Three Models of Promissory Estoppel
(2013) 7 Journal of Equity 226-249, 2014
24 Pages Posted: 29 Jul 2014 Last revised: 27 Aug 2014
Date Written: July 28, 2014
The decision in Waltons Stores (Interstate) Ltd v Maher has been widely celebrated for liberalising the doctrine of promissory estoppel in Australian law. There has, however, been considerable disagreement as to the nature and extent of that liberalisation and, on its 25th anniversary, opinions as to the effect of the decision are more sharply divided than ever. This article analyses the three different models of promissory estoppel which have been articulated and applied in Australian law since Waltons Stores v Maher: the restraint on rights model (in which promissory estoppel can operate only as a restraint on a legal right), the legal relationship model (in which promissory estoppel can arise from a promise to enter into a particular legal relationship) and the independent source of rights model (in which promissory estoppel operates as an independent source of rights, and can arise from a promise that the promisor will behave in a particular way). All three models find both support and opposition in the post-Waltons case law. It will be argued that, as a matter of consistency and justice, the independent source of rights model is to be preferred. There are no compelling reasons of justice or policy to confine the doctrine in the manner required by the restraint on rights model or the legal relationship model.
Keywords: promissory estoppel
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