Promissory Estoppel - Requirements and Limitations of The Doctrine

University of Pennsylvania
Law Review
FOUNDED 1852
Formerly
American Law Register

VOL. 98
MARCH,
1950
No. 4
PROMISSORY ESTOPPEL: REQUIREMENTS AND

LIMITATIONS OF THE DOCTRINE
By BENJAMiN F. BoYER t
Promissory estoppel, as a contracts doctrine has been expressly
acknowledged for less than thirty years. First formulated in 1920, by
Samuel Williston,' the doctrine was included as Section 90 in the
Restatement of Contracts, published twelve years later.2 In the sixteen
years between the publication of the Contracts Restatement and 1948,
Section 90 was cited at least seventy-four times by American courts.'
From a consideration of these facts alone, one can well determine
that promissory estoppel merits further discussion and study, for it is
playing an important role in the development of present day contract
law.
As a generalization or principle, promissory estoppel may be
most readily studied for its present requirements, as well as its limitations, by an examination of what appear to be its constitutive elements.
For such a study one should, at least in the beginning, accept as
correct the statement of the doctrine as it is found in the Restatement
of Contracts.4 A study of this statement indicates that the doctrine's
t*Dean and Professor of Law, Temple University School of Law.
1. The writer has made a careful search to discover the pioneer in the use of the
term "promissory estoppel." A1parently the term was first used in I WILLISTON,
CONTRAcTS 139 (1st ed. 1920). See Note, 13 IowA L. REv. 332, 333 (1928).
2. RESTATEMENT, CONTRACTS (1932) (hereafter cited as RESTATEMENT). As is
well known, Mr. Williston served as Reporter for the Restatement of Contracts and
prepared the Commentaries on it, AMERICAN LAW INSTITuTE, COMMENTARIES ON
CONTRACTS (1926). The Commentary on Restatement No. 2, pp. 14-20, contains Mr.
Williston's rationale for what was then 88 and is now 90 of the Restatement of
Contracts. For discussion of promissory estoppel at Fourth Annual Meeting of American Law Institute, see 4 PROcEEDINGS A.L.I. 85-114 (1926).
3. RESTATEMENT IN THE CouRTs 367-371 (Permanent edition, 1932-44) gives
60 instances of court citation and 28 periodical references to the promissory estoppel
doctrine as set out in 90. A.L.I. RESTATEMENT OF THE LAW 196-199 (Supp. 1948)
includes reference to 14 judicial decisions citing the same section.
4. RESTATEMENT 90 (Promise reasonably inducing definite and substantial
action): "A promise which the promisor should reasonably expect to induce action
or forbearance of a definite and substantial character on the part of the promisee and
which does induce such action or forbearance is binding if injustice can be avoided
only by enforcement of the promise."
(459)
460
UNIVERSITY OF PENNSYLVANIA LAW REVIEW
elements number three.

in this wise:
They can be phrased as separate questions
(1) Was there a promise which the promisor should reasonably

expect to induce action or forbearance of a definite and substantial
character on the part of the promisee?
(2) Did the promise induce such action or forbearance?
(3) Can injustice be avoided only by enforcement of the
promise?
Thus stated, it becomes apparent that at least a threefold study
is necessary to determine the requirements and limitations of the
present-day doctrine of promissory estoppel. To make such a study
is the purpose of this paper-which will consider in detail each of the
three questions asked above and submit generalizations to be drawn
from such an examination. It is hoped that the end result will be to
make the doctrine more understandable and useful, for these generalizations can then be more readily applied to variant fact situations
which require solution. Thus, too, some conclusions may be reached
as to the future development which is likely to occur, or which should
occur, in the proper application of the doctrine.
A word should be added, perhaps, on the definition of the terms
used in this paper. "Contract" has been given varying meanings by
those who have discussed the term. It has been used to express the
following: (1) the acts which create legal relations between parties,
(2) the physical writing containing the terms of an agreement, and
(3) the legal relations resulting from operative facts.5 Here it means
"a promise that is directly or indirectly enforceable at law."' With
such a definition of contract, one must also define "promise." That
term is used here, as it is used in the Restatement of Contracts, as
meaning "an undertaking, however expressed, either that something7
shall happen, or that something shall not happen, in the future."
5. RESTATEMENT 1, Comment c; ANSON, CONTRACrS 13, note 2 (Corbin ed.
1930) (hereafter cited as CoRmIN's ANSON) ; SHEPHERD, CASES AND MATERIALS ON
CONTRACTS (2d ed. 1946); see Llewellyn, What Price Contract?, 40 YALE LJ. 704,
708 (1931) for other definitions.

6. CoRBIN's ANSON 13, note 2; a similar definition is found in RESTATEMENT 1:
"A contract is a promise or a set of promises for the breach of which the law gives
a remedy, or the performance of which the law in some way recognizes as a duty."
Accord, WILLISTON, CONTRAcTS 1 (Rev. ed. 1937) (hereafter cited as WILLISTON).
7. RESTATEMENT 2(1). It is to be noted that "undertaking" is ambiguous, for
it may indicate physical activity as 'well as the act of agreeing or expressing
Normally one might well incline to the adoption of Corbin's definition of a promise
as "an expression leading another person justifiably to expect certain conduct on the
part of the promisor." CORBIN'S ANSON 7, note 1. His definition, however, by its
use of the words "justifiably to expect" assumes the very factors which must be discussed fully in any consideration of promissory estoppel.
PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS
461
PROMISE LIKELY To INDUCE ACTION

Detailed consideration of the requirements and limitations of
promissory estoppel may well begin with an examination and analysis
of the first of the three questions asked above-"Was there a promise
which the promisor should reasonably expect to induce action or
forbearance of a definite and substantial nature on the part of the
promisee?"
If one begins thus, he will realize that he must first determine

whether the words involved constitute a promise, as distinguished,
for example, from an expression of good will or of anger or jest.8
If the words fall in the latter category, there will be no need to pursue
the inquiry further for it is clear that there will be no contractual
liability. 9 But if there is a promise, one must then examine it further.
In doing so, it will be observed that whether that promise is of such
a nature that the promisor should reasonably expect it to induce some
action or forbearance by the promisee is to be regarded from the
viewpoint of the promisor. Hence, one seeking to apply the doctrine
must test the promise in the light of all of the circumstances as they
were known to the promisor. Once those circumstances are understood, the next step is to determine whether a reasonable man,
acquainted with these circumstances, should have expected this
promise to induce action by the promisee.
FORESEEABILITY
It must be noted at the outset that the use of the words "promisor
should reasonably expect" makes the test of foreseeability an objective
one. Therefore, situations may occur in which a promisor will be
bound although he did not in fact foresee reliance. When this happens
a very real hardship, financial or otherwise, may be imposed on the
promisor. But this hardship is unavoidable if the promisee, who was
reasonably induced to act in reliance on the promise, is to be protected. Hardship to the promisor, if there is enforcement, and to the
promisee, if enforcement is denied, seems to create a dilemma. The
solution to the dilemma, if there be one, is in testing the promise by
an objective standard to determine whether or not the promisor
8. 4 PROCEEDINGS A.L.I., App. 108-9 (1926).
9. WILLISTON 21; GRIsmoRF, PRINCIPLES OF THE LAv OF CONTRACTS (hereafter
cited as GRIsmoRE) 19 (1947); CORIN's ANSON 4 and 54, note I; Keller v.
Holderman, 11 Mich. 248 (1863); McClurg v. Terry, 21 N.J. Eq. 225 (1870); Higgins v. Lessig, 49 III. App. 459 (1893) ; Richard's Ex'rs v. Richards, 36 Pa. 78, 82
(1863); "Assurances of assistance accompanying kind advice are never intended as contracts.
And conformance to advice is never intended to stand as legal consideration
for the kind assurances that accompany the advice, though it is a motive for their fulfillment."
462
should have foreseen action by the promisee, in the light of all the
facts and circumstances as they were then known to him. And the
decision is not controlled by what the promisor actually did foresee.
In this respect the test is the same one that is applied to determine
contractual liability in commercial transactions.1"
As Fuller and Perdue have pointed out, the use of the "reasonable
man" standard does at least two things: it enhances the likelihood
that a jury will ultimately decide the question of liability and, secondly,
it creates "a bias in favor of exempting normal or average conduct
from legal penalties."' 1 There is a corresponding tendency on the
part of the jury to impose liability for abnormal or unreasonable
conduct. The courts, however, have provided themselves with a
control over the assessment of damages by the jury in the "rule of
Hadley v. Baxendale.""2 Under this rule damages for breach of
contract "can be recovered only for such losses as were reasonably
foreseeable, when the contract was made, by the party to be
charged."' 3 As thus formulated, the rule prohibits the allowance of
damages in excess of those which the "contract breaker" reasonably
should have foreseen as likely to result from non-performance if he
had given any thought to such a contingency at the time he made the
agreement. Thus the rule can be said to diminish the risk of business
enterprise.
Whether it is proper to apply such a limitation in the case of
gratuitous promises may be questioned. It may be argued that the
gratuitous promise plays no part in business transactions which
normally involve bargain and exchange. The controls employed in
commercial transactions should not apply. Therefore, any and all
resulting loss by the promisee should be recoverable, not just those
losses which reasonably should have been foreseen. On the other
hand, it may be argued that there is no reason to apply different
limitations to gratuitous promises than to those which are purchased
for a price. The reasonable man test as to the foreseeability of
resultant actions can work equally well with both types of promises.
In addition, the requirement of foreseeability affords a justifiable
protection to the promisor. It applies the pragmatic test of a weighing
of the consequences of the actions 4 and words of the promisor and
10. Williston, Mutual Assent in the Formation of Contracts, 14 I.L. L. REv. 85
(1919), reprinted in SELECTED READINGS OF THE LAW OF CONTRACTS 119 (1931).
11. Fuller and Perdue, The Reliance Element in Contract Damages: 1, 46 YALE
L.J. 52, 86 (1936).
12. 9 Ex. 341 (1854).
13. McCoRMICK, DAMAGES 138 (1935).
14. In at least one case the court was willing to enforce a promise which it said
might be implied, from the defendant-intervenor's conduct, as a promise to abandon
any title he might have in an "undistinguishable portion" of a herd of cattle, some of
463
makes him responsible only for those consequences which he should

take into account in advance of the event.' 5 It would appear that
those who drafted Section 90 of the Contracts Restatement inclined
to the latter view when they described the gratuitous promise which
would be enforced as one which "the promisor should reasonably
expect to induce action or forbearance" by the promisee. By thus
incorporating the element of foreseeability in the doctrine, a limitation
is provided which tends to afford protection to the promisor, as well
as the promisee.
What action should reasonably be expected to follow from the
promise will of course depend on all the facts and circumstances and
on the meaning which the party making the statement "should
reasonably expect the other party would give to them."' 6 For
example, where the seller of an automobile under a conditional sales
contract repossesses the car for default in payment and then gratuitously promises the purchaser that the car will be retained for thirty
days and may be reclaimed within that period on making the payments due but in default, the court held that the promise was calculated to and in fact did induce the purchaser to take action to raise
the amount of the defaulted payments and that the promise was
binding." On the other hand, when the statements said to have
been relied upon were made by a sales manager as a part of a "pep
talk" to discouraged dealers during the depression and were to the
general effect that "dealers would get their losses back" and would
"receive financial assistance from the company," such statements
were construed as not to be a promise to the dealers by the company
to surrender its right, under an existing contract to cancel the dealer's
franchise without cause.' 8 Here are two illustrations which run the
gamut from idle talk to serious promises. They indicate the range
which were mortgaged to plaintiff. Hanna State and Savings Bank v. Matson, 53
Wyo. 1, 77 P.2d 621, 623 (1938). While the owner of property may often lose title
by standing by and permitting others to deal with it as their own, this case is unusual
in that the court does not rely on such holdings as the basis for decision. It is willing
to rest the decision on the doctrine of promissory estoppel.
15. This also seems to be the test adopted for tort liability by Cardozo, C.J., in
Palsgraf v. Long Island R. Co., 248 N.Y. 339, 162 N.E. 99 (1928).
16. RESTr~TEMENT 233. This is the standard of interpretation applicable to unintegrated agreements and is similar to the fifth standard mentioned in the Comment
to 227 of the RESTATMzENT.
17. Brewer v. Universal Credit Co., 191 Miss. 183, 192 So. 902 (1940).
18. General Electric Co. v. N. K. Ovalle, Inc., 335 Pa. 439, 445, 6 A.2d 835, 838
(1939) (The statements could give rise to a promissory estoppel "only if they clearly
expressed an intention on the part of the plaintiff to abandon the right of cancellation
so that plaintiff should reasonably have expected that they would be so construed by
the distributors and relied upon accordingly . . . In our opinion the statements
will not reasonably bear any such construction . . . It is inconceivable that the distributors could have seriously thought that the statements of the plaintiff's representatives were so intended .
").
464
of problems which may arise but they furnish no basis for holding
that the standards of interpretation applicable to conventional contract
situations should not ordinarily also apply to promissory estoppel.
The most common application of the doctrine of promissory
estoppel has been in the charitable subscription cases. The courts
have commonly felt that a person promising to contribute funds to
a charity, for example for the construction of a new building, should
expect the work to proceed in reliance upon the faithful payment of
subscriptions. 9 When it does, courts usually enforce his promise.20
Is it also to be expected that the person to whom land is promised
gratuitously and orally will spend a sizeable sum in making valuable
improvements on that land? Certainly, if the donee is told that he
is being given the land as a place for a home, the promisor should
expect it to be treated as such and it is typical for improvements
to be made on real estate so held."'
Sometimes the promisor should expect his promise to cause a
change in the economic activities of the promisee. When the promise
is to employ a man for ten years and the promisee resigns from the
police force, thereby forfeiting his pension ;22 or when a granddaughter resigns a position when told by her grandfather that none
of his grandchildren have to work and she will not either because
he is giving her enough money (i.e., his promissory note) to live
on ;21 these actions clearly were foreseeable. Indeed, these precise
acts by the promisees were to be expected if they were to enjoy the
fruits of the promise. So it is when the promisor tells a committee
to go ahead with a banquet, that he will pay his share later,2 4 or in
a meeting of subscribers in Civil War days says that he will contribute
to a fund to procure substitutes for drafted men.2 5 If the holder of
a gratuitous option makes an "expensive" examination and survey
19. Christian College v. Hendley, 49 Cal. 347 (1874) (After $14,000 was subscribed, contracts totalling $19,000 were let. Judgment for plaintiff reversed because
suit was brought by wrong party).
20. Trustees of Bridgewater Academy v. Gilbery, 19 Mass. 578 (1824) (letting
contract) ; University of Southern California v. Bryson, 103 Cal. App. 39, 283 Pac.
949 (1930) (beginning work is enough) ; It re Stack's Estate, 164 Minn. 57, 204 N.W.
546 (1925) (adding to buildings) ; Ryerss v. Trustees, 33 Pa. 114 (1859) (completing building); Owenly v. Georgia Baptist Assembly, 137 Ga. 698, 73 S.E. 56 (1912)
(locating a college).
21. Greiner v. Greiner, 131 Kans. 760, 293 Pac. 759 (1930) (donor required to
execute conveyance where donee had "moved on tract and made valuable improvements" in reliance on the parol gift). The court expressly adopted 90 of the RESTATEMENT as the reason for its decision.
22. Seymour v. Oelrichs, 156 Cal. 782, 106 Pac. 88 (1909) (a statute of frauds
case in which reliance on the promise was held to estop offeror; reversed on other
grounds).
23. Ricketts v. Scothorn, 57 Neb. 51, 77 N.W. 365 (1898).
24. Lasar v. Johnson, 125 Cal. 549, 58 Pac. 161 (1899).
25. McClure v. Wilson, 45 III. 356 (1867).
465
of lands preliminary to acceptance of an offer,2" or if the consignor

