law-promissory-estoppel-statute-of-frauds-exception | elements of promissory estoppel theory as a claim
pleaded in the alternative to breach of contract | not to be confused with breach of promissory note | promissory
note suit | promissory note proof of damages | other types of estoppel |
PROMISSORY ESTOPPEL AND STATUTE OF FRAUDS
In its third issue, National argues that summary judgment was improper because promissory
estoppel removed the contract from the statute of frauds.
For promissory estoppel to create an exception to the statute of frauds, there must have
been a promise to sign a written contract that had been prepared and that would satisfy
the requirements of the statute of frauds. See Nagel v. Nagle, 633 S.W.2d 796, 800 (Tex. 1982).
Courts will enforce an oral promise to sign an instrument complying with the statute of
frauds if (1) the promisor should have expected that his promise would lead the promisee to some definite and
substantial injury; (2) such an injury occurred; and (3) the court must enforce the promise to avoid injustice. See
id. (citing “Moore"
Burger, Inc. v. Phillips Petroleum Co., 492 S.W.2d 934 (Tex. 1973)). It is the promise to sign a
written agreement or enter into written agreement that is determinative. See Southmark Corp. v. Life
Investors, Inc., 851 F.2d 763, 769 (5th Cir. 1988); “Moore” Burger, 492 S.W.2d at 938, 940.
Promissory estoppel sufficient to remove a contract from the statute of frauds requires that the promisor
agree to sign a document that had already been prepared or “whose wording had been agreed upon” that
would satisfy the statute of frauds. See Southmark Corp., 851 F.2d 763 at 766. A promise to prepare
a written contract is not sufficient. See Beta Drilling, Inc. v. Durkee, 821 S.W.2d 739, 741 (Tex.
App.–Houston [14th Dist.] 1992, writ denied).
8
Massey alleges only that Weingarten representative Luther told him that he, Luther, had “obtained
approval” from Weingarten officials to extend the lease with an agreed rent schedule and reimbursement
agreement. Massey does not specifically allege that anyone at Weingarten promised to sign a preexisting
writing. Indeed, he does not allege that such a writing existed at the time of the purported promise. Nor
do we see in the cover letter a promise to sign the renewal letter. The cover letter provided that a copy
would be returned after execution. Moreover, when National received the renewal letter, the renewal letter
plainly stated it would become effective upon execution by both parties. When a party relies on a
memorandum of agreement in asserting a promissory estoppel exception to the statute of frauds, that
party may not disregard unfavorable provisions in the memorandum agreement. See Coastal Corp. v.
Atlantic Richfield Co., 852 S.W.2d 714, 717 (Tex. App.–Corpus Christi 1993, no writ) (citing Hall
v. Hall, 158 Tex. 95, 102, 308 S.W.2d 12, 17 (1957)). National signified its agreement with this term
by signing the renewal letter. We do not find in Weingarten’s actions a promise to sign a writing that either
was in existence or whose wording had been agreed upon.
As with its partial performance argument, National does not argue that its capital expenditures are
recoverable under promissory estoppel. It advances its estoppel argument only to satisfy the statute of
frauds with regard to the five-year lease extension. It has waived any claim for reimbursement of capital
expenditures. See TEX. R. APP. P. 38.1(h); Maranatha Temple, 893 S.W.2d at 105-06. We overrule
National’s third issue.
14-99-00079-CV (2000)
ELEMENTS OF PROMISSORY ESTOPPEL
There are three elements to promissory estoppel: 1) a pr\omise; 2) foreseeability by the promissor
that the promisee would rely on that promise; and 3) substantial reliance by the promisee to his detriment.
Allied Vista, Inc. v. Holt, 987 S.W.2d 138, 141 (Tex. App.–Houston[14th Dist.] 1999, no pet. h.)
(citing English v. Fischer, 660 S.W.2d 521, 524 (Tex.1983)). Promissory estoppel is a narrow
exception to the defense of the statute of frauds, operating to preclude a statute of frauds defense
only in two situations. See Nagle v. Nagle, 633 S.W.2d 796, 800 (Tex. 1982); Collins v. Allied Pharmacy
Mgt., 871 S.W.2d 929, 936 (Tex. App.–Houston [14th Dist.] 1994, no writ). This exception is available
only where the promise to be enforced is to sign a written agreement complying with the
statute or where there is reliance on a misrepresentation that the statute has been
satisfied. Nagle, 633 S.W.2d at 800; Collins, 871 S.W.2d at 936-37. 14-98-01102-CV (1999)