Baird Textile Holdings Ltd v Marks & Spencer [2001]
Court: Court of Appeal
Facts: Baird Textile Holdings Ltd (Baird Textile) had been supplying garments to Marks & Spencer (M&S) for 30 years without a formal written agreement. M&S notified Baird Textile that they would stop purchasing garments after the end of the current season. Baird Textile sued M&S on two grounds: (1) for breach of an implied contract requiring a longer notice period and (2) arguing that M&S was estopped from ending the relationship abruptly, citing the case of Walton Stores v Maher [1988].
Issue: Whether promissory estoppel could prevent M&S from terminating the long-standing commercial relationship abruptly and whether there was an implied contract requiring a longer notice period.
Held: The Court of Appeal rejected both claims. The court ruled that:
Promissory Estoppel: It is not a standalone cause of action. Promissory estoppel can only support an existing cause of action, rather than create one. It requires a pre-existing contractual relationship and cannot be used to enforce a claim where none exists, as established in Amalgamated Investments & Property Co Ltd v Texas Commerce International Bank Ltd.
Implied Contract: The court did not find evidence of an implied contract requiring a longer notice period.
Key Judicial Statements: Mance LJ: Emphasized that different types of estoppel (e.g., promissory and proprietary) must be kept distinct. Promissory estoppel cannot stand alone as a cause of action but can support a claim where there is an existing contractual relationship. Mance LJ noted that the doctrine of estoppel must adhere to established legal principles and precedents, and cannot extend beyond its traditional scope without explicit support from case law.
💡 Leveluplaw: Baird Textile Holdings Ltd v Marks & Spencer highlights that promissory estoppel cannot be used as a standalone cause of action but may support a claim within the context of an existing contract. It underscores the need for a clear contractual relationship and adherence to established principles regarding different types of estoppel.