Networked Knowledge - Law Lectures

Promises Binding in the absence of consideration

Author: Dr Robert N Moles

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Estoppel - its origins and various forms

The standard bargain theory of contract as expressed in consideration says that promises are not binding unless some price has been paid for it. The price may be a promise, or an act as well as the giving of money. However there are some circumstances where a non-contractual promise in this sense can give rise to binding obligations, although it may not give rise to a right to sue for damages if it proves to be false.

Under promissory estoppel, we will be looking at the way in which the promisee provides a way of making promises binding on the basis of reliance. The doctrine of PE is an equitable doctrine like specific performance. Like all equitable remedies, it is discretionary - in contrast to the common law absolute right to damages for breach of contract, for example.

People like Atiyah, who emphasise reliance, see this as an important part of their argument. Promissory estoppel is a relatively new development. We will look first at how the standard view has developed - through cases such as Hughes (1877) - High Trees (1947) - Legione (1983). We will then look at Walton's Stores, which departs from this standard view.

The essence of estoppel is that where you have caused the other party to act on an assumption as part of the relationship, you will not be allowed to depart from it, or act as if it were not so. You will be estopped from denying that the assumption is true. If you lead the other party to believe that you will not enforce certain rights against them, and they act on that information, assuming it to be true - you may not later go back and put those rights into effect.

Estoppel by record - some tribunal has determined some issue between the parties.
Estoppel by deed - if you execute a deed, you will be estopped from asserting that the facts stated in the deed are not true. This applies only to actions in which the deed is involved.
Estoppel by conduct - where the parties have acted on the basis of a shared understanding, which proves not to be true or where one has induced the other to act on some such assumption. We will not confuse things to much by going into these in any detail here, as promissory estoppel will be the major focus for our purposes.

Proprietary Estoppel

Now seen as part of a more general equitable estoppel. This involves doing something which a person believes will give him rights in or over land. Putting up a building or making improvements to the land. The actual owner may be estopped from denying the right or title which the other has assumed to exist.

Promissory Estoppel.

This invariably involves a promise, given by one party during the performance of a contract, not to hold the other party to the terms of the original contract. As in Foakes where the landlord says to the tenant that payment of the full rent will not be insisted upon, and a lesser amount will be accepted instead. Why should a landlord wish to do such a thing? Well, there may be problems letting shops in that area, or at that time. Of course, if the lease still has a period left to run, then the tenant is legally obliged to pay the full rent. But if the landlord fears that because the shop is not doing so well, the tenant may not be able to pay the full rent, then it may be better to accept say two thirds of the normal rent, rather than have the problem of letting the shop again. But where is the consideration for the reduction of one third? Some have said that there is none, and that if the landlord were to subsequently ask for the balance of the rent which is due, the tenant would be required to pay up.

It has been thought that this might involve an element of unfairness. That the tenant continued in occupancy of the premises, in reliance on the statements which were made, and that it should not be open to the landlord to try and get "the best of both worlds". This is where estoppel comes in - the party who makes the representation is estopped from denying the truth of the statements which were made - the statements constituting a representation with regard to a certain state of affairs, An estoppel can arise in different areas of the law - if it is in connection with property law, it is called a proprietary estoppel.

In essence an estoppel arises where one party to a contract makes a representation concerning a matter of fact, and the other party acts on that representation to their detriment. The party who has made the representation is estopped from denying the truth of that statement.

Implied undertaking may vary contractual rights

Hughes v Metropolitan Railway Co (1877) House of Lords

A tenant of property was given notice to repair certain defects within a 6 month period. During this time, the tenant thought it might be better to sell the remainder of their interest back to the landlord, rather than incur the expense of repairs. The parties did not successfully conclude an agreement to sell the interest, and it was held that whilst negotiations were taking place, there was an implied understanding that the notice period would not continue to run. The landlord’s action for ejectment for failing to repair within the stipulated period failed. It can be seen that this case did not involve a "promise" as such, but merely an "understanding" - an implied understanding is one which the court will infer from the circumstances - one which they take to be a reasonable inference.

It had been suggested that Hughes could be restricted to "relief against forfeiture" cases, but this was specifically rejected in the following cases.

Birmingham & District Land Co v London & NW Railway (1888)

A period of time laid down in a contract was held not to apply, because there was a tacit understanding that the period would not run whilst building operations were held up. The court took the view that if persons who have contractual rights against others induce by their conduct those against whom they have such rights, to believe either that such rights will not be enforced, or will be kept in suspense or abeyance for some particular time, those persons will not be allowed to enforce the rights until such time has elapsed.

