Part V Enforceability in the Absence of a Contract

Part VPart V

Enforceability in the Enforceability in the Absence of a ContractAbsence of a Contract

R2 § 90: Promissory EstoppelR2 § 90: Promissory Estoppel

(1)(1) A promiseA promise which the which the promisor shouldpromisor should reasonably reasonably expect to induce action or forbearanceexpect to induce action or forbearance on the part of on the part of the promisee or a third person and which the promisee or a third person and which does induce does induce such action or forbearancesuch action or forbearance is binding if is binding if injustice can injustice can be avoided only by enforcement of the promisebe avoided only by enforcement of the promise. The . The remedy granted for breach may be limited as justice remedy granted for breach may be limited as justice requires.requires.

(2)(2) A charitable subscription or a marriage settlement is A charitable subscription or a marriage settlement is binding under Subsection (1) without proof that the binding under Subsection (1) without proof that the promise induced action or forbearance.promise induced action or forbearance.

R2 § 139(1): Promissory EstoppelR2 § 139(1): Promissory Estoppel

A promise which the promisor should reasonably expect A promise which the promisor should reasonably expect to induce action or forbearance on the part of the to induce action or forbearance on the part of the promisee or a third person and which does induce the promisee or a third person and which does induce the action or forbearance is enforceable action or forbearance is enforceable notwithstanding notwithstanding the Statute of Fraudsthe Statute of Frauds if injustice can be avoided only if injustice can be avoided only by enforcement of the promise. The remedy granted for by enforcement of the promise. The remedy granted for breach is to be limited as justice requires.breach is to be limited as justice requires.

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R2 § 139(2): Avoiding InjusticeR2 § 139(2): Avoiding Injustice

In determining whether injustice can be avoided only by enforcement of the In determining whether injustice can be avoided only by enforcement of the promise, the following circumstances are significant:promise, the following circumstances are significant:

(a) the availability and adequacy of(a) the availability and adequacy of other remedies other remedies, particularly , particularly cancellation and restitution;cancellation and restitution;

(b) the (b) the definite and substantial character of the action or definite and substantial character of the action or forbearanceforbearance in relation to the remedy sought; in relation to the remedy sought;

(c) the extent to which the action or forbearance corroborates (c) the extent to which the action or forbearance corroborates evidence of the making and terms of the promiseevidence of the making and terms of the promise, or the making , or the making and terms are otherwise established by clear and convincing and terms are otherwise established by clear and convincing evidence;evidence;

(d) the (d) the reasonablenessreasonableness of the action or forbearance; of the action or forbearance;

(e) the extent to which the action or forbearance was (e) the extent to which the action or forbearance was foreseeableforeseeable by by the promisor.the promisor.

R2 § 139. Enforcement by Virtue of R2 § 139. Enforcement by Virtue of Action in RelianceAction in Reliance

CommentComment

a. Relation to other rules.a. Relation to other rules. This Section is complementary to § This Section is complementary to § 90, which dispenses with the requirement of consideration if 90, which dispenses with the requirement of consideration if the same conditions are met, but it also applies to promises the same conditions are met, but it also applies to promises supported by consideration. Like § 90, this Section … states supported by consideration. Like § 90, this Section … states a basic principle which sometimes renders inquiry unto the a basic principle which sometimes renders inquiry unto the extent to which reliance furnishes a compelling substantive extent to which reliance furnishes a compelling substantive basis for relief in addition to the expectations created by the basis for relief in addition to the expectations created by the promise or to the extent to which the necessary as to the promise or to the extent to which the necessary as to the precise scope of other policies....precise scope of other policies....

R2 § 139. Enforcement by Virtue of R2 § 139. Enforcement by Virtue of Action in RelianceAction in Reliance

CommentComment

b. Avoidance of injustice. b. Avoidance of injustice. Like § 90, this Section states a flexible Like § 90, this Section states a flexible principle, but the requirement of consideration is more easily principle, but the requirement of consideration is more easily displaced than the requirement of a writing.... Subsection (2) displaced than the requirement of a writing.... Subsection (2) lists some of the relevant factors in applying the latter lists some of the relevant factors in applying the latter requirement. Each factor relates either to the extent to which requirement. Each factor relates either to the extent to which reliance furnishes a compelling substantive basis for relief in reliance furnishes a compelling substantive basis for relief in addition to the expectations created by the promise or to the addition to the expectations created by the promise or to the extent to which the circumstances satisfy the evidentiary extent to which the circumstances satisfy the evidentiary purpose of the Statute [of Frauds] and fulfillpurpose of the Statute [of Frauds] and fulfill any cautionary, any cautionary, deterrent and channeling functions it may serve. deterrent and channeling functions it may serve.

