South Carolina Lawyers Weekly
The circuit court placed too high a burden on plaintiffs – retired city employees – in requiring them to prove they would have been better off if the defendant-city had fulfilled its promise of free health care during their retirement. Nevertheless, the retirees failed to prove that the city’s promise was unambiguous, that their reliance on the promise was reasonable, or that a failure to find promissory estoppel would essentially result in a fraud.
Based on these additional sustaining grounds, we affirm judgment for the city.
Damages
A successful equitable estoppel claim requires a plaintiff to show a prejudicial change in position. By contrast, promissory estoppel requires an injury in reliance on an unambiguous promise.
The circuit court conflated the two concepts, indicating that the retirees needed to prove with specificity that, but for the promise of free health coverage, they would have found other, better employment.
In this case, the city’s promise arguably induced long-term conduct. For someone relying on an ongoing promise, the ability to establish their reliance in terms of what they specifically forewent may be very difficult.
Plaintiffs worked numerous years for the city, believing they were earning no-cost health insurance for life. There were other reasons plaintiffs stayed in their jobs, including a high-quality pension and general quality of life. However, the promise of free health insurance was one of several benefits that enticed plaintiffs to stay. It is not essential that the specific promise of no-cost insurance be the sole inducement for their continuing employment.
In promissory estoppel cases, either expectation damages or reliance damages may be appropriate, depending on the case. Here, the specific performance of the promise would likely be the most logical and equitable method of discerning damages. Requiring plaintiffs to prove they would have been “better off” was too high a burden to place on them. We reverse the circuit court’s ruling as to damages.
Additional Sustaining Grounds
Nevertheless, plaintiffs failed to prove other elements of promissory estoppel.
The promise in this case was not unambiguous. Plaintiffs testified as to varying levels of coverage they believed they were promised.
Furthermore, plaintiffs’ reliance was not sufficiently reasonable. None of the written materials in evidence indicates that the no-cost benefit was guaranteed for life. Plaintiffs’ retirement letters said the current policy was to allow them to participate in the city’s health program and that the city would cover the cost. The letters did not indicate that the offer was guaranteed for life, nor could plaintiffs have relied on the letter during their employment, as they did not receive it until the conclusion of their service to the city.
Finally, promissory estoppel is only invoked when the failure to find it would essentially result in a fraud. This case does not reveal an intent on the part of the city to defraud plaintiffs. It has not changed the premiums charged to retirees on a whim. Instead, it is a response to the ever-increasing costs of healthcare. Additionally, the city continues to pay approximately 90 to 95 percent of the retirees’ coverage, depending on the coverage selected.
Judgment for the city is affirmed.
Cruz v. City of Columbia (Lawyers Weekly No. 011-050-22, 11 pp.) (Aphrodite Konduros, J.) Appealed from Richland County Circuit Court (Scott Sprouse, J.) Lucy Clark Sanders, Nancy Bloodgood, Susan Dunn and Christopher James Bryant for appellants; Allen Nickles for respondent. S.C. App.