of the contents of a freight car stands by in reliance on the gratuitous
pronise of the railroad's agent that the car will be delivered to a
connecting road,7 a court could say that the action and the forbearance were to be expected.
But, while it may appear proper to bind the promisor when he
should reasonably expect the promisee to take action of a definite
and substantial nature, what of those instances where the action is
taken by others than the promisee? Should the fact that the promise
induced others to subscribe to a charity be a reason for holding the
promisor to his promise? The action or forbearance which results
in legal consequences for the promise should be the action or forbearance of the promisee, for he is the person to whom the promise
is made. It asks too much of a promisor to require that he consider
whether or not his promise will induce action by a third party. Yet
some courts have seen fit to enforce gratuitous promises because they
were considered to have induced the making of similar promises by
other subscribers to a charity, 28 or even because signing the subscription may have induced others to subscribe. Such decisions are
bolstered by saying that if the promisor is permitted to withdraw,
it "may be a fraud upon" the others. 9 Such a view seems to be
erroneous. Promises are not made to the whole world, they are
directed to specific individuals. Where an offer is concerned, contractual liability is imposed only if there is an acceptance "by or for
There is no reason to treat the
the person to whom it is made."'
promissory estoppel cases differently. The other subscribers to a
charity are not defrauded when the promisee is not held; there has
been no misrepresentation of fact made to them. To hold a promisor
because third parties have or may have changed position in reliance
on his promise runs counter to the general trend of promissory
obligations. The Restatement expressly limits the doctrine to action
or forbearance on the part of the promisee. 8 The limitation is a
sound one for it tends to keep promissory estoppel within justifiable
limits.
26. Wilson v. Slpry. 145 Ark. 21, 223 S.W. 564 (1920). Contra: Bancroft v.
Martin, 144 Miss. 384, 109 So. 859 (1926).
27. Melbourne & Troy v. Louisville and N.R.R., 88 Ala. 443, 6 So. 762 (1889).
28. Somers v. Miner, 9 Conn. 458 (1833) ; Robertson v. March, 4 Ill. 198 (1841);
Brokaw v. McElroy, 162 Iowa 288, 143 N.W. 1087 (1913); Comstock v. Howd, 15
Mich. 237 (1867).
29. Snell v. Trustees, 58 Ill. 290 (1871) ; George v. Harris, 4 N.H. 533 (1829).
30. RESTATEMENT 54; WMLIsToN 80; GlusmoRE 38; CoRIN'S ANsoN 184;
Boulton v. Jones, 2 H. & N. 564 (1857) ; Boston Ice Co. v. Potter, 123 Mass. 28
(1877).
31. RESTATEMENT
90
(".
action or forbearance of a definite and substantial
nature on the part of the promisee . .
").
466
TERMINATION OF PROMISEE'S POWER TO BIND PROMISOR
It is hornbook law that an offer may be revoked by the offeror

and that (save in the exceptional case) the offeree may not thereafter accept so as to create contract liability.3" Should a different rule
apply in cases of promissory estoppel? If the promise be considered
as analogous to an offer, it would seem that revocation communicated
before definite and substantial action in reliance upon it should be
effective. The cases so hold.33 At least one court, though, has been
reluctant to permit revocation. In Snell v. Trustees, 4 before any
work of remodeling a church was begun the subscriber said he
"wouldn't pay unless X never spoke in the church." Here there
would seem to be the creation of a condition intended to affect the
force of the promise. The court nevertheless allowed recovery saying,
"We do not think the defendant's notice of withdrawal of his subscription was sufficient to exonerate him from liability to pay it. The
course of his action was so groundless and capricious a character"
that his subscription would be enforced. The view permitting revocation is to be preferred. After notice of revocation or modification
the promisee cannot justly contend that any action thereafter was
taken because of the promise. Likewise, after notice of intent to
revoke, the promisor may well claim that no person in his position
would thereafter "reasonably expect" any action or forbearance by
the promisee because of the promise.
There should be, however, reasonable limitations on the power
of the promisor to revoke. He should be required to act within a
reasonable time after giving his promise, if he desires to use revoca6
tion as a defense, 33 and at least before action taken by the promisee.
And, to be consistent, the same rules which apply to the acceptance
Exceptions are described in 45-47. GRisRESTATEMENT 35(1) (e), 41.
30, 32; WILLISTON 50A, 55.
33. Augustine v. Trustees of Methodist Episcopal Society, 79 Ill. App. 452 (1898)
(defendant withdrew subscription for church remodeling after congregation had voted
to change projected repairs and before any actual work had been done) ; George v.
Harris, 4 N.H. 533, 536 (1829) (dictun: He can escape liability "only by showing
that before anything was done he notified the other subscribers that he withdrew.") ;
Sherwin v. Fletcher, 168 Mass. 413, 47 N.E. 197 (1897) (dictum) ; Williams v. Rogan,
59 Tex. 438 (1883) ; Rogers v. Galloway Female College, 63 Ark. 627, 44 S.W. 454
(1898).
34. 58 IIl. 290 (1871).
35. Missouri Wesleyan College v. Shulte, 346 Mo. 628, 142 S.W.2d 644 (1940)
(attempted revocation after 17 years comes too late) ; Barnes v. Perrine, 12 N.Y. 18,
23 (1854) (attempted revocation long after expenses had been incurred and work
done).
36. Note, 17 Ann. Cas. 1076 (1910) ."In determining whether a subscription is
legally enforcible the courts have uniformly held that the subscription becomes irrevocable and enforcible when work is done or liabilities or expenses incurred on the faith
of it and in pursuance of the object for which it was made." Missouri Wesleyan College v. Shulte, 346 Mo. 628, 639, 142 S.W.2d 644, 651 (1940).
32.
MoRE
PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS 467
of offers of unilateral contracts requiring time for performance" 7

should also control in the application of the doctrine of promissory
estoppel.3" Once substantial action on the promise has begun, the
promisor loses the power to withdraw the promise.
An even more interesting proposition is involved in cases where
the promisor dies or becomes insane after making a promise of the
character under examination here. Should the death or insanity
prevent enforcement? The question illustrates the need for ready
recognition of the general principles which should apply to the solution
of any problems which arise in the application of the doctrine of
promissory estoppel. The doctrine is framed with reference to contractual obligation. Indeed, it has even been referred to as "the safety
Being so framed and
valve for the subject of consideration."3
described, it seems but logical to apply it in accordance with the
principles generally applicable to any contracts problem. Let us, then,
consider the effect of the death or insanity of the promisor in the
light of those principles.
If a promise to make a gift to a charity is regarded as an offer,
then the cases dealing generally with the effect of death on an offer
will be in point. It was at one time thought that it was not possible
to create a contract where either party died before an acceptance
evidencing mutual assent to the creation of a contract had been given.
Under such a theory, death of the offeror (whether known to the
offeree or not) terminated the offer and the offeree's power to accept
it. It is generally held, even today, that the death or insanity of the
offeror terminates his offer.4" It is here that the "will theory" of
contractual liability still survives, for such a holding clearly exemplifies
the subjective theory of mutual assent which that theory embodied.
However, strong arguments have been made to the effect that notice
of the offeror's death should be required to terminate an offer since,
until notice, the offeree has the apparent opportunity to accept.4 1
37. RESTATEMENT 45; WILLISTON 60A.
38. The following cases so indicate: Wilson v. First Presbyterian Church, 56 Ga.
554 (1876); Rouff v. Washington and Lee University, 48 S.W.2d 483 (Tex. Civ.
App., 1932) ; Watkins, Treasurer v. Eames, 63 Mass. 537 (1852).
39. Williston so described it at the Fourth Annual Meeting of the American Law
institute. 7 PROCEEDINGS A.L.I., App. 86 (1926).
40. RESTATEMENT 48; WILLISTON 62; GRISMOPE 34; CORBIN'S ANSON 44;
Pratt v. Trustees of Baptist Society, 93 Ill. 475 (1879) ; Ritchie v. Rawlings, 106 Kans.
118, 186 Pac. 1033 (1920).
41. Ferson, Does the Death of an Offeror Nullify His Offer? 10
MINN.
L.
REv.
373 (1926), reprinted in SELECTED READINGS ON THE LAW OF CONTRACTS 275, 281
(1931) ("The death of the offeror should not--on the grounds of either expediency or
logic-revoke the offer, as long as the offeree is unaware of the death . . . Whether
an acceptance, completing the contract, is possible in the particular case would depend
on whether it involves the existence of the offeror."). Compare Parks, Indirect Revocation and Termination of Offers by Death, 19 MIcH. L. REv. 152 (1920) ; Parks,
Attempted Acceptance of a Deceased Offeror's Offer, 40 Mo. L. BULL. 5 (1928).
468
A number of cases hold that the death of the subscriber to a

charity, before the charity has acted in reliance on his gratuitous
promise, terminates the charity's power to create promissory liability.4 2
The same result has been reached where the promisor becomes
insane.4 3 A rigid adherence to the subjective theory would require
refusal to enforce a subscription where the charity had begun, but
not completed, the work for which it sought the subscription. Yet
there are a number of cases which enforce the promise despite lack
of completion of the project." This modification of subjective
doctrine is desirable. Since reliance plays such a large part in the
justification of promissory estoppel it would seem proper to protect
that reliance, even, if necessary, by a resort to the theory now
employed in cases of offers for unilateral contracts requiring time
in performance,45 as these cases seem to do.
If the promisee knows of the death or other incapacity of the
promisor before any action is taken on the strength of the promise,
it seems proper to deny recovery when he seeks to enforce a liability
based on promissory estoppel. This is the rule now applied in cases
of offers. 4' The promisee should not be privileged to believe, in the
usual case, that the promisor intended to confer on the promisee the
power to bind his estate. But, if the promisee has acted in reliance
42. Grand Lodge v. Farnham, 70 Cal. 158, 160, 11 Pac. 592, 593 (1886) ("Here
it is not alleged in the complaint that the plaintiff entered any contract, incurred any
liability, or expended any money before the death of Farnham. His subscription was
therefore withdrawn."); Pratt v. Trustees of the Baptist Society, 93 Ill. 475, 478
(1889) ("the death of the promisor before the offer is acted upon, is a revocation of
the offer."); Helfenstein's Estate, 77 Pa. 328 (1875); Reimensnyder, Admr. v.
Gans, 110 Pa. 17, 2 Atl. 425 (1885); Twenty-third St. Baptist Church v. Cornwell
et al., 117 N.Y. 601, 23 N.E. 177 (1890) ; First Cong. Church v. Gillis, 17 Pa. Co. Ct.
614 (1895) ; Patchen's Estate, 22 Pa. Dist. 56, 57 (1913) ; First Trust & Say. Bank
v. Coe College, 8 Cal.App.2d 195, 47 P.2d 481 (1935) (dictum).
43. Beach v. First Methodist Church, 96 Ill. 177, 179 (1880) (subscriber adjudged
insane in 1875, construction of church begun in 1876, "There is nothing in the record tending to show that the church took any action upon the faith of this subscription
until after Doctor Beech was adjudged insane . . . His insanity, by operation of
law, was a revocation of the offer.").
44. Baptist Female University v. Borden, 132 N.C. 476, 44 S.E. 47, 1007 (1903)
(subscriber died one month after signing; University had "incurred liabilities" to
soliciting agents); First M.E. Church v. Howard, 133 Misc. 723, 233 N.Y.S.
451 (Surr. Ct., 1929) (Subscription signed in 1920, architect hired in February, 1921,
subscriber died in May, 1921, building begun 1923) ; In re Converse Estate, 240 Pa.
458, 87 Atl. 849 (1913) (conditional subscription, court impounded sum equal to subscription pending acquisition of endowment fund in reasonable time after death of
subscriber and then, finding the condition had been met, awarded the fund to charity).
Contra:, Stuart v. Second Presbyterian Church, 84 Pa. 388 (1877).
See also School District of Kansas City v. Sheidley, 138 Mo. 672, 686, 40 S.W.
656, 659 (1897) ("The notes became valid and irrevocable contracts as soon as the
district, relying upon their payment, expended money or incurred liability in promoting the general enterprise. This occurred before Sheidley was adjudged insane,
and his insanity or death thereafter could not revoke them.").
45. RESTATEMENT 45. See cases cited supra, note 38.
46. RESTATEMENT 48; WiLLisToN 62; FansoN, RATIONAL BASIS OF CONTRACTS
110 (1949) ; Gay v. Ward, 67 Conn. 147, 34 Atl. 1025 (1895) ; Buckeye Cotton Oil
Co. v. Amrhein, 168 La. 139, 121 So. 602 (1929).
469
on the promise and without knowledge of the promisor's death,

