D&G Stout, Inc. v. Bacardi Imports, Inc. case brief summary
923 F.2d 566
PROCEDURAL POSTURE: Appellant seller challenged a ruling of the United States District Court for the Northern District of Indiana, South Bend Division, which granted appellee distributor summary judgment on appellant's promissory estoppel claim in which appellant sought damages incurred after appellee stopped providing its products.
OVERVIEW:
-Appellant seller sold liquor during a particularly difficult time in that market and thought about selling its business when only two distributors remained to supply liquor to appellant.
-Appellant negotiated with a potential purchaser and at the same time sought assurances from appellee distributor that appellee was not planning to end its relationship with appellant.
-Appellee assured appellant time and again that it was planning to supply appellant with liquor into the future and appellee knew appellant was considering selling its business.
-Appellant decided not to sell based largely on appellee's oral assurances and the next day appellee stopped providing product to appellant.
-Appellant was then forced to sell its business at a price significantly lower than it could have received only days earlier and appellant brought an action against appellee based in promissory estoppel.
-The trial court granted appellee summary judgment and appellant challenged that ruling.
HOLDING:
On appeal, the court reversed and held that appellee's assurances were the type that appellant might have reasonably relied upon (and thus a price deferential can be obtained). The action was remanded for further proceedings.
RULES:
“A promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee and a third person and which does induce such action or forbearance is binding if injustice can be avoided only by the enforcement of the promise.”
OUTCOME: The court reversed the trial court ruling, which granted appellee distributor summary judgment on appellant seller's promissory estoppel claim in which appellant sought damages incurred after appellee stopped providing its products. The court found that where appellee assured appellant it would not end their relationship but then did so one day later, that assurance might have been reasonably relied upon by appellant.
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923 F.2d 566
PROCEDURAL POSTURE: Appellant seller challenged a ruling of the United States District Court for the Northern District of Indiana, South Bend Division, which granted appellee distributor summary judgment on appellant's promissory estoppel claim in which appellant sought damages incurred after appellee stopped providing its products.
OVERVIEW:
-Appellant seller sold liquor during a particularly difficult time in that market and thought about selling its business when only two distributors remained to supply liquor to appellant.
-Appellant negotiated with a potential purchaser and at the same time sought assurances from appellee distributor that appellee was not planning to end its relationship with appellant.
-Appellee assured appellant time and again that it was planning to supply appellant with liquor into the future and appellee knew appellant was considering selling its business.
-Appellant decided not to sell based largely on appellee's oral assurances and the next day appellee stopped providing product to appellant.
-Appellant was then forced to sell its business at a price significantly lower than it could have received only days earlier and appellant brought an action against appellee based in promissory estoppel.
-The trial court granted appellee summary judgment and appellant challenged that ruling.
HOLDING:
On appeal, the court reversed and held that appellee's assurances were the type that appellant might have reasonably relied upon (and thus a price deferential can be obtained). The action was remanded for further proceedings.
RULES:
“A promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee and a third person and which does induce such action or forbearance is binding if injustice can be avoided only by the enforcement of the promise.”
OUTCOME: The court reversed the trial court ruling, which granted appellee distributor summary judgment on appellant seller's promissory estoppel claim in which appellant sought damages incurred after appellee stopped providing its products. The court found that where appellee assured appellant it would not end their relationship but then did so one day later, that assurance might have been reasonably relied upon by appellant.
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