P was a pharmacist at Richter Drug who was seeking employment in a hospital or clinical setting. P was informed that D was seeking a pharmacist.
P filled out an application and had interviews with the chief pharmacist and general manager of D.
D offered P a position in a clinic. P accepted, put in his notice at Richter, and told D that he had to give 2 weeks' notice to Richter.
That afternoon, VA Hospital offered P a job which he declined because of D's offer.
GM of D told chief pharmacist that they had to get a favorable reference in order to hire P. They could not get one, so D hired someone else.
P had a hard time finding employment after this.
Procedural History:
Trial court found for D.
Reversed on appeal, found for P.
Issues:
Can the rescinding of an at-will employment contract give rise to a cause of action if the employee relies on the offer and suffers a detriment?
Holding/Rule:
Promissory estoppel allows for an employee to recover damages if he relies on an offer of at-will employment that is later rescinded, given appropriate circumstances.
Reasoning:
Three questions must be answered affirmatively to support an action for promissory estoppel:
Was the promise one which the promisor should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee?
Did the promise induce such action or forbearance?
Can injustice be avoided only be enforcement of the promise?
The employee had a right to assume he would be given a good faith opportunity to perform his duties to the satisfaction of the employer.
The employee was denied this right and had already resigned from his position in reliance on the offer.
The prospective employment might have been terminated at any time, so the measure of damages should be what the P lost in quitting the job he held and declining at least one other offer of employment elsewhere.
Promissory estoppel could even apply after employment has begun since "the remedy granted for breach may be limited as justice requires".