One can see how this reliance based doctrine could curtail rights supposedly established on the basis of consideration. The modern doctrine of estoppel in contract law was really given an impetus by Denning J (note he was then a High Court judge) in the case which became known as High Trees. We should perhaps note here, that looking at the cases in the way in which we have done, may give a misleading impression. The earlier cases of Hughes and Birmingham were not really much talked about, until after the decision in High Trees. Because this case was particularly influential, we should understand some of the background to it.

Denning - the judge

Although Denning was only a High Court judge at the time - he subsequently became the Head of the Court of Appeal in the UK - (the Master of the Rolls). He had previously been the editor of a book called Smith's Leading Cases - the equivalent of a casebook on the earlier common law decisions. He thus knew more about some of the earlier, but not much talked about cases, than any of the other judges or barristers around at the time. Thus he could always dig out a case to support a point, more readily than the others. This could always give the impression that he was "following earlier cases" like we are told good judges should be doing. However, I have a video interview with Denning where he says that he always saw his job as being to "pick out those precedents that are rightest and to discard the rest". When the interviewer says that he didn't think that was what people thought judges should be doing, Denning said he didn't care - that was his view of it. If you want to see another case where he dug up some old stuff to support his argument which went against the contemporary view of things, look at Gallie v Lee - where Denning argued that the Court of Appeal in the UK was NOT bound by its own previous decisions.

In another interview he was asked if he didn't think that some of his decisions undermined the doctrine of consideration. At first he says, not really, in a rather halfhearted sort of way. When the interviewer presses the point, he says that perhaps they did but that he never did like the doctrine of consideration anyway. By understanding these attitudes of this important judge, we can see that the decisions in High Trees and in Ward v Byham, whilst being inconsistent at the time with the views of other judges, do amount to a consistent position on Denning's part - the move away from technicalities and artificialities of consideration to reliance and its underlying aspects of fairness. One might think that this is a position which is now being pursued more vigorously by the Australian High Court - see Walton's Stores.

If we can see that there is some basis in the earlier cases for saying that contractual rights can be limited by implied undertakings, then it is not surprising that the court will find that the contractual rights can be limited by an express undertaking - which is the position in the following case:

Express limitation of rights

Central London Property Trust v High Trees House Ltd [1947] Kings Bench

During the war the landlord of a block of flats reduced the rent for the period of the war. After the War the landlord gave notice that he would be reinstating the normal rent for the future. There was in fact no claim for back rent here, so what was said about it was strictly obiter. It is worth noting, however, it must be said that this has not diminished the significance and importance of those statements, which are often thought to be the most important aspects of the case. It goes to show that the formal status of a statement, in some of these cases, does not always affect their ultimate significance.

Denning pointed out that the doctrine of estoppel as it existed at that time required the representation which was being made, to be with regard to an existing fact. In an earlier case, it was said that a representation as to the future must either be a contract, or it is nothing. In other words, the promise that in the future, you will only have to pay half-rent, must be a promise which conforms with all those aspects which would make it a contractual promise (offer acceptance consideration, etc) or else it doesn't count at all.

But said Denning, the law has not stood still over the last 50 years. There have been cases where promises have been made which were intended to be binding, and which have been acted upon. The court has found the promise to be binding even though it may be difficult to find a consideration for it. [I emphasised those words because if it was true that at the time, the promise was intended to be binding, and only afterwards, the person who made it tries to get out of it because of the technicalities of consideration, then many would take the view that this is the sort of craftiness which leads to unfairness].

Denning went on to say that the courts have not gone so far as to give a cause of action in such circumstances, although they have refused to allow the promisor to act inconsistently with it. Hughes and Birmingham give a sufficient basis for saying that such a promise should be recognised. And then, as if to add that Pinnel's case is finally a dead duck, he said that if his view has the logical consequence that a promise to accept a smaller sum in discharge of a larger is binding, notwithstanding the absence of consideration, then so much the better.

Undertaking may be used as shield but not a sword

Combe v Combe [1951] 2 KB 215 Court of Appeal

This involved a promise by a husband to pay maintenance to his wife of £100 p.a. after the decree nisi became absolute. The wife pressed for payment, although she had obtained no formal order from the Divorce Court. The trial judge held that the promise was enforceable on the basis of High Trees [1947] because it was an unequivocal acceptance of liability intended to be binding and which was acted upon.

