Facts
- Elizabeth M. Stewart, a vice president of sales at Cendant Mobility Services Corporation, worked under an at-will employment relationship.
- After a corporate reorganization in April 1998, Cendant terminated Stewart’s husband, who was also a Cendant employee.
- Stewart told her supervisor, the executive vice president of sales, that she feared her job could be affected if her husband took work with a competitor.
- Stewart’s supervisor assured her that her husband’s employment with a competitor would not affect her employment, told her she had nothing to worry about, and conveyed similar assurances attributed to Cendant’s president.
- Stewart testified she relied on these assurances by remaining at Cendant rather than pursuing other employment opportunities that she believed were available to her.
- On March 5, 1999, Cendant learned Stewart’s husband was working for a competitor and then limited Stewart’s duties and sought her signature on an agreement addressing obligations tied to her husband’s competitor work.
- Stewart refused to sign; Cendant terminated her on June 11, 1999.
- At termination, Stewart claimed she was owed approximately $812,700 in unpaid commissions.
- A jury found for Stewart on promissory estoppel and negligent misrepresentation and awarded $850,000; the trial court entered judgment and denied Cendant’s postverdict motions challenging the sufficiency of the evidence.
Issues
- Whether the supervisor’s assurances that Stewart’s employment would not be affected by her husband’s competitor employment constituted a clear and definite promise sufficient for promissory estoppel despite at-will employment.
- Whether the evidence permitted a finding that Stewart reasonably relied on the assurances to her detriment by forgoing other employment and suffering measurable financial harm.
Decision
- The Connecticut Supreme Court affirmed the judgment for Stewart.
- The court held the jury reasonably could find a clear and definite promise for promissory estoppel purposes, even if the statements did not constitute a contractual offer or modify at-will employment by contract.
- The court held the evidence was sufficient for the jury to find reasonable reliance and resulting detriment.
- Because the $850,000 award was sustainable on promissory estoppel alone, the court did not reach Cendant’s challenge to the negligent misrepresentation verdict.
Legal Principles
- Promissory estoppel requires (1) a clear and definite promise, (2) reliance by the promisee, and (3) detriment caused by that reliance.
- A promise may be enforceable under promissory estoppel even if it lacks the specificity required for contract formation and does not amount to an offer.
- At-will employment does not categorically bar promissory estoppel liability where an employer makes specific assurances about a particular ground for termination and the employee reasonably relies on them.
- A jury may find no enforceable contract while still finding an enforceable promise under promissory estoppel, because the doctrines protect different interests.
Conclusion
The court upheld a substantial reliance-based recovery where an at-will employee presented evidence that a supervisor gave specific assurances that her spouse’s competitor employment would not jeopardize her job, she stayed with the employer in reliance on those assurances, and she was later terminated after the assurances proved false.