Baird Textile Holdings Ltd v Marks and Spencer Plc [2002] 1 All ER (Comm) 737

• Baird Textile Holdings (B) had supplied Marks and Spencer (M) for 30 years and when M cancelled its contract.

• It it sued for lost profits, claiming either that there was an implied term of reasonable notice of 3 years being given before terminating the contract, OR that M was prevented from cancelling the contract by estoppel. 

Andrew-Morrit VC

• The parties had expressly avoided a definite contract over the 30 years in which B had supplied M and there was insufficient certainty on which to found a contract e.g. uncertainty as to price and quantity.

• Estoppel does not create an enforceable right, but merely regulates the contract which has been entered into by making enforceable any waivers of rights that are conceded, conventions that are mutually assumed etc.

• Given that there is no contract here, neither can there be any estoppel. 

Mance LJ

• B tried to argue that conventional estoppel should at least allow them to imply “bare terms” by which the parties can be governed.

• However estoppel does not create a cause of action, and to create an obligation by estoppel here would be to create a contract by estoppel i.e. to replace consideration AND terms with estoppel.