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appealsummary judgmentlease
plaintiffdefendantappealpleamotionsummary judgmentwilllease

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Pop’s Cones, Inc. v. Resorts Intern. Hotel, Inc., 307 N.J.Super. 461, 704 A.2d 1321

Facts

Pop's Cones, Inc. operated a TCBY franchise and engaged in discussions with Resorts International about relocating its business to a prime Boardwalk location. During these discussions, Resorts' representatives assured Pop's that financial issues could be resolved and even offered a free vending cart to test the location's traffic. Relying on these assurances, Pop's decided not to renew its lease at its Margate location, only to later find out that Resorts had withdrawn its offer to lease the new space.

Pop's is an authorized franchisee of TCBY Systems, Inc. … Relying upon Phoenix's 'advice and assurances,' Taube notified Pop's landlord in late-September 1994 that it would not be renewing the lease for the Margate location.

Issue

Did Pop's Cones, Inc. establish a prima facie case for promissory estoppel against Resorts International, Inc.?

Did Pop's Cones, Inc. establish a prima facie case for promissory estoppel against Resorts International, Inc.?

Rule

A promissory estoppel claim requires a clear and definite promise, expectation of reliance by the promisee, actual reliance on the promise, and substantial detriment incurred as a result of that reliance.

A promissory estoppel claim will be justified if the plaintiff satisfies its burden of demonstrating the existence of, or for purposes of summary judgment, a dispute as to a material fact with regard to, four separate elements which include: (1) a clear and definite promise by the promisor; (2) the promise must be made with the expectation that the promisee will rely thereon; (3) the promisee must in fact reasonably rely on the promise, and (4) detriment of a definite and substantial nature must be incurred in reliance on the promise.

Analysis

The court analyzed whether Pop's reliance on the assurances given by Resorts was reasonable and whether those assurances constituted a clear and definite promise. The court noted that Pop's had taken significant steps based on the representations made by Resorts, including vacating its previous location and incurring expenses related to the planned move. The court concluded that these facts raised a jury question regarding the reasonableness of Pop's reliance.

The facts as presented by plaintiff by way of its pleadings and certifications filed by Taube, which were not refuted or contradicted by defendant before the motion judge or on appeal, clearly show that when Taube informed Phoenix that Pop's option to renew its lease at its Margate location had to be exercised by October 1, 1994, Phoenix instructed Taube to give notice that it would not be extending the lease.

Conclusion

The Appellate Division reversed the summary judgment in favor of Resorts and remanded the case for further proceedings, indicating that Pop's had sufficiently raised a claim for promissory estoppel.

Reversed and remanded for further appropriate proceedings.

Who won?

Pop's Cones, Inc. prevailed in the appeal because the court found that it had established a prima facie case for promissory estoppel, which warranted further examination.

Pop's Cones, Inc. … its equitable claim raised a jury question.

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