Estoppel Without Regard to Equity? The Puzzling Omission of Promissory Estoppel’s Inequity Condition in Canada

Promissory estoppel plays an important role in enabling the enforcement of promises not made for consideration in cases where the promise was intended to and did induce a party to change its position in regard to preexisting legal rights. However, Canadian law on estoppel has been plagued by confusion and misunderstanding. This article addresses the internationally notable absence of an inequity requirement from promissory estoppel in Canada. The requirement’s absence is peculiar, in that estoppel’s very foundation is in equity, and it must assure that its effect is indeed equitable. Drawing on the Supreme Court of Canada’s decision in Trial Lawyers Association of British Columbia v Royal & Sun Alliance Insurance Company of Canada, I show how Canadian law is flawed in the absence of this vital element. I further demonstrate that, in fact, Canada was once a leader on this point before the widely-known opinion about it by Lord Denning in England in 1966. Later, the requirement fell through the cracks as the Supreme Court of Canada lost its grasp on its own precedents, and on the law on estoppel more generally. However, drawing on the older jurisprudence, and scholarship here and abroad, the situation can be rectified by having Canadian law again recognize promissory estoppel’s crucial inequity requirement.