Business Law Midterm

Question 1

Natural Law Theory

Answer 1

the idea that law is unlawful. The constitution does not give you rights, you have these rights as a human being. Rights derive from the universal truth of humanity. We all think we’re right.

Question 2

Legal Positivism

Answer 2

the law does not come from the natural order of things, from God. It comes from us. It is what people can enforce

Question 3

Legal Realism

Answer 3

the law is what actually happens. If it’s not being enforced it’s not the law NOT what is written, its what we do

Question 4

Criminal Law

Answer 4

the state punishes you because you made a misstep against the order of the state. The victim gets nothing. (Ex. rape)

Question 5

Civil Law

Answer 5

Similar to Anglo Saxxon Court, you can only get money
Ex. OJ Simpson case
Anglo American Law –> common law distinct from European Law
Very organized (predictable)
Gains flexibility in lieu of predictability

Question 6

Stare Decisis

Answer 6

decision previously made on the same issue should be followed (precedent)
Very Organized:
1. Get Evidence
2. Don't follow assumptions
3. Follow Precedent

Question 7

European Systems

Answer 7

Easy and Unfair
Laws clearly define vehicles
You are constantly updating and defining it

Question 8

Tort

Answer 8

harm, damage, or injury (that someone does to you)

Question 9

Tort of Battery

Answer 9

1. An affirmative and volitional act
2. With intent to h cause a harmful or offensive contact with the plaintiff or a third person
3. That directly or indirectly causes a harmful or offensive contact with the person of the plaintiff or an object closely identified with the persons body

Question 10

Batter

Answer 10

to hit (baseball, abuse, pancakes)

Question 11

Affirmative

Answer 11

opposite negative = no = negative act is omission

Question 12

Volitional

Answer 12

Voluntary (done by choice), can be defeated

Question 13

Intent

Answer 13

dimension of time (plan), to have a goal, to want a particular outcome

Question 14

Contact

Answer 14

with (physical) touching

Question 15

Plaintiff

Answer 15

person bringing the lawsuit

Question 16

Who decides what is harmful?

Answer 16

• A reasonable person is the measuring stick (regula) mythical creation of Anglo-American Law
• Invented Person (reasonable person)
• Ask, “What would a reasonable person think?”

Question 17

De Nova

Answer 17

when a court hears an issue they have never heard

Question 18

If a plaintiff proves all 3 characteristics of battery and the defendant has no defense:

Answer 18

then battery has occured

Question 19

Objects counting as battery

Answer 19

hat or other object (coat) close to the body counts as battery because it is considered part of the body

Question 20

(3rd Characteristic of Battery) That directly or indirectly causes a harmful or offensive contact with the person of the plaintiff or an object closely identified with the persons body
What must occur in the last characteristic?

Answer 20

EVERYTHING must occur!
-If intent was valid (towards intended or 3rd person)
-Did the defendant intend to cause a contact that a reasonable person would consider harmful or offensive
Ex. Being hit by a snowball

Question 21

Tort of Assault

Answer 21

1. An affirmative and volitional act
2. With intent to cause harmful or offensive contact with the plaintiff or a third person
   OR
   -With intent to cause an apprehension of an immediate harmful or offensive contact
3. That creates in the mind of the plaintiff a reasonable apprehension of such contact

Question 22

Apprehensive

Answer 22

to be worried and to catch

Question 23

Examples of Assault

Answer 23

1. making someone flinch

2. trying to punch someone and missing

Question 24

Prima Facie

Answer 24

?

Question 25

Tort of False Imprisonment

Answer 25

1. An affirmative and volitional act
2. With intent to confine the plaintiff or third person within boundaries set by the defendant
3. That directly or indirectly results in such confinement without a reasonable means of escape
4. And the plaintiff was either conscious of or harmed by the confinement

• Confinement is physical
• Harm is taking you from taking action you could otherwise take

Question 26

How do you prove intent?

