ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Thursday, December 1, 2016

Weekly Top Ten SSRN Contracts Downloads (December 1, 2016)

Our SSRN Top Ten Downloads lists now return after a Thanksgiving hiatus last Thursday.

Top-10-3D

SSRN Top Downloads For SSRN Logo2
Contracts & Commercial Law eJournal

Rank Downloads Paper Title
1 506 The Reform of the French Law of Obligations: Les Jeux Sont Faits
Jan M. Smits and Caroline Calomme
Maastricht University Faculty of Law - Maastricht European Private Law Institute (M-EPLI) and Maastricht European Private Law Institute (M-EPLI)
2 368 The Law of Smart Contracts
Max Raskin
New York University (NYU), School of Law
3 308 The Role of the State in Contract Law: The Common-Civil Law Divide
Mariana Pargendler
Fundação Getulio Vargas Law School at São Paulo
4 278 Inside Safe Assets
Anna Gelpern and Erik F. Gerding
Georgetown University Law Center and University of Colorado Law School
5 236 Online RPM and MFN Under Antitrust Law and Economics
Pinar Akman and D. Daniel Sokol
University of Leeds and University of Florida - Levin College of Law
6 222 Why Have M&A Contracts Grown? Evidence from Twenty Years of Deals
John C. Coates, IV
Harvard Law School
7 128 The Promise and Problems of Universal, General Theories of Contract Law
Brian Bix
University of Minnesota Law School
8 127 Crowdfunding Investment Contracts
Jack Wroldsen
Oklahoma State University Spears School of Business
9 108 The Illiberty of Contract
Donald J. Smythe
California Western School of Law
10 189 'All the World's a Stage': The Seven Ages of Unjust Enrichment
Graham Virgo
University of Cambridge - Faculty of Law

 

SSRN Top Downloads For SSRN Logo2
Law & Society: Private Law - Contracts eJournal

Rank Downloads Paper Title
1 506 The Reform of the French Law of Obligations: Les Jeux Sont Faits
Jan M. Smits and Caroline Calomme
Maastricht University Faculty of Law - Maastricht European Private Law Institute (M-EPLI) and Maastricht European Private Law Institute (M-EPLI)
2 368 The Law of Smart Contracts
Max Raskin
New York University (NYU), School of Law
3 308 The Role of the State in Contract Law: The Common-Civil Law Divide
Mariana Pargendler
Fundação Getulio Vargas Law School at São Paulo
4 222 Why Have M&A Contracts Grown? Evidence from Twenty Years of Deals
John C. Coates, IV
Harvard Law School
5 189 'All the World's a Stage': The Seven Ages of Unjust Enrichment
Graham Virgo
University of Cambridge - Faculty of Law
6 128 The Promise and Problems of Universal, General Theories of Contract Law
Brian Bix
University of Minnesota Law School
7 127 Crowdfunding Investment Contracts
Jack Wroldsen
Oklahoma State University Spears School of Business
8 108 The Illiberty of Contract
Donald J. Smythe
California Western School of Law
9 91 Long-Term Business Relationships and Implicit Contracts in European Private Law
Ugljesa Grusic
Faculty of Laws, University College London
10 86 First or Second Best? Judicial Law-Making in European Private Law
Chantal Mak
University of Amsterdam - Centre for the Study of European Contract Law (CSECL)

December 1, 2016 in Recent Scholarship | Permalink | Comments (0)

Outlandish Contract Decision re. ADA-related Construction

How is this for a most bizarre contract law decision: The Chicago Housing Authority (“CHA”) contracted with architectural and engineering company DeStefano and Partners (“DeStefano”) for consulting services in connection with the construction of seven multifamily residential buildings. CHA required a certain percentage of the homes to comply with Section 504 of the Rehabilitation Act of 1973 and other federal law (some of the housing was to be accessible by mobility impaired individuals, some by elderly residents). Among other things, DeStefano was made contractually aware that the company was to “certify that all work was performed under the direct supervision of the Project Architect and that it conforms to… the American with Disabilities Act of 1990 … [and] Section 504 of the Rehabilitation Act of 1973.”

During the construction, CHA was notified by HUD that the project did not meet the various federal requirements. CHA hired another architecture firm to perform the work necessary to comply with its obligations under the voluntary compliance agreement with HUD. CHA incurred more than $4.3 million to bring the buildings into compliance with federal standards and brought suit against DeStefano for material breach of contract.

DeStefano defended itself by, at bottom, arguing that since CHA had a nondelegable duty to comply with the federal accessibility standards, it should not be able to recover damages from DeStefano for CHA’s failure to do so. In other words: “It’s your own fault that you have this problem, not ours, even though we were the designers and the problem was with the design.” Yah.

But wait, it gets better than that: the court agreed! It apparently bought wholesale defendant’s argument that “permitting CHA to proceed with its state-law breach of contract action would discourage CHA from fulfilling its own obligations to prevent discrimination under Section 504 and the ADA, directly undermining the goal and purpose expressed by Congress in enacting those statutes.” It also stated that “notably, however, … there are no provisions within the ADA, or its accompanying regulations, that permit indemnification or the allocation of liability between the various entities subject to the ADA.” The court found that CHA’s duties were, as mentioned, nondelegable and, because the duties were imposed on CHA by HUD, CHA’s failure to comply was the problem. “CHA was a ‘wrongdoer’ in the sense that it failed to ensure the subject premises complied with the applicable federal accessibility standards in order to prevent discrimination.”

Wait a minute! So, in trying to make sure that the housing in fact complied with the law, the housing authority was found to have violated it! That’s just crazy.

This case may work as a good example if you want to train your students how to identify faulty reasoning and logic by courts.

The case is can be found here. Hat tip to Justen Hansen of WesTech Engineering for bringing this to my attention. http://www.westech-inc.com/en-usa

December 1, 2016 in Commentary, Government Contracting, Labor Contracts, Legislation | Permalink | Comments (0)

Wednesday, November 30, 2016

A Settlement Agreement That's Too Vague Doesn't Settle Much At All

I am always saying to my students that if they care about something, they should put it in their contract, and they should be specific about what it is they want. I think sometimes people might think there's something to gain strategically by being vague, but introducing ambiguity into a contract can work out very poorly (and also takes control out of the hands of the parties). A recent case out of Florida, Boardwalk at Daytona Development, LLC v. Paspalakis, Case No. 5D15-1944, is a case where the court, faced with an ambiguous description of the land at issue in a contract, just threw up its hands in frustration. 

