Equity Flashcards
Torts Remedies
1) Injunctive Relief
2) Constructive Trusts
3) Equitable Liens
Contracts Remedies
1) Specific Performance
2) Rescission
3) Reformation
Injunctive Relief
Definition: D is ordered to do or refrain from doing something
Types:
1) Permanent: Issued after full trial on the merits
2) Preliminary: Issued pending trial
3) TRO: Issued pending hearing to determine preliminary injunction
Preliminary Injunctive Relief
Requirements:
1) Irreparable injury while waiting for trial
2) Likelihood of success on the merits (bond requirement)
Temporary Restraining Order
Requirements: same test as preliminary injunction
Can be ex parte (for emergencies)
1) Notice is not required
2) Adversarial proceeding is not required
Limited to 10 days (14 days in federal court)
Permanent Injunctive Relief
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Step 1: Inadequate Remedy Alternative (P’s Burden)
- Monday damages won’t work because a) irreparable injury; b) too speculative; c) continuing wrong; d) defendant is insolvent
Step 2: Protectible Interest (P’s Burden)
Step 3: Feasibility of Enforcement (P’s Burden)
- Negative Injunction: no enforcement problem
- Mandatory Injunction: look for difficulty of supervision or concern with effectively ensuring compliance
Step 4: Balancing Hardships (D’s Burden)
- Must be substantially more hardship than benefit
- No balancing if D’s conduct was willful
- Consider giving P money damages
- Hardship to the public is also relevant
Step 5: Defenses (D’s Burden)
- Unclean Hands
- Laches
- Free Speech
Constructive Trust
Imposed on improperly acquired property to which D now has title. D must return the property to P.
Equitable Liens
Imposed on improperly acquired property to which D now has title. Property will be subject to an immediate court-directed sale. Proceeds to P, deficiency judgment if proceeds are less than FMV when taken.
Rules for Constructive Trusts and Equitable Liens
1) Inadequate legal remedy alternative
- Insolvency
- Property is Unique (for constructive trusts)
2) Tracing is allowed
3) BFP will prevail over P
4) Give P superior rights over D’s other creditors
Choosing Between Constructive Trusts and Equitable Liens
If property value subsequent to taking goes up, go with constructive trust.
If property value subsequent to taking goes down, go with an equitable lien.
When D’s property cannot be traced solely to P’s property, only an equitable lien is available.
Specific Performance
Definition: D is required to perform on the contract
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Step 1: Contract is valid (P’s burden)
Step 2: Performance of P must be assured (P’s burden)
Step 3: Inadequate legal remedy alternative (P’s burden)
- Too speculative, D is insolvent, multiple suits are necessary, thing bargained for is unique
Step 4: Feasibility of enforcement (P’s burden)
- Personal service contracts are not enforceable
- Covenant not to compete (services are unique, scope is reasonable)
Step 5: Defenses (D’s burden)
- Equitable defenses: unclean hands, laches, unconscionability
- Contract defenses: mistake, misrepresentation, S/F
Recission
Definition: The original contract is considered voidable and rescinded
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Step 1: Determine if there are grounds for recision
- Mistake: mutual mistake about a material fact; unilateral mistake that other party knew or should have known about
- Misrepresentation
- Coercion
- Undue Influence
- Lack of Capacity
- Failure of Consideration
- Illegality
Step 2: Defenses
- Unclean Hands, Laches
Restitution is available if P already rendered performance
Reformation
Definition: Changes written agreement to conform with the parties’ original understanding
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Step 1: Valid Contract
Step 2: Grounds for Reformation
- Mutual mistake; unilateral mistake if other party knew
- Misrepresentation
Step 3: Defenses
- Unclean Hands, Laches
Not allowed if it would adversely affect rights of a subsequent BFP