Answer 26

1. Parking and boxing someone in a parking space on purpose *****
2. Parking and boxing someone in a parking space to park

Question 27

Tort of Intentional Infliction of Emotional Distress (I.I.E.D)

Answer 27

1. An affirmative and volitional act
2. That is either intentional or reckless:
   
   • with the purpose of inflicting severe emotional distress, or
   • with a substantial certainty that severe emotional distress will occur, or
   • with deliberate disregard for a high probability that severe emotional distress will occur
3. The act must consist of extreme and outrageous behavior
4. The plaintiff must have suffered severe emotional distress

Question 28

Tort of Trespass

Answer 28

1. An affirmative and Volitional Act
2. With intent to enter or remain upon land (or to cause some other person or thing to enter or remain upon land)
3. That belongs to another
4. Without permission

Question 29

Assumptions of Trespass

Answer 29

• Assuming people approach in the typical way, people have a right to engage the homeowner/resident
• Permission can be revoked
• No solicitation automatically revokes the license. No legal effect, you have the right to sue but there are no damages
• Has everything to do with ownership and harm to the owner

Question 30

Tort of Conversion

Answer 30

1. An affirmative and volitional act
2. With intent to exercise dominion or control over personal property
3. That belongs to another
4. Without permission
5. Where the dominion or control was so great as to render the only equitable remedy the repayment of the full value of the property in question
   (total destruction or total deprivation of ownership)

Question 31

3 types of property

Answer 31

1. Real
2. Intellectual - ideas, patents, copyrights
3. Personal - chattels, objects of ownership that can be picked up and moved around

Question 32

Examples of Conversion

Answer 32

Ex. Taking someone’s book on Tuesday and returning it on Thursday is not conversion
Ex. Taking the book and selling it on ebay or throwing it in a fireplace is total deprivation which is conversion
*If it is given back after a certain amount of time it is Trespass to Chattels

Question 33

Tort of Trespass to Chattels

Answer 33

1. An affirmative and volitional act
2. With intent to exercise dominion or control over personal property
3. That belongs to another
4. Without permission
5. Which dominion or control either harms the owners, harms the chattel, or deprives the owner of the use of her chattel

*If the remedy is to buy a new car it is conversion, if it is to fix the car it is trespass to chattels

Question 34

Tort of Fraudulent Misrepresentation

Answer 34

1. An affirmative and volitional act
2. Consisting of material facts or conditions
3. With knowledge that the facts or conditions represented are false (or with a reckless disregard for the truth)
4. Coupled with intent to induce reliance on the representations on the part of the plaintiff
5. Plaintiff must have actually relied and such reliance must have been justifiable
6. Damages stemming form the reliance

Question 35

Slander

Answer 35

Spoken (slang)

Question 36

Libel

Answer 36

Written (Library –> Books)

Question 37

Tort of Defamation (public person)

Answer 37

• where the plaintiff is a public person and the matter is of public concern
  1. An affirmative and volitional act of publication
  2. That was of and concerning the plaintiff
  3. That was false
  4. Defendant acted with either actual malice or with a reckless disregard for the truth or falsity of the statement
  5. (Truth is always an absolute defense to defamation)

Question 38

Publication

Answer 38

telling at least 1 (one) other person

Question 39

Public Person

Answer 39

People whose name or image on the front page of the newspaper, the community would recognize

Question 40

Tort of Defamation (private person)

Answer 40

• where plaintiff is a private person and the matter is of private concern
  1. An affirmative and volitional act
  2. Of a statement that tends to harm the reputation
  3. That was of & concerning the plaintiff
  4. Plaintiff was actually harmed by the statement
  5. (Truth is always an absolute defense)

Question 41

Tort of Defamation (Miscellany)

Answer 41

• Public vs. private depends on context for most plaintiffs, but some plaintiffs are always public
• Slander/Libel proof plaintiff (Lindsay Lohan and Casey Anthony)
• Per Se Defamation: wherein it is alleged that the plaintiff:
  
  • committed a serious crime
  • has a loathsome disease
  • archaic: is unchaste (women only)
• Some statements that would otherwise be defamatory may be privileged (e.g. statements in court, statements made by elected officials in the well of the senate or congress, required publications, etc.)
  