The dispute between these two parties has been long and contentious. According to this article, it's dragged on for over a decade. It was originally rooted in an eminent domain proceeding in which Boardwalk at Daytona ("BDD")'s predecessor obtained property belonging to Paspalakis and the other appellees. The appellees contested BDD's acquisition of their land and eventually that lawsuit was settled. The settlement agreement provided the appellees with an option to purchase and operate 7500 square feet of retail space on the Daytona Boardwalk. The agreement contained no legal description or street address for the property at issue. The agreement said that the land would: (1) be adjacent to another particular business; (2) have a minimum of 50 boardwalk frontage feet; and (3) have sufficient land to build a 7500-square-foot, one-story building. Unfortunately for the appellees, there were at least three parcels of land that met this description, and they ranged drastically in size from around 7700 square feet to over 17,000 square feet. 

The problem with the description of the land in the settlement agreement was exposed when the appellees tried to operate their option. BDD offered a piece of property that met all three criteria set forth in the settlement agreement. However, the property required unusual structural design features that troubled the appellees and also came with a negative easement for light, air, and unobstructed view that benefitted the BDD property next door. The appellees therefore objected to this plot of land and asked for another one. 

BDD sought a declaratory judgment that the plot of land it proposed was sufficient under the settlement agreement and that it did not have to provide another plot of land. The appellees, in response, sought specific performance that BDD provide  a plot of land fitting the description in the settlement agreement, without the restrictions of the land BDD had offered. In the face of the counterclaim, BDD shifted stance and argued that the settlement agreement was too ambiguous to be enforced. 

The trial court sided with the appellees and ordered BDD to convey the largest possible plot of land to the appellees. BDD appealed, and this court agreed with BDD. The court noted that a description of the land in question is usually considered an essential part of any land purchase agreement, and that without any such description there are serious doubts whether the parties reached a meeting of the minds. The description of the land in the settlement agreement here was ambiguous. The trial court correctly examined parol evidence to try to resolve the ambiguity, but it didn't help. The contract terms at issue here simply could have been fulfilled by any of three very different parcels of land.  To this court, there was no contractual way to choose between them and no parol evidence that shed light on which parcel of land the parties had in mind. Indeed, the court was skeptical the parties ever really agreed on which parcel of land would be conveyed, and so the parties never reached a meeting of the minds that could be enforced. Therefore, the court reversed the order of specific performance and entered judgment for BDD instead. 

A bitter pill here for the appellees, who doubtless thought that they were getting something of value in the settlement agreement they struck and end up with nothing to show for it. But it does seem like there was considerable confusion about which land was affected by the situation here. I guess it's a lesson to all of us: try to be as specific as possible. I tell my students drafting contracts is frequently like playing a game of what-if with yourself. What if BDD offers this parcel of land instead of that parcel of land? If the answer to that question is that you would prefer one parcel of land over the other, best to be specific in the contract. 

November 30, 2016 in Commentary, Current Affairs, In the News, Law Schools, Recent Cases, Teaching, True Contracts | Permalink | Comments (2)

Trump: Contractual Landlord and Lessee at the Same Time

The lease for the Trump International Hotel, housed in Washington’s historic Old Post Office Pavilion owned by the federal General Services Administration (“GSA”), contains a clause forbidding elected officials from involvement. Trump, as president, essentially would be both landlord and tenant.

That may be an ethical problem as well as a federal contract law violation. Trump would oversee the GSA and appoint its administrator ― a conflict of interest with his hotel interest. GSA officials are looking into the matter.

Steven Schooner and Daniel Gordon, former government officials who specialize in federal contract law, have recommended that GSA “immediately end the hotel lease relationship, before Trump becomes president” to avoid ethics problems. Of course, if GSA terminates the lease contract, it risks litigation potentially with… Trump as a winner.

However, says Schooner, that’s a risk worth running. “In the end, it’s just a frigging lease.” It would also be a president heavily involved in private business affairs over which he would exercise significant power, real and perceived. But that may just be how our country is developing these days. We frown on similar behaviors in relation to other countries, but when it comes to our own, we are apparently either becoming accepting of unacceptable behaviors or powerless to do much about them.

November 30, 2016 in Celebrity Contracts, Commentary, Contract Profs, Government Contracting, In the News | Permalink | Comments (0)

Monday, November 28, 2016

Rights of First Refusal to License Mineral Rights and Unconscionability

If you are looking for a case with a nice analysis of procedural and substantive unconscionability, a recent case out of Ohio, Christ Holdings, LLC v. Schleappi, Case No. 15 NO 0427, has one. 

The case involved a right of first refusal that the defendants claimed was unconscionable. The trial court agreed with the defendants, but this court reversed the finding. The court started by looking at procedural unconscionability and noting that it requires consideration of "age, education, intelligence,  business acumen and experience," etc. The court then presented in some amount of detail the education and employment history of both parties, concluding that their educational level is roughly equivalent but that the plaintiff did have more business acumen and experience than the defendant. 

However, importantly for this decision, the court noted that the parties actually had a history of conducting real estate transactions between them without the aid of any attorneys, negotiating several times over the course of several years. To the court, this was an indication that both parties were knowledgeable in the particular type of real estate transaction at issue here, even if the plaintiff had more general business acumen. 

The trial court had also been very concerned about the fact that the defendant had been operating under time constraints. But this court noted that the time constraints were not the plaintiff's fault: he gave no indication that he wouldn't have given her time to read the contract over if she had requested it (which she did not). 

After finding no procedural unconscionability, the court then turned to substantive unconscionability. The trial court had found substantive unconscionability for a number of reasons, most notably, though, because this right of first refusal involved the licensing of mineral rights. The trial court asserted that rights of first refusal should be limited to real estate purchases, not to the leasing or licensing of real estate as was at issue here. The trial court seemed to think that rights of first refusal to license were unconscionable in and of themselves, without further inquiry into their terms. This court, however, said that there was no reason to so narrowly restrict the ability of the parties' to use rights of first refusal in their agreements. It found the right of first refusal to be enforceable and remanded for further proceedings. 

