Remedies Flashcards

Question

Reasonable Likelihood of Success | TRO and Preliminary Injunction

Answer 1

Plaintiff must show a reasonable likelihood that they would prevail on the merits of the underlying action—in this case, a [cause of action] *--* e.g., breach of contract.

Answer 2

Plaintiff must show they would suffer irreparable harm if the injunctive relief is not granted. Irreparable harm is harm that cannot be satisfied by legal damages. *---* This involves the uniqueness of the harm or the object of the contract involved, and the threat that it will be permanently lost if the TRO or preliminary injunction are not granted. If plaintiff seeks a TRO, also discuss why this threat of irreparable harm is so immediate that emergency relief is required.

Answer 3

The court will balance the hardship to plaintiff of denying an injunction against the hardship to defendant of granting one. *discussed harm/lack of harm done to plaintiff if injunction not granted* *discuss harm/lack of harm done to defendant if injunction is granted* *then compare whose harship is worse in one sentence* Tip: **someone who breach K is looked down upon** ## Footnote Hardships are always balanced at the TRO and preliminary injunction stage. Generally, for a court to even consider a hardship to the defendant, the defendant’s conduct should be **inadvertent** (negligence and ultrahazard), and **not intentional. **

Answer 4

Recission is the undoing of a contract. It is restitutionary remedy, which cancels the contract by plaintiff’s prompt notice of the recission and tender back of the consideration, or by plaintiff seeking recission in the lawsuit and offers to tender back the consideration. The grounds for recission must have **existed at the time of formation**, making the contract **voidable**. Grounds for recission are mutual or unilateral mistakes, or fraudulent or innocent misrepresentation.

Answer 5

1. Mistake 2. misrepresentation

Answer 6

A mutual mistake occurs when both parties are incorrect as to a basic assumption (of the material fact and) of the contract prior to or during the formation of the contract. The mistake must be as the nature or identity of the subject matter of the contract. If the rescinding party does not bear the risk of the mistake, then the contract is voidable. *---* Mutual mistake requires a mutual mistake (among all parties to the contract) as to a material fact—one that goes to the basis of the bargain.

Answer 7

Unilateral mistake occurs where one party is mistaken as to a basic assumption of the contract prior to or during the formation. The established rule grants recission only if that nonmistaken party knows or should know of the mistake. The modern trend grants recission when the mistake is basic and the mistaken party’s hardships outweighs the detriment to the nonmistaken party’s expectations under the contract. *--* Majority – non-mistaken party knows of mistake * Rule: a unilateral mistake (as to a material fact) will only be grounds for rescission if the non-mistaken party knows or should know of the mistake Modern – balance harms to each party * Rule: court grants rescission if the mistake is basic and the mistaken party’s hardship outweighs the detriment to the non-mistaken party’s expectations under the contract.

Answer 8

Misrepresentation requires: (1) a false representation of a material fact or omission of a material fact; (2) that the defendant knew was false (intentional misrepresentation), or should have known was false (negligent misrepresentation), or made innocently (innocent misrepresentation); (3) reasonably relied upon by the plaintiff to his or her detriment.

Answer 9

Reformation is the remedy by which the **court alters or modifies a written instrument**, such as a contract or deed, to make it conform to the parties’ previous mutual understanding. Reformation requires a valid prior agreement in the first place. The grounds include a **mutual mistake of fact** regarding whether the instrument conformed to the parties’ intentions, including **scrivener’s errors**, **unilateral mistake where one party knows the instrument contains an error but the other party does not,** mistake of law as to the legal meaning of terms, and fraud.

Answer 10

In a contract situation, it may issue where there is a dispute in the interpretation of the contract. The court will issue a declaratory judgment as to the parties’ rights and obligations under the contract. In constitution, declaratory relief will be granted where the government conduct is unconstitutional and where plaintiff can show they have a substantial controversy with the government - standing. *---* In a contract situation, it may issue where there is a dispute as to interpretation of a contract—such as where in an insurance policy the insured and insurer dispute whether there is policy coverage. The court will issue a declaratory judgment as to the rights and obligations of the parties under the contract, including whether the insurance company has coverage or an obligation to defend the insured.

