Cohen v. Cowles Media Company
Facts: The plaintiff was an associate of a gubernatorial candidate and he gave some info about the arrest of an opposing candidate for lieutenant governor to the reporters with the condition that his name will be kept secret. The reporters promised to keep his name secret but then the editors overruled and his identity was revealed. As a result, plaintiff was fired from his job. Procedure: The jury awarded $200,000 in compensatory damages to the plaintiff. The Supreme Court of Minnesota reversed. Issue: Can the defendant’s promise be enforced under d90? Holding: Yes Rationale: According to the court: “…the test is not whether the promise should be enforced to do justice, but whether enforcement is required to prevent an injustice.” The reporters testified that it was unfair on the part of the editors to reveal plaintiff’s name in the article. In the common practice of news media, the promises of confidentiality are performed. So the only way injustice can be avoided is to hold the defendants liable for the damages that were rendered to the plaintiff due to the broken promise.
Pop's Cones, Inc. v. Resorts International Hotel, Inc., 307 N.J. Super. 461, 704 A.2d 1321 (App. Div. 1998) A franchisee of a frozen yogurt store had numerous discussions with a hotel and casino operator about relocating the store to space available in the hotel. The franchisee was concerned about rental rates and the viability of the new location. In order to allay these concerns, a hotel executive vowed that the financial issues could be easily resolved, and offered to permit the franchisee to operate a vending cart in the hotel free of charge for a summer to test the traffic flow. At the end of the summer of 1994, the franchisee inquired about the status of a lease proposal given to the hotel and informed the hotel that it needed an answer so that it could give notice to its current landlord as to whether it would exercise a renewal option. The franchisee, now a prospective tenant, was told that a more senior hotel executive had to approve the deal, but that approval was highly likely and that the franchisee should not extend its current lease. In reliance on that advice, the franchisee did not renew its lease and, instead, placed all of its equipment in temporary storage, commenced site preparations, and hired an attorney. After four months of preliminary negotiation, accompanied by continuing assurances that everything would work out and that the store was wanted in the hotel, the franchisee received a letter from the hotel at the end of January, 1995 rejecting the offer to lease space. The franchisee tried to find new space to lease since its original space had been re-let, but was unable to reopen for another 18 months. It then sought damages against the hotel, alleging that it
detrimentally relied on assurances that it would be able to lease space in the hotel. The Law Division granted summary judgment against the franchisee. The Law Division found no clear and definite promise was made that could reasonably be relied on and no specificity regarding lease terms. The Appellate Court thought differently. It thought that the motion judge had viewed the franchisee's complaint as seeking enforcement of a lease not yet fully negotiated. Instead, the Appellate Court found that the franchisee was really asserting a claim of promissory estoppel, not breach of contract. The elements of promissory estoppel are: (1) a clear and definite promise; (2) made with the expectation of reliance thereon; (3) the promisee in fact reasonably relied on the promise; and (4) detriment of a definite and substantial nature was incurred in reliance on the promise. The Court found that the first requirement has been relaxed somewhat by courts when determining whether a prima facie case exists. It found particular favor with cases that address whether injustice can be avoided only by enforcement of the promise, a more equitable analysis than the rigid "clear and definite promise" standard. The Court then found that the hotel had instructed the franchisee not to renew its lease and indicated that the parties were 95% of the way toward having a final agreement. As a result, the franchisee relied to its detriment on the hotel's assurances. Whether its reliance was reasonable became a question for the jury. Consequently, the Appellate Division concluded that the prospective tenant presented a prima facie case of promissory estoppel sufficient to defeat summary judgment.
Goodman v. Dicker United States Court of Appeals, District of Columbia, 1948. 169 F.2d 684. Dawson, pp. 278-279 Facts: The defendants told the plaintiffs that they would be able to have a franchise selling radios. In reliance on this promise, the plaintiffs hired salesmen and tried to sell radios. However, the defendants changed their minds. The plaintiffs sued. Issue: Can the plaintiffs recover on promissory estoppel even though the franchise agreement, if performed, would have been “at will”? Rule: “[O]ne who acts to his detriment on the faith of conduct of the kind revealed here should be protected by estopping the party who has brought about the situation from alleging anything in opposition to the natural consequences of his own course of conduct.” Analysis: The court finds that the trial court was correct in awarding the plaintiffs damages based on how much they spent in reliance on having the franchise and being able to sell radios. The defendants, however, are found to be not liable for lost profits on an initial order of radios.
Conclusion: The judgment was affirmed.