This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2006).
IN COURT OF APPEALS
Walter R. Fields,
Filed July 24, 2007
Affirmed; motion granted in part
Hennepin County District Court
File No. 27-CV-05-006873
Michael B. Padden, Padden & Associates, P.L.L.C., P.O. Box 65521, St. Paul, MN 55101-0521 (for respondent)
Considered and decided by Peterson, Presiding Judge; Shumaker, Judge; and Ross, Judge.
U N P U B L I S H E D O P I N I O N
This appeal is from a judgment and an order denying posttrial motions. The judgment awarded respondent damages in the amount of the cost of her law-school tuition and books based on a determination that the elements of promissory estoppel were proved with respect to appellant’s promise to pay for the tuition and books. We affirm the judgment and grant in part and deny in part respondent’s motion to strike appellant’s brief and appendix.
Appellant Walter R. Fields and respondent Marjorie Conrad
met and became friends when they were neighbors in an apartment complex in the
early 1990’s. Appellant started his own
business and became a financially successful businessman. Appellant built a $1.2 million house in the
Kenwood neighborhood in
In the fall of 2000, appellant suggested that respondent attend law school, and he offered to pay for her education. Respondent, who had recently paid off an $11,000 medical bill and still owed about $5,000 for undergraduate student loans, did not feel capable of paying for law school on her own. Appellant promised that he would pay tuition and other expenses associated with law school as they became due. Appellant quit her job at Qwest, where she had been earning $45,000 per year, to attend law school. Appellant admitted at trial that before respondent enrolled in law school, he agreed to pay her tuition.
Respondent testified that she enrolled in law school in the summer of 2001 as a result of appellant’s “inducement and assurance to pay for [her] education.” Appellant made two tuition payments, each in the amount of $1,949.75, in August and October 2001, but he stopped payment on the check for the second payment. At some point, appellant told respondent that his assets had been frozen due to an Internal Revenue Service audit and that payment of her education expenses would be delayed until he got the matter straightened out. In May 2004, appellant and respondent exchanged e-mail messages about respondent’s difficulties in managing the debts that she had incurred for law school. In response to one of respondent’s messages, appellant wrote, “to be clear and in writing, when you graduate law school and pas[s] your bar exam, I will pay your tuition.” Later, appellant told respondent that he would not pay her expenses, and he threatened to get a restraining order against her if she continued attempting to communicate with him.
Respondent brought suit against appellant, alleging that in reliance on appellant’s promise to pay her education expenses, she gave up the opportunity to earn income through full-time employment and enrolled in law school. The case was tried to the court, which awarded respondent damages in the amount of $87,314.63 under the doctrine of promissory estoppel. The district court denied appellant’s motion for a new trial or amended findings. This appeal followed.
D E C I S I O N
district court’s “[f]indings of fact, whether based on oral or documentary
evidence, shall not be set aside unless clearly erroneous, and due regard shall
be given to the opportunity of the trial court to judge the credibility of the
elements of a promissory estoppel claim are (1) a clear and definite promise,
(2) the promisor intended to induce reliance by the promisee, and the promisee
relied to the promisee’s detriment, and (3) the promise must be enforced to
prevent injustice. Cohen v. Cowles Media Co., 479 N.W.2d 387, 391 (
equitable relief is within the sound discretion of the trial court. Only a clear abuse of that discretion will
result in reversal.” Nadeau v.
[t]he court considers the injustice factor as a matter of law, looking to the reasonableness of the promisee’s reliance and weighing public policies (in favor of both enforcing bargains and preventing unjust enrichment). When the facts are taken as true, it is a question of law as to whether they rise to the level of promissory estoppel.
Greuling v. Wells Fargo Home Mortgage, Inc., 690 N.W.2d 757, 761 (Minn. App. 2005) (citation omitted).
argues that respondent did not plead or prove the elements of promissory
Paragraph 12 of respondent’s complaint states, “That as a direct and approximate result of the negligent conduct and breach of contract conduct of [appellant], [respondent] has been damaged . . . .” But the complaint also states:
4. That in 2000, based on the
assurance and inducement of [appellant] to pay for [respondent’s] legal
education, [respondent] made the decision to enroll in law school at Hamline
University School of Law (Hamline) in
5. That but for the inducement and assurance of [appellant] to pay for [respondent’s] legal education, [respondent] would not have enrolled in law school. [Appellant] was aware of this fact.
Paragraphs four and five of the complaint are sufficient to put appellant on notice of the promissory-estoppel claim.
At a pretrial deposition, respondent testified that negligence and breach of contract were the only two causes of action that she was pleading. Because promissory estoppel is described as a contract implied at law, respondent’s deposition testimony can be interpreted to include a promissory-estoppel claim.
In its legal analysis, the district court stated:
The Court finds credible [respondent’s] testimony that [appellant] encouraged her to go to law school, knowing that she would not be able to pay for it on her own. He knew that she was short on money, having helped her pay for food and other necessities. He knew that she was working at Qwest and would need to quit her job to go to law school. He offered to pay for the cost of her going to law school, knowing that she had debts from her undergraduate tuition. He made a payment on her law school tuition after she enrolled. [Respondent] knew that [appellant] was a wealthy philanthropist, and that he had offered to pay for the education of strangers he had met in chance encounters. She knew that he had the wealth to pay for her law school education. She knew that  he was established in society, older than she, not married, without children, an owner of a successful company, an owner of an expensive home, and a lessor of an expensive car. Moreover, [appellant] was a friend who had performed many kindnesses for her already, and she trusted him. [Appellant’s] promise in fact induced [respondent] to quit her job at Qwest and enroll in law school, which she had not otherwise planned to do. . . .