 

November 28, 2016 in Recent Cases, Teaching, True Contracts | Permalink | Comments (0)

Thursday, November 24, 2016

A Sad and Regrettable Loss to Contract Law Academia

As our friends on the Faculty Lounge just announced, Dean Schwartz was just forced to step down as Dean of the University of Arkansas, Little Rock, School of Law. Why? After the recent presidential election, he sent an email to students offering counseling to those upset by the results. Similar initiatives were undertaken around the nation in places so politically and geographically different as the University of South Dakota and Occidental College in Los Angeles.

Apparently, what really cost Dean Schwartz his position was his personal opinion given in the email, namely that the services would be offered to students who “feel upset” following the “most upsetting, most painful, most disturbing election season of my lifetime.”

A colleague of Schwartz's, Robert Steinbuch, who previously tussled with Schwartz over diversity in admissions, explained [cite to FL]: “If you tell people every time they lose they’re entitled to counseling, you elevate the perceived level of wrong beyond what it is. Most assuredly, Democrats are disappointed a Republican won. I recall when the Democratic Party won the Presidency twice each of the previous two elections. I knew plenty of people who were disappointed at that time, but I didn’t know anybody that needed grief counseling. I think when we tell people that they need some form of grief counseling we are normalizing hysteria and suggesting there’s something immoral or wrong about our democratic process.”

How incredibly misunderstood and off point. First, there really is something wrong about our democratic process when repeatedly, the person winning most of the popular votes in an election does not become the president. Similarly, our two-party only, “winner takes it all” system is arguably not a sufficiently faceted system that can be considered to be a true representative, deliberative democracy. But I get that, the system should then be changed before the next election. That won’t happen, just like time after time, mass shooting episodes don’t cause a change to our gun laws or the mass murder situation in general. Such is our country, and so be it, apparently.

What is incredible to me in relation to the above is not Schwartz’ alleged normalization of “hysteria” (read: justified outrage), it is attempts to make this particular election appear normal. It simply was not. Everyone seems to agree on that, Democrats and Republicans alike. In fact, note that many Republicans were outraged as well – and for good reason. Should it be acceptable that we now have a President who, for example, is proud that he “grabs women by the pussy” and “just start[s] kissing them” whether or not they want it? Someone who claims that he is “smart” for not paying taxes for, apparently, many years to a country that he wants to lead, even though he could easily afford doing so? A person who, in spite of sound science proving otherwise until at least yesterday claimed that climate change is a “hoax made up by the Chinese”?

I would hope not. But as we see, apparently that is what we just have to put up with and not even opine about, even in legal academia, in the form of a sentence as innocuous as one that refers to simple, but honest, feelings shared by millions of other people as well.

Throughout history, censorship has never proved particularly effective. As a nation, if we seek to revert to such strategies, we are truly in trouble. Schwartz’ comments may well have upset Republican law students, but maybe that in and of itself would have had some value, especially in an academic setting where thoughts are valued for being just that; thoughts that just might help improve our nation.

On an up note: Happy Thanksgiving, and thanks to Michael Schwartz for being a such a courageous, thoughtful dean and legal scholar!

Greetings from Berlin.

November 24, 2016.

November 24, 2016 in Commentary, Contract Profs, Current Affairs, In the News, Labor Contracts, Law Schools | Permalink | Comments (2)

Wednesday, November 23, 2016

Here's a Nice Anticipatory Repudiation Case for the Next Time You Teach That

A recent case out of West Virginia, Stiles Family Limited Partnership v. Riggs and Stiles, Inc., No. 16-0220, does a nice job analyzing the fact that an anticipatory breach must be unequivocal. The fairly straightforward facts could be a useful way of helping to illustrate this topic the next time you teach it. 

The parties (all members of the same family) entered into a lease under which Riggs and Stiles agreed to farm the property at issue. The lease has been in effect since 2006 without dispute until 2013, when Riggs and Stiles allowed a production company to file an application for a permit to hold a music festival on the farm property. When Stiles Family Limited Partnership learned of the application, they objected; the following month, when they failed to convince the Partnership to allow them to hold the music festival, Riggs and Stiles withdrew the application, and no music festival was ever held on the property. However, the Partnership tried to terminate the lease, arguing that Riggs and Stiles had anticipatorily repudiated the lease when it permitted the filing of the application.  The Partnership claimed that this permission by Riggs and Stiles demonstrated an unequivocal intent on their part to use the land for something other than farming, in violation of the terms of the lease, and it made sense to treat the lease as breached as the moment of application rather than having to wait for the music festival to actually take place.  

The court disagreed, however. It was undisputed that Riggs and Stiles had at all times farmed on the land, never stopping and continuing to farm on the land even after the filing of the application. The application alone was not a breach of the promise to use the land only for farming, as it was undisputed that it was all Riggs and Stiles ever did. And continuing to farm the land was not consistent with an unequivocal repudiation of the lease, because it was actually what Riggs and Stiles was required to do under the lease. Performing consistent with the lease couldn't be considered an unequivocal repudiation of the lease. Moreover, when the Partnership informed Riggs and Stiles that it didn't agree to the music festival being held on the land, Riggs and Stiles withdrew the application for the permit. Rather than being an unequivocal intent to breach the contract, that displayed equivocation on the part of Riggs and Stiles: they sought to take actions to not breach the contract.  

November 23, 2016 in Commentary, Recent Cases, Teaching, True Contracts | Permalink | Comments (0)

Monday, November 21, 2016

Top Gear, Grand Tour, Non-Competes--What Could Possibly Go Wrong?

My love for the British car show "Top Gear" over the past few years was deep and abiding, despite the fact that I am not interested in cars at all. Like most of the people I know, I watched Top Gear for the hosts, Jeremy Clarkson, Richard Hammond, and James May--a trio of men whose friendly and hilarious chemistry was, I thought, a little like capturing lightning in a bottle; it comes around so infrequently that it's striking when it does. 

