Contracts (LAW012C) | Fall 2018 | Professor Widen

Syllabus: LAW012C | Classroom: F109 | Meetings: Tues and Th 10:30 am to 12:20 pm* Office hours: after class | Faculty assistant: Tina Sutton ( tsutton@law.miami.edu ) | Prof. Rosen's course website

* Note: F109, Tu. and Th. from 8 am to 8:50 is reserved for make-up and review classes. 
Current Assignments: Last Modified: Wednesday, 31-Oct-2018 10:06:03 EDT
A question and answer session is available for Tuesday, October 30, and Thursday, November 1, 2018, at 8 am in Room F109.

Class meetings on October 30, and November 1, 2018:

Continue with review of assignments 24-28; add assignments 29 and 30 for Thursday, November 1, 2018.


 

 



Student work:

Make a chart detailing differences and similarities for the various defenses to contract formation; research the law on capacity for a minor.  Does a person reach the age of majority in Florida on their 18th birthday or on the day before that? [Note the wording of R2d.]

Make a chart on cross-collateralization, continuing the work done on the board in class.  How does the Arizona statute referenced on page 660 of the assigned text work?  How are payments allocated among the various purchases?






Past Assignments:
A question and answer session is available for Tuesday, October 23, and Thursday, October 25, 2018, at 8 am in Room F109.

Class meetings on October 23 & 25, 2018:

We will speak about the Lady Duff Gordon case which you are reading for Elements as a first item of business.

 A pause:  Questions and Responses:  bring your questions on any subject so far covered.

 Please remember, you are first-year students and are entitled to ask questions some might think are “stupid.”

Defenses to Contract Formation cont.
 
24.  Illegal Contracts and Capacity: pp. 483-497; pp. 502-522.
 
Of course, the courts ought not enforce a murder for hire contract. But there are a
lot of laws. What limits does the law impose on judges in their decisions to find an
illegal contract? Should courts refuse to enforce over-restrictive covenants not to compete, or ought they instead blue-pencil the clause? Which requires the court to exercise “more power”?
 
Why if you do not know that someone is drunk, may you enter into a
contract with her? Why if you do not know that someone is mentally unable to
understand the consequences of the transaction, may you enter only into a voidable
contract with him, unless the court judges the adequacy of consideration and decides that the contract is fair?
 
25. Duress and Undue Influence: pp. 522-545.
 
How is economic duress like and unlike physical duress? List the various
standards that have been suggested for finding economic duress. Evaluate them.
How is undue influence different from duress? Construct an image of Odorizzi (p. 544). Did the lawyer act ethically in so characterizing his client?


26. Active Misrepresentation and the Failure to Disclose: pp. 545-557.

What must be established to void a contract for active misrepresentation? For
failure to disclose (passive misrepresentation)?  What precisely must be disclosed when one sells a house? What about a private person selling a used car? What about a private person selling a very expensive painting?
 

 27. Good Faith:  pp. 557-565.

Can’t the General Electric Trust protect itself?  Why should Market Street owe it any duties beyond those in the text of the contract? Is good faith too mushy a concept for courts?  What gives it content?  Is it a way to bring life into law? “Good Faith” in Germanic systems and “Abuse of Right” in Frankish systems are key concepts.  Do they have a place in the common law?

28. Unconscionability: pp. 599- 607; pp. 650-692. [Note: I asked you to read the Gateway case before with ProCD.  Here, you read it again while thinking about unconscionability.]
 
What must be demonstrated to find a contract unconscionable? There are ridiculously few cases finding contracts unconscionable. Yet, lawyers often allege it. Why?
 
How has Judge Easterbrook boxed himself into the result in Gateway? Pay careful attention to n.4, p. 604.  25 million people cruised out of the U.S. in 2015.  Where will
their cases be heard?
 



Arbitration:

A proposal to amend the Federal Arbitration Act appears here: H.R.1374 - Arbitration Fairness Act of 2017. This sort of proposal is made every year, it seems, and never gets any traction--as I described in class.  The failure to act is particularly disturbing with respect to civil rights claims.  Consider this in connection with your review of syllabus topic number 22. Thank Mike Bailey for locating this link.

Background:

Andrew Tutt, On the Invalidation of Terms in Contracts of Adhesion, 30 Yale J. on Reg. (2013).

Now is a good time to start preparing for final exams.  Start early.  Be happy that you did!

