ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Thursday, February 24, 2005

Earliest precursor of the UCC

The author of the first Anglo-Saxon contract statute, St. Ethelbert (or Æthelbert) of Kent, died on this day in 616.  As king of the southern Saxons and hitherto a worshiper of Odin, he was baptized a Christian by Roman missionaries in 597, and became the chief patron of the Church in England. Under the influence of the Romans, he in 604 he promulgated the first written Anglo-Saxon code of laws in England, the ninety "Dooms of Ethelbert," which includes the first native English contract statute:

If a man buy a maiden with cattle, let the bargain stand, if it be without guile; but if there be guile, let him bring her home again, and let his property be restored to him.

February 24, 2005 in Legislation | Permalink | TrackBack (0)

Today in history—February 24

1582: Aiming to fix more precisely the annual date for Easter, Pope Gregory XIII promulgates the new and more accurate "Gregorian" calendar.  The United Kingdom and its American colonies, distrusting such Papish mumbo-jumbo, won’t adopt it for another 170 years.

1786: Wilhelm Karl Grimm is born at Hanau, Germany. As a law student with his brother Jakob under Friedrich Karl von Savigny, he will be introduced to German folk tales by a book in his professor’s library.

1807: The number of U.S. Supreme Court justices is increased to seven.

1824: Farmer Seth Wyman writes to Daniel Mills, promising to pay his son Levi's expenses.

1868: Andrew Johnson becomes the first U.S. President impeached by the House of Representatives.

1909: The Hudson Motor Car Co., which will later combine with Nash Motors to form American Motors, is founded at Detroit, Michigan.

1932: Benjamin Nathan Cardozo, who has been nominated by President Hoover, is confirmed by the U.S. Senate for a seat on the U.S. Supreme Court.

1938: The man who will invent the modern sports/fashion industry, Philip H. Knight, is born in Portland, Oregon. He will begin by selling Japanese sneakers out of a trunk at high school track meets, and will later call his company "Nike" after the goddess of victory.

1942: Joseph Isadore Lieberman (Yale Law 1967), is born at Stamford, Connecticut.

1955: Computer visionary Steven Jobs is born at Green Bay, Wisconsin. Dropping out of college after a semester to design video games, he will co-found Apple Computer at age 21.

1970: National Public Radio is founded, allowing large U.S. corporations to bill some of their advertising costs as philanthropic donations.

February 24, 2005 in Today in History | Permalink | TrackBack (0)

Wednesday, February 23, 2005

News in brief

Some D.C. politicians are questioning the city’s contract with a red-light-camera firm, under which the firm makes more money the more tickets are issued.

Former New England and Buffalo quarterback Drew Bledsoe is close to signing a new contract with the Dallas Cowboys, coached by his old boss, Bill Parcells.

Perot Systems has lost a contract (and what had been thought to be a long-term partnership) with the Harvard Pilgrim HMO—a contact that makes up more than five percent of its business.

With Canada’s national sport already on ice due to a labor dispute, West Indian cricket may follow suit.

There is speculation that the U.S. government may decide to give the whole of its next contract for Navy destroyers to Mississippi’s Northrop Grumman Ship Systems, instead of splitting it with Maine’s Bath Iron Works.

Australian rugby players are concerned about the alcohol-related dismissal of a Newcastle Knights player, suggesting he was not given proper notice and a chance to defend himself before his contract termination.

A Belfast health trust employee who was caught working on a cruise ship while he was supposed to be out on sick leave claims his termination is a breach of contract.

February 23, 2005 in In the News | Permalink | TrackBack (0)

Contracts for CEOs

Ssrn_logo_3 One area of real-world contracting that gets little attention from contracts scholars is that of CEO compensation. Contracts between companies and CEOs are, for example, classic relational contracts, yet most of the debate on the subject assumes a model of arms’ length bargaining and is done by corporate law types, not contracts profs.

