Nicol v. Nelson

776 P.2d 1144, 13 Brief Times Rptr. 615, 1989 Colo. App. LEXIS 134, 1989 WL 55601
CourtColorado Court of Appeals
DecidedMay 25, 1989
Docket88CA0140
StatusPublished
Cited by8 cases

This text of 776 P.2d 1144 (Nicol v. Nelson) is published on Counsel Stack Legal Research, covering Colorado Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Nicol v. Nelson, 776 P.2d 1144, 13 Brief Times Rptr. 615, 1989 Colo. App. LEXIS 134, 1989 WL 55601 (Colo. Ct. App. 1989).

Opinion

TURSI, Judge.

Defendants, Ken Nelson and Daniel and Lydia Hilty, appeal from a judgment permanently enjoining them from developing a tract of land they own. We affirm.

Plaintiffs, Alan B. and Karen B. Nicol, Robert L. and Jere L. Hoerr, James B. and Mary Katherine Turner, and Donald A. and Ruth L. Anderson, purchased subdivision lots from defendant Ken Nelson. The lots bordered on the undeveloped tract in question and offered scenic views of an adjacent lake.

After defendants took steps to develop the property, plaintiffs commenced this action for injunctive relief. The trial court initially ruled that plaintiffs had an adequate remedy at law and dismissed their claim for equitable relief. However, on appeal, we reversed that ruling on the grounds that it was not clear as a matter of law that plaintiffs’ legal remedies would be adequate to compensate for the losses suffered, and remanded the cause for a determination on the merits. Benson v. Nelson, 725 P.2d 71 (Colo.App.1986).

At trial after that remand, the trial court found that plaintiffs purchased their lots only after receiving assurances from Nelson (1) that the tract would remain undeveloped open space, (2) that the property was owned by a ditch company which had no plans to build on the land, (3) that he held an option to purchase the property if it became available, and (4) that he would not develop the land if it came under his ownership. Accordingly, it granted injunctive relief, and this appeal followed.

I

Defendants first argue that the trial court erred in awarding a permanent injunction because plaintiffs’ claims were based on promissory estoppel. We disagree.

Contrary to defendants’ argument, injunctive relief is, under these circumstances, a proper remedy for a claim based on promissory estoppel. Restatement (Second) of Contracts § 90 comment d (1979) concerning partial performance states the following example:

“A is about to buy a house on a hill. Before buying he obtains a promise from B, who owns adjoining land, that B will not build on a particular portion of his lot, where a building would obstruct the view from the house. A then buys the house in reliance on the promise. B’s promise is binding, but will be specifically enforced only so long as A and his successors do not permanently terminate the use of the view.”

This illustration is based on the case of Miller v. Lawlor, 245 Iowa 1144, 66 N.W.2d 267 (1954), and closely mirrors the facts at issue. Also, other courts have awarded injunctive relief when the claim was based on promissory estoppel. See Thornton v. Schobe, 79 Colo. 25, 243 P. 617 (1925); Haines v. Minnock Construction Co., 289 Pa.Super. 209, 433 A.2d 30 (1981); and Restatement of Property § 524 (1944).

The doctrine of promissory estoppel is part of the common law of Colorado. See Vigoda v. Denver Urban Renewal Authority, 646 P.2d 900 (Colo.1982). The doctrine, as set forth in Restatement (Second) of Contracts § 90(1) (1979), provides that:

“A promise which the promisor should reasonably expect to induce action or a forbearance on the part of the promisee or third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. The remedy granted for breach may be limited as justice requires.”

The purpose of the doctrine is to assure fairness in business relationships by protecting one who relies to his detriment on the promise of another. Mooney v. Crad-dock, 35 Colo.App. 20, 530 P.2d 1302 (1974). Thus, we hold that a plaintiff proceeding on a theory of promissory estoppel, under *1147 facts such as these, may be granted injunc-tive relief.

II

Defendants assert, however, that the statute of frauds, which requires that interests in real property be specified in writing, bars enforcement of Nelson’s alleged oral promise. See § 38-10-108, C.R.S. (1982 Repl.Vol. 16A). We disagree.

The absence of a written contract cannot defeat a claim for relief when injustice to a promisee who has reasonably and justifiably relied on a promise can be prevented only by recognizing a right of recovery against the promisor. Kiely v. St. Germain, 670 P.2d 764 (Colo.1983).

The principle that detrimental action and justifiable reliance on an oral promise may be sufficient to override application of the statute of frauds and compel enforcement of the promise has been embodied in Restatement (Second) of Contracts § 139(1) (1979), which has been adopted in Colorado. See Kiely ¶. St. Germain, supra. That Restatement section states:

“A promise which the promisor should reasonably expect to induce action or a forbearance on the part of the promisee or third person and which does induce the action or forbearance is enforceable notwithstanding the Statute of Frauds if injustice can be avoided only by enforcement of the promise. The remedy granted for breach is to be limited as justice requires.”

Oral promises regarding the use of land may also be enforced under Restatement of Property § 524 which provides that:

“An oral promise or representation that certain land will be used in a particular way, though otherwise unenforceable, is enforceable to the extent necessary to protect expenditures made in reasonable reliance upon it.”

And, comment b thereto states:

“The phrase ‘though otherwise unenforceable’ as here used means that the promise could not be enforced were it not for the application of the doctrines of estoppel. Some promises respecting the use of land do not come within the provisions of the Statute of Frauds. As to such promises the fact that they are oral is not material in respect to their enforcement.”

See Haines v. Minnock Construction Co., supra.

Here, the trial court held that although the statute of frauds would ordinarily bar enforcement of Nelson’s promise, it did not constitute a defense under the facts of this action. Regardless of whether the trial court was correct in its determination that Nelson’s promise fell within the purview of the statute of frauds, see Thornton v. Schobe, supra, we agree that plaintiffs’ claims were not barred in view of the foregoing legal principles.

Ill

Defendants further argue that plaintiffs failed to present sufficient evidence to establish their claim of promissory estoppel. In support of this argument, they maintain that the elements of promissory estoppel must be shown by clear and convincing evidence.

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Bluebook (online)
776 P.2d 1144, 13 Brief Times Rptr. 615, 1989 Colo. App. LEXIS 134, 1989 WL 55601, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nicol-v-nelson-coloctapp-1989.