Disclaimers & Promissory Estoppel

Dave Hoffman

Dave Hoffman is the Murray Shusterman Professor of Transactional and Business Law at Temple Law School. He specializes in law and psychology, contracts, and quantitative analysis of civil procedure. He currently teaches contracts, civil procedure, corporations, and law and economics.

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6 Responses

  1. Just a quick question: did any of the cases you looked at, particularly those you think cut against Salaita’s claim, involve a situation in which the condition necessary for the offer of employment to be valid was scheduled to take place after the offeree was scheduled to begin work? Lubet claims that there is no evidence that the Board’s decision was merely pro forma, but he completely ignores that, by Chancellor Wise’s own admission, Salaita’s classes were scheduled to begin in August but the Board was not going to meet to approve his appointment until September.

    • Stash says:

      That fact is indeed troubling. At best, it forces offerees to act at their peril and seems to me a very stupid and unfair way to approve candidates.

      But at the end of the day, I don’t think this translates into an enforceable custom or expectation that trustee approval is pro forma. As they say, this proves too much, because then, engaging in this custom, as the trustees would have a right to do, would mean that anybody hired who is disapproved per statute has a claim, thereby eliminating the statutory authority of the trustees.They don’t have the authority to repeal their authority. It’s a statute and can’t just be swept off the books by custom. In other words, customarily deferring to the administration’s judgment can do nothing to eliminate the fact that the offer is conditional and cannot be relied upon, else the statute is a dead letter.

      However obscure the law, generally one is not allowed to reasonably rely on something contrary to it unless it is a lawyer giving advice, in which case you can sue the lawyer, or negate your intent to violate it. There are constitutional issues regarding selective enforcement, but it would a separate claim.

  2. Steven Lubet says:

    Dorf relies on Newton Tractor Sales v. Kubota Tractor Corp for the proposition that Illinois recognizes promissory estoppel as a cause of action, which is true enough. But the existence of a cause of action does not mean that plaintiffs always win. The Newton Tractor ruling itself did nothing more than reverse a summary judgment in favor of the defendant, while remanding the matter for trial. As every litigator knows, there is a lot of territory between avoiding summary judgment — in which the facts are viewed in the light most favorable to the non-moving party — and winning the case. The difference is that trials require actual proof, and not merely well pled allegations. Dorf says that Salaita’s case is “relatively easy,” but it would be much more accurate to say — as far as promissory estoppel is concerned — that it probably would not be dismissed at the pleading stage.

  3. dave hoffman says:

    On the question you asked: no, none of the cases are exactly like this one, though several of them state explicitly that assurances that later approval is a “rubber stamp” doesn’t mean reliance on an unauthorized promise is reasonable. I understand your argument, but it seems to me to cut both ways. Salaita *knew* that the meeting wasn’t scheduled till September. Doesn’t that suggest that the reasonable course (which apparently many people undertake at Big 10 schools) was to take a leave from W&M for a year, or even a semester? Most laterals I know don’t submit their resignation until trustee authority comes through for just this reason.

  4. Bloix says:

    You cite Haviland v. Simmons as a case in which a plaintiff asserted a PE claim even though “ultimate authority lay with the Board of Trustees.” But the key fact in Haviland was that the plaintiff’s promised deal did not include tenure, and therefore it did not require approval of the trustees. If tenure had been at issue, the court implies, the result would have been different. The import of the PE analysis in Haviland is at best ambiguous and arguably cuts against Salaita.

  5. Stash says:

    Something closer, or perhaps another issue is that in Illinois there is no “apparent authority” that can be attributed to government actors, and it is the responsibility of the would-be plaintiff to ascertain it before acting in reliance thereon. Patrick Engineering, Inc. v. City of Naperville , 2012 IL 113148. In this case, a city official told an engineering firm to go ahead with additional work with a six-figure price tag. The Illinois Supreme Court told the firm to at least go back and plead on information and belief that there was actual authority or the firm was SOL. I think this means that the statute is dispositive on the agency issue in this case, no matter what otherwise could have been reasonably believed. Note this was a pleading case, so unless it can be alleged at the pleading stage that there was reliance on an agent with actual authority to make the offer/representation, it would not get past a motion to dismiss or judgment on the pleadings.

    The case also states in dicta that even where estoppel is asserted on the basis of the word of an authorized agent, it will not be enforced except in “egregious cases.” What the rule is with respect to the state itself I do not know, nor do I know what is required for an “egregious case” or if there has ever been one.

    Plaintiff would probably also need to plead facts showing that this is an “egregious” case. The political angle might do, but my suspicion (that I have not confirmed through research) is that it is more likely about cases that approach intentional deception or oppression, and that a trip to the Illinois Supreme Court could be necessary to resolve this.