Matthew, an entrepreneur, borrowed $2,000,000 from Elizabeth for his new business idea. The terms of the agreement were that the money would be repaid within 9 months at 12 per cent interest. As the business went downhill after 6 months, Matthew told Elizabeth that he would be unable to pay her the full amount. He offered to pay $1,500,000 by cheque immediately in full settlement of the debt. Elizabeth accepted.

Elizabeth subsequently claimed the balance of $500,000, plus the interest. Matthew claims that he should not have to pay any more because the doctrine of promissory estoppel operated to protect debtors such as himself from just this sort of problem.

Required:

Is Matthew correct here? Discuss using the IRAC method.