What is it to make a promise? What its conceptual ingredients? How do promises compare with other statements? How exactly do they relate to agreements or basic contract theory? These, broadly, are the major, if not quite the only, questions we shall here try to elucidate.

Companies depend upon loan finance as one of their major sources of capital. However, banks and other financial institutions involved in the business of lending money to companies generally ensure that their exposure to the risk of non-repayment is minimised by taking security over the debtor company's property. One particularly important type of security which is available when money is lent to a company is the floating charge.

The concept of legitimate expectation first stepped onto the English law stage eighteen years ago in Schmidt v. Secretary of State for Home Affairs. There Lord Denning said obiter that an alien who had been given leave to enter the United Kingdom for a limited period had a “legitimate expectation of being allowed to stay for the permitted time” and, hence, if that permission was “revoked before the time limit expires, [the alien] ought to be given an opportunity of making representations [to the Home Secretary]”. Since then “legitimate expectation” has played an important part in numerous decisions in both the United Kingdom and the Commonwealth (particularly Australasia).

Every so often the Appeal Committee of the House of Lords produces a decision that sets back the rational development of the criminal law for several years or decades.

Other courts do this too. But when the lords are at fault it is particularly disappointing: because they should be the élite of the judiciary; because they have the time to consider their decisions properly; because counsel who argue cases before them (having thrashed them out in two lower courts) should be unusually well-prepared; because the lords have the authority to overrule ill-considered decisions of the lower courts; and because their own pronouncements are (if things go wrong) especially hard to overturn. What makes these aberrational decisions particularly disconcerting is that the lords commonly show no appreciation of, and make no attempt to answer, the powerful arguments in the existing literature against the position they adopt.