For a taste of what this version of Top Gear was like, please enjoy my personal favorite, one of the caravan episodes: 

 

Or maybe you would prefer one of the boat-car episodes: 

 

The Top Gear Wikipedia entry details that the show's popularity resulted in consistently high ratings, a waiting list for tickets to the stage-filmed portion of the show that numbered in the hundreds of thousands, and a Guinness World Record for the world's most widely watched factual television show

There have been a number of high-profile Top Gear events over the years that I could document here, from Richard Hammond's terrifying crash while filming the show to the fascinating contractual dispute over the Stig, the show's famously anonymous racing driver, revealing his true identity

But what I'm really focusing on in this entry is the fact that the Top Gear hosts have a new show, "The Grand Tour," that looks a whole lot like their old show, and it made me wonder what their contracts looked like. 

The hosts left Top Gear over controversially. The BBC declined to renew Jeremy Clarkson's contract in March 2015, following an attack by Clarkson on one of the producers on the show (later the subject of a lawsuit that Clarkson settled for a hundred thousand pounds and a formal apology). The other two presenters, Hammond and May, also had contracts up for renewal and chose not to re-sign with the BBC, instead following Clarkson to Amazon, where the trio have launched a show called The Grand Tour

I didn't know what to expect from The Grand Tour but it turns out to be Top Gear by a different name. Where Top Gear had a Stig, The Grand Tour has "the American" -- and they tell us who he is right off the bat, rather than get embroiled in that kind of controversy again. Top Gear had a segment called, simply, "The News"; The Grand Tour launched a similar segment called "Conversation Street." Top Gear had a segment called "Star in a Reasonably Priced Car"; The Grand Tour...well, you should watch the show for its take on that segment. This review does a nice job running down all the similarities between the old show and the new. 

This all fascinated me from a contract perspective. I knew that Clarkson had previously co-owned the commercial rights to Top Gear. He sold them to the BBC in 2012 for fourteen million pounds. So, having given up those rights and left the BBC, Clarkson clearly couldn't keep making "Top Gear." But he is making a motoring show that is almost identical in every cheeky winking respect to the one he left behind (right down to a simple title highlighting a prominent "T" and "G"). 

I do think, from an IP point of view, the new show seems safe: they've been careful to avoid any trademarks and only seem to resemble Top Gear in the uncopyrightable idea level, i.e., being a playful show about cars. But I assumed that Clarkson, Hammond, and May had to have had a non-compete with the BBC, so I went looking for it, and I did find evidence that there was one. It apparently prohibited the three from presenting a competing car program for a period of two years. The two years aren't up yet, leaving lawyers to speculate that a conclusion was drawn that the non-compete only applied to terrestrial broadcast stations and not to Amazon's streaming Internet television. The entertainment industry is changing so quickly, it doesn't surprise me that the contracts are having trouble keeping up. 

Surely the BBC would have preferred to keep Clarkson, Hammond, and May from kicking a rival car show into production so quickly, especially while the BBC's relaunched Top Gear has reportedly struggled. But apparently their contracts failed to give them sufficient protection to save them from the result. 

I will leave for another day the issues of contracts made during the filming of Top Gear itself; like, for instance, the time Clarkson offered to save Hammond from a sinking boat in exchange for a bucket...that turned out to have holes. 

And instead I will leave this entry with an acknowledgment that Jeremy Clarkson is a problematic and controversial figure who is not a stranger to making offensive statement. That's beyond the scope of this article about the BBC's contracts, but this review, I think, does a decent job of capturing the internal tension of a former Top Gear fan contemplating the new Grand Tour.  

November 21, 2016 in Celebrity Contracts, Commentary, Current Affairs, Film Clips, In the News, Television, True Contracts, Web/Tech | Permalink | Comments (0)

Friday, November 18, 2016

Scholarship Spotlight: "The Promise and Problems of Universal, General Theories of Contract Law" (Brian Bix - Minnesota)

Do theories of contract law actually explain what they purport to explain? Legal philosopher and contracts scholar Brian Bix (University of Minnesota) suggests in a concise but content-packed piece entitled The Promise and Problems of Universal, General Theories of Law that the answer to that question is usually no.

 Here is Professor Bix's abstract:

Brian Bix (Minnesota)There is a growing literature offering (competing) theories of particular doctrinal areas – theories of contract law, tort law, property law, criminal law, restitution law, etc. As theories of doctrinal areas – and, not limited in title or description to the doctrinal area of a particular jurisdiction or time period – they purport to describe, explain, or (and) justify all past, present, and possible versions of that doctrinal area. The audacious ambition of such claims has done little to slow the supply of these theories, though it may explain why so few among these projects pause to consider explicitly their methodology and grounds. In this paper, I explore what may justify these sorts of theories, and what problems they need to overcome. I use examples primarily from contract law, as it is the area I know best, but I suspect that the promise and problems of general theories of other areas of law will be similar. Part I examines what is meant by general and universal theories. Part II considers the practice of rational reconstruction, a practice that is both often at the core of what theorists of doctrinal areas do, and central to how they justify their project. Part III reflects more generally on the factors that might cause caution about the project of general theory. Part IV comes from the other direction, looking at the considerations that motivate or ground general theories. And Part V adds a few comments on prescriptive theories.

Contract theories thus provide useful paradigms for explaining and understanding doctrine, but they might do better to disclaim their implicit claim to universality. Bix concludes, in part, with the observation that "[t]he mere fact that theories of doctrinal areas that are implicitly or explicitly universal and general are taken seriously, and not dismissed immediately as nonsense, indicates that they have some grounding in the rules and practices of legal systems."

Professor Bix's article, The Promise and Problem of Universal, General Theories of Contract Law is available for SSRN download here.

