Promissory Estoppel - Tutorial 3 Can some promises still be binding even when they're not supported by consideration. Central London Property Trust Ltd v High Trees House Ltd: High Court Emergence of PE Facts:In1937HighTreesHouseLtd.leasedablockofflatsforarate £2,500/year from Central London Property Trust Ltd. Due to the war and the resultant heavy bombing of London occupancy rates were drastically lower than normal. In January 1940, to ameliorate the situation the parties made an agreement in writing to reduce rent by half. However, neither party stipulated the period for which this reduced rental was to apply. Over the next f i ve years, High Trees paid thereducedratewhiletheflatsbegantofillandby1945,theflatswere back at full occupancy. Central London sued for payment of the full rental costs from June 1945 onwards. Importance: Reaf f i rmed and extended the doctrine of promissory estoppel in English contract law. Given modern ef f ect to estoppel. Attempts have been made to utilize the doctrine of promissory estoppel after High Trees to create a new inroad into the rule in Pinnel's case that an agreement to accept part payment of a debt in full satisfaction of it is unenforceable for want of consideration. In the High Trees case Lord Denning commented, obiter, that such an agreement should now be enforceable under the doctrine of promissory estoppel. However, the courts have traditionally been reluctant to overrule cases like Pinnel's case and Foakes v Beer as they have formed part of the common law for so long. Lady Justice Arden in Collier v P & MJ Wright (Holdings) Ltd accepted in principle that High Trees could be used to extinguish a creditor's right to full payment of a debt in such circumstances.
Judgment: Based on previous judgments as Hughes v Metropolitan Railway Co, Denning J held that the full rent was payable from the timethattheflatsbecamefullyoccupiedinmid-1945.However,he continued in an obiter statement that if Central London had tried to claim for the full rent from 1940 onwards, they would not have been able to. This was reasoned on the basis that if a party leads another party to believe that he will not enforce his strict legal rights, then the Courts will prevent him from doing so at a later stage. Being obiter dicta, this remark was not actually a binding precedent, yet it essentially created the doctrine of promissory estoppel. The court reasoned that the rent waiver was only meant to cover the wartime period. Therefore, it was not unjust to raise the rent back to the original amount after the war, when the defendant was able to pay it again. A party who has made a waiver af fecting an executory portion of the contract may retract the waiver by reasonable notif i cation received by the other party that strict performance will be required of any term waived, unless the retraction would be unjust in view of a material change of position in reliance on the waiver. -> A promise was made that intended to cause legal relations that was acted upon so as