C9. Limits on the reach of contract law

Question 1

What is public policy regarding contract?

Answer 1

a. Neither a court of law nor a court of equity will lend its aid to either party to a contract founded upon an illegal or immoral consideration
i. Illegal or immoral things are not valid consideration
b. Role of morality in the judge’s opinion –
i. Judges are quick to jump because of immorality issue
c. Campaign promises
i. A political campaign promise is legally insufficient to create a binding contract unless it is so intended by the promisor and promisee
1. Limitation: unless it is so intended by the promisor and promisee (ricks: “but I have never seen this” he doesn’t think even this would amount to enforceable promise. It would be harmful to give judges the power to enforce campaign promises)

Question 2

What is the rule for plea bargain?

Answer 2

a. Plea agreements are construed in favor of the government.
b. When a ∆ entered a plea of guilty in reliance on an agreement with the government, enforcement of the agreement will be compelled.
c. When a ∆ has taken no action in reliance on the agreement, however, the contrary result obtains. An offer by the government alone, even if accepted by the ∆ under common law contract principles, does not require specific enforcement of the agreement
d. Reliance based rule for the enforcement of a contract:
i. Where a plea agreement calls for performance by the ∆ and the ∆ has performed pursuant to the terms of the agreement, the agreement will be enforced

Question 3

When can an employer not able to discharge an employee any time?

Answer 3

If doing so would violates a contractual, statutory or constitutional requirement

Question 4

What is the rule regarding covenants not to compete?

Answer 4

a. Restrictive covenants not to compete in an employment contract, though enforceable, are disfavored and will be strictly construed against the employer
i. In order to be enforceable, a covenant not to compete must be ancillary to a lawful contract supported by adequate consideration, and consistent with public policy
b. A covenant not to compete contained in an employment contract must be reasonable as applied to the:
i. Employer,
ii. Employee,
iii. And the public
c. In other words, a covenant not to compete is reasonable only If the covenant:
i. Is not greater than is necessary to protect the employer in some legitimate business interest;
ii. Is not unduly harsh and oppressive to the employee; and
iii. Is not injurious to the public (cannot protect against basic competition)
d. The general rule is that an employer is not entitled to protection against ordinary competition
e. “blue pencil approach” – sometimes the courts can rewrite the covenants