Under the law of contract, a promise is generally not enforceable unless it is supported by consideration. However, the development of liability in contract for action induced by reliance upon a promise, despite the absence of common-law consideration normally required to bind a promisor. Under the doctrine of promissory estoppel a promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. A fundamental element of promissory estoppel, therefore, is the existence of a clear and definite promise which a promisor could reasonably have expected to induce reliance. Thus, a promisor is not liable to a promisee who has relied on a promise if, judged by an objective standard, he had no reason to expect any reliance at all.
Plaintiff former employee and her husband were employed by the defendant. She worked in the sales division and was considered one of the top producers in the relocation services industry. After reorganizing, the employer terminated her husband. Because she believed her husband was likely to seek employment with one of the employer's competitors, the former employee spoke to her supervisor who assured her that her employment would not be affected adversely. She was subsequently terminated, so she filed a claim for damages. Judgment was partially rendered in her favor on her promissory estoppel claim. The Supreme Court affirmed the trial court's judgment.
Did the employer make a clear, definite promise to the plaintiff constituting promissory estoppel?
The appellate court held the jury's findings that there was no breach of contract, but there was promissory estoppel. The promise did not need to be the functional equivalent of an offer to enter into a contract for it to support a claim of promissory estoppel. Consequently, the jury's finding that the employer did not make an offer to enter into a contract with the former employee was not inconsistent with its finding that the employer had promised her that her employment would not be affected adversely if her husband were to accept a position with a competitor. The jury reasonably could have found that the former employee would have left the employer if the supervisor had not assured her as he did.