liability should depend on the nature of the acts the promisor should
reasonably have expected the promisee to perform, not on whether
the promisor is dead. 7
Decisions as to the effect of the death of the promisor on the
power of the gratuitous promisee are not numerous. And, as has
been intimated, the rationale of those which mechanically rule that
the death of the promisor terminates all power in the promisee to
create liability is subject to question. The few cases on the point
have assumed that a gratuitous promise is to be treated as an offer.
Fundamentally, such an assumption is erroneous, for, as defined in
the Restatement, an offer is "a promise which is in its terms conditional upon an act, forbearance or return promise being given in
exchange for the promise or its performance."' s An offer is only one
type of promise-the type which is found when the transaction is
cast in the context of bargain and exchange, a context which is not
present in the true instances of promissory estoppel where the promise
must be gratuitous. Thus it would seem that courts which are
confronted with the question of the effect of the death of the promisor
on the power of the promisee to create liability on a promissory
estoppel theory need not feel themselves bound by cases dealing with
commercial transactions (where a bargain and exchange was contemplated), or even by the subscription cases which falsely classified
the subscriber's promise as an offer. Rather, the courts should be
guided by a consideration of the nature of the action reasonably to
be contemplated by the promisor. If that action is possible without
the continued existence of the promisor, the court can enforce it if
that is the only way to avoid injustice.4 9
We have considered to this point certain characteristics which
are found in those gratuitous promises which are enforced through
the application of the doctrine of promissory estoppel. We have seen
that, initially, there must be a promise, as distinguished from a
statement of "intention or of opinion or from a mere prophecy." "
An objective test of reasonable foreseeability must be met before
liability will be imposed on the promisor through action in reliance
on his promise. The requirement that the action or forbearance be
475,
47. This is the intimation in Pratt v. Trustees of the Baptist Society, 93 Ill.
479 (1879) ("The question that has been raised, in some cases, whether a party acting in good faith upon the belief that the principal is alive, may recover, does not
arise here, as there is nothing in the evidence to authorize the inference that the bell
here was purchased under the belief that Pratt was still alive.").
48. RESTATEMENT 24.
49. Support for such a view is found in the cases imposing liability on the subscriber's estate where the promisee began to act in reliance on the promise before his
death or insanity. Cases are cited at note 44, suPra.
50. RESTATEMENT 2, comment A.
470
that of the promisee, not of third parties, is also explicit in Section 90.
In addition we have concluded that the promise may be recalled by
the promisor, just as an offer may be revoked, and it is subject to
being affected by the death or insanity of the promisor.
If a gratuitous promise meets the description contained in the
preceding paragraph, it may afford the basis for contractual liability
through promissory estoppel. That liability, however, will not follow
unless certain other factors are present. One of these factors is next
discussed.
ACTION OF A DEFINITE AND SUBSTANTIAL CHARACTER INDUCED
BY THE PROMISE
Just as the preceding section opened with a question, so does

this one. Did the promise induce action or forbearance of a definite
and substantial nature on the part of the promisee?
It is explicit in promissory estoppel that before the gratuitous
promise will be enforced there must be action "induced" " by the
promise. The reason for this is not hard to perceive. In contracts,
as in torts, courts are confronted with the necessity of prescribing
certain limitations on one's responsibility for the consequences of his
conduct. These limitations may have their genesis in value judgments
formulated by the tribunals which are asked to impose legal consequences on such conduct. Just as it may be neither wise nor advisable
to go too far in enforcing promises believed to be worthy of legal
sanction, so it may be just as desirable for courts to refuse to enforce
at all certain other promises. As Hadley v. Baxendale52 furnishes
one answer to "where shall we stop?" so the law of consideration,
mutual assent and the rules governing the formation of contracts
furnish an answer to the question "where shall we begin?" " In the
field of torts analogous questions and answers are found in the
subject of causation.54 So it is with promissory estoppel. We begin
with a promise, but before liability is imposed for non-performance
the promisee must furnish the court with reasons for enforcement.
One acceptable reason could be that the promise induced or brought
about action or forbearance by the promisee. If one causes another
to act in a particular way he furnishes a justifiable basis for inter51. "Induce" is defined as "to bring on or about, to effect, cause, to influence to
an act or course of conduct, lead by persuasion or reasoning." State v. Stafford, 55
Idaho 65, 37 P.2d 681, 682 (1934).
52. 9 Ex. 341 (1854).
53. Fuller and Perdue, The Reliance Interest in Contract Damages: 1, 46 Y.LE
L.J. 52, 84-85 (1936).
54. PROSSER, TORTS 45 (1941) ("Some boundary must be set to liability for the
consequences of any act, upon the basis of some social idea of justice or policy.")
McCoamicx, DAMAGES 72-73 (1935).
vention by the court. Absent such cause-effect relationship there

appears to be no acceptable justification for imposing contractual
liability on the gratuitous promisor.
As a first step, then, in considering the second of the elements
into which this paper divides the doctrine of promissory estoppel,
we should consider what, if any, action is induced or brought about
by the promise. The second step requires a determination of whether
that action is definite and substantial. If it is, enforcement may
result.
No ACTION INDUCED By TIRE PROMISE
It is logical to say that if the promise induced action there may
be liability; absent such action, certainly no liability will be imposed.
The cases bear out this conclusion and establish its validity. The
charitable subscription provides a particularly fruitful source of
instances in which recovery on a gratuitous promise failed because
there was no proof of action induced by the promise. The reasons
usually given for denying recovery are, as would be expected: "There
was no reliance on the subscription paper ;" " "the college failed to
show it expended any money or incurred any enforceable liabilities
in reliance upon the note;" 56 or "there is no showing that the church
altered its position." 57 This same logical approach has been evidenced
in some of the more recent cases involving the validity of charitable
subscriptions. A charitable subscription, as such, is not sacrosanct.
For enforcement to follow in its train, the charity, at the least, should
show that the subscription induced it to change position. If no such
change was caused, enforcement is properly denied.58
55. McCrimmon v. Cooper, 27 Tex. 113 (1863)
(didn't build on the strength of
the subscription); Presbyterian Church of Albany v. Cooper, 112 N.Y. 517, 20 N.E.
nor is there any evidence that the trustees did anything.").
352 (1889) (". ..
56. Trustees of La Grange College v. Parker, 198 Mo. App. 372, 200 S.W. 663
(1918) ; In re Tummond's Estate, 160 Misc. 137, 290 N.Y.S. 40 (Surr. Ct. 1936).
57. Matter of Taylor's Estate, 251 N.Y. 257, 167 N.E. 434 (1929) (reversing
judgment of surrogate, who had overruled an objection to the effect that the executors should be surcharged because they paid a charitable subscription of deceased,
in order that evidence might be offered on the consideration for the subscription).
It is worth noting that when the case was again heard, the surcharge was then refused
because "church officials, relying on the pledge did maintain the church and assume
obligations." Matter of Taylor's Estate, 236 App. Div. 571, 574, 260 N.Y.S. 836, 838
(Sup. Ct. 1932) ; Trustees of Foxcroft Academy v. Favor, 4 Me. 382 (1826) is an
early example.
58. Wesleyan University v. Hubbard, 124 W. Va. 434, 441, 20 S.E.2d 677, 680
(1942) ("Wesleyan University is not shown to have altered its position in the least
due the pledge of S. P. Hubbard; it created no chair of Economics and Social Science,
incurred no oblligations, made no expenditures, suffered no detriment and parted with
nothing."); Floyd v. Christian Church Widows and Orphans Home, 296 Ky. 196, 176
S.W.2d 125, 128 (1943) : "The evidence failed to show that any of the three institutions performed any act or incurred any obligation which it would not have performed
or incurred had the pledges sued on not been made." (recovery on subscription, denied) ; American University v. Collings, 59 A.2d 333, 334 (Md. 1948) : "In these
472
Particularly where the promisor expressly withdraws his promise

before the promisee has acted upon it, recovery on the promise should
be denied. In such an instance no reasonable promisee could be justified
in claiming that he was thereafter induced to take any action because
of the promise.59 And without such an inducement, the court lacks any
justification for enforcement. Similar rulings are found in other factual situations ranging from attempts to enforce gifts of realty,6 0
through business transactions. 6 1 However, as would be expected,
occasional decisions are found which show that some courts ignore or
fail to understand that unless the promise induced justifiable action by
the promisee, enforcement is unjustified. Two of these cases merit
discussion.
One of them is Snell v. Trustees,6 2 the other is Tioga County
Hospital v. Tidd. 8 In the Snell case, defendant subscribed $1,000 to
assist in building a new church. Thereafter, and before any work had
been done, the subscriber asked the trustees to promise him "that 'X'
should never speak in the new church." They refused and he notified
them that he "would never pay a cent of his subscription unless they
would give such pledges." 64 At this point the trustees certainly knew
that the subscriber desired, at the very least, to attach a condition to
his subscription. The court "without meddling with the question of the
right of revoking the subscription" enforced the subscription because
his "action was so groundless and capricious a character, the notification being given only to the trustees, his generous subscription remaining at the head of the subscription list others might well have been led,
notwithstanding such notice, to make expenditures and incur liabilities,
cases, however, the promisee had actually incurred obligations relying upon the promises. In the case before us, it is not claimed that any such obligations had been entered
into." (Pledge held to violate Statute of Wills, recovery denied.)
59. George v. Harris, 4 N.H. 533 (1829) (the subscriber can escape liability only
by showing that before anything was done he notified the others that he would withdraw) ; Augustine v. Trustees of Methodist Episcopal Society, 79 Ill. App. 452 (1898)
(a voluntary subscription may be withdrawn at any time before money has been expended or liability incurred on the faith of it) ; First Cong. Church v. Gillis, 17 Pa.
Co. Ct. 614 (1896) (no new obligation was incurred here. Nothing done in reliance,
subscriber merely promised to pay an already existing debt of the church) ; Ludwig
v. Ludwig, 170 Wis. 41, 172 N.W. 726 (1919).
60. Allshouse's Estate, 304 Pa. 481, 488, 156 Atl. 69, 72 (1931) ("An exception
to this rule is that of a parol gift of real property, to which the statute of frauds is
held to be no bar to enforcement if the donee has taken possession of the land and
made improvements on it. Here the donee did not take possession or improve the
premises, so as to entitle him to equitable relief.").
61. Curtis Candy Co. v. Silberman, 45 F.2d 451, 453 (6th Cir. 1930) ("But we do
not consider this such a [ 90] case. This growing doctrine of the law is founded
upon the injustice and hardship arising from the justifiable reliance of the promisee
upon the promise, should such promise be held unenforceable for want of consideration. Here the evidence discloses no such hardship upon or unfairness towards the
plaintiffs, nor unremunerated services, nor expenditure by them of such substantial
character as would justify the application of the principle referred to.").
62. 58 Ili. 290 (1871).
63. 164 Misc. 273, 298 N.Y.S. 460 (1937).
64. Snell v. Trustees, 58 Ill. 290, 292 (1871).
on the faith that his subscription would be made good." Two points
seem to be included in the opinion: (1) revocation will not be effective
if capricious and (2) the possibility that persons might have been
induced to rely on a promise justifies enforcement. Neither reason is
sound. In revocation, the question is not whether the promisor is
justified in withdrawing, but whether the promisee was informed of
the withdrawal. 5 If the promisee has been so informed, he no longer
possesses the power to create contractual liability by subsequent actions.
So far as third parties are concerned, the promise was not made to
them. They were not privileged to act on the promise. Even if they
have done so, that, in itself, furnishes no basis for permitting the
promisee to recover on the promise. Recovery should only be possible
when the promisee has acted in reliance on the promise. Thus the court
ignored the fundamental principle that contracts arise out of assent and
imposed liability despite all the promisor's efforts to withdraw.
In the second case, 6 the defendant signed a subscription card
agreeing to pay $7,200 for the X-ray room in a hospital as a memorial
to his father. The next day he wired an explicit cancellation of his
subscription. The court nevertheless enforced the promise on the
theory of an implied agreement on the part of the promisee to build the
hospital, thus creating a bilateral contract. There would be no quarrel
with such a decision if the parties actually were trying to bargain.
However, the context of the case shows that they Were not. The
solicitors were seeking a gift for a charity. They received a promise
to make a gift in the future (evidenced by a subscription card), and
that promise was withdrawn before any action had been induced by it.
Certainly the court would have found no bilateral contract if the situation were reversed and the subscriber were attempting to force the
hospital to build the X-ray room. So the quarrel is with the techniques
used by the court; converting what was a gratuitous promise into a
bargain and exchange.
Admittedly, this is a technique which has the stamp of approval
of such an eminent jurist as Justice Cardozo,"7 but that does not justify
its use in charitable subscription cases. It does not appear in the Tidd
case that the charity did anything in reliance on the gift-promise or
that it changed its position in any way. By holding that a bilateral
65.
RESTATEMENT
35(1): "An offer may be terminated by (e) revocation by
the offeror." 41: "Revocation of an offer may be made by a communication from

