contract law Cases

The case summary below is supplied by Law Teacher as a free information resource to help you with your studies.

Alan & Co Ltd v El Nasr Export & Import Co [1972] 2 WLR 800

SALE OF GOODS – LETTER OF INTENT – LETTER OF CREDIT – PROMISSORY ESTOPPEL

Facts

This case concerns the sale of coffee beans between a Kenyan coffee business (A) and a Tanzanian based buyer (El Nasr), who then resold the product. The contracts (two) between the two parties were made for 250 tonnes of coffee beans, sold at 262 Kenyan shillings per cwt. The amounts were made payable on credit, the agreement of which was set up using amounts in sterling. This is the key discrepancy between the contract for sale and the credit agreement – however the other discrepancies were addressed prior to any exchange. The first shipment was accepted by El Nasr, who paid for this instalment in pounds sterling. When payment became due on the second instalment, the value of sterling had decreased. To avoid a loss A demanded payment in Kenyan Shillings, meaning that the sterling balance needed increasing/the balance was owing.

Issue

Could the buyers rely on promissory estoppel, based on the original acceptance of the first payment in sterling and the lack of redress about the inclusion of sterling during the addressing of other issues?

Held

  1. A requirement of promissory estoppel is that the promisee‘s conduct has been influenced by the promise or representation.
  2. To rely on promissory estoppel, detrimental reliance is not a key requirement. You must only establish that the promisor has changed their position.