2 ms·

Promissory estoppel actually applies even when the parties have not signed a contract — it’s based on the ‘promise’ that was made by one party, even in the abse

Promissory estoppel actually applies even when the parties have not signed a contract — it’s based on the ‘promise’ that was made by one party, even in the absence of a binding contract. It does require, as you say, ‘detrimental reliance’ to be triggered. In this case, that should be fairly easy to demonstrate, since anyone who left their job would have done so in reliance on the promise of employment.

deleted 3y ago
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seoulbigchris 3y ago
This. Once in my career I encountered something similar. The first interesting thing I learned about promissory estoppel was that it wasn’t really “law” but rather a legal concept. As such, things are a bit more vague than the typical legal dispute. Secondly, the lawyer told me that it was only possible to take that route if one had not officially signed an employment contract. The reasoning is that once you’ve signed a contract, you’re technically an employee and your claim would be handled in a different manner. But in many jurisdictions, the wronged person would be treated as having been fired at will and would not have much recourse (as opposed to a promissory estoppel claim) The other concepts in play were common sense things, like the company had to made you a reasonable offer, you took reasonable actions based on that promise, and the company knew you were taking those actions. And finally, the “penalty” is often only the documented losses you really incurred which can seem tiny in comparison to the situation and intangible losses. I suspect many of these cases are settled before going to court. IANAL and YMMV
refurb 3y ago
It's been a while since i did the "law for business people" class. You're right, promissory estoppel applies to arrangements made on the anticipation of a contract or more formal agreement. The courts recognize that it's not unreasonable that people do things on the promise of some future agreement. As the other comment notes, such a claim must pass a number of tests with regards to the reasonableness of actions, the beliefs of both parties at the time the actions are taken, etc.

deleted 3y ago

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seoulbigchris 3y ago

This. Once in my career I encountered something similar. The first interesting thing I learned about promissory estoppel was that it wasn’t really “law” but rather a legal concept. As such, things are a bit more vague than the typical legal dispute. Secondly, the lawyer told me that it was only possible to take that route if one had not officially signed an employment contract. The reasoning is that once you’ve signed a contract, you’re technically an employee and your claim would be handled in a different manner. But in many jurisdictions, the wronged person would be treated as having been fired at will and would not have much recourse (as opposed to a promissory estoppel claim) The other concepts in play were common sense things, like the company had to made you a reasonable offer, you took reasonable actions based on that promise, and the company knew you were taking those actions. And finally, the “penalty” is often only the documented losses you really incurred which can seem tiny in comparison to the situation and intangible losses. I suspect many of these cases are settled before going to court. IANAL and YMMV

refurb 3y ago

It's been a while since i did the "law for business people" class. You're right, promissory estoppel applies to arrangements made on the anticipation of a contract or more formal agreement. The courts recognize that it's not unreasonable that people do things on the promise of some future agreement. As the other comment notes, such a claim must pass a number of tests with regards to the reasonableness of actions, the beliefs of both parties at the time the actions are taken, etc.