the offeror received by the offeree which states or implies that the offeror no longer
intends to enter into the proposed contract, . . . ." WILLISTON 55.
66. Tioga County Hospital v. Tidd, 164 Misc. 273, 298 N.Y.S. 460 (1937).
67. Cardozo, C.J., in Allegheny College v. National Chautauqua County Bank of
Jamestown, 246 N.Y. 369, 159 N.E. 173 (1927) employed the device, though needless-
ly, for in that instance there had been action in reliance on the promise, an element
that is lacking in the Tidd case.
474
contract had been created the court avoided the problem really presented by the revocation. The court should have treated the case for
what it was-a promise to make a gift in the future-and should have
dealt with the attempted revocation. Had it done so, a different and
more appropriate decision might well have resulted.
The cases previously discussed indicate the validity of the requirement that the promise induce action in reliance by the promisee before
enforcement of a gratuitous promise results. The last two cases point
up some problems which are likely to arise in the future application of
the promissory estoppel doctrine. Courts, motivated by a desire to aid
what they regard as a worthy charitable institution, may be inclined
to twist the factual situation to fit the mold of bargain, or they may
ignore attempts at withdrawal by the promisor. Alert counsel can
prevent such results by effective analysis of the fact-situation involved
and by appropriate argument. In the long run, though, it seems likely
that the courts will gain a clearer understanding of the essential elements of promissory estoppel and will tend to emphasize, more than
their predecessors have done, the necessity of showing that the promise
sued on induced a change of position. Such emphasis will give added
clarity to the fundamentals of promissory estoppel. The likelihood of
this development is indicated by the more recent decisions."8
INSUBSTANTIAL ACTION INDUCED BY THE PROMISE
It should be clear by now that if the gratuitous promise does not

induce some action or forbearance, it is not binding. The Restatement
requires that the action or forbearance be "of a definite and substantial
character." What of the cases in which "some action" was induced
but it was relatively insubstantial? These cases are our next concern
for they will indicate some of the factors affecting the value judgments
of courts when they deal with promissory estoppel and will aid in
determining the way in which the doctrine is likely to develop.
Here, in contrast with the cases last discussed, there is no question
but what the action was caused or brought about by the promise. The
inquiry, therefore, is not as to the cause of the action or forbearance,
but as to the amount. Cases involving attempts to enforce parol
promises to give land are illustrative. 9 Certainly, "taking possession"
of the land is an action induced by the promise. But that is not
68. See note 58 supra.
69. It is not necessary here to explain the justifications for the part performance
doctrine. Those interested may examine 2 CHAFEE AND SIMPSON, CASES ON EQUITY,
1111 (1st ed. 1934) ; HANDLER, CASES AND MATERIALS ON THE LAW OF VENDOR AND
PURCHASER 27 (1933) ; MCCLINTOcs, EQUITY 59 (2d ed. 1948). Here we are interested in actions that are not sufficiently substantial to motivate the court to grant
relief, not in the rationale of the part performance doctrine.
475
enough." Neither is the making of improvements of a "temporary

character." 71 And one line of cases attempts to determine the substantiality of the action by measuring the improvements against the rental
value for the occupancy of the premises, 72 though such a test has not
met with unanimous approval.73 If such a test is adopted, a litigant,
by delaying the bringing of his suit, might build up a false "equity"
in favor of his view, as would one who seeks to claim credit for
improvements by him which actually were paid for with the promisor's
own money.7 4
The indicated tendency is to refuse enforcement of the gratuitous
promise where the only action induced is "insubstantial." In the cases
the term "insubstantial" seems to be characterized by triviality in an
economic sense. One may say that if the promisee is out of pocket only
a small sum, he really has not suffered harm serious enough to motivate
the courts to action. Especially is this true where his expenditures
were for his own temporary comfort. Support for such a holding may
be found in the doctrine of de minimis. On the other hand, there seems
to be no reason why the doctrine of promissory estoppel should be
restricted, as such a view indicates, to instances of sizeable financial
loss. Injuries to personality, to character and reputation, to expectations may equally well result from action induced by a promise. They
seem to merit protection as much as do financial interests.
When considering the problem of insubstantiality, we really are
passing on the justice of the result as well as measuring the action
taken. The avoidance of injustice is considered later in this paper,
hence further analysis is postponed. Suffice it to say here that the
cases indicate that the courts tend to require proof of serious harm to
the promisee before they will interfere. They probably will continue
to do so. Enforcement of a gratuitous promise is so far outside the
70. Bright v. Bright, 41 Ill. 97 (1866) (no improvements, no liability incurred,
simply took possession).
71. Nugent v. Dittel, 213 Iowa 671, 239 N.W. 559 (1931) (improvements consisted of papering, varnishing, some painting, the planting of some shrubs and providing the gas connection for the laundry stove. Those were "trivial outlays"). Accord,
Mitchell v. Redus, 144 Ark. 332, 222 S.W. 47 (1920) ($2 or $3 spent in repairing a
roof) ; Bigelow v. Bigelow, 93 Me. 439, 452, 45 At. 513 (1900) (promise not to foreclose a mortgage, slight improvements made for convenience, not because of the promise).
72. Burris v. Landers, 114 Cal. 310, 46 Pac. 162 (1896) (Expenditures of $548;
reasonable worth of occupancy for two years set at $720. Enforcement refused);
Wooldridge v. Hancock, 70 Texas 18, 6 S.W. 818 (1888).
73. Texas changed its ruling. Hudgins v. Thompson, 109 Tex. 433, 211 S.W.
586 (1919) ; Rosek v. Kotzur, 267 S.W. 759 (Tex. Civ. App. 1925) (expenditure must
bear a reasonable proportion to the value of the land; this is a question of fact) ; Barrett v. Calloway, 66 S.W.2d 367 (Tex. Civ. App. 1934); Young v. Overbaugh, 145
N.Y. 158. 39 N.E. 712 (1895) (value of occupancy is not to be set off against the
improvements made).
74. This was the situation in Greer v. Goudy, 174 Il. 514, 51 N.E. 623 (1898)
where the promisor's estate was protected.
476
bargain concept that the promisee who has not made a serious change
of position is unlikely to induce courts to aid him. He is in the same
category as the promisee who has not relied at all upon the promise.
ACTION OF A DEFINITE AND SUBSTANTIAL CHARACTER
To this point we have considered instances in which the promise

either induced no action or action of only an insubstantial character.
There remain for analysis the instances in which the induced action
was of a "definite and substantial character." The importance of these
cases is manifest, for it is this type of promise which the Restatement
describes as "binding." Here the inquiry will be directed towards
discovering what action will meet the dual requirement of definiteness
and substantiality.
The construction of substantial improvements by the donee on
real estate is generally accepted as satisfactory evidence of such a
change of position as to justify the enforcement of a gratuitous promise
to bestow it on him. 75 A similar holding is found where a mortgagor
makes improvements in reliance on the mortgagee's promise to refrain

from enforcing or foreclosing a mortgage.76
Certainly the construction on land of improvements by the
promisee is to be expected where the promisor puts the promisee in
possession and tells the promisee that the land is his. It is customary
for the owners of land to improve it, oftentimes by the erection of
structures thereon. So the resultant action in these cases is reasonably
to be expected. Can this particular sort of action by the promisee be
considered substantial as well as definite? That will depend on the
character and extent of the improvements. Whether it is substantial
can be determined by examining the amount of economic expenditure.
Whether it is definite, in the sense that it is specific and ascertainable,
can be determined by examining what was done.
While the land-gift cases apparently restrict the sort of action
which will create enforceability to the expenditure of time or money
in improving the land itself and its appurtenances, the action in
charitable subscriptions is not thus restricted. In the typical charitable
subscription case, the promisor subscribes, i.e., promises to pay in the
75. Illustrative cases include: Akins v. Heiden, 177 Ark. 392, 7 S.W.2d 15 (1928) ;
Greiner v. Greiner, 131 Kans. 760, 293 Pac. 759 (1930) ; Kurtz v. Hibner, 55 Ill. 514
(1870) ; Lindell v. Lindell, 135 Minn. 368, 160 N.W. 1031 (1917) ; Roberts-Horsfield
v. Gedicks, 94 N.J. Eq. 82, 118 Atl. 275 (1922), aff'd 96 N.J. Eq. 384, 124 At. 925
(1924) ; Seavey v. Drake, 62 N.H. 393 (1892). WLLISTON 139, note 20, lists numerous cases in accord.
76. Faxton v. Faxon, 28 Mich. 159 (1873) ; Herron v. Brinton, 188 Iowa 60, 175
N.W. 831 (1920). Semble, Lembke v. Lembke, 196 Iowa 136, 194 N.W. 367 (1923)
(oral promise to give an easement enforced where land is purchased in reliance on
the promise).
future, a specific sum of money to the charity. The charity then proceeds to make expenditures or incur obligations in reliance on the
subscription. If these be the facts, it is the almost invariable rule to
enforce the promise. Acts of charities which have been considered by
the courts as definite and substantial enough to justify enforcement
of the subscription include: commencing construction of an administration building, enlarging college courses and incurring other obligations ;7 erecting a church building ;"' borrowing money on the security
of the subscriptions to pay an existing church debt ;79 and continuing
the charitable work in which already engaged."0
One encounters an occasional discordant note, as in Cutwright
v. Preacher's Aid Society,8 where there is an implication that continuing the work of the charity is not sufficient action to make the
promise enforceable. Yet what else is to be done by a charity presently
in operation? One could not expect it to expand to new lines of
charitable work any more than one would expect a symphony orchestra
to which one has promised a sum of money to do other than continue
its concerts.8 2 If the current activity continues there has been action
which is both definite and substantial, as well as expected. Failure to
recognize the reality of the induced activity subjects such cases to
criticism.
Aside from the charitable subscription and parol gift of land
cases, there are numerous others illustrating the sort of action that is
definite and substantial enough to afford the promisee relief. Renting
new quarters in reliance on a promise to excuse one from continuing
to pay on an existing lease,83 purchasing land in reliance on a promise
to procure a mortgage loan,8" becoming obligated to pay for a mill in
reliance on a father's promise to provide five thousand dollars to apply
on the purchase price,8 5 or making other committments of a business
nature,86 have all been considered sufficient.
77. University of Southern California v. Bryson, 103 Cal. App. 39, 283 Pac. 949
(1930) (pledge of $200,000 enforced).
78. McDonald v. Gray, 11 Iowa 508, 79 Am. Dec. 509 (1861) ; Lippincott's Estate,
21 Pa. Super. 214 (1902) ; In re Stack's Estate, 164 Minn. 57, 204 N.W. 546 (1925).
79. Erdman v. Trustees of Eutaw M.P. Church, 129 Md. 595, 99 Atl. 793 (1917).
80. Re Drain, 311 Ill. App. 481, 36 N.E.2d 608 (1941) ; I & I Holding Corp. v.
Gainsburg, 251 App. Div. 550, 558, 296 N.Y.S. 752 (1937), aff'd 276 N.Y. 427, 12
N.E.2d 532 (1938).
81, 271 Ill. App. 168, 177 (1933).
82. Russian Symphony Society v. Holstein, 199 App. Div. 353, 192 N.Y.S. 64
(1922).
83. Fried v. Fisher, 328 Pa. 497, 196 Atl. 39 (1938).
84. Evers v. Arnold, 210 S.W.2d 270 (Tex. Civ. App. 1948).
85. Steele v. Steele, 75 Md. 477, 23 Atl. 959 (1892).
86. Martin v. Dixie Planing Mill, 199 Miss. 455, 24 So.2d 332, 334 (1945)
(promise to extend time in which to remove timber) ; Terre Haute Brewing Co. v.
Dugan, 102 F.2d 425 (8th Cir. 1939) (expenditures in reliance on exclusive franchise
for sale of beer) ; Bassick Mfg. Co. v. Riley, 9 F.2d 138 (E.D. Pa. 1925) (gratuitous
license to use trade name in business).
478
In these instances the result produced could be demonstrated by

