Commonwealth v Verwayen

[1990] HCA 39

HIGH COURT OF AUSTRALIA

Mason C.J., Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ.

THE COMMONWEALTH v. VERWAYEN

(1990) 170 CLR 394

5 September 1990

Estoppel

Estoppel—Waiver—Action against Commonwealth by serviceman injured in collision between Australian naval vessels engaged in combat exercises—Defence—Failure to plead expiration of limitation period or absence of duty of care—Statements by Commonwealth that it would not rely on either defence—Subsequent amendment of defence to plead both grounds—Whether Commonwealth estopped from relying on defences—Whether defenced waived—Limitation of Actions Act 1958 (Vict.), s. 5(6).

Decisions

MASON C.J. On the night of 10 February 1964 a collision took place between H.M.A.S. Voyager and H.M.A.S. Melbourne upon the high seas in the vicinity of Jervis Bay. The respondent was at the time a member of the Royal Australian Navy serving on board H.M.A.S. Voyager. He is one of a number of people who subsequently brought actions against the Commonwealth for damages for injuries sustained as a result of the collision, alleging that their respective injuries had been caused by the negligence of the officers and crew of one or both of the ships.

2. It is not necessary for present purposes to describe in detail the circumstances surrounding the collision. It is convenient instead to set out the history of the ensuing litigation between the respondent and the Commonwealth. The most significant aspect of that history is that the respondent did not issue a statement of claim until 2 November 1984. The reason for this delay appears to have been that legal opinion after the time of the collision was influenced by certain remarks made by Windeyer J., by way of obiter, in Parker v. The Commonwealth (1965) 112 CLR 295 at pp 301-302, to the effect that, for reasons of public policy, a member of the armed forces could not recover damages for the negligence of another member of the armed forces in the course of duty. Those remarks were disapproved by the Court in Groves v. The Commonwealth (1982) 150 CLR 113 at pp 118-119, 133-134, 136, 137. That decision broadened the ambit of the law of negligence in the context of the activities of members of the armed forces.

3. By its defence, dated 14 March 1985, the Commonwealth admitted the allegations made in the statement of claim, except that it did not admit that the respondent had been injured or had suffered loss or damage as a result of the collision. In this way, liability was admitted but the question of damages remained in issue. The Commonwealth did not plead that the action was barred by the Limitation of Actions Act 1958 (Vict.) ("the Act"). Nor did it plead that it owed no duty of care to the respondent by reason of the decision in Groves. It is conceded by the respondent that the time period specified in the Act in relation to his cause of action had expired before the statement of claim was issued. Whether or not the Commonwealth owed a duty of care to the respondent on the facts of the present case is one of the questions with which this appeal is concerned.

4. The Commonwealth's action in not pleading these two defences was preceded by correspondence between solicitors acting for other persons seeking damages as a result of the collision and representatives of the Commonwealth. The early correspondence concerned a plaintiff named Robert Palmer, whose solicitors had been advised on 21 November 1983 by the Deputy Crown Solicitor that the Commonwealth would not rely on the Act in his case. Indeed, the Commonwealth did not seek to invoke the Act in Mr Palmer's case. Nor, it seems, did the Commonwealth raise the Groves defence in his case.

5. Mr Palmer's solicitors came to act on behalf of many other survivors of the collision, including the respondent. On 6 September 1984 they wrote to the Secretary of the Department of Defence on behalf of the respondent and four other claimants requesting that he "waive the Statute" in their cases. The Australian Government Solicitor (formerly the Crown Solicitor) advised the solicitors on 25 January 1985 that the Commonwealth proposed to admit liability and to waive the Statute of Limitations defence; this advice was later confirmed in writing.

6. After the defence had been filed, the Australian Government Solicitor joined with the respondent's solicitors on several occasions in making applications for an expedited hearing of the damages question on the ground that liability was not in issue. Moreover, in a number of statements by Ministers of the Commonwealth, it was made clear that the Commonwealth had adopted a policy not to contest liability and not to plead the Statute of Limitations. Many of these statements were not addressed directly to the respondent or his solicitors, but on 27 November 1985 the Minister Assisting the Minister for Defence wrote to the respondent in relation to a proposed settlement of all claims, which his solicitors had suggested. The letter stated in part:
"As you have pointed out, the Commonwealth has admitted
negligence and is not pressing the statutory limitation period as a defence. Nevertheless, it still expects claimants to show that they have suffered injury ... and to prove the extent of their injuries and resultant loss, in order to justify an award of damages." In an earlier letter to another Member of Parliament, the Minister had stated that the Commonwealth had "waived the absolute defence open to it" under the Statute of Limitations in relation to the claims of the various plaintiffs.

7. At some time in or around November 1985, the Commonwealth decided to reconsider its policy in relation to the claims arising from the collision. From that point the Commonwealth began to plead defences based upon the Act and upon the argument that no duty was owed to the plaintiffs because of the decisions in Parker and Groves. This action was taken pending a final decision as to the position which the Commonwealth should adopt. Ultimately it was decided that both defences should be raised in each case.

8. Accordingly, the Commonwealth sought and was granted leave to amend its defence to the respondent's claim so as to raise both defences. The Master ordered that the Commonwealth pay the respondent's taxed costs of the application for leave to amend and the costs, if any, rendered abortive by reason of his order. Costs were otherwise reserved for the trial judge. An amended defence was delivered on 29 May 1986. At that time the trial would have been shortly due to commence. The respondent delivered a reply on 5 June 1986 in which he maintained that no defence was disclosed pursuant to the decisions in Parker and Groves and that the Act did not apply to the Commonwealth. In the alternative, he asserted that the Commonwealth had waived any such defences. The respondent also claimed that the Commonwealth was estopped from relying on either defence.

9. On 10 September 1986 in the Supreme Court of Victoria the matter came before Vincent J. who ordered that various issues of fact and law arising out of the pleadings be disposed of before the trial of the action. The respondent successfully appealed against this order and the matter came on for trial before O'Bryan J. on 4 November 1987. His Honour required counsel to argue the questions of law raised by the amended defence and the reply before a jury was empanelled, upon the basis that the relevant facts were not in issue or would not be seriously disputed at the trial.

10. O'Bryan J. held that the public policy defence based on Groves was not available to the Commonwealth on the established facts. However, he also held that, if the Commonwealth had waived the limitation defence, such waiver was revocable and indeed had been revoked. Further, no estoppel operated because the parties had not been in a relevant pre-existing legal relationship and the respondent had not been materially disadvantaged because any legal costs incurred would be recoverable by an appropriate costs order. Judgment was therefore entered for the Commonwealth. His Honour's consideration of the concept of pre-existing legal relationship took place prior to this Court's decision in Waltons Stores (Interstate) Ltd. v. Maher (1988) 164 CLR 387. Since that case, if a pre-existing legal relationship is needed in order to found a promissory estoppel, it is clearly present in the plaintiff-defendant relationship in this case. However, this is not sufficient to dispose of the appeal.

11. The respondent appealed to the Full Court of the Supreme Court which allowed the appeal by majority (Kaye and Marks JJ.; King J. dissenting). The Court unanimously rejected the respondent's argument that the Commonwealth had waived its defences, but the majority held that the Commonwealth was estopped from resiling from its promise not to plead the Statute. King J. would have held that the respondent was entitled only to receive an amount representing the out-of-pocket costs and expenses incurred by him as a result of the change of mind by the Commonwealth. Kaye and Marks JJ. also dismissed a cross-appeal by the Commonwealth against O'Bryan J.'s decision that the public policy defence was not available to the Commonwealth. Accordingly, it was ordered that judgment for the Commonwealth be set aside and that the proceedings be remitted for trial.

12. In this Court, Mr Black Q.C., for the Commonwealth, argued that the majority in the Full Court had erred in granting to the respondent a remedy on the grounds of estoppel which was disproportionate to the detriment resulting from the respondent's reliance upon the Commonwealth's representation that it would not rely on the Act or the Groves defence. He also contended that, on grounds of public policy flowing from the decision in Groves, there was no duty of care owed towards the respondent in the circumstances of the case. The Groves issue does not arise if Mr Black's first argument is accepted. Moreover, the failure of the first argument would prevent the Commonwealth from relying upon the Groves defence even if it would otherwise have been available on the facts of the case. It is convenient therefore to concentrate first upon the effect of the Commonwealth's statements as to the defences it would not plead.

13. Mr Thomson Q.C., for the respondent, contended that the majority in the Full Court had correctly applied the law relating to estoppel. In the alternative, he argued, contrary to the decision of the Full Court, that the Commonwealth had voluntarily and irrevocably waived the benefit of a statutory right, namely its right to plead the Act as a complete defence. He also contended that O'Bryan J. and the Full Court had been correct in holding that the Commonwealth could not avail itself of the public policy defence based on Groves. Although the respondent did not file a notice of contention giving notice of his intention to rely upon the second of these arguments, the Commonwealth did not object to the course which the argument took. In any event, the dividing line between waiver and estoppel is, to say the least of it, by no means clear cut.

14. Putting estoppel to one side for the moment, it is desirable to consider, as Mr Thomson invited, the existence of a doctrine of "waiver of the benefit of a statutory right". Undoubtedly, some statutory rights are capable of being extinguished by the person for whose benefit they have been conferred: Sandringham Corporation v. Rayment (1928) 40 CLR 510 at p 527; Wilson v. McIntosh (1894) AC 129 at pp 133-134. However, some statutory rights may also operate as a condition precedent to a court's jurisdiction: Park Gate Iron Co. v. Coates (1870) LR 5 CP 634; Kammins Co. v. Zenith Investments (1971) AC 850. More importantly, some rights may be conferred for reasons of public policy so as to preclude contracting out or abandonment by the individual concerned: see Lieberman v. Morris (1944) 69 CLR 69. It is therefore necessary to examine the relevant statutory provision in this case in order to ascertain whether it is susceptible to extinguishment in this way.

15. Section 5(6) of the Act provided:

"No action for damages for negligence ..., where the damages claimed by the plaintiff consist of or include damages in respect of personal injuries to any person, shall be brought after the expiration of three years after the cause of action accrued."

This sub-section was repealed by s.3(c) of the Limitation of Actions (Personal Injury Claims) Act 1983 (Vict.). However, s.11(2) of that Act provided:

"The Acts amended by this Act shall apply as in force immediately before the commencement of this Act to a cause of action arising more than six years before the date of commencement of this Act."

That Act was proclaimed to commence on 11 May 1983.

16. Although the terms of s.5(6) are such that it is susceptible of being read as going to the existence of the jurisdiction of a court to hear and determine an action of the kind described, limitation provisions similarly expressed have not been held to limit the jurisdiction of courts. Instead, they have been held to bar the remedy but not the right and thus create a defence to the action which must be pleaded: Dawkins v. Lord Penrhyn (1878) 4 App Cas 51 at pp 58-59; The Llandovery Castle (1920) P 119 at p 124; Dismore v. Milton (1938) 3 All ER 762; Ronex Properties v. John Laing (1983) QB 398; Ketteman v. Hansel Properties (1987) AC 189 at p 219.