R2 § 129. Action in RelianceR2 § 129. Action in Reliance(Land Contract)(Land Contract)

A contract for the transfer of an interest in land may be A contract for the transfer of an interest in land may be specifically enforced specifically enforced notwithstanding failure to notwithstanding failure to comply with the Statute of Fraudscomply with the Statute of Frauds if … the party if … the party seeking enforcement, in seeking enforcement, in reasonable reliancereasonable reliance on the on the contract and on the contract and on the continuing assentcontinuing assent of the party of the party against whom enforcement is sought, has so against whom enforcement is sought, has so changed changed his positionhis position that injustice can be avoided only by that injustice can be avoided only by specific enforcement.specific enforcement.

R2 § 87(2). Option ContractR2 § 87(2). Option Contract

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An offer which the offeror should An offer which the offeror should reasonably expectreasonably expect to to induce action or forbearanceinduce action or forbearance of a substantial character of a substantial character on the part of the offeree before acceptance and which on the part of the offeree before acceptance and which does inducedoes induce such action or forbearance is binding as an such action or forbearance is binding as an option contract to the extent necessary to option contract to the extent necessary to avoid avoid injusticeinjustice..

R2 § 86: Promissory RestitutionR2 § 86: Promissory Restitution

(1)(1) A promise made in recognition of a benefit previously A promise made in recognition of a benefit previously received by the promisor from the promisee is binding to the received by the promisor from the promisee is binding to the extent necessary to prevent injustice.extent necessary to prevent injustice.

(2) (2) A promise is not binding under Subsection (1)A promise is not binding under Subsection (1)

(a) if the promisee conferred the benefit as a (a) if the promisee conferred the benefit as a giftgift or for other or for other reasons the promisor has reasons the promisor has not been unjustly enrichednot been unjustly enriched; or; or

(b) to the extent that its value is (b) to the extent that its value is disproportionatedisproportionate to the to the benefit.benefit.


CommentComment

b. Rationale.b. Rationale. Although in general a person who has been Although in general a person who has been unjustly enriched at the expense of another is required to make unjustly enriched at the expense of another is required to make restitution, restitution is denied in many cases in order to protect restitution, restitution is denied in many cases in order to protect persons who have had benefits thrust upon them …. [A] persons who have had benefits thrust upon them …. [A] subsequent promise to make restitution removes the reason for subsequent promise to make restitution removes the reason for the denial of relief, and the policy of unjust enrichment then the denial of relief, and the policy of unjust enrichment then prevails ….prevails ….


CommentComment

d. Emergency services and necessaries.d. Emergency services and necessaries. The law of restitution in The law of restitution in the absence of promise severely limits recovery for necessaries the absence of promise severely limits recovery for necessaries furnished to a person under disability and for emergency furnished to a person under disability and for emergency services.... A subsequent promise in such a case may remove services.... A subsequent promise in such a case may remove doubt as to the reality of the benefit and as to its value, and may doubt as to the reality of the benefit and as to its value, and may negate any danger of imposition or false claim. …[A]n intention negate any danger of imposition or false claim. …[A]n intention to make, a gift must be shown to defeat restitution ....to make, a gift must be shown to defeat restitution ....


CommentComment

f. Benefit conferred pursuant to contract.f. Benefit conferred pursuant to contract. By virtue of the policy By virtue of the policy of enforcing bargains, the enrichment of one party as a result of of enforcing bargains, the enrichment of one party as a result of an unequal exchange is not regarded as unjust, and this Section an unequal exchange is not regarded as unjust, and this Section has no application to a promise to pay or perform more or to has no application to a promise to pay or perform more or to accept less than is called for by a preexisting bargain between the accept less than is called for by a preexisting bargain between the same parties. Compare §§ 79, 89…. But a promise to pay in same parties. Compare §§ 79, 89…. But a promise to pay in substitution for the return performance called for by the bargain substitution for the return performance called for by the bargain may be binding under this Section.may be binding under this Section.

RR § 1. Unjust EnrichmentRR § 1. Unjust Enrichment

A person who has been unjustly enriched at the A person who has been unjustly enriched at the expense of another is required to make restitution to expense of another is required to make restitution to the other.the other.