competent evidence, thus it was "definite." And the action was considered by the court as being of a substantial character, at least in the
sense that the promisee's financial status would be adversely affected
by failure to enforce the promise. Perhaps another way of characterizing this requirement is to say that it demands of the promisee a
showing of detrimental reliance on the promise before there will be
enforcement, for as Mr. Williston has said, "the binding thread of
principle in all these cases is the justifiable reliance of the promisee." 87
Even conceding that a detrimental change of position in reliance
on a promise justifies enforcement, must the change of position always
be "detrimental" in an economic sense? If the promisee has changed
his mode of living he is not necessarily harmed, though he may fail to
realize his expectations if the promise is not enforced. So, if a promisee
marries in reliance on a promise gift, it would not follow that he has
suffered detriment, though he has certainly changed his way of life.
A court would find it difficult to adopt any formula by which to determine the pecuniary amount with which to compensate for the breach
of such a promise. A much easier method is to enforce the promise,
thus avoiding the difficulty of attempting to measure elements which
are not easily susceptible of ascertainment.8 8 It is to be observed that
the doctrine of promissory estoppel, as formulated in the Restatement,
does not require that the action or forbearance of the promisee be
detrimental. Nor does that requirement seem necessary. If there
has been such action on his part that the restoration of the status quo
is difficult or impossible, it is unjust to the promisee to deny enforcement."9 If the trier of fact determines that the action was because of
and in reliance on the promise, there merely remains for measurement
the quantum of the action. If it bulks large enough, enforcement
should be considered.
The Restatement provides a measuring stick for determining the
quantum of necessary action by requiring that the action be of a
"definite and substantial character." There is, in Section 90, no
87. A.L.I. COmmENTARmS ON CoNTRAcrs, Restatement 2, 19-20 (1926).
88. This may be one explanation for cases like Hamer v. Sidway, 124 N.Y. 538,
27 N.E. 256 (1891), where plaintiff abstained from "drinking liquor, using tobacco,
swearing, and playing cards" until he was twenty-one years old in reliance on his
uncle's promise to pay $5000. The promise was enforced. Lamb v. Hinman, 46 Mich.
112, 6 N.W. 675 (1881) uses this argument to support enforcement of an oral contract
for the conveyance of land where the purchaser had taken possession and made improvements. The argument applies with equal force to parol promises to give land.
89. Language in a recent case overemphasizes "detriment" at the expense of
"change of position." Robert Gordon, Inc. v. Ingersoll-Rand Co., 117 F.2d 654, 661
(7th Cir. 1941) (". . . . But even so, the doctrine [of promissory estoppel] may not
be invoked here. Justifiable reliance and irreparable detriment to the promisee are
requisite factors among others. In the instant case the promisee has failed to show
irreparable detriment.").
requirement that one certain, specific action necessarily be foreseen

before there can be contractual liability, though Mr. Williston once
said as much.90 Foreseeability of some action certainly is a requisite, 91
but the doctrine need not necessarily be restricted to those instances
where the promisor enjoyed and exercised "second sight."
It is with regard to this requirement as to the character of the
action induced by the promise that we may expect to see some development in the years just ahead. By using the words "definite" and
"substantial" in the requirement, there is a studied attempt to narrow
the applicability of promissory estoppel. Not just any action in reliance
on any gratuitous promise is enough. The action must be of a particular sort in order for the court to feel justified in intervening. When
the promisee has made a considerable outlay or has done serious acts
which, unrewarded, might jeopardize his financial or economic status,
his position is one which merits judicial intervention. There is, however, a danger that courts will not understand the doctrine and be
fearful of applying it. Unless this requirement is formulated so that
it is readily understandable and applicable, the doctrine may be strictly
limited in its use, thus failing to provide a needed amount of flexibility
in contract law. Indications of this tendency are already apparent in
holdings that promissory estoppel is to be employed only in charitable
subscriptions,92 and is not to be resorted to in commercial transactions.
93
As formulated by the American Law Institute promissory estoppel

is not restricted in its application to specific compartments of our legal
theory. It is intended to provide a general rule of contractual liability.
The limitations requiring definite and substantial character in the
actions induced afford an objective standard for its application which
should not be imperiled by further limitations.
FORBEARANCE
Just as a person who induces one to take action of a particular

kind and character thereby furnishes a court which is asked to enforce
the gratuitous promise with a reason for acting,94 so a promisor who
induces one to forego action furnishes an equally good reason for the
intervention of a court. This reasoning explains why Section 90 of
the Restatement describes the gratuitous promise which may create
90. 4 PROCEEDINGS A.L.I., App. 93 (1926).
91. See notes 52-54 supra.
92. Comfort v. McCorkle, 149 Misc. 826, 831, 268 N.Y.S. 192 (Sup. Ct. 1933)
(refusing to apply the doctrine to a gratuitous promise to insure).
93. James Baird Co. v. Gimbel Bros., Inc., 64 F.2d 344, 346 (2d Cir. 1933).
94. See notes 52-54 supra.
contractual liability as one which induces "action or forbearance of a

definite and substantial character." Illustrative cases demonstrate that
the importance thus given to forbearance is merited.
The economic loss which the promisee will suffer is apparent in
instances in which there is a failure to institute suit because of a reliance
on the gratuitous promise, 95 as well as in the instances in which, in
reliance on another's gratuitous promise to procure insurance on
property, the promisee fails to obtain it himself and fire thereafter
causes loss.9 6 In the first case the promisee will lose all opportunity
for judicial enforcement of his claim, in the second he will suffer the
damages to his property without opportunity of reimbursement for his
loss, if the promise is not enforced.
In W. B. Saunders Co. v. Galbraith,7 a widow promised to pay
her deceased spouse's debt to plaintiff, who refrained from filing a
claim against deceased's estate. Thereafter the widow gave a note
and mortgage to secure the debt. When the plaintiff sued to foreclose,
the defense was want of consideration. The court refused to entertain
the defense, saying that the promise reasonably induced plaintiff to
forbear asserting its claim against the estate at a time when it would
have been effective. The court relied squarely upon Section 90 saying,
"We are content, however, to take the restatement as the law of this
state without exploring its soundness, and to hold that of its own vigor
it is adequate authority. The facts of the case at bar come squarely
within the terms of the section referred to."98
In Lusk-Harbison-Jones,Inc. v. Universal Credit Co., 99 plaintiff
refrained from procuring insurance in reliance on a confidential pamphlet, distributed to it and other dealers, which said that when cars
are repossessed by dealers from delinquent purchasers "insurance protection for dealer's interest will continue in force until the account
is liquidated, after which the dealer should provide such insurance as
he may require." Forbearance in reliance on the circular's representation was held sufficient to make the defendant liable when, as events
turned out, the dealer had not provided other insurance and plaintiff's
automobiles were destroyed by fire. This court, too, relied solely on
Section 90 of the Contracts Restatement as authority for enforcement
95. W. B. Saunders Co. v. Galbraith, 40 Ohio App. 155, 178 N.E. 34 (1931);
Renackowsky v. Board of Water Commissioners, 122 Mich. 613, 81 N.W. 581 (1900);
Armstrong v. Levan, 109 Pa. 177, 1 Atl. 204 (1885).
96. Lusk-Harbison-Jones, Inc. v. Universal Credit Co., 164 Miss, 693, 145 So. 623
(1933) ; Siegel v. Spear & Co., 234 N.Y. 479. 138 N.E. 414 (1923) ; Schroeder v.
Mauzy, 16 Cal. App. 443, 118 Pac. 459 (1911); Barile v. Wright, 256 N.Y. 1, 175
N.E. 351 (1931).
97. 40 Ohio App. 155, 178 N.E. 34 (1931).
98. Id. at 159, 178 N.E. at 36 (1931).
99. 164 Miss. 693, 145 So. 623 (1933).
481
of the promise.' 0 Argument might be made as to the soundness of

concluding that the forbearance was foreseeable, but the seriousness
of the economic consequences of forbearance is beyond question.
These two cases indicate the weight given to forbearance in the
application of promissory estoppel by courts which fully accept the
doctrine. Additional illustrations include the promise to buy and hold
property for the promisee, in reliance on which the promisee stands by
In such an instance
and allows the promisor to purchase at a sale.'
the economic loss suffered by the promisee, when the promisor refuses
to convey, is clear. If justification is necessary for the enforcement of
a promise which causes the promisee to respond only in a negative
way (that is, by forbearance), it may be found in the realization that
refraining from acting may be no different than action, in so far as
the effect on the promisee is concerned. Whether the promise induced
a college to build a dormitory, or a claimant to withold the filing of his
claim until the statute of limitations has run, each promisee is adversely
affected by his reliance on the gratuitous promise. Action or inaction,
so long as caused by the promise, are equated. Recognition of this
has long been present in accepted rules of contract consideration.
Complaint may be made that a rule requiring the action or forbearance of the promisee to be of a "definite and substantial character"
is too indefinite to furnish any assistance in adjudicating the rights
of the parties. It must be admitted that the rule is indefinite as compared with many rules of law, 10 2 but it is no more indefinite than the
rule permitting a building contractor to recover on the contract when
he has rendered "substantial performance," '03 or the rule that a vendor,
who is unable to convey all the land he agreed to convey, can have
specific performance against the purchaser if the defect is "insubstantial." 104 It must be recognized that all such rules are but useful
generalizations and that, as generalizations, they emphasize factors
which are important but which may tend to defy measurement. A rule
dealing with mailing of acceptances is specific, but only because the
rule itself deals with a particular, exact and easily described act which
will not usually be confused with other acts. In contrast, it is apparent
100. 145 So. 623, 624 (1933).
101. Ellingson v. State Bank of Hoffmann, 182 Minn. 510, 234 N.W. 867 (1931);
Tchula Commercial Co. v. Jackson. 147 Miss. 296, 111 So. 874 (1927); Wolfe v.
WallingfQrd Bank & Trust Co., 124 Conn. 507, 1 A.2d 146 (1938).
102. An offer inter absentes, for example, is held to be "accepted" when a letter
of acceptance is deposited in the mails. RESTATEMENT 64, 67; WLISTON 81.
Here it is possible for the court to establish a recognizable point in time as the instant
when the contract arises.
103. Jacob & Youngs v. Kent, 230 N.Y. 239, 129 N.E. 889 (1921); W.LisToN
805, 842; RESTATEMENT 346.
104. McCINTOCK, EQUITY 66 (2d ed. 1948); Poole v. Shergold, 2 Bro. C.C.
118, 1 Cox. Eq. 273, 29 Eng. Rep, 68 (1786) ; Tolchester Beach Improvement Co. v.
Boyd, 161 Md. 269, 156 Atl. 795 (1931).
482
that when one deals with the "substantial character" of the performance rendered in either erecting a building or tendering a deed to a
tract of land, he has advanced to a higher level of thought and towards
a generalization. In applying the generalization we will have to exercise judgment to determine whether the action performed rises to the
dignity of substantiality. In law, one cannot avoid "questions where
mathematics will not help." 105
In reality, then, this complaint of indefiniteness is unjustified. The

cases show that there is value in requiring the promisee to prove that
his action was more than ephemeral, more than trivial and, in actuality,
was of some consequence to him, before the gratuitous promise will be
enforced because of reliance on it. The line between these two is as
clearly defined as possible by the phrase "definite and substantial."
We have seen that the first element of the doctrine of promissory
estoppel is "a promise likely to induce action" on the part of the
promisee. We have just considered a second element which requires
that the promise have induced action or forbearance, and that this
action be definite and substantial. The two requirements constitute
necessary and desirable elements in the doctrine of promissory estoppel.
We have yet to consider whether that doctrine includes a third
requirement.
THE AvOIDANCE OF INJUSTICE BY ENFORCEMENT OF THE PROMISE
The Restatement's formulation of the doctrine of promissory

estoppel concludes with the assertion that the gratuitous promise there
described "is binding if injustice can be avoided only by enforcement
of the promise." "I Does this clause add an additional limitation to
the doctrine or does it merely furnish a guide in applying the requirements discussed in the preceding portions of this article? The answer
to this question is our next concern.
If the assertion adds an additional limitation to the doctrine, then
every court which is asked to rule that a gratuitous promise is binding
should consider at least three propositions before making its decision:
(1) Was there a promise reasonably expected to induce action or forbearance, (2) Did the promise induce action or forbearance of a definite and substantial character, and (3) Can injustice be avoided only
by the enforcement of the promise? If, however, the admonition as to
the avoidance of injustice is only a guide to the application of the
requirements already discussed, then courts will have only two questions to, answer before rendering judgment: (1) Is it just to find that
105. 4 PROCEEDINGS A.L.I., Apr. 101 (1926).
106. RESTATEMENT 90.
483
the promisor made a promise which he should reasonably have expected

to induce substantial action or forbearance, and (2) Is it just to hold
that the promise did reasonably induce action or forbearance of a
definite and substantial character?
In support of the view that the "avoidance of injustice" is merely
a guide to be used in applying the more definite requirements of the
doctrine, it may be urged that such an approach more nearly accords
with the realities and actualities of the judicial process, because it is
impossible to separate and isolate the element of "injustice" from the
substance of a transaction. In General Electric Co. v. N. K. Ovalle,"7
for example, can it be said that the assertion made during a "pep talk"
was not a "promise" because it would be unjust to the company to so
hold, or should that case be regarded as deciding that since there was,
to begin with, no promise, it was unnecessary for the court to consider
whether there was any need to avoid injustice? This view assumes that
it is extremely difficult, if not impossible, to separate the "injustice"
of the refusal to enforce a promise from the factual context out of
which the promise came. It is possible that the court decided that it
would be unjust to enforce the assertion and, therefore, decided that
there was no promise, as such.
The principle support for the belief that the avoidance, of injustice
is a separate element or requirement of promissory estoppel is the fact
such an approach requires the judge to treat each case in an orderly,
logical fashion. When confronted with a situation where he is asked
to apply the doctrine, he goes through three distinct steps. First, he
considers the conduct of the alleged promisor to determine whether
there was a promise; if he finds no promise, the case ends right there.
But if he does find a promise, he next examines the conduct of the
promisee to determine what if any action or forbearance was induced
by the promise. In this second step he must decide that the action or
forbearance was substantial as well as in reliance on the promise. Then,
and only then, does the judge consider whether injustice can be avoided
only by enforcement of the promise. At this third stage he determines
what other remedies may be available as well as the unfairness, if any,
that will follow non-enforcement. Finally, having considered each of
the three questions in turn, he can formulate a decision. His decision
will be against enforcement of the promise unless he has answered in
the affirmative all three of the questions posed for him under this
approach.
This latter method has the advantage of being logical and systematic. Because it breaks the larger problem of the enforcement of gra107. 335 Pa. 439, 6 A.2d 835 (1939).
484
tuitous promises into smaller segments, it makes for orderly steps in