17. On the footing that the right to plead the statute as a defence is a right conferred by statute, the respondent's contention that the right is capable of waiver hinges on the scope and policy of the particular statute: Admiralty Commissioners v. Valverda (Owners) (1938) AC 173 at p 185. The issue is not whether the relevant provisions are beneficial to the public, but whether they are "dictated by public policy" and enacted "not for the benefit of any individuals or body of individuals, but for considerations of State": at p 185. Although, in one sense, all statutes give effect to some public policy (see Lieberman v. Morris at pp 82, 84), the critical question is whether the benefit is personal or private or whether it rests upon public policy or expediency: Brown v. The Queen (1986) 160 CLR 171 at p 208.

18. In this case there is the public policy that there should be finality in civil litigation. However, the Parliament has seen fit to implement this policy, not by imposing a jurisdictional restriction, but by conferring on defendants a right to plead as a defence the expiry of the relevant time period. In these circumstances and having regard to the nature of the statutory defence, I conclude that the purpose of the statute is to confer a benefit upon persons as individuals rather than to meet some public need which must be satisfied to the exclusion of the right of access of individuals to the courts. On that basis, it is possible to "contract out" of the statutory provisions, and it is equally possible to deprive them of effect by other means such as waiver. Put differently, the provisions are procedural rather than substantive in nature, which suggests that they are capable of waiver: Admiralty Commissioners v. Valverda, at p 185.

19. But, granted that some statutory rights can be waived, the mere existence of cases in which statutory rights have been held to be susceptible to waiver does not signify that those cases are all exemplifications of one concept or doctrine. As often as not, the term "waiver" is used to describe the result of the application of various principles rather than to designate a particular legal concept or doctrine. The consequence is that the expression "waiver" has been the subject of robust criticism, notably by Dr Ewart in his work Waiver Distributed, (1917); see also Bysouth v. Shire of Blackburn and Mitcham (No. 2) (1928) VLR 562 at p 579; Larratt v. Bankers and Traders' Insurance Co. (1941) 41 SR (NSW) 215 at p 226; Kammins, per Lord Diplock at pp 882-883. This is because "waiver" is an imprecise term capable of describing different legal concepts, notably election and estoppel.

20. It has been doubted that waiver exists as a defence or answer in any case except where it is used as an alternative designation for some other defence or answer, for example, election, estoppel or new agreement: Bysouth, per Lowe J. at p 579. Generally speaking, as Jordan C.J. pointed out in Larratt (at pp 226-227), an existing legal right is not destroyed by mere waiver in the sense of an express or implied intimation that the person in whom the right is vested does not intend to enforce it: see Mulcahy v. Hoyne (1925) 36 CLR 41 per Isaacs J. at pp 55-56; Atlantic Shipping and Trading Co. v. Louis Dreyfus and Co. (1922) 2 AC 250 per Lord Sumner at pp 261-262. In these cases, unless consideration is present, something in the nature of an election or an estoppel is required.

21. According to its strict legal connotation, waiver is an intentional act done with knowledge whereby a person abandons a right by acting in a manner inconsistent with that right: Craine v. Colonial Mutual Fire Insurance Co. Ltd. (1920) 28 CLR 305 at p 326; Grundt v. Great Boulder Pty. Gold Mines Ltd. (1937) 59 CLR 641 at p 658. However, the better view is that, apart from estoppel and new agreement, abandonment of a right occurs only where the person waiving the right is entitled to alternative rights inconsistent with one another, such as the right to insist on performance of a contract and the right to rescind for essential breach: see Kammins, at p 883. This category of waiver is an example of the doctrine of election.

22. Another category of waiver is one in which a person is prevented from asserting, in response to a claim against him, a particular defence or objection which would otherwise have been available. Here waiver is said to arise when the person agrees not to raise the particular defence or so conducts himself as to be estopped from raising it: see Kammins, at p 883.

23. In these circumstances, the authorities dealing with waiver of statutory rights do not call for special consideration. They speak with different voices, sometimes in the language of election, at times in that of estoppel and at other times in terms of unconscionability: see, for example, Ward v. Raw (1872) LR 15 Eq 83; Phillips v. Martin (1890) 11 NSWLR 153 at pp 157-158, 159; Wilson v. McIntosh. Quasi-estoppel by acquiescence is another approach which has found favour: Willmott v. Barber (1880) 15 Ch D 96, at pp 105-106; Kammins at pp 884-885. The old references to unconscionability may be taken today as forerunners of the modern principles of estoppel, now that prevention of unconscionable conduct has been identified as the driving force behind equitable estoppel: Waltons Stores, at pp 404, 419, 450.

24. It is necessary to consider whether, first, the doctrine of election and, secondly, the principles of estoppel (including quasi-estoppel by acquiescence) apply in the present case. The broad principles of election are not in doubt. They were formulated by this Court, under the title of waiver, in Craine v. Colonial Mutual, at p 326; see also O'Connor v. S.P Bray Ltd. (1936) 36 SR (NSW) 248 at pp 257-264. In Sargent v. A.S.L. Developments Ltd. (1974) 131 CLR 634 Stephen J. explained (at p 641):

"The doctrine only applies if the rights are inconsistent the one with the other and it is this concurrent existence of inconsistent sets of rights which explains the doctrine; because they are inconsistent neither one may be enjoyed without the extinction of the other and that extinction confers upon the elector the benefit of enjoying the other, a benefit denied to him so long as both remained in existence."

See also per Mason J. at p 656.

25. The respondent contends that the Commonwealth was required to elect between two inconsistent rights, namely, the right to plead and the right not to plead. The defences could be either pleaded or not pleaded; and a choice needed to be made as to which course to follow. But that is by no means the end of the matter because it is not clear that one of these "rights" could not be enjoyed without the extinction of the other. Indeed, the Commonwealth argues that, subject to the grant of leave to amend the pleadings, there was nothing to prevent it from adopting the right which the respondent claims was extinguished. The essential preliminary question is therefore whether or not the Commonwealth was required to make an irrevocable choice between two alternative positions; if it was not, then the two cannot be said to have been relevantly inconsistent, and the doctrine of election would not come into play.

26. The respondent's contention is that, by filing a defence omitting reference to the Act and the Groves defence, the Commonwealth had irrevocably elected not to plead the defences available to it. The immediate difficulty with that contention is that it does not account for the possibility that leave may be granted to amend the pleadings for the purpose of including the defences. The respondent could not point to any authority in which the filing of a defence was said to amount to an election in this way. Indeed, there is support for the contrary view, based upon the following passage from the judgment of Viscount Simon LC. in United Australia Ltd. v. Barclays Bank Ltd. (1941) AC 1 at pp 18-19:

"No doubt, if the plaintiff proved the necessary facts, he could be required to elect on which of his alternative causes of action he would take judgment, but that has nothing to do with the unfounded contention that election arises when the writ is issued. There is nothing conclusive about the form in which the writ is issued, or about the claims made in the statement of claim. A plaintiff may at any time before judgment be permitted to amend. ... At some stage of the proceedings, the plaintiff must elect which remedy he will have. There is, however, no reason of principle or convenience why that stage should be deemed to be reached until the plaintiff applies for judgment."

See also per Lord Atkin at pp 29-31. That case involved the quite different question whether the initiation of proceedings against one defendant precluded the bringing of an action against a second defendant on the basis of the same facts. Of course, the decision provides no support for the view that a defendant will not need to elect whether or not to plead a defence until the plaintiff seeks judgment. Nonetheless, the general statements in relation to the plaintiff's opportunities to amend the pleadings have at least equal force when applied to a defendant.

27. This is not a case in which it could be said that the defendant was required by a certain point in time to elect whether or not to plead the defences. If there was no need to make an election when the defence was first filed, there is no reason why the comparatively insignificant proceedings which followed gave rise to such a need and precluded the reversal of the previous decision. If the facts give rise to a conclusion that the Commonwealth's decision was irrevocable, then the reason is not to be found in the principles of election.

28. That brings me to estoppel, a label which covers a complex array of rules spanning various categories. There are the divisions between common law and equitable estoppel, between estoppel by conduct and estoppel by representation, and the distinction between present and future fact. There are titles such as promissory estoppel, proprietary estoppel and estoppel by acquiescence. Yet all of these categories and distinctions are intended to serve the same fundamental purpose, namely "protection against the detriment which would flow from a party's change of position if the assumption (or expectation) that led to it were deserted": Waltons Stores, per Brennan J. at p 419. See also per Mason C.J. and Wilson J. at p 404; Grundt, at pp 674-675.

29. At common law the principle of estoppel by conduct or representation ("estoppel in pais") provided that protection by preventing the party estopped from unjustly departing from an assumption of fact which his conduct had caused another party to adopt or accept for the purpose of their legal relations: Grundt, at pp 657, 674; Thompson v. Palmer (1933) 49 CLR 507 at p 547; Waltons Stores, at pp 397-399, 413-415, 443, 458. But it was well established that, in order to support an estoppel by conduct, the representation (or assumption) must be a representation of an existing fact, a promise or representation of intention to do something being insufficient for that purpose: Yorkshire Insurance Co. v. Craine (1922) 2 AC 541 at p 553.

30. The principle of estoppel by conduct or representation applied in equity, as at common law, though in equity the principle was known as equitable estoppel: Jorden v. Money (1854) 5 HLC 185 at pp 210, 212-213 (10 ER 868 at pp 880, 881); Thompson v. Palmer, at pp 519-520, 547, 558; Waltons Stores, at pp 447-448. And in equity it was also well settled that the representation (or assumption) must be of an existing fact, not of future fact or mere intention. That is what Jorden v. Money decided, despite the fact, as Bowen LJ. pointed out in Edgington v. Fitzmaurice (1885) 29 Ch D 459 at p 483, that "the state of a man's mind is as much a fact as the state of his digestion". This limitation upon the principle of estoppel was seemingly founded upon the notion that to hold a person to an assumption which his conduct has caused another to adopt or accept was tantamount to enforcing a voluntary promise in the absence of consideration. The need to avoid this consequence was an important aspect of the majority reasoning in Jorden v. Money.

31. However, neither the decision nor the reasoning in that case can now be sustained. Promissory estoppel, recognized by this Court in Legione v. Hateley (1983) 152 CLR 406, has undermined the idea that voluntary promises cannot be enforced in the absence of consideration. What is more, promissory estoppel has an extensive area of operation now that it is acknowledged that the doctrine is not confined to pre-existing contractual relationships: see Waltons Stores, at pp 399-406. Furthermore, the acceptance of the doctrine of promissory estoppel has been accompanied by a recognition that the distinction between present and future fact is unsatisfactory and produces arbitrary results instead of serving any useful purpose: Moorgate Ltd. v. Twitchings (1976) QB 225 at p 242; Waltons Stores, at pp 398-399, 450-451, 452; Foran v. Wight (1989) 64 ALJR 1 at pp 12, 22-23; 88 ALR 413 at pp 430-431, 448-449. Indeed, the difference between the majority and Lord St Leonards in Jorden v. Money was a striking illustration of the arbitrary nature of the distinction.

