Australian Estoppel: Filling the Doctrinal Lacuna in Induced Assumptions, Study notes of Law

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AUSTRALIAN ESTOPPEL

AND THE PROTECTION OF RELIANCE

Michael Spence

St Catherine's

College

Michaelmas Term

Thanks are dueto my supervisors,

Mr. J.D. Davies and Professor G.H. Treitel

for

their helpin the preparation

ofthis thesis. Thanks are dueto my wife, Beth,

for

herhelp in all things.

TABLE OF CONTENTS

Table ofCases vi

Bibliography

xvii

PROLOGUE

PART ONE: THE PROBLEM OF RELIANCE UPON INDUCED ASSUMPTIONS:

THE ANTECEDENT ANGLO-AUSTRALIAN APPROACH

ChapterOne: The Duty and itsJustification

(1) The Duty 9

(2) Distinguishing the Duty from the Duty to Keep Promises

and the Duty Notto Lie

(3) Justifying the Duty 15

(4) Is the Duty Worthy

ofLegal Expression? 19

Chapter Two: The Duty in Antecedent Anglo-Australian Law

(1) The Aim and Scope

ofthis Survey 22

(2) Negligent Misstatement

(3) Misrepresentation

(4) Other Equitable Relief 33

(5) Estoppel

Chapter Three: Introducing the Four Lacunae

(1) Pre-Contractual Negotiations and Letters of Intent

(2) Firm Offers in the Construction Industry

(3) VariationsofContract Unsupported by Consideration

(4) The "Battleof Forms"

IV

PART TWO: THE EMERGENT DOCTRINE OF AUSTRALIAN ESTOPPEL

Introductionto

Part Two 64

(1) TheDecisions inWaltons Stores (Interstate)Ltd vMaher and

Verwayen v The Commonwealth 66

(2) The Methodology

ofthePart 70

ChapterFour: The ElementsofAustralian Estoppel

(1) Australian Estoppel is

a SingleDoctrine ofCommon Law and

Equity... 77

(2) Ableto beUsed Eitheras a Cause ofAction or Defence... 82

(3) Between Two Parties NotNecessarily in any Kind of

Pre-Existing Relationship.

(4) To Establish an Estoppel,

OneParty, A, (orhisPrivy?)... 87

Must Show that he has Held an Assumption... 89

(6) Regarding the Present or theFuture, Fact or Law... 95

And that hehas Acted orRefrained from Acting... 99

(8) In Reliance Upon that Assumption...

(9) To His Detriment. 103

(10) A must also show that the

Other Party, B, (orhis Privy?)... 107

(11) Induced the Relevant Assumption...

(12) And that, Having Regard to

a Number ofSpecified Considerations,

it would be Unconscionable forB notto Remedy the

Detriment that

A has Suffered by Relying Upon the Assumption.

When these things are Established the Court May Award a Remedy

Sufficient to Reverse the Detriment thatA has Shown. 130

(14) Defences.

Chapter Five: Australian Estopepl as "Discretionary"

(1) Australian Estoppel as Discretionary: Desirability

and Dangers 144

(2) The Certainty Problem: The Type

of"Discretion" that Australian

Estoppel Entails 146

(3) The Certainty Problem: Australian Estoppel

as Balancing "Lawyers'"

and "Community" Certainty

Chapter Six: Australian Estoppel, Contract, Tort and

Restitution for Unjust

Enrichment

(1) Australian Estoppel and Contract

Australian Estoppel and Tort 166

(3) Australian Estoppel and Restitution for Unjust Enrichment

VI

TABLE OF CASES

A full reference is given for each case in this table and at its first citation. Subsequent citations give the

name of the case and the year in which it was decided.

A.N.Z. Banking Group Ltd v Widin

(1991) 102 A.L.R. 289 135

Alien M. Campbell Co. v Virginia Metal Industries

708 F.2d 930 (1983) 57

Amalgamated Investment and Property Co. v Texas Commerce International Bank

[1982] 2 Q.B. 84 5,38,

Amann Aviation Pty Ltd v Commonwealth of Australia

(1991) 100 A.L.R. 267 (1991) 174 C.L.R. 64 110

Andrf & Cie S.A v Ets Michel Blanc & Fils

[1977] 2 Lloyd's Rep. 166 33

APCO Amusement Co. v WiVdns Family Restaurants of America Inc.

