Louisiana Law Review
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Spring 2016
O(er at Your Own Risk: Why Louisiana
Employers Who Withdraw an O(er of
Employment May Find )emselves Liable Under
Civil Code Article 1967
Taylor Crousillac
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Offer at Your Own Risk: Why Louisiana Employers
Who Withdraw an Offer of Employment May Find
Themselves Liable Under Civil Code Article 1967
TABLE OF CONTENTS
Introduction .................................................................................. 922
I. Trying to Find the Answer: The Various Approaches to
Rescinded Employment Offers ..................................................... 924
A. Jurisdictions that Allow a Wronged Prospective Employee
a Cause of Action ................................................................... 925
B. Jurisdictions that Do Not Allow a Wronged Prospective
Employee a Cause of Action .................................................. 929
C. Louisiana’s Misguided Approach .......................................... 931
1. A First Take: May v. Harris Management Corp. ............ 931
a. The May Majority’s Faulty Rationale ....................... 932
b. The May Concurrence’s Apprehensive Rationale ..... 932
c. The May Dissent’s Well-Reasoned Rationale ........... 933
2. Another Chance: Bains v. The Young Men’s Christian
Ass’n of Greater New Orleans, Louisiana ....................... 934
II. Louisiana Doctrines Supporting the Existence of Pre-
EmploymentClaims: The At-Will Employment Doctrine,
Detrimental Reliance, and Civil Law Distinctions ....................... 936
A. The At-Will Employment Doctrine in Louisiana ................... 937
1. Louisiana Courts’ Misapplication of Article 2747 .......... 938
2. The Requirement of Good Faith in the At-Will
Relationship ..................................................................... 939
B. The Evolution of Detrimental Reliance in Louisiana ............. 941
1. Pre-Civil Code Article 1967 ............................................ 941
a. Historic Civil Law Roots .......................................... 942
b. Ducote v. Oden: Louisiana Supreme Court’s
Questionable Rejection of Promissory Estoppel ....... 943
2. A Defining Moment: Louisiana Legislature’s
Codification of Article 1967 ............................................ 944
C. Unique Civilian Concerns ...................................................... 946
1. Civil Law Cause as Compared to Common
Law Consideration ........................................................... 946
a. Common Law’s Burdensome Requirement of
Consideration .............................................................. 947
b. Civil Law’s Flexible Cause ......................................... 947
922 LOUISIANA LAW REVIEW [Vol. 76
2. Other Civil Code Provisions Affect the Analysis ............ 948
III. The Failure of Louisiana’s Current Approach .............................. 949
A. Detrimental Reliance Should Not Be Disfavored in
Louisiana Law ........................................................................ 950
B. The At-Will Employment Doctrine Should Not Supersede
Article 1967............................................................................ 950
C. Civilian Considerations Make a Difference ........................... 952
D. Public Policy Favors Recovery .............................................. 954
IV. Returning to Bob: The Application of Justice .............................. 956
Conclusion .................................................................................... 957
I
NTRODUCTION
Meet Bob, an extremely successful and hardworking individual who
has unexpectedly found himself without a job or a way to put food on the
table for his family. Just a few weeks ago, Bob was happily employed with
a good salary when Kirk, owner and chief executive officer of the largest
Louisiana company specializing in Bob’s area of expertise, contacted him.
Kirk offered Bob employment at his company with a salary substantially
higher than Bob’s current job. Kirk told Bob that he could start in two
weeks. Bob had to think of his family, his future, and his co-workers that
he would be leaving if he accepted Kirk’s offer. After serious
consideration and multiple conversations with Kirk about the sincerity of
his offer, Bob finally accepted the position and quit his current job. Bob
and his family were thrilled at the prospect of greater economic liberty that
would come with the promised increase in income.
Shockingly, Kirk called Bob the Friday before his start date and
withdrew his offer of employment, telling Bob that he no longer thought
that hiring Bob was a good idea for the company. Bob was in disbelief
upon hearing this, and immediately called his former employer begging to
return, but it had no longer wanted Bob back. Because Bob works in a
specialized field, he faces bleak prospects of finding another job at his skill
level in a reasonable time. Despite being elated just hours before, Bob’s
entire family was now at risk.
Kirk’s actions and promises led directly to Bob’s calculated decision
to quit his job, and Bob would not be unemployed if Kirk had not offered
him a better job. Despite this obvious problem, Louisiana courts have
applied the state’s at-will employment doctrine to hold that relying on an
2016] COMMENT 923
offer of employment is unreasonable as a matter of law.
1
This holding
means that an aggrieved prospective employee has no chance to argue his
or her case on the merits, no matter how egregious the employer’s actions.
2
This result is surprising in light of Louisiana’s detrimental reliance theory
that is codified in Louisiana Civil Code article 1967, which seems
perfectly tailored for Bob’s situation.
3
The current Louisiana jurisprudence that categorically bars recovery
on revoked offers of employment claims is misguided and should be
overruled. Under Louisiana law, courts should not consider relying on an
offer of employment unreasonable as a matter of law, even if that
employment is at will. In certain circumstances, a prospective employee’s
reliance on an employer’s offer of employment is completely reasonable.
Copyright 2016, by TAYLOR CROUSILLAC.
1. See May v. Harris Mgmt. Corp., 928 So. 2d 140, 148 (La. Ct. App. 1st
2005) (“We hold that it is unreasonable as a matter of law to rely on an offer of
at-will employment, just as it is patently unreasonable to rely on the permanency
of at-will employment once it begins.”); R
ICK J. NORMAN, LOUISIANA PRACTICE:
EMPLOYMENT LAW § 3:9, at 36 (Supp. 2013–2014 ed., 2013) (citing the May
holding as the rule); Tracy A. Bateman, Employer’s State-law Liability for
Withdrawing, or Substantially Altering, Job Offer for Indefinite Period Before
Employee Actually Commences Employment, 1 A.L.R.5th 401 (West, Westlaw
through 2015) (using May as the Louisiana Rule); Bains v. Young Men’s
Christian Ass’n of Greater New Orleans, 969 So. 2d 646, 652 (La. Ct. App. 4th
2007) (Armstrong, J., dissenting) (“Present Louisiana case law finds that it is
inherently unreasonable to rely on an offer of at-will employment.”); infra Part
II.A (discussing at-will employment in Louisiana).
2. This result is due to the fact that Louisiana jurisprudence requires a
plaintiff in detrimental reliance cases to prove three elements by a preponderance
of the evidence, and an absence of one of the elements can lead to the dismissal
of the plaintiff’s claims at the summary judgment stage. To recover under the
theory of detrimental reliance the plaintiff must prove: (1) the promisor made a
representation by conduct or word; (2) the promisee’s justifiable/reasonable
reliance on the promisor’s representation; and (3) a change in the promisee’s
position to his or her detriment because of that reliance. May, 928 So. 2d at 145;
see also Murphy Cormier Gen. Contractor, Inc. v. Dep’t of Health & Hosps., 114
So. 3d 567, 596 (La. Ct. App. 2013); Amitech U.S.A., Ltd. v. Nottingham Constr.
Co., 57 So. 3d 1043, 1052 (La. Ct. App. 2010). This Comment focuses on the
second element.
3. The article in pertinent part states:
A party may be obligated by a promise when he knew or should have
known that the promise would induce the other party to rely on it to his
detriment and the other party was reasonable in so relying. Recovery
may be limited to the expenses incurred or the damages suffered as a
result of the promisee’s reliance on the promise.
L
A. CIV. CODE art. 1967 (2015). The facts in this hypothetical share many
similarities with the facts of Bains, 969 So. 2d 646. See infra Part I.C.2 (discussing
the Bains decision).
924 LOUISIANA LAW REVIEW [Vol. 76
Thus, Louisiana courts should consider revoked offer of employment
claims on their own merit under article 1967.
In Part I, this Comment gives an overview of the approaches and
solutions that various American jurisdictions have taken, then turns its
focus to the Louisiana jurisprudence regarding reliance on an offer of at-
will employment. Part II outlines Louisiana’s at-will employment doctrine
and also discusses the evolution of detrimental reliance as a basis for
recovery in Louisiana. Part II concludes with a discussion of the various
aspects of Louisiana law that make reliance on an offer of employment
even more reasonable in Louisiana than in common law states. Part III
highlights the problems with the failure of Louisiana courts to apply
detrimental reliance in the context of a withdrawn offer of employment.
Finally, Part IV applies a solution to Bob’s problem that removes the
categorical bar of recovery for claims of detrimental reliance.
I.
TRYING TO FIND THE ANSWER: THE VARIOUS APPROACHES TO
RESCINDED EMPLOYMENT OFFERS
At-will employment is a jurisprudential doctrine that allows either the
employee or employer to end the employment relationship at any time for
any reason.
4
The doctrine is premised on the ideas that the employer and
the employee are on equal footing, and that because the employee is free
to resign whenever the employee pleases, the employer should likewise be
able to discharge the employee whenever the employer sees fit.
5
At-will
employment serves important social objectives, “such as the maintenance
of a free and efficient flow of human resources and the avoidance of
frictional expense when an employer fires an unproductive or disloyal
employee.”
6
Courts across the United States are divided on whether an
4. See, e.g., Burnett v. E. Baton Rouge Parish Sch. Bd., 99 So. 3d 54, 59
(La. Ct. App. 2012) (“[A]n employer is at liberty to dismiss an at-will employee
at any time for any reason without incurring liability for the damage.”); Martin v.
Sterling Assocs., Inc., 72 So. 3d 411, 416 (La. Ct. App. 2011) (“An at-will
employee is free to quit at any time without liability to her employer.”); see also
infra Part II.A.
5. Charles J. Muhl, The Employment-at-Will Doctrine: Three Major
Exceptions, M
ONTHLY LAB. REV., Jan. 2001, at 3.
6. John Devlin, Reconsidering the Louisiana Doctrine of Employment at
Will: On the Misinterpretation of Article 2747 and the Civilian Case for Requiring
“Good Faith” in Termination of Employment, 69 T
UL. L. REV. 1513, 1514 (1995);
see also LaBove v. Raftery, 802 So. 2d 566, 582 (La. 2001) (“Employers cannot
be required to continue to employ workers who are under-productive and/or
ineffective.”).
2016] COMMENT 925
employer should be liable to a prospective employee for withdrawing an
offer of at-will employment.
7
A.
Jurisdictions that Allow a Wronged Prospective Employee a Cause of
Action
Multiple states allow an aggrieved prospective employee a chance to
recover when the employer has revoked his or her offer of employment.
8
States that find the employer liable generally do so on the basis of
promissory estoppel.
9
The idea of promissory estoppel is that a promise
can become legally binding when one acts on that promise to his or her
detriment.
10
Although the basic premise is consistent, jurisdictions vary on
the reasons they allow promissory estoppel for rescinded employment
offers.
In one of the most well-known cases on this issue, the Minnesota
Supreme Court in Grouse v. Group Health Plan, Inc.
11
held that the
prospective employee, Grouse, could recover reliance damages on the
basis of promissory estoppel.
12
Grouse was originally employed as a
7. Many jurisdictions have splits among their intermediate appellate courts,
and some jurisdictions are silent on the issue. See May, 928 So. 2d at 147; Goff-
Hamel v. Obstetricians & Gynecologists, P.C., 588 N.W.2d 798, 802 (Neb. 1999);
Bateman, supra note 1 (outlining the general approaches taken by states); David
K. Lucas, Note, Unreasonably Reasonable Reliance: Prospective At-Will
Employment and Promissory Estoppel in Goff-Hamel v. Obstetricians &
Gynecologists, P.C., 79 N
EB. L. REV. 199 (2000) (discussing various state cases
that come out on both sides of the issue); M
ARK A. ROTHSTEIN ET AL.,
EMPLOYMENT LAW 830 (4th ed. 2010) (noting that courts have only “sometimes”
invoked promissory estoppel in this context).