32. In conformity with the fundamental purpose of all estoppels to afford protection against the detriment which would flow from a party's change of position if the assumption that led to it were deserted, these developments have brought a greater underlying unity to the various categories of estoppel. Indeed, the consistent trend in the modern decisions points inexorably towards the emergence of one overarching doctrine of estoppel rather than a series of independent rules: see Waltons Stores, at pp 403-404, 447-451; Foran v. Wight, at pp 12, 22-23; pp 430-431, 448-449 of ALR; Collin v. Holden (1989) VR 510 at pp 515-516; Taylors Fashions Ltd. v. Liverpool Trustees Co. (1982) QB 133 at p 153; Amalgamated Property Co. v. Texas Bank (1982) QB 84 at p 122; Attorney-General of Hong Kong v. Humphreys Estate (1987) AC 114 at pp 123-124.

33. One obstacle to the existence of a single overarching doctrine is a suggested difference in the nature of estoppel by conduct on the one hand and equitable estoppel (including promissory estoppel) on the other and in the character of the protection which they respectively provide. Traditionally, estoppel by conduct has been classified as a rule of evidence, available where there is a cause of action, to prevent a person from denying what he previously represented, and has not itself constituted a cause of action: Grundt, at p 658; Low v. Bouverie (1891) 3 Ch 82 at pp 101, 105. Being an evidentiary principle, estoppel by conduct achieved, and could only achieve, the object of avoiding the detriment which would be suffered by another in the event of departure from the assumed state of affairs by holding the party estopped to that state of affairs. The rights of the parties were ascertained and declared by reference to that state of affairs. On the other hand, equity was more flexible. Equity was concerned, not to make good the assumption, but to do what was necessary to prevent the suffering of detriment. To do more would sit uncomfortably with a general principle whose underlying foundation was the concept of unconscionability. So, in Waltons Stores, a majority of this Court concluded that equitable estoppel entitled a party only to that relief which was necessary to prevent unconscionable conduct and to do justice between the parties. Mason C.J. and Wilson J. referred (at p 404) to the statement of Scarman L.J. in Crabb v. Arun District Council (1976) Ch 179 at p 198, that the court should determine what was "the minimum equity to do justice to the plaintiff". We went on to state (at p 405):

"Holding the representor to his representation is merely one way of doing justice between the parties."

Similarly, Brennan J. said (at p 419):

"The element which both attracts the jurisdiction of a court of equity and shapes the remedy to be given is unconscionable conduct on the part of the person bound by the equity, and the remedy required to satisfy an equity varies according to the circumstances of the case. As Robert Goff J. said in Amalgamated Property Co. v. Texas Bank (1982) QB 84 at p 103: 'Of all doctrines, equitable estoppel is surely one of the most flexible.' ... However, in moulding its decree, the court, as a court of conscience, goes no further than is necessary to prevent unconscionable conduct."

34. It follows that, as a matter of principle and authority, equitable estoppel will permit a court to do what is required in order to avoid detriment to the party who has relied on the assumption induced by the party estopped, but no more. In appropriate cases, that will require that the party estopped be held to the assumption created, even if that means the effective enforcement of a voluntary promise. To that extent there is an overlap between equitable estoppel generally and estoppel by conduct in its traditional form. But since the function of equitable estoppel has expanded and it has become recognized that an assumption as to future fact may ground an estoppel by conduct at common law as well as in equity, it is anomalous and potentially unjust to allow the two doctrines to inhabit the same territory yet produce different results. Moreover, as I have already indicated, the fact that estoppel by conduct has expanded beyond its evidentiary function into a substantive doctrine means that there is no longer any justification for insisting on the making good of assumptions in every case.

35. In any event, there is a very strong case for saying that equity had discarded earlier the notion that the purpose of the rules of estoppel by conduct was to make good the relevant assumption. As Professor Finn points out in his essay "Equitable Estoppel" in Finn (ed.), Essays in Equity, (1985), at p 68, "the language of expectations (was) forsaken entirely for that of 'equities'" in Crabb v. Arun District Council. Lord Denning M.R. had qualified the language of expectations in E.R. Ives Investment Ltd. v. High (1967) 2 QB 379 at pp 394-395, by stating that the "court will not allow (the) expectation to be defeated when it would be inequitable so to do" (emphasis added). That qualification, made repeatedly in cases which can be traced back to the Privy Council's statement in Plimmer v. Mayor, and, of Wellington (1884) 9 App Cas 699 at p 714, that "the Court must look at the circumstances in each case to decide in what way the equity can be satisfied", has transformed the basis of the equitable principles of estoppel: see Finn, at pp 62-71.

36. In these circumstances, it would confound principle and common sense to maintain that estoppel by conduct occupies a special field which has as its hallmark function the making good of assumptions. There is no longer any purpose to be served in recognizing an evidentiary form of estoppel operating in the same circumstances as the emergent rules of substantive estoppel. The result is that it should be accepted that there is but one doctrine of estoppel, which provides that a court of common law or equity may do what is required, but not more, to prevent a person who has relied upon an assumption as to a present, past or future state of affairs (including a legal state of affairs), which assumption the party estopped has induced him to hold, from suffering detriment in reliance upon the assumption as a result of the denial of its correctness. A central element of that doctrine is that there must be a proportionality between the remedy and the detriment which is its purpose to avoid. It would be wholly inequitable and unjust to insist upon a disproportionate making good of the relevant assumption. (See also the conclusion of Lord Denning M.R. in Amalgamated Property Co. v. Texas Bank, at p 122.)

37. The assumption may be one as to a legal as well as to a factual state of affairs. There is simply no reason to restrict the assumption to a factual matter as there was at the time when the rules of estoppel by conduct were evidentiary. It has already been recognized that an equitable estoppel may relate at least to a matter of mixed fact and law (see Waltons Stores, at pp 415-416, 420-421, 452; Foran v. Wight, at p 22; p 448 of ALR). Moreover, the distinction between assumptions as to fact and assumptions as to law is artificial and elusive; see the discussion of Oliver J. in Taylors Fashions Ltd. v. Liverpool Trustees Co., at pp 150-151. So it would be productive only of confusion and arid technicality to restrict the operation of the doctrine so as to exclude from its scope an assumption as to a purely legal state of affairs. It is therefore not surprising that long ago the Judicial Committee recognized that a representation as to the legal effect of an agreement can give rise to an estoppel: Sarat Chunder Dey v. Gopal Chunder Laha (1892) LR 19 Ind App 203; Calgary Milling Co. Ltd. v. American Surety Co. of New York (1919) 3 WWR 98; see also Amalgamated Property Co. v. Texas Bank, at pp 106-107.

38. Turning to the facts of the present case, at least in so far as the statutory defence is concerned, the difficulty facing the respondent at the outset is to establish that the required assumption was induced by the Commonwealth. What must be established is either that the Commonwealth represented that it had decided not to plead the Statute or the Groves defence and that it did not regard itself as free to change its decision (cf. Waltons Stores, at pp 422-423) or that the Commonwealth represented that it would not plead those defences.

39. In an ordinary case, the nature of pleadings and their susceptibility, whether by leave or otherwise, to amendment would make it most unlikely that it could be inferred from the pleadings alone that the pleader had induced another party to make an assumption that a particular matter would or would not be pleaded. The other party might reasonably be expected to appreciate that no inference can be drawn from the state of the pleadings alone at a particular time as to the future course which the pleader may decide to take. Still less would it be reasonable to assume that an implied promise not to amend the pleadings, if such a promise could be identified, would be enforceable in the absence of consideration: see Waltons Stores, at p 403.

40. However, in the present case the respondent is able to point to more than the mere filing and serving of the defence by the Commonwealth. There were clear indications that a deliberate and considered decision had been made whereby the limitation defence and the defence of no duty of care would not be pleaded in any of the ensuing actions brought by survivors of the collision. Those indications apparently included express representations to some claimants followed by the assessment and award of damages on the footing that no defence was pleaded. In the respondent's case, the Commonwealth had joined in making applications for an expedited hearing of the damages issue.

41. In all the circumstances the proper conclusion to be drawn is that the respondent had been induced by the Commonwealth's conduct to assume that the Commonwealth had made a decision not to plead the limitation defence or the Groves defence and that that decision would not be changed. The fact that the circumstances pointed to the existence of a definitive government policy which had been followed to the point of judgment on other occasions supports the conclusion that that assumption was a reasonable assumption for a person in the respondent's position to make. The relevance of this conclusion is that there is no reason to doubt the respondent's assertion that he made the assumption and continued his action against the Commonwealth in reliance on it.

42. The element of detriment presents more difficulty. Of course the respondent would suffer detriment in reliance on the assumption if the Commonwealth were to depart from it, at least in the sense that he would fail in his action for damages. However, the question of detriment is not as simple as such an answer would suggest, and is closely related to the other elements of the claim of estoppel.

43. When a person relies upon the correctness of an assumption which is subsequently denied by the party who has induced the making of the assumption, two distinct types of detriment may be caused. In a broad sense, there is the detriment which would result from the denial of the correctness of the assumption upon which the person has relied. In a narrower sense, there is the detriment which the person has suffered as a result of his reliance upon the correctness of the assumption.

44. The cases concerning estoppel by conduct, at least at common law, were in one respect concerned with the broader concept of detriment. So, Dixon J. said in Grundt, at p 674, that "the real detriment or harm from which the law seeks to give protection is that which would flow from the change of position if the assumption were deserted that led to it". This makes it clear that the detriment must flow from the reliance upon the assumption (see Foran v. Wight, at p 12; p 431 of ALR), but goes further and suggests that the relief granted by virtue of the estoppel (in that context, the making good of the assumption) corresponds with the detriment which would be suffered were the assumption to be deserted. However, that further suggestion was dictated by the then existing confines of the rules of estoppel by conduct; Dixon J. was plainly stating that a person's "change of position" could not be allowed to "operate as a detriment": at p 674. His Honour's exposition is now instructive as an indication that the detriment against which the law protects is that which flows from reliance upon the deserted assumption, even though at that time the evidentiary rule operated to hold the representor to the assumption created.

45. In the same way, cases of equitable estoppel have been concerned to grant relief where detriment would be suffered if the assumed state of affairs upon which reliance had been placed was held not to exist. But, as we have seen, the relief which equity grants is by no means necessarily to be measured by the extent of that detriment. So, while detriment in the broader sense is required in order to found an estoppel (and it would be strange to grant relief if such detriment were absent), the law provides a remedy which will often be closer in scope to the detriment suffered in the narrower sense.

