u t o r y v a l i d i t y
under the V a l i d a t i o n o f Wartime Leases Act 19i4ii which allowed e i t h e r party t o give
one month's n o t i c e i n w r i t i n g a f t e r the conclusion o f the European war, was followed
by a l e t t e r from the landlords t h a t 'so f a r as we can see a t present there i s no reason
why you should not continue t i l l the e x p i r a t i o n o f your lease i n December 19i;7 when
our own lease expires.' The landlords then gave one month's notice t o q u i t i n August
19ii6. The n o t i c e was upheld, not on tiie ground t h a t the e a r l i e r l e t t e r was i n law
incapable o f binding the landlords, but on the basis t h a t i t s terms d i d not show i t t o
be a promise intended by both sides t o be l e g a l l y binding. I n Ledingham v Bermejo
Estancia Co"^^ a loan was made t o Mie company t o enable i t t o continue i n business, and
i n t e r e s t was waived ' u n t i l such time as the conpany i s i n a p o s i t i o n t o pay.' The
|coir¥)any d i d continue i n business, but f o r twenty-two years the i n t e r e s t was unpaid"''^
u n t i l f i n a l l y t h e company went i n t o l i q u i d a t i o n . . Atkinson, J held t h a t the c r e d i t o r ' s
r i g h t s t o arrears of i n t e r e s t was extinguished, consideration had been provided, f o r
•the loan had purchased the continuance of the con?3any. Prima facia the case f i t s i n t o
the orthodox doctrine o f contracts so when the consideration f a i l e d , the arrears of
I n t e r e s t became payable. However, i f t h i s i s so i t i s d i f f i c u l t t o see why the court
:relied upon Re W i l l i a m Porter (ante) and High Trees. I n the former, Simonds J makes no
footnotes:
:|.3
F i n a l Appeal p291. Referring t o the law o f 'obligations' the authors state 'The
abiding impression o f House o f Lords decisions over the period o f study i s how
. i n f r e q u e n t l y major issues...come up f o r decision.. .the Law Lords have been starved
of work t h a t might have produced c l a r i f i c a t i o n o f the law.'
:h
(19U7)KB507.
15
(19ii7) 1 A l l E R 7ii9.
16
Although i n t e r e s t payments were c r e d i t e d t o Mrs Ager i n the company's books, and
thus presumably debited elsewhere, creating no f a l s e impression t o p o t e n t i a l ,
t h i r d - p a r t y c r e d i t o r s . I n any event, see Atkinson J's analysis o f the meaning of
the agreement a t p75lF.
P T 0
78
20
mention, i n h i s short judgement, o f consideration, and i t was the l a t t e r case which
launched
Denning, J i n t o h i s r o l e o f arche-typal heterodox.
The answer may be t h a t a l l three cases, and i n a d d i t i o n the Scottish case o f Caimcross
17
V Lorrimer,
stress the purpose o f the agreement. I n Ledingham, Atkinson, J says
18
'the
whole object o f the loan was t o enable and induce the company t o carry on.' He r e f e r s
to ffi.gh Trees, a t t r i b u t i n g t o the lessors the sentiment: 'The whole idea was t o enable
19
you t o carry on when you had empty f l a t s . '
W i l l i a m Porter L t d was ' e n t i t l e d t o assume
t h a t the d i r e c t o r s would a c t i n accordance w i t h the provisions of the resolution, they
21
had passed, and woiild n o t claim remuneration u n t i l a f u r t h e r r e s o l u t i o n was passed,'
because i t could n o t follow the purpose o f the r e s o l u t i o n without making such an
assumption. The r e s o l u t i o n would be meaningless i f i t were not binding, and t h i s i s the
reasoning permeating these cases. A party who takes advantage of such a promise must,
i n an age o f transactions, be able t o r e l y on i t , but i t i s Procrustean, not t o say
c i r c u l a r , t o move from t h i s (the submitted premise upon which the cases r e l y ) t o the
conclusion t h a t i f the promises were t o be binding tihere must have been consideration.
From being an i n g r e d i e n t which, w i t h others,may render a promise binding, consideration
becomes t h a t which must have been present i n a l l circumstances i n which a promise has
peen held t o b i n d a promissor, ••Without handing language and usage over t o Fowler, i t
ijtiay be convenient t o rescue words from C a r r o l l ' s Humpty-Duii?)ty.
22
[?he decision i n Couchman v H i l l
has appended t o i t by the editor o f the Incorporated
iSociety's Reports a note. Scott, L J, reading the judgement o f the Court o f Appeal
h e l d t h a t although the catalogue excluded a l l relevant l i a b i l i t y f o r goods sold a t an
:
.7
(1860) 3Lr 170.
j'ootnotes:
1.8
(I9hl) 1 A l l S R 7i;9 a t p 751F.
19
I b i d P752G.
20
Except i n r e l a t i o n t o West Yorkshire Darracq v Coleridge (1911) 2KB326 upon which
Simonds J does n o t r e l y .
2|l
Re W i l l i a m Porter (1937)2 A l l S R 36I a t p36i4A.
22
(19U7) KB 55U.
P T 0
79
auction sale, the p l a i n t i f f was e n t i t l e d t o recover damages t y reason o f an o r a l
guarantee given by the vendor w h i l s t the goods were i n the r i n g but p r i o r t o t h e i r sale.
The e d i t o r suggests t h a t such a promise by a purchaser could n o t ' i f i t s l e g a l i t y were
challenged, be upheld J' since bidders a t an auction have a r i g h t t o suppose that they
23
b i d on equal terms.'
Such r i g h t i s e i t h e r very i n s u b s t a n t i a l on the facts of the case,
or i s u n v i o l a t e d : as counterpart to the bidders' r i g h t , presumably the vendor and the
auctioneer have a duty t o avoid making the terms unequal. I f the duty were not met,
91
damages f o r i t s breach would be d i f f i c u l t t o measure,
f o r even i f the argument that
a l l p a r t i e s s t i l l b i d on equal terms, (the agreement a f f e c t i n g the r i g h t s of a
p a r t i c u l a r bidder i f he should be successful) i s r e j e c t e d , the loss t o the other bidders
i s problematic. P l a i n t i f f here might have been prepared t o b i d more, knowing of h i s
special p o s i t i o n v i s a v i s the vendor on being successful, but t h i s does not assist
w i t h the assessment of what each of the others may have l o s t .
To avoid d o c t r i n a l d i f f i c u l t i e s which may or may not be r e a l i s t i c , such as whether i t
i s consistent w i t h the approach of the courts t o auction sales t h a t one bidder should
be makiiag a d i f f e r e n t o f f e r t o the auctioneer, unknown t o the others, i t might be
possible t o see the representation made by the vendor as a representation not to enforce
b e r t a i n terms of a contract even should a contract be made on those t e r m s ? ^
^ s i m i l a r case, t h a t o f Walker v Walker,
involved the lease of a f l a t under a standard
13
At P560.
Footnotes:
Ik
Presumably the breach would not be i n contract see Harris vNickerson
(l873)
2R8QB 286. The general a t t i t u d e o f the courts t o exclusion clauses i s one of
h o s t i l i t y , so t h a t presumably i n the absence of any fraudulent r i g g i n g o f the
auction i t seems u n l i k e l y t h a t an agreement which depends f o r i t s e f f e c t on the
ordinary outcome o f tihe auction sale, would be avoided.
ikA - c f C i t y of Westminster Property v Mudd (1958) 2 A l l E R 733 a t p7U2 I per Harman J.
;?5
(I9ii7)l77 LT
20U.
P T O
80
form o f lease which made no reference t o an agreement alleged by the tenant t o have
been made between himself and the p l a i n t i f f comparer t h a t he should have the use of two
a d d i t i o n a l rooms i n which t o s t a r t h i s property. Somervill, L J, decided, on being
s a t i s f i e d by the defendant's evidence, t h a t the company should not have an i n j u n c t i o n
to prevent the tenant's use o f the rooms. The o r a l agreement r e l a t i n g t o the rooms
might be enforced e i t h e r by means of r e c t i f i c a t i o n o f the lease or by implying a
c o l l a t e r a l warranty, the court held. I n both t h i s and the previous case, the r e s u l t i s
'that the o r a l agreement should be read w i t h the w r i t t e n instrument so as t o form one
[comprehensive
the
contract, ^^and i t may seem pedantic t o analyse the reasoning i n terms of
d i s t i n c t i o n between law and equity. I ' suggest t h a t where c o n t i n u i t y and convenience
of outcome are compatible i n the single case, and especially where regard f o r past
forms p o i n t s a p r a c t i c a l way f o r the f u t u r e , a t t e n t i o n t o h i s t o r y may be worthwhile.
^ h u s , accepting Hohfeld's view^^ 'the so c a l l e d l e g a l r u l e i n every such case ( o f
^ c o n f l i c t between equity and law) has...only an apparent v a l i d i t y - a n d operation as a
matter o f law. Though i t may represent an important stage of "thought i n the s o l u t i o n
of the problem, and may also connote... important p o s s i b i l i t i e s as t o certain other
closely-associated (and v a l i d ) j u r a l r e l a t i o n s , y e t as regards the very r e l a t i o n i n
which i t s u f f e r s d i r e c t con?)etition w i t h a rule o f equity, such c o n f l i c t i n g r u l e of law
28
i s pro tanto o f no greater force t h a t an u n c o n s t i t u t i o n a l s t a t u t e . '
I t would be
flootnotes:
2|6
Cheshire & F i f o o t 8th Ed pl09.
27
Hohfelds The Relations between Equity and Law 11 Mich L Rev 537 t h a t 'there i s . . .
a.;, .marked.. . c o n f l i c t between equitable and l e g a l rules r e l a t i n g t o various j u r a l
r e l a t i o n s : and whenever such c o n f l i c t occurs the equitable r u l e i s i n the l a s t
analysis paramount...' (p5Mi).
2j3
P5U+. Note t h a t there i s nothing inconsistent involved i n urging, on the one hand
the
u n i t y o f law and equity, and on the other, the u t i l i t y of seeing f i r s t l e g a l
r i g h t s , and secondly equitable r e s t r a i n t s which may be placed upon them: i t i s
merely 'a stage o f thought.'
P T0
81
possible t o see the l e g a l r e s u l t of the agreements i n Gouchman v H i l l and Walker v
[ W a l k e r r e s t i n g upon the w r i t t e n contracts, but being subject to the equitable r u l e t h a t
a representation 'intended to be binding, intended to be acted upon and. . . i n f a c t acted
29
upon'
should b i n d the representor. As w e l l as providing greater symmetry i n Walker,
s e t t i n g up an e q u i t y as an a l t e r n a t i v e t o the equity o f r e c t i f i c a t i o n i n achieving the
jdesired r e s u l t , such an analysis avoids the murky waters of i n t e n t i o n to which Cheshire
f i n d s i t necessaiy to r e f e r ^ ^
I t i s not suggested t h a t t h i s was the l i n e of reasoning followed i n e i t h e r case: merely
t h a t both are r e s u l t - o r i e n t e d decisions, and t h a t the same r e s u l t might have been
achieved w i t h greater b e n e f i t f o r both past and f u t u r e by the use of the equity, ffyi n i t i a l postulate concerning the need f o r the e q u i i y of promise-enforcement i s supported
•by these cases.
p?wo cases i n v o l v i n g representations by the Grown were heard i n 19U8:
Territorial
Amy
f^lv Nichols^"^ and Robertson v M i n i s t r y o f Pensions'?^ I n the f i r s t , the Court of Appeal
accepted t h a t the Rent R e s t r i c t i o n Acts d i d not apply t o the Crown, and t h a t the
t e r r i t o r i a l Arny, which had issued a r e n t book i n d i c a t i n g tenancy r i g h t s under the Acts,
attracted 'the contagion of the Crown's immunity.'"^"^ The question was raised whether
ihe immunity was i n any way undermined by the representation made to the tenant by the
;.ssue of the r e n t book, and the court r e l i e d upon a dictum of Bowen, L J i n Low
v
Itouverie (ante) t h a t 'the language upon which an estoppel i s foiinded must be precise
£,nd unambiguous, '•^^ f i n d i n g t h a t the r e n t book, when combined w i t h a l e t t e r from the
].essor s t a t i n g the tenancy's terms (which were inconsistent w i t h the Acts) c l e a r l y , was
riot a s u f f i c i e n t l y precise representation. Bowen L J's dictum implies t h a t the promissee,
I'ootnotes:
Rickards v Oppenheim (19^0) 1 A l l B R 1;20
p
0
Cheshire & F i f o o t 8ed
(see l a t e r ) .
pl09.
jll
(I9i;9) 1 KB 35
32
(I9h9) 1 KB
33
(I9h9) 1 KB 35 a t phh per Scott, L J, who read the judgement of the court.
3li
(1891) Ch 82 a t pl06 c i t e d op c i t p^O.
( T e r r i t o r i a l & A u x i l i a i y Forces Assoc of the Go o f London v Nichols)
227.
P T 0
82
the tenant, acted unreasonably, since i t must surely be so, t o act upon a representation
which i s not free o f ambiguity. The u n a r t i c u l a t e d object o f the court i s t o rescue
from i n j u s t i c e one threatened by i t , but a condition of the court's action i s t h a t he
s h a l l have done a l l t h a t he reasonably should have done-?^ The t e s t sounds l i k e an
equitable one, and i s variable according w i t h where the court considers t h a t r i s k s
ought t o be placed.
An argument advanced by counsel f o r the Amy
i s worth examining f o r i t s apparent l o g i c ,
t h a t i s , t h a t i f the s t a t u t e does not bind the Crown d i r e c t l y , estoppel cannot make i t
do so. I n p r i n c i p l e o f course, estoppel has exactly the e f f e c t of enabling t h a t t o be
accomplished which, but f o r a representation by the promissor could not be accomplished. '
Et i s d i f f i c u l t t o see why the necessity which allows the Crown t o claim an immunity
3y s t a t u t e should operate t o prevent the Crown from apparently waiving i t s immunity,
and even i f i t does, i t i s d i f f i c u l t t o see why l i a b i l i t y i n damages i s not incurred:
i'ootnotes:
•}5
c f the equitable maxims concerned w i t h laches, 'clean hands' etc.
i6
Associated w i t h t h i s contention i s the suggestion, t o which more weight was
attached, t h a t the representation was one of law and not of f a c t . The a p p l i c a b i l i t y
of the Rent Acts t o the Crown may w e l l be a matter of law, but the question of
whether the Act applied t o a p a r t i c u l a r dwelling i s surely out of f a c t . To argue
t h a t X does not have the a t t r i b u t e s necessary t o own property may be t o argue a
matter o f law: i f X stood l y and allowed I t o s e l l goods as Y's he could not
generally assert h i s own t i t l e against the purchaser, f o r he would be taken t o
have made a representation of f a c t despite the l e g a l nature o f the concept o f
ownership. One suspects t h a t the fact/law d i c t i o n a r y i s t e l i o l o g i c a l . See Birch v
Pease St P a i f e r s (l9Ul) 1KB6I5 (Reliance placed on a representation o f l i a b i l i l y
I
under the Workman's Compensation Acts: representation enforced). See also Solle
V Batcher ( p o s t ) .
3?
See Wroth v Tyler (1973) l A l l E R 897 a t p910F, although t h i s arises out o f the
character o f the Land R e g i s t r a t i o n Act 1925 s 139(1).
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83
the p o l i c y of the statutes i s t o p r o t e c t the Crown i n i t s occupation of property, and
not t o leave the subject w i t h no form o f redress.
The second case involved an An^y o f f i c e r who made a claim f o r a d i s a b i l i t y pension t o
the ¥ar O f f i c e , i n respect o f an i n j u r y sustained w h i l s t on m i l i t a r y service i n
December 1939. Under a Royal Warrant f o r Pay o f 19hO, a u t h o r i l y t o 'accept ( i n j u r i e s )
as a t t r i b u t a b l e . t o m i l i t a r y service' was t r a n s f e r r e d from the War Office t o the
M i n i s t r y o f Pensions except-where the i n j u r y occurred before September 1939. Nevertheless
the D i r e c t o r f o r Personal Services wrote purporting t o accept the i n j u r y f o r d i s a b i l i t y
pension purposes, and, r e l y i n g upon t h i s acceptance Colonel Robertson forebore t o
obtain independent medical assessment of h i s condition, and Xray evidence disappeared.
Subsequently the M i n i s t r y o f Pensions disallowed the i n j u r y . 'Is the M i n i s t r y o f
Pensions bound by the War O f f i c e letter?...They assumed a u t h o r i t y over the matter...
i f a government department i n i t s dealings w i t h a subject takes i t upon i t s e l f t o
assume a u t h o r i t y over a matter w i t h which he i s concerned, he i s e n t i t l e d t o r e l y upon
|its having the a u t h o r i t y which i t assumes...He does not know, and cannot be expected
39
bo know the l i m i t s o f i t s a u t h o r i t y . '
J
Denning, J d i f f e r e n t i a t e s the case from those i n contract. Insofar as the promissee,
(polonel Robertson had not forebom t o secure f u r t h e r medical assessment a t the request
(*)f the War O f f i c e 'there i s no consideration given a t the time.' Rather 'the case f a l l s
I
v/ithin the p r i n c i p l e t h a t i f a man gives a promise or assurance which he intends t o be
iDindir^ on him, and t o be acted on by the person t o whom i t i s given, then, once i t i s
cted upon, he i s bound by i t . ' ^ ' ^
Footnotes:
8
See Fleming: Torts pp319-320. The Crown i s normally l i a b l e f o r the damage caused
by the negligent acts o f i t s servants, except, i t seems, where they are negligent
i n t h e i r representation of matters concerning Crown Immunity.
See Denning J's comments i n Robertson v MoP (post) P231
39
Per Denning J a t p232. Neither can the subject be expected t o appreciate the
extent o f q u a l i t y o f Crown immunity, surely,
iip
P231.
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The l a t t e r p r i n c i p l e can be seen . a t work i n Tankexpresse A/S v Compagnie Financiere
Beige des Petroles S A.
The appellants chartered a ship t o the respondents on terms
t h a t payments should be made a t a c e r t a i n time o f the month i n cash, or the ship would
(be withdrawn. Over the period o f h i r e payments had been made l a t e r i n the month and by
cheque, and t h i s was accepted by the appellants as performance o f the contract. The
l a t t e r were, n o t , t h e r e f o r e , ' e n t i t l e d t o vary the accepted method o f performance without
f i r s t n o t i f y i n g the respondents i n time t o enable them t o perform the contract i n
s t r i c t conformity w i t h the terms o f the charter party.'^^
I t i s not s a t i s f a c t o r y t o see. t h i s , or the s i m i l a r cases back t o Hughes as examples o f
the suspensory e f f e c t of the e q u i i y , because quite c l e a r l y the e f f e c t so f a r as the
a c t i o n i s concerned, i s not suspensory, but t o t a l . Mhere the response o f the promissee
J i s once f o r a l l , as i n Robertson, the e f f e c t o f the representation cannot be undone,
and the r e s u l t o f the e q u i l y i s p l a i n . I n the context o f a continuing r e l a t i o n s h i p , the
3quity operates w i t h i n the currency o f the representation which has the e f f e c t of
modifying expectations a r i s i n g out o f the r e l a t i o n s h i p . The representation may cease
to bind the promissor i f the promissee i s given n o t i c e , and i f i t i s e q u i t a b l e i n
1
a l l the circumstances f o r him t o r e v e r t t o the status quo ante - as i t c l e a r l y would
have been i n .TJie P e t r o f i n a , b u t n o t i n Robertson - so t h a t i n a subsequent action, or
perhaps as t o a p a r t of a present action, the promissor might be successful. I t i s
misleading t o suggest t h a t h i s l e g a l r i g h t s have been suspended^ they have been
overriden liy equity f o r as long as required ty equity.
Footnotes;
ill
(19U9)AC76. (The 'Petrofina').
k2
Op c i t p93 per Lord Porter.
i||3.
i e f a i r . Thus 'adequate p r o t e c t i o n i s given t o suppliers by the requirement t h a t
the notice should be reasonable. Per Denning, L J Rickards (post) pk2kA.>
l4x
Except i n the d i f f e r e n t sense, as applied by Hohfeld and adhered t o here, that
a l l o v e r r i d i n g e q u i t i e s suspend l e g a l r i g h t s except where j u r i s d i c t i o n i s
p a r a l l e l . I t i s t o the use of suspensory t o note temporary t o which we object
because i t obscures the true state o f a f f a i r s . There i s no q u a l i t a t i v e - difference
between the o v e r r i d i n g o f l e g a l r i g h t s f o r s i x months and doing so f o r e t e r n i t y .
I n both cases the court i s preventing the promissor from succeeding i n h i s action.
P T 0
85
I n Richards v Oppenheim^^ the respondent ordered a chassis and required a body t o be
b u i l t on the chassis ty a p a r t i c u l a r date. When i t was not b u i l t by t h a t date, he
continued t o press f o r d e l i v e r y , and by the representation t h a t he was s t i l l prepared
to accept d e l i v e r y he waived h i s r i g h t t o repudiate the contract: 'by h i s conduct he
made a promise not t o i n s i s t upon h i s s t r i c t l e g a l r i g h t s . ' ' That promise was intended
to be binding, was intended t o be acted upon, and was i n f a c t acted upon. '^^ The
Court o f Appeal accepted t h a t Oppenheim could not a t t h a t stage have i n s i s t e d upon the
terms o f the contract, and went on t o consider whether the notice which he gave the
dealer o f an i n t e n t i o n t o make time o f the essence was reasonable. There having been
a t i m e - s t i p u l a t i o n i n the o r i g i n a l contract, such notice as Oppenheim gave was v a l i d ,
and, being f o u r weeks, reasonable.
|TWO f u r t h e r cases i n 1950 involved the Rent R e s t r i c t i o n s l e g i s l a t i o n : Solle v Butcher^"^
1 R
and Welch v Nagy.
