(ii) The Conditions for Establishing an Estoppel
Three conditions need to be satisfied before the defendant could be estopped from denying that he or she had been enriched.
- (1) The defendant must have represented to the claimant that he or she wanted to receive the benefit and would pay the claimant for it. Evidence of a request will typically satisfy this condition. But passive acquiescence in the provision of the service should also be sufficient.
- (2) The claimant must have acted to his or her detriment in reliance upon the defendant’s representation that he or she would pay for the benefit.
- (3) The defendant must have falsified the representation in some way. This establishes that the defendant was to blame and provides the justification for preventing the defendant from denying that he or she was enriched.[1] The defendant should not be estopped from denying the enrichment if the representation is falsified without blame on the part of the defendant. So where, for example, the defendant encourages the claimant to incur expenditure in anticipation of a contract and no contract is made simply because the parties are unable to agree, the defendant is not at fault and so should not be estopped from denying that he or she had been enriched.[2]
- [1] The requirement of fault has been stressed in a number of cases. See, in particular, Brewer StreetInvestments Ltd v Barclays Woollen Co Ltd [1954] 1 QB 428 and Sabemo Pty Ltd v North Sydney MunicipalCouncil [1977] 2 NSWLR 880.
- [2] Sabemo Pty Ltd v North Sydney Municipal Council [1977] 2 NSWLR 880, 880 and 901 (Sheppard J).See also 903.