  • spousal relationships
  • court testimony (under oath)
  • police reports

Question 42

4 Privacy Torts

Answer 42

1. Misappropriation
2. Intrusion
3. Public Disclosure of Private Facts
4. False Light

Question 43

Privacy Tort # 1 (Misappropriation)

Answer 43

1. An affirmative and volitional act
2. With intent to use the identity of the plaintiff
3. Without permission
4. For advertising or other trade purposes

*Part of defining a person is context

Question 44

Privacy Tort # 2 (Intrusion)

Answer 44

1. An affirmative and volitional act
2. With intent to intrude into the plaintiff’s private affairs
3. Via unreasonable or improper means
4. From which intrusion confidential information was (or nearly was) obtained

Question 45

Privacy Tort # 3 (Public Disclosure of Private Facts)

Answer 45

1. An affirmative and volitional act of publication
2. With intent to disclose information
3. Concerning the plaintiff
4. That was private and that a reasonable person would not want publicized
5. Which was publicized to a wide audience

*NOTE: if the plaintiff is a public figure and the information is newsworthy, it may be allowed

Question 46

Privacy Tort # 4 (False Light)

Answer 46

1. An affirmative and volitional act
2. Whereby defendant intentionally published
3. To a wide audience
4. Matter that placed the plaintiff in a false light that would be highly offensive to a reasonable person
5. Defendant must have had knowledge of the falsity or have acted with a reckless disregard for the truth or falsity of the published material

*2nd best if you don’t’ think you can win with defamation

Question 47

Respondeat Superior

Answer 47

• You only need one of these NOT all five
• Liability for the employer for tortious acts committed by an employee:
  1. The act was within the scope of employment, or
  2. The act was explicitly authorized or directed by the employer or an authorized managerial agent thereof, or
  3. The actor was a manager, or
  4. The actor was an agent of employer unfit for the duty assigned, or
  5. The act was ratified after the act by employer of some authorized agent thereof with the power or authority to so ratify such action

Question 48

Defenses to Torts

Answer 48

1. Consent
2. Self-defense (without deadly force)
3. Self-defense (with deadly force)
4. Defense of others
5. Defense of Property
6. Private Necessity
7. Public Necessity

Question 49

Types of Consent (Defense to Tort)

Answer 49

1. Consent in fact (actual consent)
2. Implied in fact consent (playing contact football)
3. Implied in law consent
4. Informed consent (physicians and surgeons must get consent)
5. The emergency privilege (and good samaritan laws)
6. Consent may be invalidated by fraud, duress, or a lack of capacity

Question 50

Consent in fact

Answer 50

actual consent

Question 51

Implied in fact consent

Answer 51

playing contact football

Question 52

Implied in law consent

Answer 52

?

Question 53

Informed consent

Answer 53

physicians and surgeons must get consent

Question 54

Self Defense without deadly force (Defense to torts)

Answer 54

• An actor may use force that is not likely or intended to be deadly or to cause serious bodily harm (deadly force), if:
  
  • the actor reasonably believes that another is about to intentionally inflict an unprivileged harmful or offensive contact upon them, and
  • the force used by the actor to avoid or resist this contact is reasonable under the circumstances

Question 55

Self Defense with deadly force (defense to torts)

Answer 55

• An actor my use force that is likely or intended to cause be deadly or to cause serious bodily harm, if:
  
  • The actor reasonably believes that another is about to intentionally inflict an unprivileged harmful or offensive contact upon them, and
  • The actor reasonably believes that they are thereby being put in peril of death or serious bodily harm, and
  • The actor reasonably believes that peril can only safely be avoided by the use of deadly force (meaning retreat or the relinquishment of some right will not reasonably be seen to suffice)
• *Castle Doctrine - you can opt for deadly force after the 1st 2 have been established
  
  • (the relinquishment of some right and/or retreat never applies when the actor would be retreating from their own dwelling or relinquishing their right to bar entry to one seeking to enter it). use this if trying to get off the hook for someone battering you