Nevertheless, there’s a good deal of interesting work being done by our corporate colleagues and economists. An interesting new paper on SSRN is The Good, the Bad and the Lucky: CEO Pay and Skill, by Robert Daines, Vinay B. Nair, and Lewis A. Kornhauser. The paper tries to model CEO pay and skill, and concludes that in some (but not all) situations, there is a strong correlation between the CEO’s ability and his or her pay.  The abstract:

CEO compensation varies widely, even within industries. In this paper, we investigate whether differences in skill explain these differences in CEO pay. Using the notion that skilled CEOs are more likely to continue prior good performance and to reverse prior poor performance, we develop a new methodology to detect if skill is related to pay. We find that highly paid CEOs are more skilled than their industry counterparts when firms are small, especially when there is a large shareholder and the CEO has high incentives, or when firms face few environmental constraints on managerial discretion. By contrast, pay is negatively related to skill in firms constrained by environmental conditions, especially when there is no large shareholder to monitor management or the firm is large. We also examine CEO turnovers and show that the firm's post-turnover performance is related to differences between the two CEO's pay levels. Finally, we find that a portfolio that invests in firms managed by highly paid CEOs and sells firms managed by poorly paid CEOs generates an annualized abnormal return of 8% between 1994 and 2001, but only in conditions when pay and skill are related.

February 23, 2005 in Recent Scholarship | Permalink | TrackBack (0)

Throwing the book

A big plaintiffs’ class-action firm is going after Dell Computer and lender CIT, saying that the two "prey on" "unsuspecting" consumers by engaging in a variety of activities.  The two chief complaints seem to be up-selling customers who are attracted by low advertised prices, and advertising favorable credit terms for which most consumers, as it happens, do not qualify.  The complaint charges Dell and CIT with

violating California's Consumer Legal Remedies Act (CLRA) by false advertising and bait-and-switch practices; fraud and deceit in its sales and advertising representations; breach of contract by unilaterally modifying terms and conditions of sales and financing; violating the California Business and Professions Code by knowingly distributing false and misleading information; violating the Unruh Act with unlawful retail installment contracts; engaging in deceptive practices in its financing programs; and entering into unlawful contracts and charging excessive finance charges.

February 23, 2005 in In the News | Permalink | TrackBack (0)

Battle over Good name

An ugly contract battle about who controls a major Chicago real estate brokerage and auction firm is over, but the hard feelings are still tearing up a family.  Steven Good emerged the victor in Cook County court over his father, Sheldon Good, in the struggle for control of Sheldon Good & Co. International.  But Dad is not happy.

Steven agreed to buy the 39-year-old firm from his father in 2001.  He subsequently moved to expand by bringing in partners to the firm his father founded, giving ownership interests to brokers who could bring in business.  Sheldon, who remained as a salaried chairman emeritus, making $158,000 a year on a promise not to compete, opposed the reorganization and sued for breach of contract.  But he lost on all grounds.  The pair have apparently still not spoken.

February 23, 2005 in In the News | Permalink | TrackBack (0)

Kid Rock rolls

The U.S. Court of Appeals for the Sixth Circuit has handed rapper Kid Rock a victory in a breach of contract action by former associates who claimed a share of his songs and his performances under a 1989 contract. In the case, the Kid wrote a letter to the plaintiffs in 1990 saying that he did not intend to comply with the contract. The plaintiffs waited ten years to sue.

Too late, said the court. It adopted the "complete preemption" doctrine, noting that the claims arose out of the Kid’s use of the copyrighted materials. Hence, the three-year statute of limitations applied.  Robert Ritchie v. Alvin B. Williams, No. 03-1279 (6th Cir. Jan. 11, 2005)

February 23, 2005 in Recent Cases | Permalink | TrackBack (0)

Today in history—February 23

1455: The first Western book with movable type is published, the Gutenberg Bible.  It will take more than 400 years before the first casebook is set in movable type.