673 S.W.2d 523 (1984) 52

Aramis, The

[1989] 1 Lloyd's Rep. 213 178

Archbolds (Freightage) Ltd v S. Spanglett Ltd

[1961] 1 Q.B. 374 138

Argy Trading v Lapid Development Co.

[1977] 1 W.L.R. 444 26

Atlas Express Ltd v Kafco (Importers & Distributors) Ltd

[1989] Q.B. 833 228

Att.-Gen. of Hong Kong v Humphrey's Estate (Queen's Gardens)

[1987] 1 A.C. 114 77, 128

Austotel Pty Ltd v Franklins Set/serve Pty Ltd

(1989) 16 N.S.W.L.R. 582 52, 71, 78, 90, 91, 102, 103, 111

124, 131

Australian Broadcasting Commission v XTV Commonwealth Games Ltd

(1988) 2 B.R. 318 102, 128, 129

Australian Continental Resources Ltd, Re

(1976) 10 A.C.T.R. 19 41

Austral Standard Cables Pty Ltd v Walker Nominees Pty Ltd

(1992) 26 N.S.W.L.R. 524 105, 114

Avtex Airservice Pty Ltd v Bartsch

(1992) 107 A.L.R. 539 80, 110, 123

B & S Contracts & Design Ltd v Victor Green Publications Ltd

[1984] I.C.R. 419 228

B.R.S. v Arthur V. Crutchley & Co.

[1968] 1 All E.R. 811 236

BT Australia v Raine & Home

[1983] 3 N.S.W.L.R. 221 5

Banque Brussels Lambert S.A. v A.N.I. Ltd

Supreme Court of New South Wales, 12 December 1989, unreported 157

Basham, Re

[1986] 1 W.L.R. 1498 101

Bobko v Commonwealth of Australia

Supreme Court of Victoria, 22 April 1988, unreported 85, 86, 144

Bond Brewing New South Wales Ltd v Reffell Party Ice Supplies Pty Ltd

Supreme Court of New South Wales, 9 September 1987, unreported 133

Borg-Worner Corp. v Anchor Coupling Co.

156 N.E.2d 513 (1958) 52

Box v Midland Bank Ltd

[1979] 2 Lloyd's Rep. 391 50

Vll

Bremer Handelgesellschqft m.b.H. vDeutsche Contihandelgesellschqft m.b.H.