Denning LJ said that much as he favoured the principle of High Trees (hardly surprising given what we have just discussed), it was important that it should not be stretched too far, lest it should be endangered A clear indication, I think, that Denning wanted to consolidate the position, rather than push things too far, too quickly, and then risk losing everything by having it swept away in a backlash. The principle does not create new causes of action where none existed before.

It only prevents a party from insisting on strict legal rights where it would be unjust to enforce them having regard to the dealings which have taken place between the parties. As the principle cannot give rise to a cause of action in itself, it cannot do away with consideration when that is a necessary part of an action - it is too firmly entrenched to be overthrown by a side-wind - this presumably minimised the appearance of any threats to what were seen to be basic principles of law. . It still remains a cardinal necessity of the formation of a contract, although not of its discharge.

Denning said that it is possible that unilateral contract analysis could have been used here - the wife did an act in return for a promise - she did in fact forbear from applying to the court for maintenance [a forbearance from acting is an act? - when seen as Forbearance and Compromise] So when the judge found there was a promise intended to be acted upon and which was so acted upon, it could amount to consideration in this well-accepted sense. But difficult to say the promise was "intended to be acted upon". Sometimes consideration works injustice, but none here - the wife had larger income than the husband.

Here we clearly see Denning's view of the rights and wrongs of things influencing his legal analysis. The suggestion seems to be that the promise could not have been intended to be acted upon because the wife had a larger income than the husband. What if I attempt to use this argument to cease my car loan repayments to the bank or finance company? Well their income is certainly a good deal bigger than mine.

This case stands clearly for the proposition that estoppel may only be used as a defence - a shield but not a sword. The normal scenario is that the promisor will sue and the promisee will raise the promise which is the basis of the estoppel, as a defence. In other words, PE allows a promise (which would appear to be without consideration) to act as a limitation upon legal rights. But such a promise, it is said cannot be used as the basis upon which to establish legal rights. It can be used as the basis for a defence, but not as a basis for an action in its own right.

Walton's Stores has thrown a good deal of doubt on that.

Indicates the equitable nature of the claim

D & C Builders Ltd v Rees [1966] Court of Appeal

The builders, after completing building work sent an account which was left outstanding for some time. Eventually, D's wife agreed to pay a smaller amount provided it was accepted in full satisfaction of the debt. As the builders were in a difficult financial position, they rather reluctantly agreed to accept the money - D's wife knew that they needed the money to avoid being made bankrupt. They accepted a cheque in return for a receipt which stated "in completion of the account" which was written at the insistence of the wife. Later, they sued for the balance.

Denning MR pointed out how the recent cases had mitigated the harshness of the common law. So now a creditor can be precluded from insisting upon the legal right to the whole where it would be inequitable for the party to do so. The creditor is not bound, unless there has truly been an accord. Here there was no true accord. She used pressure - a threat to break the contract unless the other party did as she insisted - there was no equity in the D to enable her to take advantage of the equitable rule.

We should ask whether there might be an element of sexism here. Feminists might argue that it is typical of the judicial attitude to portray women who strike a good deal as being manipulative, scheming, unfair etc. See the recent case of Diprose v Louth. Was the woman here doing anything other than engaging in the sort of economic negotiations which occur every day. If we buy something in a fire sale, or because the shop is going out of business, can the shop later sue us for the full price because otherwise we would be taking advantage of them?

This is clearly the sort of case which can raise all the issues of consideration, estoppel, economic duress - if you are faced with a problem of this sort, do not just pick on one aspect of it, but be mindful of the alternatives.

When we come to Walton’s Stores we are faced with a High Court case which appears to have swept aside the sword / shield distinction. It appears to suggest that all estoppels in different areas of the law should be assimilated. The basic problem is what if the promise is made before there is a contract? If, for example, someone is about to sign an agreement with a landlord, and points to the wording of the agreement which states that pets would not be allowed. If the landlord then says, "Oh don't worry about that - I will not enforce that in your case", then should it make a difference if the promise, as here, is made before the contract comes into being rather than afterwards?

It was not until Maintiendrai in 1980, that the Australian courts clearly took up the doctrine. Most of the other common law jurisdictions took it up much earlier. The Australian Cheshire and Fifoot said that it was unnecessary, and that "consideration" could always be manufactured to do the job instead. That was not, however, the approach which was taken here.