Answer 11

Three kinds of tort damages 1. General damage 2. Special damages 3. Punitive damage ## Footnote Special damages and punitive damages must be specially pleaded in the Complaint.

Answer 12

General damages are foreseeable from the injury such as pain and suffering

Answer 13

Special Damages that could not have been foreseen from the mere occurrence of the wrong (medical expenses; lost wages)

Answer 14

Punitive damages may be awarded for willful and wanton conduct amounting to fraud, oppression, or malice. Punitive damages are subject to due process issues. ---- If they are “grossly excessive,” they may be invalid under the 14th Amendment Due Process Clause. The issue is whether the defendant had fair notice of the possible magnitude of the punitive damages. The factors in assessing notice include: (a) the reprehensibility of the defendant’s conduct; (b) the disparity between the actual or potential harm suffered and the punitive award; and (c) the difference between the punitive award and the criminal or civil penalties authorized for comparable misconduct.

Answer 15

Damages for conversion are the fair market value of the property at the time of conversion.

Answer 16

Tort compensatory damages must be causal (“but for”), foreseeable (compliant with proximate cause rules), certain, and unavoidable. But the foreseeability requirement is relaxed for intentional torts.

Answer 17

Fraud means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant to deprive a person of property or legal rights or otherwise causing injury.

Answer 18

Oppression means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.

Answer 19

Malice means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.

Answer 20

Equitable relief - Injunctive remedy * Temporary restraining order (TRO) * Preliminary injunction * Permanent injunction Provisional Remedies * TRO and Preliminary injunction are provisional remedies * Permanent injunction is not provisional remedy and only issued after trial ## Footnote with trespass or nuisance, there is usually not an adequate legal remedy because they involve harms to real property, which is always unique.

Answer 21

To obtain a permanent injunction—which is granted only after trial on the merits, the plaintiff must show: (1) an inadequate legal remedy, (2) feasibility of enforcing the injunction, and (3) a balancing of the hardships in plaintiff’s favor. ## Footnote if you are simply asked about the plaintiff’s right to an injunction, assume it is a permanent injunction, and do not discuss the provisional remedies at all.

Answer 22

Different reasons for inadequate legal remedy * Irreparable harm * Money damages inadequate * Damages are too speculative. * The potential of multiplicity of suits e.g., continuous trespass or nuisance cases * Threat of a prospective tort.

Answer 23

Generally, it is more feasible to enforce a negative or prohibitory injunction than a mandatory injunction because courts need to be able to supervise their decrees. Mandatory decrees requires the court to **sometimes continue to fashion remedies, or have continual involvement, unless the act was easy to supervise.** *---* E.g., feasible - an order to execute a deed or complete a transfer of goods for money, for example. E.g., infeasible - However, seeking a mandatory injunction to operate a business in a certain way is almost certainly infeasible due to the complexity in running a business.

Answer 24

For Tort, only balance the hardships in cases of encroachment and private nuisance.

Answer 25

Usually, the damages for property involve the **difference between the property value before and after the harm.**

Answer 26

When the harm is due to a permanent encroachment, the damages will be the diminution in value to the encroachment, or the fair rental value of the area encroached upon.

Answer 27

Use it for trespass and nuisance

Answer 28

Waste is an act by someone in rightful possession of property that does permanent injury to the land, harming the interest of someone entitled to future possession. There are three types of waste: * voluntary; * permissive; and * ameliorative.