CommentComment

b. b. What constitutes a benefitWhat constitutes a benefit. A person confers a benefit upon . A person confers a benefit upon another if he gives to the other possession of, or some other another if he gives to the other possession of, or some other interest in money, land, chattels, or choses in action, interest in money, land, chattels, or choses in action, performs services beneficial to or at the request of the other, performs services beneficial to or at the request of the other, satisfies a debt or a duty of the other, or in any way adds to satisfies a debt or a duty of the other, or in any way adds to the other's security or advantage. He confers a benefit not the other's security or advantage. He confers a benefit not only where he adds to the property of another, but also where only where he adds to the property of another, but also where he saves the other from expense or loss. The word “benefit,” he saves the other from expense or loss. The word “benefit,” therefore, denotes any form of advantage….therefore, denotes any form of advantage….


CommentComment

e. e. Unjust retention of benefitUnjust retention of benefit. Even where a person has received a . Even where a person has received a benefit from another, he is liable to pay … only if the benefit from another, he is liable to pay … only if the circumstances of its receipt or retention are such that, as circumstances of its receipt or retention are such that, as between the two persons, it is unjust for him to retain it. The between the two persons, it is unjust for him to retain it. The mere fact that a person benefits another is not of itself mere fact that a person benefits another is not of itself sufficient to re quire the other to make restitution therefor. sufficient to re quire the other to make restitution therefor. Thus, one who improves his own land ordinarily benefits his Thus, one who improves his own land ordinarily benefits his neighbors to some extent, and one who makes a gift or neighbors to some extent, and one who makes a gift or voluntarily pays money which he knows he does not owe voluntarily pays money which he knows he does not owe confers a benefit; in neither case is he entitled to restitution…. confers a benefit; in neither case is he entitled to restitution….

RR § 2. RR § 2. Officious Conferring of a BenefitOfficious Conferring of a Benefit

A person who officiously confers a benefit upon A person who officiously confers a benefit upon another is not entitled to restitution therefor.another is not entitled to restitution therefor.

CommentComment

a. Officiousness means interference in the affairs of others not a. Officiousness means interference in the affairs of others not justified by the circumstances under which the interference justified by the circumstances under which the interference takes place…. The rule denying restitution to officious persons takes place…. The rule denying restitution to officious persons has the effect of penalizing those who thrust benefits upon has the effect of penalizing those who thrust benefits upon others and protecting persons who have had benefits thrust others and protecting persons who have had benefits thrust upon them (see § 112). upon them (see § 112).

RR § 116. Preservation of Another’s HealthRR § 116. Preservation of Another’s Health

A person who has supplied things or services to another, although A person who has supplied things or services to another, although acting without the other's knowledge or consent, is entitled to acting without the other's knowledge or consent, is entitled to restitution therefor from the other ifrestitution therefor from the other if

(a) he (a) he acted unofficiouslyacted unofficiously and with and with intent to chargeintent to charge therefor, therefor,

(b) the things or services were (b) the things or services were necessary to prevent the other from necessary to prevent the other from suffering serious bodily harm or painsuffering serious bodily harm or pain, and, and

(c) the person supplying them had (c) the person supplying them had no reason to know that the other no reason to know that the other would not consentwould not consent to receiving them, if mentally competent; and to receiving them, if mentally competent; and

(d) it was (d) it was impossible for the other to give consentimpossible for the other to give consent or, because of or, because of extreme youth or mental impairment, the other's consent would have extreme youth or mental impairment, the other's consent would have been immaterial.been immaterial.

RR § 117(1). Preserving Another’s Things or CreditRR § 117(1). Preserving Another’s Things or Credit

A person who, although acting without the other’s knowledge or consent, has A person who, although acting without the other’s knowledge or consent, has preserved things belonging to another from damage or destruction, is entitled to preserved things belonging to another from damage or destruction, is entitled to restitution for services rendered or expenditures incurred therein, ifrestitution for services rendered or expenditures incurred therein, if

(a)(a) he was in he was in lawful possession or custodylawful possession or custody of the things or if he lawfully of the things or if he lawfully took possession thereof, and the services or expenses were not made necessary by took possession thereof, and the services or expenses were not made necessary by his breach of duty to the other,his breach of duty to the other,

(b)(b) it was it was reasonably necessaryreasonably necessary that the services should be rendered or the that the services should be rendered or the expenditures incurred before it was possible to communicate with the owner by expenditures incurred before it was possible to communicate with the owner by reasonable means,reasonable means,

(c)(c) he had he had no reason to believeno reason to believe that the owner did not desire him so to act, that the owner did not desire him so to act,

(d)(d) he he intended to chargeintended to charge for such services or to retain the things as his own for such services or to retain the things as his own if the identity of the owner were not discovered or if the owner should disclaim, if the identity of the owner were not discovered or if the owner should disclaim, andand

(e)(e) the things have been the things have been accepted by the owneraccepted by the owner..

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Part V Enforceability in the Absence of a Contract