8. See, e.g., Grouse v. Group Health Plan, Inc., 306 N.W.2d 114 (Minn.
1981).
9. Bateman, supra note 1, at § 2(a) (“In order for there to be liability based
on promissory estoppel, the prospective employee must have detrimentally relied
on the promised employment, and such reliance was usually found where an
employee quit a prior job or incurred expenses in relocating in order to begin
promised employment.”).
10. The basic formulation for the theory can be found in the Restatement
(Second) of Contracts, which states:
A promise which the promisor should reasonably expect to induce action
or forbearance on the part of the promisee or a 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.
R
ESTATEMENT (SECOND) OF CONTRACTS § 90(1) (1981).
11. 306 N.W. 2d 114.
12. Id. at 116.
926 LOUISIANA LAW REVIEW [Vol. 76
pharmacist at Richter Drug in Minneapolis.
13
He later interviewed for a
new position with Group Health, which offered him an at-will job at one
of its clinics.
14
Based on this offer, Grouse put in his two-weeks notice
with Richter Drug and turned down a job offer that he had received from
another employer.
15
To be hired at Group Health, Grouse had to pass a
background check, and Group Health needed to obtain a favorable written
reference on his behalf.
16
After having already offered Grouse the job,
Group Health was unable to receive a favorable reference for him and, as
a result, hired someone else.
17
When Grouse called and informed Group
Health that he was ready to begin work, Group Health told him that the
position had already been filled.
18
Consequently, Grouse suffered wage
losses and struggled to find new full-time employment.
19
According to the Minnesota Supreme Court, Grouse was not barred
from using promissory estoppel to enforce Group Health’s offer of
employment.
20
The court noted that Group Health knew that Grouse
resigned from his then-current employment.
21
Taking this into account, the
court stated that “[u]nder these circumstances it would be unjust not to
hold Group Health to its promise.”
22
Finally, the Grouse court stressed that
its conclusion would not hold an employer liable when it terminated any
at-will employee, but rather “under the facts of this case the appellant had
a right to assume he would be given a good faith opportunity to perform
his duties to the satisfaction of respondent once he was on the job.”
23
Likewise, an Indiana appellate court allowed a plaintiff to sue on the
basis of promissory estoppel in Pepsi-Cola General Bottlers, Inc. v.
Woods.
24
Pepsi hired Woods to an at-will position following an
interview.
25
Before this, Woods had been employed at two different
places, and Pepsi advised her that she would need to resign from those jobs
before accepting its offer.
26
After she resigned, but before she began work,
13. Id. at 115.
14. Id.
15. Id.
16. Id. at 115–16.
17. Id. at 116.
18. Id.
19. Id.
20. Id.
21. Id.
22. Id.
23. Id.; see also Gorham v. Benson Optical, 539 N.W.2d 798, 801–02 (Minn.
Ct. App. 1995).
24. 440 N.E.2d 696 (Ind. Ct. App. 1982).
25. Id. at 696.
26. Id.
2016] COMMENT 927
Pepsi informed Woods that the company would no longer hire her.
27
Pepsi
became concerned because Woods’s boyfriend worked at Coca-Cola,
which could pose a potential security problem.
28
After two weeks, she
found employment at Ramada Inn, and over the course of 26 weeks, she
made $800 less than she would have made with Pepsi.
29
Pepsi defended the action on the grounds that it could not be liable to
Woods due to the at-will employment doctrine.
30
The court rejected this
argument stating, “[w]e have no difficulty in finding that Woods has a
right of action under promissory estoppel; clearly Woods quit her former
employment in reliance upon a promise of employment with Pepsi.”
31
Although Woods was eventually unable to show the damages necessary to
recover under the theory, the court acknowledged a cause of action based
on promissory estoppel.
32
In contrast to Minnesota and Indiana courts that applied promissory
estoppel to potentially hold an employer liable, courts in other jurisdictions
have held that the at-will employment doctrine should not control. Those
courts reason that a promise to employ is a separate and distinct contract
from the actual employment contract.
33
The courts’ disregard of the at-will
employment doctrine is supported by the following loophole available to
employers: an at-will employer who fires an employee on the first day has
fulfilled the promise of employment, whereas one who withdraws the offer
27. Id. at 697.
28. Id.
29. Id. The court also noted in its opinion that the working conditions at
Ramada Inn were “less than desirable,” but the court did not provide any further
details. Id. The 26 weeks accounts for the amount of time that it took her to find
other employment at the same pay rate Pepsi had offered her. Id.
30. Id.
31. Id. at 699; see also Peck v. Imedia, Inc., 679 A.2d 745, 753 (N.J. Super.
Ct. App. Div. 1996) (“We believe that plaintiff should be permitted to proceed to
trial on her promissory estoppel claim.”).
32. Pepsi-Cola, 440 N.E.2d. at 699.
33. See Comeaux v. Brown & Williamson Tobacco Co., 915 F.2d 1264, 1270
(9th Cir. 1990) (“By its own terms, the portion of the contract set forth in the
writing did not begin to govern termination of the employment relationship until
B & W assigned Comeaux work and a salary. . . . We must look, instead, to the
terms set forth in Comeaux’s telephone conversation with B & W’s hiring
manager on the day B & W offered Comeaux employment in order to determine
the terms of the relationship prior to when the ‘at will’ provision was to take
effect.” (emphasis in original)); Hackett v. Foodmaker, Inc., 245 N.W.2d 140, 142
(Mich. Ct. App. 1976) (“[I]f a contract was proven by plaintiff that he was to
become manager of the Ypsilanti store and was prevented from so doing due to
defendant’s repudiation thereof prior to the time any services were commenced,
plaintiff has a right to recover.”).
928 LOUISIANA LAW REVIEW [Vol. 76
before the employee commences work has not.
34
Regardless of the reason,
each approach these jurisdictions have taken that provides an employee
with a cause of action attempts to protect the prospective employee from
injustice and to hold employers accountable for their actions. As one
California court explained, “an employer cannot expect a new employee
to sever his former employment and move across the country only to be
terminated before the ink dries on his new lease, or before he has had a
chance to demonstrate his ability to satisfy the requirements of the job.”
35
If the plaintiff is granted relief, the remedy available to the plaintiff is
the recovery of reliance damages.
36
The Restatement (Second) of
Contracts states that these damages “includ[e] expenditures made in
preparation for performance or in performance, less any loss that the party
in breach can prove with reasonable certainty the injured party would have
suffered had the contract been performed.”
37
The reliance damages
stemming from a withdrawal of an offer of employment depend on the
specific acts of reliance in each case but could include moving expenses,
lost wages from previous employment, or the costs sustained by the
prospective employee if unemployed for a period of time.
38
As the
Nebraska Supreme Court explained:
[T]he damages sustained by an employee who quits current
employment to accept another job are different than the damages
sustained by an employee who had no prior employment but may
have moved to a new location in reliance upon a job offer. In the
latter case, wages from prior employment are not considered in
the determination of damages because the party did not give up
prior employment in reliance upon the new offer.
39
34. Bower v. AT&T Techs., Inc., 852 F.2d 361, 364 (8th Cir. 1988) (“In the
former case [post commencement], the employer has completely fulfilled his
promise; in the latter [prior to commencement], the promise has not been kept in
any respect.” (emphasis in original)).
35. Sheppard v. Morgan Keegan & Co., 266 Cal. Rptr. 784, 787 (Ct. App.
1990).
36. Pepsi-Cola, 440 N.E.2d at 699 (“Promissory estoppel would have entitled
Woods to damages for expenses incurred in reliance on Pepsi’s promise.”).
37. R
ESTATEMENT (SECOND) OF CONTRACTS § 349 (1981).
38. See, e.g., Goff-Hamel v. Obstetricians & Gynecologists, P.C., 588
N.W.2d 798, 805 (Neb. 1999) (“In any event, the amount of damages to be
awarded, if any, is a question of fact to be determined from the circumstances of
each case, i.e., as justice requires.”).
39. Id.
2016] COMMENT 929
This remedy does not include, however, damages based on what the
rescinding company was to pay the during future employment.
40
The
justification behind this policy is that at the time actual employment
commences, the employee becomes an at-will employee who could be
terminated at any time.
41
Also, the prospective employee has a duty to seek
other suitable employment in a timely fashion to mitigate any damages.
42
B. Jurisdictions that Do Not Allow a Wronged Prospective Employee a
Cause of Action
Alternatively, numerous jurisdictions refuse to allow prospective
employees a cause of action when an employer has withdrawn an offer of
employment after the employee has detrimentally relied on that offer.
43
The courts in these jurisdictions generally hold that allowing a prospective
employee a cause of action before the employment period is illogical
because, due to the at-will employment doctrine, the employee could be
fired on the very first day of the job and have no recourse.
44
Some of these
40. The notion that an employee is only entitled to reliance damages to the
exclusion of future wages has been reiterated by the Proposed Final Restatement
of Employment Law, which states:
If, however, the employer promised the employee or prospective employee
employment that, however attractive the compensation and other terms,
would be terminable without cause, and the employee reasonably relies to
his detriment on such a promise, the affected employee has a claim only
for limited reliance damages, such as relocation costs, because no
particular period of employment with the employer was promised.
R
ESTATEMENT OF EMPLOYMENT LAW § 9.01 cmt. i (2014).
41. See Goff-Hamel, 588 N.W.2d at 805 (“In neither case are damages to be
based upon the wages the employee would have earned in the prospective
employment because the employment was terminable at will.”); Grouse v. Grp.
Health Plan, Inc., 306 N.W.2d 114, 116 (Minn. 1981) (“Since, as respondent
points out, the prospective employment might have been terminated at any time,
the measure of damages is not so much what he would have earned from
respondent as what he lost in quitting the job he held and in declining at least one
other offer of employment elsewhere.”).
42. See, e.g., Monteleone v. First State Bank & Trust Co., 477 So. 2d 130,
133 (La. Ct. App. 1985) (“Under the doctrine of mitigation of damages an injured
person has a duty to exercise reasonable diligence and ordinary care in attempting
to minimize his damages after an injury has been inflicted.”).
43. See, e.g., Morsinkhoff v. De Luxe Laundry & Dry Cleaning Co., 334
S.W.2d 639 (Mo. Ct. App. 1961).
44. A South Carolina federal district court adopted this position stating:
[T]o hold otherwise would create an anomalous result and would
undermine the doctrine of employment at-will in this state. If an employee
such as plaintiff is permitted to recover damages from a potential employer
that breaks a promise of at-will employment before the employee begins
930 LOUISIANA LAW REVIEW [Vol. 76
jurisdictions refuse to allow a claim based on promissory estoppel, arguing
that the type of risks that come with leaving one job for another are a
normal part of the employment process.
45
For example, in Morsinkhoff v. DeLuxe Laundry & Dry Cleaning Co.,
a Missouri Court refused to recognize the prospective employee’s
promissory estoppel claim.
46
Morsinkhoff originally worked as a plant
engineer for five years at Crawford Manufacturing Company, but seeking
to improve his employment opportunities, he interviewed at DeLuxe.
47
During this interview with two employees, Morsinkhoff discussed various
aspects of DeLuxe’s business including the company’s future plans and
starting salaries.