Question 56

Defense of others (defense to torts)

Answer 56

-Generally, this has the same analysis as for self-defense only the actor must put themselves into the “shoes” of the person in harm’s way and may then act in any manner that would have been permitted that endangered person

Question 57

Defense of property (defense to torts)

Answer 57

• Generally, just like the analysis for self defense without deadly force
• Deadly force is NEVER allowed to defend property (tackling someone is not deadly force)

Question 58

Private Necessity (defense to torts)

Answer 58

-An actor is privileged to act when threatened (or when they reasonably believe themselves to be threatened) with imminent and serious harm and the act taken to avoid that harm is itself reasonable under the circumstances
(Boat scratching the dock during storm)

Question 59

Public Necessity (defense to torts) aka Superman Defense

Answer 59

-An actor is privileged to act if the public is throated (or the actor reasonably belies it to be threatened) with an imminent and serous harm and the act taken to avoid that harm to the public is itself reasonable under the circumstances

Question 60

Negligence Elements

Answer 60

• a tort that does not require intentionality
  1. Duty
  2. Breach
  3. Actual Cause
  4. Proximate Cause
  5. Harm

Question 61

Duty

Answer 61

• Generally, everyone has a duty to act reasonably
• For most of us, the duty is to act as a reasonable adult with:
  1. Ordinary knowledge and skill, and
  2. Any superior knowledge and skill he or she actually possesses
  3. An ordinary level of mental capacity
  4. His/Her physical attributes

Question 62

Duty for professionals

Answer 62

• to possess and exercise the skill and knowledge of an ordinary professional in the field who is in good standing in the national community of such professionals
• this applies to both actual professionals and those who hold themselves out as professionals

Question 63

Duty for minors

Answer 63

• (those older than seven and younger than fourteen), there is a lower standard:
  
  • to act as a reasonable minor with the mental capacity, physical capacity, and experience of a minor of similar age
  • UNLESS, the minor is engaged in an adult activity that is inherent dangerous
  • children younger than seven years of age CANNOT be held liable for negligence

Question 64

Special duty rules

Answer 64

Duties owed by land owners to entrants onto their land:
-Trespassers - an owner of land does NOT owe a duty of reasonability toward a trespasser, but must refrain from willful, wanton, or reckless conduct
EXCEPTIONS:
1. If the landowner either knows or should know that the trespasser is no her land, she has a duty of reasonable care toward that trespasser
2. Landowners must always warn of concealed traps
3. Landowners ALWAYS owe a duty of reasonability to trespassers
-Licensees/Invitees - those who come onto the landowners land with the consent (actual or implied) of the landowner are always owed a full duty of reasonability

Question 65

Strict Liability

Answer 65

• In some circumstances or activities, actors may be held to a very high standard of duty
• In the law, for some activities, any harm that results will automatically have liability for the actor, regardless of whether or not the actor was negligent in the ordinary sense:
  
  • Animals and strict liability
  • Abnormally dangerous activities

Question 66

Animals and Strict Liability

Answer 66

• Wild Animals - defendants will be held liable for any harms caused by the animal if they own or control said animal (Bart the Bear Example)
• Domesticated Animals - defendants will only be held to a strict liability standard if they had reason to know of the animal in question’s dangerous propensities. (if they had no such reason to know, then ordinary negligence analysis applies)

Question 67

Abnormally dangerous activities and strict liability

Answer 67

• Activities that are adjudged to be “abnormally dangerous” are subject to a strict liability standard for harms that occur as a direct result of such activities
• (there is no definitive list of activities that are abnormally dangerous, it is simply a legal concept to be applied awe to each new set of facts)

Question 68

The Duty of Rescuers

Answer 68

• Generally, there is no duty to rescue
• there is a duty to rescue those you have put in harms way
• and there is a duty to rescue a person with whom you have a “special relationship of care”
• also, a rescue once begun, must be completed (or at least its completion must be reasonably attempted)
• good samaritan laws protect rescuers from liability for harm caused during a rescue if the rescue was reasonably required and was reasonably undertaken

