| TABLE OF CONTENTS:- 1. Estoppel – introduction 2. Doctrine of election – Doctrine of “approbate and reprobate” 4. Promissory Estoppel 5. Estoppel and Waiver |
“Estoppel” is a rule of equity. “That rule has gained new dimensions in recent years. A new class of estoppel i.e. promissory estoppel has come to be recognised by the courts in this Country as well as in England.” – Turner Morrison And Co., Ltd vs Hungerford Investment Trust Ltd,1972 SCR (3) 711
Estoppel – Introduction:- Under English Law, the modern doctrine of promissory estoppel is based on the principle of equity and it binds the Crown,88 as well as a public authority, as was pointed out in Robertson v. Minister of Pensions, (1949) 1 K.B. 227. Today, Indian judges have felt that there is no any compulsion to follow the American authorities. See. Basheshar Nath v. Commissioner of Income-tax, AIR 1959 SC 149. The doctrine of promissory estoppel has been widely used in the United States in diverse other situations as founding a cause of action. The most notable instances are to be found in what may be called the “sub-contractor bid cases” in which a contractor about to tender for a contract, invites a sub- contractor to submit a bid for a sub-contract and after receiving his bid the contractor submits a tender. In such cases, the sub-contractor has been held unable to retract his bid and be liable in damages if he does so. It is not possible to say that any detriment which the contractor may be able to show in these cases would amount to consideration in its strict sense and these decisions have plainly been reached on an application of the doctrine of promissory estoppel. One of such cases was Drennan v. Star Paving Company(1) where Traynor, J. explicitly adopted as good law the text of Article 90 of the Restatement of the law of Contracts quoted above and stated in so many words that “the absence of consideration is not fatal to the enforcement of such a promise”. There are also numerous cases where the doctrine of promissory estoppel has been applied against the Government where the interest of justice, morality and common fairness clearly dictated such a course.
A conclusive admission, which cannot be denied. It is of three kinds: —
(1) By matter of record, which imports such absolute and incontrovertible verity, that no person against whom it is producible shall be permitted to aver against it. A record concludes the parties thereto and their privies, whether in blood, in law or by estate, upon the point adjudged, but not upon any matter collateral or adjudged by inference. — A judgment in an action in rem is absolutely upon all the world. A conviction on the same facts is no estoppel in a civil action because the parties are not the same. — Palace Shipping Co. Ltd. v. Caine, 1907 AC 386.
(2) By deed. No person can be allowed to dispute his own solemn deed, which is therefore conclusive against him and those claiming under him, even as to the facts recited in it. The general rule is that an indenture estops all who are parties to it, while a deed-poll only estops the party who exccutes it, since it is his sole language and act.
(3) In pais i.e. by conduct or representation, as that a tenant cannot dispute his landlords title; bringing an action of ejectment is an unequivocal act, Serjeant v. Nash, Field & Co., (1903) 2 KB 304.
Doctrine of election – Doctrine of “approbate and reprobate”:- The Apex Court in Sri Babu Ram Alias Durga Prasad vs. Sri Indra Pal Singh (Dead) by Lrs., AIR 1998 SC 3021, and P.R. Deshpande vs. Maruti Balram Haibatti, AIR 1998 SC 2979, the Supreme Court has observed that the doctrine of election is based on the rule of estoppel- the principle that one cannot approbate and reprobate inheres in it. The doctrine of estoppel by election is one of the species of estoppel in pais (or equitable estoppel), which is a rule in equity. By that law, a person may be precluded by his actions or conduct or silence when it is his duty to speak, from asserting a right which he otherwise would have had.
It is evident that the doctrine of election is based on the rule of estoppel the principle that one cannot approbate and reprobate is inherent in it. The doctrine of estoppel by election is one among the species of estoppel in pais (or equitable estoppel), which is a rule of equity. By this law, a person may be precluded, by way of his actions, or conduct, or silence when it is his duty to speak, from asserting a right which he would have otherwise had.
The doctrine of “approbate and reprobate” is only a species of estoppel, it implies only to the conduct of parties. As in the case of estoppel it cannot operate against the provisions of a statute. (vide C.I.T vs. Mr. P.Frim Maur, AIR 1965 SC 1216).