Answer 29

Voluntary waste are deliberate destructive acts, such as cutting timber from the land without permission. *---* * Remedies * Injunction * Damages * the lesser of the diminution in value of the property both before and after the injury or * cost of repairs * Treble damages if permitted by statutes

Answer 30

Permissive waste are acts of omission or neglect, such as failing to repair conditions that have fallen into disrepair, or undertaking repairs or other acts required by a lease. *---* Remedies: * Damages * the lesser of the diminution in value of the property both before and after the injury or * cost of repairs * Note: not injunction (b/c it would require affirmative acts)

Answer 31

These are acts that alter the property but result in an increase in value *---* Remedies: * if anything, cost of restoration to their original condition in certain circumstances * injunction depends on the facts of a case e.g, yes - short-term tenant might be enjoined from making substantial changes e.g., no - long-term tenant might not be enjoined from making substantial changes Note: Not recoverable by damages

Answer 32

Restitutionary remedies are available under an unjust enrichment (quasi-contract) theory.

Answer 33

Quasi-contract imposes a legal obligation on the defendant to provide restitution for receiving a benefit and property by an **illegal or unenforceable contract** or a **wrongful retention or obtaining of property**. *---* Quasi-contract [is the name given to the legal theory] **impos[ing] a legal obligation on the defendant** who **receives a benefit pursuant to an unenforceable contract** or a **wrongful act.** Tip: * The nature and amount of the restitution is dependent on the type of agreement and the type of benefit conferred on the defendant. * if a contract is unenforceable because of the Statute of Frauds, incapacity, fraud, duress, or illegality, a defendant who has received the benefit under the unenforceable contract may be forced to make some form of restitution to avoid defendant’s unjust enrichment. Element: * Legal theory to support restitution in cases of wrongful retention of benefits and property due to: * Illegal or unenforceable contract; OR * Wrongful retention or obtaining of property (conversion/fraud)

Answer 34

* In the case of a **wrongful act**, such as **conversion**, for example, if the defendant unjustly retains the converted personal property, **specific restitution of the personal property is the appropriate remedy**. * If the defendant **wrongfully obtains goods and services without paying** for them, the **value of those goods and services is the restitutionary remedy**. * If the defendant **wrongfully obtains and keeps money, and uses it to make purchases or commingles it**, we look to **equitable remedies** such as a constructive trust, resulting trust, or equitable lien. ## Footnote * For bar exam purposes, where unjust enrichment is an issue, always consider all possible remedies as options.

Answer 35

1. Replevin 2. Ejectment

Answer 36

Replevin is a legal restitutionary remedy, where its purpose is to recover personal property that is wrongfully taken or detained. *---* Replevin is a legal restitutionary remedy, not an equitable one. Its purpose is to recover personal property that is wrongfully taken or detained. With replevin, it is possible to recover prejudgment possession of the personal property, in a proceeding for a provisional remedy called “claim and delivery.” Tip: state the general rule of replevin but then only state the relevant replevin

Answer 37

Common law replevin requires that the defendant **has possession of wrongfully taken or detained property**, and that **plaintiff must have a showing of the immediate right to reclaim the possession or title.** *---* e.g., which occurs if defendant fails to make payments. Tip: * at common law, replevin requires a showing of the immediate right to possession or title. If so, then unless the plaintiff can show an immediate right to recover, replevin is unavailable. * replevin issue also occur where there has been conversion of personal property. Yet, if the property has then been sold to a BFP, replevin is unavailable against the transferor, but is available against the BFP holder of the personal property.

Answer 38

To obtain an order of replevin in connection with the sale of goods under UCC, plaintiff must show either: (1) that the goods are specifically identified in the contract, and the plaintiff is unable to cover (obtain equivalent goods) despite reasonable attempts to do so (in which case, replevin will be granted conditioned on payment for the goods); or (2) if the buyer has made part payment and seller has not delivered the goods, and seller becomes insolvent within 10 days after receiving buyer’s payment or the goods were purchased for personal, family, or household purposes. ## Footnote only need to state one type

Answer 39

To obtain an order of replevin under the UCC, the plaintiff must show that the goods are specifically identified in the contract, and the plaintiff is unable to cover despite reasonable attempts to do so.

Answer 40

To obtain an order of replevin under the UCC, the plaintiff-buyer has made part payment and seller has not delivered the goods, and either the seller becomes insolvent within 10 days after receiving buyer’s payment or the goods were purchased for personal, family, or household purposes.