*there is a duty to rescue for people who profession it is to do so while they are on duty

Question 69

Breach

Answer 69

• Usually a common-sensical inquiry: “did the defendant meet their particular level of duty or not?”
• B.P.L. is a more mathematical analysis, asking whether the burden of taking precautions against the harm occurring was larger or smaller than the loss from the harm
• Usually dispositive if defendant violated a law (negligence per se)
• Not dispositive, but persuasive might be whether or not the defendant violated a custom
• Res Ipsa Loquitor - “the thing itself speaks/the thing speaks for itself”

Question 70

B.P.L

Answer 70

Burden-Profit-Loss

Question 71

Actual Cause

Answer 71

• Was the defendant’s action the “but for” cause of the plaintiff’s harm?
• Is there a cause and effect relationship between the defendants act and the plaintiffs harm?

Question 72

Proximate Cause

Answer 72

• Was the harm foreseeable by a reasonable person?
• Was the harm caused by some interceding event that was not itself foreseeable?
• Peril always invites rescue and so, harms resulting from the rescue are also attributable to the person who put the plaintiff in harms way
• the “thin skull” rule holds that you do not get to pick you plaintiff. IF the harm was for in excess of what was actually anticipated or foreseen, too bad
• Is it “fair” to hold the defendant liable for the harm?

Question 73

Defenses to Negilgence

Answer 73

• Comparative Negligence (pure)
• Comparative Negligence (the 50% rule)
• Contributory Negligence

Question 74

Comparative Negligence (pure)

Answer 74

1. Perform the ordinary negligence analysis to the plaintiffs actions
2. if all elements are satisfied, what is the percentage of the harm that may be attributed to the plaintiff’s actions?
3. Plaintiff’s recovery is then reduced by that percentage

Question 75

Comparative Negligence (the 50% rule)

Answer 75

1. Perform the ordinary negligence analysis to the plaintiffs actions
2. If all the elements are satisfied, what is the percentage of the harm that may be attributed to the plaintiff’s actions?
3. If that percentage is greater than defendant’s (51% or more), the plaintiff recovers nothing
4. If that percentage is 50% or less, plaintiff’s recovery is reduced by that percentage

Question 76

Contributory Negligence

Answer 76

1. Perform the ordinary negligence analysis to the plaintiff’s actions
2. Is the plaintiff even partially responsible for the harms by reason of her negligence
3. If the answer is yes, this is a total bar to any recovery by the plaintiff (even if the plaintiff’s percentage of responsibility was only 1%)
   * No jurisdiction uses this

Question 77

Express Assumption of Risk

Answer 77

3 requirements for an effective waiver of liability:

1. the release given to the defendant must have been clear, unambiguous, and explicit in expressing its intent to release the defendant from liability
2. the act of negligence that lead to the harm must be reasonably related to purpose for which the release was given
3. the release must not be contrary to public policy
4. (an effective release waiver is a complete bar to a plaintiff’s recovery)
   * Better than nothing but not invincible

Question 78

Implied Assumption of Risk

Answer 78

2 requirements:
1. plaintiff must have voluntarily participated in the activity that led to the harm
2 the harm fell within the “scope of risk” reasonably to be assumed by the plaintiff (those injury causing events that were either known, apparent or reasonably foreseeable possible consequences of participation)
*If both elements are satisfied, then it acts as a total bar to plaintiffs recovery

Question 79

Plaintiff Mitigated Damages

Answer 79

-the plaintiff has an affirmative duty to mirage her damages if such mitigation is possible; a failure to do so can result in a reduced award or even no award at all, depending on circumstances

Question 80

Essential Elements of a Contract

Answer 80

1. Offer
2. Acceptance
3. Consideration

Question 81

3 Types of Contracts

Answer 81

1. Express Contracts
2. Implied in Fact Contracts
3. Quasi-Contracts

Question 82

Express Contracts

Answer 82

• can be either oral or written

- can be bilateral (accepted by performance or promise to perform) or unilateral (accepted by performance)