48
Although the nature of the agreement reached during
this meeting was subject to some debate, Morsinkhoff clearly was under
the impression that he had been offered employment at DeLuxe for a
period of one year for a salary of $10,000.
49
He believed the new job would
start after he resigned from his then current position, and as a result, he
gave his current employer a month’s notice of his decision to resign.
50
Before his starting date, but after resignation, Morsinkhoff was informed
that “the whole deal was off,” and that DeLuxe had changed its mind.
51
DeLuxe’s withdrawal left Morsinkhoff unemployed for two months.
52
In rendering its decision, the court first established that the
employment in this particular case would have been at will.
53
After
deciding this, the court denied Morsinkhoff his promissory estoppel
claim
54
because the court found that allowing Morsinkhoff recovery
during this interim period would be illogical when, due to the at-will
employment doctrine, he would be without remedy if the termination
occurred on the first day of his employment.
55
The court also contended
to work, then the employee would be placed in a better position than an
employee whose at-will employment is terminated at some point after he
begins working since the courts of this state have expressly denied
recovery on many occasions in the latter situation.
White v. Roche Biomedical Labs., Inc., 807 F. Supp. 1212, 1220 (D.S.C. 1992).
45. See, e.g., Marrero v. McDonnell Douglas Capital Corp., 505 N.W.2d 275,
278 (Mich. Ct. App. 1993) (“[R]esignation from one position to assume another
and relocation of family would be customary and necessary incidents of changing
jobs rather than consideration to support a promissory estoppel claim.”).
46. 344 S.W.2d 639.
47. Id. at 640.
48. Id.
49. Id.
50. Id. at 640–41.
51. Id. at 641.
52. Id.
53. Id. at 642.
54. Id. at 643–44.
55. Id. at 643.
2016] COMMENT 931
that invoking promissory estoppel in this context was merely an attempt
to out-maneuver Missouri’s at-will employment doctrine.
56
These cases serve to highlight the difficulty some courts have had
when faced with a potential conflict to their state’s at-will employment
doctrine. Strict adherence to the doctrine and ignoring the validity and
usefulness of promissory estoppel to revoke an offer of employment,
however, has led to the miscarriage of justice in many situations.
C.
Louisiana’s Misguided Approach
Currently, Louisiana’s published jurisprudence on this issue is sparse.
Louisiana’s approach thus far, however, aligns with the jurisdictions that
deny employees a cause of action when an employer reneges on an offer
of at-will employment.
57
The first recorded decision that directly
confronted this issue was May v. Harris Management Corp. in 2005.
58
1. A First Take: May v. Harris Management Corp.
In May, an owner and operator of nursing homes, Harris Management
Corporation (“HMC”), offered May a position as the nursing home
administrator at one of its homes.
59
May was employed at the time of the
offer and had to resign before accepting HMC’s offer of employment.
60
On her last day at her prior job, May filled out various employment
documents at the HMC nursing home.
61
Five days before May was to
begin her employment at HMC, the company informed her that it was
withdrawing its offer.
62
By this point, May was unable to return to her
previous job.
63
She later brought suit, seeking damages on the basis of
detrimental reliance because she resigned from her previous employment
as a result of HMC’s offer.
64
The Louisiana First Circuit Court of Appeal
ultimately held that, “it is unreasonable as a matter of law to rely on an
56. Id.
57. See supra note 1.
58. 928 So. 2d 140, 144 (La. Ct. App. 1st 2005) (“In this case, we must decide
a res nova legal issue in Louisiana: whether recovery is allowed under the doctrine
of detrimental reliance when an employer withdraws an offer of at-will
employment prior to the designated time for the employee to begin work.”).
59. Id. at 143.
60. Id.
61. Id.
62. Id.
63. Id.
64. Id.
932 LOUISIANA LAW REVIEW [Vol. 76
offer of at-will employment, just as it is patently unreasonable to rely on
the permanency of at-will employment once it begins.”
65
a. The May Majority’s Faulty Rationale
The court began its analysis by stating that “[i]t is difficult to recover
under the theory of detrimental reliance, because estoppel is not favored
in our law.”
66
The court then emphasized the strength of the at-will
employment doctrine in Louisiana.
67
Further, the court noted that nothing
in the record indicated the existence of a bargained-for exchange between
the parties or that May provided any additional consideration for the
employment agreement.
68
Next, because this case presented a matter of
first impression in Louisiana, the court inquired into positions taken by
other jurisdictions.
69
After analyzing opinions on both sides, the court
declared that in their view, it is “patently unreasonable” to rely on an offer
of at-will employment.”
70
The court believed that to hold otherwise would
undermine Louisiana’s strong at-will employment doctrine.
71
Also, the
court expressed concerns over perverse incentives for employers if
recovery to the plaintiff was allowed. For example, an employer could just
wait until the first day of employment to fire the employee to receive the
full protection of the at-will employment doctrine.
72
The court concluded
that allowing recovery in this context would defy logic, as the prospective
employee would seemingly have more power than one actually working
at the company.
73
b. The May Concurrence’s Apprehensive Rationale
Judge Downing concurred with the May result but only because he did
not believe that May could prove the damages necessary to succeed on a
65. Id. at 148. It is worth noting that two of the judges on the three judge
panel actually disagreed with this statement. Id. at 149–50 (Gaidry, J., dissenting);
Id. at 150–51 (Downing, J., concurring).
66. Id. at 145 (majority opinion).
67. Id. at 145–47.
68. Id. at 146; see also infra Part II.C.1.a (discussing consideration).
69. May, 928 So. 2d at 147 (“As for the cases involving at-will employment
offers being withdrawn before the employee actually begins work, we must look
outside of Louisiana to cases with similar facts.” (emphasis in original)). For
examples of these rationales see supra Part I.A–B.
70. May, 928 So. 2d at 148.
71. Id.
72. Id. (“[I]t would inevitably result in employers actually waiting until the
employee starts work before terminating them . . . .”).
73. Id. The court was worried over this purported illogical result:
2016] COMMENT 933
detrimental reliance claim because after HMC withdrew its offer, May
found other employment with a higher rate of pay than her previous job.
74
Yet Judge Downing disagreed with the majority’s reasoning, arguing that
“[i]t seems to me patently absurd that we could find it patently
unreasonable for an employee to rely on an offer of at-will employment
when the employee cannot accept the offer without leaving secure
employment and incurring expenses.”
75
Judge Downing further explained
that he based his conclusion on the inherent differences between being
actually employed and having agreed to employment but not yet having
commenced work. In particular, he noted the individual’s understanding
of the risks involved in the process.
76
He also argued that calling this type
of reliance unreasonable is essentially the same as saying the assumption
that employers act in bad faith is reasonable.
77
For these reasons, he
concluded that “[a] prospective employee should be able to collect
damages for costs of moving and other provable damages as a result of a
breach of promise on which a normally reasonable person would rely.”
78
c. The May Dissent’s Well-Reasoned Rationale
Judge Gaidry in dissent disagreed with the main holding of the court’s
opinion.
79
He believed that applying the at-will employment doctrine to a
It would be an anomalous result if employers who had already decided
to terminate an employee could avoid liability simply by waiting for the
actual employment to begin, whereas if they withdraw an offer of
employment before the prospective employee starts working, they are
faced with liability for detrimental reliance claims.
Id.
74. Id. at 151 (Downing, J., concurring).
75. Id. at 150.
76. Id. at 150–51 (“Common sense and experience demonstrate that people
seeking new employment for whatever reason know that risk is involved in the
employment, but not in the acceptance of the employment. . . . [W]hile the ‘at-
will’ doctrine precludes damages for actual lost employment, the ‘at-will’ doctrine
does not apply to a party who is not yet an employee.”).
77. Id. at 151. In fact, Judge Downing believed that employers actually
generally act in good faith. He explained:
When we say that it is unreasonable as a matter of law for an employee
to rely on a promise of employment, we say that it is reasonable for
employees to expect employers to breach their promises and act in
reckless disregard of the prospective employees’ welfare. I believe the
contrary: that employers generally act honorably and in good faith. I
therefore believe that it is highly reasonable to rely on an employer’s
promise of employment.
Id.
78. Id.
79. Id. at 149–50 (Gaidry, J., dissenting).
934 LOUISIANA LAW REVIEW [Vol. 76
prospective employee was legal error.
80
Instead, Judge Gaidry found that
detrimental reliance was the proper remedy when a prospective employee
relied to his or her detriment on an offer of employment.
81
He also pointed
out that the majority’s discussion of consideration was misplaced because
“[Louisiana Civil Code article] 1967 does not define ‘cause’ in terms of
‘consideration,’” that is “in terms of obtaining something in return for
binding oneself.”
82
Judge Gaidry explained that all May had to prove were
the elements necessary for a detrimental reliance claim, and, according to
Judge Gaidry, May had done so.
83
Importantly, Judge Gaidry also
addressed the argument that allowing prospective employee a cause of
action is absurd when that same employee would be barred from bringing
a claim due to the at-will doctrine
if fired on the first day of employment.
He wrote: “Would the result be different and anomalous if HMC had
terminated Ms. May’s employment the day after she started, with no
consequent liability? It certainly might appear so, but the line must be
drawn somewhere.”
84
2. Another Chance: Bains v. The Young Men’s Christian Ass’n of
Greater New Orleans, Louisiana
Although the First Circuit’s holding in May is generally cited as the
rule in Louisiana,
85
the Louisiana Fourth Circuit Court of Appeal had an
opportunity to decide a similar case just two years later in Bains v. The
Young Men’s Christian Ass’n of Greater New Orleans, Louisiana.
86
The
trial court granted YMCA’s exception of no cause of action,
87
which cited
to the May decision for support.
88
The Fourth Circuit refused to follow
May’s holding that reliance on an offer of at-will employment is
unreasonable as a matter of law.
89
The Fourth Circuit reversed the lower
80. Id. at 150.
81. Id. (“[S]uch a conclusion is an unwarranted extension of the at-will
employment principal to a classic factual scenario of detrimental reliance
governed by [Louisiana Civil Code article] 1967.”).
82. Id. This is of particular importance because unlike in common law states,
Louisiana does not abide by the doctrine of consideration. Instead, Louisiana uses
the doctrine of cause. See infra Part II.C.1.b (discussing cause).
83. May, 928 So. 2d at 150 (Gaidry, J., dissenting).
84. Id. at 150.
85. See supra note 1.
86. 969 So. 2d 646 (La. Ct. App. 4th 2007).
87. Id. at 647.
88. Id. at 650.
89. Id. at 652; but see id. (Armstrong, J., dissenting) (“Present Louisiana case
law finds that it is inherently unreasonable to rely on an offer of at-will
employment.”).
2016] COMMENT 935
court’s opinion and remanded the case for further proceedings.
90
Unfortunately, however, the court failed to justify or explain its decision,
merely referencing some potential problems with the May decision.
91
In the case, Bains began discussing new employment opportunities
with YMCA.
92
As a result of these discussions, Bains was offered the
position of director of development, with a starting salary that was $25,000
more per year than her current one.
93
YMCA’s CEO confirmed to Bains
that the offer was legitimate on multiple occassions.
94
Bains also received
an email from the CEO stating that if she wanted the job, she could start
on June 6.
95
Consequently, Bains resigned from her then-current
employment.
96
When the time came for Bains to finally start working for
YMCA, she was informed that the offered position was no longer available
and that it may not become available until the fall.
97
As a result, Bains
remained unemployed for seven months.
98
Bains then brought suit,
seeking damages due to her detrimental reliance on YMCA’s promise of
employment.
