These doctrines are ways of making some kinds of promise binding even where there is no consideration.

The waiver has traditionally applied where one party agrees not to enforce their strict rights under the contract by, for example, accepting delivery later than agreed. Subject to the usual principles of equity, that promise can be held binding, even without consideration. This was the position held in Hickman v Haynes (1875).

Promissory estoppel is a somewhat different doctrine than waiver and it could be said to be a development of a waiver as it is more recent. It is derived from equity and is therefore sometimes known as equitable estoppel. Promissory estoppel refers to the doctrine that a party may recover on the basis of a promise made when the party’s reliance on that promise was reasonable, and the party attempting to recover detrimentally relied on the promise. Therefore, the reliance on the promise is quite fundamental to this doctrine.

Key elements of promissory estoppel

  1. A pre-existing contractual relationship: There must already be a contractual relationship between the parties before promissory estoppel can be raised.
  • A promise: There must be an obvious and unambiguous promise not to enforce a person’s full legal rights. This promise may be implied from conduct, but silence, or failure to act, will not usually be sufficient. This was the position in China Pacific SA v Food Corp of India (1980).
  • Reliance: The promisee must have acted in reliance on the promise, in the sense that it must have influenced their conduct.
  • Inequitable to enforce strict legal rights: As an equitable doctrine, promissory estoppel will only be invoked where it would be inequitable for the promisor to go back on what was promised, and insist on their strict legal rights. Illustrations of such situations would be if the promisee cannot be restored to the position held before they acted in reliance on the promise, or if the party claiming promissory estoppel has acted in such a way that it would be inequitable to allow them to take advantage of it.

  • Future rights not destroyed: Promissory estoppel can usually only be used to prevent rights from being exercised for a period of time; it cannot destroy them forever. This was the position in Tool Metal Manufacturing Co Ltd v Tungsten Electric Co Ltd (1955).

  • No new rights created: Promissory estoppel cannot be used to create entirely new rights or extend the scope of existing ones, only to prevent the enforcement of rights already held; it has been described as being a shield and not a sword. This was illustrated in the case of Combe v Combe (1951).
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