I n the f i r s t , i t must be relevant t h a t the p a r t i e s had been partners
i n an estate agent business, and t h a t i t was the tenant who represented t o the landlord
t h a t a p a r t i c u l a r f l a t was n o t i n i t s reconstructed form, subject t o the l e g i s l a t i o n .
ho
The Court set aside the lease on the ground o f mistake,
and the a p p l i c a b i l i t y o f the
J)tatute t o the f l a t seems t h i s time t o have been regarded as a matter o f fact^^'^'^ I t
lias, on the f a c t s therefore, unnecessary f o r the court t o decide whether or not estoppel
can oust the court from i t s . j u r i s d i c t i o n t o decide whether the r e n t claimed i n respect
c f any .dwelling house i n f r i n g e s . . .the.. .Act.'^"^ For a number o f reasons Bucknell L J's
I'ootnotes:
45
(1950) 1 A l l S R 1^20. But a promise t o do, on more favourable terms, what one has
already contracted t o do, i s n o t i n conventional doctrine, binding: S t i l k v I ^ r i c k
(1809) 12 comp 317.
i4|6
Op c i t pU23S •
1^7
(195O)1KB671.
US
(1950) lKBi;55.
For the terms suggested ty Denning L J see (1950) IKB67I a t p697.
53
c f T e r r i t o r i a l Amy v Nichols
5:L
(1950) IKB67I a t p683 (per B u c k n i l l , L J ) & a t p695 (per Denning L J ) .
5:!
p695.
53
A t p688.
(ante).
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86
dictum would not embrace the e q u i t y r e l i e d on i n the Hughes cases. Denning i s a t pains
not t o subsume the e q u i i y under the doctrine o f estoppel^^ f o r there would be l i t t l e
p o i n t i n pursuing the i m p l i c a t i o n s o f one doctrine i f i t were subject t o p r e c i s e l y the
l i m i t a t i o n s s u f f e r e d by another.
Second, a misconception may have arisen t o the extent t h a t the e a r l i e r case of Welch
V Nagy^^ was r e l i e d on. Here, the defendant became the tenant of furnished premises,
and, a f t e r some months bought the f u r n i t u r e from the l a n d l o r d . The l a t t e r liien sold
the house t o the p l a i n t i f f , and purported t o s e l l the f u r n i t u r e as w e l l . When the
tenant wrote t o the new l a n d l o r d excercising h i s option.to extend the tenancy he
mistakenly described the premises as 'furnished.« I f the premises, which had c l e a r l y
become 'de f a c t o '
56
unfurnished, remained 'de j u r e '
56
furnished, the court would have
had a much wider j u r i s d i c a t i o n t o grant possession, but t h i s would be 'to confer on
the court
by act of one of the p a r t i e s a j u r i s d i c t i o n (namely an untrammelled power
t o make orders f o r possession of premises i n f a c t unfurnished) which Parliament has
57
I s a i d t h a t the Courts s h a l l not have. '
The s o l u t i o n i n the case i s not questioned, but
I t h e reasoning appears, l i k e much of the reasoning concerned w i t h equitable estoppel,
or the Hughes p r i n c i p l e , t o owe too much t o the law of contract. A contract i s 'a
promise, or set of promises which the law w i l l enforce,' and 'the p a r t i e s . . .are free
HO
bo make t h e i r own r u l e s as to what s h a l l and s h a l l not bind them.'
•"ootnotes:
51;
Robertson v MoP
A l l that i s
(I9i;9) 1KB227 a t p230s 'Those cases are not cases of estoppel i n
the s t r i c t sense...' Rickards v Oppenheim (195Q) 1 A l l B R i|80 a t pi;230s ' I t i s
a k i n d of estoppel.' Central London Property Go v High Trees House (19U7)KB130 at
PI364 ' I f the case had been one of estoppel i t might be said t h a t i n any event
the estoppel would cease when the conditions t o which the representation applied
came t o an end. . . I p r e f e r t o apply the p r i n c i p l e t h a t a promise intended t o be
binding, intended t o be acted on and i n f a c t acted upon i s binding so f a r as i t s
terms p r o p e r l y apply.'
(1950) 1KBU55.
5j6
Per Asquith, L J at pi|6l
57
Per Asquith L J a t pl46i;.
5p
C h i t t y : Contracts, General P r i n c i p l e s 1.
P T 0
87
claimed f o r the e q u i t y i s t h a t i t w i l l rescue one party from the consequence of h i s
r e l i a n c e upon a promise, or an apparent promise. I n contract the 'power o f the i n d i v i d u a l
to e f f e c t changes i n h i s l e g a l r e l a t i o n s w i t h others i s comparable t o the power o f the
59
legislative.
I t i s i n f a c t only a k i n d o f p o l i t i c a l prejudice which causes us t o use
the word law i n one case, and not i n the other. '^'^ As delegated l e g i s l a t u r e must not
exceed an empowering s t a t u t e , so the law-making power o f i n d i v i d u a l s must not be
allowed t o contravene statutes dealing w i t h the subject matter i n question. When a
person seeks the r e l i e f o f the equity, he does not assert that the p a r t i e s reached an
agreement, and, whether or not t h i s 'law' i s one which they were competent t o make,
the
courts must enforce i t . He says instead t h a t he has been led i n t o a p a r t i c u l a r
p o s i t i o n , and he asks the court t o help him out o f i t . I t was not h i s desire t h a t he
should be i n the present p o s i t i o n .
Thus, i n Welch v Nagy, had the p a r t i e s agreed t o t r e a t what were i n f a c t unfurnished
premises as furnished, so as t o confer a broader j u r i s d i c t i o n upon the court, they
could n o t have enforced the agreement. Instead the l a n d l o r d has been induced t o
undertake c e r t a i n obligations on the basis t h a t c e r t a i n f a c t s were true. I f they were
t r u e , the court would have had an enhanced j u r i s d i c t i o n over the tenancy. 'Why could the
court not preclude the tenant from denying the t r u t h o f the facts i n an appropriate
case, i f f a i l u r e t o preclude him would r e s u l t i n an i n j u s t i c e ?
|As i n the Robertson case^ i t seems t h a t the courts are committed u n c h a r a c t e r i s t i c a l l y
to r e s t r a i n t upon freedom. I f contracts i n excess o f statutes are enforced, then the
•purpose o f the s t a t u t e - indeed the whole concept o f l e g i s l a t i o n - i s gone: but i f a
s t a t u t e obstructs a remedy and leads t o i n e q u i t y i n doing so, no purpose i s served.
Footnotes:
59
P a r t i c u l a r t y i n the U S where Parliamentary sovereignty i s unknown. Increasingly
i n the U K, where l e g i s l a t i v e power, w i l l have t o be used i n conformity w i t h
, i ! E C p o l i c y or face annulment i n the European court.
^0
F u l l e r , Consideration & Form kl Golum Law Rev 799 a t p807.
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88
This has been recognised i n other cases^"''
I n P e r r o t t V Cohen^^ the Coxirt of Appeal construed the occupation by a tenant o f
c e r t a i n l a v a t o r i e s not included w i t h i n the lease as a representation by him t h a t they
were w i t h i n the demises 'The p r i n c i p l e i s t h a t a man who gets i n by reason of being
tenant, must take l a n d as under h i s o r i g i n a l take.'^^ The landlords acquiesced i n the
tenant's conduct, and at the t e r m i n a t i o n of the lease brought an action against the
tenant on the r e p a i r s
covenants. The tenant was bound l y h i s o r i g i n a l -representation,
f o r 'the representation was i n e f f e c t a promise or assurance, t h a t the terms of the ,
lease should apply t o the a d j o i n i n g piece ( o f land)...and i t i s binding on the p r i n c i p l e
which I endeavoured t o state i n Central London Property Co v High Trees House ( a n t e ) . ' ^ ^
I t should be n o t i c e d t h a t the tenant-promissor i s the defendant, and t h a t h i s promise
i s being enforced a t the behest of the landlord-promissee. Aside from the representation,
p l a i n t i f f has no cause o f a c t i o n , except perhaps i n quasi-contract. For t h i s reason i t
Footnotes:
61
See White, & Tudor: Cases i n Equity 8th e d i t i o n p86 e t seq (cases on the Statute o f
Frauds). Also Birch v Pease & Partners (l9ijl) 1 A l l E R 331;: Workmen's GoiT?)ensation
Act 1925 51i3* 16 provided t h a t where a workman on entering employment f a l s e l y
denied having suffered from a disease, compensation was not payable. With
knowledge o f the f a l s e statement, the compaiiy paid compensation. The court upheld
the 'claim by the workman t o continued payments. Also Kingswood v Anderson (1963)
2QBI69 though here reliance i s placed upon another statute. See also Hamam Singh
V Jamal P i r b h a i ( l 9 5 l ) AC688. D i f f e r e n t codes, r e s t r i c t i n g rents of respectively,
dwelling houses and business premises. The Privy Council decided that where the
premises were •m±xed;i' the court must, choose, the more, appropriate c l a s s i f i c a t i o n .
The a c t i o n o f the party ousted
the j u r i s d i c t i o n o f the p a r t i e s as t o one of these
codes. Moreover i t was a l e t t e r from the tenant's s o l i c i t o r which gave the court
j u r i s d i c t i o n under the
l e g i s l a t i o n applicable t o statutory tenancies. (p699).
62
(1950) 2 A l l E R 939.
63
A t p9ii,l per Somervlll, L J, c i t i n g Charles, J i n Tabor v Godfrey (ante).
6U
At. p9i;3 per- Denning, L J.
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89
i s s u r p r i s i n g t o f i n d Denning L J, i n Combe v Combe^^ asserting t h a t the High Trees
' p r i n c i p l e does not create new causes o f a c t i o n where none existed before'^^
Here, f o l l o w i n g the pronouncement o f a decree n i s i the promissor promised t o pay h i s
former wife £100 annually, a f t e r deduction o f income tax. She pressed f o r payment,
but w i t h o u t success, and, a f t e r more than s i x years brought an action on the promise.
At f i r s t instance '^me, J found i n her favour, but was reversed on appeal. Consideration
was thought t o be necessary t o support the promise, unless i t was being used as a
defence, or as 'a p a r t of a cause o f a c t i o n but not a cause of action i n i t s e l f . '
In
none of the cases r e l i e d on by the wife 'was the defendant sued on the promise,
67
assurance, or a s s e r t i o n as a cause o f a c t i o n i n i t s e l f , '
68
Denning L J said, apparently
i g n o r i n g P e r r o t t v Cohen.
I f i t h Conibe v Combe the c r e a t i v i t y i n s p i r e d by the High Trees decision seems t o have
reached i t s z e n i t h . We have seen t h a t although the equity has had a continued existence
Footnotes:
65
(1951) 2KB215. See A t t y a h : Consideration p5l.
56
I b i d a t p219.
57
I b i d p220.
58
I t would be possible t o i n t e r p r e t P e r r o t t v Cohen more narrowly, though none o f
the
judges seems t o have done so i n Combe v Combe, and r e s t r i c t e d to matters
concerning l a n d l o r d and tenant. See Cohen, L J's judgement (Perrott v Cohen (1951)
IKB705 a t p709. 'fffer doubt was whether the equitable p r i n c i p l e on which the judge
a r r i v e d a t h i s decision was r e a l l y applicable t o the f a c t s as he found them.
Fortunately I am not compelled t o reach a conclusion on that p o i n t because ( o f )
Tober v Godfrey' (ante).
See Denning L J's judgement, a t p710: ' I know t h a t t h i s looks l i k e creating an
estoppel almost as i f i t were a cause o f a c t i o n i n Rickards v Oppenheim, the case
c i t e d as a u t h o r i t y l y Denning, L J.
P T0
90
since 1875, f o r much o f t h i s time i t has been submerged. High Trees represented a
renewed a r t i c u l a t i o n o f a necessary p r i n c i p l e , but because on the facts t h i s declaration
of p r i n c i p l e was o b i t e r i t was some time before the 'kind of estoppel' could be asserted,
openly and w i t h confidence. Except f o r those who view the decision i n i t s proper context,
and have regard f o r the basic p r i n c i p l e t h a t a man mast keep h i s word and compensate
those who not reasonably l e d astray, the phenomenon i s surprising and the r e a c t i o n o f
the Court of Appeal i n Combe v Combe merely moderate.
[The Court could not e a s i l y uphold both the wife's claim and the doctrine o f considerations^
70
We have suggested
t h a t both e t h i c a l and p r a c t i c a l requirements p o i n t t o the adoption
of the e q u i t y , and are o f the view t h a t the t r a d i t i o n a l dogma w i t h i n h i s t o r i c a l subject
boundaries should j u s t i i y themselves when they c o n f l i c t w i t h i t . That the law ought t o
8l
|ericourage men t o keep t h e i r promises unless there i s some p o s i t i v e contraindication
71
[does not seem extravagantly i d e a l i s t i c !
Whether any such contraindication exalts the
consideration doctrine when c o n f l i c t occurs i n Combe v Combe may be answered by
iFootn'otes:,-- •. .• .
'^9
Although courts have performed more d i f f i c u l t feats. See Gore v Van der Lann (1967)
A l l g R 360. See also T r e i t e l 3rd ed p57 e t seq, especially ppl08-ll6.
70.
See i n t r o d u c t i o n .
71
I n p a r t i c u l a r Rawls' r a t i o n a l l y s e l f - i n t e r e s t e d man would doubtless s t i p u l a t e
i
I
such a l e g a l approach from behind h i s v e i l of ignorance. See Rawls: A Theory o f
Justice. See also, b r i e f l y , Runciman: Relative I^zioration & Social Justice, f o r an
attempt t o context j u s t i c e i n society.
81
See A t i y a h : Consideration i n contracts - A fundamental restatement 5l« He suggests
t h a t Combe v Combe achieved a f a i r solution,-upon the facts and c i t e s Denning, L J
i n support of h i s own conclusion, t h a t the case 'decided nothing more than t h i s ,
t h a t an act or forbearance which n a t u r a l l y and forseeably follows from and i n
r e l i a n c e on a promise i s not a consideration f o r ' t h e enforcement o f the promise
what the j u s t i c e o f the case does not require that i t should b e ' l p52: the
i t a l i c s are h i s ) .
P T0
91
72
approaching
the l i t e r a t u r e i n the l i g h t o f F u l l e r ' s analysis. Commentators have
stressed the importance o f the r o l e played by consideration i n the enforcement o f
promises - notably, t o adopt F u l l e r ' s terminology concerning the function o f l e g a l
f o r m a l i t i e s , the evidentiary, cautionary, and channelling tasks performed. There i s no
73
reason t o suppose t h a t only consideration can perform these tasks i n the context
generally, nor, in. the case o f Combe v Gombe was the suggestion made that the husband's
promise had been i n c a u t i o u s l y made, was vague, or t h a t i t had not been made a t a l l . I t s
existence, and the wife's r e l i a n c e upon i t were accepted. A l l t h a t consideration could
have bestowed
on a contract was i n f a c t provided by other means, but because consideration
7^
i t s e l f was unsung the promise could not be upheld.
That the wife had, i n reliance on
the promise, forebome t o sue, was, no doubt q u i t e r i g h t l y , held not t o be consideration
7l
[because she could not have so bound h e r s e l f i n advance.
Footnotes:
^|72
F u l l e r : Consideration & Form kl Col L Rev 799. See also Wrights Ought the Consideration
Doctrine t o be Abolished from the Common Law? k9 H3:v:ard Law Rev 1225; Harrison: The
Reform o f Consideration CCXIV IQR237; Gardiner; An I n q u i r y i n t o the P r i n c i p l e s o f
the Law o f Contracts 14.6 HLRl, a t p9, but p a r t i c u l a r l y pp22-i4.3; linger: (the conservative
view) |;ntention t o create l e g a l Relations, Consideration, & M i t u a l i t y 19MLR96.
"^3
See the proposals o f the Law Revision committee S i x t h I n t e r i m Report (1937) Gmd
5UU9
J & Ha»i.sdnoii.: The Reform of Consideration SMI/ f o r a c r i t i c i s m o f the
more r a d i c a l proposals.
See the cominent o f Henderson: Promissory Estoppel & T r a d i t i o n a l Contract Doctrine
78 Yale L J 3U3 a t p3U7: ' I t i s easy t o forget t h a t while reliance may i n some
instances be e s s e n t i a l t o bargain theory, bargain i s not e s s e n t i a l t o reliance theory,
•j'Though i t t y p i c a l l y accompanies bargain transactions, conduct i n reliance occurs i n
a v a r i e t y o f forms & degrees and may w e l l be induced independent o f the making o f a
bargain.. .But the f a c t t h a t reliance coincides w i t h bargain i n some cases tends t o
p u l l i t w i t h i n the c l a s s i f i c a t i o n i n a l l cases.'
7j5
'...Consideration i s too f i r m l y f i x e d t o be overthrown by a side-wind' per Denning, L J
i n Comhe v Gombe ( l 9 5 l ) 2KB215 a t p220.
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92
I am not concerned f a r t h e r w i t h the a p p l i c a t i o n o f the ordinary rules of contract to
t h i s case, except t o r e g r e t t h a t a b e n e f i t de facto conferred could not be seen as
s u f f i c i e n t support f o r a r e t u r n promise, even though by the nature of the s i t u a t i o n i t
could not have been assured u n t i l the operation o f the L i m i t a t i o n Act.
I venture a suggestion, but one which could not r e a l i s t i c a l l y be urged upon the courts.
Rather, I perceive dimly from study of the pragmatic accretion of decisions through
which change occurs i n English judge-made law, and more especially from observation of
the l e g a l system as a whole, an a l t e r a t i o n i n emphasis. Hence forward, I submit, t h i s
a l t e r a t i o n may be seen being accomplished i n the courts t y means of our equity i n i t s
v a r i e d guises. Just as the process which comes t o be known i n Norman England as Covenant
i s said t o be the product of a society (and p a r t i c u l a r l y of a caste i n society) which
77
attaches a s p e c i a l significance t o questions o f honour and a duty t o keep one's word,
so the binding nature of a bargain-contract i s a product of a society placing unusual
emphasis on i n d i v i d u a l i s t i c self-expression. The bargain-contract enables a person, an
[entrepreneur, t o improve h i s p o s i t i o n v i s a v i s other members of society, and u l t i m a t e l y
7ft
to e x p l o i t h i s superior economic e f f i c i e n c y .
Capitalism l e f t unchecked leads t o monopoly.
76
See Corbin: Non-binding promises as consideration 26 Col L Rev 550 at p557 'The
Footnotes:
dictum t h a t both p a r t i e s t o a b i l a t e r a l agreement most be bound or n e i t h e r i s bound
i s i n v e t e r a t e ' - though t h i s i s admittedly not supported t y 'an exhaustive study of
the
cases.•
Note t h a t i n an executory contract, the f i r s t promise caimot be binding u n t i l the
promissor has received the second. I f the f i r s t promise i s subject t o a condition
precedent i t i s not very d i f f e r e n t from the promise i n Combe v Combe: i t i s not
binding u n t i l the c o n d i t i o n i s f u l f i l l e d , any more than Mrs Combe's promise before
the
77
operation of the s t a t u t e .
H a z e l t i n e : The Formal Contract of Early English Law 10 Col Law Rev608 on the
Anglo-Saxon o r i g i n of the formal promise.
V8
See Rehbinder: Status, Contract & the Welfare State 23 Stanford L Rev9ia. Also Weber:
Law i n Econoiry & Society (ed Rheinstein) p301.
'The Formal Q u a l i t i e s of Modern law'
where he discusses the commercial stamp placed upon transactions and the 'demands
f o r a 'social law'...directed against the very dominance o f a mere business m o r a l i t y . '
(p309).
P T 0
93
and contract as the paradigm o f l a i s s e z - f a i r e capitalism becomes unworkable except
79
subject t o r e s t r a i n t .
A new s o c i a l departure i s made v i s i b l e by the welfare s t a t e :
there i s the r e c o g n i t i o n t h a t l e g a l duties o f support are owed by i n d i v i d u a l s w i t h i n
the community t o one another. Covenant and the bargain-contract are called i n t o being
by the demands o f a p a r t i c u l a r era, and i n the same way a new p r i n c i p l e i s i n the
process of being constructed by the present.
The new p r i n c i p l e , which has t o give e f f e c t t o the concept o f interdependence
i n e v i t a b l y c o n f l i c t s w i t h the bargain-contract and may u s e f u l l y be dated from 1932,
when i t was necessary t o overthrow the ' p r i v i t y of contract fallacy* i n order t o set up
8o
the ^neighbour t e s t . '
I t s t r a n s a c t i o n a l i m p l i c a t i o n s have t o be found expressed i n
the o l d terminology.
