remedies which the law provides for breach of contract supposedly serve to place the party not in breach in the position he would have been in had the promise been performed. In contrast, many reliance based obligations arise by operation of law through the medium of tortious duties to exercise reasonable care. Here the basis of any award of damages is to return the injured party to the position he was in before the defendant’s wrong was committed. As such, the interest protected is not one of expectation of performance, but instead the status quo interest – the claimant is compensated so as to restore the status quo before the defendant committed his wrong. While many reliance based obligations do involve the protection of the status quo interest, it should not be assumed that this is always the case. In particular, it should not be assumed that expectations of performance are entirely irrelevant where a promisee has reasonably relied upon the promise of the other party. Statements other than purely contractual promises are also capable of engendering expectations in another person. Much of the difficulty associated with identifying the interest protected when promises which induce reliance are enforced arises from the view in Combe v Combe that the doctrine of promissory estoppel operates as a shield rather than as a sword. However it has been seen that there may be circumstances in which the courts may allow certain varieties of estoppel to be used as a means of creating new rights where none previously existed, so as to adequately protect the equity raised in favour of the promisee resulting from his reasonable reliance on the promise of the other party. Thompson identifies the main arguments in support of the view that reliance upon a non-contractual promise may now protect the promisee’s expectation interest:

doi:10.4324/9781843141518-78

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remedies which the law provides for breach of contract supposedly serve to place the party not in breach in the position he would have been in had the promise been performed. In contrast, many reliance based obligations arise by operation of law through the medium of tortious duties to exercise reasonable care. Here the basis of any award of damages is to return the injured party to the position he was in before the defendant’s wrong was committed. As such, the interest protected is not one of expectation of performance, but instead the status quo interest – the claimant is compensated so as to restore the status quo before the defendant committed his wrong. While many reliance based obligations do involve the protection of the status quo interest, it should not be assumed that this is always the case. In particular, it should not be assumed that expectations of performance are entirely irrelevant where a promisee has reasonably relied upon the promise of the other party. Statements other than purely contractual promises are also capable of engendering expectations in another person. Much of the difficulty associated with identifying the interest protected when promises which induce reliance are enforced arises from the view in Combe v Combe that the doctrine of promissory estoppel operates as a shield rather than as a sword. However it has been seen that there may be circumstances in which the courts may allow certain varieties of estoppel to be used as a means of creating new rights where none previously existed, so as to adequately protect the equity raised in favour of the promisee resulting from his reasonable reliance on the promise of the other party. Thompson identifies the main arguments in support of the view that reliance upon a non-contractual promise may now protect the promisee’s expectation interest:

ABSTRACT

According to the orthodox model of contract, unless a promise is made under seal, it will be unenforceable unless the promisee either does, or promises to do, something in return. This bargain theory of contract has been subjected to searching criticism, however, by Professor Atiyah. He sets out, in full, the orthodox account of the doctrine of consideration which, he then argues, is not borne out by case law. His general thesis is that consideration is merely a reason for enforcing a promise but not the only reason. Instead, he insists, promises are enforced in various circumstances for other reasons, but when consideration in the orthodox sense is absent. As a classic example of this is the following situation: ‘The promisor does not state any act which is to be performed by the promisee but the promisee does act in reliance on the promise in a way which was the natural and foreseeable result of the promise.’ This, as Atiyah points out, is not regarded by orthodox theory as a contract but, nevertheless, one finds the promise enforced in certain circumstances. Central to this argument is his analysis of Jorden v Money. He argues that P’s marriage in reliance on the representation that the bond would not be enforced was actually a contract, albeit unenforceable due to the Statute of Frauds. With

respect, it is submitted that this is not so. It is clear from the speech of Lord Cranworth that the case was argued on the basis of a representation of intention, which the House of Lords held was not actionable unless it was contractual.