Answer 41

Ejectment is a legal restitutionary remedy to **have possession restored to a plaintiff against a defendant wrongfully in possession of real property**, [such as a tenant who holds over.] If an ejectment action is not brought timely (within the statute of limitations period), the possessor can prevail in an adverse possession action. *---* * Basis for unlawful detainer (eviction of tenant wrongfully holding over), or * If not brought within the limitations period, gives rise to adverse possession | **Remedy to restore possession of real property ** ## Footnote use in tenant holdover or adverse possession analysis

Answer 42

Generally, equitable remedies are issued at the court’s discretion to avoid injustice when there is inadequate legal remedy.

Answer 43

To impose a constructive trust on the property, the court must find that the defendant-wrongdoer is unjustly enriched from retaining the title of the property by either wrongfully obtaining plaintiff's title to the property or using the plaintiff’s proceeds to purchase full title to the property. The constructive trustee’s sole trust obligation is to convey the title of the property to the plaintiff, along with the benefit of any increase in value. *---* A constructive trust may only be imposed on property to which defendant obtains title. It thus applies to a defendant who either wrongfully obtains title to plaintiff’s property or uses proceeds of the plaintiff’s with which the defendant has been unjustly enriched to purchase full title to property. To impose a constructive trust, the court must find that retention of title to property by the defendant-wrongdoer would constitute an unjust enrichment. The sole trust obligation of the constructive trustee is to convey title to the property to the plaintiff, who also then gets the benefit of any increase in value.

Answer 44

A constructive trust provides for specific restitution of specific property that has been wrongfully acquired by a defendant. Thus, a constructive trust may only usually be imposed on property to which defendant obtains title. It thus applies to a defendant who either wrongfully obtains title to plaintiff’s property or uses proceeds of the plaintiff’s with which the defendant has been unjustly enriched, or which defendant has converted, to purchase full title to property.

Answer 45

To impose a constructive trust, the court must find that **retention of title to property **by the defendant-**wrongdoer** would constitute an **unjust enrichment.** The **sole trust obligation of the constructive trustee** is to **convey title to the property to the plaintiff**, **who also then gets the benefit of any increase in the value of the property**. So if defendant does not have full title to property, the property usually cannot be made subject to a constructive trust.

Answer 46

Constructive trust usually does not apply where the wrongdoer uses the victim’s money to commingle with his or other's money or improve his own property; or the wrongdoer conveys title. Instead, an equitable lien in the plaintiff’s favor will be applied, to the extent of the converted funds or the value of the improvement. However, if the defendant is a conscious wrongdoer who obtains the money through theft or embezzlement and commingles that victim's money with others’ money to purchase an asset, the defendant cannot block a constructive trust, and the plaintiff can elect constructive trust or equitable lien, whichever gives the plaintiff more.

Answer 47

Usually does **NOT** apply where wrongdoer commingles money or improves own property or transfers title **UNLESS** conscious wrongdoer obtains through **theft** or **embezzlement**, in which case plaintiff can **elect constructive trust or equitable lien, whichever gives plaintiff more** ^^marker^^ Otherwise, (1) where defendant commingles plaintiff’s money with their own or others’ funds, or improves their own property (as opposed to purchasing title to property) with plaintiff’s money or property or the proceeds thereof, or (2) where defendant conveys title, then: * a constructive trust against defendant is unavailable and * an equitable lien in favor of plaintiff to the extent of the converted funds or the value of the improvement will be imposed. *---* At that point, the property can be sold to pay the lien. Thus, unlike a constructive trust, plaintiff does not get the benefit of an increase in value of the property subject to the equitable lien. Elements 1. Commingled funds, improved property, funds from sale of title 2. Plaintiff not entitled to appreciation * If commingled funds, plaintiff gets lowest intermediate balance (lowest balance in the account after recalculating that balance after each deposit and withdrawal) * BUT IF wrongful act (theft / embezzlement) and funds are used to acquire title, again a constructive trust is appropriate if value of title increased *----* ^^marker^^ In some circumstances, involving a conscious wrongdoer who commits embezzlement or outright theft, a defendant who commingles money with others’ money to purchase an asset cannot block a constructive trust. | bad rule

