Promissory estoppel is a doctrine that allows a party (the promisee) to recover based on a promise made by another party (the promisor), even in the absence of a formal contract, when the promisee has reasonably and detrimentally relied on that promise.

Essential Elements for a Promissory Estoppel Claim

To establish a promissory estoppel claim, the following key elements must be present:

• Clear and Unambiguous Promise: The promise should be specific enough to reasonably induce the promisee to act or refrain from acting.
• Actual and Reasonable Reliance: The promisee must have genuinely relied on the promise in a manner that is considered reasonable under the given circumstances.
• Detrimental Reliance: The promisee should have suffered a detriment, loss, or disadvantage as a direct result of relying on the promise. Note that this detriment need not necessarily be financial; it can also include loss of time, effort, or missed opportunities.
• Necessity of Enforcement to Prevent Injustice: It must be evident that enforcing the promise is essential to prevent an unjust outcome to the promisee.

Promissory Estoppel and the Statute of Frauds

Promissory estoppel is often invoked in cases of promises or agreements that are technically unenforceable due to noncompliance with the statute of frauds. The statute of frauds requires certain types of contracts to be in writing to be legally enforceable. This includes contracts for the sale of land, agreements that cannot be performed within one year, and promises to pay someone else's debts, among others. For instance, if a buyer relies on a seller’s verbal promise to sell the property and incurs significant expenses in preparation for the transfer, the court may enforce it despite the lack of a written contract. 

Example: Mark verbally promises to sell a small parcel of his land to his neighbor, Jane, for a significantly reduced price. Trusting Mark's promise, Jane hires a surveyor and an architect to plan a home on the land, incurring substantial costs. However, Mark later decides not to sell the land. Despite the lack of a written contract, which is typically required under the statute of frauds for real estate transactions, Jane might successfully claim promissory estoppel. Her reliance on Mark's verbal promise, and the significant expenses she incurred as a result, could lead the court to enforce the promise to sell the land.

Promissory Estoppel and the Lack of Contractual Consideration 

Another common application of promissory estoppel arises when an agreement or contract is not supported by consideration. Consideration is a fundamental element of a valid contract, and requires that each party act (or promise to act), or refrain from acting (or promise to refrain from acting), to their detriment. While the absence of consideration generally renders an agreement legally unenforceable, promissory estoppel can serve as an exception to this rule where one party has acted to their detriment based on a promise or assurance made by another party. 

Example: Larry promises to reimburse his daughter Sara for her college tuition and any living expenses she incurs while attending college. Relying on this promise, Sara makes the tuition payments and pays for her living expenses out of her own savings. However, Larry later refuses to reimburse her for these expenses, claiming that his promises were unenforceable due to lack of consideration. Since Sara relied on Larry’s promise to her detriment, she should be able to sue Larry for breach of contract under the doctrine of promissory estoppel.