Collier v P & MJ Wright [2007]
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Collier v P & MJ Wright (Holdings) Ltd [2007] EWCA Civ 1329 is an English contract law case that addresses the doctrines of consideration and promissory estoppel, specifically in the context of alteration promises.
Mr Collier, one of three partners of a property development company, agreed to pay £46,000 to Wright Ltd in monthly instalments of £600 based on a court order. Payments were reduced to £200 a month, and in 2000, Mr Collier claimed that there was a meeting where Wright Ltd assured him that he would be severally liable for £15,600 rather than jointly liable as a partner. The other two partners went bankrupt, and in 2006, after Mr Collier had made his payments totalling one third of the debt, Wright Ltd demanded the balance. Mr Collier argued that a variation agreement was binding or, if not, Wright Ltd was estopped from enforcing the full payment.
The Court of Appeal reversed the judgment at first instance on the promissory estoppel point. Arden LJ held that while Foakes v Beer [1884] applied, promissory estoppel could aid Mr Collier. He had relied on the assurance and for Wright Ltd to resile from the promise would be inequitable. Longmore LJ was more cautious, emphasising the need for meaningful reliance and true accord. Mummery LJ agreed, stating there was a prospect of real success on the estoppel argument.
The case is significant in its application of promissory estoppel in situations involving alteration promises. It highlights the tension between Pinnel's Case [1602] / Foakes v Beer [1884] doctrine and promissory estoppel, with some suggesting it leaves doors open to sidestep Foakes v Beer via promissory estoppel. The case is seen by some as challenging established principles and possibly reversing Foakes v Beer. However, there are differing opinions on its significance, with some critics expressing reservations about the erosion of equitable principles.
In summary, Collier v P & MJ Wright (Holdings) Ltd is an important case that delves into the complex interplay between traditional contract law doctrines and the evolving principles of promissory estoppel, particularly in the context of alteration promises.