The Australian Development of Estoppel

Legione v Hateley - - awkward facts [1983] 57 ALJR 292 High Court Aust

The first case in Australia where the doctrine of estoppel was accepted by the High Court, although the facts of the case were not very satisfactory, for they found that there was not an estoppel here. A buyer of property wanted an extension of time in order to come up with the money. They asked for but were refused an extension of time. Whilst trying to set up a bridging loan the buyer spoke to the solicitor for the seller and offered to settle on 17 August. - this would be 7 days late. The secretary at the solicitors office said "I think that will be alright, but I'll have to get further instructions." A few days later, vendor’s solicitors said that the contract had been rescinded.

The court said that a representation, to found an estoppel must be clear - this is not the same as saying that it must be express - it could be "clearly implied" from conduct. The secretary here did not make any such clear representation. Certainly no promise had been given for a further extension - there had been no statement or conduct to indicate that an indulgence would be allowed. It was not regarded as sensible or reasonable to rely on the statement by the secretary. No assurance had been given that the legal rights would not be insisted upon - the minority thought that the statement by the secretary was sufficient.

Part of the difficulty of this case was that the person who was attempting to buy the property had already built a house on it without the knowledge of the owner of the land. This might seem to be a very strange thing to do - it does not mean that the house builder had to sneek over the wall at night to do it - he could, for example, have been in previous occupation of the land under a leasing arrangement. It does mean, however, that the case also involved "relief against forfeiture" - an equitable doctrine which would prevent an injustice arising from the fact that a house had been built on the property. This part of the case was successful - again by a majority.

Doctrine accepted - good facts - what is detriment?

Je Maintiendrai Pty Ltd v Quaglia (1980) Sup Ct SA Full CT

For period of 18 months the rent on a property had been reduced. When P found out that D was about to vacate the premises, a claim was made for the full arrears. It was then a good case to test the doctrine of estoppel.

The court took the view that an estoppel could not operate unless the promisee had altered their position on the faith of the promise. A person who makes a promise which is intended to be acted upon is not prevented from resiling from that position unless in doing so, it would result in some detriment or injustice. Would entitlement to the full rent for the period elapsed work any injustice? [The argument here could easily go both ways - one could say that the tenant has had the use of the extra money and earned interest on it, so how could there be any detriment, compared - that is - to what otherwise would have been the case. On the other hand it could be argued that if the tenant thought that the difference was no longer due, then the money would be spent on other things, and to come back and ask for it now would mean that a debt had been building up without the tenant's knowledge and which could well be very difficult to pay off now.]

The court took the view that evidence re detriment was sparse - but would accept the judge's finding that accumulation of debt can be a problem. There was no doubt, however, that the promisor could revert to the original position re future payments upon giving due notice.

One of the judges took the view that detriment must not be speculative or conjectural but substantive. The evidence here failed to establish detriment. It is not established merely by the court speculating about possible alternatives and then attributing them to the party here.

By a majority, then, it was accepted that to ask now for the lump sum which was due, instead of periodic payments would give rise to undue hardship. The majority accepted that the doctrine of promissory estoppel was good, and part of the law of Australia .

Walton's Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 High Court Aust.

Mr Maher had a chance to lease his land, with a new purpose built building on it to Walton's Stores. The only snag was that before he could do this, he had to demolish the existing building on the site and actually build the new purpose built store. It was very important to Walton's that the new building be ready for opening in about 6 months time. The negotiations were overshadowed by this element of urgency.

The sequence of events was that Walton's sent a draft of the lease agreement to Maher. Walton's, at that stage, were informed that Maher had begun to demolish the old building on the site. Walton's says that the agreement must be completed within the next day or two. Their solicitor sends fresh documents incorporating agreed amendments to Maher saying that "we believe approval will be forthcoming". Maher sends the documents, executed (properly signed) by Maher, "by way of exchange". Maher then proceeds to demolish the new part of the old building in his site. Walton's were also told of this.

Walton's then decides that because of a new retailing policy, which they are in the process of formulating, not to commit itself, and to "go slow". After all, if Maher is busy getting on with things, why shouldn't Walton's keep their options open? Maher then begins the construction of the new building. It was 40% complete when Walton's tells Maher that they will not be in a position to proceed with the contract.

