MEE practice rules Flashcards
what must a secured party do before disposing of collateral on default
- send debtor + secondary obligor(s) reasonable authenticated notification of disposition
- does not apply to collateral that is perishable, quickly declining in value, or is of a type customarily sold on a recognized market
when may a court modify the terms of a trust under common law
- unanticipated change of circs occurs
- which defeats the existing purpose(s) of the trust
when may a court modify the terms of a trust under the trust act thingy
- unanticipated change of circs
- defeats existing purpose(s) of the trust
- modification may not harm anyone with a valid interest (e.g., remaindermen) in the trust
cy pres
when no longer possible to fulfill bequest to charity b/c charity no longer exists, court will attempt to substitute a similar charity with similar objectives to receive the gift
when will most courts find a defendant acted knowingly
- defendant is aware of a high probability of a fact’s existence &
- defendant deliberately avoids learning the truth
- a few jurisdictions require actual knowledge
what is not considered a “false statement”
commercial puffery
what does an attorney who presents a pleading to a court certify
to best of knowledge, information, and belief:
(1) doc not presented for improper purposes
(2) claims, ds, & other legal contentions warranted by existing law or non-frivolous arguments about law
(3) factual contentions have evidentiary support or will likely after reasonable opp for investigation/discovery
(4) denials of factual contentions are either warranted on evidence or reasonably based on belief or lack of info
what happens if court finds representations attorney certifies by presenting pleadings untrue
it has discretion to impose sanctions on the party or the party’s attorney
what is required for sanctions to be ordered
due process
- notice to offending party
- opportunity to be heard
under safe harbor rule, what must a party do before filing motion for sanctions
- serve motion upon opposing party
- provide the opposing party with 21 days to withdraw or correct the offending pleading
court’s discretion in imposing sanctions
significant
What is the extent of sanctions a court will impose (I.e., the standard)
what would be sufficient to deter repetition of the conduct or comparable conduct by others
reqs of order imposing sanctions
describe sanctioned conduct and explain the basis for sanctions
what can a requesting party do if a party fails to make an admission and it is later proved the matter is true
move that the party who failed to admit pay the reasonable expenses, including attorney’s fees, incurred in making that proof.
upon whom may a court impose sanctions
any attorney, law firm, or party that violated Rule 11 or is responsible for the violation
when are settlement agreements made during the divorce process generally valid
if voluntarily made
when may settlement agreements made during the divorce process be set aside
if it is found to be substantially unfair due to fraud, overreaching, or duress
potentially significant factor for substantive and procedural unfairness of settlement agreements made during the divorce process, in some states
lack of independent counsel for each party
if one ex-spouse had an attorney and the other didn’t in contemplation of the divorce settlement agreement
ex-spouse with attorney may be found to have had a fiduciary duty to spouse who did not have counsel
how does fault-based divorce figure into property distribution
- ml: eliminated from consideration in many states, at least wrt matters not related to the parties’ finances
- some states restrict the use of adultery claims to determining alimony while other states consider adultery for fault only when egregious
- consideration given if dissipation of assets or other financial misconduct by one spouse
how are professional degrees/licenses dealt with during property distribution in divorce?
most states hold they are not property interests subject to equitable distribution
alimony considerations
- parties respective financial resources and needs
- contributions each has made to the marital relationship (financially, care in the home)
- duration of marriage
alimony is highly discretionary
reimbursement alimony
some states require consideration of one spouse’s support for the other’s education or training and may mandate reimbursement for such contributions or may order rehabilitative alimony (e.g., when the other spouse quits school to support)
can a codicil republish a document that is not a valid will?
by most accounts, no. Some states probate statutes allow a court the power to validate a will not executed in accordance with the statute of wills if the evidence is clear and convincing that the testator intended the document to be a will.
what can republication of a will do
cure defects that might otherwise affect the validity of bequests made under a will
incorporation by reference
a writing that is not valid as a will (i.e., unattested), but is in existence when a will is executed, maybe incorped by ref into the will if:
1. will manifest an intent to incorp the writing
2. writing to be incorped is identified with reasonable certainty
Can the word “republish” be used to incorp by reference?
No; it is a term of art that has legal consequences
slayer statute
- murderers often barred from inheriting under slayer statute
- only apply when heir killed decedent whose estate is at issue
ademption by extinction
- property specifically bequeathed or devised not in T’s estate at death
- occurs even if property has been exchanged for other property
- presumption against classifying a devise as specific; to rebut, language creating the devise must unambiguously be in form of specific devise
- under uniform probate code, specific devisee has right to any real property acquired as replacement
Wills: stock splits and dividends w/ additional shares, who do the additional shares go to
- virtually all jurisdictions treat the same way, additional shares obtained by testator go to specific devisee
rule for contracts conditioned on loans
- under modern law contain implied covenant of good faith and fair dealing
- to avoid illusory promises, courts often imply a promise to use reasonable efforts to bring about a condition to that party’s performance
expectation damages
- the normal measure of damages for breach of contract is expectation damages
- aim to give the non-breaching party the benefit of his bargain
- must be foreseeable and proved with reasonable certainty
punitive damages (breach of contact)
- not generally recoverable in boc cases
- UNLESS conduct a tort for which punitive damages may be recovered
- available in tort cases involving willful, wanton, or malicious conduct
reqs for non-expert opinion testimony
(1) rationally based on perception of witness
(2) helpful to clear understanding of testimony or to determination of fact in issue
(3) not based on scientific, technical, or other specialized knowledge
habit evidence
- narrow range of highly probative traits that are automatic, invariable patterns of behavior
- characterized by the words “always” or “invariably”
- a regular response to a given situation done without a high degree of forethought
- need not be corroborated
what is each partner in relation to the partnership, for business purposes?