46. It remains only to determine what relief is appropriate to satisfy the estoppel which the respondent has successfully raised in this case. When a court approaches the task of ascertaining the minimum relief necessary to "do justice" between the parties, it is not correct to make an assessment of the moral rectitude of the actions of the parties in a manner divorced from a consideration of the legal consequences and attributes of those actions. Thus it must be borne in mind that a voluntary promise is generally not enforceable and that pleadings are susceptible of amendment. The breaking of a promise, without more, is morally reprehensible, but not unconscionable in the sense that equity will necessarily prevent its occurrence or remedy the consequent loss. In the same way, with estoppel, something more than a broken promise is required.

47. Each case is one of degree. Reliance upon an assumption for an extended period may give rise to an estoppel justifying a court in requiring that the assumption be made good. The same result may follow from substantial and irreversible detriment suffered in reliance upon the assumption or from detriment which cannot satisfactorily be compensated or remedied. In the present case the detriment suffered by the respondent in reliance on the assumption induced by the Commonwealth appears to be of a more limited nature. The procedure adopted for the determination of this case in the Supreme Court means that we have no finding or evidence of the detriment, flowing from his reliance upon the assumption, which the respondent would suffer from the Commonwealth's pleading of the limitation defence or the Groves defence. It must be assumed, however, that that detriment would include significant expense and inconvenience. However, as far as the respondent's emotional condition is concerned, it is sheer speculation to suggest that his reliance on the Commonwealth's actions after commencement of the action caused any deterioration of that condition. Evidence of detriment must be affirmatively demonstrated; this is not a case involving the exercise of judicial discretion: cf. Murray v. Munro (1906) 3 CLR 788 at p 796; Ketteman v. Hansel Properties, at p 220.

48. The question then is whether an order for costs is a sufficient recompense for the respondent in respect of the detriment suffered by him. An order for costs has traditionally been regarded as a sufficient adjustment to meet prejudice in terms of expense and inconvenience occasioned by the pleading of new defences and I am not persuaded that principle or circumstance call for any different answer in the present case. There is no material before the Court to justify a conclusion that the respondent commenced his action on the basis of any express or implied representation on the part of the Commonwealth. The respondent's solicitors inquired of the Secretary of the Department of Defence in September 1984 whether he would agree to waive the Statute of Limitations and admit liability. The relevant Minister replied on 29 October 1984, stating that the matter had been referred for consideration to the Australian Government Solicitor. The statement of claim was issued on 2 November 1984. It can hardly be said that these circumstances establish the existence of an assumption on the part of the respondent that liability was not in issue. Indeed, the Minister's letter alerted the respondent's solicitors to the fact that, although the defences had not been pleaded when the question had previously arisen, the Commonwealth still saw fit to refer the question for legal advice on this occasion. If anything, this suggests the absence of a definite and unambiguous policy at the time when the respondent commenced his action.

49. To hold the Commonwealth to its representations, thereby depriving it of defences which were available to it by statute or the general law, would be a disproportionate response to the detriment suffered by the respondent in reliance upon the assumption that the defences would not be pleaded. True it is that the representations reflected a deliberate policy decision made by government at ministerial level at least. That circumstance gave the representations the quality of apparent reliability and went to the issue of reliance. But the apparent reliability of the representations does not enlarge the nature or scope of the detriment which the respondent has suffered in reliance on the representations following the denial of the assumption generated by them. Likewise, the fact that the Commonwealth is the party against whom an estoppel is pleaded is not in this case a point of distinction. It was not argued that any special rule of estoppel applies to assumptions induced by government, either so as to expand or so as to contract the field of operation of the doctrine.

50. In the result I conclude that the respondent's case of waiver and estoppel has not been made out and that the Full Court of the Supreme Court was wrong in holding otherwise. The appeal should be allowed.

BRENNAN J. The plaintiff issued a writ out of the Supreme Court of Victoria on 2 November 1984 claiming damages against the Commonwealth for injuries sustained by him, a leading electrical mechanic in the Royal Australian Navy and one of the complement of H.M.A.S. Voyager, in a collision between H.M.A.S. Melbourne and H.M.A.S. Voyager on 10 February 1964. By his statement of claim, the plaintiff alleged that he had suffered injury, loss and damage as the result of the negligence of the officers and crew of each ship. At the time of the collision, the two ships were engaged in training manoeuvres off Jervis Bay. Negligence was also alleged against officers and servants of the Commonwealth in allowing the ships to go to sea whilst in an unseaworthy condition.

2. The Commonwealth delivered a defence admitting the allegations of negligence but not admitting the allegations of injury, loss and damage. The action proceeded towards trial of the single issue of damages. The parties joined in several applications to the Court to expedite the hearing. Then, on 29 May 1986, an order was made by Master Brett giving the Commonwealth leave to amend the defence. By the amended defence, the plaintiff's allegations of negligence were denied and two specific grounds of defence were pleaded: first, by par.4, that the naval personnel participating in and/or directing the "combat exercises" in which H.M.A.S. Voyager and H.M.A.S. Melbourne were engaged owed no duty of care to the plaintiff; second, by par.5, that the plaintiff's action was barred by s.5 of the Limitation of Actions Act 1958 (Vict.) ("the Limitation Act"). The plaintiff delivered a reply raising waiver and estoppel against the specific pleas in the Commonwealth's amended defence. Particulars were furnished setting out, inter alia, the contents of a letter dated 27 November 1985 from the Minister Assisting the Minister for Defence to the plaintiff stating "... the Commonwealth has admitted negligence and is not pressing the statutory limitation period as a defence. ... I can assure you that all reasonable steps are being taken to expedite these matters ..." Moreover, conversations between the respective solicitors allegedly expressed an agreement to waive the defence under the Limitation Act. By his reply, the plaintiff pleaded that, in reliance on the defendant's agreement to waive and its waiver of the defence under the Limitation Act, he "issued and continued proceedings in this matter and has been otherwise disadvantaged." He furnished particulars of the allegation that he was "otherwise disadvantaged" as follows:

"The Plaintiff has lost rights pursuant to Section 23A of the Limitation of Actions Act 1958. The Plaintiff has issued and continued proceedings in the Supreme Court of Victoria. The Plaintiff has incurred expense by reason of costs associated with this action. The Plaintiff suffers from increased stress as a result of continued protraction of these proceedings leading to an aggravation of his psychiatric state of health."

3. When the matter came for trial before O'Bryan J., his Honour decided, over the plaintiff's objection, to hear argument on certain questions of law raised by the pleadings, taking the view that the facts relevant to these questions "were not in issue or would not be seriously disputed at trial." His Honour first considered whether on the facts relating to the collision - which had been set out in a notice to admit and which the plaintiff was taken to have admitted - any duty of care was owed by the defendant. On the facts thus admitted, his Honour found:

"that Melbourne and Voyager and their officers and crew were engaged in a naval training exercise at sea, during peace-time, whereby conditions of a nature which might be experienced during war-time against an enemy were simulated."

However, his Honour held that the defence pleaded in par.4 of the amended defence was not sound in law.

4. Next, his Honour held that s.5(6) of the Limitation Act applied to the plaintiff's claim. That provision read as follows:

" No action for damages for negligence ..., where the damages claimed by the plaintiff consist of or include damages in respect of personal injuries to any person, shall be brought after the expiration of three years after the cause of action accrued."

Then his Honour proceeded to consider whether the defendant had waived or was estopped from relying on the defence under s.5(6) of the Limitation Act. It was and is common ground that the Commonwealth had adopted a clear policy of admitting liability and not raising any applicable Limitation Act in any case in which a seaman injured in the collision between H.M.A.S. Melbourne and H.M.A.S. Voyager sued for damages. Then the policy changed and the Commonwealth decided to contest liability and rely on statutes of limitation in these cases. The question was and is whether this midstream change of policy came too late to relieve the Commonwealth from the liability which had theretofore been admitted in the plaintiff's case. The conduct of the defendant on which the plaintiff relied to raise waiver and estoppel was not in dispute. The relevant correspondence was produced. His Honour said:

"As there is no factual issue for a jury to determine, it is proper and convenient that the Court now determine the questions of law at issue."

It is by no means clear that the relevant facts as to detriment were agreed. In the course of argument before his Honour, counsel for the plaintiff had said that the plaintiff "undertook loan commitments for the purpose of carrying on his action". Counsel had also alleged that the amending of the defence (which "take(s) away the carrot, so to speak") would have "severe consequences upon the (plaintiff's) ill-health produced by the defendant's negligence." Having reserved consideration of the questions of waiver and estoppel, his Honour found:

" One may assume that the defendant by its authorised agents expressly or impliedly offered or promised the prospective plaintiff, shortly before the Writ was issued, that it would not rely upon a limitation defence. The problems for the plaintiff are that the offer or promise was not made by the defendant when the parties stood in a relevant legal relationship and that the offer or promise was unsupported by any form of consideration known to the law. Further, the plaintiff did not alter his position detrimentally in reliance upon the promise otherwise than by incurring legal costs."

And further -

"if the offer or promise relied upon was given as to future conduct, the necessary contractual relationship was absent, but if the promise was given as to the present, detriment was absent. ... ... as a consequence of the promise the plaintiff was
not materially disadvantaged because the legal costs he incurred will be recoverable by an appropriate costs order."

His Honour's finding that legal costs were the only material detriment did not accord with the assertion that the plaintiff had suffered exacerbation of his ill-health and that that was a material detriment. His Honour rejected estoppel as an answer to the plea based on the Limitation Act as the plaintiff had suffered no detriment other than costs; he rejected waiver on the ground advanced in Kerrison v. Martin and Heyward (1975) VR 401, where the Full Court had said (at p 405):

" However it is, we think, clear that any such unilateral waiver without consideration can be terminated at any time. Upon the waiver terminating, the other party would we think have a reasonable time in which to do the act which that other party had omitted to perform."

His Honour held:

" In the present case the waiver relied upon is, in my opinion, unilateral and voluntary and the defendant was entitled to withdraw the offer or promise when it did by giving notice of an application to amend the defence."

Rejecting both waiver and estoppel, his Honour upheld the defence under s.5(6) of the Limitation Act and ordered that judgment be entered for the defendant. On appeal by the plaintiff to the Full Court the majority (Kaye and Marks JJ.) allowed the appeal with costs, ordered the judgment for the defendant to be set aside and remitted the matter for trial by jury on the issues of negligence and damages. Their Honours dismissed the defendant's cross-appeal. King J. would have ordered an inquiry into the out-of-pocket costs and expenses suffered by the plaintiff by reason of the Commonwealth's change of mind and would have ordered the Commonwealth to pay any sum found to be due by the inquiry but, subject to that, he would have dismissed the appeal.

5. The present appeal is not an appeal against Master Brett's order allowing the Commonwealth to amend its defence. The amendment stands and the questions raised on the appeal are whether the Commonwealth is precluded from relying on pars 4 and 5 of its amended defence by reason of estoppel or waiver.

