D gave P (Scothorn) a promissory note and told her that none of the rest of his grandchildren worked and now she wouldn't have to either.
P quit her job as bookkeeper because of the note.
D expressed regret that he had not been able to pay the balance of the note before he died.
After death of D, P sued for balance of note and interest.
Procedural History:
Lower court found for P.
Affirmed, found for P.
Issues:
If a promisee suffers a detriment/weaken their position because they rely on a promise from a promisor, is the promise enforceable even without consideration (i.e. a gift)?
Holding/Rule:
A promise is enforceable even without consideration (i.e. a gift) if the promisee suffers a detriment/weaken their position because they rely on a promise from the promisor.
Reasoning:
P's right to the money was not dependent upon any action or forbearance. It was simply a gift.
It has been held that an action on a note given to a church, college, or other institution, upon the faith that the money has been expended or obligations incurred, could not be successfully defended on the ground of a lack of consideration.
When the payee changes his position to his disadvantage in reliance on the promise, a right of action does arise.
"Having intentionally influenced the P to alter her position for the worse on the faith of the note being paid when due, it would be grossly inequitable to permit the maker, or his executor, to resist payment on the ground that the promise was given without consideration."
