Feinberg v. Pfeiffer Co.

Facts

Feinberg began working for Pfeiffer, a manufacturer of pharmaceuticals, in 1910, when she was 17. By 1947 she was bookkeeper, office manager and assistant treasurer, and she owned 70 shares of the company's stock. On December 27, 1947, the company's Board of Directors adopted a resolution. It recited her many years of long and faithful service, raised her salary from $350.00 to $400.00 per month, and gave her the privilege of retiring at any time she chose on retirement pay of $200 per month for the remainder of her life. Two directors told her of the resolution that same day. She had no earlier word of any pension plan and was surprised. She had no contract about how long she would work, so she was free to quit and the company was free to discharge her. She kept working until June 30, 1949, and then retired. Her health was good and she could have kept working. She testified that she retired to rest, relying on the pension, and would not have left without it. The company paid her $200 each month. Later, a new president and the company's accountants and attorney questioned the payments. On April 1, 1956, the company sent her a check for $100, which she refused.

Issues

1. Did continued employment after the board's resolution, or past years of service, supply consideration (something given in exchange) that made the company's pension promise a binding contract?
2. Can Feinberg enforce the company's promise of a pension for life under promissory estoppel because she retired in reliance on it?

Holding

Pfeiffer's promise to pay Feinberg $200 per month for life was enforceable under promissory estoppel, because she retired from a lucrative position in reliance on the promise and injustice could be avoided only by enforcing it. Her continued employment did not supply consideration.