99
Unlike May,
100
the Bains court began its analysis by acknowledging
the codification of detrimental reliance in the Louisiana Civil Code,
101
as
well as discussing some traditional civilian doctrines for the enforcement
of cases on the basis of reliance.
102
In a similar fashion to Judge Gaidry’s
dissent in May, the court also stated that discussions of consideration are
90. Id. (majority opinion).
91. In its explanation the court stated:
Therefore, because it is possible to reconcile the codal articles that at first
blush appear to be in conflict by a thorough analysis of our civil code,
and because there are certain scenarios in which the law may offer Ms.
Bains relief, we reverse the granting of defendant’s exception of no cause
of action and remand for further proceedings in accord with this opinion.
Id. at 652.
92. Id. at 647.
93. Id.
94. Id. (“On no less than three occasions, the CEO reiterated that she was
offered the job.”).
95. The email included the following: “Unless you change your mind after
meeting everyone, I would like you to start on June 6.” Id.
96. Id. at 648.
97. Id.
98. Id.
99. Id.
100. May v. Harris Mgmt. Corp., 928 So. 2d 140, 145 (La. Ct. App. 1st 2005)
(“It is difficult to recover under the theory of detrimental reliance, because
estoppel is not favored in our law.”).
101. L
A. CIV. CODE art. 1967 (2015).
102. Bains, 969 So. 2d at 649 (discussing the doctrines of venire contra factum
proprium non valet and culpa in contrahendo). For more on these doctrines, see
infra Part II.B.1.a.
936 LOUISIANA LAW REVIEW [Vol. 76
improper and that, in Louisiana, the proper inquiry is one of cause.
103
Because the defendant cited May in support of its position,
104
the Fourth
Circuit pointed out deficiencies in the May reasoning.
105
First, the court
explained that May was wrong in following the common law approach of
other jurisdictions instead of consulting the Louisiana Civil Code.
106
In
particular, the court found that the May approach had two major problems:
“one, most other American jurisdictions do not have a Civil Code; and
two, common law jurisdictions allow their judiciary more leeway in
estoppel because of the history of courts in equity.”
107
Citing to May’s
concurring and dissenting opinions, the Fourth Circuit found that the
factual scenario presented in this case was distinguishable from at-will
employment decisions because the plaintiff was not yet employed.
108
Additionally, the court found that Louisiana’s at-will employment
doctrine, embodied in Civil Code article 2747,
109
does not serve as a shield
that protects the employer in every factual scenario and that the article
should be tempered by the underlying duty of good faith.
110
Thus, although May’s holding currently appears to be the accepted
stance in Louisiana when dealing with rescinded offers of employment,
111
the multitude of problems with the decision are well illustrated by the
Louisiana’s Fourth Circuit Court of Appeal in Bains. The problems Bains
highlights—and other unique characteristics of Louisiana’s civil law
system—lead to the conclusion that May’s categorical bar on allowing
prospective employees a cause of action is the incorrect result.
II.
LOUISIANA DOCTRINES SUPPORTING THE EXISTENCE OF
P
RE-EMPLOYMENT CLAIMS: THE AT-WILL EMPLOYMENT DOCTRINE,
DETRIMENTAL RELIANCE, AND CIVIL LAW DISTINCTIONS
Although looking to jurisprudence on this issue is worthwhile,
understanding the concepts and doctrines that underlie those decisions is
even more vital. The fundamental concepts and doctrines unique to
103. Bains, 969 So. 2d at 649; see also infra Part II.C.1.b (discussing cause).
104. Bains, 969 So. 2d at 650.
105. Id. at 650–52.
106. Id.
107. Id. at 650 (“Comparing this approach with the civilian approach,
Louisiana’s judiciary is tied more closely to following the legislature’s mandate
as laid out in the Code.”).
108. Id. at 650–51.
109. L
A. CIV. CODE art. 2747 (2015) (“A man is at liberty to dismiss a hired
servant attached to his person or family, without assigning any reason for so
doing. The servantis also free to depart without assigning any cause.”).
110. Bains, 969 So. 2d at 651–52.
111. See supra note 1.
2016] COMMENT 937
Louisiana’s civil law system further bolster the notion that a prospective
employee who has relied to his or her detriment on an offer of employment
should be granted a cause of action against the rescinding employer.
112
A.
The At-Will Employment Doctrine in Louisiana
At least some version of the at-will employment doctrine is recognized
in all American jurisdictions.
113
In Louisiana, at-will employment has a
strong presence in the law and in jurisprudence,
114
and the state’s
adherence to the doctrine is one of the strongest in the nation.
115
As one
legal scholar explained:
To date, all attempts to persuade Louisiana courts to adopt any of
the increasingly common jurisprudential exceptions have failed.
Thus, Louisiana remains one of the dwindling minority of states
that continues to refuse to recognize any cause of action for
wrongful discharge or any nonstatutory exception to the doctrine of
employment at will, no matter how egregious the circumstances.
116
Louisiana Civil Code article 2747 has become the foundation for
Louisiana’s at-will employment rule. This article states “[a] man is at
liberty to dismiss a hired servant attached to his person or family, without
assigning any reason for so doing. The servant is also free to depart without
assigning any cause.”
117
This at-will relationship between the employer and
employee is contractual in Louisiana.
118
Generally, an employer does not
have to show any reason at all to discharge an employee.
119
Thus, any
challenge that directly tries to weaken the doctrine is unlikely to find much
success in a Louisiana courtroom. Louisiana’s stronghold to at-will
112. See infra Part II.A–C.
113. See generally MELINDA J. CATERINE ET AL., EMPLOYMENT AT WILL: A
STATE-BY-STATE SURVEY (2011) (providing a breakdown of each state’s
doctrine); see also supra Part I.
114. See May v. Harris Mgmt. Corp., 928 So. 2d 140, 145 (La. Ct. App. 1st
2005); Harrison v. CD Consulting, Inc., 934 So. 2d 166, 171 (La. Ct. App. 2006).
115. See Muhl, supra note 5, at 4 (“Three southern States—Florida, Georgia,
and Louisiana—and Rhode Island do not recognize any of the three major
exceptions to employment at will.” (emphasis in original)); see also C
ATERINE ET
AL
., EMPLOYMENT AT WILL: A STATE-BY-STATE SURVEY 19-2 (Supp. 2013)
(“Louisiana courts have continued to emphasize Louisiana’s long-term adherence
to the at-will employment doctrine, in the absence of a contract for a fixed term,
and tempered only by federal and state antidiscrimination laws.”).
116. Devlin, supra note 6, at 1523.
117. L
A. CIV. CODE art. 2747 (2015).
118. Quebedeaux v. Dow Chem. Co., 820 So. 2d 542, 545 (La. 2002).
119. Burnett v. E. Baton Rouge Parish Sch. Bd., 99 So. 3d 54, 59 (La. Ct. App.
2012); Saacks v. Mohawk Carpet Corp., 855 So. 2d 359, 364 (La. Ct. App. 2003).
938 LOUISIANA LAW REVIEW [Vol. 76
employment, however, is based on a misinterpretation and misapplication
of 2747.
1. Louisiana Courts’ Misapplication of Article 2747
Although courts rely on Civil Code article 2747 as a basis for the at-
will employment doctrine, the state’s unusually strong stance on the
doctrine is one that developed through the jurisprudence, originally
without reference to the Civil Code.
120
This jurisprudential development is
based on a misunderstanding of the article’s foundation.
121
Before 1962,
Louisiana courts did not interpret article 2747 to apply to ordinary at-will
employees.
122
In the 1920s and 1930s, Louisiana courts began looking to
common law jurisdictions for guidance for how to handle the situation of
a breached promise of at-will employment.
123
The courts then worked this
common-law interpretation of the doctrine into preexisting Civil Code
articles.
124
As one commentator explained, “[o]nly in the early 1960s did
courts begin to focus on article 2747 and the perceived dichotomy between
articles 2747 and 2749
125
as the codal locus of the employment at-will rule
in Louisiana.”
126
In time, the focus landed on article 2747, and, since 1962,
practically all at-will employment decisions have relied on the article as
the basis of the at-will doctrine in Louisiana.
127
120. See Devlin, supra note 6, at 1532–44 (discussing Louisiana’s early
jurisprudence on termination of at-will employees, and the importation of
common law interpretations of the doctrine into the state’s courts).
121. See id. (explaining the history of Civil Code Article 2747 and the reasons
leading up to its ultimate misinterpretation).
122. Professor Devlin argues:
[T]here is no indication that the Louisiana courts originally interpreted
article 2747 to apply to ordinary at will employees or relied on that article
to justify treating the legal rights and obligations of such employees as
an exception to the general rules governing leases or other obligations
terminable at will.
Id. at 1535.
123. Id. at 1535–44.
124. Id.
125. Article 2749 is entitled “Liability for dismissal of laborer without cause,”
and states:
If, without any serious ground of complaint, a man should send away a
laborer whose services he has hired for a certain time, before that time
has expired, he shall be bound to pay to such laborer the whole of the
salaries which he would have been entitled to receive, had the full term
of his services arrived.
L
A. CIV. CODE art. 2749 (2015).
126. Devlin, supra note 6, at 1544.
127. Id.
2016] COMMENT 939
The history of article 2747 leads to the conclusion that the article was
never intended or originally interpreted by the courts to apply broadly to
employment relationships.
128
Instead, the article was only intended to be
applicable to servants living and working within the family they serveda
very narrow class of laborers.
129
Although Louisiana courts have
emphasized this one code article in their insistence on a firm application
of the at-will employment doctrine, they have ignored another important
provision that arguably militates against such a strong rule—the duty of
good faith.
130
2. The Requirement of Good Faith in the At-Will Relationship
The underlying duty of good faith comes from various articles in the
Civil Code.
131
Some scholars, and even some Louisiana courts, have called
for the promise of at-will employment to be treated like any other obligation
in the Civil Code; that is, that the at-will employment relationship be subject
to the underlying duty of good faith.
132
In Louisiana law, no set definition of
what constitutes good faith exists; thus, the words “are used on the general
assumption that everybody understands what they mean.”
133
Notwithstanding the history and likely misuse of Civil Code article
2747, if one analyzes the construction of the article in the at-will
128. Id. at 1569, 1571 (“Louisiana cases from the nineteenth century clearly
indicate that the predecessors of present article 2747 were originally understood
in the traditional manneras applying only to a narrowly defined category of
servants.”).
129. Id. at 1571.
130. See, e.g., Stanton v. Tulane Univ., 777 So. 2d 1242, 1251 (La. Ct. App.
2001) (“[Plaintiff] would rely on jurisprudence in other states that he contends
creates a ‘covenant of good faith and Fair Dealing’ exception to employment at
will . . . . [This concept remains] foreign to the scheme of Louisiana employment
law.”).
131. See L
A. CIV. CODE art. 1759 (2015) (“Good faith shall govern the conduct
of the obligor and the obligee in whatever pertains to the obligation.”); id. art.
1983 (“Contracts have the effect of law for the parties and may be dissolved only
through the consent of the parties or on the grounds provided by law. Contracts
must be performed in good faith.”).
132. See Allbritton v. Lincoln Health Sys., Inc., 51 So. 3d 91, 96 (La. Ct. App.
2010) (“Although Louisiana is an at-will employment state, employer has a duty
of good faith.”). For another state’s perspective, see Peck v. Imedia, Inc., 679 A.
2d 745, 753 (N.J. Super. Ct. App. Div. 1996) (“[T]he doctrine of ‘good faith and
fair dealing’ applies where there is some type of employment contract, even if it
is merely ‘at will.’”). See generally Devlin, supra note 6, at 1599 (“If applied, as
it should be, to at-will employment contracts, this duty of good faith would permit
Louisiana to retain the substance of the rule of employment at will, while ridding
the system of its worse abuses.”).