. . . [T]he circumstances support a finding that it would be unjust not to enforce the promise. Upon reliance on [appellant’s] promise, [respondent] quit her job. She attended law school despite a serious health condition that might otherwise have deterred her from going.
These findings are sufficient to show that respondent proved the elements of promissory estoppel.
Appellant argues that because he advised respondent shortly after she enrolled in law school that he would not be paying her law-school expenses as they came due, respondent could not have reasonably relied on his promise to pay her expenses to her detriment after he repudiated the promise. Appellant contends that the only injustice that resulted from his promise involved the original $5,000 in expenses that respondent incurred to enter law school. But appellant’s statement that he would not pay the expenses as they came due did not make respondent’s reliance unreasonable because appellant also told respondent that his financial problems were temporary and that he would pay her tuition when she graduated and passed the bar exam. This statement made it reasonable for respondent to continue to rely on appellant’s promise that he would pay her expenses.
Citing Olson v. Synergistic Techs. Bus. Sys., Inc.,
628 N.W.2d 142, 151 (
American courts adopted the Chancery
court’s equitable cause of action based on good-faith reliance to enforce
promises unsupported by consideration – not as a consideration substitute, but
rather as a doctrine based on reliance that the courts could use to prevent
injustice. Eventually, the American
courts characterized this line of cases as “promissory estoppel,” and
identified the key elements of the doctrine of promissory estoppel as (1) a
promise, (2) the promisee’s right to rely on the promise and the promisor’s
duty to prevent reliance, and (3) harm suffered in reliance on the promise.
Over time, the doctrine of promissory estoppel evolved, and courts began to
focus on the promisee’s right to rely rather than the promisor’s duty to
prevent reliance. As the doctrine
developed, many courts adopted the Restatement of Contracts § 90 (1932)
(setting out the elements of promissory estoppel), but in
628 N.W.2d at 151 (citations omitted). Read in its entirety, Olson does not indicate that consideration is required for recovery under the promissory-estoppel doctrine.
argues that because he did not sign a written agreement between the parties and
respondent admitted that she intended to take more than one year to complete
law school, any contract between the parties is unenforceable under the statute
of frauds. Under the statute of frauds, if
an agreement “by its terms is not to be performed within one year,” no action
upon the agreement shall be maintained unless the “agreement, or some note or
memorandum thereof, expressing the consideration, is in writing, and subscribed
by the party charged therewith[.]”
agreement “may be taken outside the statute of frauds by . . . promissory
estoppel.” Norwest Bank Minn. v. Midwestern Mach. Co., 481 N.W.2d 875, 880
(1992) (citing Berg v. Carlstrom, 347
N.W.2d 809, 812 (
Because appellant’s expensive home and car and position as a successful business owner made it appear as if he was fully capable of keeping his promise to pay respondent’s law-school expenses and because appellant had bestowed his generosity on respondent several times before he promised to pay her law-school expenses, appellant reasonably should have expected his promise to induce action by respondent. The promise did induce action by respondent and left her with a substantial debt when appellant failed to keep his promise. Respondent quit her job and attended law school with the expectation that appellant would pay her law-school expenses and she would not be in debt for these expenses when she graduated. Because it would be unjust to require respondent to pay a debt that she incurred in reliance on appellant’s promise to pay the debt, appellant’s promise is enforceable notwithstanding the statute of frauds.
actions based on promissory estoppel, “[r]elief may be limited to damages
measured by the promisee’s reliance.” Dallum v. Farmers Union Cent. Exchange, Inc.,
462 N.W.2d 608, 613 (
Appellant objects to respondent seeking damages for lost income and living expenses, including housing. But the district court awarded respondent damages only for the cost of tuition and books. Appellant argues that respondent sought double recovery for the cost of tuition and the amount of her student loans. But an exhibit prepared by respondent and admitted into evidence shows that tuition totaled $86,462.21 and books cost $2,802.17. The district court awarded respondent $87,314.63 (tuition plus books minus payment made by appellant).
Appellant argues that respondent was obligated to mitigate her damages and she could have avoided all of her damages by dropping out of law school immediately after appellant refused to pay her tuition as it was incurred. But as we explained when addressing the reasonableness of respondent’s reliance, appellant told respondent that his financial difficulties were temporary and that he would pay her expenses after graduation. Under these circumstances, respondent was not aware until after she graduated that she would suffer damages, and by the time she graduated, she had already paid for her tuition and books and had no opportunity to mitigate damages.
Appellant argues that because respondent received a valuable law degree, she did not suffer any real detriment by relying on his promise. But receiving a law degree was the expected and intended consequence of appellant’s promise, and the essence of appellant’s promise was that respondent would receive the law degree without the debt associated with attending law school. Although respondent benefited from attending law school, the debt that she incurred in reliance on appellant’s promise is a detriment to her.
record on appeal consists of “[t]he papers filed in the trial court, the
exhibits, and the transcript of the proceedings[.]”
Respondent argues that appellant’s entire brief and appendix should be stricken due to references to deposition transcripts and a tax-lien document. The deposition transcripts were part of the district court record. Appellant’s reference to respondent’s deposition in his argument relating to the theories pleaded in the complaint is proper, and we deny the motion to strike the entire brief and appendix. Although the deposition is part of the record, because it was not admitted into evidence at trial, it cannot be used to prove facts disputed at trial. Therefore, we grant respondent’s motion to strike references to the depositions to support factual allegations.
tax-lien document was not part of the record before the district court. This court may consider essentially
uncontroverted documentary evidence that is not included in the district court
file. Franke v. Farm Bureau Mut. Ins.
Affirmed; motion granted in part.