California
How Cross v. State of Michigan applies in California: state-specific rules, key cases, and bar exam notes for Contracts.
In California, the principles of reliance and unjust enrichment from Cross v. State of Michigan are examined through the lens of promissory estoppel and quasi-contract. California courts emphasize protecting parties against loss when they rely on a promise, particularly when a formal contract may not exist.
California recognizes the doctrine of promissory estoppel, which enforces a promise when the promisee detrimentally relies on it and it is unjust for the promisor to go back on their word.
This case established that a plaintiff can recover under a quasi-contract theory even when an express contract exists if they have relied on the promisor's representations to their detriment.
The court addressed reliance damages in contracts, emphasizing that parties may recover for lost opportunities when reliance can be shown.
In this case, the court ruled that a subcontractor's bid could not be revoked after the general contractor relied on it in making a bid for a public contract.
California's application of the reliance theory aligns with the federal standard of promissory estoppel as articulated in cases like §90 of the Restatement (Second) of Contracts. However, California's broader interpretation allows for recovery based on unjust enrichment even when formal contracts are lacking, which is not universally applied across federal jurisdictions.
Promissory estoppel and unjust enrichment are relevant topics for the California bar exam, particularly as they relate to contract formation and enforceability issues.