1836: Troops under Antonio López de Santa Anna begin their siege of rebels at the Alamo mission near San Antonio. The rebels, who are demanding adherence to the Mexican Constitution of 1824, are led by lawyer William Barrett Travis.

1848: Lawyer and former President John Quincy Adams dies in the Capitol Building at Washington, D.C. His most lasting contribution to American political life is replacing knee britches with long pants.

1854: The English Court of Exchequer issues its decision in Hadley v. Baxendale.

1854: Three thousand Boston merchants jam Faneuil Hall for a businessmen's protest meeting against the pending Kansas-Nebraska Act, which will re-introduce slavery into areas prohibited by the old Missouri Compromise.

1905: Three Chicago businessmen and a lawyer form a new luncheon group that they call "The Rotary Club."

1908: Future lawyer and Australian Prime Minister William McMahon is born at Sydney, New South Wales.

1947: The world’s most important standard-setting body, the International Organization for Standardization, known as "ISO," is founded.

1974: Trying to test the old writers' proverb that the most lucrative kind of writing is the ransom note, the Symbionese Liberation Army asks $4 million for the release of heiress Patricia Hearst.

2003: Sociologist Robert K. Merton, the man who coined "self-fulfilling prophecy" and "role model," dies at age 92.

February 23, 2005 in Today in History | Permalink | TrackBack (0)

Tuesday, February 22, 2005

Old blog posts never die

If you remember seeing something on this blog and can't find it, remember that while only three days of posts are kept on the main page, no posts ever go away.  All of our posts are searchable through ordinary search engines like Google.  If you want to find an earlier article and know roughly when it ran, you can also click on the "Archive" link on the right  column, which will allow you to navigate to any previous week's postings.

If you want to post a link to a particular post, click on "Permalink" at the bottom of the post to take you to the page you should link to.  Don't link to the main page because it changes several times a day.

February 22, 2005 in About this Blog | Permalink | Comments (0) | TrackBack (0)

Perillo on Pothier

Josephperillo Through an accident of history, the great French legal thinker Robert Joseph Pothier is best-known as the original author of the damages rule later adopted in Hadley v. Baxendale.  But, as Joseph Perillo (left) writes in Robert J. Pothier's Influence on the Common Law of Contract, forthcoming in the Texas Wesleyan Law Review, the man's influence was far greater, reaching nearly every aspect of sales law.


The French author, Robert Joseph Pothier, had an enormous influence on the common law of contract. The whole structure of the Common Law of contracts and sales is based largely on Pothier's treatises on obligations and sales. The wisdom he passed on had its origins in ancient Rome but was reshaped by Aristotelian thinking in the Middle Ages, the Renaissance, as well as the humanism of the Enlightenment. It is well known that and that he was the o inventor of the rule in Hadley v. Baxendale. It is less well known that his influence on the common law of contracts was far more wide ranging.

February 22, 2005 in Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

More taste, less job

An employee of a Miller Beer distributor who was fired after his picture appeared in the newspaper drinking a Bud Lite, is pursuing a potential lawsuit against his late employer.  Isac Aguero, a forklift operator for CJW, Inc., an independent distributor, was out partying one evening, and the next day his convivial portrait appeared in the Racine (Wisc.) Journal Times.  Trouble was, he was holding up a bottle of the brew made by archrival Anheuser-Busch.  He was fired the next day.  Aguero is exploring whether he can be fired for such off-duty activities.

Miller itself had no hand in the firing, but it may suffer from it, since Aguero has been on radio and television nationwide telling his story.   David Letterman is apparently interested.  An online poll by the Journal Times has Racine residents voting 59-6 against his firing.

Thanks to Marie Reilly (South Carolina) for the pointer.

