Pop's Cones, Inc. v. Resorts International Hotel, Inc.

Facts

Pop's (P) was an authorized franchisee of TCBY. Resorts (D) was a casino hotel in Atlantic City that leased space along its Boardwalk frontage. P operated her franchise in Margate and had discussions with D about a possible relocation to space owned by D. D indicated that they were very anxious to have P as a tenant and that the financial issues of the current high rental fees could be worked out. D also indicated that it would permit P to operate a vending cart within D free of charge during the summer to test the traffic flow. This offer was considered and approved by the Vice President for Hotel operations for D. P, in fact, opened a cart for business at D pursuant to the stated offer. In response to P’s inquiry, TCBY gave P approval to change its franchise site. In late July or early August of 1994, a representative of TCBY visited the Players Club location with P and D present. A drafted lease was offered by P to D with D getting 7% of the net monthly sales for the duration of the lease with a six-year lease with a renewable option for another six years. P was in a hurry to get a determination from D as it had to renew it current lease location by October 1, 1994, so P asked D about the status of her proposal. P was assured that there would be little difficulty in getting the final agreement and D told P that he should inform her current landlord that she was moving to D. It was also alleged that D told P that the agreement would have to be signed by the Chief Operating Officer of D but that 95% of everything was in place and that the COO would follow his recommendations and that no difficulties were anticipated. P again asked for assurances and when D was confronted with P’s current problem for lease renewal, P was assured by D that there would be little difficulty in closing the deal and that P should give notice and plan on moving. P notified its landlord that it would not be renewing. P moved her equipment out of the Margate location and placed it in temporary storage. P then commenced new site preparations including sending designs for the new store to TCBY and retaining an attorney to represent P in finalizing the terms with D. General Counsel for D forwarded a proposed lease form to D for the 'Players Club' location and then forwarded a separate letter for the terms D was proposing in the lease. D was only willing to offer three years with rent calculated at 7% or $50,000 per year whichever was greater, $60,000 in year two and $70,000 in year three with a three-year option to renew. The letter stated that it was not intended to be binding. P and D met, but the finalization was postponed until the new-year and P was assured that the lease terms would be worked out. P was assured at that meeting that D wanted P on the boardwalk for the following season. Several attempts were made in early January 1995 to contact D and confirm the matters. P then received a letter on January 30, 1995, withdrawing the offers. Extensive efforts were made to reopen the franchise at another location, but the business did not reopen until July 5, 1996. P sued D. The complaint alleged that P reasonably relied to its detriment on the promises and assurances of D. D moved for summary judgment and it was granted under Malaker. The trial judge reasoned that P was unable to meet the requirements for Promissory Estoppel because there was no clear and definite promise made to P and therefore any reliance by P was unreasonable. The trial judge found that there was no specificity as to the terms of the lease nor even a starting date and even P admitted that when she left the meeting that they didn’t have a lease. The judge concluded that the evidence was so one-sided that D was entitled to prevail as a matter of law. P appealed. 

Issues

Rule of Law

Holding and Decision

Legal Analysis

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