Business Law 5th Edition by David Twomey ,Marianne Jennings ,Stephanie Greene

Exercise 13

Hoffman wanted to acquire a franchise for a Red Owl grocery store. (Red Owl was a corporation that maintained a system of chain stores.) An agent of Red Owl informed Hoffman and his wife that if they would sell their bakery in Wautoma, acquire a certain tract of land in Chilton (another Wisconsin city), and put up $6,000, they would be given a franchise. In reliance on the agent's promise, Hoffman sold his business and acquired the land in Chilton, but he was never granted a franchise. He and his wife sued Red Owl. Red Owl raised the defense that there had been only an assurance that Hoffman would receive a franchise, but because there was no promise supported by consideration, there was no binding contract to give him a franchise. Decide. [Hoffman v Red Owl Stores, Inc., 133 NW2d 267 (Wis)]