133. S
AÚL LITVINOFF, THE LAW OF OBLIGATIONS § 1.8, in 5 LOUISIANA CIVIL
LAW TREATISE 17 (1992).
940 LOUISIANA LAW REVIEW [Vol. 76
employment context, the argument that good faith should apply to the
employer-employee relationship is strengthened. The at-will employment
relationship is a conditional obligation
134
subject to a resolutory condition
because it immediately ends with the discharge of employment.
135
As a
resolutory condition that depends solely on the will of the obligor, the
employer, or the employee, must perform in good faith.
136
In addition, as
the Bains court pointed out, to comply with the requirement of good faith
when terminating an at-will contract, one “should consider not only his
own advantage but also the hardship to which the other party will be
subjected because of the termination.”
137
It has even been argued that failing to comply with this duty of good
faith in the at-will context may trigger the civilian doctrine of “abuse of
rights.”
138
However, the abuse of rights argument has not been successful
in this context so far.
139
134. LA. CIV. CODE art. 1767 (“A conditional obligation is one dependent on
an uncertain event.”). The uncertain event in this context is the decision made by
the employee or employer to terminate the employment relationship. This could
happen tomorrow, or their relationship might last for the entire existence of the
business.
135. Id. (“If the obligation may be immediately enforced but will come to an
end when the uncertain event occurs, the condition is resolutory.”).
136. Id. art. 1770 (“A resolutory condition that depends solely on the will of
the obligor must be fulfilled in good faith.”).
137. Bains v. Young Men’s Christian Ass’n of Greater New Orleans, 969 So.
2d 646, 651 (La. Ct. App. 4th 2007); see also L
A. CIV. CODE art. 1770 cmt. f
(“[T]ermination because of purely personal rather than business reasons could
constitute bad faith.”).
138. As explained by the Louisiana Supreme Court:
The Abuse of Rights doctrine is a civilian concept which is applied only
in limited circumstances because its application renders unenforceable
one’s otherwise judicially protected rights. . . . The Abuse of Rights
doctrine has been applied only when one of the following conditions is
met:
(1) if the predominant motive for it was to cause harm;
(2) if there was no serious or legitimate motive for refusing;
(3) if the exercise of the right to refuse is against moral rules, good faith,
or elementary fairness;
(4) if the right to refuse is exercised for a purpose other than that for
which it is granted.
Truschinger v. Pak, 513 So. 2d 1151, 1154 (La. 1987); see also Mohamed Yehia
Mattar, Promissory Estoppel: Common Law Wine in Civil Law Bottles, 4 T
UL.
CIV. L.F. 71, 120 (1988).
139. 6 EMPLOYMENT DISCRIMINATION COORDINATOR § 22:3 (West 2013)
(“[T]he doctrine has yet to be successfully asserted in Louisiana as a basis for
challenging decisions to terminate at-will employment.”).
2016] COMMENT 941
B. The Evolution of Detrimental Reliance in Louisiana
As the Bains court explained, “[t]he detrimental reliance theory is a
general part of the Civil Law and springs forth from the idea that in a civil
society people should keep their word.”
140
Despite the differing
terminology, the Louisiana theory of detrimental reliance is in large part
the same as the promissory estoppel theory that common law states use.
141
Common law states base their theories of promissory estoppel on Section
90 of the Restatement (Second) of Contracts.
142
On the other hand,
Louisiana’s theory of detrimental reliance is found in article 1967 of the
Civil Code.
143
1. Pre-Civil Code Article 1967
Detrimental reliance has quite an extensive history not only in
Louisiana’s civilian heritage but also in the state’s jurisprudence.
144
In
1984, Louisiana’s detrimental reliance theory was codified in Civil Code
article 1967.
145
140. Bains, 969 So. 2d at 650.
141. See Jon C. Adcock, Comment, Detrimental Reliance, 45 LA. L. REV. 753,
753 (1985) (“The theory of detrimental reliance is embodied in the theory of
promissory estoppel.”); Amos J. Oelking, III, Morris v. Friedman: Detrimental
Reliance and Statutory Writing Requirements, 57 L
A. L. REV. 1375, 1377 (1997)
(“[T]he common law doctrine of promissory estoppel is the primary source of
detrimental reliance in Louisiana Civil Code article 1967.”); Mattar, supra note
138, at 137 (“Apparently, the drafters of the code were influenced by the Restaters
in formulating Louisiana’s provisions on detrimental reliance.”).
142. Mattar, supra note 138, at 137 (“Under Section 90 of the Restatement,
which is followed by almost all jurisdictions in the United States . . . .”);
R
ESTATEMENT (SECOND) OF CONTRACTS § 90 (1981) (“A promise which the
promisor should reasonably expect to induce action or forbearance on the part of
the promisee or a 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.”).
143. L
A. CIV. CODE art. 1967 (2015).
144. See, e.g., David V. Snyder, Comparative Law in Action: Promissory
Estoppel, the Civil Law, and the Mixed Jurisdiction, 15 A
RIZ. J. INT’L & COMP.
L. 695, 698 (1998) (“Louisiana and the civil law have protected reliance in various
ways for a long time.”); Mattar, supra note 138, at 72 (“That one should be
precluded from contradicting his own acts or words when they have been relied
on by another to his detriment is a well recognized principle in civil law.”).
145. Louisiana Civil Code article 1967 became effective on January 1, 1985.
942 LOUISIANA LAW REVIEW [Vol. 76
a. Historic Civil Law Roots
The Anglo-American common law did not originate the theory of
promissory estoppel, as a form of the doctrine had already existed for
centuries in the civil law.
146
The two civilian theories are the Roman
principle venire contra factum proprium—no one is allowed to go against
the consequences of his own act—and the German doctrine of culpa in
contrahendo—fault in contracting.
147
Louisiana courts have acknowledged and applied these two theories.
148
For example, one court has held on the basis of venire contra factum
proprium non valet
“that our lessor cannot be allowed to evict our lessee
for failing to actually spend the withheld rent on repairs when it was the
lessor herself who importuned the lessee to delay those repairs.”
149
Thus,
detrimental reliance is a well-established civilian concept that has taken
146. As explained by Shael Herman:
Anglo-American jurisprudence did not invent detrimental reliance as a
substitute for consideration or a basis for enforcement. On the continent,
it already had long and venerable antecedents before the Norman
Conquest. It appeared in Roman texts, and so venerable was the idea of
detrimental reliance that it even acquired its own Latin maxim: venire
contra proprium factum (no one can contradict his own act).
Shael Herman, Detrimental Reliance in Louisiana Law–Past, Present, and Future
(?): The Code Drafter’s Perspective, 58 T
UL. L. REV. 707, 714 (1984); see also
Snyder, supra note 144, at 712 n.100.
147. Adcock, supra note 141, at 755–56. For a more in-depth discussion of the
two theories see Mattar, supra note 138, and Bains v. Young Men’s Christian
Ass’n of Greater New Orleans, 969 So. 2d 646, 649 (La. Ct. App. 4th 2007).
Venire contra factum proprium is sometimes referred to as the longer venire
contra factum proprium non valet. Compare Tex. E. Transmission Corp. v.
Amerada Hess Corp., No. CIV. A. 97–0518, 1997 WL 613125, at *11 (E.D. La.
1997), with Sanders v. United Distributors, Inc., 405 So. 2d 536, 537 (La. Ct. App.
1981).
148. See Coleman v. Bossier City, 305 So. 2d 444, 447 (La. 1974) (discussing
culpa in contrahendo but holding under the circumstances there was no need to
decide whether or not the theory would be applicable); Hebert v. McGuire, 447
So. 2d 64, 65 (La. Ct. App. 1984) (“If the promise had come after the debt for
surgery was incurred, it would be a clearer case of a gratuitous promise, as to
which estoppel (or the civil law doctrine against contravening one’s own acts)
would, however, reasonably apply . . . .” (emphasis in original)); Saúl Litvinoff,
Still Another Look at Cause, 48 L
A. L. REV. 3, 22 (1987) (“[T]he Louisiana
jurisprudence, in a clear manner, has traced the ancestry of reliance as basis for
obligation back to the civilian venire contra factum proprium.”); but see Sanders,
405 So. 2d at 537 n.2 (“This writer has not found an instance of Louisiana’s
expressly utilizing the civil law principle venire contra factum proprium non
valet.”).
149. Davilla v. Jones, 418 So. 2d 724, 725 (La. Ct. App. 1982). But this decision
was later overruled by the Louisiana Supreme Court with no mention of the
doctrine. Davilla v. Jones, 436 So. 2d 507 (La. 1983).
2016] COMMENT 943
hold in Louisiana. There are examples of Louisiana courts allowing
recovery under theories of detrimental reliance dating back to over a
century.
150
For example, in the 1896 case of Choppin v. LaBranche, a
plaintiff’s action succeeded under the principle of estoppel.
151
In Choppin,
the defendant attempted to remove the remains of the plaintiff’s ancestor
from a tomb that the defendant owned despite previously promising the
plaintiff that he would not.
152
The Louisiana Supreme Court granted the
plaintiff’s injunction to restrain the removal of the remains and held, “[t]he
principle of estoppel, so often applied, in controversies involving
pecuniary rights, will not permit the withdrawal of promises or
engagements on which another has acted. It seems to us that the principle
can well be applied in this controversy.”
153
b. Ducote v. Oden: Louisiana Supreme Court’s Questionable
Rejection of Promissory Estoppel
Despite the apparent civilian roots of detrimental reliance, in 1952, the
Louisiana Supreme Court in Ducote v. Oden held that promissory estoppel
had no place in the state’s law.
154
There, Ducote alleged that he and Oden
entered into an agreement under which Ducote was to remove the layer of
dirt covering Oden’s gravel pit.
155
The alleged agreement was to last for a
period no less than three years.
156
Even with these alleged terms, Oden
declared the contract was to be terminated after a period of about six
months from when Ducote commenced the work.
157
As a result, Ducote
sought damages based on the estimated profit he would have made over
the remainder of the term as well as damages stemming from the cost of
moving machinery to the site.
158
Ducote was forced to turn to the theory
of promissory estoppel when he was unable to produce evidence of the
contract with Oden.
159
The Court rejected this theory, holding that
“[promissory estoppel] is unknown to our law, and counsel has not
attempted to show its applicability under the provisions of the Civil Code,
by which we are bound in suits of this type.”
160
150. Oelking, supra note 141, at 1377; Herman, supra note 146, at 715.
151. 20 So. 681 (La. 1896).
152. Id. at 681–82.
153. Id. at 682.
154. 59 So. 2d 130 (La. 1952).
155. Id. at 130.
156. Id.
157. Id.
158. Id.
159. Id. at 131.
160. Id. at 132. The Louisiana Supreme Court has since reaffirmed that prior
to article 1967, promissory estoppel was not a recoverable theory in Louisiana.
944 LOUISIANA LAW REVIEW [Vol. 76
Some have argued that the holding was based largely on the fact that
the Louisiana Supreme Court saw promissory estoppel as an unwarranted
intrusion by the common law into the state.
161
These commentators praised
the court’s decision not to follow the Restatement (Second) of Contracts
section 90.
162
The court may have reached a different conclusion had the
plaintiff based his argument on traditional civilian theories instead. As one
commentator speculated, “[o]ne may wonder if the Louisiana Supreme
Court would have been equally hostile to the plaintiff’s claim if he had
invoked the venerable Roman maxim, venire contra proprium factum,
instead of the Restatement (Second) of Contracts section 90.”
