Does the clerk have a valid basis against the bookkeeper for the unpaid portion of the promised annuity due to reliance on the promised retirement fund?

• A. No, the contract modified and the promise was not enforceable.
• B. Yes, the clerk's reliance on the promised retirement fund makes the promise enforceable against the bookkeeper.
• C. Yes, but only if the clerk had a written instrument.
• D. No, because intended beneficiaries cannot recover on mere reliance.

Answer: (B)

The concept at play is promissory estoppel: enforcing a promise despite lack of consideration when the promisee reasonably relies on the promise to his detriment, and injustice would result if the promise isn’t enforced.

Here, the clerk relied on the bookkeeper’s promise of a retirement fund/annuity. That reliance was reasonable and foreseeable, and the clerk likely changed position or planned finances based on that promise, creating a detriment. Promissory estoppel allows the promise to be enforced to prevent injustice, so the unpaid portion of the annuity can be recovered even without a traditional contract or additional consideration. The idea that a writing or intended beneficiary status is required does not apply here, because promissory estoppel can bind the promisor based on reliance and injustice, not on a formal instrument.