Question 83

Implied in fact contracts

Answer 83

-formal elements of a contract not met, but the actions of the parties toward one another indicate intent to form or maintain a contractual relationship

Question 84

Quasi-Contracts

Answer 84

• based on the equitable doctrine of unjust enrichment

- only used when there is no valid contract, but equity demands that the law treat the situation as though there were

Question 85

Offers

Answer 85

-the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his or her assent to that bargain is invited and will conclude said bargain

Question 86

Offers require:

Answer 86

• a manifestation of present contractual intent
• certainty and definitiveness of terms
• communication

Question 87

Acceptance

Answer 87

• a manifestation of assent to the terms thereof mad by the offeree in a manner invited or required by the seller
• unless the means of acceptance is specified by the offer itself, the offered may accept by either a promise to perform or by performance itself

Question 88

Other responses to offers

Answer 88

1. Rejection
2. Lapse
3. Death or Incapacity
4. Counteroffers

Question 89

Rejection

Answer 89

-if the offeree rejects the offer, the offer is then automatically terminated unless the offer by its nature, could only be accepted by performance anyway

Question 90

Lapse

Answer 90

-Acceptance must be made either within a reasonable time or within the timeframe provided by the offer itself

Question 91

Death or Incapacity

Answer 91

• if either party to a potential contract either lacked the proper capacity (age, mental health, etc.) to contract, or dies or becomes legally incapacitated before the contract has been legally formed, then no contract will be formed
• HOWEVER, note that death or incapacity do not invalidate contracts formed, they merely prevent the formation of contracts

Question 92

Counteroffers

Answer 92

-made in response to offers act as rejections followed immediately by a NEW offer, which is then to be either accepted or rejected by the new offer (the original offeror)

Question 93

Revocation

Answer 93

-Except in the case of option contracts (see below), the offeror always has the power to revoke her offer so long as acceptance has not yet been made
-Should be clear and unambiguous and must be communicated in a reasonable manner to the offer
-Cannot revoke an option contract until time has expired
Ex. Deer Valley homes (6 hours)

Question 94

The Mailbox Rule

Answer 94

• when acceptance and revocations “cross in the mail” which controls, the acceptance or the revocation, the rule is as follows:
  
  • communications from the offeror become effective once they are received
  • communications from the offer become immediately effective when they are dispatched

Question 95

Consideration

Answer 95

• a “bargain for exchange”
• Generally, the law takes no interest in the objective value of what is bargained for; the “merest peppercorn” shall suffice (so long as the consideration in question was not intended to be insignificant on purpose, as that suggests fraud)
• The parties must each do something they would not otherwise have had to do (or must refrain from doing something they otherwise has the legal right to do)

Question 96

Problems in Consideration

Answer 96

• Illusory Problems
  
  • “I promise to buy all the widgets I need this year from you” or “the parties agree that they ail come to an agreement as to the price term before performance is required”
• Pre-existing duties
  
  • It is never consideration to promise to do a thing one is already obligated to do, nor to promise to refrain from doing something one already has the responsibility not to do

*You cannot give someone a gift and accept payment

Question 97

Promissory Estoppel

Answer 97

• if a contract would fail for lack of consideration but one party would thereby be materially damaged or the other was materially benefitted without a quid pro quo, equity may enforce the agreement as though it was a valid contract
• a mechanism by which an agreement that is not a contract (because of a consideration failure) gets treated as a contract because equity demands it
• type of quasi-contract

Question 98

Concise definition Promissory Estoppel

Answer 98

1. A clear and definite promise
2. Relied upon by the plaintiff
3. Which reliance was justified
4. To fail to enforce the promise would lead to an unjust result

Question 99

Problems in Consideration

Answer 99

• contract modifications require new consideration (because they are really new contracts)
• past consideration is no consideration at all (consideration should be given more or less the same moment by both parties)
• gifts are NEVER consideration

Question 100

Contract Issues

Answer 100

• ambiguity as to the terms of a contract will be resolved by courts using the following hierarchy of inquiry:
  