Footnotes:
79
e g the T a f t - H a r t l e y Act and the Renegotiation Act i n the U S. I n t h i s country
Statutory Restraints include the Race Relations Acts, the Rent Acts and the Hire
Purchase Acts. Also the remedies given t o consumers
as an adjxinct t o the
c r i m i n a l process (a method deplored t y Pollock f o r i t s implications, i n what's
i n a Name? (1956) Grim L R792,* the Distinguishing Mark of a Crime 22MIRi;95, who
f a i l s , w i t h respect, t o note the r e t u r n t o a less laissez f a i r society which t h i s
use o f the c r i m i n a l courts symbolises). See Stone: Social Dimensions Chapter 15-
95
[word misleads^ unless
reference i s made t o the context!!^
I n the f o l l o w i n g year B r r i n g t o n v E r r i n g t o n ^ was decided. For h i s son and daughter i n
law t o l i v e i n , a f a t h e r bought a house i n h i s own name. He obtained a mortgage i n
order t o buy i t and remained l i a b l e t o meet the repayments, but he handed the repayment
book t o the daugher-in-law, saying t h a t the house was a present t o the couple, and t h a t
i t would become t h e i r properly provided t h a t they met the repayments. He died, and i n
the same year h i s son l e f t the daughter-in-law, and went t o l i v e w i t h h i s mother. The
mother, as e x e c u t r i x o f the f a t h e r , sought possession from the daughter-in-law, and
the question was, therefore, what i n t e r e s t the daughter-in-law had i n the properly.
Denning L J was s a t i s f i e d 'that the couple were licensees having a permissive occupation
short o f a tenancy but w i t h a contractual r i g h t , or a t any rate an equitable r i g h t t o
remain so long as they p a i d the instalments.'^
Again, the d i f f i c u l t y was t o safeguard the daughter's entitlement without conferring
on her an absolute t i t l e free of the o b l i g a t i o n to meet
the mortgage repayments
'which would be q u i t e contrary t o the j u s t i c e o f the case.'^ At common law a licence
could be revoked a t the l i c e n s o r ' s w i l l i n despite of any contract. This p o s i t i o n i s
ho longer the case and 'since the f u s i o n o f law and equity no court i n t h i s country
would refuse a p l a i n t i f f i n WoodTs"^ s i t u a t i o n the remedy f o r which he asked. '^ I n other
^ords the grounds o f the r e l i e f which the licensee may claim are equitable, and
Footnotes:
See Pears: W i t t g e n s t e m 58. An assertion i n ordinary f a c t u a l discourse i s a 'gross
move.' I m p l i c i t i n any complex p r o p o s i t i o n are many elementary propositions by
which the complex p r o p o s i t i o n i s understood or misunderstood.
i|A
The attempt t o understand licenses by reference t o a conceptual c l a s s i f i c a t i o n i s
i n our view misguided. See: London Borough of Hounslow v Twickenham Garden
Developments L t d . (1970) 3 A l l B R 326. They must be seen i n r e l a t i o n t o t h e i r
efficacy.
(1952)1 A l l S R li;9.
I b i d pl5i;.
I n Wood V Leadbitter 13 M & W 838.
ffiinter
Garden Theatre case (ante) p l 9 1 per Viscount Simon.
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V:l
Since the c h i e f advances i n the use of the equity i n the next period under consideration
are t o be found are i n r e l a t i o n t o r e a l property, i t may be u s e f u l to begin t y r e f e r r i n g
to Foster v Robinson^ a case predating Combe v Conibe (ante) t y some months.
A farmworker occupied a farm cottage a t a low r e n t . I n 19i|.6 he was no longer able t o
work whereupon the farmer, h i s l a n d l o r d , i n d i c a t e d that he could continue t o occupy the
cottage r e n t free f o r as long as he l i v e d , l/hen he died, h i s daughter, who had been
l i v i n g w i t h him i n the cottage f o r nine years, took out l e t t e r s o f administration and
sought t o remain i n the cottage. What became o f her i s of no importance here, save
i n s o f a r as her f a t e , which was the issue before the court depended upon the r i g h t which
her f a t h e r had had conferred upon him i n 19U6.
Evershed, M R d i d not consider whether
there was a tenancy a t w i l l , but p r e f e r r e d the view 'that the tenant was e n t i t l e d as
[licensee to occupy the premises without charge f o r the r e s t of l i i s days.' Moreover, ' I f •
jthe l a n d l o r d , having made the arrangeiiBnt, sought t o revoke i t , he would be restrained
t y the court from doing so.'
The problem facing the court was t o accept t h a t the landlord's g r a t u i t i o u s promise was
jDinding
on him, but avoid doing so by creating an i n t e r e s t i n land to which h i s
illaughter might succeed. By using the concept of the licence, not only was
this
( d i f f i c u l t y overcome, but the promise i t s e l f seems t o have gained a force i t could not
otherwise iiave achieved i n the absence of consideration. " I emphasise the mere
. 3 T i s t r u m e n t a l i t y o f the licence i n giving e f f e c t t o the promise, since the use of the
iootnotest
(1950) 2 A l l S R 3h2. See the remarks o f S i r Raymond Evershed, M R at p3U6H.
See Cheshire: A New Equitable I n t e r e s t i n Land? 16MLR1J Crane: Estoppel Interests
i n Land 31 Conv (NS) 332j Maudsley: Licences to Remain on Land 20Conv (NS)28l.
Winter Garden Theatre v Millenium Productions (l9li8)AG173 was r e f e r r e d t o , but
foremost i n the court's mind i n the present case was whether the surrender of the
tenancy by operation of law would s u f f i c e t o remove the property from the Rent
R e s t r i c t i o n Acts. I n that case the licence had been created by an undoubted contract.
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96
Denning L J's statement t h a t ' t h i s i n f u s i o n of equity means t h a t contractual licences
now have a force and v a l i d i t y o f t h e i r own and cannot be revoked i n breach of contract'9
i s misleading, f o r i t i s not the contract which makes the licence irrevocable, but,
wider than contract, the terms upon which the r i g h t basing the l i c e c c e , are conferred.
These terras might be contained i n a g i f t j otherwise Foster v Robinson cannot be
explained.
I n F e r r i s v Weaven"^*^ the husband l e f t h i s w i f e , i n
I9I1.I,
i n occupation of the former
matrimonial house, and l i v e d apart from her. He promised t h a t ' I w i l l carry on paying
on the house p r o v i d i n g you do not annoy me. '"'"^ She complied by not seeking maintenance
payments from him. Then i n 1951,
the husband wished to dispose o f the house and sold
i t t o h i s brother-in-law f o r a nominal consideration, which he d i d not i n f a c t receive.
The p l a i n t i f f , the brother-in-law, sought possession from the w i f e . The court held
t h a t he was not e n t i t l e d to possession because the wife had a licence to remain i n the
house: the l i c e n c e was conferred by the husband's promise^ and the husband's promise
|was
g r a t u i t o u s , f o r the only r e t u r n by the w i f e was a forebearance t o 'annoy' him. This
:an only mean t h a t she forebore t o sue f o r maintenance, and since she could not i n law
12
30 bind h e r s e l f t h i s could not amount t o consideration f o r the husband's promise.
] l e a r l y , t o the extent t h a t the case r e l i e s on Bendall v McWhirterP and to the extent
that Bendall v McWhirter'^"^ has been overruled by the unfortunate decision of the House
Footnotes:
E r r i n g t o n v E r r i n g t o n (ante) a t pl55G.
j.0
(1952) 2 A l l S R 233. See also Webb v Paternoster, Palm 71 c i t e d Tudor: Leading
Cases i n Real Property etc i|th ed p805. •Where the owner of a dominant tenement
authorises the owner o f a servient tenement, although only by p a r o l , to do some act
thereon, the e f f e c t of which w i l l be t o prevent the f u t u r e enjoyment o f the
easement, i t w i l l be extinguished'. - i e irrevocable,
ll
I b i d p23i;B.
112
See Combe v Combe, and the discussion ante. Atiyah does not seem to take t h i s point.
13
(1952) 1 A l l E R 1307.
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97
of Lords i n NPB v Ainsworth'}^ i t cannot remain an a u t h o r i t y . However, i n the l a t t e r case
the bank took t y reason o f a ' v a l i d t r a n s f e r , ' w h i l s t the brother-in-law i n F e r r i s took
by v i r t u e of a 'sham sale'"}^ Moreover, there seems to have been no licence i n NPB
v
[Ainsworth, but a 'mere equity against anyone but a purchaser f o r value without n o t i c e , '
and n e i t h e r a r e g i s t r a b l e nor an o v e r r i d i n g i n t e r e s t ^ ^
17
The f a c t s of Hopgood v Brown
were t h a t two adjacent p l o t s of land were conveyed t o
one Turner by two conveyances, n e i t h e r of which precisely defined the boundary between.
jSventually the defendant held the southern p o r t i o n , and the northern p o r t i o n was held
by a company c o n t r o l l e d lij the defendant's f a t h e r , of which the defendant was a d i r e c t o r .
E^r agreement w i t h the company, the defendant b u i l t a garage, one w a l l of which would
i n e v i t a b l y form a boundary between the p l o t s . I n f a c t ' i t i s not possible to imagine
19
t h a t along s t r a i g h t l i n e s . '
and the garage encroached several f e e t on to the northern
iplot. P l a i n t i f f , as the company's successor, was estopped from claiming a wedge-shaped
piece of the defendant's garage by the compary's agreement w i t h the defendant.
'An
assignee of a lease i s estopped by the deed which estops h i s assignor.' ' I t would be a
jirery odd t h i n g i n the law of any countiy i f A could take, by ai^y form of conveyance a
FootnoteSI
;reater or b e t t e r r i g h t than he who
conveys i t t o him. •
(1965) AC1175* I n NPB v Ainsworth the mortgagee had no actual notice of the
occupancy.
45
I b i d pl223 per Lord Hodson. Curiously Lord Hodson admits t h a t the wife i s 'not a
person who needs any licence from her husband to be where she has a r i g h t to be as a
w i f e . ' (pl223). Had she been a licensee, she might perhaps have been able to take
advantage o f the p o s s i b i l i t y t h a t 'the l i s t of exceptions i s not closed' of
licences binding on t h i r d p a r t i e s .
16 •-• For an equity o v e r r i d i n g a Statute of Registrations. See White v NeayloE (1886)
IIACI7I. The Act f a i l e d to avoid o r a l contracts creating e q u i t i e s .
17
(1955) 1WLR213.
1|8
Per Mansfield C J i n Taylor v Needham (I8IO) 2 Taunt
1¥LR213 a t
1^
278 a t p283
c i t e d (1955)
p231.
(1955) 1 MR 213 a t p217
per Lord Evershed, M R.
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98
The case
seems t o
from the
the plan
(but)
i s not e s p e c i a l l y c o n t r o v e r s i a l , except t h a t the company's successor i n t i t l e
have been bound by the company's representation t o the defendant although
t i t l e deeds he would, on purchasing the property, have had no i n d i c a t i o n from
o f the encroachment. For the company 'did not make any express statements...
they d i d by t h e i r conduct i m p l i e d l y represent t h a t the defendant could safely
20
|proceed t o b u i l d as he planned. •
|of
That the purchaser i s bound by a representation
21
t h i s k i n d i s not i n a l l circumstances so e a s i l y acquiesced i n .
22
Plasticmoda Societa per Azioni v Davidsons (Ifanchester) L t d
was a sale of goods
case. The defendants agreed t o s e l l a q u a n t i t y o f cable strippings and to ship them
i n two instalments. Payment was t o be by confirmed l e t t e r of c r e d i t s Shipment was
ielayed and a time extension agreed, but the l e t t e r of c r e d i t was extended only f o r
,30 tons 'because we have the f e e l i n g t h a t you need more time than expected.. .and i t
• jould be of no sense t o l e t our money l a y i n g f o r several months a t the D i s t r i c t Bank
23
H a l t i n g t h a t the m a t e r i a l be ready f o r the shipment or wouldn't.'
I t was clear t h a t
ihe buyer was prepared t o increase the l e t t e r of c r e d i t . There was a long period of
delay and evasion by the S n g l i s h s e l l e r , and f i n a l l y the buyer sued. I n defence the
f e l l e r claimed t h a t i t was the buyer who was i n breach of contract f o r f a i l u r e t o supply
the
agreed l e t t e r of c r e d i t . The Court of Appeal had no d i f f i c u l t y i n f i n d i n g t h a t
''ithe s e l l e r by h i s conduct l e d the buyer to believe t h a t he would not i n s i s t on the
c r e d i t being established u n t i l the s e l l e r had t o l d the buyer that the goods were ready:'
t h a t i s , the defendant had l e d the p l a i n t i f f t o believe t h a t he would not i n s i s t on
his
s t r i c t l e g a l r i g h t s . I t i s an example of Spencer-Bower's 'minesweeper p r i n c i p l e . '
20
I b i d a t p230 per Morris, L J.
FootnotesJ
2}.
An i n t e r p r e t a t i o n of the case t o the e f f e c t t h a t the wedge-shaped piece of land
_was
simply not conveyed begs the question as t o why i t was not. The answer t o
t h i s c l e a r l y l i e s i n the representation made by the company p r i o r t o the
conveyance, which brings us back t o Mansfield's p o i n t .
2^
(1952) I I I Rep 527.
2:\
I b i d a t p531.
2ii
I b i d a t p538 per Denning, I . J.
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99
25 compensation
S i m i l a r l y , i n Tool Metal Manufacturing Co v Tungsten E l e c t r i c Co
payments were suspended. •::!SWE\ acquired c e r t a i n patents from the Osram company. TB^O
was observed t o be i n breach o f these patents, and negotiations followed, w i t h the
r e s u l t t h a t .TEGO was permitte'd-to continue operation, but subject t o a quota. Any
production i n excess of the quota was t o be accor^^anied by compensation payments t o
TMMj'i!;, agreed not t o enforce the agreement f o r compensation payments. . TECO took the
view t h a t compensation payments were t h e r e a f t e r 'washed out,' claiming that i t had
entered the f i r s t agreement w i t h
TMM3 under the delusion fostered by TMMD t h a t TECO
was being t r e a t e d i n t h e same way as other licensees o f TMM), and that these were the
best terms commercially possible f o r TMM3 t o grant. TECO issued a w r i t agains TMTC
on t h i s basis, and i n t h e i r counterclaim TMKD plea,ded 'the defendants do not wish t o
enforce payment o f compensation i n respect of d e l i v e r i e s made a f t e r 31st December 1939
but
before the end o f h o s t i l i t i e s w i t h Germany'^^ TECO's action was unsuccessful.
I n s o f a r as the counterclaim asked f o r compensation a f t e r t h a t time, the t r i a l court
|and the Court of Appeal applied Hughes and the Birmingham case, the only disagreement
^ e t w e e n them being as t o the manner i n which the suspensory period could be brought
bo an end. Since t h i s l a t t e r p o i n t was not before the court, the 195U Court o f Appeal
f e l t free t o disregard the e a r l i e r court's discussion. Romer, L J, i n whose judgement
the
others concurred, f e l t t h a t mequivocal notice was required ' i f the o l d terms were
27
bo be enforced again according t o t h e i r l i t e r a l provisions.'
28
He c i t e d CPR v R and
29
itoH'' V B e l l o t ! t i
f o r the p r o p o s i t i o n t h a t ' "Whether any and i f so what r e s t r i c t i o n s
footnotess
?5
(1951;) liJLR862 (CA), (1955)lWLR76l (HL). The f i r s t action and subsequent appealbby
TECO reported a t (1950) 69RPC108 was on the question o f misrepresentation by Krupps,
the
former owner of TM^C. The second a c t i o n and two appeals by TMMC were f o r claims
by TMM3 o f compensation. I t became r e l e v a n t then, although i t had not been so before,
to decide when the suspensory period had been ended.
is
(195U) 1WLR862 a t p870.
2:7
I b i d a t p878 per Romer L J, c i t i n g Somervill, L J i n ' p r e v i o u s appeal.
28
(1931) AC Um.
219
(1910;) KB 298.
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100
e x i s t on the power of a l i c e n s o r t o determine a revocable licence.. .depend(s) on the
circumstances o f the case,' The n o t i c e must be 'reasonable.'
The House of Lords f e l t t h a t the counterclaim was s u f f i c i e n t notice. Viscount Simonds'
view was t h a t e q u i t y d i d not r e q u i r e express notice t h a t the period of 'indulgence'
was over, e s p e c i a l l y since TMM3's a t t i t u d e 'could not surprise the respondents, who
had not h e s i t a t e d t o b r i n g against them a serious charge o f fraud.'^^ Further, ' I do
not wish,' he said, 'to lend the a u t h o r i t y o f t h i s House t o the statement o f the
p r i n c i p l e which i s t o be found i n Combe v Combe (ante) and may w e l l be f a r too widely
s t a t e d . . . I woiild not have i t supposed, p a r t i c u l a r l y i n commercial transactions, t h a t
J
mere acts o f indulgence are apt t o create r i g h t s , '•^•'' I t i s as doubtful whether he
would sanction the c r e a t i o n o f r i g h t s t y such means i n non-commercial transactions,
however, as i t i s curious t h a t he should so i n t e r p r e t Combe v Combe (ante).
32
[Gordon maintains
t h a t the suspensory e f f e c t o f the waiver was not given the a u t h o r i t y
Footnotess
30
(1955) 1WLR760 a t p76ii.
31
This q u o t a t i o n from Viscount Simonds seems t o form the i m p l i c i t centrepiece of
D M Gordon's a r t i c l e a t (1963) 01^22% a t p25l. Neither the a r t i c l e nor the
comment by Simonds i s p a r t i c u l a r l y s a t i s f a c t o r y . Gordon's main contentions seem t o
be t h a t courts have ignored the High Trees p r i n c i p l e ; t h a t High Trees owes nothing
t o Hughesj and t h a t t o support the concept underlying High Trees i s " next door t o
being 'Fundamentalists, whose creed i s t h a t a l l s t a t u t e s and law books should be
scrapped and replaced by the B i b l e . ' (p260). Presumably the same c r i t i c i s m can be
l e v e l l e d against eqiiity as a whole i n i t s o r i g i n s , and against Donoghue v Stevenson
f o r i t s discussion of neighbours.
Gordon f a i l s to understand the nature o f the l e g a l processj there i s no necessary
connection.between High Trees and Hughes, but t h i s i s not the same as saying t h a t
there cannot be a connection.(See
32
Stones Legal System
& Lawyers' Reasonings).
Op c i t p2J49s ' I n the r e s u l t a l l the courts made assumptions as t o r i g h t s t h a t may
not have e x i s t e d , and against r i g h t s t h a t probably d i d e x i s t , simply because those
were never canvassed by successful p a r t i e s . •
P T 0
101
of the House because i t was n o t disputed before the Houset he overlooks the p o s s i b i l i t y
t h a t i t was never questionned because i t s binding nature was a p a r t of commercial
'\ 33
mores.
The assumptions made by a l l three courts are s u f f i c i e n t t o ensure the s u r v i v a l
of the Hughes p r i n c i p l e and i t s a p p l i c a t i o n to the debtor-creditor r e l a t i o n s h i p , a t
l e a s t so f a r as i t remains a 'minesweeper' and does not presume t o be a 'capital unit.'"^^
Having ended the previous section w i t h the hunting e f f e c t o f Combe v Combe (ante) we
discussed i n t h i s s e c t i o n the extent t o which the decision i n Combe was consistent w i t h
t h a t o f F e r r i s v We a vena i t i s therefore apt t o end t h i s section tsj considering Ward
V %-ham^^ and i t s possibly l i b e r a t i n g e f f e c t . I f we approach Combe and Ward v ^ham
without a p r i o r i , l e g a l conception we f i n d a q u a l i t a t i v e s i m i l a r i t y . The facts of Ward
V i^yham are t h a t an unmarried couple had a c h i l d , and when i t was about h years o l d
the f a t h e r turned the mother out. The c h i l d was f o r a time looked a f t e r by a neighbour,
but then the f a t h e r consented t o the mother's having the c h i l d : he was t o pay £1 a
week t o the mother provided t h a t she looked a f t e r the c h i l d s a t i s f a c t o r i l y . She
promised t o do so, but l a t e r both married and the father ceased the payments. The
mother sued on the f a t h e r ' s promise to make the payments and the father argued lack
of consideration, the National Assistance Act 19U8'^^ placing upon a mother the duty
37
Df maintaining an i l l e g i t i m a t e c h i l d ,
A Reappraisal o f Quasi-Estoppel
f33
o o t n See
o t e sWilson:
:
(1965)GLJ93 a t p l l 3 . Also, ante.
Introduction.
See also l y l e - M e l l ^ v Lewis (1956) 1 A l l B R 2ii7 (CA) p l a i n t i f f granted a license
to manufacture a r t i c l e s which he had patented, t o the defendants. The defendants
d i d so, r e m i t t i n g t o p l a i n t i f f the sums due under the licence from time t o time.
They then repudiated l i a b i l i t y , p l a i n t i f f sued f o r the sums unpaid, and the
defendants were estopped from denying, as they sought t o do, t h a t the a r t i c l e s
wMch they manufactured were covered by the licence.
5
(1956) 2 A l l S R 318.
3|6
s i;2.
37
Presumably the term i n the contract r e q u i r i n g the mother t o allow the c h i l d t o
choose w i t h whom she would l i v e would be unenforceable: Hunphreys v Polak (1901)
2KB385.
"P T 0
102
Denning, L J, w i t h the agreement of Morris and Parker, L J J, based h i s decision i n
favour o f the mother on the e x p l i c i t assumption that a promse t o perform an e x i s t i n g
o b l i g a t i o n i s consideration. W h i l s t Combe involved a promise which chould not bind
the
promissor, so Ward v i^ham involved a promise t o do something which the promissor
was already bound t o do. I n other words, both promises are i n e f e c t u a l t o a l t e r the
status quo. They do not add t o the promissor's burdens; she has given away nothing
i n r e t u r n f o r the promise which she i n t u r n has received. I t i s as d i f f i c u l t t o share
Atiyah's approval o f the reasoning as i t i s easy t o concur i n welcoming the r e s u l t .