February 22, 2005 in In the News | Permalink | Comments (0) | TrackBack (0)

Labor unions and standards of living

From our colleagues at LaborProf Blog, this link to a study by the National Institute for Labor Relations Research on comparisons between real wages in "union shop" and "right to work" states. The study, called The Standard of Living in Right to Work States, and written by Barry Poulson, an economics professor at the University of Colorado, finds that workers in states with union shop laws have higher nominal wages than right to work states, but that when adjusted for cost-of-living and taxes, the right to work states come out on top.

February 22, 2005 in Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

News in brief

A Danish company wins a US$210 million contract to provide all the heavy equipment for a new cement plant in Nigeria.

The former manager of the Manchester City soccer club is waiting to hear whether an appeals court will uphold the £423,000 in damages he won from the club for breach of contract.

Canadian gold miner Northgate Minerals says it has started shutting down its Kerness Mine in British Columbia after workers rejected a tentative labor agreement.

The New York-New Jersey Port Authority is renegotiating its contract with its financially troubled ferry operator, reducing the operator's payments from $50,000 to approximately $10,000 a month.

The co-producers of the "Online Media Marketing and Advertising Awards" are in litigation after IAB sues MediaPost for breach of contract and infringement.

Egypt and Germany have reached agreement to jointly develop a €75 million wind-energy power station in the Zaafarana area of the Red Sea.

February 22, 2005 in In the News | Permalink | Comments (0) | TrackBack (0)

Today in history—February 22

1512: Navigator Amerigo Vespucci, the first man to realize that Christopher Columbus had found new continents, not the East Indies, dies. They were named after him chiefly because his own writings were much more widely known than Columbus’s at the time.

1630: English colonists are introduced to an Indian delicacy they call "popped corn."

1732: George Washington is born at Pope’s Creek Plantation in Westmoreland County, Virginia. 1788: Philosopher Arthur Schopenhauer, whose chief goal in life is to depress the hell out of everyone, is born at Sztutowo, Poland.

1819: Spain cedes Florida to the United States, thus ensuring Bush’s victory over Gore in 2000. Many speculate that Karl Rove is somehow involved in the transaction.

1865: Tennessee adopts a new constitution that abolishes slavery in the state.

1876: Johns Hopkins University, whose law school frequently does very well in surveys of prestige, is founded at Baltimore.

1879: Frank Woolworth opens the first of his "five and dime" stores in Utica, New York.

1932: Edward Moore Kennedy (Virginia Law 1959) is born at Brookline, Massachusetts.

1959: The first Daytona 500, the "Super Bowl of Auto Racing," is held at Daytona International Speedway.

1965: U.S. Supreme Court Justice Felix Frankfurter dies at Washington, D.C.

1965: The Kingsmen’s "Jolly Green Giant" tops the charts. One office of Libby Foods, owner of the brand, sues for trade disparagement, but another sends free boxes of vegetables for the band to give away at concerts. He lives down there in his valley // The cat stands tall and green // Well, he ain't no prize, and there's no women his size, // And that's why the cat's so mean.

February 22, 2005 in Today in History | Permalink | Comments (0) | TrackBack (0)

Monday, February 21, 2005

Top 5 Contracts Downloads, February 21

Ssrn_logo_2 From the Social Science Research Network, the most most down-loaded contracts-related papers for the 60 days ended February 21, 2005:

1.  Kevin A. Kordana & David H. Tabachnick (Virginia), Rawls and Contract Law, Last Revised: February 4, 2005

2.  Nathan Oman (Sidley Austin), Unity and Pluralism in Contract Law, Last Revised: February 4, 2005

3.  John K. Eason (Tulane), Private Motive and Perpetual Conditions in Charitable Naming Gifts: When Good Names Go, Last Revised: February 15, 2005

4.  Jeremy A. Blumenthal (Seton Hall), Law and the Emotions: The Problems of Affective Forecasting, Last Revised February 14, 2005

5.  Roy Kreitner (Tel Aviv), Fear of Contract, Last Revised: December 14, 2004

February 21, 2005 in Teaching | Permalink | Comments (0) | TrackBack (0)

Visitors wanted

The University of Idaho College of Law is looking for one or two visiting professors to cover the following courses during the 2005-2006 academic year--Contracts, Constitutional Law (Individual Liberties), Federal Courts, and possibly Property, Sales, Torts, Legal Accounting, and Jurisprudence.  Interested Faculty should contact D. Benjamin Beard, Professor of Law and Associate Dean, University of Idaho College of Law, 6th and Rayburn Streets, P.O. Box 442321, Moscow, Idaho 83844-2321.

