How Promissory Estoppel Operates in Contract Law.

The phrase promissory estoppel originates from the idea of "stopping" a party from backing out of a "promise."

To understand how promissory estoppel operates in contract law it is first important to define the term itself.

Promissory estoppel is –

A doctrine in which a non contractual promise may be made enforceable to avoid an injustice.

Generally, a promise is not enforced by the courts if it is not a contract created by mutual assent. However, the court will enforce a promise when the court deems that fairness and equity require that enforcement.
An example is the construction of a building. A construction company puts together the estimates of a number of subcontractors and quotes its client a price. The client accepts, and construction begins. However, thereafter one of the subcontractors drastically raises the price above its original estimate. Because of this change, the construction company cannot profit from the building. A court would be likely to give the co...