judicial thinking and easier rational decision. Moreover, it requires
the judge to weigh consecutively all of the individual factors which
may be present. Hence, it is to be preferred to an approach which
fails to insure careful consideration of all the factors involved.
The discussion of Section 90 which occurred at the annual meeting
of the American Law Institute in 1926 supports this view. Throughout that discussion Mr. Williston referred to "the qualification (that)
is necessary, if injustice can be avoided only by the enforcement of
the promise." 108 The intent of those who formulated the Section
deserves consideration in any attempt to interpret or analyze the
doctrine, particularly when that intent is so clearly expressed both in
the language of the Section itself and in the discussion concerning its
approval. This expressed intent coupled with the arguments already
advanced in favor of simplicity of approach indicate that "injustice"
should be accepted as a separate element in the application of promissory estoppel. It is so treated here.
Regardless of which view is adopted, however, it must be realized
that the emphasis which the Restatement places on the avoidance of
injustice calls for the use of ethical standards in applying the doctrine
of promissory estoppel. Judges often feel "the need for some ideal
justification for what they are doing." 10 Appeals to the prevention
of injustice afford to the jurist the opportunity to resort to ethical
principles for justification of his decision. Hence, the use of such an
ethical ideal as the avoidance of injustice aids in securing readier
acceptance of the doctrine of promissory estoppel.
Because the term "injustice" of Section 90 is indefinite (i.e., not
defined within the Section) and "leaves a certain leeway one way or
other to the judge," 110 it is apparent that it will be difficult to establish
the criteria employed by the courts to determine its existence. The
very subjectivity inherent in the term "injustice" makes it apparent
that the effectiveness of the doctrine of promissory estoppel will depend
upon the reaction of the courts which consider the doctrine in the light
of the facts found in individual cases. On the other hand, this subjectivity appeals to the ethical sense of the courts and affords an opportunity for the application of community standards of conduct in
determining liability.
108. 4
PROcEEDINGS
A.L.L, App. 91 (1926).
For other comment on injustice, see
Id. at 86, 92 ("I am willing to interpret injustice more widely than as . . . merely
pecuniary loss"), 98, 103 ("I do not like that [suggestion that all reference to injustice
be omitted] because then you say it is binding whether injustice can be avoided or
not.").
109. PATRSoN, LECTURES ON JURISPRUDENCE 8 (1940) ; Pound, The Ideal Ele-
ment in American Judicial Decision,45 HARV. L. REv. 136 (1931).

110. 4 PROCEEDINGs A.L.I., App. 86 (1926).
485
One of the first questions that comes to mind in considering

this third requirement is injustice to whom? Shall the hardship and
unfairness which are to be avoided be only the promisee's, or should
hardship to the promisor also be considered? It may be argued that
the injustice which is to be avoided should be, primarily at least, the
hardship to the promisee. In any event, only he will seek to enforce
the gratuitous promise. Only to him can a denial cause hardship.
Apparently the American Law Institute accepted the view that the
injustice or hardship with which the court should be concerned when
applying the doctrine is only hardship or injustice to the promisee."'
This concern solely with the promisee is the more readily understandable if it is recognized that the problem of avoiding injustice is
to be considered separate and apart from the other elements and
requirements of the doctrine. It is not that the promisor's position is
totally ignored, for that has been considered in connection with determining the verity of his promise and the reasonableness of the
action induced by it. Rather, it is that in the final step before deciding
to impose promissory liability, it is proper to consider as a separate
element the injustice to the promisee that will follow non-enforcement.
Whether injustice will result from refusal to enforce the gratuitous promise will depend both upon the character of the reliance
evidenced by the promisee's acts and other remedies which are available
to him. In many instances the promisee will have been induced to do
some act or to make expenditures. If it is possible for the promisee
to recover what he has paid or to secure reimbursement for his
expenditures, then the status quo can be restored. Such restoration
makes it unnecessary for the court to enforce the gratuitous promise
and at the same time prevents an injustice to the promisee."' It is
only when restoration of the status quo is impossible that there is
need to resort to the doctrine.
Let us examine some typical examples of the gratuitous promise
to discover the remedies, other than enforcement of the promise, that
may be available to the promisee. Take, first, the case where in
reliance upon an oral gift of land, the donee has gone into possession
and made improvements. This is probably the most common case in
Notwithstanding the prevawhich specific enforcement is granted.'
jurisdictions in the United
four
least
at
are
lence of enforcement, there
States 114 which refuse enforcement but require the promisor to make
111. 4 PROCEEDINGS A.L.I., App. 85 (1926) : "Mr. Williston: I suppose the fair
inference is that it means injustice to the promisee .

112. Id. at 91.
113. 2 A.L.T., COMMENTARIES ON CONTRA S RESTATEMENT 15 (1926); WiLmsTON 4 139.
114. Kentucky (Grant v. Craigmiles, 1 Bibb 203 (1808)), Mississippi (Beaman v.
Buck, 9 Si. & M. 207 (1948)), North Carolina (Albea v. Griffin, 22 N.C. 9 (1838)),
486
restitution to the promisee. Usually this restitution is a sum of money

equal to the value of the improvements made.' 15 In these states the
courts, being unwilling to follow the majority of jurisdictions,""
which enforce such promises, still are impelled to grant some relief.
Fuller would say that this minority is protecting the restitution interest and the majority the expectation interest of the promisee." 7 His
distinction indicates the range of relief that may be deemed appropriate
inthese cases.
The quasi-contractual remedies may be inadequate in this situation. Recovery for the unjust enrichment of the promisor because of
benefits conferred on him by the justifiable action of the promisee
does not altogether prevent an injustice to the promisee. Particularly
is this true when it is held that the promisee's limit of recovery is the
additional value these improvements have conferred upon the
property." 8 Obviously, the promisee's expenditures in making the
improvements may exceed the enhancement in value of the land. In
addition, where the donee has moved onto the promised land and
devoted his labors to its improvement, how can merely paying him the
amount of the enhancement prevent injustice? He has changed his
way of life, he has forgone opportunitnes for employment elsewhere;
to refuse him enforcement disappoints his expectations and presents
an appealing claim to the court which decides his case.
In the land-gift cases when the court enforces the promise and
perfects title in the donee it avoids all necessity of attemping to evaluate
the worth to the promisor of the promisee's action. Thus the court
takes the view that if the injustice to the promisee is serious enough
to merit assistance, he receives all that he expected, and not just
reimbursement.
In the charitable subscription cases, too, the courts are inclined
to this same all-or-nothing view.1 9 Customarily, the charity either
and Tennessee (Patton v. McClure, Mart & Yerg, 333 (1828)). See Pound, The
Progress of the Law: Equity, 33 HAnv. L. REv. 929, 936-937, 949 (1919); Wilhoit,
The Statute of Frauds and Part Performance of Land Contracts in. Kentucky, 22 Ky.
L.J. 434 (1933) ; Note, 1 N.C.L. REv. 48 (1922).
115. Carter v. Carter, 182 N.C. 186, 108 S.E. 765 (1921); Usher's Executor v.
Flood, 83 Ky. 552 (1886).
116. Lindell v. Lindell, 135 Minn. 368, 160 N.W. 1031 (1917); Seavey v. Drake,
62 N.H. 393 (1882); Freeman v. Freeman, 43 N.Y. 34 (1870); Roberts-Horsfield v.
Gedicks, 94 N.J. Eq. 82, 118 AtI. 275 (1922) ; Greiner v. Greiner, 131 Kans. 760, 293
Pac. 759 (1930).
117. Fuller and Perdue, The Reliance Interest in Contract Damages: 2, 46 YALE
L.J. 373, 405 (1937).
118. Pitt v. Moore, 99 N.C. 85, 3 S.E. 389 (1888) ; Wetherell v. Gorman, 74 N.C.
603 (1876).
119. Cotner College v. Hyland, 133 Kans. 322, 299 Pac. 607 (1931) ; Allegheny
College v. National Chautauqua County Bank of Jamestown, 246 N.Y. 369, 159 N.E.
173, 57 A.L.R. 980 (1927) ; In re Stack's Estate, 164 Minn. 57, 204 N.W. 546 (1925) ;
In re Drain's Estate, 311 Ill. App. 481, 36 N.E.2d 608 (1941) ; Trustees of University
of Pennsylvania v. Coxe, 277 Pa. 512, 121 Atl. 314 (1923) ; I & I Holding Corp. v.
Gainsburg, 276 N.Y. 427, 12 N.E.2d 532 (1938).
487
has judgment for the full amount of the subscription or it recovers

nothing. Such a ruling may be acceptable in the usual case, for the
charity will ordinarily require more than the sums subscribed to pay
its obligations. But such a rigid view of the amount of recovery need
not be accepted. There is an intimation in two older cases that when
the promise has been to pay a sum of money for the accomplishment
of a particular objective, an action by the charity will lie to recover
the amount of the subscription or such portion of it as will be equal to
the subscriber'sshare of the expense actually incurred in accomplishing
the objective.' 2 This modification of the usual rule is highly desirable,
for it affords some leeway in administering the doctrine of promissory
estoppel and seems likely to insure a fairer result.
Suppose a university desires to erect a new law building and
obtains from a single subscriber a pledge to pay $750,000, the estimated
cost of the structure. Suppose further that, after the subscription is
given and before any contracts are let, an economic depression occurs,
as a result of which there is a reduction in construction costs. The
university then lets contracts for the law building for a total of
$500,000. When the subscriber refuses to pay and is sued by the
university, what will be the amount of the judgment? Will it be
$500,000 or will it be $750,000? It is apparent that a judgment for
$500,000 should be recovered. Any less would harm the educational
institution, any more would constitute a windfall to the institution as
well as an injustice to the promisor. True, the American Law Institute was told that the recovery should be for the full amount promised, 2 ' but this seems to ignore the very "injustice" which Section 90
purports to avoid. So far as the promisee is concerned, injustice to
him is avoided when he is protected to the extent of his expenditures
made in reliance upon the gratuitous promise. There is no impelling
reason for him to receive more.
In the land-gift and charitable subscription cases, as we have
seen, often the only way to avoid injustice and hardship to the promisee
is to enforce the promise. Consider, however, the case where the landlord merely promises gratuitously to accept less rent than the' lease
requires. It is arguable here that refusing to enforce the promise will
not cause injustice to the tenant-promisee. If the landlord accepts the
lesser sum, the tenant has more money to spend elsewhere; if the landlord, however, still demands the original rent, it is not unjust to
120. Pryor v. Cain, 25 Ill. 292 (1861) ; Miller v. Ballard, 46 Ill. 377 (1868).
121. 4 PROCEEDINGS A.L.I., App. 95-96, 98-99, 101-104 (1926) (Mr. Williston:
"Either the promise is binding or it is not. If it is binding, it has to be enforced as
made
. . ."). These references are to the argument that ensued after a hypothetical
case was put in which Uncle promised Johnny $1000 to buy a new Ford car and
Johnny was able to obtain one for $500.
488
require the tenant to pay according to his bargain. It may reduce his
economic resources to make him keep his bargain, but this is not injus122
tice.
Gratuitous promises to secure insurance, to provide insurance, or
to file papers with reference to insurance policies present some of the
most difficult cases in which to determine whether the only way to
prevent injustice is to enforce the gratuitous promise. The three cases
of Brawn v. Lyford,"2 ' Spillane v. Yarmalowic' 24 and Comfort v.
McCorkle,2 5 may be taken as typical.
In the Brawn case the defendant promised to send a fire insurance
policy to the company so that it could be transferred to plaintiff, but
neglected to do so. When plaintiff's buildings were destroyed by fire
and he discovered that he was not protected by the policy, he sued
defendant in assumpsit to recover the amount of the insurance previously carried on the buildings, $1350. Recovery was denied. Recovery was also denied in the Spillane case where the defendant promised to have his policy of fire insurance changed to include plaintiff's
interest as mortgagee and plaintiff, relying on the promise, cancelled
an existing policy which covered his own interest. In the Comfort
case the defendant, a mortgagee, failed to file proofs of loss within
the time allowed, though he had promised mortgagor's agent to do so.
In each instance the promisor said he would do something. This statement caused the promisee to rely on it, as the promisor should have
expected, and to fail to protect his own interests, as he could have
done. Thus, in all these cases, the first two requirements of the doctrine of promissory estoppel are present. How about the third element
-avoidance of injustice to the promisee? Certainly, the promisee has
no remedy against the insurer; he has no contract of insurance with
it. Under the facts we are justified in assuming that the fire was a nonnegligent one, so there is no tort action available. Without question
the promisee has suffered serious economic loss. Can injustice be
avoided only by requiring the promisor to pay an amount equal to the
face of the policy which would have been effective had the promise
been kept?
The financial burden imposed on the promisor by enforcement
will bulk quite large in comparison with the monetary value of the
122. A few courts have permitted the tenant to escape further liability on payment
of the lesser sum, though for diverse reasons. Julian v. Gold, 214 Cal. 74, 3 P.2d 1009
(1932) (theory of completed gift) ; Liebrich v. Tyler State Bank & Trust Co., 100
S.W.2d 152 (Tex. Civ. App. 1937) (discovery of a bargained-for exchange, coupled
with economic depression); Lindeke Land Co. v. Kalman, 190 Minn. 601, 252 N.W,
650 (1934) (settlement of unforeseen contingencies) ; Ten Eyck v. Sleeper, 65 Minn.
413, 67 N.W. 1026 (1896) (unexpected change in economic conditions).
123. 103 Me. 362, 69 Atl. 544 (1907).
124. 252 Mass. 168, 147 N.E. 571 (1925).
125. 149 Misc. 826, 268 N.Y.S. 192 (1935).
489
services which were to have been performed by him. A reasonable fee

for filing proof of loss in the Comfort case would not have exceeded
twenty-five dollars; a sheet of paper, an envelope, some ink and a
postage stamp would have been the outlay necessary in the Brawn and
Spillane cases. In contrast the promisee seeks sums, equal to the insurance policies, 2 of more than one thousand dollars in each instance.
It may be that the great disparity between the reasonable value of the
performance by the promisor and the amount sought as damages was
what moved the courts of Maine, Massachusetts and New York to
refuse enforcement. Such a view, however, either overlooks the question of whether injustice to the promisee can be avoided only by
enforcing the promise or else decides that the hardship to the promisor
so far outweighs that to the promisee as to require non-enforcement.
Unless it can be said that the promisee was not entitled to rely
on the promise, only two alternatives are available here; either allow
plaintiff nothing, or give him the full amount that he seeks. Unfortunately, these three cases give him exactly nothing. Here there is no
possibility of restoring the status quo; the economic loss resulting from
justifiable reliance is readily determinable. Here the doctrine of promissory estoppel dictates recovery. Instead the decisions "stick in the
bark" of the bargain concept and refuse enforcement. This is particularly regrettable in the Comfort case for the attention of the New York
court was specifically called to Section 90 of the Restatement; the
court mistakenly said the Section was applicable only to charitable
2 7
subscriptions.1
Yet in the same jurisdiction (New York) the case of Siegel v.

