C & K ENGINEERING CONTRACTORS v. Amber Steel Co.
587 P.2d 1136, 151 Cal. Rptr. 323, 23 Cal. 3d 1 (1978)
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Rule of Law:
An action based exclusively on the doctrine of promissory estoppel is equitable in nature, and therefore, there is no constitutional right to a jury trial. This is true even when the plaintiff seeks only money damages, as the 'gist' of the action remains equitable.
Facts:
- Plaintiff, a general contractor, solicited bids from subcontractors for the installation of reinforcing steel in a construction project.
- Defendant, a subcontractor, submitted a written bid of $139,511 for the work.
- Noting defendant's bid was substantially lower than the others, plaintiff's estimator called defendant's estimator to confirm the price.
- Defendant's estimator rechecked the figures and verbally confirmed the bid was correct.
- Relying on defendant's bid, plaintiff submitted its master bid for the project, which was subsequently accepted.
- After plaintiff's master bid was accepted, defendant refused to perform the work for the price it had bid, alleging a mistake in calculation.
- Plaintiff was then forced to hire another subcontractor at a cost of $242,171 to perform the steel work.
- As a result, plaintiff incurred costs $102,660 greater than defendant's original bid.
Procedural Posture:
- Plaintiff, a general contractor, sued defendant, a subcontractor, in trial court, seeking damages for breach of contract under a theory of promissory estoppel.
- In its answer, defendant demanded a jury trial.
- The trial court denied defendant's request for a jury trial, ruling that the gist of the action was equitable.
- The trial court did empanel an advisory jury on the limited issue of reasonable reliance, and the advisory jury found for the plaintiff.
- The trial court adopted the advisory jury's finding and entered a judgment in favor of plaintiff for $102,620, plus interest and costs.
- Defendant appealed the judgment, primarily arguing that it was improperly denied its constitutional right to a jury trial.
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Issue:
Does a defendant in a breach of contract action, where the claim is based solely on the equitable doctrine of promissory estoppel, have a constitutional right to a jury trial?
Opinions:
Majority - Richardson, J.
No, a defendant in an action based solely on promissory estoppel does not have a constitutional right to a jury trial. The right to a jury trial is the right as it existed at common law in 1850, which applies to actions at law but not in equity. To determine whether an action is legal or equitable, courts look to the 'gist of the action,' not merely the form of relief requested. Promissory estoppel is an inherently equitable doctrine, developed by courts of equity to enforce gratuitous promises in order to prevent injustice. Since the plaintiff's complaint relies exclusively on this equitable doctrine, the gist of the action is equitable. The fact that the plaintiff seeks money damages does not convert the equitable action into a legal one, because the remedy of damages is only available through the application of the equitable principle of promissory estoppel. Therefore, the trial court properly denied the request for a jury trial.
Dissenting - Newman, J.
Yes, the defendant should have been granted a jury trial. The determination of the right to a jury should focus on the remedy sought, not the historical origin of the legal right being enforced. A simple rule should apply: if a plaintiff seeks legal damages, the parties are entitled to a jury, whereas if a plaintiff seeks equitable relief like an injunction or specific performance, there is no right to a jury. The majority's approach of analyzing the 'gist of the action' through complex historical research is uninstructive and fictional. In this case, the plaintiff sought money damages, a classic legal remedy, and therefore the defendant was entitled to a trial by jury.
Analysis:
This case solidifies the classification of promissory estoppel as a purely equitable doctrine in California for the purpose of the right to a jury trial. The decision clarifies that the 'gist of the action' test requires courts to look beyond the remedy sought (e.g., money damages) and examine the substantive legal theory of the claim. This precedent establishes that any case relying solely on promissory estoppel will be tried by a judge, not a jury. This impacts litigation strategy, as parties in such disputes must frame their arguments for a legal professional rather than a panel of lay jurors, potentially affecting outcomes in cases involving reliance on promises that do not form a traditional contract.
