M Civ JI 130.01 Promissory Estoppel

The plaintiff claims that the defendant is liable to [ him / her / it ] based on promissory estoppel. To establish this claim, the plaintiff has the burden of proving:

(a) that the defendant made a promise to [ the plaintiff / *[ name of other person ] ] that was clear and definite.

(b) that when the promise was made, the defendant knew or should reasonably have expected that this promise would induce the plaintiff to [ take / refrain from ] some action.

(c) that the plaintiff did [ take / refrain from ] some action in reliance on the promise.

(d) that the plaintiff was damaged as a result of [ his / her / its ] reliance.

Your verdict will be for the plaintiff if the plaintiff has proved all of those elements.

Your verdict will be for the defendant if the plaintiff failed to prove any one of those elements.

Note on Use

*Insert the name of a promisee other than the plaintiff if applicable. A person other than the promisee has a cause of action for promissory estoppel if the promisor should reasonably have expected the third person to act or refrain from acting in reliance. First Security Savings Bank v Aitken, 226 Mich App 291, 312; 573 NW2d 307 (1997). However, if the promise has been fulfilled, the third person cannot maintain an action. Parkhurst Homes, Inc v McLaughlin, 187 Mich App 357; 466 NW2d 404 (1991).

These instructions are not applicable in cases involving a defense of equitable estoppel because the elements are different from the elements of a cause of action for damages based on promissory estoppel. Compare Huhtala v Travelers Ins Co, 401 Mich 118; 257 NW2d 640 (1977) (contracts statute of limitations applies to promissory estoppel action) with Cincinnati Ins Co v Citizens Ins Co, 454 Mich 263, 269–270; 562 NW2d 648 (1997) (equitable estoppel as waiver of defense of statute of limitations). In Huhtala, the court explained that equitable estoppel is essentially a doctrine of waiver and conduct that might not constitute a clear and definite promise can be sufficient to establish an estoppel; promissory estoppel does not establish waiver, but substitutes for consideration in a case where there are no mutual promises, and it enables the promisee to assert a claim against the promisor independent of any other claim he or she may have against the promisor. 401 Mich at 132, 133.

Comment

State Bank of Standish v Curry, 442 Mich 76; 500 NW2d 104 (1993); Huhtala.

Although promissory estoppel is traditionally viewed as an equitable doctrine in Michigan, the claim may be submitted to the jury where the remedy sought is money damages or other nonequitable relief. Ecco, Ltd v Balimoy Mfg Co, 179 Mich App 748; 446 NW2d 546 (1989).

Applicability of the doctrine of promissory estoppel is a mixed question of law and fact, and the trial court needs to determine as a matter of law whether it is proper to invoke the doctrine of promissory estoppel by making a threshold inquiry into the circumstances surrounding the making of the promise and the promisee’s reliance. Standish, 442 Mich at 84. Standish suggests that this threshold inquiry involves a determination that the doctrine must be invoked to avoid injustice. See RS Bennett & Co v Economy Mechanical Industries, Inc, 606 F2d 182 (CA 7, 1979), cited in Standish, 442 Mich at 85 n 6. Certainly the avoidance of injustice requirement of promissory estoppel is equitable in nature and presents a policy decision for the court, not a question of fact for the jury. Commentators have cited this as the majority view, and several courts in other jurisdictions have held that whether injustice can be avoided only by enforcement of the promise is a question of law for the court and is not submissible to the jury. See 4 Williston, Contracts §8:5 (4th ed); Hoffman v Red Owl Stores, Inc, 26 Wisc 2d 683; 133 NW2d 267 (1965); D & S Coal Co v USX Corp, 678 F Supp 1318 (ED Tenn, 1988), aff’d, 872 F2d 1024 (CA 6, 1989); Cohen v Cowles Media Co, 479 NW2d 387 (Minn, 1992); see also Taylor v First of America Bank-Wayne, 973 F2d 1284 (CA 6, 1992); contra Alaska v First National Bank, 629 P2d 78 (Ala, 1981) (question of law if reasonable minds do not differ).

Promissory estoppel is not available as a cause of action for a person who suffers an injury relying on an enforceable contract promise because the usual remedies for breach of contract apply. Promissory estoppel substitutes for consideration in a case where there are no mutual promises. Huhtala. Where the reliance claimed by the promisee is bargained-for and is performance required under a contract between the parties, the promisee must rely on contract remedies and cannot sue on a promissory estoppel theory. See General Aviation v Cessna Aircraft Co, 703 F Supp 637 (WD Mich, 1988), aff’d in part, rev’d in part on other grounds, 13 F3d 178 (CA 6, 1993); Paradata Computer Networks v Telebit Corp, 830 F Supp 1001 (ED Mich, 1993). Whether reliance is also performance under a contract is usually resolved by the court as a matter of law.

The measure of damages in an action based on promissory estoppel is what the plaintiff lost in relying on the defendant’s promise. Joerger v Gordon Food Service, 224 Mich App 167; 568 NW2d 365 (1997); see also Vogue v Shopping Centers, Inc (After Remand), 402 Mich 546; 266 NW2d 148 (1978)(lost profits recoverable); In re Estate of Timko, 51 Mich App 662; 215 NW2d 750 (1974) (voluntary unilateral promise to make charitable contribution; damages are what was promised).

History

M Civ JI 130.01 was added March 1999. Amended January 2020.