For the mother's promise t o maintain the c h i l d s a t i s f a c t o r i l y i s l e g a l l y onerous only
only i f one s t a r t s w i t h that which one i s required t o prove, namely, that the promise
'
38A
i s l e g a l l y binding, enforceable by the father.
I f the promise i s not actionable a t
the
s u i t o f the f a t h e r , there i s no burden on the mother. Implied i n the decision i s
the i n i t i a l presumption t h a t the mother's promise i s binding,' t h a t the father's promise
39
i s binding, and t h a t e i t h e r w i l l provide the promissee w i t h a cause o f action.
Footnotes5
38 A t i y a h : I n t r o d u c t i o n t o the law o f Contract 2nd ed p69. 'The statutory duty o f
maintaining the c h i l d i s only designed t o deal w i t h the duty o f supporting the c h i l d
as between the mother and the state, not as between the mother and the father,
hence the mother's promise i s , as between her and the father, a detriment t o her,
and a b e n e f i t t o him.'
.38A s U2 o f the I9U8 Act does not give a r i g h t o f action other than by the Board t o
recover p u b l i c money expended i n support o f the persons described i n subsection 1.
39
Parker & Morris, L J J f e e l t h a t the terms o f the l e t t e r iir?)ose an extra duty upon
the mother, namely t h a t o f keeping the c h i l d happy and w e l l looked a f t e r . How
convincing and r e a l i s t i c an extra burden i s this? See 72IdQRi;90. We cannot see how
performance o f a duty can constiute consideration by analogy w i t h a b i r d i n the
hand. Surely the b i r d i s already i n the hand i f a duly t o perform exists - unless
the
performance i s d i f f e r e n t i n kind, when there must be a new contract.
The other o f Cdrbin's arguments c i t e d i n the Note does not seem relevant t o a
discussion of Ward v ^ham. I n the non-commercial s e t t i n g of the case there was no
question o f the promissee's using her resources elsewhere, and paying damages f o r
breach o f the duty out o f the proceeds. Questions o f public p o l i c y (see Glassbrook
V Glams C C (1925)AC27Q) are subordinate, or i r r e l e v a n t t o the main issue o f whether
such promises are binding, and i f so why.
P T 0
103
There can be drawn no other conclusion than t h a t the law w i l l permit the enforcement
of g r a t u i t o u s promises, but t h a t , having decided to do so must f i r s t assume consideration;
the
l a t t e r may s i t e a s i l y or p e r i l o u s l y on the facts o f the case.
V42
I n Morrow v Carty^*^ the p l a i n t i f f successfully b i d f o r a bungalow t h a t was being
auctioned a t Cookstown. He f a i l e d to produce the amount o f the deposit, however, and
asked f o r an hour i n which t o go home and f e t c h i t . S i g n i f i c a n t l y the property was
not
sold u n t i l more than one hour had elapsed, the defendant's s o l i c i t o r considering
himself ' i n honour and l e g a l l y bound'^ not t o s e l l . Relying on Viscount Simonds'
i n t e i p r e t a t i o n o f Birmingham i n TMM3 v TECO (ante) McVeigh, J decided t h a t even i f the
p l a i n t i f f had returned w i t h i n the hour the defendant would not have been bound t o s e l l
the
bungalow t o him, f o r 'nothing was done by the vendor's s o l i c i t o r or t y the vendor
to cause tlie p l a i n t i f f t o a l t e r h i s p o s i t i o n t o h i s detriment. '^^ I n case t h i s ground
should prove u n s a t i s f a c t o r y , McVeigh, J added t h a t p l a i n t i f f ' s disingenuousness
f o r f e i t e d h i s r i g h t t o e q u i t y : he had not merely to go home t o c o l l e c t the deposit,
but
also t o e f f e c t a sale o f h i s stepfather's farm.'...Can he be heard t o invoke the
aid
o f equity?' The p r i n c i p l e i s only allowed i n where i t would be 'unjust' t o allow
1 "3
a p a r t y t o i n s i s t on h i s s t r i c t l e g a l r i g h t s . '
I t seems q u i t e clear that the f i r s t objection might not have been f i n a l had the second
been met."I''- have argued t h a t the essence o f equity remains ethics, and that i t
functions by r e s t r a i n i n g the enforcement o f s t r i c t l e g a l r i g h t s ; t h i s makes the second
o b j e c t i o n c r u c i a l , and quite independent o f the f i r s t . On the basis o f the reasoning
which; I r e j e c t e d i n r e l a t i o n t o Ward v E^^ham, and bearing i n mind the reference t o
advantage t o the proraissor i n Hughes^ a case f o r the promissee could surely have been
sustained. I t was w i t h o u t doubt an advantage t o both the vendor and h i s auctioneer
not
t o have t o r e s e l l the property: they might have received less favourable o f f e r s .
Footnotes:
ko
(1957) N i nh.
ig.
I b i d pl80:19.
k2
I b i d pl8l:23.
k3
I b i d , pl82:27.
kh
Lord Blackburn a t (1877 2 App Cas i;53,
c i t e d (1957) N I 182:39.
P T 0
loh
P l a i n t i f f ' s was, i n short, a b i r d i n the hand.
The t h i r d o b j e c t i o n , too, i s f a r from f a t a l t o the p l a i n t i f f ' s cause. The argument
t h a t equitable estoppel i s a s h i e l d only, and not a sword may be met by asserting t h a t
the p l a i n t i f f seeks s p e c i f i c performance of the contract w h i l s t the defendant i s
estopped from r e l y i n g i n h i s defence, on the o r i g i n a l terms of the contract.
Thus the a u t h o r i t y o f Morrow v Carty may be narrower than i t seems, prima f a c i e , t o be.
A l i b e r a l view was taken by Harman J i n C i t y of Meistminster Properties v Madd!f^ The
defendant antique dealer had l i v e d i n the basement rooms below h i s shop during the war,
as a safeguard against f i r e . He was granted a lease f o r three years, w i t h a covenant
not t o use the premises f o r any but business purposes, nor t o do anything which might
cause the premises t o be brought w i t h i n the Rent Acts. On h i s application f o r a
renewal there was some disagreement over the r e s t r i c t i v e clauses, but the court
accepted defence evidence t h a t the landlords agreed t o delete some p a r t of them, and
t h a t i n e f f e c t there was a promise t o the tenant t h a t i f he executed the lease, no
attempt would be made t o enforce the'shop-only' covenant against him. '...but f o r
the promise made he would not have executed the lease but would have moved t o other
premises available to him a t the time...There was a clear contract acted on by the
tenant to h i s detriment, and from much the landlords cannot r e s i l e ' ^ ^
Harman, J c i t e s Re W i l l i a m Porter (ante) i n support of h i s conclusions here however and i n r e l a t i o n t o Cairncross v Lorimer, a case r e l i e d upon i n Porter i t i s even more
30 - what i s being emphasised i s not consideration proper, but reliance upon a
:representation, the r e s u l t of which i s t h a t the promisee has put himself i n t o a
disadvantageous p o s i t i o n . This i s 'the doctrine.. .which i s to be found. . . i n the laws
) 7
o f a l l c i v i l i z e d nations,'
and t h i s , we consider to be the underlying reason f o r
the decision. The c r e a t i o n o f the c o l l a t e r a l contract i s unnecessary f o r i t neither
f i t s t r a d i t i o n a l nineteenth century contract dogma, nor accomplishes i t s objectives
I
Footnotesa
i5
(1958) 2 A l l E R 733.
k6
U7
I b i d p7 U3A.
I b i d C. from Cairncross- (l860) 3LT130 per Lord Campbell, L C.
P T 0
105
simply i n the present century^^
1x9
A gratuitous act was performed i n Schneider v S i s o v i t c h ;
P l a i n t i f f was i n j u r e d ,
w h i l s t i n France, by the defendant's negligent d r i v i n g , and her husband was k i l l e d .
Her Brother-in-law
and h i s wife flew out t o render her assistance. ' I f she had said
a t the time: ' i f you help me and save me the expense of h i r i n g services I w i l l repay
you your f a r e s ' there would have been a l e g a l l i a b i l i t y t o pay'^° and damages would
unarguably have had t o include an appropriate
sum f o r t h i s : a f o r t i o r i i f she had
a c t u a l l y h i r e d help. P a u l l , J held t h a t ' s t r i c t l i a b i l i t y i s not the b e - a l l and end-all
of a t o r t f e a s o r ' s l i a b i l i t y ' ^ • ' ' Damages ought t o include payment f o r services
g r a t u i t o u s l y rendered where t h e acts were reasonable and necessary as a r e s u l t o f the
t o r t f e a s o r ' s a c t i o n , and where the p l a i n t i f f undertook t o pay the volunteer. The
52
tenor o f Ifegarry's Note
i s c r i t i c a l , f o r 'English law has always drawn a s t r i c t
l i n e between acts done i n r e t u r n f o r a promise and acts done v o l u n t a r i l y . '^"^ l e t the
thaw of t h i s r i g i d , g l a c i a l approach i s t o be welcomed insofar as i t accords w i t h
r e a l i t y : the expense was incurred, and as a r e s u l t o f the tortfeasor's a c t . I t was not
unreasonable, and therefore t o s h i e l d the t o r t f e a s o r or h i s insurers behind a
t e c h n i c a l i t y seems q u i t e u n j u s t i f i e d . The implications f o r the equity which forms our
subject may seem s l i g h t , b u t we may discern i n Schneider the d i r e c t i o n i n which the
warmer currents are t r a v e l l i n g .
Footnotes:
^8
W h i l s t i t may 'enable s u b s t a n t i a l j u s t i c e t o be done' (Cheshire & F i f o o t : Contact
8th ed p56) i t does so w i t h some s a c r i f i c e o f convenience and r a t i o n a l i t y . Suppose
t h a t Mr Madd had a f t e r examining the lease revealed t o the landlord t h a t he was
l i v i n g on the premises, and the landlord had promised not t o enforce the covenants.
Mr Madd might as a r e s u l t have put himself t o considerable expense and d i f f i c u l t y ,
but the promise would have been gratuitous and thus unenforceable.
Quaere whether the o r a l v a r i a t i o n i s enforceable insofar as i t s objectives seem
t o be t o defeat r e n t r e s t r i c t i o n l e g i s l a t i o n .
Ji9
(1960) 2WLR169.
;;o
I b i d a t pl7U per P a u l l , J.
$1
I b i d pl76.
2
3
76LQRI87.
I b i d a t pl88. Quaere s u b s t i t u t i o n o f ' i s ' f o r 'ought'?
P T 0
106
The expression i n which Devlin J puts h i s s o l u t i o n of Parker v Clark^^ owes much t o
Hammersley v De B i e l (ante), t o the necessity f o r compensating p l a i n t i f f f o r h i s
r e l i a n c e upon the defendant's representation. I t i s a non-commercial s i t u a t i o n , and
one i n which bargain was not foremost i n the p a r t i e s ' minds. An o l d couple who l i v e d
i n a large house i n Torquay suggested t h a t a younger couple come t o l i v e w i t h them.
As an inducement sharing of the expenses was t o be on a basis favourable t o the younger
couple?^ Amid l a t e r acrimony,i jjhen the sum was offered, i t was refused?^ The p l a i n t i f f s ,
the younger couple, had i n d i c a t e d t h a t the contemplated move t o Torquay would
necessitate the sale of t h e i r Sussex cottage, and i n response the defendants promised
t o make up f o r t h i s by leaving a share i n the Torquay house t o the younger w i f e .
Devlin, J found t h a t the sharing arrangement was expected t o l a s t u n t i l the defendants'
deaths, but i n f a c t the r e l a t i o n s h i p became strained and p l a i n t i f f s were forced to
move out. I n r e l i a n c e on the defendants' representations p l a i n t i f f s had l e n t a
s u b s t a n t i a l p a r t o f the proceeds of the sale of t h e i r cottage t o t h e i r
daughter, t o enable her t o buy a f l a t , so t h a t t h e i r p o s i t i o n became d i f f i c u l t .
IjThere i s no doubt t h a t between the couples there was a contract. What i s s t r i k i n g i s
57
the reliance upon Synge v Synge/. and Hammersley, and the phraseology adopted, which
suggests t h a t an animal i s being considered whose t e r r i t o r y merely overlaps t h a t of
j o n t r a c t . I n Synge a 'proposal of terms was made as an inducement t o the lady t o
HO
inarrys'
i n Hammersley v De B i e l , Baron De B i e l was promised a sum of money by h i s
;^iture bride's f a t h e r , and, f o l l o w i n g the promise, the marriage took place. The word
59
'inducement' i s r a r e l y used i n r e l a t i o n t o contracts.
Generally an o f f e r o r
wishes
";o exchange a commodity which he possesses f o r one possessed by the offeree: i n no
footnoteSt
I'k
(1960) 1 A l l E R 93 see plOO.
5:5
I b i d p97D.
f6
I b i d p99A.
57
(1891;) 2QBl;62.
58
I b i d a t pl;69 per Kay, L J.
59
Except i n r e l a t i o n t o misrepresentation, perhaps.
P T 0
107
sense can, say, a vendor be said t o receive the purchase money as a compensation f o r
his l o s s , and the s u b s t i t u t i o n a l remedy of damages represents f o r the p l a i n t i f f a sum
equivalent t o t h a t which he would have had had there been no breach, not a coii?)ensation
f o r loss o f what he once had^^ Damages r e f l e c t - a c c u r a t e l y the nature o f the s i t u a t i o n .
I n Parker v Clark what the p l a i n t i f f expects i s not an advantage, but t h a t which w i l l
reveal t h a t i t i s not a case of contract proper: i t i s framed that way merely i n order
to place i t w i t h i n the known forms of action^'^'^ Again we are faced w i t h a bewitchment
by words.
The case o f Chalmers v Pardoe^"^ supplies an example of the f l e x i b i l i t y of the equity.
A F i j i a n Native Land Trust Ordinance
p r o h i b i t e d the dealing i n assignment or s u b - l e t t i n g
of property i n a n a t i v e land area except w i t h the consent of the Native Land Trust
Board - the lessor. The respondent was the assignee o f a lease held of the Board, who
enabled the appellant t o construct a house on a p a r t of the respondent's land, on the
Footnotes:
60
I n an a c t i o n i n t o r t , p l a i n t i f f seeks compensation f o r i n j u r y to an i n t e r e s t of
which he was possessed. The value o f what the v i c t i m has l o s t may o f course be
assessed by reference t o what he would have done w i t h h i s asset, e g i n j u r y t o a
p i a n i s t ' s hands by negligence o f t o r t f e a s o r , or loss o f an opportunity t o get a job
at an interview a t which the v i c t i m would have displayed h i s expertise. I n contract
he seeks compensation from the other contracting party f o r loss o f t h a t which the
other c o n t r a c t i n g p a r t y promised t o render him. One would thus expect t h a t damages
i n contract should be confined w i t h i n a narrower framework; and they are. c f
Hadley v Baxendale (l85i;) 9 JBX 3iaj Heron I I (1969)1AC350 w i t h Wagon Mound (No 1)
(1961) AC 388j Re Polemis (1921) 3KB560. See Lawson: Remedies i n English Law
ppl02 e t seq. Perhaps one could say without too much o v e r s i m p l i f i c a t i o n , t h a t
..damages i n contract look forward,. w h i l s t damages i n t o r t look backwards.
^OA
c f De l a Bere v Pearson (1908) 1 KB 280 w i t h Hedley E^rme (196U) AC li65j and see
the
41
comments of Lord Denning M R i n Letang v Cooper (1965) 1QB232 a t p239.
(1963) IWLR 677.
P T 0
108
understanding
t h a t the respondent would apply f o r permission t o sublet t o the appellant;
or else he would surrender his lease and enable the Board t o l e t the land t o the
appellant.
The r e s u l t of a q u a r r e l between the p a r t i e s was t h a t the respondent refused t o do
e i t h e r , and the appellant claimed on the basis o f 'the general equitable p r i n c i p l e
t h a t , on the f a c t s o f the case, i t would be against conscience t h a t Pardee should
r e t a i n the b e n e f i t o f b u i l d i n g s erected by Chalmers on Pardee's land so as t o become
a p a r t o f t h a t l a n d without repaying t o Chalmers the sums expended by him i n t h e i r
e r e c t i o n ^ ^ S i r Terence Donaldson, reading the judgement o f the J u d i c i a l Committee
agreed, c o n s i s t e n t l y w i t h cases c i t e d , notably Unity Finance v King, and Plimmer v
Wellington, t h a t 'unless there i s some special circumstance which precludes i t , equity
woTold intervene t o prevent Pardee from going back on h i s word and taking the buildings
'for nothing.'
However, there was a dealing i n the land which had not had the p r i o r
consent o f the Board, and f o r t h a t reason the equity would not operate. Since the
appellant d i d not have 'clean hands' i n the matter, i t was not unconscionable t o
v:
allow the respondent t o b e n e f i t . He could not e n l i s t the a i d o f equity i n an attempt
to- do what was u n l a w f u l ^ ^
.Smother case before the J u d i c i a l Committee o f the Privy Council i s less than free
from ambiguityt Emmanuel Ayodeji A j a y i v R T atscoe ( N i g e r i a ) ^ ^ 'The d i f f i c u l t y . . .stems
l..from the f a c t t h a t the equitable defence was never expressly pleaded.'^^ The
^^ootnotesi
^2
I b i d a t p68l.
63
I b i d a t p68U.
4it
Indeed, although i t was n o t suggested by the Privy Council, as a s o l i c i t o r Chalmers
must be taken t o have been aware of the Ordinance. The manoevre seems t o have been
designed t o avoid i t s e f f e c t and purpose - notably t o prevent land from being
purchased by those who d i d so i n order t o b u i l d without the consideration o f the
Native Land Trust Board.
65
(196U) IWLR 1326.
66
I b i d a t pl330.
P T 0
109
appellant bought a number of trucks from the respondent under a h i r e purchase agreement.
They were not e n t i r e l y s a t i s f a c t o r y and the respondent agreed not to i n s i s t on
payment o f the instalments w h i l s t they were 'withdrawn from active service.' Although
the r e p o r t i s not c l e a r , i t appears t h a t the instalments were not paid even a f t e r
the trucks had been repaired, so t h a t the l e t t e r suspending the o b l i g a t i o n could hot
be r e l i e d upon t o provide an equitable defence t o the a c t i o n f o r payment.
Since the f a c t s r e l i e d upon i n d i c a t e e i t h e r the appellant's lack of clean hands, or
a t l e a s t h i s f a i l u r e to support h i s a l l e g a t i o n s , the comments of Lord Hodson, reading
the judgement of the Board, must be taken t o be o b i t e r i n s o f a r as they r e l a t e to the
equity. His i n t e r p r e t a t i o n of the Hughes p r i n c i p l e i n the l i g h t of TMM3 v TECO i s
innocuous enoughs p l a i n t i f f , he said, must have a l t e r e d h i s p o s i t i o n i n reliance upon
I
iihe representation, and only i f i t i s not possible f o r him to regain h i s o r i g i n a l
I p o s i t i o n w i l l the concession made i n the representation achieve permanent e f f e c t .
A more u s e f u l case, and i n view of the pleadings submitted to the J u d i c i a l Committee
68
i n A j a y i v Briscoe, a more a u t h o r i t a t i v e , i s Inwards v Baker.
At h i s father's
suggestion, the defendant b u i l t a bungalow on a piece o f h i s father's land i n
liijhen h i s f a t h e r died i n 1951,
under a w i l l of 1922
1931-
( i e before the land had been
acquired by the f a t h e r ) most of the property was l e f t to the father's mistress and
the two c h i l d r e n of t h a t union. No dispute w i t h the defendant arose, and he
continued
t o occupy the bungalow u n t i l I963 when proceedings were commenced to remove him.
P l a i n t i f f ^ ' r e l i e d upon analysis of the nature of the defendant's i n t e r e s t i n the land,
which they s a i d was a l i c e n s e . I n order t o be irrevocable i t would, they alleged,
need t o be supported by a contract, and since there was no contract here, the licence
could be, and had been, revoked. As i n e a r l i e r cases i n which acceptance by the cciirt
of a narrow a p r i o r i conceptualization of the license would have j u s t i f i e d an
unmeritorious pleading, the Court of Appeal here permitted the equity of the r e s u l t
Footnotes:
67
A t PI33O. The a l t e r a t i o n of p o s i t i o n need not, on t h i s view, be request>ed by the
promissor. See A t i y a h : Consideration i n Contracts: A Fundamental Restatement at
ppi;6-U7 e t seq.
^8
,^1965) 1 A l l . E R iii;6.
