Perhaps the best way to explain estoppel is to give an example.
In this case Sue cannot argue that any contract has been breached, because no contract has been entered into.
However the doctrine of estoppel will ‘stop’ Bill from contending that the contract should not be enforced.
The Court will hold Bill to the terms of the contract, even though it was not entered into.
In this example, for estoppel to apply the following requirements must be satisfied:
The purpose of estoppel is to prevent detriment by compelling a party to adhere to an assumption or expectation which he has encouraged the other party to adopt.
In this case estoppel will prevent detriment to Sue by compelling Bill to adhere to an assumption or expectation which he has encouraged Sue to adopt, namely that Bill would enter into a contract on particular terms.
Estoppel often operates to prevent a party from relying on its strict legal rights, particularly in relation to representations concerning contractual and property rights and interests.
Please contact me if you require legal advice on whether an estoppel may apply to your case.