November 18, 2016 in Recent Scholarship | Permalink | Comments (0)

Thursday, November 17, 2016

Weekly Top Ten SSRN Contracts Downloads (November 17, 2016)

 

  Top-10-handwritten



SSRN Top Downloads For SSRN Logo2
Contracts & Commercial Law eJournal

1 488 The Reform of the French Law of Obligations: Les Jeux Sont Faits
Jan M. Smits and Caroline Calomme
Maastricht University Faculty of Law - Maastricht European Private Law Institute (M-EPLI) and Maastricht European Private Law Institute (M-EPLI)
2 326 The Law of Smart Contracts
Max Raskin
New York University (NYU), School of Law
3 293 The Role of the State in Contract Law: The Common-Civil Law Divide
Mariana Pargendler
Fundação Getulio Vargas Law School at São Paulo
4 269 Inside Safe Assets
Anna Gelpern and Erik F. Gerding
Georgetown University Law Center and University of Colorado Law School
5 223 Online RPM and MFN Under Antitrust Law and Economics
Pinar Akman and D. Daniel Sokol
University of Leeds and University of Florida - Levin College of Law
6 174 Is Privacy Policy Language Irrelevant to Consumers?
Lior Strahilevitz and Matthew B. Kugler
University of Chicago Law School and Northwestern University - Pritzker School of Law
7 171 Optimal Fee-Shifting Bylaws
Albert H. Choi
University of Virginia School of Law
8 171 'All the World's a Stage': The Seven Ages of Unjust Enrichment
Graham Virgo
University of Cambridge - Faculty of Law
9 166 Tort Reform through the Backdoor: A Critique of Law & Apologies
Yonathan A. Arbel and Yotam Kaplan
Harvard Law School and Hebrew University of Jerusalem
10 119 Crowdfunding Investment Contracts
Jack Wroldsen
Oklahoma State University Spears School of Business

 

SSRN Top Downloads For SSRN Logo2
Law & Society: Private Law - Contracts eJournal

Rank Downloads Paper Title
1 488 The Reform of the French Law of Obligations: Les Jeux Sont Faits
Jan M. Smits and Caroline Calomme
Maastricht University Faculty of Law - Maastricht European Private Law Institute (M-EPLI) and Maastricht European Private Law Institute (M-EPLI)
2 326 The Law of Smart Contracts
Max Raskin
New York University (NYU), School of Law
3 293 The Role of the State in Contract Law: The Common-Civil Law Divide
Mariana Pargendler
Fundação Getulio Vargas Law School at São Paulo
4 171 Optimal Fee-Shifting Bylaws
Albert H. Choi
University of Virginia School of Law
5 171 'All the World's a Stage': The Seven Ages of Unjust Enrichment
Graham Virgo
University of Cambridge - Faculty of Law
6 141 Signing Without Reading
Gerrit De Geest
Washington University in Saint Louis - School of Law
7 119 Crowdfunding Investment Contracts
Jack Wroldsen
Oklahoma State University Spears School of Business
8 106 The Illiberty of Contract
Donald J. Smythe
California Western School of Law
9 92 Financial Contracting in Crowdinvesting: Lessons from the German Market
Lars Klöhn, Lars Hornuf and Tobias Schilling
Humboldt University of Berlin - Faculty of Law, University of Trier and Humboldt University of Berlin - Faculty of Law
10 84 First or Second Best? Judicial Law-Making in European Private Law
Chantal Mak
University of Amsterdam - Centre for the Study of European Contract Law (CSECL)

 

November 17, 2016 in Recent Scholarship | Permalink | Comments (0)

Contracts, Product Liability and Driverless Cars

When it comes to networked and code-controlled products, such as driverless cars and household appliances (the Internet of Things), as I've written elsewhere, contract law can go in two different directions, depending upon how responsive it is to the needs of society.  In this essay, Professors Michael Rustad and Thomas Koenig address the problem of contractual limitations of liability when it comes to driverless cars and other software controlled and networked products.  They place the current era of networked products into historical context and argue that companies "should not be permitted to use contract law to shift the cost of defective code to the end user or consumer." Their essay is an important reminder that contracts - especially mass consumer adhesive form contracts - are not the solution when it comes to consumer products.

November 17, 2016 in Commentary, Web/Tech | Permalink | Comments (0)

Wednesday, November 16, 2016

Remember: Things That Are "Routine" to Lawyers Can Be Confusing to Pro Se Plaintiffs

A recent case out of the Eastern District of Michigan, Bucciarelli v. Wells Fargo Home Mortgage, No. 15-13900, is an illustration of the confusion that can sometimes occur when two parties talk past each other and never really understand each other. The result is that there is no enforceable contract between these parties who never seem to be on the same page.

This is a mortgage foreclosure case in which settlement was attempted but complicated by the fact that there was a lawyer on one side and a pro se plaintiff on the other and they never seemed to be speaking the same language. The defendant's counsel tried to settle the case by by proposing a "routine" settlement to the plaintiff of $500. The plaintiff responded to the proposal by calling the defendant's counsel leaving the following message:

I don't know where it stands but I got it couple days ago regarding the settlement offer of $500 from Countrywide. We can go ahead and do that. So if you wanna give me a call back. My number is []. I do have a lot of mistakes in the Countrywide financial [unclear]. Of those funds that were applied and misapplied to my account but my main focus is Wells Fargo who purchased the loans from Countrywide after Countrywide made some substantial mistakes. Give me a call back. Mary. Thanks bye.

The defendant focused on the "We can go ahead and do that," but the court pointed out that the plaintiff went on after that statement to make allegations regarding Countrywide's mistaken behavior toward her. The court characterized this voicemail as "ambiguous as to her acceptance of all the proposed terms" of the settlement agreement, especially considering that, once the plaintiff received an actual draft of the entire settlement agreement, she refused to execute it. When the defendant moved to enforce the settlement agreement on the basis of the voice message (and subsequent other telephone calls whose contents seem to be disputed), the plaintiff countered that there was no agreement to settle the case. 

In this situation, the court said that it did not feel that the parties had ever agreed on all of the material terms of the settlement. There was no mutual understanding between the parties. The court concluded that each party "heard only what it wanted to hear," and pushed back on defendant's characterization of the settlement offer as "routine": "[I]t must be remembered that Ms. Bucciarelli is appearing pro se, and therefore it is likely that nothing in this litigation is 'routine' to her." 

November 16, 2016 in Recent Cases, True Contracts | Permalink | Comments (2)

Monday, November 14, 2016

If You're Going to Plead Promissory Estoppel, Be Specific!

I just wrote up a promissory estoppel case last week, and here's another one out of Connecticut, Sorrentino v. Rizza, Docket Number CV156013599 (behind paywall). In this case, the plaintiff failed to allege specific enough statements to form the foundation of her promissory estoppel claim. The case is a dispute over a promise of employment, and the relevant part of the complaint alleged that the defendant had promised the plaintiff "on several occasions" that she would be given "a similar position" with the defendant's company as the plaintiff already held in another company, with "a salary plus a percentage of any advertisement revenue she generated." 