6. Election, estoppel and waiver are cognate concepts: each relates to the sterilization of a legal right otherwise than by contract. A "right" may include a liberty or an immunity, according to the circumstances. In Sargent v. A.S.L. Developments Ltd. (1974) 131 CLR 634, Mason J. said (at p 655):

" Any discussion of the principles governing the circumstances in which a party's words or conduct may preclude him from exercising a legal right which he possesses is beset with difficulties. They have their origin in the differences to be found in the various doctrines (election, waiver and estoppel) which may come into operation and in the differing concepts which each doctrine has at times been thought to embrace."

Election consists in a choice between rights which the person making the election knows he possesses and which are alternative and inconsistent rights: Evans v. Bartlam (1937) 2 All ER 646, at pp 652,653; Tropical Traders Ltd. v. Goonan (1964) 111 CLR 41 at p 55; Kammins Co. v. Zenith Investments (1971) AC 850 at p 883. A doctrine closely related to election, and sometimes treated as a species of election, is the doctrine of approbation and reprobation. This doctrine precludes a person who has exercised a right from exercising another right which is alternative to and inconsistent with the right he exercised as, for example, where a person "having accepted a benefit given him by a judgment, cannot allege the invalidity of the judgment which conferred the benefit": Evans v. Bartlam, per Lord Russell of Killowen at p 652. An election is binding on the party who makes it once it is made overtly - or, at all events, not later than on the communication of the election to the party or parties affected thereby: Newbon v. City Mutual Life Assurance Society Ltd. (1935) 52 CLR 723 at p 733; Scarf v. Jardine (1882) 7 App Cas 345 at pp 360-361. It is binding whether or not others who are affected by the election have acted in reliance on it. In this respect, election is to be distinguished from estoppel: Khoury v. Government Insurance Office (N.S.W.) (1984) 165 CLR 622 at p 633.

7. Estoppel by representation of a fact (estoppel in pais) precludes a party who, by his representation, has induced another party to adopt or accept the fact and thereby to act to the other party's detriment from asserting a right inconsistent with the fact on which the other party acted: Thompson v. Palmer (1933) 49 CLR 507; Grundt v. Great Boulder Pty. Gold Mines Ltd. (1937) 59 CLR 641. Equitable estoppel or, as I prefer to call it, an equity arising by estoppel precludes a person who, by a promise, has induced another party to rely on the promise and thereby to act to his detriment from resiling from the promise without avoiding the detriment: Waltons Stores (Interstate) Ltd. v. Maher (1988) 164 CLR 387 at p 427. An equity of this kind, by imposing a liability either to avoid detriment to the other party or to honour the promise, trenches upon the liberties or immunities of the person who is bound. An estoppel, whether in pais or arising in equity, is binding so soon as it is acted on to the detriment of the other party.

8. Waiver is a term of shifting meaning. Lord Wright in Smyth and Co. v. Bailey and Co. (1940) 3 All ER 60 said (at p 70):

" The word 'waiver' is a vague term used in many senses. (Stroud's Judicial Dictionary lists at least 13.) It is always necessary to ascertain in what sense and with what restrictions it is used in any particular case. It is sometimes used in the sense of election as where a person decides between two mutually exclusive rights. Thus, in the old phrase, he claims in assumpsit and waives the tort. It is also used where a party expressly or impliedly gives up a right to enforce a condition or rely on a right to rescind a contract, or prevents performance, or announces that he will refuse performance, or loses an equitable right by laches."

To identify the relevant legal doctrine, it is necessary to identify the sense in which we intend to use the term "waiver". In this case, there is no contract to admit liability (a proposition considered in Newton, Bellamy and Wolfe v. S.G.I.O. (1986) 1 Qd R 431) and we can put aside until we consider estoppel the kind of waiver which depends on the suffering of detriment by a person who relies on the waiver. We are concerned here with a unilateral release or abandonment of a right. In Banning v. Wright (1972) 1 WLR 972 at pp 978-979; (1972) 2 All ER 987 at p 998, Lord Hailsham of St Marylebone L.C. pointed out that "waiver" is derived from the same root as the word "waif" - a thing, or person, abandoned. Lord Hailsham, after citing the speech of Lord Wright (supra), continued:

"In my view, the primary meaning of the word 'waiver' in legal parlance is the abandonment of a right in such a way that the other party is entitled to plead the abandonment by way of confession and avoidance if the right is thereafter asserted."

In accord, see Halsbury's Laws of England, 4th ed. (1976), vol.16, par 1471. His Lordship must not be taken to be saying that waiver necessarily occurs before pleadings are closed. Clearly enough, rights are frequently waived during a trial. What his Lordship is saying is that a right which is susceptible of waiver can be "confessed" by a party against whom it might prima facie be exercisable but that party's liability can be "avoided" by showing that the right has been abandoned. In other words, upon waiver, the party waiving the right ceases to be able thereafter to assert it effectively. When a right has been waived in the sense defined by Lord Hailsham (and it is in this sense that it is used in this judgment), it is unnecessary to consider whether any other party has acted in reliance on the release or abandonment: the right is abandoned once and for all.

9. These distinct doctrines serve different purposes: election (in either species) ensures that there is no inconsistency in the enforcement of a person's rights; estoppel or equitable estoppel ensures that a party who acts in reliance on what another has represented or promised suffers no unjust detriment thereby; waiver recognizes the unilateral divestiture of certain rights. True it is that the divisions in nature and purpose between one of these doctrines and another have not always been expressed in the way in which I have stated them and there have been occasions when the sterilization of a right has been dubiously attributed to one doctrine rather than to another. Indeed, Lord Diplock in Kammins Co. (at p 883) regarded waiver which debars a person from raising a particular ground of defence as an instance of the operation of the law of contract or of the doctrine of estoppel, and in The "Kanchenjunga" (1990) 1 Lloyd's Rep 391 Lord Goff of Chieveley was concerned with "waiver" arising by "election". Yet it is clear that the doctrine of waiver has long been applied to grounds of defence without reference to estoppel and, shortly after Kammins Co., Banning v. Wright defined waiver as a doctrine distinct from estoppel. In Craine v. Colonial Mutual Fire Insurance Co. Ltd. (1920) 28 CLR 305 Isaacs J. (at p 327) distinguished waiver from estoppel, although he appeared to regard waiver as synonymous with election and the doctrine of approbating and reprobating: see p 326. The sterilizing of a right might, in some circumstances, be attributable to either a waiver or an election, but the doctrines are distinct, for a right may be waived though there is no alternative right inconsistent with it. As it is erroneous to treat waiver in the sense relevant to this case as synonymous with, or as a species of, estoppel, it is convenient to examine these doctrines separately. There is a difference in their respective applicability to the pleas in pars 4 and 5 of the amended defence.

Waiver

10. The general principle was stated by Alderson B. in Graham v. Ingleby (1848) 1 Ex 651 at p 657 (154 ER 277 at p 279):

"it is evident that a party who has a benefit given him by statute, may waive it if he thinks fit. There are many cases in which no action can be commenced except after certain notice of action. That is a requirement by statute; but if a plaintiff went to trial, and the defendant did not then object to the want of notice, could he afterwards set aside the whole proceedings because no notice was given? It is clear that he could not."

11. In Wilson v. McIntosh (1894) AC 129, a caveat had been lodged against an application to bring land under the Real Property Act 1862 (N.S.W.) (26 Vict. No.9) and, the time limited for the caveator to take proceedings to establish her title having passed, the caveat lapsed and the applicant was entitled to have the caveat removed. But the applicant proceeded to state his case and secured an order that the caveator should state her case, which she did. The applicant, having neglected to take any steps to set the matter down for hearing, applied to have the caveat removed on the ground that it had expired. The Privy Council ordered that the motion for removal be refused. Lord Justice Davey said (at p 133):

"Their Lordships are of opinion that the maxim 'Quilibet potest renunciare juri pro se introducto' applies to this case, that it was competent for the applicant to waive the limit of the three months and the lapse of the caveat by sect.23, and that the respondent did waive it by stating a case and applying for and obtaining an order upon the appellant to state her case, both which steps assumed and proceeded on the assumption of the continued existence of the caveat."

The maxim quoted by Lord Justice Davey is translated in Broom's Legal Maxims, 10th ed. (1939), p 477, as follows:

"Any one may, at his pleasure, renounce the benefit of a stipulation or other right introduced entirely in his own favour."

(See Bonner v. Wilkinson (1822) 5 B and Ald 682 at p 686 (106 ER 1340 at p 1341).) The learned author comments:

" According to the well-known principle expressed in this maxim, a defendant may, as a rule, decline to avail himself of a defence which would be at law a valid and sufficient answer to the plaintiff's demand, and waive his right to insist upon that defence."

12. As it is a characteristic of a right susceptible of waiver that it is introduced solely for the benefit of one party, a condition precedent to the jurisdiction of a court to grant relief cannot be waived: Park Gate Iron Co. v. Coates (1870) LR 5 CP 634. It follows that, if the jurisdiction of a court to entertain proceedings is conditioned on the commencement of the proceedings within a specified time, a defendant cannot waive the time requirement and thereby confer jurisdiction on the court. Conversely, where a case is fought on the issue whether a time limitation in a particular statute is or is not a condition precedent to jurisdiction, an argument that another statute overrides the time limitation can be raised on appeal though conceded in the court below: Adams v. Chas. S. Watson Pty. Ltd. (1938) 60 CLR 545 at pp 547,548. However, a defence under s.5(6) of the Limitation Act does not create a condition precedent to jurisdiction. It is merely a right conferred on a defendant to defeat a claim brought outside the time limited by the Limitation Act. In Australian Iron and Steel Ltd. v. Hoogland (1962) 108 CLR 471 at pp 488-489, Windeyer J. said:

"It seems that, under the common law system of pleading, when a limitation is annexed by a particular statute to a right it creates, the plaintiff should allege in his declaration that the action was brought within time. On the other hand it is for the defendant to plead the Statute of Limitations as a defence to an action on a common law cause of action, as if he does not it is assumed that he intends to waive it: see Chapple v. Durston ((1830) 1 C and J 1 at p 9 (148 ER 1311 at p 1314)). However, when issue is joined on a plea of the Statute, the burden of proving that the action is within time is on the plaintiff: see cases referred to by Dixon J., as he then was, in Cohen v. Cohen ((1929) 42 CLR 91 at p 97). And, even when a time limit is imposed by the statute that creates a new cause of action or right, it may be so expressed that it is regarded as having a purely procedural character, as a condition of the remedy rather than an element in the right; and in such cases it can, it seems, be waived, either expressly or in some cases by estoppel: Wright v. John Bagnall and Sons Ltd. ((1900) 2 QB 240); Lubovsky v. Snelling ((1944) KB 44)."

In Chapple v. Durston (1830) 1 C and J 1 at p 9 (148 ER 1311 at p 1314) Vaughan B., noting that the Statute of Limitations bars the remedy not the right (as does s.5(6) of the Limitation Act), said:

"If he intends to insist upon it, he should plead it to prevent surprise, and if he does not, it should be presumed he intends to waive it."

