Boutilier promised to pay Dalhousie $5000 in a campaign run by the university to raise funds to "improve the efficiency of the teaching, to construct new buildings and to otherwise keep pace with the growing need of its constituency" with terms of payment "as per letter from Mr. Boutilier". No letter ever followed and Boutilier fell on hard economic times and could not pay. He acknowledged that he still intended to pay, and would do so when he could afford to. He died, and Dalhousie claimed against his estate for the money. Dalhousie was successful at trial which was overturned on appeal.
- Is a gratuitous subscription promise sufficient to find a binding contract?
Appeal dismissed with costs.
Crocket, writing for the court, decides that this gratuitous promise did not receive any consideration, and therefore that it is not a binding agreement. Boutilier did not promise to pay the money for any specific reason; he was not getting a specific benefit out of it. Unless the promisor gets some specific benefit from a gratuitous promise, then there is no consideration. If he had donated money specifically for the construction of a certain new building this could be consideration; but no such purpose is found in this case and therefore there is no binding agreement.
Crocket also finds that estoppel does not apply here because it can only apply when a representation has been made in fact (so, when the promisor has partially performed his promise).
- A gratuitous promise does not have sufficient consideration to be considered a binding contract unless the money was given for a specific purpose which can be seen as of some benefit to the promisor.
- For estoppel to apply, the promisee must rely on actual actions of the promisor, not merely a statement that they will do something.