This was, in the court's view, "nebulous at best." No specific dates or locations were given for the promises in question, there was no explanation of the salary that was discussed, and there were no details about what percentage of revenues the plaintiff had been promised. The plaintiff's allegations were about indefinite statements that seemed to lack any material terms. The court said those could not be construed as any "clear and definite promise" that could the plaintiff could reasonably have relied on. 

So if you think you have a promissory estoppel claim, the lesson from this case is to make sure you are very specific in relaying to the court exactly what was said and when. 

November 14, 2016 in Commentary, Labor Contracts, Recent Cases, True Contracts | Permalink | Comments (0)

Sunday, November 13, 2016

Scholarship highlight: Climate change and the "Act of God" doctrine

Allow me to highlight my most recent article, An “Act of God”? Rethinking Contractual Force Majeure in an Era of Anthropogenic Climate Change.

Given anthropogenic climate change, what were previously considered to be inexplicable and unpredictable “acts of God” cannot reasonably be said to be so anymore. They are acts of man. “Extreme” weather events have become the new normal. Accordingly, the contractual force majeure defense, which largely rests on the notion that contractual parties may be exculpated from liability for failed or delayed performances if supervening unforeseen events that the party could not reasonably control or foresee have made a performance impracticable, is becoming outdated in the weather context. It makes little sense to allow contractual parties to escape contractual performance liability for events that are highly foreseeable given today’s knowledge about climate change. Parties can and should take reasonable steps to contractually assess and allocate the risks of severe weather events much more accurately than ever before. Further, they should be better prepared to take reasonable steps to alleviate the effects of severe weather on their contractual performances instead of seeking to avoid liability at the litigation stage.

Time has come for the judiciary to rethink the availability of the impracticability defense based on “extreme” weather for public policy purposes. Perhaps most importantly, by taking a hard look at the doctrine and modernizing it to reflect current on-the-ground reality, the judiciary may help instigate a broader awareness of the underlying pollution problem and need for action at many scales. Meanwhile, a more equitable risk-sharing framework that might become known as “comparative risk sharing” and which would resemble the notion of comparative negligence in torts could be introduced where parties have failed to reach a sufficiently detailed antecedent agreement on the issue. This is surprisingly often the case. Parties often use mere boilerplate phrases that do not reflect today’s highly volatile weather and appurtenant risks.

The law is never static. It must reflect real world phenomena. Climate change is a super-wicked problem that requires attention and legal solutions at many fronts to many problems, including contractual ones. The general public is often said to have lost faith in the judiciary. Given this perception, courts could regain some of that faith in the context of contracts law and force majeure caused by events for which no “God,” other supernatural power, or even nature can be blamed.

The article can be downloaded here.

I apologize that I have not been able to post very many blogs recently and that I will, for family and work reasons, also not be able to do so until January.  I trust it that my lovely assistant Ashley and my co-bloggers will keep you intrigues until then!

November 13, 2016 in About this Blog, Commentary, Contract Profs, Current Affairs, Legislation, Miscellaneous, Science, True Contracts | Permalink

Thursday, November 10, 2016

Break on Through to the Other Side at KCON XII: Doors Cover Band "Wild Child" to Perform

 

Southwestern-law-school-logo  KCON12-Logo

Our friends at Southwestern Law School are ramping up the next edition of this blog's favorite conference, The 12th Annual International Conference on Contracts, better known as KCON XII, to be held on February 24-25, 2017 at the Art Deco Landmark in Los Angeles.

The latest development is the marquee entertainment, as the organizers have announced that "Wild Child," a talented cover band of The Doors, will play live on Friday, February 24.

We'll let the band speak for itself on what to expect:

WildChild-KCON12Wild Child - Dave Brock's Doors Experience is the Los Angeles based act with over 20 solid years of world tour experience and has flourished in the competitive L.A. Music Scene. Faithfully re-creating a live Doors Concert on stage. The music is painstakingly reproduced and combined with the voice, look and essence of Jim Morrison live on stage (performed by lead singer Dave Brock). Wild Child tries to mirror the depth, energy and emotion of The Doors concerts as they were live back in the late 1960's. The Band also utilizes the same musical instruments live as The Doors did over 40 years ago. Wild Child performs internationally, playing to packed venues around the globe.

Front man, Dave Brock, started his role as the Lizard King by grabbing the lead in the" Jim Morrison Rock Opera," produced by the late legends sister, Anna Morrison Graham. Anna personally selected Brock for the part. From there, he started the band "Wild Child," whose reputation rapidly spread from Southern California to remote areas of the world. Wild Child's first show at The Whisky a-Go-Go was on July 3rd, 1986. A long string of sell out shows at The Whisky has continued for Wild Child to this date. Wild Child broke right into the national act venue circuit, and continues to play across the country and abroad to packed touring act venues. Many experts have complimented Wild Child's rendition of a Doors concert, some of which are listed on the Press page of this site. Concert goers leave Wild Child concerts in amazement and disbelief, many of which are quoted here at Fan Reviews. The band relies on stage craft and musicianship to create an event that people will remember, without corn ball antics and pretentious banter. This is a serious, touring re-creation stage show!

More information about Wild Child, including photos, are available here.

Omni-los-angeles-hotel-exteriorThis event should be an unforgettable night. Be sure to register for the conference and book reservations at the conference hotel before the December 15 deadline. Have you registered yet for KCON XII? Conference registration and hotel information is available here. Registration by December 15, 2016 will get you the early-bird rate of $250. You should also register and book your room at the Omni Los Angeles Hotel while discounted rooms in the conference block are still available. Remember also to respond to the Call for Participation, which we previously highlighted here.