  1. the course of dealing between the parties
  2. Standards within the industry in question
  3. Parol Evidence (extraneous evidence)
     i. only used to aid in the interpretation of existing terms; NEVER to add a missing item
     ii. must be contemporaneous with a prior to the formation of the contract to be admissible

Question 101

The statute of frauds

Answer 101

• certain contracts MUST be in writing in order to be enforceable:
  1. the sale of property interests in land
  2. leases to be longer than 1 year
  3. contracts not to be fully performed within one year (note: the S.O.F. only applies if the contract CANNOT be performed within a year, even if only can be herculean effort)
  4. the sale of goods for more than $500
  5. Promises to pay the debt of another (note: exceptions will be made to the S.O.F. for contracts that have been partly or wholly performed)

Question 102

Tortious Interference with Contract

Answer 102

1. the existence of a valid contract or business relationship
2. knowledge of that contract or business relationship
3. intentional efforts by defendant to induce one of the parties to the contract to breach
4. actual breach of the contract
5. harm to the non-breaching party

Question 103

Anticipatory Breach

Answer 103

-if A and B have a valid contractual agreement together and A informs B in an unequivocal way that he intends to breach, B is privileged to treat that communication itself as a breach of the contract, if it would be reasonable to do so

Question 104

Excuses for Non-performance

Answer 104

(like defenses to contracts)

1. Mutual mistake
2. Unilateral mistake
3. Illegality
4. Frustration of the purpose
5. Impracticability
6. Impossibility
7. Unclean Hands
8. Laches
9. Fraud
10. Unconscionability

Question 105

Mutual mistake

Answer 105

• where the parties are each mistaken as to some material fact of the agreement
• ex. Raffles (wants to ship overseas) v. Wichelhaus
  
  • The Peerless sales to Australia in the morning. Both agree the goods will go to final destination without confirming final destination. Raffles cancels the agreement, Wichelhaus is out of making any money because he turned down other orders
  • Raffles wins

Question 106

Unilateral mistake

Answer 106

• eg. one party to a contract has made a grave mistake and now does not want to be held to the terms of the contract
• if that error was of an “innocent” type or merely consisted of a mathematical or typographical mistake
• and if that error was either recognized by the other party (or should have been recognized)
• than such may be grounds upon which the contract can be invalidated and the mistaken’s party’s performance will go unpunished
• NOTE: this is different than a “Business Error” which is a mistake of stupidity or inexperience or laziness etc., and ail never result in a valid excuse for non-performance

Question 107

Illegality

Answer 107

-a contract to perform an illegal act is no contract at all and thus, is unenforceable, even against a breaching party

Question 108

Frustration of the purpose

Answer 108

• a contract need not be performed if and when the very purpose for which is/was entered into has been frustrated through no act of either party
  
  • purpose must be known by the other party
• Example: Krell v. Henry
  
  1. Prove something materially changed outside the control of either part
  2. If they knew what the purpose was

Question 109

Impracticability

Answer 109

1. some intervening event has occurred, the non-occurance of which was a basic assumption of the contract
2. the occurrence has rendered performance for one of the parties extremely difficult and/or expensive
   
   • that difficulty is beyond that which was or could have been anticipated reasonably by the parties (ex. dead chicken, providing poultry to grocery store; not my fault so I should be let off the hook)

Question 110

Impossibility

Answer 110

• if performance of the contract becomes by no fault of either party, ACTUALLY physically impossible to perform, then performance of that contract shall be excused
• Note: not merely very expensive or difficult. Courts take this very literally; if there is any possible way, with all the money in the world, then it isn’t possible
• However, if performance has become illegal, courts will treat that as impossibility

Question 111

Unclean hands

Answer 111

-If one party has acted in bad faith or has themselves breached the contract, the other party may have its non-perfomance excused

Question 112

Laches

Answer 112

• if the plaintiff failed to protect their interest in a timely manner, they may miss the chance to do so at some point
• “sit on your hands”

Question 113

Fraud

Answer 113

-in the inducement of the contract may excuse non-performance by the not-fraudulent party