an agent of the partnership
What are partners’ relative rights to manage and conduct partnership business?
equal
do acts of partners carrying on ordinary partnership business bind the partnership?
yes
when do a partner’s acts not bind the partnership
- partner has no authority to act in the manner, and
- person partner is dealing with has knowledge that he has no such authority
does a partner acting in ocob need to seek prior approval?
no, unless they have reason to believe other partners might not approve or might expect to be consulted
dissocation, basic
withdrawal of partner from partnership
when and how may partner dissociate
- power to do so at any time, rightfully or wrongfully
- by expressly stating intention
when is partner dissociated
when partnership receives notices of partner’s express intent to withdraw
is dissociation from at will partnership wrongful?
no, so long as not in breach of an express provision of the partnership agreement
what happens to partner’s interest if they dissociate without dissolution & winding up?
partnership must purchase dissociated partner’s interest for a buyout price
what is the buyout price of a dissociated partner’s share
must be the greater of either
(1) the liquidation value of the partnership’s assets based on a sale of the entire business as a going concern, or
(2) if no purchase of interest within 120 days after written demand for payment, partnership estimates & pays buyout price
liability of members of llc
up to the amount member contributed unless there is cause to “pierce the corporate veil”
when must corporate bylaws be adopted and why then
during organizational meeting as part of completing the organization of the corporation
rebuttable presumption created by business judgment rule
when making a business decision, directors & officers acted:
- on informed basis
- in good faith
- with honest belief decision in corp’s best interest
llc def’n
- unincorped association
- without perpetual duration
- 1+ members
- organized & operated pursuant to LLC stat or operating agreement
operating agreement
- llc document similar to corp’s bylaws
- governs internal affairs
llc member duty of loyalty
must not compete with llc in the conduct of its business
may llc place limits on duty of loyalty?
in majority of states, yes
how does an llc place limits on duty of loyalty and under what condition
- include them in operating agreement
- on the condition they’re not manifestly unreasonable
liability provided to members by llc
limited liability
when is limited liability not provided to llc members
- proper procedures not followed during dissolution and winding up
- court decides to pierce corporate veil
operative llc law
uniform limited liability act
ulla notice requirements for llc dissolution & why the requirement exists
- llc must provide notice of dissolution to creditors
- so creditors can make claims against dissolving entity
requirements of llc dissolution notice
explanation of how creditors can enforce their claims
consequences if llc does not follow proper procedures in winding up business
- court can enforce creditor’s claim against each member
- to the extent of each members proportionate share of the claim
- up to amt of assets distributed to member during dissolution
what is piercing the corporate veil
court disregards separate corporate entity and holds shareholders or affiliated corporations liable on corporation’s obligations
what must a p demonstrate to pierce a corporate veil
- control so complete that
- corp has no separate will or existence of its own
- shareholder was alter ego of corp or mere instrumentality of parent corp
- corp form used fraudulently or for improper commingling of funds, AND
injury or unjust loss resulted to p from such
majority/controlling shareholder duty to minority shareholders
- fiduciary duty
- refrain from exercising their control to obtain a benefit from the corporation not shared proportionally
when can a court of equity intervene to compel the disbursement of dividends (corps)
- if shareholder proves directors’ refusal to declare a dividend amounted to
- fraud, bad faith, or abuse of discretioni
business judgment rule simply put
under bjr, a director or officer who makes a good faith error of business judgment will not have breached his duty of care
when does bjr apply and example
- analyzing situations where there isn’t self-dealing
- ex: analyzing a board’s decision to refrain from issuing dividends when majority shareholders are not engaging in self-dealing
when is a conflict of interest inherent for directors and officers (corporations)
when director or officer:
- contracts w/ corp to buy or sell goods or services, or
- has a personal financial interest in the transaction
what must officers prove to render self-dealing contracts not-voidable (corporations)
(1) material facts of the conflict disclosed to board
(2) transaction validly approved by a majority of disinterested directors
(3) material facts disclosed to shareholders
(4) transaction validly approved by majority of disinterested shareholders
(5) ct determines transaction fair & reasonable to corp
when will a contract that otherwise constitutes self-dealing not stand (corporations)
if
- an independent corporate fiduciary
- in an arm’s length bargain
- would have bound the corporation to the transaction
what does a fiduciary duty of loyalty prohibit directors from taking for their own benefit
any business opportunity that properly belongs to the corporation
when may directors take a business opportunity that properly belongs to the corporation for their own benefit
- opportunity fully disclosed to the corporation
- corporation given first chance to pursue
- corporation decides not to pursue
OR
- corporation could not have taken the opportunity
piercing the corporate veil factors
- extent to which corporation is undercapitalized
- extent to which
