ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Saturday, July 2, 2005

Today in history: July 2

1776: The American Contintental Congress adopts a resolution cutting ties with Great Britain, although a formal Declaration of Independence will come two days later.

1778: Philosopher Jean Jacques Rousseau dies at Ermenonville, France.

1819: The British Parliament passes the first Factory Act, which prohibits children under nine from working in factories, and limits hours of children 9-16 to 72 hours a week.

1839: Fifty-three captured Africans being carried aboard the Spanish ship Amistad escape and take over the ship.

1881: U.S. President James Abram Garfield is assassinated by a failed lawyer who had hoped for a job from the new administration.

1890: Congress passes the Sherman Anti-Trust Act.

1908: Future U.S. Supreme Court Justice Thurgood Marshall is born at Baltimore, Maryland.

1932: Wendy's Hamburgers entrepreneur R. David "Dave" Thomas is born at Atlantic City, New Jersey.  Six weeks later he'll be adopted by a family in Kalamazoo, Michigan.

1947: An spacecraft crashes at Roswell, New Mexico, carrying the bodies of four aliens.  The government insists that the crash was nothing but a weather balloon, but is unable to explain how four aliens came to be riding in a weather balloon.

1961: Writer Ernest Hemingway blows his head off with a double-barrelled 12-gauge English shotgun bought from Abercrombie & Fitch.  He leaves his estate in Cuba to Fidel Castro.

1964: President Johnson signs the Civil Rights Act into law.

1982: Larry Walters of Los Angeles, California, ties 45 four-foot helium-filled weather balloons to his lawnchair and sails 16,000 feet into the air over Long Beach, California, equipped with a parachute, a pellet gun, a CB radio, and some soft drinks and sandwiches.

July 2, 2005 in Today in History | Permalink | TrackBack (0)

Friday, July 1, 2005

Wisconsin Supreme Court consider what constitutes "special circumstances" under 2-714

In Mayberry v. Volkswagen of America, Inc. 692 NW2d 226 (2005), (find the opinoin here) the Supreme Court of Wisconsin considered a question of first impression for the court: what to do if a buyer (here of a Volkswagen Jetta) receives defective merchandise but later sells the goods for more than their then fair market value.  Volkswagen attempted to invoke UCC section 2-714, suggesting "special circumstances show proximate damages of a different amount" than the usual measure of damages for breach of warranty.  The court disagreed, holding that Mayberry should receive the usual measure, the difference in value between the car as warranted (probably the purchase price) and the car as accepted, unpersuaded by the contrary holding in Valenti v. Mitsubishi Motor Sales of America, Inc., 773 NE2d 1199 (Ill. App. 2002).  As the court acknowledged, however, the fact that Mayberry drove the car for two years and then received $15,100 ($900 over the car's book value) should be taken into account when determining the value of the car as accepted, undercutting Mayberry's testimony that when she accepted it the car was worth only $12,526.  It's a rare vehicle that appreciates over two years of driving! 

Another way to look at the damages, suggested by the concurring opinion (written by the same judge who wrote the majority opinion):  even if the car as accepted was worth $12,526, subsequent warranty repairs by the dealer might have caused the car to increase in value, and that would constitute "special circumstances" changing the damage amount under 2-714. 

July 1, 2005 in Recent Cases | Permalink | TrackBack (0)

Wednesday, June 29, 2005

Happy Anniversary

Rock_around_the_clock The Rock & Roll Era turns 50 today.  On this day in 1955, Bill Haley and the Comets' Rock Around the Clock became the first rock tune to hit the top of the Billboard charts.  The genre was still so undefined that the record company, Decca, billed it as a "fox trot."

(Photo: Wikipedia)

June 29, 2005 in Miscellaneous | Permalink | TrackBack (0)


From Ambrose Bierce's The Devil's Dictionary:

TARIFF, n.  A scale of taxes on imports, designed to protect the domestic producer against the greed of his consumer.