Question 114

Unconscionability

Answer 114

• *-contract terms that ‘shock the conscience of the court’ either on their face because of marked unfairness to one party will not be enforceable
• Ex: Apple-Southpark - cannot kidnap you and use for medical testing

Question 115

Remedies for Non-performance

Answer 115

1. Actual Damages
2. Benefit of the Bargain Damages
3. Liquidated Damages
4. Punitative Damages
5. Nominal Damages
6. Restitution
7. Specific Performance
8. Legal Fees and Costs

Question 116

Actual Damages

Answer 116

-cost of what was actually damaged

Question 117

Benefit of the Bargain Damages

Answer 117

-want benefits you would have received from the contract

Question 118

Liquidated Damages

Answer 118

• specified in the contract itself; can’t argue actual damages
• Ex. Verizon Wireless early termination fee

Question 119

Punitive Damages

Answer 119

-damages meant to punish, in excess of actual damages

Question 120

Restitution

Answer 120

-sell a car & the check bounces, recitation is getting the car back

Question 121

Specific Performance

Answer 121

-sue them to perform the action (painting the mural)

Question 122

Legal Fee’s and costs

Answer 122

-usually can only get attorney’s fee’s if it is in the contract (the non-breaching party gets their legal fees paid)

Question 123

2 types of agents

Answer 123

• Employees - Employer

- Independent Contractor

Question 124

Agency

Answer 124

-if you personally can do it, you can ask someone else to do it

Question 125

Factors to be looked at to determine employee/contractor status:

Answer 125

1. Skills required - makes them more likely to be independent contractor
2. Location of work
3. Tools/Materials (IC brings own tools)
4. Duration of work
5. Method of payment (Employees paid hourly/salary; IC paid for a project)
6. Can additional work be assigned?
7. When/how long is the workday?
   (Employees set schedule; IC whenever they want)
8. Work related to the principals business (employees help the business; IC does things outside the business - design a website)
9. Provision of employee benefits
10. Tax treatment
11. Degree of control (exercised over work performed) High degree –> employee; low degree–> IC

Question 126

Agency Formation

Answer 126

1. Express Agreement
2. Implied Agreement
3. Ratification
4. Estoppel

Question 127

Express Agreement (Agency)

Answer 127

-expressing the agreement written or orally

Question 128

Implied Agreement (Agency)

Answer 128

?

Question 129

Ratification

Answer 129

-so happy with results then approve, no prior approval

Question 130

Agency Estoppel

Answer 130

• always about reliance
• when the law fails
• solves the problem, there was almost agency
• Ex. Weidemeyer case (Mikey and model cars)

Question 131

Duties of Agent to Principal

Answer 131

1. Obedience
2. Good Conduct
3. Diligence/Competence
4. Inform
5. Account
6. Fiduciary duties
7. Contract (adhere to terms)

Question 132

Fiduciary duties

Answer 132

-avoid conflicts of interest, avoid self dealing, avoid self-interest, not disclose private facts

Question 133

Duties of Principal to Agent

Answer 133

1. Compensation
2. Indemnification
3. Reimbursement
4. Safe employment (applies in areas that are owned/controlled by principal)
5. Good faith & fairness
6. Contract (adhere to terms)

Question 134

Termination of Agency

Answer 134

1. Prior Agreement/conditions of agency itself
2. Mutual agreement
3. Acts of the parties (illegal act can terminate)
4. Unilateral revocation of authority (principal fires agent - could be breach)
5. Unilateral renunciation of authority (agent quits - could be breach)
6. Death or Incapacity
7. Material change of circumstance - something outside of the contract. (Hire a realtor & the house burns)

Question 135

Consent in law

Answer 135

-if you try to commit suicide by drowning and a lifeguard saves you, it is by implied consent in law

Question 136

Private Necessity vs. Self Defense

Answer 136

Self Defense - when is my battery excused?

Private Necessity - catch all. Why did I do this thing that was wrongful?

Question 137

Prima Facie Case

Answer 137

a plaintiff’s lawsuit or a criminal charge which appears at first blush to be “open and shut.”