Review Questions [pdf versions distributed via email]:

Consideration and reliance: What promises are enforceable?

Contract damages and other remedies: What relief is available to a plaintiff?

Offer & Acceptance: Was a contract formed?




A question and answer session is available for Tuesday, October 16, and Thursday, October 18, 2018, at 8 am in Room F109.

Class meetings on October 16 & 18, 2018:

20. Unilateral Contracts: pp. 322-335; pp. 590-599. [Add Gateway case at p. 599 through p. 607]

Why are unilateral contracts rare in real life? Be prepared to answer the questions at pp. 344-5. Why do the shrink-wrap problems arise? Do you agree with the solutions? Does Easterbrook’s legal analysis have any relation to reality?

21. Planning for the Future:  Family Context:  pp. 335-356.

On what grounds do we enforce contracts lacking in consideration? Are Chaffee’s ideas raised by the decision in Brackenbury?

22.  Mediation and Arbitration: pp. 356-364; pp. 406-418, pp. 471-480.

How do these ideas relate to the readings on “Contract Law in Life” (pp. 133-139)?
How does context matter in these alternatives to law.   

 A pause:  Questions and Responses:  bring your questions on any subject so far covered.

 Please remember, you are first-year students and are entitled to ask questions some might think are “stupid.”

Defenses to Contract Formation
 
23.  Reliance and The Statute of Frauds: pp. 307-322; pp. 419-425.
 
Shouldn’t the Statute of Frauds be called “The Statute for Defrauding the
Innocent”?  Is McIntosh an example of judicial legislation? How do sections 90 and 139 of the Restatement (Second) differ? Do you see why many courts do not follow section 139? Do we need the statute of frauds?



Comparative Law Review Questions:

When does the CISG use a statute of frauds?  Does the CISG contain a requirement of consideration for the enforcement of certain promises? Can the parties agree to private type of statute of frauds by agreeing that all amendments to an agreement must be in writing?  Such a clause is sometimes referred to as a "no oral modification clause" or a "NOM" clause.  If a NOM clause appears in an agreement governed by the CISG or the UCC, is there any way that a purported oral modification might be given effect?




A question and answer session is available for Tuesday, October 9, 2018, at 8 am in Room F109.

Class meetings on October 9 & 11, 2018:

18. Reliance as a Means to Form a Contract:  pp. 301-306; 365-383.

Consider that the law hesitates at equitable estoppel (as in Ricketts)  before it invents promissory estoppel.  Is this conservatism?  Why was there no contract in Red Owl? Do the questions in the special verdict form (at p. 369) mirror R2 sec. 90? 
 
19. Reliance and Ending the Relationship:  pp. 383-405.
 
Note the importance of legislation.  But the wisdom of the legislation raises the question of whether reliance and innovation are in tension.  Should the law prefer one over the other?


Background:

I find this little article interesting for instruction, particularly given its publication date.

Martin A. Frey And Joann E. Long, Detrimental Reliance On A Promise (Promissory Estoppel) In Oklahoma, 52 Okla. B.J. 409 (1981).




Fall Break: Widen, William H., Judge Kavanaugh and the Fifth Criteria (September 29, 2018). University of Miami Legal Studies Research Paper No. 18-29. Available at SSRN: https://ssrn.com/abstract=3257554 or http://dx.doi.org/10.2139/ssrn.3257554
A question and answer session is available for Tuesday, September 25, 2018, at 8 am in Room F109.

Class meetings on September 25 & 27, 2018:

16. Consideration 1: pp. 288-296;  pp. 237-251:
The doctrine of consideration is a mess. Read the Doctrinal Note carefully.  Make a list of that which does not constitute consideration. Consideration is a covert means for denying judicial intervention.  Does Chafee provide a better alternative?  Consideration is a doctrine of form. Examine the alternative to formalism in Ansin.

17. Consideration 2: What is bargained for? pp. 276-287; pp. 297-300:
With what does the Hamer case replace the benefit/detriment understanding of consideration? Pay careful attention to the tramp case at 290-92. What should Antillico have done to protect herself? Why wasn’t the IOU in Ricketts bargained for?
Background:

Melvin Aron Eisenberg, Principles of Consideration, 67 Cornell L.Rev. 640 (1982).

Syed Robayet Ferdous, Consideration of  Contract in English Law & Law of Bangladesh: a Comparative Study, 31 Asian Affairs 19 (2009).