June 29, 2005 in Quotes | Permalink | TrackBack (0)

Cyberspace update

The new issue of the ABA's Cyberspace/I.P. Law Newsletter, CIPerati, is out.  As usual, there are a couple of good articles and a roundup of recent cyberspace cases, the latter by Eric Goldman of Marquette.

June 29, 2005 in Commentary | Permalink | TrackBack (2)

Today in history: June 29

69: St. Peter is crucified upside-down at Rome.

1613: Richard and Cuthbert Burbage's Globe Theater burns to the ground during a performance of Shakespeare's Henry VIII, as wind whips fire up into the thatched roof.

1858: George Washington Goethels, the Army engineer who will supervise construction of the Panama Canal, is born at Brooklyn, New York.

1880: France forces the abdication of King Pomare V and annexes Tahiti.

1925: Marvin Pipkin files a patent application for the frosted glass light bulb -- the frosting reduces glare.

1943: Eva Narcissus Boyd is born at Bellhaven, North Carolina.  While working as a part-time babysitter for songwriters Carole King and Gerry Goffin, her frenetic dancing style will inspire them to write "The Loco-Motion" -- which she'll then record under the name "Little Eva."

1988: At an auction in London, Vincent Van Gogh’s Le Pont de Trinquetaille nets $20.6 million.

June 29, 2005 in Today in History | Permalink | TrackBack (0)

Tuesday, June 28, 2005

Ban on arbitral class action is unconscionable

An arbitration provision that prohibits class action arbitrations may be unconscionable under California law, according to a new 4-3 decision by the California Supreme Court.  Ross Runkel of has commentary on the decision and a link to the opinion.

June 28, 2005 in In the News | Permalink | TrackBack (0)

Court rejects WTC owner's damages theory

World Trade Center owner Larry Silverstein has lost another round in his battle with insurance companies over the claims that arose out of the September 11 terrorist attacks.  Judge Michael Mukasey of the U.S. District Court for the Southern District of New York has held that insurers will be required to pay the "actual cash value" of the destroyed property, but only the "replacement cost" of the structure.  It is estimated that the cost to rebuild is less than the value of the buildings before their destruction.

Unlike many insurance contracts, which give the insured the right to choose which measure to accept, SR International Insurance used a form that specified that cost of replacement was the "default" measure of damages.

June 28, 2005 in In the News | Permalink | TrackBack (0)

When a lease is not a lease

Sometimes a lease is just a lease.  And sometimes it's cover for something else -- like a financing transaction.  That's one of the issues that's percolating in the United Airlines bankruptcy proceeding, and there's a goodly chunk of change hanging on the legal arguments.  At issue is some $500 million in municipal bonds used at four airports.  So far the bankruptcy court and the district court have split over whether the transactions at issue are leases or not.  Via the ABA's eSource electronic newsletter, Todd Gale of Kirkland & Ellis LLP outlines the issues.

June 28, 2005 in In the News | Permalink | TrackBack (0)

Pitt mourns Heidt

Kate_heidt The University of Pittsburgh has announced the death of commercial law teacher Kathryn Heidt , who died May 24 from complications surrounding heart surgery.  She was only 51.

"We have lost a valued colleague and friend," said Amy Boss (Temple), who worked with Heidt on a variety of projects over the years. Heidt, who earned her J.D. at Cleveland State and an LL.M. at Yale, was probably best known as the author of Environmental Obligations in Bankruptcy, the standard work on the subject.

June 28, 2005 in Contract Profs | Permalink | TrackBack (0)

Today in history: June 28

1243: One of the world's most highly regarded commercial lawyers, the Genoese Sinibaldo de Fieschi, becomes Pope Innocent IV.  He is often regarded as the creator of the modern "fictitious person" view of corporations.

1519: Charles V is elected Holy Roman Emperor.  Born and raised in the Netherlands, he said, "I speak Spanish to God, Italian to women, French to men, and German to my horse."

1635: France takes possession of Guadeloupe.