Spear'2 8 allowed recovery on a gratuitous promise to insure that hap2 9
pened to be set in a context of bailment. Likewise, in New Jersey,'
on facts similar to Brawn v. Lyford, a cause of action in favor of the
promisee was created on a bailment theory. The enforcement of a
gratuitous promise to procure insurance has, however,
been rested
30
squarely on Section 90 by the Mississippi court.'
The latter cases are to be preferred by a court which is interested

in correcting an apparent injustice and hardship. They recognize the
126. Judgment for $1350 was sought in the Brawn case and for $2000 in the Spillane case. The opinion in the Comfort case does not reveal the sum allowed plaintiff
by the jury.
127. Comfort v. McCorkle, 149 Misc. 826, 268 N.Y.S. 192, 197 (1933) C"... We
are not unmindful of Section 90 of the Restatement of the Law of Contracts . .
But the New York Annotations thereto say: 'This section announces a rule of promissory estoppel applicable to charitable subscription.'").
128. 234 N.Y. 479, 138 N.E. 414 (1923). Accord, Schroeder v. Mauzy, 16 Cal.
App. 443, 118 Pac. 459 (1911).
129. First National Bank and Trust Co. v. Evans, 11 N.J. Misc. 19, 163 Atl. 667
(Sup. Ct. 1932).
130. Lusk-Harbison-jones, Inc. v. Universal Credit Co., 164 Miss. 693, 145 So.
623 (1933).
economic loss which has followed justifiable reliance on the promise

and place that loss on the one who has induced the reliance. Such a
decision has a strong ethical basis and appeal. Indeed, it has even
more of an appeal than do the land-gift cases, where it might be possible oftentimes to reimburse the promisee for the benefits he has conferred by improving the real estate instead of, as is customary,
conferring on him title to property worth far more than the improvements.
There are occasional instances where the courts have avoided
injustice to the promisee without enforcing the promise in its entirety.
Such a case is Terre Haute Brewing Co., Inc. v. Dugan,'3 ' where
defendant alleged that plaintiff promised him he would be given an
exclusive franchise to sell beer as long as he "wanted to put his time
to it." When the franchise was cancelled and plaintiff sued for goods
sold and delivered, defendant counterclaimed for loss of anticipated
profits. The court limited his recovery to the expenses he had incurred
but had not yet been able to recoup. A more recent case is Goodman
v. Dicker.'3 ' There a gratuitous promise to issue a "dealer's franchise"
and to make an initial shipment of thirty to forty radios induced the
promisee to incur expenses and solicit orders. Neither the franchise
nor the radios were forthcoming. In the trial court the promisee had
judgment for cash outlays and for loss of anticipated profits. The Court
of Appeals modified the judgment to eliminate the loss of profits but
allowed recovery for the expenditures made in reliance upon the
gratuitous promise.
Oddly enough, Section 90 was neither cited nor relied upon in
either of these cases. Yet these courts held the gratuitous promises
binding to the extent necessary to reimburse the promisees for their
expenditures made in reliance on the promise. Thus the cases fit into
the promissory estoppel category. To be noted is the fact that these
courts did not find themselves impelled to give specific enforcement of
the entire promise. They had precedents available in the cases dealing
with the problem of the revocation of the gratuitous license to use
land,"' where the decisions range all the way from denying the
creation of any rights in the licensee to holding that a permanent
easement has been created, 'Mbut with a goodly number protecting the
131. 102 F.2d 425 (8th Cir. 1939).
132. 169 F.2d 684 (D.C. Cir. 1948).
133. The leading American case is Rerick v. Kern, 14 Serg. & R. 267, 16 Am.
Dec. 497 (Pa. 1826).
134. Fuller and Perdue, The Relaiwe Element in Contract Damages: 2, 46 YALE
L.J. 373, 402 (1937) ; CLARK, REAL COVENANTS AND OTHER INTERESTS WHIcH "RUN
WITH LAND" 59-64 (2d ed. 1947), contains a full discussion of the better known cases.
promisee to the extent of his investment but no further. 1 35 Protection

to the extent of the expenditure made in reliance on the promise avoids
injustice to the promisee in the usual case and also tends to prevent
hardship on the promisor. 3 6 That protection is just as desirable to
one who has made expenditures preliminary to selling merchandise as
it is to one who has spent money to improve an access road across the
promisor's land. For this reason the decisions in the Terre Haute
Brewing Co. case and the Goodman case seem correct. These two cases
illustrate that it is possible for courts to do justice in a particular
case, protecting the reliance which is the essence of promissory estoppel, by partial enforcement.
The reason for the failure of more courts to adopt such a solution
in the promissory estoppel cases is, perhaps, to be found in the fact
that Section 90 of the Restatement fails to indicate the extent to
which the gratuitous promise is binding. The assumption seems to be
that "the usual contracts remedies and rules of damages will apply."' 3 7
Courts when faced with a request to enforce the entire promise may
believe that complete enforcement would work an injustice to the
promisor and deny any relief whatsoever. As a result patent injustice
is often done to the promisee. They might well give partial enforcement instead, thus vitalizing the concept of the avoidance of injustice.
The cases involving "business transactions" serve to indicate the
difficulties which the courts encounter in dealing with this problem
of injustice. An oft-cited opinion on this aspect of the doctrine is
James Baird Co. v. Gimbel Bros., Inc. 3 ' In that case plaintiff, a
Washington, D. C. contractor, was preparing to bid on the erection
of a public building at Harrisburg, Pa. The defendant, a New York
firm, submitted to plaintiff and all other contractors interested, a bid
for the linoleum required on the job, but it mistakenly underestimated
the yardage involved by about fifty percent. This bid was sent to those
interested on December 24th and provided, "If successful in being
awarded this contract, it will be absolutely guaranteed, ...
and... we
are offering these prices for reasonable [sic] prompt acceptance after
the general contract has been awarded." Plaintiff received a copy of the
bid on the twenty-eighth; on the same day defendant, Gimbel, learned
135. Flick v. Bell, 42 Pac. 813 (1895) (compensation must be made for licensee's
change of position). The privilege lasts as long as the natural life of the improvements either with or without repairs. Grinshaw v. Belcher, 88 Cal. 217, 26 Pac. 84
(1891) ; Wingard v. Tift, 24 Ga. 179 (1858) ; Clark v. Glidden, 60 Vt. 702, 15 Atl.
358 (1888).
136. Professor Alfred F. Conard, now of the University of Illinois, has the best
recent discussion of the license cases in his article, Unwritten Agreements for the
Use of Land, 14 Rocicy Mv. L. Rav. 153, 160, 294, 310 (1942).
137. Shattuck, Gratuitous Promises-A New Writ?, 35 MIcH. L. Rav. 908, 944
(1936).
138. 64 F.2d 344 (2d Cir. 1933).
492
of its mistake and telegraphed all contractors that the bid was withdrawn and a new one at about double the previous price would be
submitted. Plaintiff received the withdrawal after its bid, quoting
linoleum at the first Gimbel price, had been mailed to Harrisburg.
Plaintiff's bid was accepted by the public authorities on December
thirtieth. Plaintiff then, on January 2d, formally accepted the Gimbel
bid of December 24th. When Gimbel refused to recognize the existence
of a contract, plaintiff sued.
Recovery was sought on three grounds: (1) That there was an
offer of a unilateral contract which was accepted by including the
Gimbel price in the bid submitted to Harrisburg; (2) That defendant
should be bound by the doctrine of promissory estoppel and, (3) That
there was an option giving the plaintiff the right reasonably to accept
but not binding it to do so. The court, in an opinion by Learned
Hand, rejected all three contentions, and affirmed the judgment below
for defendant. The first contention, that there was an offer for a
unilateral contract was rejected13 because the words of the offer "for
prompt acceptance after the general contract has been awarded" demonstrated that defendant required acceptance by communication, rather
than an act, i.e., it sought a bilateral contract. The third ground,
that there was an option, was denied because "there is not the least
reason to suppose that the defendant meant to subject itself to such a
one-sided obligation." 40 And the contention that promissory estoppel
applied was denied because it can apply only to "a donative promise
... The doctrine of 'promissory estoppel' is to avoid the harsh results
of allowing the promisor in such a case (i.e., of a donative promise)
to repudiate, when the promisee has acted in reliance upon the
promise."
There is no need to reject the application of promissory estoppel
in commercial transactions. Certainly, there is no explicit restriction
of the doctrine to "donative" promises to be found in the words of
Section 90; neither is one justified in reading such an implication into
its language, though the New York Annotations to the Contracts
Restatement' 4' so intimate, and some New York courts so hold.' 42
Injustice can result where a gratuitous promise is given in connection
with a commercial transaction as easily as it can in the instance of a
139. Id. at 346.
140. Ibid.
141. RESTATEMENT, CONTRActs, N.Y. ANNoT., 90 (1933), Comment: "This section announces a rule of promissory estoppel, applicable to charitable subscriptions
promises to make gifts, etc."
142. Quincy & Co. Arbitrage Corp. v. Cities Service Co., 156 Misc. 83, 282 N.Y.S.
294 (Sup. Ct. 1935) ("The doctrine of promissory estoppel has been definitely limited
in this state to cases involving charitable subscriptions."). Comfort v. McCorkle, 149
Misc. 826, 831, 268 N.Y.S. 192 (Sup. Ct. 1933).
493
charitable subscription. A court should not ignore the injustice that

will result from non-enforcement of a gratuitous promise when clad
in business garments, but recognize it when found in other clothes.
The avoidance of injustice should be of prime concern, not just the
avoidance of some injustice.
Indeed, the Baird case furnishes an apt illustration of possible
injustice in an oft-recurring situation. As is well known, general contractors often solicit bids for portions of construction work from subcontractors. When such bids are received, the general contractor
incorporates them in his own bid and subjects himself to the possibility
of being required to perform his own contract (provided the general
bid is accepted) at the bid price or pay damages. If the subcontractor
"welshes," the general contractor suffers an economic loss equal to
the difference between the subcontractor's bid and the acutal cost of
completing that portion of the work. To call this loss "unjust" seems
proper, particularly where the subcontractor's bid induced the reliance
of the general contractor. The failure to use promissory estoppel (by
saying it does not apply to commercial situations) is both unnecessary
and unwise. The decisions in Robert Gordon, Inc. v. Ingersoll-Rand
Co.14 and Northwestern Engineering Co. v. Ellerman et al.,' 4 seem
preferable.
Both of these cases involved facts substantially the same as those
in the Baird case. In the Gordon case the Seventh Circuit expressly
refuted the reasoning of the Baird case, saying, "the mere fact that the
transaction is commercial in nature should not preclude the use of
promissory estoppel." 145 Recovery was denied, however, because
other requirements of the doctrine had not been met. The South
Dakota court in the Northwestern Engineering case also expressly
rejected the Baird reasoning, and, believing "that reason and justice
demand that the doctrine be applied," 148 gave affirmative relief.
The injustice to be avoided should not be restricted to economic
loss alone. If a church in reliance on subscriptions borrows money
to pay off its existing indebtedness and the subscriber then refuses to
pay, it is clear that the church is not in any worse financial condition
than it was before. All that it has done is to substitute a new debtor
for an old one. However, the church has been induced to change its
position by acquiring a new creditor. In at least two cases courts have
143. 117 F.2d 654 (7th Cir. 1941).
144. 69 S.D. 397, 10 N.W.2d 879 (1943); a second appeal, 71 S.D. 236, 23
N.W.2d 273 (1946), involved only the validity of instructions on the measure of damages, not promissory estoppel.
145. Robert Gordon, Inc. v. Ingersoll-Rand Co., 117 F.2d 654, 661 (7th Cir.
1941).
146. Northwestern Engineering Co. v. Ellerman, 69 S.D. 397, 10 N.W.2d 879,
884 (1943).
494
47
been willing to enforce a charitable subscription on this state of facts.
Financial hardship should not be the sole criterion. A loss of reputation and standing in the community that would cause far more harm
than economic loss should serve as equal motivation for enforcement.
The cases discussed herein illustrate the desirability and feasibility
of considering the avoidance of injustice as a separate element of the
doctrine of promissory estoppel. It is desirable because such a procedure insures a step-by-step analysis of the facts at hand which, in turn,
insures that the jurist will have the opportunity to weigh all of the
facts against specified requirements as well as an opportunity to study
the consequences which may follow his decision. Its feasibility has
been demonstrated by courts which have so considered it. The fact
that injustice may involve subjectivity in approach does not militate
against this method. Rather, it insures that the courts, because of their
awareness of the problem, will employ an objective approach to its
solution.
As has been seen, there are limitations and requirements inherent
in the avoidance of injustice, just as there are in connection with the
elements of foreseeability and reliance. The promisee must demonstrate the injustice he will suffer if the promise is not enforced; the
hardship to him must be evident. But the hardship and injustice should
not be restricted to economic loss nor solely to non-commercial transactions. If the avoidance of injustice is accepted, as it should be, as a
separate element and a third requirement of the doctrine of promissory
estoppel, the courts will be able to apply that doctrine with more discrimination and an awareness of the problems really presented for
decision when they are asked to enforce a gratuitous promise.
RETROSPECT AND PROPHECY
This paper began with a series of three questions said to be