A question and answer session is available for Tuesday, September 18, 2018, at 8 am in Room F109.

Class meetings on September 18 & 20, 2018:

Answer questions on damage calculations, as needed, from items 11, 12 & 13 from the syllabus.

For Tuesday September 18, read:

14.  The Rules of Contract Formation:  221-237; 574-589; Compare UCC 2-204 and Restatement 2nd sections 24, 26, 27, 33, 35, 36, 39, 50, 57, 58, 59, 59, 61, and 69.

The rules of law of offer/acceptance are mechanical. The rules depend on creating opposing pairs. Find as many paired opposites in the reading as you can, e.g., offer/preliminary negotiation.  Pay attention to whose perspective is used in the legal test, e.g., from whose perspective is it determined whether an offer has been made? Do not get lost in legal metaphors. “Meeting of minds” is a metaphor of contract. Consider what that literally means.  When was the last time that you met another mind?  Contrast the Restatement and the UCC.

Be prepared to advise Rodney Brown (234-236) and to answer why a contact was not formed in Leonard v. Pepsico (236-237).  (You may wish to view the commercial on the web). Do you agree with the result in McCutcheon?  How can you agree with something of which you are unaware? Do you agree with the result in Yauger?  With its reasoning?  Have you been in a similar situation?  Did you read the liability waiver?  Understand it?  Think it meant anything?

For Thursday, September 20, 2018, read:

15.  Contract Formation and Context: 221-226; 252-276.

Consider the interaction of the formal rules and context.  What has to be said to reach agreement in different contexts?  At a market, who makes the offer?   Can the seller decide not to sell it to you? When was the contract formed in Marvin v. Marvin?  What were its terms?  Is the case a feminist victory?  Answer the questions in n.6, p. 274. Consider the Baby M case (275-6).  Should such a contract be enforced?

Background:

For details on certain damage calculations involving deposits see:

Widen, William H., Social Justice and Deposit Return Calculations: A Study of Success and Failure in Commercial Law Reform (September 19, 2018). University of Miami Legal Studies Research Paper No. 18-30. Available at SSRN: https://ssrn.com/abstract=3252083 or http://dx.doi.org/10.2139/ssrn.3252083
A question and answer session is scheduled for Tuesday, September 4, 2018, at 8 am in Room F109.

Class meetings on September 4 & 6 , 2018:

Finish up any questions on assignment number 6 from the syllabus.  Assignment numbers 7, 8 & 9 from the syllabus.

7. Consequential Damages: pp. 108-125   Why in contract should damages caused by the breach be limited to what the  parties agreed at the time the contract was formed? Is explicit agreement required? In  Hadley, who knew what and when did they know it? Why shouldn’t all damages proximately caused by the breach be recoverable? What about damages that the  breaching party knew would occur at the time they decide to breach (but not when they entered into the contract)? How do you feel about your answers to these questions if you know that the dominant party to a contract almost always will contract out of their liability for consequential liabilities?  It is time, again, to read a contract to which you are or have been a party.  Any liability for the other party if they breached?  What liability?

8. Party Chosen Remedies: Is it a Liquidated Damages or is it a Penalty Clause? pp. 95-108
The law calls damages set in the contract that it will enforce “liquidated damages” and those that it will not enforce “penalty clauses.” Be prepared to reproduce Judge Posner’s theoretical reasons for why the court should refuse to enforce the remedy fashioned by the parties. You need not fully understand the mathematics, but try to understand the business realities.  The phrase “variable costs” might help.  In this contract, the parties may have made an economic mistake. What other reasons are suggested for refusing to enforce an agreement reached by the parties?  Would Shylock have made the loan without the agreed to remedy?  [Additionally, consider whether a liquidated damage clause or a penalty clause might be employed because the parties fear specific performance will not be available as a remedy.]

9.  Expectation Damages in Action: pp. 125-133 (to be discussed only briefly at this point}
Should the law care about how people behave? How do you explain patterns
of behavior in which people do not enforce their legal rights? What does
Llewellyn mean by law as partial insurance? How does this compare to Macaulay’s
findings? Consider what empirical projects you (alone or with others) might undertake to
explore the law in action, as contrasted to the law on the books.

Class meeting on September 6, 2018:

Assignment number 10 from the syllabus.

10.  The Reliance Interest: pp. 133-142
What was the expectation interest in Security Stove? How is a limitation of liability clause different from a party chosen remedy clause? When are you likely to sue for reliance, not expectation, damages?
 