163
Ducote’s
progeny is what led the May majority to declare that detrimental reliance
is not favored under Louisiana law and that recovering under the theory is
difficult.
164
2. A Defining Moment: Louisiana Legislature’s Codification of
Article 1967
Although the civil law’s historic take on detrimental reliance and the
Louisiana jurisprudence on the matter is important, the most critical part
See Morris v. Friedman, 663 So. 2d 19, 26 (La. 1995) (“[P]rior to the enactment
of [Louisiana Civil Code article] 1967, the common law theory or promissory
estoppel had been expressly rejected by this Court.”).
161. See Herman, supra note 146, at 716 (“Louisiana courts have not been
uniformly receptive to an aggrieved party’s invocation of detrimental reliance,
particularly when it has been overtly characterized as the promissory estoppel of
the Restatement of Contracts.”); Mattar, supra note 138, at 84 (“Louisiana courts
have been even less receptive to the idea of detrimental reliance as a basis of
liability when expressed in common-law estoppel terms.”).
162. Professor J. Denson Smith proclaimed, “[i]t is heartening that our court
is not willing to succumb to its wiles.” Herman, supra note 146, at 717 (citing J.
Denson Smith, Conventional Obligations, 13 L
A. L. REV. 236, 241 (1953)).
163. Id.
164. May v. Harris Mgmt. Corp., 928 So. 2d 140, 145 (La. Ct. App. 1st 2005)
(“All estoppel claims must be examined carefully and strictly.”); see, e.g., Rodden
v. Davis, 293 So. 2d 578, 582 (La. Ct. App. 1974) (“The cases holding that
estoppel is not favored by our courts are legion. One who seeks to avail himself
of the application of the principal must establish his right to do so with unusual
clearness.”). The May court cited in support of this contention Wilkinson v.
Wilkinson, 323 So. 2d 120 (La. 1975), a Louisiana Supreme Court decision from
1975. Wilkinson stemmed from a divorce proceeding. Id. at 122. Before Mr. and
Mrs. Wilkinson were married, they entered into a prenuptial agreement that stated
that there would be no community property. Id. But Mrs. Wilkinson was an
unemancipated minor at the time that she signed the agreement. Id. Thus, the court
held the agreement to be null, and applied the default rule of community property.
Id. Mr. Wilkinson argued that he had relied on the prenuptial agreement. Id. at
126. The Louisiana Supreme Court found that Mr. Wilkinson failed to prove all
elements necessary for the plea of estoppel. Id. at 126–27.
2016] COMMENT 945
of this inquiry is Louisiana Civil Code article 1967 itself because “[i]n
Louisiana, as in other civil law jurisdictions, legislation is superior to any
other source of law.”
165
Thus, because legislation is superior, the
codification of the theory of detrimental reliance in Civil Code article 1967
should be the focus regardless of prior Louisiana jurisprudence on the
matter.
166
When the time to overhaul the Louisiana Civil Code’s section on
Obligations arrived in the 1970s and 1980s, the Louisiana State Law
Institute asked that the doctrine of promissory estoppel be incorporated
into the Civil Code.
167
This request led to the eventual codification of
article 1967, the theory of detrimental reliance, in the year 1984.
168
The
drafters of article 1967 wanted to clarify that detrimental reliance would
be recognized as not only a valid legal theory but also as an additional
ground for the enforcement of obligations under Louisiana law.
169
Comment (d) to the article explains that prior jurisprudence holding
otherwise was overruled: “[u]nder this Article, a promise becomes an
enforceable obligation when it is made in a manner that induces the other
party to rely on it to his detriment. . . . The case of Ducote v. Oden . . .
(holding that promissory estoppel is not recognized in Louisiana) is thus
overruled.”
170
Although the comments to the Code are not the law,
comment (d) serves as strong evidence of the legislature’s full
endorsement of the theory of detrimental reliance, despite the theory’s
rejection by the state’s highest court. A valid and enforceable contract is
clearly not required to recover under the article; all that is needed is a
165. LA. CIV. CODE art. 1 cmt. c (2015).
166. The decisions of judges do not play as important a role in civil law
systems as they do in common law systems. As a result, “the judge’s decision is
consequently less crucial in shaping civil law than the decisions of legislators and
legal scholars who draft and interpret the codes.” Univ. of Cal. at Berkeley Sch.
of Law, The Common Law and Civil Law Traditions, available at
https://www.law.berkeley.edu/library/robbins/pdf/CommonLawCivilLawTraditi
ons.pdf [perma.cc/QQA3-JM5P]; see also Robert Anthony Pascal, Of the Civil
Code and Us, 59. L
A. L. REV. 301, 307 (1998) (“It also may serve as a guide to
what should or should not be considered a proper interpretation or application of
the law in future similar cases; but it may not be considered to project an
authoritative rule for the future.”).
167. Adcock, supra note 141, at 754.
168. For an interesting and in-depth discussion on the codification of article
1967, see Snyder, supra note 144. Louisiana Civil Code article 1967 became
effective on January 1, 1985.
169. L
A. CIV. CODE art. 1967 cmt. a (“This Article . . . . incorporates
detrimental reliance as an additional ground for enforceability.”); see also Kethley
v. Draughon Bus. Coll., Inc., 535 So. 2d 502, 506 (La. Ct. App. 1988) (“LSA–
C.C. Art. 1967 changed Louisiana law by incorporating detrimental reliance as an
additional basis for the enforceability of obligations.”).
170. L
A. CIV. CODE art. 1967 cmt. d.
946 LOUISIANA LAW REVIEW [Vol. 76
promise that induces reliance to one’s detriment. Once this occurs, one can
seek redress under article 1967.
171
C. Unique Civilian Concerns
Outside of Louisiana’s at-will employment doctrine and the state’s
theory of detrimental reliance, other critical distinctions between
Louisiana and common law jurisdictions exist that clarify that allowing
prospective employees a cause of action when an offer of employment is
withdrawn is the proper solution for Louisiana. One of these critical
distinctions is that the civil law uses the theory of cause, instead of the
common law theory of consideration.
172
Another significant distinction is
the existence of codes in civilian systems of law.
173
1. Civil Law Cause as Compared to Common Law Consideration
A major difference between Louisiana’s civil law jurisdiction and
common law jurisdictions is the concept of cause as compared to the
common law doctrine of consideration.
174
Confusion over the differences
between the two doctrines is somewhat understandable because despite
some considerable differences, the two theories play similar roles in their
respective legal systems.
175
As Professor Saul Litvinoff explains, “[a]t
common law, lack of consideration is a good reason to deny enforceability
171. See Suire v. Lafayette City-Parish Consol. Gov’t, 907 So. 2d 37, 59 (La.
2005) (“[P]roof of a detrimental reliance claim does not require proof of an
underlying contract. This is so because detrimental reliance is not based upon the
intent to be bound.”); see also Oelking, supra note 141, at 1389.
172. Litvinoff, supra note 148, at 3; see infra Part II.C.1.
173. See infra Part II.C.2.
174. Despite this, attorneys practicing in Louisiana still have to deal with
consideration. See Herman, supra note 146, at 719 (“For Louisiana lawyers both
cause and consideration are meaningful, but for different reasons. Cause is
important because of the Civil Code and the continental tradition it bespeaks;
consideration is important because Louisiana shares a largely common-law
national tradition, and as a consequence, Louisiana attorneys can hardly escape
daily reference to consideration.”).
175. See Federick H. Sutherland, Comment, Promissory Estoppel and
Louisiana, 31 L
A. L. REV. 84, 88 (1970) (“The requirement of consideration in
the Anglo-American law of contract has often been compared with the
requirement of cause in the civil law.”); see also A
LAIN A. LEVASSEUR,
COMPARATIVE LAW OF CONTRACTS: CASES AND MATERIALS 79 (2008) (“[Under
common law] the existence of ‘some’ consideration is a required element for the
validity of all contracts . . . meant to be binding, whereas at civil law there must
exist a lawful ‘cause’ or lawful reason to make a promise by one party binding on
that party or on both parties depending on the nature of the juridical acts entered
into.”).
2016] COMMENT 947
of a promise. In civilian systems . . . absence of cause, or unlawfulness or
immorality of the cause, is a good reason to deprive an obligation of its
legal effect.”
176
a. Common Law’s Burdensome Requirement of Consideration
The doctrine of consideration is often thought to be the cornerstone of
Anglo-American contract law.
177
Generally speaking, the focus of
American contract law’s consideration analysis is on whether the contract
in question involved a bargain.
178
Something is bargained for “if it is
sought by the promisor in exchange for his promise and is given by the
promisee in exchange for that promise.”
179
The doctrine is rigid, as a
promise not supported by a legal consideration is not binding regardless
of the promisor’s intentions to be bound.
180
b. Civil Law’s Flexible Cause
Louisiana does not adhere to the common law doctrine of
consideration,
181
and the comments to article 1967 clarify that cause and
consideration are two distinct theories.
182
In Louisiana, cause is defined in
the first paragraph of Civil Code article 1967 as “the reason why a party
176. Litvinoff, supra note 148, at 3.
177. Sutherland, supra note 175, at 85.
178. E.
ALLAN FARNSWORTH, CONTRACTS 45 (3rd ed. 1999); see also
RESTATEMENT (SECOND) OF CONTRACTS § 71 (1981) (“(1) To constitute
consideration, a performance or a return promise must be bargained for. (2) A
performance or return promise is bargained for if it is sought by the promisor in
exchange for his promise and is given by the promisee in exchange for that
promise. (3) The performance may consist of[:] (a) an act other than a promise, or
(b) a forbearance, or (c) the creation, modification, or destruction of a legal
relation. (4) The performance or return promise may be given to the promisor or
to some other person. It may be given by the promisee or by some other person.”).
179. F
ARNSWORTH, supra note 178, at 45 (quoting RESTATEMENT (SECOND)
OF
CONTRACTS § 71).
180. P.S. ATIYAH, AN INTRODUCTION TO THE LAW OF CONTRACT 124 (4th ed.
1989) (emphasis in original).
181. Aaron & Turner, L.L.C., v. Perret, 22 So. 3d 910, 915 (La. Ct. App. 2009)
(“Louisiana law does not follow the common law tradition that requires
consideration to effect an enforceable contract.”).
182. The relevant comment to article 1967 states:
Under this Article, “cause” is not “consideration.” The reason why a
party binds himself need not be to obtain something in return or to secure
an advantage for himself. An obligor may bind himself by a gratuitous
contract, that is, he may obligate himself for the benefit of another party
without obtaining any advantage in return.
L
A. CIV. CODE art. 1967 cmt. c (2015).
948 LOUISIANA LAW REVIEW [Vol. 76
obligates himself.”
183
Thus, a bargain is not necessary, and the focus is on
the promisor’s will to be bound.
184
One commentator has gone as far as to
say that in the civil law the most fundamental principle is that a mere
agreement without any additional element serves to constitute a
contract.
185
Under this theory, “[a]ll that is required for a valid contract are
parties capable of contracting, their consent legally given, and a lawful
purpose.”
186
Due to these characteristics, some have said that the addition
of detrimental reliance in Civil Code article 1967 was unnecessary. For
example, one scholar noted that because cause is broader than
consideration, more promises may be enforced without even having to turn
to promissory estoppel.
187
Altogether, these differences between cause and consideration bolster
the notion that even though the prospective employee has not given any
consideration for the receipt of the job offer, this employment agreement
should not be barred from having some legal effects due to the doctrine of
cause in a civil law system like Louisiana.