implicit in the doctrine of promissory estoppel as expressed in Section
90 of the Contracts Restatement. Then followed an analysis of each
of these questions as well as discussion of the separate requirements
which this analysis disclosed. It will be well to end this consideration
of promissory estoppel with a summary of what has gone before as
well as with a prophecy as to the developments which are likely to
occur in the future application of the doctrine.
Unless there has been a promise which the promisor should
reasonably expect to induce action of a7 definite and substantial character on the part of the promisee, there is neither place nor need for
the employment of the doctrine of promissory estoppel. This promise,
147. Trustees v. Garvey, 53 Ill. 401 (1870).
v. Baird, 60 Iowa 237, 14 N.W. 303 (1882).
Accord: United Presbyterian Church
495
then is basic. Its existence is determined by the same tests which are
employed to determine the existence of a promise in other contract
situations. If there be a promise, it is subject to recall as are other
promises and its continued existence will be affected, as are offers, by
death or insanity of the promisor. A safeguard is provided by the use
of an objective test to determine whether a reasonable man would
foresee, as likely to result, the action induced by the promise. In
essence, in this first step in the analysis of promissory estoppel, the
sole concern is with determining the existence of a promise.
Once the existence of a promise is determined, the second requirement is considered. It is that the promise must have induced action
or forbearance of a definite and substantial nature. Here, too, there is
concern as to the foreseeability of the action actually taken in reliance
on the promise. Thus, again, there is an attempt at providing an
objective standard. But there is equal emphasis upon the reliance
induced by the promise. This emphasis is evidenced by the words
"definite and substantial character" which are used by the Restatement
to describe the type of action required to justify the employment of
the doctrine of promissory estoppel. Trivialities will not suffice; the
action taken must bulk large enough to justify the intervention of
the courts.
Given the promise and justifiable substantial action in reliance
on it, there is still a third requirement which musf be present before
Section 90 can apply. Now the concern is with whether it is possible
to avoid injustice in any way except by enforcement of the gratuitous
promise. If it is, there is no need to apply promissory estoppel. But
this can be determined only by a careful consideration of available
remedies, particularly those that will protect the restitution and reliance
interests of the promisee. If no other available remedy will avoid
injustice, then there is a strong ethical basis for enforcement; the
promise may be enforced. It is with this third element-the avoidance
of injustice-that it is most difficult to provide an objective standard
by which to determine the need for imposing contractual liability. At
the least, however, one can expect the courts to react much as would
the reasonable man under a similar state of facts.
A court which applies promissory estoppel, as analyzed above,
must break down the factual situation into its constituent elements,
then it must determine whether, in the case at hand, each of the three
requirements of promissory estoppel (the promise, the action-inreliance, and the need for avoiding injustice)' is present. If all three
requirements are present, the court will be justified in enforcing the
promise. Nothing less will meet the requirements of the doctrine as
it is formulated in Section 90 of the Contracts Restatement.
496
So much for retrospect, now as to prophecy. What difference in

interpretation or emphasis is likely to occur in the application of the
doctrine in the years ahead? As to the element of the "promise likely
to induce action," one would not expect to find any considerable
change, for the probabilities are that the courts will continue to determine whether or not a gratuitous promise has been expressed by the
same tests which are applied to determine the existence of other
promises. As to the elements "action of a definite and substantial
character" and "the avoidance of injustice," however, one may predict
a different course.
At present there is considerable leeway in determining the characteristics of the reliance necessary before courts will intervene to
enforce the gratuitous promise. No precise yardstick is now available
by which to measure the amount of action required. The only requirement is that the action be of a "definite and substantial character."
In effect, each case is judged on its own merits. Here the decisions
can go in either of two directions: towards the creation and application
of a rigid formula with which the reliance must comply, or in accordance with the present practice of handling cases individually and in
their own context. The probability of the former developing is remote.
One of the few attempts to create a formula-in the land-gift cases
by requiring that donee's expenditures exceed the rental value 4 ' failed. 14 9 There is no indication that similar future attempts would
be any more successful. Such a trend would be undesirable for it
would lead to automatic application of a rigid rule and would tend to
ignore the facts of particular cases. The requirement that the action
in reliance be both definite and substantial will sufficiently protect the
promisor as well as the promisee. Furthermore, the separate "injustice" requirement would seem to preclude the adoption of any rigid
formula.
There are limitations and requirements inherent in the avoidance
of injustice just as there are in connection with the elements of promise
and reliance. The promisee must demonstrate the injustice he will
suffer if the promise is not enforced; his hardship must be evident and
caused by his reliance. But since hardship is not restricted to noncommercial transactions, neither should enforcement be so restricted.
The chances are that it will not.' In addition, we can expect clarification of the kinds of remedies that will be made available to the prom148. Supra note 72.
149. Cases are cited supra note 73.
150. Supra notes 143-144. Cases in which courts have restricted promissory
estoppel to non-commercial transactions are listed in notes 161, 164, 165 mpra. See
also R. P. Farnsworth & Co. v. Albert, 79 F. Supp. 27 (E.D. La. 1948) (Defendant
sub-contractor's bid held irrevocable after award of general contract to plaintiff).
497
isee. There is no real need for the courts to restrict themselves to

giving only complete enforcement. It is to be hoped that the trend
Will be towards a protection of the relian6e interest of the promisee,
even though that may mean only restitution."' 1 In many cases, partial
enforcement will prevent injustice to the promisee without the injustice
to the promisor that is often patent when complete enforcement is
granted. If such a trend toward partial enforcement requires the development of a new writ, so be it.1 52
If the courts concentrate their
attention on the avoidance of injustice to a promisee who has acted

justifiably in reliance on a gratuitous promise, such a trend seems
inevitable.
In addition, we can expect an attempt on the part of some courts
to formalize the fact-situations which they will recognize as creating
injustice. While judicial recognition of hardship and injustice as a
reason for enforcing a gratuitous promise is necessary if promissory
estoppel is to develop and mature, formalization or the confining of
its use to a few specific situations is neither necessary nor desirable.
Should that occur, promissory estoppel would become as mechanical
as the jurisprudence of which Pound once complained.' 55 Rather, it
is to be hoped that fluidity irthe application of the concept will be
maintained so that injustice may be avoided whenever it is encountered
in connection with the gratuitous promises here discussed.
The doctrine of promissory estoppel does not purport to enforce
all gratuitous promises. Only those promises which ard likely to and
have induced reliance of a substantial character are within the scope
of the present doctrine, and then only when the need to avoid injustice
demands their inclusion."5 4 When the limitations and requirements
of the doctrine, as discussed herein, are recognized, it is clear that
it stands midway between those promises which have been bought and
paid for with a price and those which are purely gratuitous. Purely
gratuitous promises are not now enforced in the Anglo-American
legal system.' 5 5 It is unlikely that they will be, as is indicated by the
151. See notes 131-33, 135, 137 supra.
152. Shattuck, Gratuitous Promises-A New Writ?, 35 MIcE. L. REv. 908, 941945 (1937).
153. Pound, Mechanical Jurisprudence, 8 COL. L. REv. 605, 606 (1908): "The
effect of all system is apt to be petrifaction of the subject systematized. Perfection
of scientific system and exposition tends to cut off individual initiative in the future,
to stifle independent consideration of new problems and of new phases of old problems,
and to impose the ideas of one generation upon another."
154. 4 PROCEEDINGS A.L.I., APP. 93, 97, 98 (1926).
155. CORBIN'S ANSON 119: "We find at the outset that bare words of promise
do not so operate [to create legal rights and duties]"; 121: "In each case we must
ask, Was anything given in exchange for the promise as itsagreed equivalent? If
not, the promise is gratuitous, and is not binding unless it is within the exceptions
discussed hereafter. WILLISTON 112: ". ., . A would not be liable on his promise because it was gratuitous."; 116: "..
. Nor has the law as yet generally accepted the principle that reliance on a gratuitous promise makes the promise binding,
498
failure of any sizeable number of states to adopt the Uniform Written

Obligations Act.' 5 6 The consideration which is present when the
promise is bought and paid for is apt to continue to furnish the justification for the majority of the promises which courts enforce, if only
because people will continue to bargain for most of the promises they
give.15 7 To promissory estoppel, then, is to be left the gap between
the mere promise and the bargain. In this gap the doctrine can operate
rationally, logically and usefully as a means of protecting justifiable
reliance and avoiding injustice.
although the modern doctrine of promissory estoppel has extended legal recognition
to such promises where the promisee has incurred a substantial detriment which
the promisor should reasonably have anticipated as a consequence of the promise."
GRISMORE 53: "As a general rule, an informal promise is not per se enforcible in our
lav even though it has been assented to by the promisee." RESTATEMENT 85-94, recognizes five instance in which a .promise is enforced though not supported by conventional consideration. They are: (1) Promise to pay debt barred by Statute of Limitations ( 86), (2) Promise to pay debt discharged in Bankruptcy ( 87), (3) Promise to perform a voidable duty, (4) Stipulations ( 94) and, (5) Promissory Estoppel.
156. 9 U.L.A. 431. The Uniform Written Obligations Act was approved by the
National Conference of Commissioners on Uniform State Laws in 1925. It was
adopted in Pennsylvania in 1927, PA. STAT. ANN. (Purdon, 1949) tit. 33 6-8, and
in Utah in 1929, Utah Laws 1929, c. 62, . . . but was later repealed, UTAH CODE
ANN. tit. 88 1-2 (1943)) (a fact which apparently has not been noted by the editors of Contracts casebooks). The attempts to solve the problem by making "firm
offers" irrevocable when in writing (N.Y. PERS. PROP. LAW 33(5), and N.Y. REAL
PROP. LAW 279(4)) fail to cover the entire field of gratuitous promises. In the first
place the New York statute applies only to offers, not to all promises. In the second
place, it does not apply to oral offers which may induce as much reliance as written
ones. See Hays, Formal Contracts and Consideration-A Legislative Program, 41
COL. L. REv. 849 (1941). See also LAW REvisioN CoMMIssIoN OF NEW YORK, REPORT,
RECO MNDATIONS AND STUDIES 345-414 (1941), for extended discussion of rationale
of this legislation. For similar provisions as to "firm" offers by a merchant to buy
and sell goods, see UNIFORm COMMFRCrAL CODE 2-205 (May 1949 Draft).
157. FULLER, THE PROBLEMS OF JURISPRUDENcE 710 (1941).

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University of Pennsylvania

American Law Register

PROMISSORY ESTOPPEL: REQUIREMENTS AND

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

elements number three.

They can be phrased as separate questions

(1) Was there a promise which the promisor should reasonably

708 (1931) for other definitions.

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS

PROMISE LIKELY To INDUCE ACTION

If one begins thus, he will realize that he must first determine

And conformance to advice is never intended to stand as legal consideration

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS

makes him responsible only for those consequences which he should

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS

of lands preliminary to acceptance of an offer,2" or if the consignor

action or forbearance of a definite and substantial

nature on the part of the promisee . .

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

TERMINATION OF PROMISEE'S POWER TO BIND PROMISOR

It is hornbook law that an offer may be revoked by the offeror

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS 467

of offers of unilateral contracts requiring time for performance" 7

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

A number of cases hold that the death of the subscriber to a

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS

on the promise and without knowledge of the promisor's death,

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

Just as the preceding section opened with a question, so does

L.J. 52, 84-85 (1936).

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS 471

vention by the court. Absent such cause-effect relationship there

(didn't build on the strength of

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

Particularly where the promisor expressly withdraws his promise

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS 473

35(1): "An offer may be terminated by (e) revocation by

the offeror." 41: "Revocation of an offer may be made by a communication from

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

It should be clear by now that if the gratuitous promise does not

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS

enough." Neither is the making of improvements of a "temporary

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

To this point we have considered instances in which the promise

makes improvements in reliance on the mortgagee's promise to refrain

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS 477

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

In these instances the result produced could be demonstrated by

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS 479

requirement that one certain, specific action necessarily be foreseen

As formulated by the American Law Institute promissory estoppel

Just as a person who induces one to take action of a particular

UNIVERSITY OF PENNSYLVANIA LAW REVIEW

contractual liability as one which induces "action or forbearance of a

PROMISSORY ESTOPPEL: REQUIREMENTS AND LIMITATIONS

of the promise.' 0 Argument might be made as to the soundness of