P T 0
110
t o subordinate the t e c h n i c a l i t y . Ample a u t h o r i t y was available f o r the assertion 'that
i f an owner o f land requests another, or indeed allows another, t o expend money on
the land under an expectation created or encouraged by the l a n d l o r d t h a t he w i l l be
allowed t o remain there, t h a t raises an equity i n the licensee such as t o e n t i t l e
him t o stay^^ Further, Lord Denning suggested, n o t only were s u c c e s s o r s - i n - t i t l e such
as the father's n a t u r a l sons, bound
the equity, but so too would be a purchaser
w i t h n o t i c e . The obvious l i n k w i t h equitable estoppel was recognised by Danckwerts,
71
I n Ward v K i r k l a n d , w h i l s t TJngoed-Thomas, J d i d not take Inwards v Baker 'to establish
t h a t an incitement or request...was an e s s e n t i a l ingredient before the equity can be
created...as contrasted w i t h standing aside w i t h knowledge o f expenditure by a
72
claimant' • he acknowledged t h a t such a request would raise the equity. The issue
before the judge concerned, i n t e r a l i a , the l a y i n g o f some drains by the p l a i n t i f f
i n some a d j o i n i n g land. At the time the drains were l a i d the defendant was tenant,
and a r e c t o r the fee siii?)le owner, o f the adjoining land. The rector's consent t o the
tenporary l o c a t i o n o f the drains was not a d i s p o s i t i o n which would have required the
consent o f the E c c l e s i a s t i c a l Commissioners, but the p l a i n t i f f ' s expenditure constituted
'the subsequent a c t i o n which converts.,what i s done i n t o an equity o f which t h i s court
E
ootnotest
9
I b i d a t pi|.l;8G. Per Lord Denning, M R from Ramsden v Dyson (though the remarks were
o f course o b i t e r ) i t seems clear t h a t f o r the landowner merely t o allow a p l a i n t i f f
to expend money on the land would be s u f f i c i e n t encouragement, unless the landowner
were ignorant, i n which case he could hardly be said t o 'allow' the expenditure.
See (1866) LR 1HIJ.29 a t pllp. per Lord Cranworth.
1^0
I b i d a t plU;9I. Whether estoppel or equitable estoppel i s the more apt i t i s
unnecessary t o decide i n view o f Ramsden, but i f i t were necessary, the substance
o f the representation by conduct would be o f an i n t e n t i o n ( i e not t o d i s t u r b ) ,
cf Piggott V Stratton (ante).
71
(1966)1 A l l 1 R 609.
72
I b i d a t p625H.
P T0
Ill
would take cognizance.' 73 Although the r e c t o r could not have granted h i s irrevocable
consent without obtaining t h a t o f the Commissioners, the same e f f e c t as i f he had
been able t o give such consent was r e a l i s e d i n equity once the p l a i n t i f f had expended
money i n constructing the drains, f o r equity fastens 'on the conscience of the fee
simple owner.' As successors i n t i t l e , the defendant was.bound l y the consent: 'the
expense was i n c u r r e d by the p l a i n t i f f on the- footing and i n the b e l i e f and con-vlction
t h a t he had permission properly granted by the r e c t o r f o r p u t t i n g d r a i n there f o r an
i n d e f i n i t e time...so t h a t the r i g h t t o the equity t o have the drains there i s
75
permanent.'
To
o-Tercone
the d i f f i c u l t y t h a t the consent r e l a t e d only to the discharge
of bathwater through the drains, a i d not t o the discharge of e f f l u e n t from the two
water closets i n s t a l l e d by the p l a i n t i f f , the judge refused an i n j u n c t i o n to r e s t r a i n
the
trespass involved i n the l a t t e r a c t i v i t y on the ground that ' i f a trespass i s
' t r i - y i a l an i n j u n c t i o n may not be granted.'
The Rams den v DSrson p r i n c i p l e , creating an equity binding a landowner who acquiesces
77
i n expenditure by another on h i s land was extended by Ives v High,
beyond Inwards v
Baker. Here, the expenditure by the other was on h i s own land, but induced by the
promise of t h e adjoining owner's predecessor i n t i t l e t h a t a r i g h t of way would e x i s t
over the adjoining land. The defendant. High, b u i l t a house on a bomb-site. On the
Footnotes:
73
I b i d a t p626B.
1\x
c f the Lever Finance case (post).
75
(1966) 1 A l l
E R 609 a t p626l. Note, then ( i ) t h a t the promise i s enforced a t the
s u i t o f the promissee; and
( i i ) t h a t the equity affords more than
mere teirporary r e l i e f .
This i s the message o f t h i s l i n e o f
cases.
.'
For the-sugg'estion t h a t the development o f the enforcement of promises i n t h i s way
u t i l i s i n g the concept o f equity, i s more convenient than the argument advanced by
A t i y a h (see Consideration i n Contracts), see l a t e r .
6
,7
I b i d a t p627B. The judge c i t e d Armstrong v Sheppard (1959) 2 A l l E R 651 i n support.
(1967) 1 A l l E R 501;.
p T0
112
neighbouring s i t e one Westgate. began b u i l d i n g a block of f l a t s whose foundations
encroached on High's land. Instead of r e q u i r i n g Westgate t o remove the foundations,
as he would have been, e n t i t l e d t o do. High agreed t o t h e i r remaining, subject t o h i s
being allowed access to h i s house by car over Westgate's land. Westgate sold t o Wright,
who watched High construct a garage on h i s own land, the only access t o which was over
Wright's land. Wright sold by auction to the p l a i n t i f f s who had knowledge of the
i n f o r m a l agreement between High .and Westgate. The 'Court of Appeal found i n the
defendant's favour on two bases; f i r s t t h a t o f mutual b e n e f i t and burdenj^ and second
t h a t of acquiescence by the p l a i n t i f f .
From an a n a l y t i c a l viewpoint, a d i f f i c u l t y arises out of the second basis. Any i n t e r e s t
i n land which the defendant obtained by the informal agreement should, i f i t were t o
bind the p l a i n t i f f , have l^en r e g i s t e r e d , under the provisions of the land Registration
79
|Act 1925.
The argument of Lord Denning, M R
depends f o r i t s e f f i c a c y upon there
8o
jbeing 'an equity a r i s i n g out o f acquiescence.' I n the words of Danckwerts, L J
' Mr Westgate acquiesced i n the use o f the yard f o r access and the Wrights stood by
knd, indeed, encouraged the defendant t o b u i l d h i s garage i n these conditions and
i
.?or these purposes. Could a i y t h i n g be more monstrous and inequitable (than) afterwards
•;o deprive the defendant o f the b e n e f i t of what he has done?' The ,'right' possessed
by High i s not an i n t e r e s t i n land unforeseen by the l e g i s l a t u r e i n 1925^
but an
equity which achieves the saiiB end, much as the d i s p o s i t i o n by the r e c t o r i n Ward v
i n d i n g not
would
the proroissee
has the
reasonably
r e l ionce
ed
Isny
i r k lother
a n d , fthough
a d produce
i s p o s i t i io nn e qr ue iq tu yi ir i nonce
g consents,
achieved
same object
i.pon the promissor's representatipn the promissor may not withdraw.
Such an i n t e r p r e t a t i o n ! i n t e l l i g i b l e i n the l i g h t of, i n t e r a l i a , Hohfeld's analysis
f the equity-law r e l a t i o n s h i p subsequent t o the dispute between Sllesmere and Coke,
8l
whose s o l u t i o n was r e i t e r a t e d i n 1875^
renders otiose any search f o r the precise
Footnotes1
78
On the a u t h o r i t y o f H a l s a l l v B r d z e l l (1957) 1 A l l E R
7p
(1967) 1 A l l E R 501; a t p508B.
83
I b i d a t p5l0I.
81
I b i d a t p5li; G.
371-
P T 0
]
.
•
lature of the proinlssee's i n t e r e s t ? ^ I t i s puzzling t o f i n d ¥iim L J remarking t h a t
•...the promissee...is not asserting any p o s i t i v e r i g h t s , but i s invoking law or
j q u i t y t o a f f o r d him procedural p r o t e c t i o n t o avert i n j u s t i c e , *
when i t seems clear
that the promissee i s indeed asserting a p o s i t i v e r i g h t , namely t h a t e n t i t l i n g him
bo equitable i n t e r v e n t i o n on h i s behalf.
A possible explanation o f Winn L J's
statement i s t h a t the equity t h a t may be invoked i n any p a r t i c u l a r case depends
(3ntirely
upon the circumstances o f the p a r t i c u l a r case: the equity may f a i l the
])romissee i f he f a i l s equity.
That equily works by r e s t r a i n t upon common law r i g h t s
86
does n o t make i t less o f a p o s i t i v e remedy.
[^he capacity o f the equity t o create an o b l i g a t i o n outside the context o f land
i,ransactions and i n the absence o f a p r e - e x i s t i n g contractual r e l a t i o n s h i p i s
j . l l u s t r a t e d by Durham Fancy Goods v Jacksont
as we have suggested, the equity i s
88
V i d e r than contract, and as both Gombe v Combe and D & C Builders v Rees i n d i c a t e ,
89
i t i s more f l e x i b l e than the t r a d i t i o n a l doctrine o f contract, although, as Atiyah
argues, the courts f i n d ways which are as e f f e c t i v e as t h a t o f the equity, o f refusing
Kootnotess
82
And i n ¥ard v Kirkland the promissee i s the p l a i n t i f f .
83
See e g D & G Builders v Rees ( p o s t ) .
84
Supreme Gourt of Judica|ive Act 1875 s 25(11).
8^
Thus s p e c i f i c performance may be analysed as a r e s t r a i n t upon the common law
r i g h t t o tender damages i n l i e u of performance, but nevertheless
quite r i g h t l y
i t i s regarded
as the most p o s i t i v e and d i r e c t method o f enforcing a contract.
86
c f the use made o f another equitable concept, the t r u s t , i n the l a t e r cases.
87
(1968) 2 A l l S R 987.
88
(1966) 2 QB 617.
89
A t i y a h : Gonsideration pp5-9.
P T 0
:
m
90
to
enforce contracts prima f a c i e v a l i d .
I n D & C Builders T Rees, the respondent
o f f e r e d and the appellant accepted, a smaller sum i n s a t i s f a c t i o n of a contract debt.
Knowing t h a t the appellant b i i i l d e r s were i n f i n a n c i a l d i f f i c u l t y i the debtor had
threatened't'Q make no payment a t a l l i f the sum offered were not accepted, and f o r
t h i s reason, Lord Denning, said, the b u i l d e r s were not precluded from enforcing t h e i r
91
s t r i c t l e g a l r i g h t s and suing f o r the balance.
I n Durham Fancy Goods t h e p l a i n t i f f s drew a b i l l on the defendants whose 'nomenclature
at any p a r t i c u l a r p o i n t o f time was f o r t u i t o u s and devoid of significance t o anyone
92
ccncemed.'
The company secretary of Jacksons L t d accepted the b i l l , signing, on
behalf o f the coiapaiiy under the name of 'M Jackson (Pancy Goods) L t d , Manchester.'
Before the b i l l had matured the corpany was i n d i f f i c u l t i e s , and the b i l l was
Footnotes!
?0
Atiyah r e f e r s t o the necessity of an ' i n t e n t i o n t o create l e g a l r e l a t i o n s '
•:. _
_
'". '
'..
"" - the p o l i c y adopted by the courts so as t o
leave c e r t a i n areas, i n F u l l e r ' s words 'law-free' e g social arrangements,
arrangements between husband and w i f e made during an amicable phase of the
marriage, c f Balfour v Balfour (1919)
w i t h M e r r i t t v M e r r i t t (1970)
2 A l l E R 760 c f also gdwards v Skyways (l96k)MLR 3h9 w i t h Jones v Padayatton
(1969) IHLR 328. I n the l a t t e r case, serious i n j u s t i c e seems t o have occurred,
however, p r e c i s e l y because of the inadequacy of the common law, expressing
i t s e l f through the ' t r a d i t i o n a l ' law o f contract, i n f a i l i n g t o adapt t o the
p a r t i c u l a r circumstances o f the case.. Common law attempts t o achieve p a r t i c u l a r
-ijixstice'always s u f f e r from t h e i r concealment behind a vest o f g e n e r a l i t y , so
t h a t the p o l i c y and substance o f the decision i s misunderstood l a t e r .
9(1
I n allowing the appellant t o r e l y on the so c a l l e d 'rule i n Pinnel's Case' i e
applying the common law and ignoring the equity, the majority of the Court of •
Appeal were i n e f f e c t achieving the same o b j e c t i v e , and taking the same a t t i t u d e
towards an unmeritorious defence. The drawback o f t h i s approach i s the same as
we have already noticed i n r e l a t i o n to Jones v Padayatton.
9i
(1968) 2 A l l S R 987 a t p988 per Donaldson J.
P T 0
dishonoured. '...Neither the p l a i n t i f f s (nor) Jacksons, nor Mr Michael Jackson had
ever given a thought t o section 108 of the Conpanies Act 19U8
even heard of i t . * But, 'exercising t h e i r new
if...;any of them had
found knowledge V of the law,' the
p l a i n t i f f s sought- t o make Michael Jackson personally l i a b l e on the b i l l on the grounds
t h a t he had accepted i t containing an unregistered variant of h i s comparer's name?^ The
p l a i n t i f f s had not objected t o the v a r i a n t , so t h a t although Donaldson J had 'no doubt
9li
t h a t he i s l i a b l e t o the p l a i n t i f f s.. .because t h i s i s what the Statute says,'
he
sought t o prevent the p l a i n t i f f s from enforcing the l i a b i l i t y . He accon^lished
this
by r e s o r t to Lord Gaims' ' f i r s t p r i n c i p l e . '
Once the e s s e n t i a l u n i t y of the Cairns p r i n c i p l e and t h a t t o be found i n Ramsden v
Dyson has been recognised, the necessity f o r a pre-existing contractual r e l a t i o n s h i p
disappears, and we suggest t h a t Durham Fancy Goods i s best seen i n t h i s way. I t was
s u f f i c i e n t , to prevent the enforcement of section 108, t h a t there should be a
''pre-existing l e g a l r e l a t i o n s h i p . ' That the decision should be based upon the equity,
and t h a t i t should be explained as functioning i n t h i s p a r t i c u l a r way i s a useful
h e u r i s t i c device, but t h i s h e u r i s t i c convenience should not obstruct r e a l i s t i c
analysis of the equity's substance. I t has substantive e f f e c t , and to view i t other
than as a substantive doctrine could lead to a r b i t r a r y and uncertain r e s u l t s .
Section 108 of the Companies Act i s q u i t e clear and does not appear t o allow the
remedy provided f o r the defendant by Donaldson, J.
The equity seems t o have operated
Footnotes:
93
I b i d p990F.
That v a r i a n t had of course been placed on. b i l l by the drawer, so t h a t although
t e c h n i c a l l y M Jackson had accepted i t , he had been i n v i t e d to do so by the p l a i n t i f f .
Had t h i s not been the case, quaere whether the decision might not have gone the
. other
^5
way.
The m a t e r i a l p a r t , set out a t (1968) 2 A l l S R 987 a t p989i; i s as f o l l o w s : (Subs k)
' I f an o f f i c e r of the company...b) signs...on behalf of the company any b i l l of
^exchange.. .wherein i t s name i s not mentioned i n the manner aforesaid.. .he...shall...
be personally l i a b l e to the
holder...'
PTC
116
outside and against the s t a t u t e ? ^
97
I n Lever (i^nance) L t d v Westminster Corporation
the appellants submitted a plan
w i t h t h e i r a p p l i c a t i o n f o r planning permission i n order t o b u i l d fourteen dwelling
houses i n St John's Wood. Permission was granted by the respondent a u t h o r i t y on the
basis of the plan, b u t s l i g h t v a r i a t i o n s were subsequently made from t h i s plan, the
r e s u l t o f which was t h a t one o f the new houses was much closer t o some e x i s t i n g houses.
The amended plan was sent t o the a u t h o r i t y but was l o s t by them, so t h a t when a
jielephone c a l l was made t o a s c e r t a i n i f 111e a l t e r a t i o n s were material the l o c a l
a u t h o r i t y servant who answered r e p l i e d t h a t they were not. Later, the planning committee,
f i n d i n g t h a t the a l t e r a t i o n s were m a t e r i a l , refused consent. The Court of Appeal
decided t h a t the a u t h o r i t y was bound by i t s o f f i c e r ' s assurance t o the appellants:
go
[although i t had no power t o delegate,
i t was bound by the unauthorised statement of
i t s servant once t h i s had been acted upon by the appellant.
We have already suggested t h a t the width and d e t a i l o f administrative controls renders
unreal the requirement t h a t an i n d i v i d u a l should i n v e s t i g a t e the regulations authorising
such controls where an o f f i c i a l gives an assurance which there is.reasonable ground
jfor a c t i n g upon, the assured, o r promissee, should not s u f f e r f o r h i s reasonable
99
reliance. This contention receives support from developments i n the sphere o f coinpany law.
1?6 As, o f course, the equity o f p a r t performance d i d i n r e l a t i o n t o the Statute of
Footnotes:
Frauds.
91
(1970) 3 A l l S R U96. c f Norfolk C C v Secretaiy o f State (1973) 3 A l l E R 673.
Planning a u t h o r i t y not bound here because e r r o r r e c t i f i e d i n time.
!?8
U n t i l t h i s power was conferred by the Town & Country Planning Act 1968 s6i; the
a u t h o r i t y d i d not delegate i n w r i t i n g pursuant t o t h i s Statute i n any case.
$9
See the m a t e r i a l c i t e d ante. A d d i t i o n a l l y Farrar & powleB: The E f f e c t o f Section 9
o f the European Companies Act 1972 on English Coii?)any Law 36 MR 270.
P T0
117
and from Robertson's case (ante), as w e l l as from Lever (Finance) v Westminster. The
l a t t e r case may decide more than t h a t ' i f an o f f i c e r acting w i t h i n the scope of h i s
ostensible authority"^^*^ makes a
representation
on which another acts, then the public
a u t h o r i t y may be bound by i t . . . ' Lord Denning a t l e a s t (with the concurrence of Ifegaw,
L J ) , f e l t t h a t 'considerable reserve' ought henceforth t o be placed on the cases
deciding t h a t an a u t h o r i t y 'cannot be estopped from doing i t s public duty.
I t
102
would be a p i t y i f the case merely 'extended the category of t e c h n i c a l i t i e s
upon
which an a u t h o r i t y was estopped from-relying, beyond the M e l l s case, and I suggest
t h a t herein l i e s the value of Lord Cairns' p r i n c i p l e .
Planning l e g i s l a t i o n i s concerned w i t h adjusting c o n f l i c t i n g i n t e r e s t s and courts are
r e l u c t a n t o v e r t l y t o enter t h i s arena"^^"^ when controversy appears l i k e l y . I t i s scarcely
Footnotes:
100 Evidence was given t h a t i t i s normal practice f o r minor a l t e r a t i o n s i n plans to be
accepted by planning o f f i c e r s , though the o f f i c e r 'should always say " I n ny opinion
i t i s not material"*(1970) 3 A l l E R i;96 a t p^OOB per Lord Denning, M R. (Hence the
change accomplished by the 1968 A c t ) .
:L01
I b i d a t p^OOH. He saw Lever (Finance) as extending ffells v M ,HiL G (1967) 2 A l l E R
IOI4.I. Here the applicants sought t o e r r e c t a plant f o r manufacture of concrete blocks,
and were informed by Leatherhead UDC t h a t since t h i s was w i t h i n the e x i s t i n g use
Class, only byelaw consent was required. A f t e r the plant was f i n i s h e d an enforcement
notice was served by the UIX), because the plant was higher than the applicants had
stated. Held, t h a t the decision t h a t planning permission was not required was
i r r e v o c a b l e : the a u t h o r i t y could be 'estopped from r e l y i n g on t e c h n i c a l i t i e s ' (at
plOUliF): c f Norfolk C C v Sec of State op c i t n97 per Lord Widgery, C J: HiJhat one
hopes t o achieve i n a s i t u a t i o n l i k e t h i s . . . i s t h a t everybody s h a l l end up i n the
p o s i t i o n i n which they would have been had the mistake not been made,' p677F.
]l02
Evans: Note on Lever (Finance) L t d 3kMR33^ a t p339.
I
1)03 N a t u r a l l y , since i t i s inherent i n the f u n c t i o n of courts, they do so, and the
curious f a t e of the Race Relations & Immigrant l e g i s l a t i o n a t the hands of the
House of Lorxis indicates t h a t t h a t House i s not averse to imposing i t s views
despite s t a t u t o r y wording.
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s u f f i c i e n t t o state b a l d l y t h a t developers should not s u f f e r from the mistakes o f
l o c a l a u t h o r i t y servants^^^ f o r as a generalisation i t i s as urgent t h a t l o c a l
residents and others f o r whose b e n e f i t planning l e g i s l a t i o n exists]"^^ should not s u f f e r .
106
I f the courts are going t o i n t e r f e r e a t a l l - and I consider, w i t h Jaffe
t h a t both
courts and l e g i s l a t u r e have equal and coextensive r e s p o n s i b i l i t y f o r e f f e c t i v e
lawmaking, and so they should i n t e r f e r e - then they must not be blown by capricious
eddies and gusts o f t e c h n i c a l i t y . An e q u i t y i s required which w i l l r e s t r a i n the granting
of an enforcement n o t i c e except where i t would be j u s t and equitable. Generally, since
the
developer has r e l i e d upon the representations o f the l o c a l a u t h o r i t y through i t s
servant, the simplest and cheapest remedy i s t o r e s t r a i n the r i g h t s which the l o c a l
a u t h o r i t y would otherwise have, but i t i s not d i f f i c u l t t o envisage a s i t u a t i o n i n
|which a s t r u c t u r e i s seriously deleterious t o amenity. The s o l u t i o n i s not to pretend
107
|that the merits have changed,
or t o penalise l o c a l inhabitants, but t o remove the
•offending b u i l d i n g and con?)ensate the developer f o r h i s loss of profit'l''^'^''^ I t i s
doubtful i f t h i s degree of f l e x i b i l i t y could be achieved on any but equitable p r i n c i p l e s
• j i t h o u t the attendant danger o f excessive convolutions c e r t a i n l a t e r to be misunderstood.
