Problems with promissory estoppel: it was argued that it only applies to pre-exisitng contracts; does it not emasculate the whole idea of consideration (all you need to do instead is rely on it to your detriment). However, Mason CJ and Wilson J note:
[S]o far the doctrine has been mainly confined to precluding departure from a representaiton by a person in a pre-existing contractual relationship that he will not enforce his contractual rights, whether they be pre-existing or rights to be acquired as a result of the rerepsentaiton….In principle, there is certainly no reason why the doctrine should not apply so as to preclude departure by a person from a representaton that he will not enforce a non-contractual right.

Despite the slight divergence in opinion in the HC, the better statement of principle appears to be that applied by Mason CJ and Wilson J, that equity will come to the relief of a plaintiff who has acted to his or her detriment on the basis of a basic assumption in relation to which the other party to the transaction has played such a part in the adoption of the assumption that it would be unconscionable of that other party to ignore the assumption. In that sense, equitable estoppel is based on the relief against unconscionable conduct, rather than the making good of representations.

Elements of Waltons estoppel:
These are drawn from Waltons.
-    Assumption or representation: Plaintiff adopts an assumption that a certain state of affairs exists or will be brought into existence. Usually an issue of fact, law or legal right. The representation can be inferred from conduct. Needs to be clear and unambiguous
-    Encouragement or acquiescence: Defendant can be shown to have contributed to or caused the adoption of the assumption by the plaintiff. Usually as a result of some representation;
-    Reliance: Plaintiff acts or refrain from acting in reliance on the assumption in such a way that he or she will suffer detriment if the assumption is denied. The action or inaction, the change of position in reliance of the assumption, must also be of some significance

Fitzwood Pty Ltd v Unique Goal Pty Ltd (in liq) [2001]
Held: The equity principle will have no application when the transaction remains wholly executory on the plaintiff’s part. If the facts give rise to an estoppel, the relief that a court will grant should not ‘exceed what could be justified by the requirements of good conscience’ particularly where it would be unjust to the estopped party’  equity permits the court to do what is necessary but no more. The representee must demonstrate a link between the promise or representation made and the conduct said to be in reliance on that promise, it need not be the sole inducement for the actions of the representee provided it acts as an inducement. This cannot be the case if it is shown that the representee would have acted in the same way whether the representation was made or not.

-    Detriment: Plaintiff will suffer detriment if the assumption is not made good or if the Defendant insists on his strict legal rights that are inconsistent with the assumption, the representee must show that it is unconscionable for the party making the representation to resile from it in the circumstances. Jurisdiction in equity is based on the need to relieve against the detriment which would otherwise be suffered by the plaintiff, rather than the making good of the representation or expectation.
One view of detriment is the relevant detriment is confined to the detriment flowing from the reliance on the assumption. The other view is that the relevant detriment is detriment occasioned by reliance on a promise that is not fulfilled.

-    Unconscionability: It must be unconscionable for the Defendant to insist on his strict rights and deny the assumption as seen in Austotel Pty Ltd v Franklins Selfserve Pty Ltd  a property developer and a supermarket proprietor negotiated for lease of new premises, exchanging letters of intent expressed to be subject to a formal agreement for a lease. Subsequently, the size of the store was increased but no agreement was reached on the rent to be charged for the larger premises. The supermarket proprietor nevertheless acquired fittings and equipment and the property developer proceeded with construction and adaption of the store premises.

o    By a majority the crt held that the parties were commercial entities which had deliberately refrained from coming to an agreement as to rental, and in those circusmtances, no equity had arisen from the developer who subsequently declined to enter a lease. Having taken the deliberate ‘gamble’, Franklins could not expect equity to put it in the position it would have held had it not gambled.
o    Priestly JA analysed Waltons and earlier cases, and concluded that for equitable estoppel to operate in pre-contractual negotiations [T]here must be the creation or encourgament by the defendant in the plaintiff of an assumption that a contract will come into existence or a promise be performed or an interest granted the plaintiff by a defendant, and relianc eon that by the plaintiff in circustmances where departure from the assumption by the defendant would be unconscionable. - Per Priestly JA

In
this case, they took the view of commercial reality, you have to be free to change your mind, you have to be able to back out of a contract.
This appears to be the dividing line: there was encouragment in Waltons, however, in this case, there was no encouragment.
 