Obviously, Mr Maher was far from thrilled to hear this. Here he was, having demolished his own buildings, and with a new building, half completed, all to Walton's specifications. What was he to do now? A half built store is completely useless. Even if he finishes it off, would he be throwing good money after bad? He brought a case against Walton's Stores, arguing that they were estopped from denying that a contract existed. In the earlier stages of the case, it was argued on more technical aspects of common law estoppel. But as the case went up through the courts, it became clear that the High Court was willing to reconsider some of the earlier opinions about swords and shields and the like. So the basis of the argument shifted - this is one of the unusual aspects of the case. Even so, given the originality of the case, Maher met with remarkable success at all levels.

The Supreme Ct of NSW held that Walton's were estopped from denying that a contract existed.

The Court of Appeal found likewise.

The High Court - it was pointed out that the trial court judge spoke of a representation constituted by silence in circumstances where the party should have spoken. This idea of a representation by silence will come up again in later lectures.

The court of appeal spoke of knowledge of a mistake which the other labours under and does nothing to correct.

Our conclusion was that M assumed that the exchange of contracts would be concluded - not that the exchange had taken place, undermines these conclusions based on our earlier observation that an estoppel by representation must be as to an existing fact - not future conduct.

This is a shift in the argument from that presented in the earlier hearings - previously based on CL estoppel - now based on Promissory Estoppel. PE certainly extends to reps re future conduct. So far limited to situations where there is a pre-existing contractual relationship. In principle, no reason why this should not extend to a promise re enforcement of a "non-contractual" right.

This is important, for the judges are acknowledging the limitations of the earlier cases, but asking if there is any reason why they should not now push on to the next stage of development. But we should at least pause to consider the effect of such a view - if the court is now willing to enforce non-contractual rights, might it not have a longer term effect of undermining the whole distinct identity of contractual rights - might it not become difficult to see the distinction between tort and contract law for example? The High Court appears to be willing to contemplate that this is a possibility. In other words, we are not any longer making marginal changes, but basic and structural changes.

In Combe, "estoppel may be part of an action, but not the whole cause of it" Now we are asked to go one step further. Holmes J [a famous American judge writing in the earlier part of this century] said that to enforce such a promise would be to cut up consideration by its roots. Yet here, the judges were willing to argue that perhaps there is no difference in principle between changing legal rights and establishing a new one. [We might also want to say that the idea that contractual rights were clear before this is more a matter of wishful thinking - most of the issues we have looked at so far are far from clear].

Looked to American position they said that the proposition was based on the fact that (a) there was a reasonable expectation of the promisor that the promise will induce an action or forbearance and (b) the promise will be enforced where to depart from it would be unconscionable, and there is no way to enforce it by other means.

Equitable estoppel is based in unconscionable conduct - mere reliance will not bring it into play - [very important to remember this - the factor here is an INDUCED reliance - you have been warned - forget this at your peril] - it must involve the creation or encouragement of the understanding by the party estopped. In this case, the judges asked, were Walton's entitled to stand by in silence when they knew that Maher must have been proceeding on the basis that an agreement had been concluded and that completion of the documentation was a mere formality?.

Walton's were responsible for stressing the element of urgency

Walton's retained the counterpart lease without expressing any reservations, knowing that costly work was being undertaken. Their inaction here constituted a clear inducement to carry on. This was unconscionable.

Probably the clearest statement of what the case stands for can be found in the judgment of Brennan J:

A non-contractual promise can give rise to an equitable estoppel only when the promisor induces the promisee to assume or expect that the promise is intended to affect their legal relations and he knows or intends that the promisee will act or abstain from acting in reliance on the promise, and when the promisee does so act or abstain from acting and the promisee would suffer detriment by his action or inaction if the promisor were not to fulfil the promise. When these elements are present, equitable estoppel almost wears the appearance of contract, for the action or inaction of the promisee looks like consideration for the promise.

This indicates that when we are talking about this form of actionable estoppel, we have really gone beyond the boundaries of more formal views of contract. As the judge said,

Differences between a contract and such an equity - these relate to estoppel may apply irrespective of whether the party bound agrees. The equity does not need consideration. The contract depends on terms, and the equity on what is necessary to avoid that which is unconscionable.

Equitable estoppel does not make non-contractual promises contractual, and is closer to the tortious remedy of damages for negligent mis-statement or fraud.

This case is probably a clear indication that the view so loved of lawyers in the soapies and films - of the smart lawyer, who comes up with the clever technicality at the end of the day - is likely to become even more a matter of fiction than it ever was.