November 10, 2016 in Conferences | Permalink

Weekly Top Ten SSRN Contracts Downloads (November 10, 2016)

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SSRN Top Downloads For SSRN Logo2
Contracts & Commercial Law eJournal

Rank Downloads Paper Title
1 431 The Reform of the French Law of Obligations: Les Jeux Sont Faits
Jan M. Smits and Caroline Calomme
Maastricht University Faculty of Law - Maastricht European Private Law Institute (M-EPLI) and Maastricht European Private Law Institute (M-EPLI)
2 297 The Law of Smart Contracts
Max Raskin
New York University (NYU), School of Law
3 277 The Role of the State in Contract Law: The Common-Civil Law Divide
Mariana Pargendler
Fundação Getulio Vargas Law School at São Paulo
4 264 Inside Safe Assets
Anna Gelpern and Erik F. Gerding
Georgetown University Law Center and University of Colorado Law School
5 206 Online RPM and MFN Under Antitrust Law and Economics
Pinar Akman and D. Daniel Sokol
University of Leeds and University of Florida - Levin College of Law
6 172 Is Privacy Policy Language Irrelevant to Consumers?
Lior Strahilevitz and Matthew B. Kugler
University of Chicago Law School and Northwestern University - Pritzker School of Law
7 163 Tort Reform through the Backdoor: A Critique of Law & Apologies
Yonathan A. Arbel and Yotam Kaplan
Harvard Law School and Hebrew University of Jerusalem
8 160 'All the World's a Stage': The Seven Ages of Unjust Enrichment
Graham Virgo
University of Cambridge - Faculty of Law
9 158 Optimal Fee-Shifting Bylaws
Albert H. Choi
University of Virginia School of Law
10 128 The Grey Hole Problem in Commercial Boilerplate
Stephen J. Choi, G. Mitu Gulati and Robert E. Scott
New York University School of Law, Duke University School of Law and Columbia University - Law School

 

SSRN Top Downloads For SSRN Logo2
Law & Society: Private Law - Contracts eJournal

Rank Downloads Paper Title
1 432 The Reform of the French Law of Obligations: Les Jeux Sont Faits
Jan M. Smits and Caroline Calomme
Maastricht University Faculty of Law - Maastricht European Private Law Institute (M-EPLI) and Maastricht European Private Law Institute (M-EPLI)
2 297 The Law of Smart Contracts
Max Raskin
New York University (NYU), School of Law
3 277 The Role of the State in Contract Law: The Common-Civil Law Divide
Mariana Pargendler
Fundação Getulio Vargas Law School at São Paulo
4 160 'All the World's a Stage': The Seven Ages of Unjust Enrichment
Graham Virgo
University of Cambridge - Faculty of Law
5 158 Optimal Fee-Shifting Bylaws
Albert H. Choi
University of Virginia School of Law
6 131 Signing Without Reading
Gerrit De Geest
Washington University in Saint Louis - School of Law
7 110 Crowdfunding Investment Contracts
Jack Wroldsen
Oklahoma State University Spears School of Business
8 102 The Illiberty of Contract
Donald J. Smythe
California Western School of Law
9 83 Financial Contracting in Crowdinvesting: Lessons from the German Market
Lars Klöhn, Lars Hornuf and Tobias Schilling
Humboldt University of Berlin - Faculty of Law, University of Trier and Humboldt University of Berlin - Faculty of Law
10 77 First or Second Best? Judicial Law-Making in European Private Law
Chantal Mak
University of Amsterdam - Centre for the Study of European Contract Law (CSECL)

 

November 10, 2016 in Recent Scholarship | Permalink | Comments (0)

CALL FOR PRESENTATION PROPOSALS

 

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Institute for Law Teaching and Learning—Summer 2017 Conference

Teaching Cultural Competency and Other Professional Skills Suggested by ABA Standard 302

July 7-8, 2017

University of Arkansas at Little Rock William H. Bowen School of Law

 

ABA Standard 302 requires all law schools to establish learning outcomes in certain areas, such as knowledge of substantive and procedural law, legal analysis and reasoning, and the exercise of professional and ethical responsibilities. While requiring outcomes in these areas, however, the ABA also has given law schools discretion under Standard 302(d) to individualize their programs by establishing learning outcomes related to “other professional skills needed for competent and ethical participation as a member of the legal profession.” These other professional skills “are determined by the law school and may include skills such as interviewing, counseling, negotiation, fact development and analysis, trial practice, document drafting, conflict resolution, organization and management of legal work, collaboration, cultural competency and self-evaluation.” This language encourages law schools to be innovative and to differentiate themselves by creating learning outcomes that are consistent with their own unique values and particular educational mission.

The Institute for Law Teaching and Learning invites proposals for conference workshops addressing the many ways that law schools are establishing learning outcomes related to “other professional skills,” particularly the skills of cultural competency, conflict resolution, collaboration, self-evaluation, and other relational skills. Which, if any, of the outcomes suggested in Standard 302(d) have law schools established for themselves, and why did they select those outcomes? How are law professors teaching and assessing skills such as cultural competency, conflict resolution, collaboration, and self-evaluation? Have law schools established outcomes related to professional skills other than those suggested in Standard 302(d)? If so, what are those skills, and how are professors teaching and assessing them?

The Institute welcomes proposals for workshops on the teaching and assessment of such skills in doctrinal, clinical, externship, writing, seminar, hybrid, and interdisciplinary courses. Workshops can address the teaching or assessment of such skills in first-year courses, upper-level courses, required courses, electives, academic support teaching, or extracurricular programs. Workshops can present innovative teaching materials, teaching methods, course designs, assessment methods, curricular, or program designs. Each workshop should include materials that participants can use during the workshop and also when they return to their campuses. Presenters should model best practices in teaching methods by actively engaging the workshop participants.

The Institute invites proposals for 60-minute workshops consistent with a broad interpretation of the conference theme. To be considered for the conference, proposals should be one single-spaced page (maximum) and should include the following information:

  • the title of the workshop;
  • the name, address, telephone number, and email address of the presenter(s);
  • a summary of the contents of the workshop, including its goals and methods; and
  • an explanation of the interactive teaching methods the presenter(s) will use to engage the audience.

The Institute must receive proposals by February 1, 2017. Submit proposals via email to Kelly Terry, Co-Director, Institute for Law Teaching and Learning, at ksterry@ualr.edu.

Conference Details

 

Schedule of Events:

The UALR Bowen School of Law will host a welcome reception on the evening of Thursday, July 6. The conference will consist of concurrent workshop sessions that will take place at the law school all day on Friday, July 7 and until the early afternoon on Saturday, July 8.