[1983] 1 Lloyd's Rep. 689

99

Brewer Street InvestmentsLtdvBarclay's WoollenCo. Ltd

[1954] 1 Q.B. 428

174, 175, 176, 178, 179, 181, 182, 183

184, 187, 188, 189, 190, 191, 192, 195

197

Brikom Investments vCarr

[1979]Q.B. 467

38, 101, 102

BritishSteelCorp. v Cleveland Bridge&Engineering Co.Ltd

[1984] 1 AllE.R. 504

50, 174, 175, 177, 183, 197, 198,

199

Buchananv Brook Walker& Co.Ltd

[1988] N.I. 116

236

Burnside Sub-Branch R.S.S.I.L.A. vBurnside Memorial Bowling

ClubInc

(1992) 58 S.A.S.R. 324

97

Burrowes vLock

(1805) 10 Ves. 470

34

Butler Machine Tool Co. LtdvEx-Cell-OCorp. (England)Ltd

[1979] 1 W.L.R. 401

59, 236, 237, 238, 239, 240, 241, 242

243, 244, 245, 246, 247, 248, 249, 250

C.R.A. LtdvN.Z. Goldftelds Investments

[1989]V.R. 870

124

CairnsFestival Faire PtyLtdvA.E.F.C. Ltd

[1993] A.C.L. Rep 110 F.C. 7

103

Canadian &Dominion SugarCo.LtdvCanadian National(West Indies) SteamshipsLtd

[1947]A.C. 46

92

Caparo Industries Picv Dickman

[1990] 2 A.C. 605

5

CentralLondon Property TrustLtdv High Trees HouseLtd

[1947]K.B. 130

36, 64

CitraConstructions LtdvAlliedAsphalt Co. PtyLtd

Supreme CourtofNewSouth Wales, 28 March1990, unreported 85, 105, 106, 172, 221

231, 232

Chichester JoineryLtdv John Mowlem& Co. pic

(1987) 42 Build. L.R. 100

236

ReChristieandFerdinando

Federal CourtofAustralia, 30 Aprill 1993,unreported

125

Coghlan v S. H. Lock(Aust)Ltd

(1985) 4 N.S.W.L.R. 158

114

Colgate Palmolive PtyLtdv Rexona

(1981)A.T.P.R. 540-

155

Collin v Holden

[1989]V.R. 510

85, 86, 141

Combe vCombe

[1951] 2 K.B. 215

82

Commercial BankofAustraliav Amadio

(1983) 151 C.L.R. 170

125

Commonwealth ofAustralia v Clark

[1994] 2 V.R. 333

71, 72, 74, 107

Commonwealth ofAustralia vVerwayen

(1990) 1790 C.L.R. 394

7, 38, 65, 66, 68, 69, 70, 71

72, 78, 79, 81, 82, 83, 84, 85, 86, 87

96, 97, 104, 105, 106, 107, 110, 111

112, 120, 122, 125, 130, 131, 132,

133

135, 136

Con-Stan Industries ofAustralia v Norwich Winterthur Insurance (Australia)

Ltd

(1986) 160 C.L.R. 226

38, 64, 96, 97

Construction Design &Management Ltd v New Brunswick Housing Corp.

(1973) 36 D.L.R. (3d) 458

174, 176, 177, 187, 191, 192, 193

Constructors Supply Co. v Bostrom Sheet Metal Works

190 N.W.2d (1971)

57

IX

Foran

vWight

(1989) 168 C.L.R. 385

80, 81,97, 169

Francis

v Francis

[1952]V.L.R. 321

140

GallaghervPioneerConcrete(N.S.W.)Pty

Ltd

(1993) 113 A.L.R. 159

89

GardnervCommissionerofProbateDuties

[1967]W.A.R.

106

41

Gollin& Co.LtdvConsolidated Fertilizer

Sales PtyLtd

[1982] Qd R. 435

41, 65

Goss vLordNugent

(1833)

B. & Act. 58

57

Greasley

vCooke

[1980] 1 W.L.R.

1306

47, 101

Green vGreen

(1989) 17 N.S.W.L.R. 343

110

GreenwoodvMartins Bank

[1932] 1 K.B. 371, [1933]A.C. 51

45, 111

Griffiths v Williams

[1978] E.G.D.

919

37

Grundt v Great

BoulderPty Gold MinesLtd

(1937) 59 C.L.R. 641

42, 65,

78, 93, 104, 114, 120

Gundersen

&Son v Cohn

596 F.Supp. 379

(1984)

52

Hamilton v Geraghty

(1901) 1 S.R. (N.S.W.)

Eq. 81

133

Hammersley vDeBiel

(1845) 12 Cl. & Fin. 45

35

Hawkins v Clayton

(1988) 164 C.L.R.

539

31

MedleyByrne& Co.

Ltdv Heller&PartnersLtd

[1964]

A.C. 465

23, 24,

25

Henderson vMerrett Syndicates

Ltd

[1995] 2 A.C. 145

5

Hewlett

vLondonCounty Council

(1908) 24

T.L.R. 331

102

Hexagon v Australian Broadcasting Commission

(1975) 7 A.L.R. 233

38, 65

HillvMoore

Supreme

CourtofNew South Wales, 31 August1990,

unreported 133

Hocking v Western Australian Bank

(1909)

9 C.L.R. 738

102

HoffmanvRedOwl Stores

Inc.

133 N.W.2d 267 (1965)

52, 53

Holiday InnsIncv Broadhead

(1974) 232E.G. 961 and 1087

50, 52, 91,

93

Holman Construction

Ltdv Delta TimberCo. Ltd

[1972]N.Z.L.R. 1081

54

Hornsby Building Information

Centre PtyLtdv Sydney Building Information

Centre PtyLtd

(1982)A.T.P.R.

140-

154

Howard Marine v

Ogden

[1978] Q.B. 574

25

Inn Leisure Industries Pty LtdvD.F. McCloy Pty

Ltd

(1991) 100 A.L.R. 447

97

Inwards v Baker

[1965] 2 Q.B. 29

90

James Baird Co.

v Gimbel Bros.

64 F.2d 344 (1933)

207

Janke Construction

Co. v Vulcan Materials Co.

527 F.2d 772 (1976)

57

Jaybe Construction Co. v Beco Inc

216 A.2d 208 (1965) 57

Je Maintiendrai Pry Ltd v Quaglia

(1981) 26 S.A.S.R. 101 41

Jennings & Chapman Ltd v Woodman, Matthews & Co.