It is settled proposition of law that once an order has been passed, it is complied with, accepted by the other party and derived the benefit out of it, he cannot challenge it on any ground. (Vide Maharashtra State Road Transport Corporation vs. Balwant Regular Motor Service, Amravati & Ors., AIR 1969 SC 329). In R.N. Gosain vs. Yashpal Dhir, AIR 1993 SC 352, this Court has observed as under:– “Law does not permit a person to both approbate and reprobate. This principle is based on the doctrine of election which postulates that no party can accept and reject the same instrument and that “a person cannot say at one time that a transaction is valid and thereby obtain some advantage, to which he could only be entitled on the footing that it is valid, and then turn round and say it is void for the purpose of securing some other advantage.” See. State of Punjab v. Dhanjit Singh Sandhu, (2014) 15 SCC 144. The Supreme Court in The Rajasthan State Industrial Development and Investment Corporation and Anr. vs. Diamond and Gem Development Corporation Ltd. and Anr., AIR 2013 SC 1241, made an observation that a party cannot be permitted to “blow hot and cold”, “fast and loose” or “approbate and reprobate”. Where one knowingly accepts the benefits of a contract or conveyance or an order, is estopped to deny the validity or binding effect on him of such contract or conveyance or order. This rule is applied to do equity, however, it must not be applied in a manner as to violate the principles of right and good conscience.
Promissory Estoppel — “Estoppel” is a rule of equity. The doctrine of promissory estoppel has assumed importance in recent years, though it was dimly noticed in some of the earlier decisions. Where parties enter into an agreement which is intended to create legal relations between them and in pursuance of such arrangement one party makes a promise to the other which he knows will be acted on by the promisee, the court will treat the promise as binding on the promisor to the extent that it will not allow him to act inconsistently with it even though the promise may not be supported by consideration in the strict sense. But the principle does not create any cause of action which did not exist before so that, where a promise is made which is not supported by any consideration, the promisee cannot bring an action on the basis of that promise, Turner Morrison & Co. Ltd. v. Hungerford Investment Trust Ltd., (1972 1 SCC 857.
In Hughes v. Metropolitan Railway Co. (supra) the plaintiff and the defendant were already bound in contract and the general principle stated by Lord Cairns, L.C. was:
“If parties who have entered into definite and distinct terms involving certain legal results afterwards-enter upon a course of negotiations”.
Ten years later Bowen, L. J. also used the same terminology in Birmingham and District Land Co. v. London and North Western Rail Co. (supra) that:
“If persons who have contractual rights against others induce by their conduct those against whom they have such rights to believe—–“.
These two decisions might, therefore, seem to suggest that the doctrine of promissory estoppel is limited in its operation to cases where the parties are already contractually bound and one of the parties induces the other to believe that the strict rights under the contract would not be enforced. In Motilal Padampat Sugar Mills Co. Ltd. v. …, (1979) 2 SCC 409, the Suprme Court points out as follows: ‘But we do not think any such limitation can justifiably be introduced to curtail the width and amplitude of this doctrine. We fail to see why it should be necessary to the applicability of this doctrine that there should be some contractual relationship between the parties.’
Estoppel and Waiver — Waiver means abandonment of a right and it may be either express or implied from conduct, but its basic requirement is that it must be “an intentional act with knowledge”. The Principle is that ‘What cannot be done directly cannot be done indirectly.’ See. Cummings v. Missouri, 18 L Ed 356 at page 363. Estopeela and Waiver are, in fact, closely akin., and that their legal consequences too are appears to be similar. But, ”Waiver” is distinct from estoppel in that in waiver the essential element is actual intent to abandon or surrender right, while in estoppel such intent is immaterial, Provash Chandra Dalui v. Biswanath Banerjee, 1989 Supp. (1) SCC 487.
As was held by Supreme Court in Olga Tellis v. Bombay Municipal Corpn.,(1985) 3 SCC 545, in Para 28, there can be no estoppel against the Constitution. The Constitution is not only the paramount law of the land but, it is the source and sustenance of all laws. Its provisions are conceived in public interest and are intended to serve a public purpose. … This principle [estoppel] can have no application to representations made regarding the assertion or enforcement of fundamental rights.