## Facts

- Pop’s Cones, Inc. operated a TCBY frozen-yogurt franchise in Margate, New Jersey, from 1991 to 1994 and explored relocating to retail space at Resorts’ Atlantic City casino hotel.
- Resorts’ business development executive discussed several potential locations and conveyed strong interest in having Pop’s as a tenant; Resorts permitted Pop’s to operate a vending cart during summer 1994 to test sales.
- Pop’s submitted a lease proposal in August 1994 and sought confirmation because it had to decide by October 1, 1994 whether to renew its Margate lease.
- In late September 1994, Resorts’ executive allegedly stated the deal was “95% there,” that only a signature remained, and that Pop’s should “pack up the Margate store and plan on moving.”
- Relying on these statements, Pop’s declined to renew its Margate lease, vacated, stored equipment, retained counsel, and undertook relocation planning.
- Resorts later provided draft lease materials and a December 1994 offer letter stating it was “not intended to be binding,” continued discussions, then withdrew the offer in January 1995.
- Pop’s former location had been re-let; Pop’s did not reopen until July 1995 and claimed lost business from the interruption.

## Issues

1. Whether Pop’s produced sufficient evidence of promissory estoppel to survive summary judgment based on Resorts’ pre-contract statements during lease negotiations.
2. Whether the “clear and definite promise” element may be satisfied, or treated more flexibly, where the promisor’s assurances foreseeably induce reliance before final contract terms are set.
3. Whether a later non-binding written offer precludes a promissory estoppel claim based on earlier representations and reliance.

## Decision

- The Appellate Division reversed the grant of summary judgment to Resorts and remanded for further proceedings.
- Viewing the record with favorable inferences to Pop’s, a reasonable jury could find that Resorts made assurances intended, and reasonably expected, to induce Pop’s reliance.
- A reasonable jury could also find Pop’s reliance was foreseeable and detrimental given Resorts’ knowledge of Pop’s lease-renewal deadline and Pop’s resulting loss of its existing site and business interruption.
- The court held that the non-binding language in a later writing did not, as a matter of law, defeat a promissory estoppel claim premised on earlier representations and reliance-based relief.

## Legal Principles

- Promissory estoppel follows Restatement (Second) of Contracts § 90: a promise that the promisor should reasonably expect to induce action or forbearance, that does induce such action or forbearance, is enforceable to the extent necessary to avoid injustice.
- New Jersey’s formulation commonly requires: (1) a clear and definite promise; (2) expectation of reliance; (3) reasonable reliance; and (4) enforcement necessary to avoid injustice.
- In pre-contract negotiation settings, the “clear and definite promise” requirement may be applied less rigidly when the promisor’s words and conduct could reasonably be understood as assurances that invite reliance.
- A disclaimer that a proposed writing is non-binding may defeat contract formation, but it does not necessarily bar a separate promissory estoppel claim seeking reliance damages based on earlier inducements.
- Promissory estoppel remedies are generally reliance-based rather than full expectation recovery, focusing on losses caused by the induced change in position.

## Conclusion

The court held that Pop’s presented enough evidence for a jury to decide whether Resorts’ assurances during lease negotiations foreseeably induced Pop’s to abandon its existing lease and suffer losses, making summary dismissal of the promissory estoppel claim improper despite the absence of a finalized, binding lease.


Pop’s Cones, Inc. v. Resorts Int’l Hotel, Inc., 307 N.J. Super. 461, 704 A.2d 1321 (App. Div. 1998)