This case was not applied in Austotel v Franklins (1989) 16 NSWLR 582 where there were commercial bodies with equal bargaining power and access to advice.

Equitable estoppel does not make non-contractual promises contractual, and is closer to the tortious remedy of damages for negligent mis-statement or fraud.

Commonwealth v Verwayen (1990) 170 CLR 394 High Court (HH 242)

Appeal from Supreme Court Victoria

In 1964 the ship Melbourne collided with and sank the ship Voyager whilst they were engaged in combat exercises. The general view was that the Commonwealth did not owe a duty of care in such circumstances and thus would not be liable (the Groves defence). By 1984, there was some doubt about this, and Verwayen, a member of the RAN sued for damages. The Commonwealth admitted liability, did not plead Groves or Statute of Limitations, saying that it was not its policy to take advantage of either. In 1986, this policy changed and the Commonwealth sought to take advantage of both. V said that they had waived their right to these defences. The issue before the High Court was dealt with on the basis of estoppel.

Promissory estoppel, recognised by this court in Legione v Hateley (1983) undermined the idea that voluntary promises cannot be enforced in the absence of consideration. PE has extensive operation, now that it is recognised that it is not restricted to pre existing contractual relationships – Walton’s (1988). It recognises that the distinction between present and future fact is unsatisfactory and produces arbitrary results. These developments have brought greater underlying unity to estoppels. The trend of modern decisions points inexorably to one doctrine of estoppel, rather than a series of them.

Estoppel by conduct was seen as an evidentiary principle, and prevented a person from departing from an assumption of fact - but equitable estoppel has expanded and recognises that an assumption with regard to future fact may ground an estoppel and has taken the principle from being evidentiary to being a substantive doctrine.

The result is that it should be accepted that there is but one doctrine of estoppel, which provides that a court may do what is required to prevent a person who has relied upon an assumption (present, past or future) after being induced to do so by the other from suffering detriment in reliance upon it. There must be proportionality between remedy and detriment. The assumption may be with regard to legal as well as factual matters.

In this case, was the assumption induced by the Govt? Pleadings alone would not be sufficient. Here, there was more than that, so that Commonwealth did induce the belief that the limitation and Groves defence would not be pleaded and the decision with regard to that would not be changed.

Here, to hold the Commonwealth to representations which would deprive it of defences which were available to it by statute or general law, would be a disproportionate response. An order for costs may be sufficient to meet prejudice in terms of expense and inconvenience occasioned by the need for pleading new defences.

Estoppel. Walton’s held that equitable estoppel yields a remedy in order to prevent unconscionable conduct on the part of the party who, having made a promise to another who acts on it to his detriment, seeks to resile from it. To effect "the minimum equity to do justice".

Scutiate Savings Bank (1884)

Holmes J It would cut up the doctrine of consideration by the roots, if a promisee could make a promise binding by subsequently acting in reliance on it. Quoted in Walton's.

Novation

A transaction by which with the consent of all the parties, a new contract is substituted for one that has already been made.

Mistake and withdrawal of undertaking

William A Drennan v Star Paving Co (1958) 333 P 2d 757 Supreme Court of California, Full Court.

P was preparing a tender for the construction of a school. Intending sub-contractors telephoned P giving their tenders for their specific parts of the work. On the basis of those figures, P prepared their tender, and were awarded the contract. D had tendered for his part at $7131, but later refused to do it for less than $15,000. P got another firm to do it for $10, 948. P sued and recovered the difference. D appealed.

HELD A promise which the promisor should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee and which does induce such action or forbearance is binding if injustice cannot be avoided in any other way. The purpose of the relevant legislation here, is to make a promise binding even where there is no consideration. P committed itself in reliance on Ds figures. D's mistake should not relieve, because it seriously misled P.

Here, damages were granted in lieu of specific performance, and it may be thought that what we have here is an equitable route to damages. It may be then that Walton's v Maher sees the beginning of the end for consideration, although the judges in the case said that this was not their intention.

Perhaps the wider principle is the issue of unconscionability - this has to be weighed in balance with the need for formalities for a contract involving an interest in land. It could be said that everyone knows the rule in land deals. Both parties had solicitors and if they want to get going early, they know the risks and they do so at their own risk.

It is clear that Walton’s v Maher goes well beyond the English cases in this matter.

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