Opinion
No. C1-00-1677.
Filed March 6, 2001.
Appeal from the District Court, Hennepin County, File No. CT996621.
Richard E. Bosse, Law Offices of Richard E. Bosse, Chartered, (for appellants)
Paul L. Ratelle, Richard G. Jensen, Julie A. Doherty, (for respondents)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2000).
UNPUBLISHED OPINION
Appellants Dean Hughes, Dallas Knight, and Hughes Knight Corporation sued respondents John Coyne and Coyne's Company, Inc. alleging fraud, breach of contract, and promissory estoppel. The district court granted summary judgment to respondents, based on its conclusion that there were no genuine issues of material fact and that respondents were entitled as a matter of law to judgment. Appellants only challenge the grant of summary judgment on the issue of promissory estoppel. Because the evidence does not demonstrate a sufficiently definite promise or reasonable reliance so as to invoke promissory estoppel, we affirm.
DECISION
"On an appeal from summary judgment, we must examine two questions, whether there are any genuine issues of material fact and whether the lower courts erred in their application of the law." Cummings v. Koehnen, 568 N.W.2d 418, 420 (Minn. 1997) (citation omitted). "A reviewing court must view evidence in the light most favorable to the party against whom summary judgment was granted." Vetter v. Security Continental Ins. Co., 567 N.W.2d 516, 520 (Minn. 1997) (citation omitted). No genuine issue of material fact exists "[w]here the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party." DLH, Inc. v. Russ, 566 N.W.2d 60, 69 (Minn. 1997) (citation omitted). A genuine issue for trial must be established by substantial evidence. Id. at 69-70.
Promissory estoppel is an equitable doctrine that implies the existence of a contract where, in fact, no contract exists. Ruud v. Great Plains Supply, Inc., 526 N.W.2d 369, 372 (Minn. 1995). Three elements are necessary to support such a claim: (1) a clear and definite promise; (2) an intention by the promisor to induce reliance, and actual and reasonable reliance by the promisee; and (3) the necessity to enforce the promise to prevent an injustice. Id.
A clear and definite promise is one that is unambiguous. See Faimon v. Winona State Univ., 540 N.W.2d 879, 882 (Minn.App. 1995), review denied (Minn. Feb. 9, 1996). Hughes Knight is relying on statements from a conversation with Coyne. According to the deposition of Dean Hughes, Coyne claimed that there were orders of $250,000 open for 1995 and that Coyne felt they could do between "three-quarters of a million and a million dollars" the next year. Hughes also testified that he asked Coyne for a contract and Coyne stated that he had never had a contractual arrangement with the prior owner. Coyne did agree in a September 5, 1995 "letter of intent" to turn over open orders for 1995, but there was no mention of orders beyond 1995, other than a vague wish for a "long and prosperous future." This does not create a clear and definite promise. See id. (finding university's statement to non-tenured faculty member regarding change in her position, that "[i]f a tenure track position should be approved, it would not be before 1994-95" was sufficiently unambiguous to be clear promise); cf. Ruud, 526 N.W.2d at 370-72 (holding employer's statements that "[g]ood employees are taken care of" and "[y]ou are considered a good employee," along with assurance that if job transfer did not work out, "similar" position would be offered, were too vague and indefinite to support claim for continued employment.) Coyne's statements in this case are more like those in Ruud and are thus too indefinite to create an enforceable promise.
The second element of a promissory estoppel claim is that the promisee acted or failed to act in reasonable reliance on the promise. Restatement (Second) of Contracts § 90(1) (1981). Generally, the question of reasonableness is a fact question for the jury. Faimon, 540 N.W.2d at 882. However, if the record is "devoid of any facts which would support a conclusion that * * * reliance was reasonable," there is no fact question. Nicollet Restoration, Inc. v. City of St. Paul, 533 N.W.2d 845, 848 (Minn. 1995). The court in Nicollet found that appellant's reliance on the promises of the mayor and an aide to submit proposals to the city council was not reasonable, given that the proposals would not have bound the council to any particular action. Id.
Coyne's statement that he foresaw doing three-quarters to one million dollars worth of business in 1996 was not supported by any reference to specific orders. Hughes testified that Coyne did not state why he thought Hughes Knight could achieve that level of earning, but agreed that he apparently based it on "what we've seen in 1995, that's what he believed." Appellants' reliance on apparently groundless assertions is not reasonable.
The third element of promissory estoppel, that enforcement of a promise is necessary when injustice can only be avoided by enforcement, is a question of law for the court. Faimon, 540 N.W.2d at 883. The determination is made by weighing "the reasonableness of a promisee's reliance and * * * public policies in favor of both enforcing bargains and preventing unjust enrichment." Id. In Faimon, the court found that although Faimon had proved the first two prongs of promissory estoppel, she had failed to show any injustice. In Faimon's case, although her employer had made statements reassuring her about the continuing nature of her job, she had not been unconditionally re-hired or promised a new contract; nor had she been discouraged from looking for other jobs. Id. Both parties understood that the university would be within its rights to hire another. Id. Likewise, while Coyne may have talked favorably and expansively about future relations between the two companies, no firm commitment was ever made and Hughes Knight was not bound, or even encouraged, to limit itself to sales to Coyne.
Even viewing the evidence in a light most favorable to appellants, as we must, we conclude that the district court did not err in granting summary judgment to respondents.