Travel and Lodging:

A block of hotel rooms for conference attendees has been reserved at the Little Rock Marriot Hotel, 3 Statehouse Plaza, Little Rock, AR 72201. The discounted rate will be available until June 5, 2017. Reservations may be made online by using this link: Group rate for UALR School of Law Room Block July 2017. Reservations also may be made by calling the hotel’s reservations department at 877-759-6290 and referencing the UALR Bowen School of Law/ ILTL Conference Room Block.

Fees:

The conference fee for participants is $400, which includes materials, meals during the conference (two breakfasts and two lunches), and the welcome reception on Thursday evening, July 6. The conference fee for presenters is $300.

For more information:

Please visit our website (http://lawteaching.org/conferences/2017/) or contact one of the ILTL Co-Directors:

Professor Kelly Terry

ksterry@ualr.edu; 501-324-9946

Professor Emily Grant

emily.grant@washburn.edu; 785-670-1677

Associate Dean Sandra Simpson

ssimpson@lawschool.gonzaga.edu; 509-313-3809

November 10, 2016 | Permalink

Wednesday, November 9, 2016

Here's a Nice Case to Use to Review Contract Formation, Conditions Precedent, and Promissory Estoppel

As we reach the end of the semester, I keep trying to remind my students of what we learned at the beginning of the semester, which was only a few weeks ago but feels like several lifetimes ago. As we turn our attention to our last topic of third-party rights, I don't want the students to forget the basics of contract formation. I want them to realize that contracts law builds on itself and is self-referential and so they can't just forget about the stuff that came first. 

Anyway, I say all of that to lead into this nice recent case out of the Eastern District of Pennsylvania, Killian v. Ricchetti, Civil Action No. 16-2874, that deals with issues of contract formation, and then turns to promissory estoppel. Exactly as I keep trying to remind my students to do! So I couldn't resist writing this case up for the blog. It serves as a nice review of a lot of what we've learned and I think I may actually use it in class. 

The alleged contract was a series of e-mails exchanged between two friends. The first e-mail set out a bunch of terms and ended with "there are more little details...it's a start." The response to the e-mail added a few additional terms. This, the court found, did not form a contract, because the response was not an acceptance but rather a counteroffer, due to the fact that it added terms. There was never any reply to that particular e-mail, so the counteroffer was never accepted. 

After these initial e-mails, there were further e-mails between the two regarding the real estate transactions at the heart of the alleged agreement. Those e-mails were enough to form a contract as follows: The first e-mail read, "[W]hen the Pine [Street property] is clear title we form an LLC with an equal partnership of 50% . . . ." with some further details given. The reply to the e-mail was "OF COURSE," which constituted an acceptance. However, there was a condition precedent to this contract: that the parties receive clear title on the Pine Street property in question. Due to no fault of the parties themselves, they never received this clear title, so the condition precedent never occurred, so no duties to perform under the contract ever arose. 

The court then turns to the promissory estoppel question, though. The court found here there were genuine issues of material fact whether there was a promise made and whether the other party acted in reliance on that promise. Similar issues of material fact existed for the unjust enrichment and qunatium meruit claims. Therefore, although the court granted summary judgment on the breach of contract claims, it denied summary judgment on the remaining claims. 

November 9, 2016 in Commentary, Law Schools, Recent Cases, Teaching, True Contracts, Web/Tech | Permalink | Comments (1)

Tuesday, November 8, 2016

Public outrage suspends the repayment of soldiers' bonuses.

            As we enter the week of Veteran’s Day, we should be thinking about the thousands of men, women, and families who sacrifice their lives to protect our county. Yet, what is the pentagon focusing on? Hunting down soldiers to make them payback bonuses they improperly received in 2006 to 2008 due to no fault of their own.   It wasn’t until the public outrage after the Los Angeles Times reported about the 9,700 California Guard members who were being forced to repay these bonuses that the Pentagon halted their efforts for further examination.

            These bonuses were given at the height of the Iraq war and were often distributed in the form of recruitment bonuses or student loan payments, many of which exceeded $15,000.   Many of the recipients of these bonuses served multiple tours in Iraq and Afghanistan, some who whom returned home badly wounded. Two thousand of these soldiers have been forced to repay their bonuses, and prior to the suspension, the Pentagon was going after the bonuses of another 7,700 soldiers due to paperwork errors, inadequate documentation, or other logistical problems. Consequently, many of these soldiers were having their paychecks garnished, were having to refinance their mortgages, or having to take other drastic steps to retain this money. These soldiers are also facing tax liens and harm to their credit scores because of debt collection actions. Yet, the problems don’t end there.

            While soldiers do have an appeals process available, the process is slow and the garnishment and financial demands are hitting these military families before the appeal process can be completed. The most troubling part is that the California National Guard informed Congress about this problem in 2014, yet no action was taken. Instead, it took a newspaper article raising these issues for Obama to step in and mandate the suspension of the repayment effort until more information can be gathered.

            The Pentagon rests on the notion that they owe a duty to the taxpayer, which I do not argue against. BUT, there should be a difference between people who accept a bonus KNOWING they should not have received it, and a soldier who accepts a bonus in good faith, carries out their duty, and then because of paper work is now being put in financial stress because of something entirely out of their control.

            The Pentagon is now reviewing each case “on its own merits” to determine criteria as to who should have to pay back their bonuses, or how much should be paid/forgiven. Really? Now they implement this procedure? This seems a little too late. Examining each case individually should be something done prior to going after someone’s financial livelihood – especially the soldiers of our county. For as Veteran’s Day approaches, perhaps we need to remember exactly what it means to be a veteran, and instead of turning the lives of these veterans upside down, the Pentagon should work to make these men and women – who acted in good faith – whole again and not force them into financial ruin.

November 8, 2016 | Permalink

New Contract Formation publication from Oxford Press

Second Edition

Michael Furmston and Gregory Tolhurst

  • The most detailed work available on contract formation
  • Provides practical insight into planning and drafting letters of intent, heads of agreement and similar pre-contractual documents
  • Considers drafting devices available to avoid being legally bound
  • Advises on the practical problems that may arise in the formation process and how to avoid these
  • Incorporates discussion of cases from England, Australia, Canada, the USA, Singapore and New Zealand 9780198724032

November 8, 2016 | Permalink