Summary of Ricketts v. Scothorn
FACTS: On May 1, 1891 J.C. Ricketts gave Katie Scothorn, his granddaughter (Appellee) a promissory note for $2,000 payment on demand with 6% per annum interest. The grandfather stated that none of his grandchildren worked and he had set things up so Ms. Scothorn would not have to work either. There was no stated condition that Ms. Scothorn stop working or in any other capacity refrain from any other activity. Based upon the reliance of the grandfather's promise of the $2,000 (with interest), Ms. Scothorn stopped working. After some time, in September of 1892, Ms. Scothorn, with her grandfather's knowledge and help secured a new job as a bookkeeper. On June 18, 1894, J.C. Ricketts died. The grandfather had paid 1 years interest on the note and had stated in 1982 to his daughter that he would like to pay Ms. Scothorn the $2,000 as soon as his farm in Ohio was sold. The executor of J.C. Ricketts’ estate refused to pay Ms. Scothorn the money of the promissory note ! on the basis that it was a gratuity and lacked sufficient consideration. Ms. Scothorn received judgement in the District Court of Lancaster against the executor of the estate. The executor appealed.
ISSUE: Whether there was any consideration in the grandfather's giving of the promissory note.
RULE OF LAW: To be enforceable, a contract promising payment must be supported by valid consideration.
ANALYSIS: While there was no stated consideration in this agreement, the court found that Scothorn's reliance on the promise of the money was so great that it created a promissory estoppel on any attempt to obviate payment. Had Ms. Scothorn made a promise to her Grandfather to stop working, or in some way precluded herself from exercising a legal right that she otherwise had, the consideration would have been obvious. In this case, the court weighed the strength of the Appellee’s good faith reliance upon the promise, and her actions consistent with that reliance constituted a valuable and sufficient consideration.
CONCLUSION: The grandfather reasonably and clearly gave a promise to his granddaughter that she had a means to stop working; the granddaughter relied upon the terms of the promise and took reasonable steps to stop working, based upon the foreseeability of the fulfillment of the promise. Injustice in this case can only be avoided by enforcing the promise.