What is Promissory Estoppel?
The estoppel of promise is the legal principle according to which a promise is enforceable by law, even if it is made without formal consideration when a promising person has made a promise to a promised one which then relies on this promise to its later detriment . The purpose of estoppel promissoire is to prevent the promisor from claiming that an underlying promise must not be legally maintained or executed. The doctrine of preclusion is part of the law in the United States and other countries, although the precise legal requirements of preclusion vary not only between countries but also between different jurisdictions, such as states, within the same country.
Key points to remember
- Estoppel is a legal principle that prevents people and businesses from going back on their word or their promise.
- Promisory estoppel assists injured parties to recover from promises that have resulted in economic loss when they have not been kept.
Understanding the promising estoppel
The promising estoppel allows an injured party to recover from a promise. There are common elements legally required for a person to be able to request a promisory estoppel: a promisor, a promise and an injury that the promise has suffered. An additional requirement is that the person making the claim – the promised one – must have reasonably invoked the promise. In other words, the promise was one that a reasonable person would normally rely on.
Another requirement further qualifies the injurious component required; the person promised must have suffered real substantial damage in the form of an economic loss resulting from the fact that the person promising has not kept his promise. Finally, promissory estoppel is generally granted only if a court determines that the execution of the promise is essentially the only means by which injustice to the promise can be rectified.
Example of a successful estoppel
An example of a statutory estoppel could be applied in the event that an employer makes an oral promise to an employee to pay him a specified amount of monthly or annual money throughout his retirement. If the employee subsequently retires on the basis of the employer’s promise, the employer may be legally prevented from not keeping his promise to make the specified retirement payments.
Estoppel promissory in the context of contract law
Contract law generally requires that a person be taken into account when making a promise or agreement. Legal consideration is a valuable asset that is exchanged between two parties to a contract at the time of a promise or agreement. Usually, some form of consideration, either an exchange of money or a promise to refrain from any action, is required for a contract to be legally enforceable. However, in attempting to ensure justice or fairness, a court may enforce a promise even in the absence of any consideration, provided that the promise is reasonably invoked and that the use of the promise has caused prejudice to promised.