promissory estoppel

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Related to promissory estoppel: Detrimental reliance, Equitable estoppel

Promissory Estoppel

In the law of contracts, the doctrine that provides that if a party changes his or her position substantially either by acting or forbearing from acting in reliance upon a gratuitous promise, then that party can enforce the promise although the essential elements of a contract are not present.

Certain elements must be established to invoke promissory estoppel. A promisor—one who makes a promise—makes a gratuitous promise that he should reasonably have expected to induce action or forbearance of a definite and substantial character on the part of the promisee—one to whom a promise has been made. The promisee justifiably relies on the promise. A substantial detriment—that is, an economic loss—ensues to the promisee from action or forbearance. Injustice can be avoided only by enforcing the promise.

A majority of courts apply the doctrine to any situation in which all of these elements are present. A minority, however, still restrict its applicability to one or more specific situations from which the doctrine emanated, such aswhen a donor promises to transfer real property as a gift and the donee spends money on the property in reliance on the promise.

With respect to the measure of recovery, it would be unfair to award the plaintiff the benefit of the bargain, as in the case of an express contract, since there is no bargain. In a majority of cases, however, injustice is avoided by awarding the plaintiff an amount consistent with the value of the promise. Other cases avoid injustice by awarding the plaintiff only an amount necessary to compensate her for the economic detriment actually suffered.

promissory estoppel

n. when a person makes a false statement to another and the listener relies on what was told to him/her in good faith and to his/her disadvantage. In order to see that justice is done a court will treat the statement as a promise, and in a trial the judge will preclude the maker of the statement from denying it. Thus, the legal inability of the person who made the false statement to deny it makes it an enforceable promise called "promissory estoppel," or an "equitable estoppel." Example: Bernie Blowhard tells Arthur Artist that Blowhard has a contract to make a movie and wants Artist to paint the background scenery in return for a percentage of the profits. Artist paints, and Blowhard then admits he needed the scenery to try to get a movie deal which fell through and there are no profits to share. Artist sues and the judge finds that Blowhard cannot deny a contract with Artist and gives Artist judgment for the value of his work. (See: estoppel)

promissory estoppel

References in periodicals archive ?
take down and thereby avoid a promissory estoppel claim.
England) in which promissory estoppel can never operate on its own to
In addition to promissory estoppel and mutual rescission and replacement, a third exception to the requirement for consideration can be found in the unique case of Robichaud v Caisse populaire de Pokemouche Ltee, (42) about part payment, which is a specific variation of the pre-existing duty rule in which a promisor promises to take less and then relies on an absence of consideration to escape the promise on which the promisee had relied.
The Economics of Promissory Estoppel in Preliminary Negotiations, 105 YALE L.
The court then noted that it had referenced the elements of promissory estoppel in Quake Construction, Inc v American Airlines, Inc, 141 Ill 2d 281, 309-10, 565 NE2d 990, 1004 (1990), as well as in earlier cases dating back as far as the 19th century.
is correct, and I think he is, the limitation placed on promissory estoppel by Combe v.
The court observed that the doctrine of promissory estoppel can be applicable to oral at-will employment agreements.
Microbix' suit alleged not only antitrust violations but misrepresentation, promissory estoppel, breach of contract and interference with economic relationships.
13) Thus, the court accepted two forms of virtual adoption -- either an express contract for adoption or a promissory estoppel in relation to the child.
Employees may try to prove the employer committed a breach of contract, based on the doctrine of promissory estoppel, breaking a promise that harmed the employee.
The purpose of this Article is to examine the doctrine of promissory estoppel, as it applies in the context of preliminary negotiations, from the viewpoint of the economic theory of rational choice.