Robbins v King Contract MootWatch
We represent Mr Robbins so we are the appellant and we need to find some points against Mr King to support Mr Robbins.
Ok, let's startRobbins v King
Lancelot Zute owned a large piece of land in Derbyshire known as the Montgomery estate. Mr Zute had been a life-long member of the Communist Party and had always had a deep interest in environmental issues and Celtic mythology. In 1976 he had founded the Grail Community, a religious organisation devoted to rediscovering the ancient truths of the Celtic druids. One of the core beliefs of the Community was that the concept of private property was alien to nature. Mr Zute had one surviving relative, a merchant banker called Hector Robbins. As Mr Zute approached his 83rd birthday, Mr Robbins became increasingly hopeful of inheriting the Montgomery estate within the next few years.
Denis King had been at university with Mr Robbins but his subsequent career had been fairly disastrous. By 1997, his business was failing and his marriage was breaking up. Having met up again at a reunion dinner, Mr Robbins agreed to loan Mr King £37,000, to be paid back at a rate of interest over the next three years. The loan cleared Mr King’s other debts but he was forced to work long hours to generate enough income to make the interest payments on the loan.
In March 1998, Mr Zute was diagnosed as suffering from a disease which meant that he was not likely to live more than another three months or so. When Mr Robbins came to visit him, Mr Zute brought up the subject of his will. He said that there was a clause in his will to the effect that Mr Robbins was to inherit the Montgomery estate but only on condition that, on the death of Mr Zute, Mr Robbins had personal assets of less than £150,000, excluding his home. Mr Robbins was appalled to hear this and engaged an accountant to make a full audit of his personal assets. The accountant estimated that Mr Robbins had assets in the region of £165,000. The accountant recommended that the best way to reduce his assets to a level that was safely under £150,000 would be to extinguish the debt owed by Mr King. Mr Robbins telephoned Mr King and told him that he would accept £10 in full and final settlement of the remainder of the £37,000 debt. Mr King drove straight round to Mr Robbins’ house and give him a £10 note.
Ten months later, Mr Zute finally died and his will was admitted into probate. It soon became apparent that Mr Zute, who had been well-known for his practical jokes, had lied to Mr Robbins. The will in fact contained no clause giving the Montgomery estate to Mr Robbins, whatever his personal assets. Instead, the entire Montgomery estate had been left to the Grail Community. In light of this, Mr Robbins decided to reactivate the loan agreement with Mr King. However, he soon discovered that Mr King had sold his business and all his personal assets and donated the proceeds to the Grail Community. Traumatised by the whole experience of being in debt, Mr King had felt reborn when excused the debt to Mr Robbins and had associated his rebirth with the influence of the Grail Community. He had renounced material wealth and had vowed to spend the rest of his life living off the land on the Montgomery estate.
Mr Robbins brought an action against Mr King claiming £33,256.86, being the amount still owing under the original £37,000 loan agreement.
At first instance, Mann J followed the decision in Re Selectmove  2 All ER 531 and held that he was bound by the ratio of Foakes v Beer (1884) 9 App Cas 605. The payment of £10 could not in law be a satisfaction of the debt of £33,256.86, there being no consideration for the agreement to waive the remainder of the debt. Mr King had argued that an estoppel had been raised by Mr Robbins’ waiver and acceptance of the £10. However, Mann J had held that the principle of promissory estoppel could not operate so as to extinguish a contractual obligation, but merely so as to suspend it. Accordingly, so long as Mr Robbins was prepared (as indeed he was) to give Mr King a reasonable time before the resumption of repayments, the original loan contract was still binding on Mr King.
The Court of Appeal allowed Mr King’s appeal, primarily on the basis of the principle identified in Williams v Roffey  1 All ER 512. Mr Robbins had received (or at least had hoped to receive) a practical benefit from extinguishing the debt with Mr King. Both Foakes v Beer and Re Selectmove could be distinguished from the present case and the remarks made in Re Selectmove to the effect that the approach in Williams should only apply to contracts to do work were clearly obiter. In the alternative, the Court of Appeal held that an estoppel had been raised by Mr Robbins’ acceptance of the £10 in full and final settlement of the debt and by Mr King’s subsequent decision to donate his assets to the Grail Community. Moreover, since Mr King had now forever renounced material wealth, it was no longer possible for him to resume making payments. Following the decision of the Privy Council in Ajayi v Briscoe  3 All ER 556, the overall effect of the estoppel in these circumstances was to extinguish the debt.
Mr Robbins now appeals to the Supreme Court on the following two grounds:
1) The Court of Appeal erred in holding that the facts in the present case can be distinguished from Foakes v Beer. The notional benefit derived by Mr King was speculative in nature and could not amount to consideration so as to extinguish the unpaid debt. While superficially controversial, the effect of the decision of the House of Lords in Foakes v Beer was to draw a clear line in support of the principle of contractual consideration. If a business creditor wants to accept a lesser sum in full and final settlement, there are ways of achieving this, not least that identified in Pinnel’s Case; namely the passing of some symbolic token such as a “horse, hawk or robe”. Furthermore, the Court of Appeal in Williams v Roffey were wrong to hold that a vague, coincidental “practical benefit” can amount to consideration for the variation of the terms of a contract. The Supreme Court will be invited to overrule Williams and to reaffirm the importance of contractual consideration.
2) The Court of Appeal also erred in holding that Mr Robbins’s debt had been extinguished by the operation of promissory estoppel. As with ground 1) above, estoppel has been used by the courts in recent years so as to undermine the principle of consideration. For a promise purporting to vary the terms of a contract to be binding, consideration must pass from the promisee; in the present case, it must pass from Mr King. The fact that Mr King made some eccentric lifestyle choices following a conversation with my Robbins cannot and should not affect his existing contractual liability. It should certainly not extinguish it. In any event, the courts have been uncertain how to apply the doctrine of promissory estoppel, attempting to hide behind loose notions such as it being “a shield not a sword” and it only suspending not extinguishing contractual rights. The doctrine has always been unsatisfactory and based on weak authority. The Supreme Court will be invited to restore this areas of law to its former clarity by overruling the line of authority going back to the Hightrees case.
That's it. We are the appellant (Mr Robbins).