The point of unconscionability requires something more. It requires that there be something wrong in the circumstances themselves. Waltons knew for some time they were not going to take up the lease and knew also the Mahers were demolishing the buildings and going ahead with construction. They let some months go by before saying they were not proceeding with the lease.

Commonwealth v Verwayen affirmed the doctrine of equitable estoppel identified in Waltons.
Facts: Verwayen was a member of the crew of HMAS Voyager when that ship was sunk in a collision with HMAS Melbourne during naval exercises.

In 1984, he commenced proceedings against the Commonwealth seeking damages for injuries sustained in the collision, which he alledged had been caused by the negligence of the officers and crew of one or both ships.
At the time proceedings were commenced, and for some considerable time thereafter, the Commonwealth stated that it would not rely on any defences based on the Statute of Limitations, or on the ground that the Voyager was engaged in a combat situation at the time of the collision, so that the only issues to be tried would be whether the injuries sustained by the plaintiff had resulted from the sinking of the Voyager and the appropriate measure of damages. In 1985 that policy was changed and in 1986 the Commonwealth sought and obtained leave to amend its defence to contest liability, on the basis that it did not owe a duty of care in the circumstances, and that the claim was statute-barred. The respondent delivered a reply which asserted, among other things, that the Commonwealth was estopped from relying on either defence.

Held: The Commonwealth could not change its position and that it could not introduce either defence. Majority thought that it was enough that the Cth promised to pay V’s costs, ie. put him back in the position he would have occupied if he never brought the action.

But, importance is that there are comments in the Mason and Brennan judgements that the different doctrines of estoppel are merging.

[I]n conformity with the fundamental purpose of all estoppels to afford protection against the detriment which would flow form a party’s change of position if the assumption that led to it were deserted, these developments have brought a greater underling unity to the various categories of estoppel. Indeed, the consistent trend in the modern decisions points inexorably twaords the emergence of one overarching doctrine of estoppel rather than a series of independent rules.
-Per Mason CJ

-Deane J (part of majority) argued that promissory estoppel was a species of estoppel by conduct (again, an overarching princple with ‘branches’ as opposed to different doctrines altogether)

This case is subject to the continuation of the debate about the possible unification of equitable and common law estoppel.
The principles of equitable estoppel were discussed and applied by the Full Court of the Federal Court in S & E Promotions Pty Ltd v Tobin Bros Pty Ltd (1994)
Held: as in Waltons that in some cases it might be necessary to show that the defendant had actual knowledge of a belief that the plaintiff had acted in reliance. Where the actions or the imprudence of the Defendant was a ‘proximate cause of the other party’s adopting and acting upon the faith of the assumption’, then the justice of an estoppel would be made out. As far as reliance was concerned, it was stated that it would be sufficient to the representee to establish that reliance caused it to lose a real chance of avoiding the detriment.

The Current state of law:
1.    The object of the estoppel is to prevent an unjust departure by one person from an assumption adopted by another as the basis of some act or omission which, unless the assumption is adhered to, would operate to that other’s detriment.
2.    Equitable estoppel can also arise from representations or assumptions as to future conduct: Waltons.
3.    Equitable estoppel is a source of substantive rights and may be pleaded as a cause of action in its own right.
4.    Equitable estoppel creates an equity in favour of the party who can successfully assert it. The remedy granted will be that necessary to prevent detriment resulting from the unconscionable conduct of the other party, which is described as ‘the minimum equity to do justice to the plaintiff’: Crab v Arun District Court.
5.    The essential feature of the modern doctrine of equitable estoppel is its operation as a principle designed to prevent unconscionable conduct, or the unconscionable insistence on strict rights. It does this by fashioning appropriate remedies to achieve that object.
6.     There is uncertainty with the elements of the cause of action available under the principle of equitable estoppel. Mason CJ and Wilson J in Waltons view estoppel in equity as a doctrine principally intended to prevent unconscionable conduct. However Brennan J in Waltons equitable estoppel arises mainly to prevent the detriment of the plaintiff would otherwise suffer if the assumption or expectation were not made good.

There is concurrent jurisdiction between equitable estoppel and estoppel in pais in the field of representations of fact, there seems little need for unification. HC appears unlikely to revisit the question of unification of common law and equitable estoppel.

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