1712: Philosopher Jean Jacques Rousseau is born at Geneva, Switzerland.  He'll later have five children, and will put each in an orphanage, explaining that he'd be a poor father.

1880: Australia's most famous outlaw, bushranger Ned Kelly, is critically injured and captured after a siege at the Glenrowan Inn at Glenrowan, Victoria.

1914: The heir to the Austrian Empire, Archduke Franz Ferdinand of Austria-Este, is assassinated at Sarajevo by a Bosnian Serb, touching off what will come to be known as the First World War.

1960: President Castro seizes all U.S. oil operations in Cuba, triggering an economic boycott that will last for 45 years.

1978: In an attempt to clear up the issues involved in college admissions decisions that take race into account, the U.S. Supreme Court decides Regents of the University of California v. Bakke.

June 28, 2005 in Today in History | Permalink | TrackBack (0)

Monday, June 27, 2005

Contract and EC doctrine

From a new book, Rule of Reason: Rethinking Another Classic of EC Legal Doctrine (Annette Schrauwen, ed.  2005), an interesting piece by J.W.  Rutgers (University of Amsterdam), The Rule of Reason and Private Law or the Limits to Harmonization:

In its Communications on contract law the European Commission proposes to provide for an optional instrument which entails a comprehensive body of contract law that may apply in cross-border transactions.  One of the legal grounds for such an optional instrument, mentioned by the Commission, is Article 95 EC.  In this paper it is argued that Article 95 EC does not allow for an all-embracing instrument concerning contract law as for instance an optional instrument, since, considering the case law of the European Court of Justice, it only allows for approximation measures insofar as there is an impediment of the free movements of goods or services or a distortion of competition.

In addition, an optional instrument based on Article 95 EC will include less mandatory rules than the present national legal systems, since the number of interests recognized under European law is not as many as those included in national contract law.  It implies that an optional instrument probably includes less rules in the general interest than national contract law generally does.  This seems to include a conflict with respect to the values and aims proclaimed in the European Constitution, such as a social market economy and solidarity.  If concerns such as the protection of weaker parties cannot be included in an optional instrument because of a lack of competence, it seems contradictory to those aims and values expressed in the Constitution and the present Treaty.

June 27, 2005 in Recent Scholarship | Permalink | TrackBack (0)

Weekly Top 10

Ssrn_logo_14 Following are the top ten most-downloaded papers from the SSRN Journal of Contract and Commercial Law for the 60 days ending June 26, 2005.

1 (1) Commentary on the Acquisition Workforce, Steven L. Schooner & Christopher R. Yukins (Geo. Washington)

2 (2) Toward a Better Understanding of Anti-dilution Provisions in Convertible Securities, Michael (Proskauer Rose LLP) & Jonathan Rosen (Shelter Capital Partners)

• 3 (-) A Transactional View of Property Right, Robert P. Merges (UC-Berkeley)

4 (5) Contracts, Holdup, and Legal Intervention, Steven Shavell (Harvard)

5 (4) Free Markets Under Siege, Richard A. Epstein (Chicago)

6 (6) The Role of Groups in Norm Transformation: A Dramatic Sketch, in Three Parts, Robert B. Ahdieh (Emory)

7 (3) The Political Economy of International Sales Law, Clayton P. Gillette (NYU) & Robert E. Scott (Virginia)

8 (9) Whither Commodification?, Carol M. Rose (Yale Law School)

9 (7) Contracts and the Division of Labor, Daron Acemoglu (MIT, Econ), Pol Antras (Harvard, Econ) & Elhanan Helpman (Tel Aviv, Econ)

10 (8)  The Societas Europaea - A Step Towards Convergence of Corporate Governance Systems?, Udo C. Braendle & Juergen Noll (Vienna, Business Studies)

Last week's position in parentheses; • indicates fast-rising paper

June 27, 2005 in Recent Scholarship | Permalink | TrackBack (0)

Today in history: June 27

1542: Juan Rodriguez Cabrillo sets sail from Navidad, New Spain (now Acapulco, Mexico) to explore the coast of California.