; ^ u a l l y o f the present as o f the eighteenth century we have suggested, i t i s true
ihat 'equity l e f t i n t a c t . . . common law rights...and merely made i t . . .impossible t o
])ursue them. ..and was subjecting p o s i t i v e law t o the t e s t of morals quite as much as
Jias
n a t u r a l law. The main d i f f e r e n c e . . .was t h a t the former refrained from formulating
:.Oii
(1970) 3 A l l iS R h96 a t p^OlG per Lord Denning.
ootnotesj
4.05
One looks i n v a i n , both i n the judgements and i n Bvans' learned note f o r a
r e c o g n i t i o n t h a t t h i s i s what planning l e g i s l a t i o n i s about.
106
Jaffes English & American Judges as Lawmakers.
107
Assuming t h a t the developer acted on the representation of the l o c a l a u t h o r i t y ,
p
and assuming also, perhaps, t h a t he could not himself have foreseen damage t o
amenily.
107A As t o the measure o f damages by way o f compensation see Wroth v Tyler (1973)
1 A l l B R 897 a t p921 per Ifegarry J; Grant v Dawkins (1973)3 A l l E R 897 a t
p900, per Goff, J f o r the equitable r u l e .
P T 0
119
i n advance the assumptions on which ( i t ) proceeded' - though system may a t times be
discerned. Both an equitable type o f contract and the licence have been used as
devices f o r achieving equity between promissor and promissee. More recently the t r u s t
has been resurrected as an instrument o f innovatory j u s t i c e . However, as I have
ventured e a r l i e r , although f o r the observer an understanding o f the way i n which the
law i s changing may be gained by the use o f s t a t i c concepts, i t should not be assumed
t h a t the s t a t i c concepts describe the law exclusively. EJy a process o f analogy o l d
concepts are put to new uses, and a t the adventurous extremes, t h a t i s t o say where
change occurs as a single step r a t h e r than as many small ones, the process may be
termed l e g a l f i c t i o n . The concepts are t o o l s and as such are subordinate t o the end
we wish t o achieve. They do not define or l i m i t the ends sought, but t h i s i s not easy
to see because the s t a b i l i s i n g f a c t o r i s t h a t both the ends and the concepts are
109
products o f what those who operate the l e g a l system
consider t h a t i t ought to be
ichieving. The l e g a l mind may be too prepared t o f i n d a causal l i n k where there i s
lone, p a r t i c u l a r l y where t h i s conceals a possible value o r i e n t a t i o n ,
phus, w h i l s t i t i s u s e f u l t o attempt exhaustive definition"''''"^ i t must be remembered
•ihat such d e f i n i t i o n i s an h i s t o r i c a l statement and should not hinder growth i n a
dynamic system. I t s proper f u n c t i o n Is, "by i n d i c a t i n g past development, t o point out
J'uture p o s s i b i l i t i e s .
] h Binions v Evans'^"'" Mrs Evans' husband had worked f o r Tredegar Estates a l l h i s l i f e ,
i f t e r h i s retirement, an arrarjganent was entered i n t o by which he, and h i s wife i f
£he survived him, might remain i n t h e i r cottage free of r e n t , subject t o four weeks'
notice on t h e i r p a r t i f they wished t o terminate the arrangement. The agreement would
no doubt bind the p a r t i e s t o i t , f o l l o w i n g Foster v Robinson, but unfortunately t h i r d
Jootnotes:
108 Stone: Human Law & Human Justice p78.
109 . I n the widest sense - i e society a t large t o the extent that s o c i a l expectations
!
i
110
mould the law, p r a c t i t i o n e r s and o f f L c i a l s , as w e l l as judges and l e g i s l a t o r s .
See, e g the discussion o f licences by Megany, J i n Hounslow v Twickenham Garden
Developments L t d (1970) 3 A l l E R 321;.
111
(1972) 2 A l l E R 70.
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p a r t i e s became involved when Tredegar Estates sold the property concerned to
Mr and Mrs Binions. I t was admitted t h a t they had notice of the agreement between
the vendor and Mrs Evans, and f o r t h i s reason 'there i s no doubt that...they paid a
reduced p r i c e f o r the cottage.'"^^ I n NPB v Ainsworth^-^ a mortgagee who had no notice
o f the wife's occupancy of tiiematrimonial home was able t o take free of i t f o l l o w i n g
the f a i l u r e o f the mortgagor conpany, which was c o n t r o l l e d by the husband, and to
!which the husband had conveyed the property. Megaiwy and Stephenson L J J, i n Binions,
p r e f e r r e d t o grant a remedy to Mrs Evans, though t h e i r mode of doing so d i f f e r e d
from t h a t of lisrd Denning, M R, the t h i r d member of the Court of Appeal. His view was
t h a t a c o n t r a c t u a l l i c e n c e , which 'the courts of equity w i l l not allow the landlord
t o . . .breach.. .nor the purchaser i f he bought w i t h knowledge of her r i g h t ' was the
b e t t e r s o l u t i o n s ^ t h e i r s was t h a t Bannister v Bannister"'"''^ enabled them to confer
Footnotes:
112
|113
Op c i t p73 per Lord Denning, M R.
(1965)AC1175. Had the decision gone the other way the bank would scarcely have been
ruined, and the w i f e would have had somewhere to l i v e . I n an era of housing
shortages the decision shews the usual s o c i a l nyopia of the House o f Lords.
Mortgagees could have guarded against the s i t u a t i o n by inspecting the premises, and
the w i f e would moreover have received notice of the husband's i n t e n t i o n s w i t h
respect t o the matrimonial home.
The House's concept of i t s own r o l e seems somewhat l i m i t e d , and i t s plea f o r
l e g i s l a t i v e i n t e r v e n t i o n on the one hand o p t i m i s t i c (See Blom-Cooper & Drewrys
F i n a l Appeal p209. Of li; cases i n which such a plea was expressly made ' i n only seven
...was there a d i r e c t response t o the c a l l f o r reform'), and on the other naively
confident i n the effectiveness of Parliamentary draftsmen, already overaorked by
v i r t u e of Government l e g i s l a t i v e programmes. See Adams: Wroth v Tyler and the Measure
o f Damages LSG 13th June 1973 p l 9 l 8 . See- also the comments of Msgarry, J i n t h a t case
(1973) 1 A l l E R 897 a t p925D. 'The Act c e r t a i n l y changed the law; but not every
change i s reform.'
ikk
(1972) 2 t a . B^R-70 a t p75D.
11$
(I9it8) 2 A l l E R133.
A case i n which the purchaser was held to be a trustee of
property during the l i f e of the vendor, and f o r her b e n e f i t , so as t o prevent him
from using siiO as an engine o f fraud. Equity, i n other words, i s acting t y p i c a l l y ,
e s t a b l i s h i n g a p o s i t i v e i n t e r e s t by r e s t r a i n i n g the use o f common law remedies.
P T 0
121
upon her a l i f e i n t e r e s t .
The d i f f i c u l t y i n the l a t t e r s o l u t i o n i s t h a t 'a tenant f o r l i f e under (the law of
Property Act 1925) has power t o s e l l t h e property...and t o t r e a t himself...as the owner
..JJo .one would expect Mrs Evans...to be able t o s e l l the property or t o lease i t . '
Both conceptually and p r a c t i c a l l y , the d i f f i c u l t y of preserving a d i s t i n c t i o n between
a tenancy f o r l i f e and an equitable l i f e i n t e r e s t seems too d i f f i c u l t t o recommend
Bannister as a s o l u t i o n f o r Mrs Evans' problem, which c a l l s f o r a much less d r a s t i c
course.
Lord Denning's answer i s equally problematic and f o r the same, terminological,reason.
Given t h a t , t o be s p e c i f i c a l l y enforceable, a licence must arise out o f a contract
capable o f a t t r a c t i n g such a remedy, preservation of a d i s t i n c t i o n between contracts
'which a court of equity w i l l enforce,' and others, enforceable a t common law and
requiidng consideration, becomes precarious: we have seen the assimilation by common
law of equitable contract i n the past. The main objection t o Atiyah's reformulation
of a law o f o b l i g a t i o n s i s t h a t i t repeats the o l d terminology t o the extent that i t
I
u t i l i s e s 'contract', and 'consideration', A f r e s h look, a t the remedies required,
r a t h e r than a t the substantive categories to which the r e s u l t s of the remedies may
be analogous}"'"^'^ would be preferable.
D.ir Raymond Evershed, M R however, accepted t h a t , as between a l a n d l o r d and a tenant,
agreement t o permit the tenant t o remain on the premises r e n t free would be enforced
jy the courts as a c o n t r a c t : Foster v Robinson. S i m i l a r l y , i n Winter Garden Theatre
'ootnotes:
:L16
(1972) 2 A l l a R 70 a t p7i4F per l o r d Denning, M R.
;L16a I l l u s t r a t i v e of the danger o f proceeding by analogy i n the area o f n a t u r a l
science i s the controversy over the nature o f l i g h t - p a r t i c l e s or waves? I t
turns out, f o r p r a c t i c a l purposes, t o have the c h a r a c t e r i s t i c s o f both, because
i t i s n e i t h e r : the words are descriptions by analogy.
P T 0
122
117
V Millenium Productions Ltd
'
' the court granted t h a t a contractual licence might
be s p e c i f i c a l l y enforced against the l i c e n s o r . I t i s tenpting to suggest that t h i s
remedy might a v a i l a p l a i n t i f f against a t h i r d party. M i l i t a t i n g against indiscriminate
use i s i t s equitable
(thus d i s c r e t i o n a r y ) nature. The p o i n t was d e l i b e r a t e l y l e f t open
118
by Ifegarry, J i n Hounslow v Twickenham,
and i t may be t h a t orthodoxy w i l l p r e v a i l .
I
A second i n t e r e s t i n g p o s s i b i l i t y suggested by Lord Denning M R, i s that 'the c o u r t w i U
impose on the purchaser a constructive t r u s t f o r her (Mrs Evans') benefit f o r the
simple reason t h a t i t would be u t t e r l y inequitable f o r the purchaser to t u r n the widow
119
out contrary t o the s t i p u l a t i o n subject t o which he bought the premises.'
The
120
|objection r a i s e d
t h a t a constructive t r u s t should be imposed only 'where a l l the
p o l i c y considerations j u s t i f y such an action, not j u s t because i t happens to be
121
convenient i n the i n d i v i d u a l case'
i s surely inappropriate, f o r p o l i c y can make
i t s e l f f e l t only through i n d i v i d u a l cases, and i t can never have been p o l i c y to
r e t r a i n the extension of d i s c r e t i o n a r y remedies, not subject to the 'hard cases'
122
aphorism,
where i n j u s t i c e would otherwise r e s u l t . Mr Oakes' own suggestion of an
I n j u n c t i o n to r e s t r a i n a breach of contract i s anyway open to precisely the same
o b j e c t(I9i;6)
i o n , since
417
1 A l lthe
S R end
678 product
(CA) c i it es d the
i n same.
Hounslow v Twickenham (1970) 3 A l l E R 326
at
Footnotes:
p335d. The decision i t s e l f was reversed i n the House of Lords, (19U7) 2 A l l E R
331,
but 'nothing t h a t I can see i n the speeches i n the House of Lords suggests
t h a t the Court of Appeal was wrong i n the law which t h a t court applied t o an
irrevocable l i c e n c e . ' op c i t per Megariy, J.
lil8
(1970) 3 A l l E R
326.
119
(1972) 2 A l l E R 70 a t p76b. Lord Denning c i t e s Cardozo, J i n Beatty v
Guggenheim (1919) 225 N Y 38O a t p385: 'A constructive t r u s t i s the formula
through which the conscience of equity f i n d s expression.'
1^0
Oakley: 35MLR551.
lla
Op c i t at p556.
1P.2
Mich overworked anyway. See Stone: Legal System.
P T 0
123
T h i r d , and coii?)letely overlooked by the ccurt, i s the conferring upon Mrs Evans o f
a r i g h t t o enforce the contract between the other two, w i t h or without the use o f a
123
constructive t r u s t . Underlying Beswick v Beswick
was the need t o confer such a
'right i n a widow as regards a c o n t r a c t made between her deceased husband and h i s
.ephew, by the terms o f which the l a t t e r agreed, i n r e t u r n f o r the business, t o pay
jsums o f money t o the husband, and, a f t e r h i s death, t o h i s widow. The court rejected
Jher claim d i r e c t l y t o enforce the c o n t r a c t ^ ^ ^ but gave her an i n d i r e c t remedy qua
x e c u t r i x . This scarcely stands s c r u t i n y as anything other than a jus quaesitum t e r t i o ,
• f o r there i s a d i s t i n c t l o g i c a l d i f f i c u l t y i n allowing her t o stand i n the shoes o f
the
deceased so as t o enforce a contractual term which the deceased could not have
ijnforced: by i t s nature i t was not enforceable u n t i l he had died. This seems t o have
125
been the view o f the court i n S n e l l i n g v S n e l l i n g
where Ormrod J said: 'the
p r i n c i p l e seems t o be t h a t i f the r i g h t p a r t i e s are before the coiirt the a c t i o n w i l l
126
1)6 maintainable.'
Transposed i n t o the Binions s i t u a t i o n the p r i n c i p l e seems t o
^ l e l d t h i s : t h a t where Mrs Evans pursued the defendants her contractual r e l a t i o n s h i p
Tr^ith Tredegar Estates would have enabled her t o j o i n them as c o - p l a i n t i f f s , w i l l y r J i l l y . Once the p a r t i e s were served w i t h process, they would be before the court, and
Ormrod J's dictum would have applied.
127
Ap-ternatively, the much-neglected approach o f Tomlinson v G i l l
might have been
used. Here a widow was promised by the defendant t h a t i n consideration o f h i s appointment
as a d m i n i s t r a t o r o f her l a t e husband's e s t a t e , he would pay any debts due t o a
123 (1967) 2 A l l B R 1197.
Footnotes:
l[lh This accords w i t h conventional wisdom. See Dunlop v Selfridge (l9l5)AC8ii7j
Dowrick: Jus Quae s i turn T e r t i o i n Contract l 5 M[il37U.
1J!5
(1972)\A11 S R 79.
1^:6 Op c i t a t p87c.
127
(1756) Ambler 330. For a more complete c i t a t i o n of a u t h o r i t i e s see Corbin:
Contracts f o r the Benefit o f a Third Party U6LQR12.
P T0
12h
121k'
deficiency of. assets.
As her husband's c r e d i t o r 'the p l a i n t i f f i s proper f o r
r e l i e f here...he could not maintain an a c t i o n a t law, f o r the promise was made t o
the widow; but he i s proper here f o r the promise was made f o r the b e n e f i t o f the
128
c r e d i t o r s and the widow i s a trustee f o r them.'
'The equitable r u l e was t h a t the
party to whose use, o r f o r whose b e n e f i t a contract had been entered i n t o has a
129
remedy i n equity against the person w i t h whom i t was made.'
The r u l e i n Lamb v
129
Vice
t h a t the promissee i n a contract made f o r the b e n e f i t of a t h i r d party could
have f u l l , and not merely nominal, damages f o r the breach of the contract i s consequent
• 130
upon t h i s reasoning.
I t i s important t o n o t i c e t h a t i n creating a t r u s t , the court i n Tomlinson d i d not
make the defendant a trustee o f the estate f o r the b e n e f i t o f the c r e d i t o r s , but
instead made the widow a trustee o f the promise f o r t h e i r b e n e f i t . I t was not o f a
fund, -but o f the r i g h t t o sue t h a t she was t r u s t e e . I n terms, once more, of Binions
V Evans, whether or not Mrs Evans had a contract w i t h Tredegar Estates - the e f f i c a c y
o f t h i s being the lynch-pin o f the other solutions - she may sue the Binions through
her trustees, Tredegar Estates, who, though they no longer hold an i n t e r e s t i n the
property, r e t a i n a r i g h t t o sue on the contract w i t h the Binions, and i f necessary,
obtain an i n j u n c t i o n t o r e s t r a i n them from e v i c t i n g Mrs Evans.
Footnotes:
[L27A His motive was presumably as t o obtain the status o f preferred c r e d i t o r i n the
deceased's estate, a valuable p e r q u i s i t e o f an administrator's o f f i c e p r i o r t o
1971.
128
Op c i t a t P33U.
L29
Corbin op c i t a t p l 8 l - 2 . The common law p o s i t i o n was summed up i n Lamb v Vice
(l8i4.0) 6 M & ¥ 1;67, a case i n Exchequer Chamber, and therefore superior t o the
subsequent case o f Tweddle v Atkinson
( I 8 6 I ) 1 B & S 393^ which could be held
t o be per incuriam.
i30
That he could have only nominal damages ' i s a s t a r t l i n g and an alarming doctrine,
and a novelty.» per Lush, J i n Lloyd's v Harper (I88O) I 6 Ch D 290.
PTC
l.?5
This
last
seems the t i d i e s t
s o l u t i o n , and
o f e q u i t y . I n e s s e n c e , the t r u s t
i s a restraint,
b e n e f i c i a r y , upon t h e p r o m i s s o r . As
i s misguided,
the one most c o n s i s t e n t w i t h the n a t u r e
f o r there i s nothing
g r a n t e d a t the s u i t of a t h i r d p a r t y
131
Cbrbin i n d i c a t e s ,
the s e a r c h f o r a t r u s t
inherent i n a t r u s t which
fund
r e q u i r e s t h i s : i t i s the
132
p r o d u c e of a l a s t i n g j u r i s t i c p r e o c c u p a t i o n w i t h ' t h i n g s . '
However one v i e w s
the d e c i s i o n i n B i n i o n s v E v a n s ,
the widow o b t a i n e d a r i g h t
to
r e m a i n on t h e l a n d : i t seems b e t t e r t h a t t h i s s h o u l d have a s i t s o r i g i n the c o n t r a c t
between the v e n d o r and
o f t h e r i g h t , and
the p u r c h a s e r , so t h a t both the i s s u e of the
i t s e f f i c a c y i n r e l a t i o n to t h e t h i r d p a r t y , a r e a v o i d e d . T h a t
remedy h a s been g i v e n c r e a t i n g i n i t s wake a r i g h t not c o n t e m p l a t e d
ago
i n Lord Birkenhead's
a
a half-century
l e g i s l a t i o n i s s c a r c e l y a c a u s e f o r a l a r m , however, and
even
i f lomlinson v G i l l
will
be many c a s e s i n w h i c h
i f Mrs
registrability
c a n be u t i l i s e d
i n B i n i o n s v Evans
i t i s clear that there
i t cannot be a p p l i e d ; f o r example i t would be
inapplicable
E v a n s w e r e n o t m e n t i o n e d a t the time of the c o n t r a c t f o r s a l e . Thus the need
f o r t h e k i n d of remedy e n v i s a g e d by L o r d Denning, M R,
persists.
A d e f e n s e of t h e l a t t e r
of the p r e m i s e s of the p r e s e n t
i n v o l v e s an examination
of one
t h e s e s . Concepts,
I have s u b m i t t e d , a r e s u b o r d i n a t e t o , i n d e e d g i v e n s u b s t a n c e
t h e u s e s to w h i c h
t h e y a r e p u t . Chaos and O l d N i g h t a r e a v o i d e d i n the r e a l i t y of a
132 A
living
s y s t e m of law
by the u n i t y of approach
by,
g o v e r n i n g both ends and means. T h a t
[Footnotes:
131
I n the a b o v e - c i t e d a r t i c l e .
132
Hohfeld's
t a l k of
'bundles
of r i g h t s ' to d e s c r i b e r i g h t s i n rem
i n t h i s r e g a r d . See a l s o some d i s c u s s i o n s of l e g a l
132A
C h e s h i r e : A New
Keppell V Bailey
of r i g h t s
E q u i t a b l e I n t e r e s t i n Land
( 1 8 3 4 ) My & K 517.
personality.
16MLR1 a t plO, c i t e s L o r d brougham i n
' G r e a t d e t r i m e n t would a r i s e and much c o n f u s i o n
i f p a r t i e s were a l l o w e d to i n v e n t new modes of h o l d i n g and e n j o y i n g
r e a l p r o p e r t y , and
which
i s unhelpful in
to i m p r e s s upon t h e i r l a n d s and
tenements a p e c u l i a r c h a r a c t e r
s h o u l d f o l l o w them i n t o a l l hands, however remote.' As C h e s h i r e p o i n t s out,
f o u r t e e n y e a r s l a t e r came T u l k v Moxhay ( 1 8 4 8 ) ( 1 8 4 3 - 6 0 ) A l l E R Rep
new
e q u i t y of r e m a r k a b l e
and
i t i s w o r t h remembering t h a t l a n d was
significance
9, w i t h
v i r i l i t y . ' Moreover, the p r e d i c t e d d e t r i m e n t d i d n o t
of g r e a t e r s o c i a l and
»A
occur
economic
then.
P T 0
126
Mrs
Evans' i n t e r e s t
does n o t a s s i m u l a t e
i n l a n d depended f o r i t s e x i s t e n c e upon t h e j u s t i c e o f h e r cause
the members o f t h e C o u r t
o f A p p e a l t o t h e c a d i under h i s palm
t r e e , C0hjui"ing up t h e s p i r i t s o f u n c e r t a i n t y whom L o r d H a l s b u r y
I n a l l cases the statement
that
sought t o e x o r c i s e .