As the right created by s.5(6) is introduced solely for the benefit of a defendant, who must plead the right before it is effective, the right is capable of waiver by a defendant.

13. However, waiver does not apply to an element in a plaintiff's cause of action. An element in a cause of action simply does not answer the description of a right which has been introduced solely for the benefit of a defendant. It follows that the defence of s.5(6) of the Limitation Act is amenable to waiver but the issue of negligence is not.

14. The next question is whether the defence of s.5(6) was waived, that is to say, abandoned so that it was beyond the capacity of the Commonwealth thereafter to defeat the plaintiff's claim by invoking s.5(6). A failure to plead the Statute of Limitations does not, without more, establish a waiver of the statute. Subject to the Rules of Court, a pleading is always capable of amendment, at least until judgment is pronounced. It is no more than a party's definition of the issues which that party intends to litigate: see Laws v. Australian Broadcasting Tribunal (1990) 64 ALJR 412 at pp 418-419; 93 ALR 435 at pp 446,447. In the present case, however, there was much more than a failure to plead the Limitation Act. By the clearest communication and by its conduct, the Commonwealth declared its intention to abandon the defence. But does a clear and unequivocal declaration by a defendant that it will not raise a defence under s.5(6) of the Limitation Act amount to a waiver?

15. As the "right" (that is, the defence) conferred by s.5(6) is introduced solely for the benefit of a defendant and as a plaintiff can plead the abandonment of the right "by way of confession and avoidance if the right is thereafter asserted", there must be a time after which the defence can no longer be exercised. At what time must the defence be either raised or waived?

16. The time when waiver of a right occurs depends on the relationship between a party possessed of such a right and the party whose interests may be affected by exercise of the right. When the party possessed of the right knows that a new legal relationship is to be constituted between him and the party whose interests are liable to affection by exercise of the right and that the right, if exercised, might affect that new relationship, the party possessing the right must enforce the right before the new relationship is constituted or he will be held to have waived the right. The new relationship is typically created by the pronouncing of a judgment in which the existing rights of the parties are merged or by the making of an order, but it may be created in other ways. However created, it is on or before the constitution of the new relationship that the right must be exercised: the right is not waived until the last moment at which its exercise is capable of affecting the new relationship: see Ward v. Raw (1872) LR 15 Eq 83 at p 85. Once the new relationship is constituted without exercise of the right, it is immaterial that the relationship would not have been differently constituted had the right been exercised.

17. As a right is waived only when the time comes for its exercise and the party for whose sole benefit it has been introduced knowingly abstains from exercising it, a mere intention not to exercise a right is not immediately effective to divest or sterilize it. Vaughan B. in Chapple v. Durston was precise in speaking of a defendant's failure to plead a time bar not as a waiver but as the foundation for a presumption that the defendant "intends to waive it". Waiver of a time limitation which bars a remedy occurs only when the time for granting the remedy arrives, that is, the moment before judgment. Until that time arrives, the time limitation is not waived. If a party is to be held to an intention to waive the limitation, it can be only by contract or estoppel or, where the intention to waive appears from a failure to plead the limitation, by refusal of leave to amend the pleading (if leave be necessary and refusal of leave be justified).

18. In the present case, leave to amend was granted to the Commonwealth to plead s.5(6) of the Limitation Act; there was no prior contract binding on the Commonwealth not to plead it. The time for waiving the defence had not arrived. If the Commonwealth is to be held to its original intention not to waive the defence conferred by s.5(6) of the Limitation Act, it must be by reason of an equity arising from estoppel.

19. Waiver has no application to the general denial of negligence and to the specific denial in par.4 of the amended defence. Those paragraphs of the defence relate to the essential element in the plaintiff's cause of action, not to a right introduced for the benefit of a defendant. Again, if the Commonwealth is to be held to its original intention to admit liability for negligence, it must be by reason of an equity arising from estoppel.
Equitable estoppel

20. The Commonwealth made no misrepresentation of fact. Until the Commonwealth changed its policy, its intention was as it had represented its intention to be: to admit liability, not to rely on s.5(6) of the Limitation Act and to seek an assessment of damages. The Commonwealth's representations of fact were true when they were made, but the promises made by the Commonwealth - promises made gratuitously - were not to withdraw its admission of negligence and not to rely on s.5(6) of the Limitation Act and thus to submit to judgment for the plaintiff at the trial. Although waiver, in the sense earlier discussed, does not bind a party to fulfil such promises, there is at least a theoretical possibility that an equity arising from estoppel could be invoked to debar a defendant from resiling from a promise not to contest an issue at the trial or not to raise a defence. Sometimes an equity arising from estoppel has been described as a waiver. That was the type of "waiver" referred to by Neill J. in The "Athos" (1981) 2 Lloyd's Rep 74 at p 88, in a passage cited by Hirst J. in The "Uhenbels" (1986) 2 Lloyd's Rep 294 at p 297:

" The second type of waiver debars a person from raising a defence to a claim against him which would otherwise be available to him. This type of waiver arises when that person either agrees with the claimant not to raise that particular defence, or so conducts himself as to be estopped from raising it. The ordinary principles of estoppel apply to it. The statement or conduct which is said to found the estoppel must be clear and unequivocal and the other party must either have acted to his detriment or otherwise have conducted his affairs in reliance on that statement and conduct." (Emphasis added.)

The ordinary principles of equitable estoppel which might apply to a promise of this kind were discussed in Waltons Stores v. Maher.

21. The judgments of a majority of the Court in Waltons Stores v. Maher held that equitable estoppel yields a remedy in order to prevent unconscionable conduct on the part of the party who, having made a promise to another who acts on it to his detriment, seeks to resile from the promise: see pp 404,405,419. The remedy is to effect what Scarman LJ. called "the minimum equity to do justice" in Crabb v. Arun District Council (1976) Ch 179 at p 198: see Waltons Stores v. Maher, per Mason C.J. and Wilson J. at pp 404-405; per Brennan J. at pp 419,423,427. The remedy is not designed to enforce the promise although, in some situations (of which Waltons Stores v. Maher affords an example), the minimum equity will not be satisfied by anything short of enforcing the promise.

22. If this were a case where justice could not be done unless the Commonwealth were held to its promises, the equity would have to be satisfied by entry of an interlocutory judgment for the plaintiff and an order for the assessment of his damages. But that is not the minimum equity needed to avoid the relevant detriment. The relevant detriment in a case of equitable estoppel is detriment occasioned by reliance on a promise, that is, detriment occasioned by acting or abstaining from acting on the faith of a promise that is not fulfilled. The relevant detriment does not consist in a loss attributable merely to non-fulfilment of the promise. The principle is analogous to the principle of estoppel in pais: see Thompson v. Palmer, at pp 520,547. In the present case, it may be (as counsel for the plaintiff alleged) that the plaintiff's ill-health was exacerbated by the defendant's amendment of its defence. That allegation was not considered by the learned trial judge who found that the only detriment suffered consisted in the incurring of costs. But it was not suggested that any exacerbation of the plaintiff's ill-health flowed from some act done or omission made by him in reliance on the defendant's promise to admit or earlier admission of liability. Nor is the loss of the plaintiff's chance of success a detriment occasioned by any act done or omission made by the plaintiff in reliance on the defendant's promise to admit or earlier admission of liability. Those "detriments" flowed from the defendant's failure to fulfil its promise, but not from any act done or omission made by the plaintiff in reliance on the making of the promise. They are not relevant detriments.

23. The only relevant detriment which the plaintiff suffered, according to his pleadings and the argument of his counsel, was financial loss in continuing with the action until the defence was amended to deny negligence and to raise s.5(6) of the Limitation Act. In these circumstances, to hold the Commonwealth to its promise to admit liability in negligence would be to go beyond the minimum equity. It may be that the relevant financial detriment exceeded in amount the costs which were awarded to the plaintiff by the Master by the order giving leave to amend the defence. This question of fact was not investigated by O'Bryan J. nor by the majority of the Full Court who noted the plaintiff's counsel's concession before that Court that he had not wished to call evidence before the trial judge on the questions of waiver and estoppel and who concluded that the facts relating to waiver and estoppel were not in dispute before O'Bryan J. As I read their Honours' reasons for judgment, however, the facts relating to detriment were not regarded as critical provided only that some detriment was established. King J., however, was concerned by the absence of agreed facts as to detriment. He said ((1989) VR 712 at p 735):

" In Waltons' Case justice was satisfied only by awarding damages in lieu of enforcing Waltons' promise; in the present case it may be that it can be given by ordering that the respondent pay the difference between the appellant's costs thrown away on a solicitor-and-client basis and the party-party basis which I understand was ordered by the master."

His Honour would have ordered an inquiry into the plaintiff's out-of-pocket costs and expenses thrown away by the defendant's change of plea. The procedure adopted in the Courts below was not effective to determine the extent of the relevant detriment suffered by the plaintiff.

24. In strict theory, a party who is entitled to equitable relief to make good some detriment suffered in reliance on a promise has a cause of action rather than an answer to a plea raised by a defendant- promisor in proceedings to enforce another cause of action. But when an equity by way of estoppel is raised as an answer to a plea in a defence which a defendant-promisor seeks to raise contrary to his promise, it may be appropriate to give effect to the defence on terms that the defendant-promisor satisfy the plaintiff's equity. It would be an appropriate order in this case, where (if my view were to prevail) the plaintiff would ultimately be liable to fail on the ground pleaded in par.5 of the amended defence, that is, s.5(6) of the Limitation Act. As the extent of the plaintiff's detriment was not determined, the appropriate order would follow the order proposed by King J. However, mine is a minority view. The majority would hold that, by appropriate amendment of the reply, the Commonwealth can be made to fulfil its promises to admit negligence and not to raise the defence of s.5(6) of the Limitation Act.

25. On either view, no consideration need be given to the question whether there was any duty of care owed to the plaintiff by the naval personnel participating in and/or directing the "combat exercises" in which the collision occurred. I am thus relieved from determining whether or not the simulation of wartime conditions in training exercises, which necessarily entails personal hazards, precludes the existence of a duty of care - a question that was not necessary to decide in Groves v. The Commonwealth (1982) 150 CLR 113: see pp 119,134,136.

26. I would allow the appeal, set aside the order of the Full Court and in lieu thereof order: 1. that the matter be remitted to the trial judge to ascertain

what detriment was suffered by the plaintiff in continuing with the action until the defence was amended and what amount would be fair compensation for that detriment; and

2. that, upon payment by the defendant to the plaintiff of the

amount so ascertained, the action stand dismissed.

The plaintiff should pay the costs of the proceedings after amendment of the defence, and the parties should have leave to submit appropriate minutes of order setting off the amounts due between them.

