Stanford University Quasi Contracts and Promissory Estoppel DiscussionSchool

Stanford University

Question Description

I need support with this Business Law question so I can learn better.

Discuss the concept of a promise being considered consideration. If a company promises you a job and you quit your existing job and move to a new state for the job and then, prior to your first day, the company imposes a hiring freeze and cannot hire you, can you enforce the contract? Would the doctrine of promissory estoppel apply in this situation?

Just do response each posted # 1 to 3 down below only

Posted 1

Consideration in contract law is defined as legal value, bargained for, and/or given in exchange for an act or promise. A promise is a declaration or assurance that one will do a particular thing. We’ve learned that one must be careful what she promises another because promises can make one accountable for “noncontract obligations”!

Chapter nine of our text discusses quasi-contracts and promissory estoppel. These are concepts that cover noncontract situations. Quasi-contracts are intended to prevent unjust enrichment in situations where the receiving party knowingly received a benefit and it would be unjust for them not to pay for it. Similarly, a promissory estoppel is another concept that requires promises to be enforced even though no contract actually existed; when a promise creates reliance.

Hopefully I don’t find myself in the situation where a company offers me a job and then can’t hire me. Nonetheless, the doctrine of promissory estoppel would apply in that situation. The promisor (the company) should foresee that they are inducing reliance. Having quit my job and moved to a new state, I most certainly have relied upon their promise for employment. If the company could or would not hire me, injustice would be created. Although this doctrine traditionally applied to gifts, it has grown to include oral promises that would normally be required to be in writing.

Posted 2

When it comes to promises it depends on what is involved with the contract. There are so many variables to what a contract is negotiating, there is no right or wrong answer to whether a promise will be enough to prevent a contract from being revoked. Some contracts are so serious and could affect someone’s life if a promise is not kept. Therefore, it is so important to only get involved with a contract if your intent is 100% in the outcome of completing it. If you do not think a promise is going to be withheld, then you better not accept it. Some contracts are going to be a gamble, and some are like taking candy from a silly cat. Make sure that promise is legit, it may come back to bite you in the end (Langvardt, Barnes, Prenkert, McCorory, & Perry, 2019.

Also, with the promissory estoppel there is no guarantee a contract will get enforced. With the promissory estoppel it can prevent a revocation, but also depends on many variables going in the right direction in your favor. With something so serious as accepting an offer from a new employer, packing your bags, and moving elsewhere, I imagine the promissory estoppel would go your way to prevent a revocation. The offer is so professional and the side effects of a job contract getting revoked is going to be messy, there will be damages for the offeree, and they will need to be paid. The best advice is thinking more than twice, cross your fingers before you accept, and maybe have a few witnesses around when it is final. Good luck with those contracts and take them seriously (Langvardt, Barnes, Prenkert, McCorory, & Perry, 2019.

Posted 3

I think Promissory Estoppel would apply to this scenario and lead to an enforceable contract. Promissory Estoppel is where an offeree foreseeably and reasonably relies on an offer being held open and will suffer injustice if it is revoked. I think the offeree has been given clear consideration in the form of a promise to employ the offeree. The offeree relied on this new employment opportunity by moving states and incurring expenses to do so. The cost could be anything from selling a house to terminating a lease early as well as having to spend money to move all personal belongings to the new state. The offeree has no way to foresee there being a hiring freeze just prior to starting work. So once they rescind the offer claiming that the hiring freeze is to blame that doesn’t change the fact that the offeree has suffered an injustice and now must move all their belongings back to the previous state or find another job in the new city, which will potentially cost more money.

As an added injustice what if the offeree had already arranged a new living space and had to go back on that arrangement due to this sudden job loss. This could amount to further financial loss and more hardship considering there is no job to return to because the offeree has already resigned at the former place of employment. I think the courts would approach this with Promissory Estoppel and rule in favor of the offeree as long as the offeree can prove the offer was extended. This might be done by showing an email that states the job is waiting for the offeree and list a starting date. The one lesson I would say that could be learned from this is that you always get everything in writing with it comes to major life events like this. If there had been a contract in hand that showed the offer and the acceptance, then it would look even better for the offeree.