Promissory estoppel; proof of detrimental reliance on a non-contractual promise; the nature of relief for promissory estoppel.
Facts: Prithvi Sidhu (PS) and his wife owned a 32 hectare property on which they lived. Lauren Van Dyke (LVD) was married to Mrs Sidhu's brother. She and her husband lived as tenants in a cottage built on the Sidhu's property. PS and LVD fell in love and began a sexual relationship. PS promised LVD that, because he loved her, he would look after her by subdividing the property he owned with his wife and giving LVD the cottage she lived in. Later, when the LVD's marriage ended in divorce, PS repeated this promise. PS also advised LVD that, on the basis of this promise, she should not seek a property settlement from her husband.
LVD followed this advice. She continued to live as a tenant in the cottage, making substantial improvements to it in the belief that it would eventually become hers. However, despite further assurances from PS over the years that his promise would be kept, PS eventually refused to subdivide the land and transfer the cottage to LVD. PS's promises were not formally executed contracts and LVD gave no consideration in support of an informal contract. She sued to enforce the promises PS had made on the basis of promissory estoppel.
Issue: Was it proved that LVD had, to a sufficient extent, relied on the promises made by PS and, as a result, acted to her detriment? If so, what relief was appropriate?
Decision: On appeal the court held that LVD had established a promissory estoppel and that PS should not be allowed to depart from his promises. In the circumstances, LVD was entitled to substantial fulfilment of the promises.
Reason: The onus was on LVD to prove that she had been induced to rely on PS's promises and as a result acted to her detriment. LVD had discharged this onus because it was likely, on the probabilities of human behaviour, that PS's promises influenced her to stay on as a tenant, to improve the cottage, and to give up seeking a property settlement from her former husband at the time of her divorce. Even if other factors had played a part in LVD's decisions, it was sufficient that PS's promises had influenced her calculations to the extent that it would be unconscionable for PS to depart from his promises. The normal remedy for a breach of contract is the value of the promise (unless good conscience requires otherwise). LVD was therefore entitled to be paid compensation by PS to the value of the cottage at the date of judgement.