DEANE J. The resolution of this case lies, in my view, in the application of the general doctrine of estoppel by conduct. In what follows, I explain in some detail why that is so. Subject to that, I am in general agreement with the analysis of the law and the facts contained in the judgment of Dawson J. and agree with his Honour's conclusion that the appeal should be dismissed. THE RELATIONSHIP BETWEEN PROMISSORY ESTOPPEL AND ESTOPPEL BY CONDUCT

2. In Waltons Stores (Interstate) Ltd. v. Maher (1988) 164 CLR 387 at pp 447-453, and Foran v. Wight (1989) 64 ALJR 1 at pp 22-23; 88 ALR 413 at pp 448-449, I attempted to explain the reasons which induced me to conclude that promissory estoppel should be seen not as a separate and distinct doctrine which operates only in equity but as an emanation of the general doctrine of estoppel by conduct which had been explained by Dixon J. in Thompson v. Palmer (1933) 49 CLR 507 at p 547, and Grundt v. Great Boulder Pty. Gold Mines Ltd. (1937) 59 CLR 641 at pp 674-677. I do not regard myself as constrained to depart from that conclusion by what was said in other judgments in those two cases. The support to be found in some of those other judgments for insistence upon a difference in nature between promissory estoppel and estoppel by conduct has, however, caused me to reconsider the question of the relationship between the two. That reconsideration has not caused me to abandon the view that promissory estoppel is but one aspect of a general doctrine of estoppel by conduct which should, under a modern Judicature Act system with merged availability of remedies, be seen as operating indifferently in both law and equity. It has, however, made me more conscious of the force of contrary views. It has also made me conscious of the inadequacy of what I wrote in earlier judgments.

"There is no evidence to shew that the plaintiff, up to a short time before bringing this action, ever complained that he had not received the notice which his counsel now insist was a condition precedent to a valid sale, or that the sale was invalid for any reason. On the contrary, he treated the sale as valid, but mistook the effect of it on his right to redeem. Their Lordships think that, in the absence of all explanation by the plaintiff other than that given in his evidence on discovery, the legitimate inference to be drawn is that he consented to dispense with this notice - that is, he waived it."

The basis of this decision seems to be that, at the meeting when it was decided that the Council would purchase the land if necessary, the plaintiff "had himself joined in" in conferring the power on the Council (at p 499). Accordingly, he waived his right to prior notice of the sale.

18. In Evans Pty. Ltd. v. Hawthorn (1967) VR 212, the Full Court of the Supreme Court of Victoria held that a municipality had waived its right to object that a notice of intention to appeal, given by an aggrieved ratepayer, was not in accordance with a section of the Local Government Act 1958 (Vict.). The Full Court said (at p 218) that the requirement of notice was intended to ensure that the municipality should not be taken by surprise. It was open to the municipality, however, to elect to proceed without the information which the notice must give.

19. In Bock v. Don-Rex Furniture (Qld) (1981) Qd R 326, relying on Wilson, Sheahan J. held that the Workers' Compensation Board had waived its right to insist on strict compliance by the plaintiff with a section of the Workers' Compensation Act 1916 (Q.). However, his Honour expressly found that the plaintiff suffered detriment which was a finding unnecessary to support a claim of waiver but essential to support a claim of estoppel.

20. The principle that statutory conditions enacted solely for the benefit of individuals and not for the public can be waived has also been recognised in this Court on a number of occasions: see Sandringham Corporation v. Rayment (1928) 40 CLR 510, at pp 527, 537; Davies v. Davies (1919) 26 CLR 348, at p 365; Brown v. The Queen (1986) 160 CLR 171, at pp 178, 208. In each of those cases, however, the defence of waiver failed on the facts or because the right was one enacted for the benefit of the public and not for the benefit of individuals.

21. In my opinion, the cases to which I have referred do not establish any principle which supports the claim of waiver in the present case. Ex parte Moore and Bock, and perhaps Phillips v. Martin and Wilson v. McIntosh, are really cases of estoppel. Indeed, in Kammins Co. v. Zenith Investments Lord Diplock thought that all cases of the type to which I have referred were better categorised as estoppel cases. His Lordship said (at pp 882-883):
"'Waiver' is a word which is sometimes used loosely to
describe a number of different legal grounds on which a person may be debarred from asserting a substantive right which he once possessed or from raising a particular defence to a claim against him which would otherwise be available to him. We are not concerned in the instant appeal with the first type of waiver. This arises in a situation where a person is entitled to alternative rights inconsistent with one another. If he has knowledge of the facts which give rise in law to these alternative rights and acts in a manner which is consistent only with his having chosen to rely on one of them, the law holds him to his choice even though he was unaware that this would be the legal consequence of what he did. He is sometimes said to have 'waived' the alternative right, as for instance a right to forfeit a lease or to rescind a contract of sale for wrongful repudiation or breach of condition; but this is better categorised as 'election' rather than as 'waiver'. It was this type of 'waiver' that Parker J. was discussing in Matthews v. Smallwood (1910) 1 Ch 777.

The second type of waiver which debars a person from raising a particular defence to a claim against him, arises when he either agrees with the claimant not to raise that particular defence or so conducts himself as to be estopped from raising it. This is the type of waiver which constitutes the exception to a prohibition such as that imposed by section 29(3) of the Landlord and Tenant Act, 1954, and other statutes of limitation. The ordinary principles of estoppel apply to it."

22. Some of the cases which debar "a person from raising a particular defence to a claim against him", however, stand outside the categories of election, contract and estoppel. They are sui generis. They are cases where a statute has conferred a right on A, subject to the fulfilment of a condition for the benefit of B, and B has waived the condition by taking the next step in the course of procedure without insisting on A fulfilling the condition. In my opinion, the true basis of the decisions in these cases is that, where the existence of a statutory right depends upon the fulfilment of a condition precedent, a person entitled to insist on the fulfilment of that condition may dispense with its compliance unless it is enacted for the benefit of the public, and that person will be held to have waived compliance with the condition if he or she knowingly takes or acquiesces in the taking of a subsequent step in the course of procedure laid down by the statute after the time for the other person to fulfil the condition has passed. These cases are also, to a certain extent, anomalous. They should be strictly confined so as not to conflict with the more established doctrines of election, contract and estoppel.

23. The present case, however, is far removed in nature and principle from the various cases which have given effect to the principle of waiving a statutory condition. Section 5 is not a condition precedent to the obtaining or maintaining of a statutory right by the plaintiff. Nor is the common law right of the plaintiff to sue the Commonwealth subject to the statutory condition that he commence his action within the period set by s.5 of the Limitation Act. There is, of course, a fundamental difference between a true statute of limitation, such as s.5, which bars stale claims and a limitation period annexed by a statute to a right which it creates. In the latter class of case, the limitation period will generally be of the essence of the right: see Australian Iron and Steel Ltd. v. Hoogland (1962) 108 CLR 471 at pp 488-489. It is not a condition precedent to the right but part of it. However, neither is a true statute of limitation a condition precedent to the right which it bars. It is a plea in confession and avoidance of that right and not a condition precedent to its exercise. Accordingly, the plaintiff's common law right to bring the present action was not subject to any condition precedent that it be exercised within the period specified by s.5 of the Limitation Act.

24. The deliberate act of the Commonwealth in not raising the Limitation Act or, if it matters, renouncing the defence based on that Act is not enough to attract the principle of waiver enshrined in the cases to which I have referred. That principle has nothing to say about a case where a party has done no more than consciously refuse to plead a defence or a cause of action. If, having decided not to plead a cause of action or defence, a party then seeks to amend his or her pleading before verdict, the right to amend will be governed by the principles expounded in such cases as Leotta v. Public Transport Commission (N.S.W.) (1976) 50 ALJR 666; 9 ALR 437 and Ketteman v. Hansel Properties (1987) AC 189. If the party seeks to raise the defence or cause of action after verdict, the right to amend will be governed by the principles expounded in cases such as Suttor v. Gundowda Pty. Ltd. (1950) 81 CLR 418 and Coulton v. Holcombe (1986) 162 CLR 1. In neither case, however, will the deliberate decision not to raise the point by itself be a fatal bar to the grant of a subsequent amendment or the right to raise the defence or cause of action, and this will be so even if the party seeking to amend had previously announced his or her intention not to raise the point. In Adams v. Chas. S. Watson Pty. Ltd. (1938) 60 CLR 545, this Court allowed a party to an appeal to raise a point which he had expressly conceded in the court below. Latham C.J. said, at p 548:

"The court is of the opinion that the objection should be overruled. It is entirely a question of law. I refer to George Hudson Ltd. v. Australian Timber Workers' Union ((1923) 32 CLR 413, at p 426), per Isaacs J., where he says: 'In Ex parte Markham ((1869) 34 JP 150) the Court of Queen's Bench (Cockburn, C.J. and Blackburn, Mellor and Lush JJ.) held that a fatal objection in law may be taken in the appellate court, though not noticed before the justices, the condition being that it could not be cured by further evidence.' The principles there expressed by Isaacs J. appear to apply completely to this case. As Mr Ashkanasy has said, it is a matter which may be taken into account in considering the question of costs, but that will depend upon the view which the court takes of the whole matter."

25. In Lang v. Australian Consolidated Press Ltd. (1970) 2 NSWR 408, the Court of Appeal of New South Wales held that a trial judge erred in leaving a defamatory imputation to the jury even though counsel for the defendant had conceded at the trial that the imputation was open to the jury to find. This Court refused special leave to appeal against the order of the Court of Appeal: (1970) 124 CLR 681.

26. Adams and Lang decide, therefore, that after verdict a party may raise a point that he has conceded in the court below. They deal with the conscious decision of counsel not to raise a point of law. It is difficult to see how they can be reconciled with the claim of "waiver" in the present case.

27. In the present case, the Supreme Court allowed the Commonwealth to amend its defence to plead the Limitation Act defence notwithstanding previous statements made on its behalf to the effect that the defence would not be pleaded. The facts relied on by the plaintiff in his reply of "waiver" provided no answer in point of law to that defence once it was raised. Consequently, the Supreme Court was correct in holding that the reply of "waiver" was no answer to the defence based on s.5 of the Limitation Act.

