• In the case of Central London Property Trust Ltd v High Trees House Ltd [1947] KB 130, the agreement with the intention to create legal creations is influenced by the circumstances of the Second World War.
  • This contract case established the principle of promissory estoppel meaning that genuine promises without consideration are legally enforceable.
  • This case was about leases and equitable principles.

Facts of the Case

  • C and D contracted for a lease of a block of flats.
  • The Second World War began making it difficult for D to search for tenants. C consented to halving the rent until the war ended.
  • C contended in this case that the original contract stands because there was no consideration.

Issues

  • Does part payment count as consideration for a promise made?
  • Could C recover for the loss during the war?

Held by High Court

  • C wins the claim – C cannot claim back money owed during the war because they agreed to the change in rent but now D owes the money based on the initial contracting terms.

Denning J

Promissory estoppel

  • C and D’s binding promise intended to last the duration of the war. D successfully upheld his end of the bargain.
  • Based on equity and the surrounding circumstances, C was bound by their promise. The judge relied on the principle of equitable waiver from Hughes v Metropolitan Railway [1877] 2 AC 439.
  • “A promise intended to be binding, intended to be acted upon, and in fact acted on, is binding so far as its terms properly apply. Here it was binding as covering the period down to the early part of 1945, and as from that time full rent is payable.”

Editor’s Notes

  • This case raises the question of whether common law procedures can be fused with equity.

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