February 21, 2005 in Miscellaneous | Permalink | Comments (0) | TrackBack (0)

News in brief

An Australian survey shows that 80 percent of technical jobs advertised over the past two years have been for temporary contract hires, not permanent jobs.

Speaking of Australia, the battle is heating up in the life-or-death struggle for a $6 billion defense contract.

Faculty at the University of Central Florida are getting close to a new contract with the school, which will include 2 percent pay raises, a better sabbatical policy, and improved feedback to faculty on performance.

New Hampshire's little SiGARMS beats out Beretta, Smith & Wesson, Springfield Armory, Heckler & Koch, and Glock to win a $23.7 million contract to provide 65,000 handguns to the Department of Homeland Security.

February 21, 2005 in In the News | Permalink | Comments (0) | TrackBack (0)

Rapper Puffy sued by publisher

Ballantine Publishing Group's Random House is suing Sean Combs (a/k/a "Puff Daddy," "Puffy," "P. Diddy") for a return of a $300,000 advance it paid for the autobiography he hasn't written.  The money was the first installment of the $1 million advance that Random House had promised in 1998 for the rapper's life story.

He never delivered, however, and apparently was also discovered talking to another publisher about the project.   Speculation is that Combs's celebrity has risen, as have the advances given to celebrity authors, and that he could demand a much bigger advance today.

February 21, 2005 in In the News | Permalink | Comments (0) | TrackBack (0)

Employee or volunteer?

A professional golfer who thought he was getting paid for his work is suing the nonprofit foundation that thought he was volunteering.  Charles Foster says he's owed money by the Next Vision Foundation, which was founded and is run by Detroit Mayor Kwame Kilpatrick's sister, Ayanna.

Foster conducted a golf clinic as part of the Chris Williams Golf Outing in June 2004.  "Mr. Foster never had a contract with the Foundation," said Ms. Kilpatrick, who says she thought he had volunteered his time.  Foster seeks $25,000 plus attorneys' fees.

February 21, 2005 in In the News | Permalink | Comments (0) | TrackBack (0)

Today in history--February 21

1431: Joan of Arc is first brought before the panel of University of Paris scholars who are charged by the English occupation government with finding some ground for executing her.  They will.

1791: John Mercer, the self-taught chemist who will start work as a bobbin weaver at age 9 but will go on to revolutionize the cotton industry, is born at Great Harwood, Lancashire.

1848: Former law student Karl Marx publishes his Communist Manifesto.

1925: The New Yorker magazine is published for the first time, so that little old ladies in Dubuque know what is happening in the Big Apple.

1936: Barbara Charlene Jordan (Boston College Law 1959), who will become the first African American Democrat to sit in the Texas Senate and later will be a professor at the University of Texas, is born at Houston.

1943: Record and film impresario David Lawrence Geffen, who will start in the mail room at the William Morris Agency but will later co-found Dreamworks SKG Studio, is born at Brooklyn, New York.

1947: Edwin Land demonstrates the first "instant camera," called the "Polaroid Land," at a meeting of New York's Optical Society of America.

1948: America's most popular sports organization, the National Association of Stock Car Automobile Racing, is founded at Daytona Beach, Florida.

1960: Cuban lawyer and caudillo Fidel Castro nationalizes all businesses in Cuba, which will ultimately result in the cutting off of trade with the U.S.

February 21, 2005 in Today in History | Permalink | Comments (0) | TrackBack (0)