The case of Central London Property Trust v High Trees House Ltd, where A landlord informed a tenant that, during the course of the war, that the rent would be reduced. The landlord company went into receivership. The receiver noted that the reduced rent had been paid for some 5 years and demanded the sum that had been unpaid. A test case was brought to see if the landlord's promise to reduce the rent was legally enforceable. The principle of promissory estoppel is demonstrated to be, in this case, that it does not grant new causes of action to the promisee where none previously existed. This idea involves the suspending of the promisor’s full legal rights and this use of promissory estoppel has sometimes been doubted or ignored in later dicta, the primary reason for this being that in English law consideration is usually required to create new legal rights, but “it is not necessarily needed for their modification or discharge,” thus demonstrating that promissory estoppel supplies the promisee with a shield of protection as opposed to a sword.
In the case of Combe v Combe Lord Denning expanded his inturpretation of promissory estoppel by refusing to allow its use as a "sword" by an ex-wife to extract funds from the destitute husband. Lord Denning stated that “where one party has, by his words or conduct, made to the other a promise or assurance which was intended to affect the legal relations between them and to be acted on accordingly, then, once the other party has taken him at his word and acted on it, the one who gave the promise or assurance cannot afterwards be allowed to revert to the previous legal relations as if no such promise or assurance had been made by him. He must accept their legal relations subject to the qualification which he himself has so introduced, even though it is not supported in point of law by any consideration but only by his word.” This case demonstrates that the principle highlighted in the High Trees case “does not create new causes of action where none existed before.” Lord Denning goes on further to reinstate that “it only prevents a party from insisting on his strict legal rights when it would be unjust to allow him to do so having regard to the dealings which have taken place between the parties.” In this way promissory estoppel cannot be used as a sword against another and affirms its use as a shield to protect people from unjust harm rather than to be used as a weapon against another. This case demonstrates how promissory estoppel is implemented as a shield in the English legal system.
The effect that promissory estoppel has on the promisee’s position is that although the promisee need not provide any consideration for the promisor’s promise they cannot sue on that promise, as they have not given any consideration. In this way the doctrine of promissory estoppel cannot be used as a cause of action in itself as it does not act in a way that it confers new rights on the promisee, it only operates to prevent the promisor from fully enforcing their rights against the promisee, and in this way it acts as a shield, not a sword.
The effect of promissory estoppel on the legal rights of the promisor is, in effect, to “suspend but not fully extinguish the promisor’s strict legal rights,” enabling those rights to be re-established and resumed. This can only take place once reasonable notice has been given to the promisee of the intention of their plans and providing that the promisee is able to resume their previous position. In this way promissory estoppel ensures that the promisee is shielded from any unfair dealings of the promisor but the promisor is not in danger of any reverse action such as being sued.
The statement “promissory estoppel may be used as a shield but not a sword,” a well as being the most famous in reference to the use of promissory estoppel, is also very apt in the description of the way in which promissory estoppel works. However in his article “The offensive limits of promissory estoppel,” Roger Halson claims that such metaphors and language can be confusing. He sees the statement as being “vivid” and he believes that language like this “often conceals subtle shades of meaning.” This view demonstrates that although this maxim is highly relevant to the field to promissory estoppel and can help to gain an understanding of the way in which it should be used, it also fails to describe or even imply the offensive limits of the doctrine and offers no basis to guide the doctrines future development. In other words, the rigid nature of a statement such as this fails to consider its own evolution.
The idea that promissory estoppel acts as a shield, not a sword, is to a great extent, true in relation to English law. In the English law the court will do what is “necessary, but not more, to prevent a person who has relied upon such an assumption, promise or representation from suffering detriment.” And in this way a promisee is protected by the shield of the law, but as the court will do no more than that the have no sword with which to attempt any kind of counter attack directed at the promisor.
In the case of repayment of a debt the doctrine of promissory estoppel does not apply when one party offers to accept a lesser payment for the full payment of a debt which is owed to them, unless that is if the debtor offers to pay the lesser amount at an earlier date than was previously agreed, thus demonstrating consideration for the promise. In this way promissory estoppel cannot act as a shield against the promisor as no consideration has been shown and there are not grounds which cause promissory estoppel to apply. This rule was formulated in Pinnel’s Case that “payment of a lesser sum on the day in satisfaction of a greater, cannot be any satisfaction for the whole, because it appears to the Judges that by no possibility, a lesser sum can be a satisfaction to the plaintiff for a greater sum: but the gift of a horse, hawk, or robe, etc. in satisfaction is good ... [as] more beneficial to the plaintiff than the money.”
