Estoppel

In Rock Advertising Ltd v MWB Business Exchange Centres Ltd, the Supreme Court used estoppel as the safety valve for a wider problem: what happens when a written contract requires all variations to be in writing, but the parties nonetheless act on an informal, oral variation? The Court's press summary explains that 'The safeguard against injustice lies in the various doctrines of estoppel', rather than in simply ignoring the no-oral-modification clause.

That safeguard is not automatic, however. The same summary sets out what a party actually has to show: 'Reliance on an estoppel would require, at the very least: (i) some words or conduct unequivocally representing that the variation was valid notwithstanding its informality and (ii) for this purpose, something more than the informal promise itself.' In other words, simply acting on an agreed but informal variation is not, by itself, enough to found an estoppel — there has to be some additional representation or conduct beyond the variation itself.