February 2020 Flashcards
Contract
A contract is a legally enforceable agreement. Whether a contract is governed by the UCC as a sale of goods or by the common law as a services contract is determined based upon the predominant purpose of the contract. Here, the primary purpose of the contract was for the labor to renovate the kitchen and bathroom of the homeowner’s home. Thus, the common law will apply to the dispute in order to determine the homeowner’s liability
Substantial performance
Under the common law, substantial performance is required. Perfect performance is not. In order to determine the homeowner’s liability, we must look at the purpose and wording of the contract as well as the contractor’s knowledge of the homeowner’s purpose for the contract in order to determine whether the contractor has substantially performed the material terms of the contract and is entitled to payment of the full contract price.
Damages
In order to determine damages for a breach of a material term in a common law contract, you must identify the cost of performance as if the contract had been fulfilled as written and subtract the cost to remedy. In construction contracts, you must also take into account the difference in value of the property had the contract been performed as written and the value of the property with thebreach
Breach of contract
The issue here is whether the contractor’s failure to provide the additional inch of space between the vanity and the bathtub constituted a material breach and thus entitles the homeowner to avoid liability for the final contract price. In order to avoid liability for a breach of contract, a breach must be material. If the contractor has substantially performed his duties under the contract, then the homeowner will be liable for the remainder of the contract under the bathroom contract.
Joint tenancy
The initial issue is whether the husband and wife originally had a valid joint tenancy with right of survivorship. A joint tenancy with right of survivorship requires the four unities of time (joint interested created at same time), title (created under the same instrument), interest (each JT has equal interest in the property), and possession (each JT has a right to undivided possession of the property). The right of survivorship just be unambiguous. Here there is a joint tenancy since they purchased the property at the same time, with the same instrument, with clear survivorship language, and each had an undivided interest of the property and were entitled to possession. Thus, there was a joint tenancy
Lien theory states
The rule is that in a lien theory state, a mortgage does not sever a joint tenancy (JT); however, in a title approach theory jurisdiction, a mortgage does sever a JT. If severed the two joint tenants now each possess a tenancy in common.
Joinder of defendants
The issue is whether the Federal Rules of Civil Procedure require a plaintiff to file separate actions if the actions involve different legal questions. There is no such limitation in the Federal Rules. A plaintiff has the discretion to assert claims against one or more defendants and it is proper to do so when those claims arise from the same transaction or events. Furthermore, the three defendants may be jointly and severally liable for at least part of the woman’s damages (those suffered from the ambulance accident) and separate lawsuits could result in multiple or inconsistent judgments against the defendants.
Third party defendants
The issue is whether a defendant may implead a third-party defendant under the belief that the third-party defendant must indemnify the original defendant for liability.
Third-party defendants are allowed under the Federal Rules of Civil Procedure. A defendant may implead another party if the defendant believes that the other party should indemnify the defendant for all or part of any liability claim that a plaintiff successfully brings against them.
Impleading a third-party defendant will not destroy diversity of citizenship jurisdiction and the court may exercise supplemental jurisdiction over any counterclaims of the third-party defendant against the original defendant or original plaintiff if the counterclaims arise out of the same transactions orevents
Security agreement
The first issue is whether Construction Company properly executed a security agreement to Bank in Construction Company’s right to payment by Developer.
Article 9 of the UCC governs security interests. For a security interest to be created, the Debtor must have rights in the collateral, the secured party must give value to the debtor, and there must be a valid security agreement (or possession). Collateral may constitute goods, equipment, inventory, chattel paper, accounts receivable, and other classifications as illustrated under Article 9 of the UCC. A valid security agreement must be (1) in writing, (2) authenticated by the debtor, (3) sufficiently describe the collateral (it may use a UCC Art. 9 Classification), and (4) the security agreement must contain “granting” language. Security agreements may properly include an “after-acquired property” clause. For corporations, presidents of the corporation are officers of the corporation and are thus considered agents of the corporation. Agents of a corporation have the power to bind the corporation
Discharged from payment obligation
The issue is whether Developer was discharged from its payment obligation under the road- building contract by virtue of it having paid Construction Company.
Default occurs when a payment is missed or when another incident occurs that constitutes a default in accordance with the security agreement. If the security agreement contains an “acceleration clause,” then any event that constitutes a default will require the entirety of the loan to be paid upon the occurrence of the agreement’s default provisions. When the collateral constitutes an account receivable, upon default of the debtor, a secured party may collect the value of its interests by notifying other parties in privity with the debtor that the secured party has a security interest in the debtor’s accounts. Additionally, security agreements may properly include an “after-acquired property” clause. An “after-acquired property” clause is a clause which grants the secured party in property interests acquired after the execution of the security agreement. Lastly, an interest in collateral stays attached to the collateral even after sale or transfer of thecollateral
Authority
A principal can create authority in her agent in one of three ways: express actual authority, implied actual authority, or apparent authority. Express actual authority is created by the principal’s express limiting instructions to the agent. Implied actual authority is created by the principal’s conduct towards the agent, which leads them to reasonably believe they have authority to do what’s necessary on the principal’s behalf. Apparent authority is created by the principal’s manifestations to a third party that cause the third party to reasonably believe the agent has authority to act on the principal’s behalf.
Vicarious liability
Employers are generally not liable for an independent contractor’s (IC) torts, unless the employer had a nondelegable duty, the work was an inherently dangerous activity, or tort was within the scope of employment the IC was hired to do (such as a bouncer using violence to stop a fight). However, the driver likely had apparent authority that will allow Linda to be held vicariously liable for the driver’s negligence
Negligent hiring
Even when a party cannot be held vicariously liable for an independent contractor’s torts, they can be directly liable for negligent hiring. Negligent hiring is when a principal does not exercise reasonable care in the selection of their agents. If they have reason to know of a prospective agent’s past negligence or other misconduct and disregard this information, they can be found liable for negligent hiring if the agent subsequently engages in similar, foreseeable conduct as an agent.
Affirmative defense
The woman may mount an affirmative defense based on self-defense but she is unlikely to be successful.
Even if the prosecution proves the elements of battery, a defendant can establish that they were justified in committing the battery if they were acting in self-defense. The defendant must prove that they reasonably believed they were in danger of severe bodily harm or death and that they responded with an appropriate level of force.
Admissibility of eyewitness testimony
The prosecutor may introduce evidence of the friend’s statements made while the friend and woman were waiting in line, as well as evidence of the woman’s response. The prosecutor may not, however, introduce the evidence about the neighborhood behavior of the woman.
A court will admit evidence if it is relevant, which means that the evidence has some tendency to make a material fact of the case more or less likely to be true. A court will not allow all relevant evidence however, especially if the probative value of that evidence is outweighed by its prejudicial impact or its tendency to mislead the jury or confuse issues. Hearsay testimony is especially suspect. A hearsay statement is an out-of-court statement offered to prove the truth of the matter asserted. Hearsay statements are generally inadmissible unless they fit into one of a number of exceptions listed by the Federal Rules of Evidence. An adoptive admission is a statement or action that follows a statement and indicates approval of it. An adoptive admission is non-hearsay.