The rule in Pinnel’s Case is later reinforced in the case of Foakes v Beer where The appellant, Foakes, owed the respondent, Beer, a sum of £2,090. Beer agreed that she would not take any action against Foakes for the amount owed if he would sign an agreement promising to pay an initial sum of £500 and pay £150 twice yearly until the whole amount was paid back. Foakes was in financial difficulty, and so Beer did not include any interest on the amount owed. Foakes made the payments as agreed without any interest but later Beer sues Foakes for the interest. In this case the Court of Appeal found in favour of Beer and Foakes was required to pay the interest on the money owed. The reasoning behind their judgement was that even though the agreement did not include the interest owed, it could still be implied given an enforceable agreement. However, the promise to pay a debt was deemed not to be sufficient consideration as there was no additional benefit moving from Foakes to Beer that was not already owed to her. In this way promissory estoppel could not be applied and thus could not be used as a sheild and these two cases demonstrate that the shield is not always available in English law.
In conclusion to the question of what is meant by the maxim “promissory estoppel may be used as a shield but not a sword” I believe that it is a metaphore which, when inturpreted, describes the way in which the legal system has great, but limited, powers. With these powers they can protect citizens from other parties going back on an assumption or promise when it would be unjust, yet within their strict legal rights, to do so as shown in the Central London Property Trust v High Trees House case. However as these powers are limited and it is not within the doctrine promissory estoppel to provide the promisee with a sword, such as the right to sue, to use as a weapon against promisor, as has been demonstarted through the case of Combe v Combe. The inference of the satatement that “promissory estoppel may be used a shield but not a sword,” is that promissory estoppel serves as protection but does not create any new causes of action for the promisee which were not previously in existance.
Further, to conclude on the second question, of to what extent the statement “promissory estoppel may be used as a shield but not a sword” is true in English law I believe, from the evidence provided from the cases brought in the English courts, that this statement is, to a great extent, true of English Law. By looking at the cases of Central London Property Trust v High Trees House Ltd and Combe v Combe we can clearly see how this metaphor is translated into action, as the court will do “what is necessary, but not more, to prevent a person who has relied on such a promise… from suffering detriment.”
Lord Denning LJ, Moorgate Mercantile v Twitchings [1976] 1 QB 225
Birkett LJ, Combe v Combe [1951] 2 K.B. 215
Combe v Combe [1951] 2 K.B. 215
Oxford English Dictionary, second edition 1989
Oxford English Dictionary, second edition 1989
Central London Property Trust v High Trees House Ltd [1947] K.B. 130
Hughes v Metropolitan Railway Co (1876-77) L.R. 2 App. Cas. 439
Birmingham & District Land Co v London & North Western Railway Co [1887] L.R. 34 Ch. D. 261
Combe v Combe [1951] 2 K.B. 215
Central London Property Trust v High Trees House Ltd [1947] K.B. 130
Lord Denning LJ, Combe v Combe [1951] 2 KB 215
Combe v Combe [1951] 2 K.B. 215
Lord Denning LJ, Combe v Combe [1951] 2 K.B. 215
Lord Denning LJ, Combe v Combe [1951] 2 K.B. 215
Tool Metal Manufacturing Co. Ltd. v Tungsten Electric Co. Ltd. [1995] 1 W.L.R. 7611 W.L.R. 761
“The offensive limits of promissory estoppel” Roger Halson, 1999
“The offensive limits of promissory estoppel” Roger Halson, 1999, p1.
Crabb v Arun D.C. [1976] Ch. 179, p.198.
Pinnel's Case [1602] 5 Co Rep 117a
Pinnel's Case [1602] 5 Co Rep 117a
Foakes v. Beer [1884] 9 App Cas 605.
Central London Property Trust v High Trees House Ltd [1947] K.B. 130
Combe v Combe [1951] 2 K.B. 215
Crabb v Arun D.C. [1976] Ch.179, p.189