Background:

Law Review Article:

Melvin A. Eisenberg, The Principle of Hadley v. Baxendale, 80 Cal. L. Rev. 563 (1992). 

Review:

UCC Article 2, CISG or Other: What Law Applies to the Transaction?



Class meetings on August 28, 2018:

For 8:00 am to 8:45 am, continue and finish problems on pp. 43-44; read selected provisions of the CISG: Article 1, Article 2, Article 3, Article 10, Article 11, Article 12, Article 13, Article 29, Article 95, Article 96.  Be prepared to explain: when does the CISG applies to a sale of goods transaction; when does the CISG require that some writing evidence a contract?

For 11 am to 12:20 pm, continue with questions above on the CISG.  Assignment number 5 from syllabus.  Assignment number 6 from syllabus.

6. The Expectation Interest: pp. 31-32; pp. 46-47.
     What is it to be “made whole” after someone breaks their promise? Perhaps, think about divorce.  Be prepared to answer the questions at pp. 46-47. Can your expectations not be met even if you are not certain what it is you are getting? (Think Christmas trees).

Class meetings on August 30, 2018:

From 8 am to 8:45 am; and, 11 am to 12:20 pm.

Assignment number 6 from syllabus (continued); Assignment number 7 from syllabus.

7. Consequential Damages: 108-125   Why in contract should damages caused by the breach be limited to what the  parties agreed at the time the contract was formed? Is explicit agreement required? In  Hadley, who knew what and when did they know it? Why shouldn’t all damages  proximately caused by the breach be recoverable? What about damages that the  breaching party knew would occur at the time they decide to breach (but not when they entered into the contract)? How do you feel about your answers to these questions if you know that the dominant party to a contract almost always will contract out of their liability for consequential liabilities?  It is time, again, to read a contract to which you are or have been a party.  Any liability for the other party if they breached?  What liability? 

Background:

United Nations Convention on Contracts for the International Sale of Goods (Vienna, 1980) ("CISG")

Notes on Damage Calculations
(to be read in conjunction with the questions on pp. 46-47)
Class meeting on August 21, 2018:

Continue with class reading assignments numbers 2 and 3 from syllabus.

Start reading assignment number 4 from syllabus.

4.  The UCC; pp. 32-45.  Is Electricity a Good?” (on Prof. Rosen's course website). What is special about “goods”? What is special about statutes? Be prepared to answer the questions at pp. 43-44. Why is there no definitive answer as to whether electricity is a good? Why does it matter if electricity is a good?


Class meeting on August 23, 2018:

Continue reading assignment number 4 from syllabus.  Start assignment number 5 from syllabus.

5. Specific Performance: 85-95; “Specific Performance: A Comparative Analysis” (on Prof. Rosen's course website). When is specific performance the preferred remedy in the U.S.? Is the Civilian approach more just? Be prepared to answer the questions in note 7, p. 94.
Background:

For reading assignment number 4-

Model UCC

Florida UCC-Article 2 (Sales)

New York UCC [for NY you will need to navigate a menu to find the UCC and then Article 2]

Nebraska UCC  [for Nebraska, you will need to scroll down the page to find the UCC section which you wish to review--note that there are annotations!]

United Nations Convention on Contracts for the International Sale of Goods (Vienna, 1980) ("CISG")


Class meeting on August 16, 2018:

Finish discussion of LEASE from reading assignment number 1.

Prior to class meeting study reading assignments numbers 2 and 3 from syllabus.

2. Duty (?) to Mitigate Damages: Read “Big Landlord Gouged Tenants, Court Rules” (on Prof. Rosen's course website); pp. 48 - 61; and please view powerpoint “Mitigation of Damages” (on Prof. Rosen's course website).

Come to class prepared to argue the two questions (A & B) at p. 56.
 
Why should there be a duty to mitigate damages (if there is one)?  Consider whether the mitigation doctrine imposes a duty to forgive the promise-breaker.

3. Studying Law:  What am I here for?  See pp. 2-29 (to be discussed throughout course, not specifically now.  At this time, you should carefully consider pp. 21-23, on why we begin with remedies).
Background:

For continuing discussion of LEASE-

Consumer Pamphlet: Rights and Duties of Tenants and Landlords

Florida statutes: Residential Tenancies

Florida statutes: General Statute of Frauds


Last Modified: Wednesday, 31-Oct-2018 10:06:03 EDT