[1952] 2 T.L.R. 409 174, 175, 176, 184, 187, 188, 190, 191

Johnson Matthey Bankers Ltd v State Trading Corp. of India Ltd

[1984] 1 Lloyd's Rep. 427 59

Jorden v Money

(1854) 5 H.L.C. 185 81

Junior Books Ltd v Veitchi Co. Ltd

[1983] 1 A.C. 520 31

K. Lokumal & Sons (London) Ltd v Lotte Shipping Co. Pty Ltd

[1985] 2 Lloyd's Rep. 28 114

Kammins Ballrooms Co. Ltd v Zenith Investments (Torquay) Ltd

[1971] A.C. 850 38

Keen v Holland

[1984] 1 All E.R. 75 114

Kennedy v Panama, etc., Royal Mail Co. Ltd

(1867) L.R. 2 Q.B. 580 32

Kenneth Allison Ltd v A.E. Limehouse & Co.

[1992] 2 A.C. 105 114

Kintominas v Secretary, Department of Social Security

(1991) 103 A.L.R. 82 88

Kok Hoong v Leong Cheong Kweng Mines Ltd

[1964] A.C. 993 138

Legione v Hateley

(1983) 152 C.L.R. 406 38, 41, 64, 85, 125

Les Edwards & Son Pty Ltd v Commonwealth Bank of Australia

Supreme Court of New South Wales, 14 June 1990, unreported 120

Loffus v Maw

(1862) 3 Giff. 592 35

Lorimer v State Bank of New South Wales

[1991] A.C.L. Rep 325 N.S.W. 95 71, 80, 82, 97, 105, 106

Low v Bouverie

[1891] 3 Ch. 82 34

Lyon Metal Products v Hagereman Construction Corp.

391 N.E.2d 1152 (1979) 57

Mac Fisheries v Harrison

(1924) 93 K.B.D. 811 102

Maclsaac & Menke Co. v Freeman

15 Cal. Rptr 48 (1961) 201, 203, 211, 212, 214, 215, 216, 217

Maddison v Alderson

(1883) 8 App. Cas. 467 35, 140

Mansell v Hedges

(1854) 4 H.L.C. 1039 35

Maritime Electric Co. v General Dairies Ltd

[1937] A.C. 610 138

McGrath v Fraser

(1991) 104 F.L.R. 227 80

McPhillips v Ampol Petroleum (Victoria) Pty Ltd

(1990) A.T.P.R. 141-014 110

Marvon Pty Ltd v Yulara Development Co.

(1989) 98 F.L.R. 348 123

Milchas Investments Pty Ltd v Larkin

(1989) A.T.P.R. 140-956 102, 107

Monks v Poynice Pty Ltd

(1987) 8 N.S.W.L.R. 662 75

Montgomery Industries International v Thomas Construction Co.

620 F.2d 91 (1980) 57

Xll

RobertGordonInc. v Ingersoll-Rand

117 F.2d 654 (1941) 201, 202, 209, 210, 211, 214, 215, 216

217

RobinsonvHarman

(1848) 1 Ex. 850 31

RoebuckvMungovin

[1994] 2A.C. 224 70

Ross vCounters

[1980] 1 Ch. 297 31

Routledge vGrant

(1828) 4 Bing. 653 200

Royv Waterton

(1989)A.N.Z. Convey. Rep. 528 110

RutterfordLtdvAlliedBreweries

[1990]S.C.L.R. 186 236

S.N. NielsenCo. vNational Heat&PowerCo.

337 N.E.2d 387 (1975) 57

SabemoPtyLtdvNorth SydneyMunicipalCouncil

[1977] 2 N.S.W.L.R. 880 50, 174, 176, 177, 178, 179, 181, 183

186, 187, 191, 192, 193, 195, 196

Saliba-KringlenCorp. vAlienEngineering Co.

92 Cal. Rptr 799 (1971) 57

Salisbury(Marquess) vGilmore

[1942] 2 K.B. 38 29, 30

San Sebastian PtyLtd v Minister Administering the Environmental PlanningandAssessmentAct 1979

[1986] 162 C.L.R. 340 5

Sauter AutomationLtdv Goodman (Mechanical Services)Ltd

(1986) 34 Build.L.R. 81 236

Scaptrade, The

[1983] 2A.C. 694 101

SelectmoveLtd, Re

[1995] 1 W.L.R. 474 224

Shaddock v Parramatta City Council

(1981) 150 C.L.R. 225 25, 26, 31

Sheahan v Worker's Rehabilitation andCompensation Corp.