28. It necessarily follows from these reasons that the reply of "waiver" was also no answer to the defence based on "no duty of care".
Estoppel

29. The alternative ground upon which the plaintiff relied was that of estoppel. His counsel contended that common law and equitable estoppel are now unified. Reliance was placed on what was said by Mason C.J. in Foran v. Wight (1989) 64 ALJR 1 at p 12; 88 ALR 413 at p 430. See also Deane J. in Waltons, at pp 451-452. However, it is unnecessary to decide that point in this case: I do not think that the doctrine of common law estoppel advances the plaintiff's case any further than does the doctrine of equitable estoppel. Both common law and equity applied the principle of estoppel in pais. They both held that, if a person made a false representation to another about a past or present fact and the representee acted upon it, the representor was not allowed to assert the untruth of that representation: Jorden v. Money (1854) 5 HLC 185 at p 210 (10 ER 868 at p 880); Waltons, at pp 447-448. Accordingly, so far as any representation by the Commonwealth as to present or past facts is concerned, the common law doctrine of estoppel does not advance the plaintiff's case any further than the equitable doctrine does. But more importantly, in the present state of authority, the common law doctrine of estoppel does not, but the equitable doctrine of promissory estoppel does, extend to representations or assumptions concerning the future: Legione v. Hateley (1983) 152 CLR 406 at pp 432-435; Waltons at pp 398-399, 459. Hence any representations or assumptions concerning the future can be dealt with, and on the traditional view can be dealt with only, by equitable estoppel. Even if "there is no acceptable reason why the doctrine of promissory estoppel should be seen, in a fused system, as exclusively equitable", as Deane J. asserted in Waltons (at p 448), the equitable rules must prevail over the common law rules "concerning the same matter": Supreme Court Act 1986 (Vict.), s.29.

30. One important difference between the common law doctrine of estoppel in pais and the equitable doctrines of promissory and proprietary estoppel is that the common law doctrine is concerned with the rules of evidence, notwithstanding that a common law claim of estoppel must be pleaded, while the equitable doctrines are concerned with the creation of new rights between the parties. The common law will not permit "an unjust departure by a party from an assumption of fact which he has caused another party to adopt or accept for the purpose of their legal relations": Grundt v. Great Boulder Pty. Gold Mines Ltd. (1937) 59 CLR 641 at p 674. In so far as the assumed fact gives rise to a cause of action or alters the legal relationship between the parties, it does so because of the operation of the general law on the assumed fact either alone or in conjunction with other facts. Equity, like the common law, also will not permit an unjust departure from an assumption of fact which one person has caused another to adopt or accept for the purpose of their legal relations: Thompson v. Palmer (1933) 49 CLR 507 at p 547. But the equitable doctrines of estoppel create rights. They give rise to equities which are enforceable against the party estopped. The equitable doctrines result in new rights between the parties when it is unconscionable for a party to insist on his or her strict legal rights. It will be unconscionable for a party to insist on his or her strict legal rights if that party has induced the other party to assume that a different legal relationship exists or will exist between them, if he or she knew that the other party would act or refrain from acting on that assumption and if, as a result, the other party will suffer detriment unless the assumption is maintained. Hence, to avoid detriment to the party who has been induced to act or refrain from acting on that assumption, equity will require the parties to act on the basis of the relationship assumed by the innocent party until the detriment is removed or the innocent party otherwise compensated. The equitable right of the innocent party will take precedence over the strict legal rights of the party estopped. And because the doctrines of promissory and proprietary estoppel create equitable rights, they operate differently from the common law doctrine of estoppel in pais. The purpose of both the common law and equitable doctrines is "to avoid or prevent a detriment to the party asserting the estoppel by compelling the opposite party to adhere to the assumption upon which the former acted or abstained from acting": Grundt at p 674. But because the common law doctrine of estoppel in pais is a rule of evidence, it operates to preclude the party estopped from denying the assumption of fact whenever it is necessary to do so for the purpose of determining the rights of the parties. On the other hand, because the equitable doctrines create rights, they preclude the party estopped from denying the assumption of fact (or law) only as long as the equitable right exists. Once the detriment has ceased or been paid for, there is nothing unconscionable in a party insisting on reverting to his or her former relationship with the other party and enforcing his or her strict legal rights.

31. What will be required to satisfy the equity which arises against the party estopped depends on the circumstances: Waltons, per Mason C.J. and Wilson J. at p 404. Often the only way to prevent the promisee suffering detriment will be to enforce the promise. But the enforcement of promises is not the object of the doctrine of equitable estoppel. The enforcement of promises is the province of contract. Equitable estoppel is aimed at preventing unconscionable conduct and seeks to prevent detriment to the promisee. As Brennan J. pointed out in Waltons, "in moulding its decree, the court, as a court of conscience, goes no further than is necessary to prevent unconscionable conduct": at p 419. Consequently, a court of equity will only require the promise or assumption to be fulfilled if that is the only way in which the equity can be fulfilled: per Brennan J. at p 416. In Silovi Pty Ltd v. Barbaro (1988) 13 NSWLR 466 at p 472, Priestley J.A, writing for an unanimous Court of Appeal, said: "The remedy granted to satisfy the equity ... will be what is necessary to prevent detriment resulting from the unconscionable conduct."
The claim of estoppel fails

32. Despite the argument for the plaintiff to the contrary, I do not think that the present case involved any representation as to present or past facts. The Commonwealth did not represent that it had no right to plead the Limitation Act. At its highest what it did on 25 January 1985 and later was to represent that it would not plead the statute as a defence or take any steps in the future to amend its defence. If the plaintiff is to rely on estoppel, he must rely on promissory estoppel. In Waltons, Brennan J. set out (at pp 428-429) the matters which he thought a party must establish to prove a case of promissory estoppel. His Honour said:

"In my opinion, to establish an equitable estoppel, it is necessary for a plaintiff to prove that (1) the plaintiff assumed that a particular legal relationship then existed between the plaintiff and the defendant or expected that a particular legal relationship would exist between them and, in the latter case, that the defendant would not be free to withdraw from the expected legal relationship; (2) the defendant has induced the plaintiff to adopt that assumption or expectation; (3) the plaintiff acts or abstains from acting in reliance on the assumption or expectation; (4) the defendant knew or intended him to do so; (5) the plaintiff's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and (6) the defendant has failed to act to avoid that detriment whether by fulfilling the assumption or expectation or otherwise. For the purposes of the second element, a defendant who has not actively induced the plaintiff to adopt an assumption or expectation will nevertheless be held to have done so if the assumption or expectation can be fulfilled only by a transfer of the defendant's property, a diminution of his rights or an increase in his obligations and he, knowing that the plaintiff's reliance on the assumption or expectation may cause detriment to the plaintiff if it is not fulfilled, fails to deny to the plaintiff the correctness of the assumption or expectation on which the plaintiff is conducting his affairs."

33. For the purposes of the present case, I am content to adopt his Honour's analysis of the elements of equitable estoppel and I shall assume in favour of the plaintiff that the facts of this case establish the first requirement specified by his Honour. But even when that assumption is made in favour of the plaintiff, I do not think that he has made out a case of equitable estoppel.

(i) The "no duty" point

34. I do not think that it is possible to infer that the plaintiff was induced to continue his action and incur unnecessary costs or that he will otherwise suffer detriment by reason of the promise that the Commonwealth would admit liability. The terms of the statement of claim, which was issued before any assurance by the Commonwealth, and the course of events since the Commonwealth changed its mind suggest that the plaintiff would have commenced and continued his action even if the liability of the Commonwealth had been put in issue from the beginning. Moreover, there is no suggestion that the plaintiff has been prejudiced in the conduct of his case by the change of position on the part of Commonwealth. The claim of estoppel in respect of the defence of "no duty of care" must fail.

(ii) The Limitation Act point

35. In my opinion, the claim of estoppel in respect of the Limitation Act must also fail. Ordinarily, a statement that a party does not intend to rely on a particular defence will not give rise to an estoppel. One reason is that it is difficult for a party to rely on a voluntary and unilateral promise as giving rise to an estoppel "because the promisee may reasonably be expected to appreciate that he cannot safely rely upon it": Waltons, per Mason C.J. and Wilson J. at p 406. Another reason is that, if the representation is confined to the party's present intention, it cannot found a promissory estoppel unless the representation, expressly or implicitly, also makes it clear that that party does not intend to change his or her mind in the future: cf. Waltons, per Deane J. at p 450. A statement by a party that he or she does not intend to rely upon a particular cause of action or defence cannot be regarded as anything more than a statement of present intention. Pleadings may be amended, with the leave of the court, right up to verdict. Hence, ordinarily a party cannot reasonably rely on a statement that his or her opponent will not be relying on a particular defence or cause of action to found an estoppel. Still less can the filing of statement of claim or statement of defence which omits to raise a particular cause of action or ground of defence give rise to an estoppel. The present case, however, is exceptional. First, the statement was made against the background that, in the action brought by Mr Palmer, the Commonwealth had admitted liability and not sought to rely on the Limitation Act defence. Secondly, the statement of the Commonwealth on 25 January 1985 was made in answer to a request to "waive the Statute". The request was made before the plaintiff commenced his action. Thirdly, the Commonwealth confirmed the statement of 25 January by not pleading the Limitation Act and by not denying negligence. Fourthly, the Commonwealth joined in a number of applications for an expedited hearing of the issues after the defences were not raised. Finally, the Minister Assisting the Minister for Defence wrote to the plaintiff on 27 November 1985 pointing out that the Commonwealth "has admitted negligence and is not pressing the statutory limitation period as a defence". In these circumstances, the inevitable conclusion to be drawn is that, by 27 November 1985 at the latest, the Commonwealth was representing that it had no intention then or in the future of filing defences denying negligence or pleading the Limitation Act.

36. Accordingly, it is proper to infer that the plaintiff assumed from at least 27 November 1985 that his relationship with the Commonwealth as plaintiff and defendant was one in which no issue arose between them concerning the Limitation Act. I think that it is also proper to infer that the plaintiff continued his action, and incurred a liability for legal costs which he would not otherwise have incurred, because of the assurance which the Commonwealth gave concerning the Limitation Act, and that the Commonwealth knew of these matters. It follows, therefore, that, if the Commonwealth can rely on the Limitation Act to defeat the plaintiff's action, he will suffer detriment.

37. The plaintiff led no evidence of any particular detriment that he has suffered or will suffer by reason of being induced to alter his position as the result of the conduct of the Commonwealth. The only detriment that one can infer is that of unnecessarily incurring legal costs between the date of the assurance by the Commonwealth that it would not plead the statute and the date when the Commonwealth changed its policy. That detriment to the plaintiff can be avoided by an order for costs. It is possible that the plaintiff has suffered more worry and stress as the result of the assurance of the Commonwealth than he would otherwise have suffered if the Commonwealth had not given the assurance which it did. But the plaintiff led no evidence to this effect, and I do not think that it can be inferred. In any event, even if the plaintiff had sought to make out a case along these lines, his equity would be satisfied by an award of compensation for that additional worry and stress and would not require that the Commonwealth be estopped from relying on the Limitation Act. However, counsel for the plaintiff did not seek to make out any case for compensation on this basis. Nor did he seek an inquiry as to out-of-pocket costs and expenses as suggested by King J. He relied on estoppel as absolutely precluding the Commonwealth from relying on the Limitation Act. But, for the reasons I have given, such a claim cannot succeed. Any equity in favour of the plaintiff arising from the conduct of the Commonwealth can be satisfied by means less drastic than an order precluding the Commonwealth from relying on the Limitation Act.
Order

38. The appeal should be allowed, the order of the Full Court set aside and the order of O'Bryan J. restored.

Orders

Appeal dismissed with costs.