“The Supreme Court of Canada has set out the criteria as to what establishes estoppel by convention in Ryan v. Moore, 2005 SCC 38, [2005] 2 SCR 53. In paragraphs 53 and 54, the Court sets out how the forms of estoppel have been established in law. It quotes from Spencer Bower P.180 in para. 54 as follows:
An estoppel by convention, it is submitted, is an estoppel by representation of fact, a promissory estoppel or a proprietary estoppel, in which the relevant proposition is established, not by representation or promise by one party to another, but by mutual, express or implicit, assent. This form of estoppel is founded, not on a representation made by a representor and believed by a representee, but on an agreed statement of facts, or law, the truth of which has been assumed, by convention of the parties, as a basis of their relationship. When the parties have so acted in their relationship upon the agreed assumption that the given state of facts or law is to be accepted between them as true, that it would be unfair on one for the other to resile from the agreed assumption, then he will be entitled to relief against the other according to whether the estoppel is as to a matter of fact, or promissory, and/or proprietary.
The Court, then, in para. 59, said that the following criteria form the basis of the doctrine of estoppel by convention:
(1) The parties’ dealings must have been based on a shared assumption of fact or law: estoppel requires manifest representation by statement or conduct creating a mutual assumption. Nevertheless, estoppel can arise out of silence (impliedly).
(2) A party must have conducted itself, i.e. acted, in reliance on such shared assumption, its actions resulting in a change of its legal position.
(3) It must also be unjust or unfair to allow one of the parties to resile or depart from the common assumption. The party seeking to establish estoppel therefore has to prove that detriment will be suffered if the other party is allowed to resile from the assumption since there has been a change from the presumed position.
With respect to estoppel by representation, the Moving Parties rely on the Supreme Court of Canada’s decision in Canadian Superior Oil Ltd. v. Hambly, 1970 CanLII 3 (SCC), [1970] S.C.R. 932, [1970] S.C.J. No. 48, which set out in para. 19, the factors giving rise to estoppel. They are:
(1) A representation or conduct amounting to a representation intended to induce a course of conduct on the part the person to whom the presentation is made;
(2) An act or omission resulting from the representation, whether actual or by conduct, by the person to whom the representation is made;
(3) Detriment to such person as a consequence of the act of omission.
It is to be noted, however, that estoppel by representation cannot arise from silence unless a legal duty is owed by the representor to the representee to make the disclosure. See: Ryan v. Moore, 2005 SCC 38 at para. 76.”