'Y has X i n t e r e s t i n l a n d ' i s m e r e l y a n o t h e r way of s t a t i n g
'the m e r i t s o f Y ' s c a s e o u t w e i g h t h o s e
o f Y ' s opponents,' The same c o r e p r i n c i p l e
133
u n d e r l i e s t h e s t a t e m e n t t h a t ' i t i s i n e q u i t a b l e t h a t Y s h o u l d be t u r n e d o u t by Z.'
I f we c a n e x p l o r e why i t i s i n e q u i t a b l e , w i t h o u t
m e r e l y r e s t a t i n g t h a t i t i s so i n
Iwords w h i c h a r e d i f f e r e n t , y e t seem t o c o m p e l ! u s t o awkward c o n c l u s i o n s , we may
avoid
t h e c h a r g e o f c a p r i c e . Chaos a n d u n c e r t a i n t y a r e r e s i s t e d because i f we c a n
r e a d the meaning o f t h e p r e c e d i n g
law,
add t h i s t o t h e f a c t s , and then
include the
i n d i s p o s a b l e c a t a l y s t o f s o c i a l d e s i r a b i l i t y , we c a n p r e d i c a t e the p r i n c i p l e
Icontaining t h e s o l u t i o n i n a d v a n c e . The 'Bad Man' o f M a s s a c h u s e t t s may have h i s
[answer, 'what t h e c o u r t s w i l l do, and n o t h i n g
like
more p r e t e n t i o u s , ' though he may n o t
it.
'Che
equation
I have o u t l i n e d i s n o t a n a t t e m p t t o r e s u r r e c t S a v i g n y ' s
nor
i s i t a d i f f e r e n t way o f e x p r e s s i n g
and
n o t made. I t s components v a r y w i t h s o c i a l p r i o r i t i e s , a n d a s a r e s u l t , s o w i l l
;he a n s w e r . N e i t h e r
Volksgeist,
t h e d i s c r e d i t e d v i e w t h a t law i s d e c l a r e d
t h r o u g h l o g i c ^ ^ ^ n o r t h r o u g h s t a r e d e c i s i s ^ c a n law become
c e r t a i n . I n s o f a r a s law i s c o n c e r n e d w i t h j u s t i c e - n o t t h e j u s t i c e o f the A u s t i n i a n ,
I
f o r t h e r e a r e t o o many v a r i a b l e s i n t h e c a l c u l a t i o n , n o r t h a t o f the
utilitarian
whose a r i t h m e t i c c a l c u l a t i o n s a r e too crude - we may approach a c e r t a i n t y o f
Footnotes;
133
Atiyah: Accidents,
Compensation and the Law a p p r o a c h e s t h e r e a s o n i n g
li
d u t y o f c a r e i n t h e same way, r e f e r r i n g t o 'the e x t r a o r d i n a r y h o l d w h i c h
c o n c e p t s a c q u i r e on the minds o f l a w y e r s ' ( p 4 6 ) .
is
simply
behind the
legal
'The c o n c e p t o f t h e duty o f c a r e
coextensive with the boundaries of l i a b i l i t y ' ( p 4 7 ) .
134
See L l o y d : R e a s o n a n d L o g i c i n t h e Common Law 64I/5R468.
i'35
See, i n t e r a l i a .
S t o n e : L e g a l System, r e f e r r i n g t o L l e w e l l y n ' s
'leeways'.
P T 0
127
symbolism, although
t h e v a l u e s w h i c h we a t t r i b u t e
t o t h e symbols w i l l
inevitably
13 6
a l t e r . Through R a w l s '
concerning
Simply
we c a n p e r h a p s f i n d an a c c e p t a b l e h y p o t h e s i s
justice.
p u t t h e n , u s i n g t h e S)mibols g i v e n by g e n e r a t i o n s o f j u d g e s , f o r example,
justice,
spirit
social-contract
r e a s o n a b l e n e s s , f a i r n e s s and e q u i t y among o t h e r s , and by p r o c e e d i n g
of the e a r l i e r
case. This i s , that
i n the
c a s e s t o w h i c h I have r e f e r r e d , one might examine, s a y , Mrs E v a n s '
s h e h a s r e l i e d upon h e r agreement - c o n t r a c t u a l o r n o t - w i t h
Tredegar
E s t a t e s . She h a s n o t been i n d u c e d
inclined
todo, o r i n d e e d , d o i n g , b u t a p r o m i s e was made t o h e r i n c e r t a i n c i r c u m s t a n c e s
justify
t h e i n t e r v e n t i o n o f t h e law t o e n a b l e h e r to c o n t i n u e to b e n e f i t from t h e
promise o r , i n other s i t u a t i o n s ,
depends upon f a c t o r s e x t r i n s i c
is
upon t h e s e f a c t o r s
relies.
As a b a s i c
promise,
Ibelief
to r e c e i v e compensation f o r h e r disappointment,
t o t h e law and w h i c h sound n e b u l o u s :
l e g a l g e n e r a l i s a t i o n from t h e c a s e s we m i g h t suppose t h a t where a
o r an a c t , o r o m i s s i o n h a s o c c u r r e d s u c h t h a t i t g e n e r a t e s a r e a s o n a b l e
i n the o r d i n a r y course of events
:he r e c i p i e n t ,
subsequent
the recipient w i l l
disappointment,
boundaries
society,
nevertheless i t
t h a t t h e s u p e r f i c i a l l y more s u b s t a n t i a l t e s t o f ' r e a s o n a b l e n e s s '
fjho p r o m i s e d , a c t e d , o r o m i t t e d
The
t o do t h a t w h i c h she was n o t a l r e a d y
i n t h e mind o f a
to a c t , w i l l
be e n t i t l e d
that the person
do o r h a s done something i n r e l a t i o n t o
to r e l i e f
o r compensation f o r h i s
i f any.
o f what i s a ' r e a s o n a b l e b e l i e f
insofar as this
recipient,
will
i s t r a n s m i t t e d through
v a r y a c c o r d i n g to the views of
t h e c o u r t s , a s t o who s h o u l d
:.osses. Thus i t may be t h a t i n an e n t r e p r e n e u r i a l o r c a p i t a l i s t
bear
s o c i e t y , o r one w h i c h
:he c o u r t s b e l i e v e i s s u c h , a g r a t u i t o u s p r o m i s e g i v e n i n a c o m m e r c i a l c o n t e x t
n o t be one w h i c h w i l l
nay
generate
a reasonable b e l i e f
will
i n i t s i n v i o l a b i l i t y . A further
test
be added, namely t h a t , o u t s i d e t h e s p h e r e o f i n s u r a n c e , o r e x c e p t i o n a l
137
c^irciamstances,
t h e r e s h o u l d be ' r e a s o n a b l e f o r e s e e a b i l i t y ' b e f o r e t h e p a r t y c a u s i n g
36
E a w l s : A Theory of J u s t i c e ; I n p a r t i c u l a r
fl'ootnotes:
i37
The w i d t h
the essay ' J u s t i c e as F a i r n e s s ' .
of e x c e p t i o n a l circumstances w i l l
v a r y w i t h s o c i a l e x p e c t a t i o n s . I n the
game o f 'Diplomacy' Hedley B y r n e would n o t be compensated f o r r e l y i n g on H e l l e r &
P a r t n e r s ' statements
as to Easipower's
financial
status.
P T 0
128
the disappointment
situation,
s h o u l d s u f f e r compared w i t h t h e r e c i p i e n t . I n t h e B i n i o n s v Evans
t h i s p r o d u c e s t h e r e s u l t t h a t h a d t h e B i n i o n s h a d no knowledge - and t h e
imputation of ' c o n s t r u c t i v e n o t i c e ' i s , again, a tinkering with
f o r e s e e a b i l i t y ' to a d j u s t
liability
'reasonable
to s o c i a l c i r c u m s t a n c e s - which i s expressed a s
' n o t i c e ' i n the context of r e a l property
law, t h e n Mrs E v a n s would have been
138
unprotected.
139
The
not d i s s i m i l a r
c a s e of Hussey v Palmer
was s o l v e d by the m a j o r i t y of t h e Court
o f A p p e a l u s i n g , once more, ' g e n e r a l i s a t i o n s . . . m o r e f a m i l i a r t o A m e r i c a n than
English
140
lawyers.'
Plaintiff,
a woman ' w e l l o v e r 7 0 ' s o l d h e r condemned house, and was
i n v i t e d t o s t a y w i t h h e r daughter
large,
the p l a i n t i f f
a n d s o n - i n - l a w . S i n c e t h e i r house was i n s u f f i c i e n t l y
p a i d f o r a n a d d i t i o n a l room t o be b u i l t from t h e proceeds o f
s a l e o f h e r own h o u s e . She a n d t h e d a u g h t e r
l e f t . A year l a t e r ,
q u a r r e l l e d and a f t e r f i f t e e n months she
b e i n g h a r d up - t h e b a l a n c e o f t h e p r o c e e d s
h a v i n g been s p e n t - s h e a s k e d t h e s o n i n law, f i r s t
of sale
presumably
f o r some f i n a n c i a l a s s i s t a n c e and
t h e n , s i n c e t h i s r e q u e s t were unacknowledged, f o r a repayment o f t h e c o s t o f t h e e x t r a
141
room.
She was n e a r l y d e f e a t e d by t h e g h o s t s o f t h e forms o f a c t i o n , r a t t l i n g
chains
i n h e r path,
f o r t h e r e g i s t r a r b e f o r e whom she f i r s t
their
appears, c l a i m i n g
repayment o f t h e l o a n , d e c i d e d t h a t t h i s was a f a m i l y arrangement and was t h e r e f o r e
l u n e n f o r c e a b l e . To overcome t h i s d i f f i c u l t y s h e c l a i m e d the money under a r e s u l t i n g
t r u s t . Lord Denning, M R
agreed,
though f e e l i n g
'that the t r u s t i n t h i s case, i f
t h e r e was one, was more i n t h e n a t u r e o f a c o n s t r u c t i v e t r u s t ; b u t t h i s i s more a
t
a t t e r o f words...The two r u n t o g e t h e r . By w h a t e v e r name i t i s d e s c r i b e d i t i s a t r u s t
ootnotes;
138
Quaere w h e t h e r a t r u s t w o u l d n o t have a f f e c t e d t h e purchase-money, however.
139
(1972) 3 A l l E R 744.
140
|l41
G o o d h a r t : 89LQR2.
The c i r c u m s t a n c e s assume i m p o r t a n c e
more t h a n a s y s t e m
o f c o u r s e , once one a c c e p t s t h a t t h e law i s
o f r u l e s produced by g e n e r a l i s i n g from t h e f a c t s o f e a c h
c a s e , b u t a method o f s o l v i n g d i s p u t e s i n a s o c i a l l y a c c e p t a b l e way. D i s p u t e s
r a r e l y s o r t themselves
Procrustean concepts.
out f o r the b e n e f i t of p o s i t i v i s t
lawyers w i t h
their
,
P T 0
129
imposed by law whenever j u s t i c e and good conscience require i t . I t i s a l i b e r a l
process, to be applied i n cases where the defendant cannot conscientiously keep the
142
property f o r himself alone'
The judge a t f i r s t instance, and Cairns, L J on appeal,
both preferred t o see the 'transaction as a loan. Had t h i s been the majority view on
appeal, Mrs Hussey would have been unsuccessful, the pleadings not having claimed the
r e t u r n of money l e n t , as a r e s u l t of the Registrar's decision.
Dr Goodhact objects t o the use of the p r i n c i p l e stated i n Chalmers v Pardoe (ante) on
the ground that there was here no promise t o Mrs Hussey of a conveyance of the
property: however, the expectation was created, and w i t h i n the p r i n c i p l e I have already
stated, such an expectation was i n the circumstances reasonable. No express promise
143
ijas made i n Inwards v Baker ( a n t e ) .
Goodhart's second objection i s that a
constructive t r u s t should not have been imposed without a consideration of Carl Zeiss
144
S t i f f t u n g V H Smith.
An examination of the circumstances of t h i s case leaves l i t t l e
troom to doubt t h a t i t could have been distinguished. The alleged constructive trustees
were s o l i c i t o r s , and the r e c e i p t of assets by them took place during l i t i g a t i o n ,
l)etween an East German and a West German foundation, which had lasted since 1955. I n
145
;he words of Lord Selborne, i n Barnes v Addy
' I f those p r i n c i p l e s were disregarded.
know not how anyone could, i n transactions admitting of doubt as to the view which
A Court of Equity would take of them, safely discharge the o f f i c e of s o l i c i t o r , of
banker, or of agent of any sort t o trustees.' The p r i n c i p l e s were that the constructive
tfrustee must have had cognizance of the t r u s t , and that the transfer of funds to him
146
V as a m i s a p p l i c a t i o n of the funds.
However, '...as I understand i t , no stranger can
pecome a constructive trustee merely because he i s made aware of a disputed claim the
\ f a l i d i t y o f which he cannot properly assess.''''^^
]l42
(1972) 3 A l l E R 744 a t p747c per Lord Denning M R.
ootnotes:
143
(1972) 3 A l l E R 744 a t p748A per Lord Denning M R.
144
(1969) 2 A l l E R 367.
1145
(1874) 9 Ch App 244 a t p252 c i t e d by Danckwerts L J (1969) 2 A l l E R 367 at
p374G.
146
Reference was made a t p372F to Halsbury 3rd Ed v o l 38 paras 1446-1450.
147
(1969) 2 A l l E R 367 a t p378B per Sachs L J.
P T 0
130
lEdraund Davies L J i n t h a t case approved Snell's expression: 'A possible d e f i n i t i o n
i s t h a t a constructive t r u s t i s a t r u s t imposed tiy equity i n order t o s a t i s f y the
demands of j u s t i c e and good conscience -without reference t o any express or presumed
i n t e n t i o n of the p a r t i e s . '
t
'Concepts', the learned judge adds,'may defy d e f i n i t i o n
nd y e t the presence i n , or absence from a s i t u a t i o n of t h a t which they denote, nay
e beyond doubt. The concept o f 'want o f p r o b i t y ' appears t o provide a u s e f u l touchstone
1] p
!in considering circumstances said t o give r i s e t o constructive t r u s t s . '
I n Hussey^v Palmer the Court of Appeal accepted t h a t Mrs Hussey d i d not intend a g i f t
of the money. At the time of the payment i t s purpose was to provide her w i t h somewhere
t o . l i v e f o r the r e s t of her l i f e , and 'want of p r o b i t y ' i s surely evident i n the son's
r e f u s a l t o accept l i a b i l i t y of any k i n d f o l l o w i n g the f a i l u r e of t h a t i n t e n t i o n .
lij.9
Both the a v a i l a b i l i t y of the constructive t r u s t doctrine,
and the p r i n c i p l e s of
Inter a l i a Unity v King, Chalmers v Pardee and Inwards v Baker a t t e s t the correctness
3f the decision.
!?wo f u r t h e r cases i l l u s t r a t e t t e e s s e n t i a l f l e x i b i l i t y of the equitable approach. I n
^ J Alan L t d v S I Nasr Co"^^^Kenyan s e l l e r s of coffee entered two contracts w i t h the
2'espondents each f o r the sale o f 2^0 tons o f coffee, payment t o be by confirmed
irrevocable l e t t e r s o f c r e d i t , and i n Kenyan s h i l l i n g s . The buyers paid f o r the e n t i r e
Shipment of ^00 tons by means o f a single l e t t e r of c r e d i t which, i n several other
v ays d i d not conform w i t h the terms of the contract: moreover payment was expressed
"to be made i n pounds s t e r l i n g . Nevertheless, the s e l l e r s accepted t h i s mode of payment
l y drawing on the l e t t e r f o r the amount o f the i n i t i a l 250 tons, and shipped the
palance of the coffee (the q u a n t i t y shipped i n September of 196? i n two instalments
c t u a l l y being 279 t o n s ) . Devaluation of s t e r l i n g occurred very s h o r t l y a f t e r the
decond shipment, and the s e l l e r s required a d d i t i o n a l payment, asserting t h a t the
slo.otnotes:'.• , c i t i n g S n e l l : Equity
^
/
1U8
I b i d a t p38l,
26th Ed • p201.
]Jl49
See also the matrimonial cases c i t e d by Lord Denning M R a t (1972) 3 A l l E R
7hh a t p7i+7E.
ito
(1972) 2 A l l S R 127.
P T 0
131
Kenyan currency was the money o f account, not merely the money o f payment"'"^ under
the contract. The buyers r e p l i e d t h a t t y accepting the nonconforming l e t t e r o f c r e d i t
the s e l l e r s had inade a representation varying the contract which they were now precluded
from leneging 2 i n other words they could not r e l y on t h e i r s t r i c t l e g a l r i g h t s .
There was no detriment t o the promissee, indeed, as l o r d Denning indicates, there was
la b e n e f i t .
But 'he has conducted h i s a f f a i r s on the basis t h a t he has t h a t benefit
[and i t would be i n e q u i t a b l e now t o deprive him o f i t . •"''^^ A clear development i s taking
place, away from the confusion between detriment, reliance and the consideration
d o c t r i n e , y e t s u f f i c i e n t v i t a l i t y remains, and promise-enforcement has not become a
d o c t r i n e , so t h a t i n the s i m i l a r case o f Woodhouse AC I s r a e l Cocoa L t d S A v Nigerian
Produce Marketing Co Ltd'*'^^ both the Court ,of Appeal and the House o f Lords agreed
that the decision d i o u l d go the other way. I n W J Alan the circumstances were such
as t o render enforcement by the s e l l e r o f h i s l e g a l r i g h t s inequitable, w h i l s t i n
Moodhouse they were not.
jlere cocoa had been purchased i n s t e r l i n g u n t i l a request by the s e l l e r s had had the
E f f e c t of s u b s t i t u t i n g Nigerian pounds. Because i t was not possible t o buy t h i s
currency forward, the buyers obtained two concessions from the s e l l e r s : one was that
eixisting contracts could be t r e a t e d as i f the 'money of account were B r i t i s h currency';
knd the second was t h a t f o r the f u t u r e s t e r l i n g should be the currency o f account,
l i o t h o f these concessions were subsequently withdrawn despite the requests o f the
buyers. C r u c i a l t o the decision was whether, i n the l i g h t o f t h i s withdrawal, a l a t e r
].etter agreeing t h a t payments might be made i n s t e r l i n g was a representation that
s t e r l i n g had once more become the currency o f account. With devaluation impending,
the concessions had c l e a r l y been withdrawn t o prevent t h i s , and the alleged representation
lootnotess
l|5l
The d i s t i n c t i o n i s made liy Lord Denning M R i n the C A i n Woodhouse AC I s r a e l Cocoa
L t d S A V Nigerian Produce Marketing Co (1971) 1 A l l g R 66$ a t p662.
lfe2
As i n High Trees, where i t was t o the promissee's advantage t o pay a rent of
£1,2^0 p a r a t h e r than o f £2,500.
1^3
(1972) 2 A l l S R 127 a t pli+OF per Lord Denning M R. See also the judgement o f
Megaw L J a t pli|/|E.
15k
(1972) 2 A l l B R 271.
p ^^
132
was i n response t o the buyers' request ' i f you can arrange t o accept payment against
documents i n s t e r l i n g i n Lagos as a temporary alternative?'"^^^ The umpire's f i n d i n g
t h a t the r e p l y was a representation estopping the s e l l e r s was unfortunate, not l e a s t
because i t could be overturned only i f i t were a f i n d i n g o f law. To permit the f i n d i n g
t o stand appeared manifestly unjust t o both appeal courts, and so the question of
what a representation was i n a l l the circumstances becomes, l i k e the 'reasonable man'
a l e g a l concept: one fears t h a t i t s t e r r e s t r i a l f e e t may atrophy, and a f t e r 'the whole
sequence o f cases based on promissory e s t o p p e l . . . ( i s ) reduced t o a coherent body of
dectrine'"^^^ i t may become y e t another mere vehicle f o r lawyerish preconceptions.
Footnotes:
155
I b i d a t p279B i n Lord Hailsham's
156
I b i d a t p282G per Lord Hailsham.
judgement.
133
CONCLUSION
A t the outset i t was suggested t h a t law should be seen as a dynamic apparatus f o r the
r e s o l u t i o n o f disputes, and t h a t noles of law are h i s t o r i c a l statements of how t h i s
has been accomplished - namely by the grant or r e f u s a l t o grant recognition t o claims
asserted by i n d i v i d u a l s or groups - and why. The normative content o f these
statements
derives from one of the components i n the postulated j u s t i c e equfation; t h a t of the
f e l t need f o r consistency, or evenhandedness i n the administration of law.
Consistency
i s generally seen as s a t i s f a c t o r i l y reached by means of analogy: l i k e cases shouldT be
t r e a t e d a l i k e unless some other component i n the equation i s given p r i o r i t y .
I n the 'trouble' case, analogy i s extended and weak. The other component, t h a t o f
s o c i a l e f f i c a c y , becomes i n r e l a t i o n more powerful i n such cases; but even where a
rthole l i n e o f decisions i s i n t e r l o c k e d by analogy, the question o f social e f f i c a c y
Lies to hand, f o r l e g a l p r i n c i p l e s are not formed i n vacuo. I s o l a t i o n of s o c i a l
natrices assists i n the i d e n t i f i c a t i o n of unsuspected analogies, and, as suggested
•above, reveals the fundamental u n i t y of remedy and r e s u l t a n t r i g h t .
