Drennan v. Star Paving

Mr. Drennan was a contractor looking for a sub-contractor to help him win a local school's construction project.

Each sub-contractor would submit a bid to fulfill a portion of the contract. Drennan would use those bids to put together his overall bid to the school.

Defendant (Star Paving company; "Star Paving") bid on a job for Plaintiff ("Drennan), which accepted Defendant's bid (it was the cheapest bid for $7,000).

The school hired Drennan to complete the construction.

Star Paving then said that its bid was a mistake and wasn't supposed to be so low. Suddenly, Star Paving said his sub-contract needed $15,000 for fulfillment.

Drennan was forced to seek new bids. Finally, he found a sub-contractor to complete Star Paving's sub-contract for $11,000.

Drennan sued Star Paving for breach of contract.

Star Paving answered that it had made a revokable offer with the right to revoke the $7,000 bid.

Drennan won in the trial court.

Can Plaintiff (Drennan) seek, as damages, the difference between Defendant's (Star Paving) initial winning bid and how much Plaintiff was eventually required to pay?

Does detrimental reliance on an offer make it irrevocable, even without formal acceptance?

Drennan argued that he had relied on Star Paving's $7,000 bid to compute his overall bid to the school.

Yes, Plaintiff (Drennan) is entitled to damages. Defendant's bid is enforceable under promissory estoppel. Defendant had reason to expect Plaintiff to rely on the bid.

The offer of $7,000 became irrevocable, because Drennan relied on Star Paving's offer when he submitted his bid to the school.

You will be bound to a promise if you reasonably expect that the promise will cause the promisee to act in reliance to his detriment, and it actually does cause them to act, if enforcing the promise is necessary to avoid an injustice.