Answer 48

An equitable lien is the appropriate remedy where the wrongdoer commingles her own funds with the funds she misappropriated from the victim and either: 1. maintains commingled funds in an account; 1. uses the funds to purchase property; or 2. sells title acquired with misappropriated funds and commingle those proceeds. Then, the equitable lien attaches to the funds remaining in the account and any property purchased with funds taken from the account. *---* Equitable Lien is the **appropriate remedy** where the **wrongdoer commingles** her own funds with the **funds she misappropriated from the victim** and **maintains commingled funds** in an account, or **uses the funds to purchase property, or sells title acquired with misappropriated funds and commingles those proceeds.** An equitable lien then lies on both the funds remaining in the account and any property purchased with funds taken from the account. *----* An equitable lien does not provide specific restitution of specific property, but instead creates a security interest for the equitable debt.

Answer 49

If the value of the stock goes **up**, plaintiff will seek to impose a **constructive trust to get the increased value of the shares. ** If the value of the stock goes **down**, plaintiff will seek an **equitable lien** against the stock and will then seek a lien in any other property needed to recover the full amount that was embezzle *----* This illustrates the principle that if the wrongdoer is a conscious wrongdoer (as opposed to a mistaken person) and through embezzlement or theft acquires assets purchased with the victim’s funds, the victim may choose a constructive trust remedy, allowing him to share in the value of his pro rata portion in the purchased assets, if the value of the converted assets increases, or an equitable lien if the value decreases.

Answer 50

1. **Failure of Express Trust** (lack of beneficiary or beneficiary is dead), equity creates a resulting trust in Settlor or Settlor’s estate, OR 2. A resulting trust is found in case of a **purchase money resulting trust** - Person who supplied some or all of consideration does not hold title. for both, Resulting trustee’s sole trust obligation is to convey the property to the plaintiff

Answer 51

When an express trust fails because the beneficiary is dead, equity creates a resulting trust in the settlor or, if the settlor is dead, the settlor’s estate.

Answer 52

A resulting trust is found in case of a purchase money resulting trust - Person who supplied some or all of consideration does not hold title. Supply of consideration but lack of title --> creates presumption of resulting trust Presumption rebutted by evidence of: * Gift from the resulting beneficiary to the resulting trustee * Loan from the resulting beneficiary to the resulting trustee * Payment of Debt - the consideration was payment of a debt owing from the resulting beneficiary to the resulting trustee.

Answer 53

A purchase money resulting trust is found where a person who takes title did not supply all or part of the consideration, but still holds title. Such a person is presumed to hold title or partial title in trust for the person who did supply the consideration—the resulting beneficiary. The resulting trustee’s sole trust obligation is to convey the property to the plaintiff. No writing is required to enforce the purchase money resulting trust.

Answer 54

The presumption of a resulting trust arising from the supply of consideration can be rebutted by proof of gift, proof of a loan, or proof of consideration from paying back debt owe from the resulting beneficiary to the resulting trustee. *---* The presumption of a resulting trust arising from the supply of consideration can be rebutted by proof of a gift from the resulting beneficiary to the resulting trustee, proof of a loan from the resulting beneficiary to the resulting trustee, or proof that the consideration was payment of a debt owing from the resulting beneficiary to the resulting trustee.