:j: have t r i e d t o l o c a t e i n equity a coherent body of p r i n c i p l e s r e l a t i n g t o l i a b i l i t y
'
2
'or promises, established by a l i n e o f decisions from those discovered by Barbour
0 Hughes^ and from Hughes t o the present, and j u s t i f i e d by reference t o s o c i a l
Expectations. I t i s no accident that c o n t i n u i t y of development by analogy, from case
•t o case, i s i n t h i s sphere a t i t s most confusing i n the l a t t e r h a l f of the nineteenth
cjentury: nor i s i t s u r p r i s i n g t h a t , i f I am correct i n suggesting t h a t equity and
ommon law developed a d i f f e r i n g view of contracts, t h i s should have occurred a t the
tieginning of what was i n the West a period of dramatic commercial expansion. Equity
was by t r a d i t i o n the law of the poor man,
through the Court of Requests? nor d i d
Star Chamber's remedies b e n e f i t only the Grown i n t h e i r a p p l i c a t i o n to the r i c h and
powerful. I f a poor man encountered a n a t i o n a l law a t a l l , other than upon suspicion
Footnotes:
For a less agreeable exanple, see the reasoning behind P r i e s t l e y v Fowler (1837)
3 M & W 1.
Barbour: H i s t o r y of Contract i n Early Jffiiglish Equity.
Hughes V I f e t r o p o l i t a n Ry (ante).
P T0 •
13U
o f having broken the King's Peace, the chances of i t s being equity were high. Equally,
e q u i i ^ was the law o f the King and h i s executive. Their concern, as much as the poor
man's was t o achieve stability!:^ Bureaucracy, which term almost by d e f i n i t i o n embraces
any formal means of government, s t r i v e s t o maintain a status quo. Commerce, a t i t s
[entrepreneurial outset, has e n t i r e l y the opposite o b j e c t i v e ^
The men of commerce looked t o the common law, and, as I have suggested, i t was the
common law which assisted the r a p i d development of a market economy, w h i l s t paradoxically,
purporting t o provide a p i l l a r f o r cherished t r a d i t i o n s and b e l i e f s . Those who
ventured
themselves or t h e i r wealth were i n p u r s u i t of the i n f i n i t e , and the common law r e f l e c t e d
t h e i r ethos i n the s i x t e e n t h century, j u s t as the Chancellor's court came to echo a t
times the u n i v e r s a l m a t e r i a l i s t optimism of the V i c t o r i a n s .
,6. r e s u l t of the modem r e c o g n i t i o n t h a t the world may a f t e r a l l not be inexhaustable,
and t h a t s o c i e t i e s may not increase t h e i r wealth i n f i n i t e l y has been a greater
r e a l i s a t i o n t h a t misfortunes must be shared; they cannot be repaired tjy the victim's
seeking recompense i n a New World wilderness. I n other words, l i k e the preColumbean
v i l l a g e , modem s o c i e t y can work j u s t l y only given l e g a l r e c o g n i t i o n of the inter-^
dependence o f t h e communi-ty's members.
::t i s i n t h i s context t h a t the Igrpothesis concerning the l e g a l e f f e c t of promises i s
£iet. i t seems s e l f - e v i d e n t t h a t wherever men deal w i t h one another, where l i v i n g
£!pace and e s s e n t i a l commodities, money and c r e d i t are i n v i s i b l y f i n i t e supply, a
Society wMch i s organised on a f o r m a l l y e g a l i t a r i a n basis^ and equally, i n a formally
footnotesi
See P l u c k n e t t : Concise H i s t o r y p638 '...the council and the Chancellor were a t
f i r s t concerned p r i n c i p a l l y w i t h the de facto f a i l i n g s of the common law ( t o
maintain the peace) r a t h e r than w i t h i t s d o c t r i n a l
shortcomings.'
See Schon's 1970 Reith Lectures f o r an account of the homeostatic nature of
both Government and commercial bureaucracies.
That i s t o say the k i n d of society which Dicey had i n mind. Society i s s t i l l
f o r m a l l y e g a l i t a r i a n where access t o remedies compares, i n the famous
phrase, w i t h access t o the R i t z Hotel.
P T 0
135
s t r a t i f i e d society, i n s o f a r as the r e l a t i o n s w i t h i n the s t r a t a are so organised,
duties w i l l be found in^^osed on the members of the society, or s t r a t a , i n much more
s t r i n g e n t terms than would be the case i n the expansive societies found i n the West
between the sixteenth and e a r l y twentieth centuries. Between de facto equals there
w i l l be, law aside, a f e l t need t o avoid methods of l i v i n g and transacting which are
I
7
[damaging t o dequalsl To the extent that law i s under the c o n t r o l of de facto equals,
i t h i s f e l t need w i l l f i n d l e g a l means o f expression.
We should therefore expect i n such societies l e g a l - using the term here to include
the
'laws' of p r i v a t e and l o c a l j u r i s d i c t i o n s , and those of the Chancellor - sanctions
attending what we may term bad f a i t h : the supply of shoddy goodsj the conduct o f
dangerous a c t i v i t i e s , the breach o f promises. A l l things are a matter of degree, of
course, so t h a t a purchaser of cheap goods may be taken t o assume the r i s k that they
' f l i l l not compare i n q u a l i t y w i t h equivalent but more^expensive
goods; and the
:recipient of an ambiguous promise, or one which i n a l l circumstances cannot be l e g a l l y
ijcknowledged t o have been seriously meant, should not expect l e g a l help t o enforce i t .
Some "of these expectations are t o be found r e a l i s e d i n the middle ages; i n p a r t i c u l a r ,
I
9
as Barbour's researches show, the Chancellor upholds promises. Vinogradoff indicates
the
same readiness on the p a r t of l o c a l j u r i s d i c t i o n s , and indeed much e a r l i e r the
Footnotes;
I
Clearly, the n o t i o n o f freedom o f contract, the 'hands-off' approach epitomized
by a Chancery judge o f the nineteenth centuiy. S i r George Jessel, (see the Sanpson
case c i t e d ante), does not s a t i s f y t h i s Eeeed.
8|
I n the sense a) t h a t the promissor d i d not mean i t j or b) that the promissee d i d
» not believe t h a t the promissor meant i t ; or c) t h a t i t would place a s o c i a l l y
unacceptable burden upon promissors t o have them bound to unwary promissees i n a l l
the
circumstances where the promissor d i d not intend t o be bound.
Vinogradoff: Reason and Conscience i n S«xteenth Centiny Jurisprudence 2ULQR373'
P T 0
i
..
136
'Common law i s t o be found granting r e l i e f without a s p e c i a l l y i n actions on a
covenant"}*^ Despite the eclipse o f the c o n c i l i a r courts i n the seventeenth century we
can trace the continued existence of promise-enforcement u n t i l the nineteenth century,
and the phrase mam^fsgext' consideration supports Atiyah's contention t h a t the term
consideration meant e s s e n t i a l l y a reason f o r -having entered i n t o a transaction; or,
nore properly, a reason why the courts should step i n and impose l i a b i l i l y . I n equity,
bhen, the term contract did not mean what i t came t o mean a t common law, t h a t i s t o
say, a bargain, or a t r a n s a c t i o n framed t o f i t the
bargain-form.
;[f the hypothesis i s c o r r e c t , not only s h a l l we f i n d a d i s t i n c t l i n e of promise<3nforcing decisions o f the k i n d postulated, i n equity, but we s h a l l also discover a
I growing tendency towards the same p r a c t i c e a t common law: not merely by v i r t u e o f the
inile t h a t equity p r e v a i l s , but because society has changed. Atiyah argues''^ t h a t i t
12
%s only by i g n o r i n g a s u b s t a n t i a l body o f case law
t h a t we can assert the nineteenth
c;entuiy dogma concerning common law contract.
I*rior t o 1875 we can f i n d numerous examples o f j u d i c i a l acknowledgement t h a t reasonable
expectations created by promises, or conduct reasonably capable of being taken to be
pjromises, should n o t be disappointed: Luders v A n s t ^ ;
Hammersley v de B i e l ;
Piggott
S t r a t t o n ; ^ Dilwyn v L l e w l l y n ; ^ Ramsden v Dyson"!"^ A f t e r 1875^ a t a time when we might
xpect a hardening o f the l e g a l a r t e r i e s , the same phenomenon reappears i n Plimmer v
Footnotes:
10
Pollock & Maitland: H i s t o r y Vol I I chapter 5-
11
A t i y a h : Consideration.
1-^j ^^The: perpetuation o f the o l d views may owe much t o Miessrs Cheshire & F i f o o t . See
. the select bibliography i n Atiyah: i n t r o d u c t i o n t o the Law o f Contract 2nd ed p28l.
ll3
(1799) h Ves 501.
IJ;'
(18U5) 12C1 & F i n
11J
(1859) IDe G F & J 33.
16
(1866) LR I HL 129.
i:'
(1862) i; De G F & J 517-
P T0
137
jJellington;
Hughes}^ & Birmingham?'^ I n s p i t e of Jorden v MoneyP and f o r the reasons
I have stated t h i s seems t o be a much narrower decision than i s commonly supposed,
i t may be possible t o r e f e r t o an 'equity' o f promises, f o r we can trace the l i n e of
equitable a u t h o r i t i e s more c l e a r l y . From a technical p o i n t of view - as d i s t i n c t from
the
f u n c t i o n a l i s t and somewhat s o c i o l o g i c a l view adopted immediately above - i t i s
22
a r a t i o n a l next step t o use Hohfeld's h e u r i s t i c technique
t o explain post-1875
developments. We can state t h a t the s t r i c t common law of contracts w i l l be applied
unless the equity i s invoked, when a promise w i l l be enforced despite i t s non-bargain
l a t u r e : which i s r e a l l y t o say t h a t the law w i l l uphold promises, dependent upon the
circumstances. Now t h a t equity automatically p r e v a i l s i n a l l courts, what we have t o
Look t o are the p a r t i c u l a r f a c t s o f the case. Just as the presence of what t e c h n i c a l l y
23
amounted t o consideration d i d not a v a i l the p l a i n t i f f i n Jones v Padavatton
because
the courts could f i n d no reason t o enforce the mother's promise, so the absence of
j j o n s i d e r a t i o n d i d not a v a i l the p l a i n t i f f i n Tabor v Godfrey^^ or High Trees^^ or the
26
27
defendant i n Chalmers v Pardee
or Ward v Kirkland.
i'ar from being weakened, the persuasiveness of the equity's existence i s strengthened
l y the v a r i e t y o f subject matters i n r e l a t i o n to which i t appears, f o r we have
postulated a Choiiiskyan 'deep-structure' need t o have promises enforced i n c e r t a i n
s o c i a l contexts, and we should a n t i c i p a t e the manifestation o f t h i s across a wide
range o f law categories,
lootnotes:
]J8
(I88ii) 9 App Gas U39.
19
(1877) 2 App Gas U39.
20
(1888) ho Ch D 268.
21
(1851;) 5 HL Gas 186.
22
Hohfeld: The Relation between Equity and Law 11 Mich L R 537-
23
(1969) ]HLR328.
2;
(1895) 6h LJ QB2i;5.
2J
(19J47) 1KB. •
20
(1903) MLR677.
2?
(1966) 1 A l l E R 609.
P T0
\•
The
138
constraints which should operate f o r the future development of a wider law, of
o b l i g a t i o n s rather than of c o n t r a c t ; have already been adverted t o . I t i s d i f f i c u l t
to conduct analysis of the l e g a l past, w i t h i t s undoubtedly normative influence on
the present and the f u t u r e , without imparting a n a t u r a l science vocabulary and
f o r g e t t i n g momentarily t h a t the parameters i n the j u s t i c e equation, r e f e r r e d to
3 a r l i e r , are man-made. I have postulated a ' f e l t need' t o impose l i a b i l i t y t o indemnify
Ln c e r t a i n circumstances, given c e r t a i n changes i n the nature of society; and the
3xistence o f the l i n e of equitable a u t h o r i t i e s makes i t possible to impose such
l i a b i l i t y . What i s required i s merely a proper common law eclecticism, applied across
the range of equitable and l e g a l remedies.
28
;'. have pointed out the l i m i t a t i o n s of Jorden v Money
and the narrowness of Foakes
29
•T Beer. E x p l o i t a t i o n of the Hughes and Birmingham cases rather than the more
30
(sonservative a u t h o r i t i e s t y p i f i e d t y The C i t i z e n s ' Bank
case, would have been
I)ossible. Indeed the l a t t e r may
i n s t r u c t i v e l y be seen i n the terms used by Childres
31
dnd S p i t z
i n r e l a t i o n to contracts. Here was a 'formal' transaction entered i n t o
l y s o p h i s t i c a t e d equals conversant w i t h the l e g a l rules as to preferment of c r e d i t o r s .
Ead the Louisiana
bank been successful, t h i s could only have been at the expense of
the other c r e d i t o r s , w i t h commercially'' i n e f f i c a c i o u s r e s u l t s .
Hughes was, however, consigned to obscurity, although the need f o r such a p r i n c i p l e
was recognised i n , i n t e r a l i a . Tabor v Godfrey^^ and Re W i l l i a m Porter^^ even i f not
expressly admitted. A second opportunity arose f o l l o w i n g the e x p l i c i t r e d e f i n i t i o n
o f the 'equiiy' i n High Trees, apparently t o be l o s t again as a r e s u l t of Combe v
Cbmbe'?^ But, as we have seen. Combe v Combe need not be seen i n t h i s , r e s t r i c t i v e .
Footnotes:
2(3
(185U) 5 H L Cas
186.'
29
(188U) 9 App Cas
6o5.
-30
(1873) L R V I HL 352.
3].
Ghildres & S p i t z : Status i n Contract Law hi
33
(1951) 2KB215.
32
(1895) 6i4 LJ QB2i;5.
3-
(1937) 2 A l l iS R
3il
(1951) 2 KB
/
See Spencer-Bower: Estoppel, f o r a f u l l e r l i s t .
NIULRl.
361.
215.
P T 0
^
.
139
l i g h t : the merits l a y c l e a r l y w i t h the defendant. Both t h i s case and D & C Builders
35
Rees
i l l u s t r a t e the necessity f o r a more f l e x i b l e response t o the facts than
might be accorded to them t y the a p p l i c a t i o n o f an extension o f the common law
contract d o c t r i n e advocated t y Atiyah. And viewing Combe v Combe, courts might
'discover i n ' t h e (past) court's unmentioned knowledge o f the consequences ( o f tiie
r u l e i n the d e c i s i o n ) . . .a m o t i v a t i o n f o r decision which cuts deeper than any shown
by the opinion.' I n other words they may f i n d t h a t 'the available leeway i s nothing
less than huge . '-^^
.inalogical development, the s t u f f of the law, points t o a s s i m i l a t i o n by the general
squity of p r o p r i e t o r y estoppel, and there i s every i n d i c a t i o n t h a t w h i l s t Lord Denning
:remains i n the Court o f Appeal, and w h i l s t the Lords' antipathy toward i t s i n f e r i o r ' s
reformiLg zeal remains dormant i n t h i s area, i t w i l l occur. The arguments f o r maintaining
|he d i s t i n c t i o n appear a p r i o r i i n nature and not f u n c t i o n a l , f o r the p r i n c i p l e
i n d e r l y i n g Ramsden v I>yson,- Foster v Robinsonf
Binions v Evans,
Hussey v Palmer,
TIOOI Metal^"^ and Alan^^ i s , I have argued, the same, and i s not affected by the
d i f f e r e n c e i n subject-matter. I f t h i s i s indeed the case, then there seems to be no
j
reason why t h e High Trees equity should not be used to found a cause o f a c t i o n : the
courts can c l e a r l y cope w i t h such a s i t u a t i o n , as they do i n the so c a l l e d p r o p r i e t a r y
estoppel cases, and as they have done i n the e a r l i e r cases, i n Chancery. One of the
e.srly reasons, I suggested, f o r the difference between law and equity, i n t h i s regard,
w is t h a t a t common law a defendant was not heard i n h i s own defence, so t h a t a
Footnotes:
3^
(1966) 2QB617.
36
L l e w e l l y n : Some Realism About Realism kh HLR 1233. Throughout I am driven to
advocate the p r a c t i c e of Llewellyn's 'Grand S t y l e ' o f j u d i c i a l decisionmaking.
See Twining: K a r l Llewellyn*p203 e t seq.
371
'1866) LR I HL 129.
381
(1951) 1KB
39i
(1972) 2 A l l S R 70.
h0\
(1972) 3 A l l E R
iai
(1955) mR
k2\
(1972) 2 A l l S R 127.
1U9.
Ihh.
761 (HL).
<
'
lUo
ijitness against him could not be answered. I n equity, on the other hand an a l l e g a t i o n
3f a representation,
supported by the testimony of a witness could be countered \sj
3vldence sworn by the defendant himself. The
foundation f o r the d i s t i n c t i o n has since
Ijone, too, so t h a t there appears to be no reason why
the new
equity should not a f f o r d
us much p r o t e c t i o n as the o l d .
have discussed, i n the context o f Binions' and Hussey's cases the objection t h a t a
I'emedy which appears t o contemplate the creation of a new
i n t e r e s t i n land i s
imfortTinate i n complicating the p r i s t i n e s i m p l i c i t y of the 1925
J'unction of a dynamic society t h a t new
legislation. I t i s a
l e g a l remedies are sought from time to time,
£ind w h i l s t no p r o v i s i o n f o r r e g i s t r a t i o n of the equity e x i s t s , hurried l e g i s l a t i o n
i,o provide f o r i t before the courts have f u l l y worked out the implications does not
seem t o be the answer.
Consolidating l e g i s l a t i o n may be used to s i m p l i f y e x i s t i n g
law, but i t cannot a n t i c i p a t e and should not stunt future growth. I t presupposes
development by the. courts, and i n the Binions v Evans s i t u a t i o n t h i s has not happened
y s t . Moreover, f u t u r e moves may
not be analysable i n terms of i n t e r e s t s i n land, f o r
I
sich a concept may
prove too r i g i d . The desired solution must precede the l e g a l
p r i n c i p l e , which can be used as a sheet-anchor t o r e s t r a i n excesses and indicate the
possibilities.
One
primary o b j e c t i o n to the use
of the equity i n promise s i t u a t i o n s i s the absence
from some of these -of consideration.
J^y answer has been t h a t consideration as i t was
oaxiered i n the l a t t e r h a l f o f the nineteenth century was
t l i a t i t was
an impractical
aberration:
an indicium of a c e r t a i n s o c i a l view which could not survive as a blanket
resquirement a f t e r the exposure of t h a t s o c i a l view - which i n the l e g a l world might
Fc otnotess
hi
See
the preceding discussion of the case f o r l e g i s l a t i o n which followed
somewhat negative decision i n NPB
the
v Ainsworth.
P T 0
iia
have been delayed u n t i l 1932^
Since i t was the touchstone of the e n f o r c e a b i l i t y of
contracts i t has been stretched f a r beyond i t s o r i g i n a l u n i t o r y meaning and i t i s
q u i c k l y becoming a s h i b b o l e t l i whose adherents grow weary. For f o r t y years i t has
been imder regular academic a t t a c k ^ ^ and i t may be t h a t only the 'Formal S t y l e ' o f
the English j u d i c i a r y has maintained the i l l u s i o n of i t s i n t e g r i t y . Now might be the
time t o r e l i e v e i t of excess burden by a t t r i b u t i n g to i t merely i t s e a r l i e r meaning.
iMany a l t e r n a t i v e t e s t s of o b l i g a t i o n can be formulated, - though preferrably none
should be exclusive - but f o r our purposes i t remains t o r e i t e r a t e that a promissee
who has been given what the law i n i t s search f o r j u s t i c e considers a reasonable basis
f o r b e l i e v i n g i n the seriousness of a promise should be able t o enforce the promise
46
or obtain recompense t o the extent t h a t i t appears j u s t t h a t he should. For the above
reasons i t appears t o me t h a t the' law i s moving i n t h i s d i r e c t i o n , though h e s i t a n t l y
md w i t h d i f f i d e n c e .
Too tno t e s t
4?^ 5ee~Donoghue v Stevenson (1932) AC 535.
Ip*
eg W r i g h t : Ought Consideration t o be Abolished? 2LIX HLR 1225
(1936).
Gardner: An I n q u i r y i n t o the P r i n c i p l e s of the Law of Contracts XLVI HLKL (1932).
F u l l e r : Consideration and Form U l Col L R 799.
Denning: Recent Developments i n tihe Consideration Doctrine 15 MLR 1.
Chloros: The Doctrine of Consideration and the Reform of the Law of Contract
17 BllCh 127.
Von Mehren: C i v i l Law Analogues t o Consideration: A Comparative Analysis 72HLRL009.
A t i y a h : Consideration i n Contracts - A Fundamental Restatement. ANU Inaugural
Address.
See also the S i x t h I n t e r i m Report o f the Law Revision Committee 1937 Cind 5UU9.
For a defence of the doctrine see i n t e r a l i a Hamson: The Reform of Consideration
CCIIVLQR233; Unger: i n t e n t i o n t o create l e g a l r e l a t i o n s , consideration and
m u t u a l i t y 19MLR96.
iSee, Poulton: T o r t or contract 82LQR3U6. He c i t e s Lord Ellenborough i n Gorett v
Radnidge (1802) 3 East 62 a t p70:
'What inconvenience i s there i n s u f f e r i n g the p a r t y
t o a l l e g e h i s gravaman i f he please as consisting i n a breach of duty...and t o
consider t h a t as f o r t i o u s negligence instead of considering the same circumstances
as forming" or ( i m p l i e d ) breach of promise.'