N&W Construction prepared a bid for the Mississippi Job Corps Center (MJCC) to build a kitchen facility

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N&W Construction prepared a bid for the Mississippi Job Corps Center (MJCC) to build a kitchen facility at a training center. In preparing the bid, N&W received oral bids from several plumbing contractors. Hinson quoted $92,000 as his bid for the plumbing job. The next-lowest plumbing subcontractor bid was $139,000. N&W used Hinson's bid in preparing its general contracting bid for the whole project.
N&W was the low bidder and was awarded the MJCC contract. N&W notified Hinson that he was needed to do the plumbing work when construction began. Hinson refused the job. N&W had to hire the next-lowest bidder and pay an additional $47,000 to get the plumbing work done.
N&W sued Hinson on the basis of promissory estoppel. The trial court granted summary judgment to N&W and awarded $47,000 in damages. Hinson appealed.

1. The appeals court held there was an enforceable promise. Since Hinson did not sign a contract and never received any payment from N&W, should Hinson be responsible? Why did N&W not get an agreement in writing?
2. Since the next bid was 50 percent higher than Hinson's, is it likely that Hinson's bid was poorly done, and that he would have suffered a big loss had he done the work?

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The Legal Environment of Business

ISBN: 978-0538473996

11th Edition

Authors: Roger E Meiners, Al H. Ringleb, Frances L. Edwards

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