ContractsProf Blog

Editor: D. A. Jeremy Telman
Valparaiso Univ. Law School

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Wednesday, September 16, 2009

Macaulay & Whitford on Hoffman v. Red Owl Stores

Red Owl When I first learned that Steward Macaulay and William Whitford had written a new “Law Stories” article about Hoffman v. Red Owl Stores, all I could do was groan.  I had already read Robert Scott’s piece on the case.  How much background material can I possibly incorporate into a discussion of one case?!?  But Professors Macaulay and Whitford have made use of their access to the plaintiff in the case, Joseph Hoffman, and do indeed have new information to share.  Based on new factual findings the two reach different conclusions from those of Professor Scott.  And they do so, I must say, with class, praising him as a giant of contracts scholarship.   As I have only read a draft of the Macaulay and Whitford article, I will not quote them, but you can find their draft here and their very respectful expression of disagreement with Professor Scott can be found in footnote 15 of the draft.

It is a piece that pays great dividends, not only for what it says about Hoffman, but also for all the pearls of wisdom the authors let fall along the way, which relate not only to contracts doctrine, but also to pedagogy and the advantages of the Law Stories approach to scholarship.  Here is the abstract from SSRN:

Hoffman v. Red Owl Stores is one of the most famous 20th century cases in American contract law, usually credited both with expanding the reach of the promissory estoppel doctrine and with opening up the issue of liability for precontractual reliance. It is a staple in contracts casebooks. By fortunate circumstance we have located the plaintiff, who retains a vivid memory about many of the circumstances in his famous case. We have interviewed him and we have examined the full trial record as well as the briefs on appeal. In this article we tell the story of what we have learned about this famous case, including what happened after the appellate decision. We conclude that a fuller understanding of the facts provides information about a promise that was made, yet was not described in the Court’s opinion. This promise supports the outcome of the litigation. Justice was done! The plaintiff substantially relied to his detriment after receiving specific assurances from an authorized agent of the defendant that he would receive a franchise if he relied by selling his bakery building and business. Reimbursing precontractual reliance in this circumstance can be done without creating a rule that would justify reimbursement of precontractual reliance in all circumstances.

I see that the article is now forthcoming in the Hastings Law Journal, so congratulations to the authors on that fine placement!

[Jeremy Telman]

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