Reference no: EM133149317

Question - Brad, a wealthy lawyer from St. Catharines undertook to contribute $4,000,000.00 to Brock University's capital campaign, payable in 4 annual instalments of $1,000,000.00. On the occasion when Brad made the pledge the President of the University stated that the University would now be able to undertake the construction of an additional building and continue with its application to establish an accredited law school. A picture of Brad and the University President was published in the local paper and on the University's website together with a news item about Brad's generous contribution to the campaign. One month later Brad asked if the University would name the new law school building after him. The President agreed and said the University would be honoured to call the new building "Brad Hall" in recognition of his pledge. One year later, following payment of the first instalment of the pledge and as construction was about to begin, the President contacted Brad and advised him that in accordance with the University's naming policy, the University had recently entered into an agreement with the law firm of Maloney & Maloney to name the new building, once completed, "Maloney Hall". Maloney & Maloney had agreed to pay $5,000,000.00 for the naming rights for a period of 20 years from the completion of the building. The President advised Brad that a lecture hall in the building would now be named after Brad. Brad advised the University that it had breached their agreement and he would not be making any further payment. Brad demanded the immediate return of the $1,000,000.00 he had paid. The University responded that it had hired architects and engineers, had closed off a parking lot, entered into a construction contract and commenced construction based on Brad's promise and would be commencing legal action against Brad for the balance of $3,000,000.00. The University claimed that the President was not authorized to agree to name the building "Brad Hall" and, in any event, the President's promise was not legally binding.

Discuss the application of the principles of consideration and injurious reliance/equitable estoppel to the facts of this case. Will the University or Brad succeed in the legal action? Is there additional information which might affect the result?