2. Other Civil Code Provisions Affect the Analysis
When analyzing an article in a civil code, one should recognize that
the articles do not exist in a vacuum, but rather all of the articles relate
together to form one comprehensive system of law.
188
Thus, when
analyzing an issue, one should look to various articles throughout the Civil
Code and not just to articles 1967 and 2747.
The Civil Code has numerous articles that protect an individual when
some sort of harm is done to that person to the advantage or benefit of
another. For example, Civil Code article 2315 states that, “[e]very act
whatever of man that causes damage to another obliges him by whose fault
it happened to repair it.”
189
Similarly, article 2298 says, “[a] person who
183. Id. art. 1967.
184. See Aaron & Turner, L.L.C., 22 So. 3d at 915 (“[T]he mere will of the
parties will bind them . . . .”); J. Denson Smith, A Refresher Course in Cause, 12
L
A. L. REV. 2, 5 (1951) (“An expression by one person of a will to bind himself,
when concurred in by another, constitutes a concurrence of wills, or contract.”).
185. Sutherland, supra note 175, at 88.
186. Id.
187. Id. at 107–08; see also Mattar, supra note 138, at 149 (“In civil law
jurisdictions, the argument has been made that there is no need to resort to a
substitute for cause because, under the concept of cause, a gratuitous promise is
enforceable and promissory estoppel would then serve no useful end.”).
188. See, e.g., Pascal, supra note 166, at 306 (“[Louisiana Civil Code of
1870’s] articles in any Title or Chapter could be read continuously, as a whole, as
they should be, so that the relationship of each article to the others as parts of the
whole could be understood.”).
189. L
A. CIV. CODE art. 2315 (2015).
2016] COMMENT 949
has been enriched without cause at the expense of another person is bound
to compensate that person.”
190
Various articles in the Code, however, do
not hold a person liable when another’s deception or mistake led to the
agreement.
191
Article 1951 provides that, “[a] party may not avail himself
of his error if the other party is willing to perform the contract as intended
by the party in error.”
192
These articles are just some examples that have
led one commentator to the conclusion that “[i]n my judgment, the
principles of mutual respect and cooperation for the common good
underlie the entire Civil Code.”
193
Therefore, when courts look to the
articles that encompass Louisiana’s at-will employment doctrine
194
and its
detrimental reliance theory,
195
they should do so with these underlying
principles of the Civil Code in mind. Further, these courts should
acknowledge that parties in an at-will employment relationship should
treat each other fairly and work in cooperation.
The foundational concepts and doctrines unique to Louisiana’s civil
law system bolster the notion that a prospective employee that has relied
to his or her detriment on an offer of employment should be granted a
cause of action against the rescinding employer. For one, Louisiana
jurisprudence has misapplied Louisiana Civil Code article 2747, and it has
ignored the duty of good faith that underlies all obligations. Louisiana
courts also have failed to recognize the importance of the legislature’s
codification of detrimental reliance in Civil Code article 1967. Finally, the
civilian concept of cause, and the spirit that underlies the Louisiana Civil
Code leads to a conclusion that favors recovery.
III.
THE FAILURE OF LOUISIANA’S CURRENT APPROACH
Louisiana’s current approach to rescinded offers of employment is
undesirable. The legal history of the state, the improper interpretation of
Civil Code articles by Louisiana courts, the unique characteristics of
190. Id. art. 2298.
191. See, e.g., id. art. 1924 (“The mere representation of majority by an
unemancipated minor does not preclude an action for rescission of the contract.
When the other party reasonably relies on the minor’s representation of majority,
the contract may not be rescinded.”); id. art. 3010 (“The principal is not bound to
the mandatary to perform the obligations that the mandatary contracted which
exceed the limits of the mandatary’s authority unless the principal ratifies those
acts.”); id. art. 3021 (“One who causes a third person to believe that another
person is his mandatary is bound to the third person who in good faith contracts
with the putative mandatary.”).
192. Id. art. 1951.
193. Pascal, supra note 166, at 310.
194. L
A. CIV. CODE art. 2747 (2015).
195. Id. art. 1967.
950 LOUISIANA LAW REVIEW [Vol. 76
Louisiana’s civil law system, and public policy considerations all point to
recovery in these circumstances.
A. Detrimental Reliance Should Not Be Disfavored in Louisiana Law
When a court begins its analysis of reliance on an offer of
employment, the court should not begin by saying that detrimental reliance
is disfavored in Louisiana law.
196
This premise comes from a failure to
acknowledge the importance of the codification of Civil Code article 1967
as well as an unawareness of the longstanding tradition of reliance in civil
law systems.
197
In those legal systems, legislation is a greater source of
authority than jurisprudence;
198
thus, starting an analysis by citing any
cases inconsistent with Civil Code articles—particularly cases that
preceded codification of an article that changed the law—is an improper
approach. Therefore, the May court mistakenly asserted that estoppel is
not favored in Louisiana law when it cited to Wilkinson v. Wilkinson,
199
which was decided before the codification of article 1967.
200
B. The At-Will Employment Doctrine Should Not Supersede Article 1967
Article 1967 and later jurisprudence clarify that detrimental reliance
is an independent source of obligations and that the theory has its own
ground for enforceability.
201
Because article 1967 is its own source of
obligations, what gives rise to the claim for damages by the enticed
prospective employee is not the existence of the employment relationship
itself nor the employment contact. Rather, the claim for damages depends
simply on the prospective employee’s reliance on the promise of
employment.
202
Thus, allowing the at-will employment doctrine that
196. See Adcock, supra note 141, at 757–58 (“Our courts also cannot start their
analysis of detrimental reliance with a statement of its unfavored status . . . .”).
197. See supra Part II.B.
198. L
A. CIV. CODE art. 1 cmt. c (“In Louisiana, as in other civil law jurisdictions,
legislation is superior to any other source of law.”).
199. Wilkinson v. Wilkinson, 323 So. 2d 120, 126 (La. 1975).
200. See May v. Harris Mgmt. Corp., 928 So. 2d 140, 145 (La. Ct. App. 1st
2005).
201. L
A. CIV. CODE art. 1967 cmt. a; see also Kethley v. Draughon Bus. Coll.,
Inc., 535 So. 2d 502, 506 (La. Ct. App. 1988) (“[Louisiana Civil Code article]
1967 changed Louisiana law by incorporating detrimental reliance as an
additional basis for the enforceability of obligations.”).
202. See Suire v. Lafayette City-Parish Consol. Gov’t., 907 So. 2d 37, 59 (La.
2005) (“[P]roof of a detrimental reliance claim does not require proof of an
underlying contract. This is so because detrimental reliance in not based upon the
intent to be bound.”).
2016] COMMENT 951
governs the employment relationship to control is illogical when the claim
for damages is not dependent on that employment relationship.
Additionally, the words of article 1967 are clear and unambiguous.
Civil Code article 9 states, “[w]hen a law is clear and unambiguous and its
application does not lead to absurd consequences, the law shall be applied
as written and no further interpretation may be made in search of the intent
of the legislature.”
203
Thus, article 1967 should be applied as written.
Opponents to this approach argue that allowing recovery in this context
would be an absurd consequence,
204
but this argument is flawed. By
adopting article 1967, the legislature endorsed a ground of enforceability
outside of the contract itself, and thus outside of the at-will employment
context. Nothing about allowing these two bases of recovery—one in
contract and one in detrimental reliance—is absurd.
205
To hold otherwise
would be to say that the legislature made an absurd decision when it
codified article 1967. Further, from a purely common sense approach,
allowing someone who has been adversely harmed by the promises of
another to recoup any losses from the promisor is not absurd.
206
Likewise, “[a] ‘plain reading’ of the terms of Article 1967 further
supports the view that Article 1967 requires only a ‘promise’ and
‘reasonable reliance’ in order for an aggrieved promisee to recover and
does not require a valid and enforceable contract.”
207
Certainly, the
employer–employee relationship is one that is contractual in nature, and
the at-will employment doctrine bars the recovery of damages from
termination of this contractual relationship. Therefore, the at-will
employment doctrine would bar any claim stemming from a termination
that occurred during the existence of the contractual employment
relationship. The at-will employment doctrine should not, however, bar
reliance damages that come into existence before the commencement of
employment and before the existence of any contractual relationship
because of the difference between a promise of employment and actually
working at the job. Thus, the application of the at-will doctrine before
203. LA. CIV. CODE art. 9.
204. See, e.g., supra note 44. Although the absurdity argument raised by
common law courts is not within the context of Civil Code article 9, the argument
can be easily analogized to the absurdity contemplated by the article.
205. Oelking, supra note 141, at 1389.
206. This is in the same general spirit as Louisiana Civil Code article 2315,
which states, “[e]very act whatever of man that causes damage to another obliges
him by whose fault it happened to repair it.” L
A. CIV. CODE art. 2315.
207. Oelking, supra note 141, at 1388 (emphasis in original).
952 LOUISIANA LAW REVIEW [Vol. 76
commencement of employment is an unwarranted intrusion of the doctrine
into an area that should not be subject to its rules.
208
Further, the basis for recovery is distinct because with a detrimental
reliance claim, the plaintiff is seeking recovery for a job he or she
relinquished in response to a promise, rather than contractual damages
stemming from the actual withdrawal of the offer of employment.
209
Saying that an employer has a right to terminate an employee for any
reason is one thing; but saying that an employer can induce a person to
give up a job with another employer without liability is quite another.
Thus, distinguishing between breaking a promise to allow one to work and
the termination of an individual after he or she has entered into the
contractual relationship of employment seems entirely reasonable. In the
latter instance, the individual’s understanding of the risks involved is
greater.
210
As Judge Gaidry explained in May, “the line must be drawn
somewhere.”
211
Further, if a prospective employee is never given the
benefits of employment, allowing the employer the full benefits and
protections of the at-will employment doctrine is inequitable. The
counterargument that this will undermine the at-will employment doctrine
cannot be correct because the doctrine’s goal, from the employer’s
perspective, is to permit the easy removal of employees who are not
performing or are compromising the workplace.
212
Thus, this justification
does not apply when the prospective employee has yet to commence work.
C. Civilian Considerations Make a Difference
Courts should also be careful when adopting common law approaches
and applying them in Louisiana. A prospective employee’s reliance on an
employer’s offer of employment is more reasonable in Louisiana when
compared to the state’s common law brethren. One reason is the inherent
208. See May v. Harris Mgmt. Corp., 928 So. 2d 140, 150 (La. Ct. App. 1st
2005) (Gaidry, J., dissenting) (“[A]pplying the at-will employment principle . . .
to a prospective employee . . . is an unwarranted extension of the at-will principle
to a classic factual scenario of detrimental reliance governed by [Louisiana Civil
Code article] 1967.” (emphasis in original)).
209. See supra Part I.A.
210. May, 928 So. 2d at 150–51 (Downing, J., concurring) (“Common sense
and experience demonstrate that people seeking new employment for whatever
reason know that risk is involved in the employment, but not in acceptance of the
employment. . . . [W]hile the ‘at-will’ doctrine precludes damages for actual lost
employment, the ‘at-will’ doctrine does not apply to a party who is not yet an
employee.”).
211. Id. at 150 (Gaidry, J., dissenting).
212. Devlin, supra note 6, at 1514; see also LaBove v. Raftery, 802 So. 2d 566,
582 (La. 2001).
2016] COMMENT 953
difference between the common law theory of consideration and the civil
law theory of cause.