1829: James Smithson, a wealthy English minerologist with no connection to America, dies and leaves his fortune (some $500,000) to the United States government "to found at Washington, under the name of the Smithsonian Institution, an establishment for the increase and diffusion of knowledge among men."

1844: Mormon prophet Joseph Smith, Jr., and his brother Hyrum are murdered by a mob that storms the jail at Carthage, Illinois.

1880: Helen Keller, the only Socialist Swedenborgian member of the International Workers of the World to be honored on a U.S. coin (the Alabama state quarter) is born at Tuscumbia, Alabama.

1893: A crash on the New York Stock Exchange triggers the Panic of 1893, the most severe economic downturn in U.S. history before the Great Depression.

1930: Henry Ross Perot is born at Texarkana, Texas.  While working as an employee at IBM, his bosses' refusal to listen to his ideas will lead to to start his own company, Electronic Data Systems (EDS). in 1962.

1954: The Soviet Union puts the world's first nuclear power station into operation at Obninsk, about 70 miles southwest of Moscow.

1967: The first ATM machine (made by National Cash Register) goes into operation.  It's at the Barclays Bank branch at Enfield Town in London.

1972: Twenty-seven year-old Nolan Bushnell founds Atari, Inc., which will launch the video game craze with its Pong.  He'll sell the company to Warner Communications four years later for an estimated $30 million.

1985: After more than fifty years as America's highway of dreams, U.S. Route 66 is officially decommissioned.

June 27, 2005 in Today in History | Permalink | TrackBack (0)

Sunday, June 26, 2005

Three profs visit Lithuania

Vytautas_magnus Lithuania is quickly becoming a popular spot for U.S. contracts profs to visit.  Marsha Cope Huie (Tulsa) will be heading there this fall to teach International Sales at Vytautas Magnus University (Vytauto Didžiojo universitetas) in Kaunas.  She'll be following Scott Burnham (Montana), who's also teaching there.  Eric Gouvin (Western New England) is just back from his visit there.

Experienced commercial law profs who are interested in a visit to the Baltic (courses can be done in as little as two weeks) should contact Dean Tadas Klimas.

June 26, 2005 in Contract Profs | Permalink | TrackBack (0)

Another "Great Moment in IP Licensing"

Today in history: June 26

1721: At the urging of Rev. Cotton Mather, Dr. Zabdiel Boylston gives the first smallpox inoculations in American history at Boston.  Mather had read of the procedure in a paper by a Turkish physician published in the proceedings of the Royal Society.

1819: William K. Clarkston, Jr., of New York receives the first U.S. patent for a velocipede, the forerunner of the bicycle.

1854: Nova Scotia lawyer Sir Robert Laird Borden, the future prime minister and the man on the Canadian $100 bill, is born at Grand Pre, Nova Scotia.

1894: The first U.S. patent for a gasoline-driven automobile is issued to German Karl Benz.

1909: Andreas Cornelius van Kuijk is born at Breda in the Netherlands.  As "Colonel Tom Parker," the former dogcatcher and circus performer will become singer Hank Snow's manager, and in 1955 will sign Snow's opening act, Elvis Presley, to a contract.

1934: President Roosevelt signs the Federal Credit Union Act, creating a group of tax-exempt institutions to compete with banks.

1959: The St. Lawrence Seaway officially opens, connecting the Great Lakes to the Atlantic.

1963: President Kennedy, speaking in West Berlin, famously announces "Ich bin ein Berliner," or "I am a jelly donut."

1977: At Market Square Arena in Indianapolis, Elvis Presley gives his last live concert performance.

1997: Bloomsbury Publishing issues a new novel by a first-time writer.  Harry Potter and the Philosopher's Stone by J.K. Rowling will launch a series so popular that the New York Times will have to create a separate best-seller list to prevent all of its spots being filled by Potter books.

June 26, 2005 in Today in History | Permalink | TrackBack (0)