Answer 55

Misappropriation of money is often the tort of conversion. Remedies: 1. Damages for Tort Conversion? * show that specific, identifiable money was taken. * Damages include actual damages (the amount of money taken), and punitive damages. 2. Restitution under Quasi-contract? Constructive trust or Resulting trust * If specifically identify money, or * If property purchased with specifically identify money Equitable Lien * if money commingled, or * money used to improve property or buy property with another person or with defendant’s (wrongdoer’s) own funds where the wrongdoer dissipates funds from the account after commingling them, and later adds more funds, the victim seeking a remedy against the account **can then only impose an equitable lien on the lowest intermediate balance**—the lowest balance in the account after recalculating that balance after each deposit and withdrawal

Answer 56

1. Legal Remedies * Damages for conversion or trespass to chattels * Actual damage - Value of property at time of conversion * Note: actual damages are also recoverable by the true owner against the BFP. * Cost of recovery (if trespass to chattels) * Punitive damages * Replevin – * if the property has not been destroyed, plaintiff can seek the legal restitutionary remedy of replevin * if not cut off by sale, replevin is available by true owner against BFP 2. Equitable Remedies – if not cut off by sale to BFP * Constructive trust, * (if the **converter** obtains title to the property, sells the property for money, or takes that money and acquires title to some other item of personal property) * Equitable lien, or * Mandatory injunction * (only if replevin is inadequate)

Answer 57

1. Legal Remedies * Damages for conversion or trespass to chattels * Actual damage - Value of property at time of conversion * Note: actual damages are also recoverable by the true owner against the BFP. * Cost of recovery (if trespass to chattels) * Punitive damages * Replevin – * if the property has not been destroyed, plaintiff can seek the legal restitutionary remedy of replevin * if not cut off by sale, replevin is available by true owner against BFP 2. Equitable Remedies – if not cut off by sale to BFP * Constructive trust, * (if the **converter** obtains title to the property, sells the property for money, or takes that money and acquires title to some other item of personal property) * Equitable lien, or * Mandatory injunction * (only if replevin is inadequate)

Answer 58

1. Laches 2. unclean hands 3. sales to BFP 4. injunction not available ## Footnote After discussing equitable remedies, discuss equitable defenses

Answer 59

Laches is the equitable equivalent to a statute of limitations. It requires an unreasonable delay has resulted in harm to the other party - such as the loss of the ability to mount a defense due to loss or destruction of evidence. *---* Laches is the **equitable equivalent** to a **statute of limitations.** It requires: (1) an **unreasonable delay**; and (2) the **delay** has resulted in **harm** **to the other party**—such as the loss of the ability to mount a defense due to loss or destruction of evidence. The period of laches may be **shorter** than the legal statute of limitations, b**ut it cannot be longer**. Laches runs from **when a plaintiff has knowledge that a right has been infringed.**

Answer 60

The party seeking equitable relief **must not be guilty of inequitable or wrongful conduct with respect to the subject matter of the present suit**. The essence is **unfair dealing or conduct** related to the subject matter, not whether plaintiff has committed an actual tort. However, **this only applies if the party guilty of unclean hands has harmed the other party to the transaction.** Where **both parties are guilty of wrongdoing**, a court will **weigh the equities** to determine the just result.

Answer 61

The wrongdoer’s sale of property to a bona fide purchaser (BFP)** cuts off the remedies of constructive trust and equitable lien as to that BFP,** but not replevin if plaintiff is the true owner of personal property.

Answer 62

A BFP is liable for actual, but not punitive, damages to the true owner in an action for conversion of personal property.

Answer 63

Equity will not enjoin a breach of contract, because with a breach of contract, damages are generally adequate. But, where the **contract involves a unique subject matter**, so that the **legal remedy might be inadequate** and **specific performance** is available, it is **possible** that an **injunction would be available** to **aid in obtaining specific performance.**

Answer 64

No injunction against a criminal prosecution by the District Attorney can be granted without a strong showing of irreparable injury.

Answer 65

Injunctions against crimes do not fall within equity jurisdiction, unless the crime is also a public nuisance. Note: A public nuisance is one that endangers the public health and welfare.

Answer 66

Under the Statute of Frauds, certain kinds of contracts are unenforceable if they are not in writing. *----* Look at SOF in Contracts to do the analysis

Answer 67

Where both parties are guilty of wrongdoing, a court will weigh the equities ## Footnote no need for heading. mostly to counter defendant's defense