213
The civil law “purports to recognize that a person
may bind himself merely by expressing a will to do so and for that reason
it regards a promise as enforceable merely because it is a promise.”
214
There is no strict requirement of something being given in exchange for
something else.
215
At least generally speaking, a binding obligation can
come into being simply by one expressing a will to be bound. Thus, for
someone in a civil law jurisdiction like Louisiana to act in reliance on a
promise is much more reasonable than it is for someone in a common law
jurisdiction, where a bargained-for exchange must exist.
Regarding at-will employment in Louisiana, one can make a solid
argument that the Civil Code requires the termination of the relationship
to be carried out in good faith.
216
But this is a position that has not had
much success in Louisiana courts.
217
Just because Louisiana courts have
not required good faith in the termination of at-will employment generally,
however, does not mean that they should continue to ignore the duty of
good faith in the distinct context of withdrawal of an offer of employment.
Barring these reliance claims by aggrieved prospective employees simply
by saying that the at-will employment doctrine should control is
nonsensical, particularly when the employer may have been, for whatever
reason, leading the prospective employee on in bad faith. Under the current
approach, a wronged prospective employee would never get a chance to
prove this deception in court. As Judge Downing noted in May, “[w]hen
we say that it is unreasonable as a matter of law for an employee to rely
on a promise of employment, we say that it is reasonable for employees to
expect employers to breach their promises and act in reckless disregard of
the prospective employees’ welfare.”
218
No set definition exists of what
constitutes good faith in every scenario;
219
however, leading an employee
to believe they are gainfully employed just to fire them on the first day
213. See supra Part II.C.1.
214. Sutherland, supra 175, at 88.
215. See L
A. CIV. CODE art. 1967 cmt. c (2015) (“The reason why a party binds
himself need not be to obtain something in return or to secure an advantage for
himself. An obligor may bind himself by a gratuitous contract, that is, he may
obligate himself for the benefit of another party without obtaining any advantage
in return.”).
216. See supra Part II.A.2.
217. But see Allbritton v. Lincoln Health Sys., Inc., 51 So. 3d 91, 96 (La. Ct.
App. 2010) (“Although Louisiana is an at-will employment state, [the employer
has] a duty of good faith.”).
218. May v. Harris Mgmt. Corp., 928 So. 2d 140, 151 (La. Ct. App. 1st 2005)
(Downing, J., concurring).
219. See L
ITVINOFF, supra note 133, at 17 (The words good faith “are used on
the general assumption that everybody understands what they mean.”).
954 LOUISIANA LAW REVIEW [Vol. 76
violates good faith behavior.
220
Thus, because courts have failed to inquire
into the good faith of the employer in any way, employers are given
benefits and protections that they are not entitled to under the Civil Code.
Further, the overall spirit of the Civil Code supports a prospective
employee’s recovery when he or she was misled with an offer of
employment. The Civil Code contains numerous articles that provide
protection to an individual’s interests when another has allegedly damaged
those interests.
221
Some may argue that an employer should not be liable
when they make an honest mistake like having a sudden budget shortfall
or not actually having as much work available as originally thought, but
the Civil Code in another context does not allow a party to avail himself
of his error when the other party is ready to perform.
222
The employee in
most instances will be free from fault and will suffer great loss due to his
or her reliance. The employer will generally be in a much better position,
however, to assess costs, make decisions, and potentially bear the losses.
Therefore, protecting the interests of the prospective employee who is free
from fault reinforces the underlying theme of the Louisiana Civil Code.
D. Public Policy Favors Recovery
Finally, from a policy standpoint, finding reliance on a promise of
employment to be per se unreasonable is incorrect. For example, in Bains,
the CEO of the company told Bains on at least three occasions that she had
been offered the job.
223
Some of the offers were in writing, she was given
a starting salary figure, and she was given a start date.
224
Taking this all
into account, relying on these assurances would be reasonable for someone
in her situation. By not allowing her any sort of recourse, Louisiana courts
are essentially encouraging irresponsible and reckless behavior by
employers that will face no consequences.
225
Also, common sense would indicate that employers do not just fire an
employee who is doing his or her job adequately. Thus, it follows that
220. Also, one would think that an employer would be naturally deterred from
this type of behavior, as bringing someone into the workplace only to fire that
individual on the same day would be disruptive to the work environment and other
employees’ states of mind.
221. See supra Part II.C.2.
222. L
A. CIV. CODE art. 1951 (2015) (“A party may not avail himself of his
error if the other party is willing to perform the contract as intended by the party
in error.”).
223. Bains v. Young Men’s Christian Ass’n of Greater New Orleans, 969 So.
2d 646, 647 (La. Ct. App. 4th 2007).
224. Id.
225. See May v. Harris Mgmt. Corp., 928 So. 2d 140, 151 (La. Ct. App. 1st
2005) (Downing, J., concurring).
2016] COMMENT 955
employees adequately performing their duties will maintain their
employment unless they act in a way that would give their employer a
reason to terminate them. From a purely practical standpoint, allowing an
outside employer to induce a current model employee to join their
organization, and then not coming through with the job, is allowing
someone who otherwise would be employed become unemployed for no
real fault of his or her own. By not offering any consequences for an
employer, one could imagine a situation as extreme as a competing
employer luring a key employee away from their competition only to
renege on the offer and leave their competitor in a compromised position.
The employee would just be collateral damage. An employer in bad faith
could severely damage a potential employee’s professional career and
come away unscathed. Therefore, it is unjust to not allow an individual
any sort of protection when they have to leave current employment to
accept a new job offer.
226
This Comment does not argue for recovery in all instances in which
an employer withdraws an offer of employment. Article 1967 requires that
the reliance be reasonable and that the employer know or should know that
the prospective employee will act to his or her detriment.
227
Surely an
employer telling a prospective employee “we need a guy like you around
here” or something similar would not be a reasonable basis for taking
action. Likewise, an employer would not be liable if an individual saw a
job posting from an employer and then immediately left his or her current
job to pursue that opportunity, as the employer in that situation would not
have known that the individual would have acted in that manner. Often,
though, the employer is aware that the prospective employee must resign
from current employment to accept the prospective job; thus, reliance in
this common circumstance is foreseeable and should be expected by the
employer.
228
Therefore, the individual circumstances that the factfinder considers
would limit the cause of action to only those situations in which recovery
is reasonable. Some considerations could include the extent of the offer,
who made the offer, by what medium the offer was made, the apparent
firmness of the offer, the amount of stability apparent in the business of the
offering employer, and unique factors dealing with the particular industry.
229
226. Id. at 150 (“It seems to me patently absurd that we could find it patently
unreasonable for an employee to rely on an offer of at-will employment when the
employee cannot accept the offer without leaving secure employment and incurring
expenses.”).
227. L
A. CIV. CODE art. 1967.
228. ROTHSTEIN ET AL., supra note 7, at 83.
229. Although these factors are in many ways common sense, Louisiana courts
have utilized similar considerations in other detrimental reliance contexts. See,
956 LOUISIANA LAW REVIEW [Vol. 76
IV. RETURNING TO BOB: THE APPLICATION OF JUSTICE
If Bob’s reliance was no longer unreasonable as a matter of law, Bob
could bring suit under Civil Code article 1967 for his reliance on Kirk’s
promise of employment. He would be required to show by a preponderance
of the evidence three elements: (1) representation by conduct or word by
Kirk; (2) a justifiable reliance on Kirk’s representation; and (3) a change in
position to his detriment because of that reliance.
230
Bob could satisfy the first element because Kirk made a clear
representation to Bob that he had a job available for him. The second
element is where Bob’s burden is the heaviest. A finder of fact could come
to the conclusion that his reliance was reasonable by looking to the facts
surrounding Bob’s situation. First, Kirk was the one who originally
contacted Bob about the employment. Second, Kirk was the CEO of the
company, not a low-level manager. This is an important fact, as a CEO or
other upper-level manager is generally understood by a reasonable person
to carry a certain level of responsibility within the business; thus making his
or her words particularly authoritative and reliable on an issue. Third, Kirk
went as far as discussing starting salaries with Bob. This discussion of
starting salaries would lead a reasonable person to believe that the
employer has analyzed its current financial position, and has made an offer
that is within its current means. Bob displayed concern about losing his
current job, and because of this, he contacted Kirk on multiple occasions
to confirm that he would be given the job. Bob was given a starting date
after Kirk reassured Bob that the position would be his. All of these factors
would seem to indicate that Bob’s reliance on the offer was reasonable.
Finally, the third element of his claim is satisfied as well because Bob had
a change in his position to his detriment because of his reliance on Kirk’s
e.g., Water Craft Mgmt., L.L.C. v. Mercury Marine, 361 F. Supp. 2d 518, 556
(M.D. La. 2004) (“Under Louisiana law, reasonableness is determined by
examining factual circumstances like the commercial sophistication of the party
claiming detrimental reliance and the negotiations and/or documents the party
relied on.”); Academy Mortg. Co. v. Barker, Boudreaux, Lamy & Foley, 673 So.
2d 1209, 1212 (La. Ct. App. 1996) (“[A] promisee’s business acumen is properly
considered when determining reasonableness of the claimed reliance.”); Amitech
U.S.A., Ltd. v. Nottingham Constr. Co., 57 So. 3d 1043, 1052 (La. Ct. App. 2010)
(“Nottingham’s reliance was unreasonable given Hick’s acknowledgement that
Cormier was required to obtain approval from the overseas manager prior to
entering into transactions.”). Also, similar factors are considered by some
jurisdictions when attempting to establish the terms of an employment contract
implied by the conduct and relationship of the parties. See R
OTHSTEIN ET AL.,
supra note 7, at 831.
230. May, 928 So. 2d at 145; see also Murphy Cormier Gen. Contractor, Inc.
v. Dep’t of Health & Hosps., 114 So. 3d 567, 596 (La. Ct. App. 2013); Amitech
U.S.A., Ltd., 57 So. 3d at 1052.
2016] COMMENT 957
promise. Bob was once employed, and his reliance on Kirk’s promise has
left him unemployed with no current job prospects.
After having successfully established his claim under Louisiana Civil
Code article 1967, Bob then would be entitled to reliance damages. Based
on the facts, Bob should receive compensation for lost wages from his
original employment along with any other expenses that Bob incurred as
a direct result of Kirk’s actions. Because Bob’s damages are limited to his
actual and reasonable reliance, Kirk is not being held liable for any more
damage than what he directly caused. Bob also has the duty to mitigate his
damages by seeking other employment opportunities. Thus, this solution
provides much needed relief for Bob but does not cause any undue burden
for Kirk.
C
ONCLUSION
This Comment has shown the deficiencies in Louisiana’s current
approach relating to reliance on an offer of at-will employment. Further,
this Comment has argued that categorically barring detrimental reliance
claims for withdrawn offers of employment is an improper solution.
Rather, a prospective employee who has had his or her offer of
employment revoked after relying on the promise should be able to bring
a claim for damages under article 1967. The reasonableness of a
prospective employee’s reliance should be decided by looking to the
particular facts and circumstances surrounding the offer of employment.
Allowing these claims is necessary to promote fairness and avoid injustice
to a wronged prospective employee. Offering protection only to employers
has led to undesirable and inequitable outcomes in Louisiana.
Taylor Crousillac
*
* J.D./D.C.L., 2016, Paul M. Hebert Law Center, Louisiana State University.
The Author would like to thank Professor Wendell Holmes and Interim Dean Bill
Corbett for their guidance and assistance during the development of this
Comment. Also, none of this would have been possible without the support of the
Author’s amazing family—Keith, Amey, and Anna. Thank you for everything
that you do.