(1991) 56 S.A.S.R. 193 230

Siboen, The& TheSibotre

[1976]Lloyd'sRep. 293 228

Siloviv Barbara

(1988) 13 N.S.W.L.R. 466 68, 77, 78,88, 90, 108, 109, 130

133, 138, 139

Slim v Croucher

(1860) 1 De G.F.&J. 518 34

Smith v Bush, Harris v Wyre ForestDC

[1990] 1 A.C. 831 5

Societe Jtalo-Belgepourle Commerce et Vlndustrie v Palm andVegetable Oils (Malaysia) Sdn. Bhd.

[1982] 1 AllE.R. 19 5, 38

Spiro v Lintern

[1973] 1 W.L.R. 1002 38

Spring v Guardian Assurance

[1995] 2 A.C. 296 5

Standard Chartered Bank Australia v BankofChina

(1991) 23 N.S.W.L.R. 164 93

State Government Insurance Commission v J.M. Insurance Pty Ltd

(1984) A.T.P.R. 140-465 155, 156

Stefanou v Fairfield Chase Pty Ltd

Federal Court of Australia, 10 December 1993, unreported 124, 125

Stephens v Venables (No. 2)

(1862) 31 Beav. 124 35

Sterns Trading Pty Ltd v Steinman

(1988) A.N.Z. Convey. Rep. 528 110

xm

Stevens v StandardCharteredBank

(1988) 53 S.A.S.R. 323 82

StilkvMyrick

(1809) 2 Camp. 317 58, 223

Stolt Loyalty, The

[1993] 2Lloyd'sRep. 281 5, 38

Sydney Strata Securities PtyLtdvElders FinanceLtd

[1991]A.C.L.Rep 45 F.C. 1 110

TaylorsFashionsLtdvLiverpool Victoria Trustees Co.Ltd

[1982]Q.B. 133 5, 38

Texaco Inc. vPennzoilCo.

626 F. Supp.250 (1986), 784 F.2d 1133 (1988) 51

Thompson vPalmer

(1933) 49 C.L.R. 507 65, 78, 104, 110

Thomson v Simpson

(1870)L.R.Eq. 497 35

TieRack(Aust.) PtyLtdvInglon PtyLtd

(1989) Convey. Rep. 155-456 110

TuriffConstructionLtdv Regalia Knitting MillsLtd

[1972] E.G.D 257 52

Tyersv Rosedale&Ferryhill Iron Co.

(1873)L.R.Exch. 308 58

Typing CentreofNew SouthWalesPtyLtdv Northern Business CollegeLtd

(1989)A.T.P.R. J40-943 155, 156

UniroyalLtdvMiller& Co. Ltd

[1985] S.L.T. 101 236

United OverseasBankvJiwani

[1976] 1 W.L.R. 964 101

UpdateConstructions PtyLtd v Rozelle ChildCare CentreLtd

(1990) 20 N.S.W.L.R. 251 169, 170

Verwayen vTheCommonwealthofAustralia(No.2)

[1989]V.R. 712 72

Walford vMiles

[1992] 2 A.C. 128 174

Walters vMorgan

(1861)3 DeG. F.& J. 718 110

Waltons Stores (Interstate)LtdvMaher

(1987-1988) 164 C.L.R. 387 6, 29, 36, 38, 65, 66, 67, 68

70, 71, 77, 78, 79, 80, 81, 82, 83

84, 85, 96, 97, 101, 104, 105, 110

111, 112, 120, 122, 123, 127, 129

130, 133, 134, 135, 140, 141, 142

162, 168, 169, 189

Ward vByham

[1956] 1 W.L.R. 496 230

Ward v James

[1966] 1 Q.B. 273 146

Ward v Kirkland

(1967) Ch. 194 133

Wargo Builders Inc. v Douglas L. Cox Plumbing&Heating Inc.

268 N.E.2d597 (1971) 57

Webb Distributors (Aust) Pty Ltdv Victoria

(1993) 67 A.L.J.R. 961 139

Weiss v Barker Gosling

[1993] 16 Fam. L.R. 728 124, 125

Welch vO 'Brian Financial Corp.

(1992) 86 D.L.R. (4th) 155 123

William Lacey (Hounslow) Ltdv Davis

[1957] 1 W.L.R. 932 50, 52, 174, 176, 177, 178, 179, 180

183, 184, 187, 191, 192, 193, 194, 195

XV

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