## Facts

- William M. Coley negotiated with Robert L. Lang to acquire all stock of International Aerospace Services, Inc. (IAS), primarily to obtain the corporate name and goodwill for bidding on government contracts.
- Counsel drafted a letter dated September 1, 1972, signed by both parties, stating it “express[ed] the agreement” reached that day.
- The letter set a $60,000 price payable in installments and stated the transaction was subject to required corporate approvals (board and stockholders).
- The letter also provided that by September 18, 1972, the letter would be “reduced to a definitive agreement binding upon all of the parties” and accomplishing the contemplated sale.
- Necessary conditions and approvals were not obtained by the contemplated timeframe, and Coley informed Lang the transaction would not proceed and withdrew.
- Lang claimed he relied on Coley’s commitment by foregoing business opportunities, including not bidding on two contracts, and sought damages for lost profits.
- After an ore tenus hearing, the trial court denied specific performance but awarded Lang $7,500 based on reliance on Coley’s representation that he would purchase the stock.

## Issues

1. Whether the September 1, 1972 letter constituted a binding contract obligating Coley to purchase IAS stock.
2. Whether the $7,500 award could be upheld on promissory estoppel or reliance-on-a-promise principles despite the absence of an enforceable contract.

## Decision

- The appellate court held the letter was not an enforceable stock-purchase contract because it contemplated later execution of a definitive agreement and remained subject to approvals and conditions.
- The court held the reliance award could not be sustained on promissory estoppel in this context; the doctrine did not authorize affirmative damages where no contract existed.
- The court also noted the claimed lost-profit damages were uncertain and speculative on the record presented.
- The judgment awarding $7,500 to Lang was reversed, and judgment was rendered for Coley.

## Legal Principles

- A signed preliminary writing that anticipates a later “definitive agreement” and conditions performance on additional approvals may be treated as a nonbinding agreement to agree rather than an enforceable contract.
- The ore tenus presumption protects factual findings based on oral testimony, but it does not control legal questions such as interpretation of an unambiguous written instrument or the availability of an estoppel-based claim.
- In this setting, promissory estoppel did not operate as an affirmative cause of action for money damages absent a binding contract.
- Reliance or lost-profit claims must be supported by non-speculative proof; uncertain damages provide an additional basis to deny recovery.

## Conclusion

The court concluded that the parties’ letter was a conditional, preliminary commitment to negotiate and execute a later definitive stock-sale agreement, not a binding contract, and it rejected reliance damages because promissory estoppel did not supply an affirmative damages remedy on these facts and the claimed losses were insufficiently certain.


Coley v. Lang, 339 So. 2d 70 (Ala. Civ. App. 1976)