''Drennan v. Star Paving Company'',
51 Cal. 2d 409 (1958), was a
California Supreme Court case in which the court held that a party who has detrimentally relied on an offer that is revoked prior to acceptance may assert
promissory estoppel
A promise is a commitment by someone to do or not do something. As a noun ''promise'' means a declaration assuring that one will or will not do something. As a verb it means to commit oneself by a promise to do or give. It can also mean a capacity ...
to recover damages.
Background
William A. Drennan, a general contractor, had gotten a bid from Star Paving, a subcontractor for a construction job and had included Star Paving's bid number in his total bid. Drennan won the contract to build the Monte Vista Elementary School for the
Lancaster School District based on that bid. Subsequently, Star Paving contacted him to say that its initial bid had been approximately $7000 short, and that it would not be able to complete the project for the amount of money it had previously specified. After finding an alternative subcontractor to complete the job, Drennan sued Star Paving for the difference between its bid and the cost.
Opinion of the Court
Judge
Roger J. Traynor, writing for the California Supreme Court, held that the plaintiff's reliance on defendant's bid, as well as defendant's failure to indicate that the bid was revocable before acceptance, meant that defendant was responsible for providing the service at the price initially specified.
Impact
In
contracts
A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tran ...
courses this case is often contrasted with ''
James Baird Co. v. Gimbel Bros.'', a 1933 case with similar facts from the
Second Circuit decided by Judge
Learned Hand. Hand held that an offeror was free to revoke the offer prior to acceptance; twenty-five years later, when the doctrine of
promissory estoppel
A promise is a commitment by someone to do or not do something. As a noun ''promise'' means a declaration assuring that one will or will not do something. As a verb it means to commit oneself by a promise to do or give. It can also mean a capacity ...
had found wider acceptance, Traynor held that the offer was irrevocable once the offeree had relied upon it.
References
External links
Monte Vista Elementary official site{{United States contract case law
California state case law
1958 in United States case law
1958 in California
United States contract case law
Lancaster, California