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Nebraska Supreme Court - 77 N.W. 365, 57 Neb. 51
tl;dr:
Plaintiff's grandpa promised to pay her $2,000/year for life, claiming he did not want her to ever have to work again. Plaintiff quit her job immediately. But then her grandpa died and the executor of the estate refused to pay.Video Summary
Case Summary
In Ricketts v. Scothorn (1898), Katie Scothorn (plaintiff) sued the executor of her grandfather’s estate, Andrew Ricketts (defendant), for failing to pay the money she was owed.
Katie Scothorn sued her grandfather's estate for breaching a contract when he gave her a promissory note worth $2,000 plus 6% interest, assuring her that she didn't need to work. She left her job as a bookkeeper, relying on the note for support. After her grandfather paid a year's interest but passed away without covering the principal amount, the executor of his estate refused to fulfill the note, claiming the lack of consideration.
Scothorn brought suit against Ricketts to recover the balance. The trial court ruled for Scothorn. Ricketts appealed.
The appellate court agreed with the trial court's decision in favor of the woman, recognizing her valid claim based on promissory estoppel. The court identified that the grandfather had intended for her to quit her job by providing the note, and she relied on his promise. It would be unfair to let the executor deny the promise when the woman's situation had worsened due to her reliance on it.
The case demonstrates how promissory estoppel can enforce promises without consideration. This equitable doctrine prevents a promisor from retracting a promise if the promisee has reasonably relied on it and experienced harm. Promissory estoppel is rooted in fairness and justice rather than mutual exchange. The case highlights the significance of examining parties' intent and conduct to determine if a promise and reliance existed. Moreover, it differentiates between a gift and a contract: a gift involves a voluntary transfer of property without expecting returns, while a contract entails a mutual agreement that creates legal obligations.
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The plaintiff, Katie Scothorn, won a case against the defendant, Andrew D. Ricketts, the executor of John C. Ricketts' will, based on a promissory note that John C. Ricketts had written to her. The note promised to pay her $2,000 on demand with an annual interest of 6%. The plaintiff alleged that the note was given to her as consideration for leaving her job and that she relied on it as a means of support. The defendant denied these allegations. The court found that the note was not enforceable as there was no valuable consideration, and the plaintiff did not change her position to her disadvantage in reliance on the promise. The court also noted that the doctrine of estoppel may make a note enforceable if it is given to a charitable institution, and money has been expended or obligations incurred based on the promise.
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