ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Tuesday, October 26, 2010

Judge tosses K claim against UPenn for promising Wharton degree

Aaa A student who sued Penn's Wharton School of Business for not giving him the degree he said he was promised has seen the second jury verdict in his favor tossed out by a Philadelphia federal judge.

Seems that Frank Reynolds enrolled in Penn's Executive Masters in Technology Management program, and paid some $66,000 in tuition.  The program led him to believe that it was a Wharton School program, but when he completed it he got a degree from Penn's engineering college instead.  He sued, and won a jury verdict for breach of contract for $436,000.  The judge tossed that and ordered a new trial.  The second jury found no breach, but awarded him a refund of his $66,000 in tuition on the ground that Penn had been "unjustly enriched."

The judge then tossed that verdict, holding (as reported in the newspaper) that since there was a contract between the parties, Reynolds could not recover under a theory of unjust enrichment.

Reynolds, the CEO of a Massachusetts biotech firm, is something of a collector of degrees according to his bio.  He has an MBA from MIT, an MS in Technology Management from Wharton; an MS in Engineering from Penn; an MS in Management Information Systems from Temple; an MS in Heath Administration from St. Joseph's; and an MS in Psychology from Chestnut Hill.


October 26, 2010 | Permalink | TrackBack (0)

Red Owl, Professor Kingsfield, and Mary Tyler Moore

Over at Conglomerate, Gordon Smith weaves the connections between growing up in Wisconsin, teaching Hoffman v. Red Owl Stores, and watching The Mary Tyler Moore Show and The Paper Chase.

Turns out that MTM went shopping at a Red Owl store in Minneapolis -- as you can see on the video of the show's opening he's posted on the site.  I'm older than Gordon, but I enjoyed the show, too, though the bit of trivia I recall is "Whose jersey is she wearing while washing the car?"

Unlike Gordon, I wasn't a fan of The Paper Chase,  I was more into a short-lived show called The Storefront Lawyers.  I don't have a video, but here are the Ventures with the show's VERY cool opening theme -- which fortunately doesn't sound anything like Seals & Crofts: 


Speaking of Hoffman, be sure to check out Bill Whitford's and Stewart Macauley's fascinating backgrounder, Hoffman v. Red Owl Stores: The Rest of the Story.


P.S. She's wearing Fran Tarkenton's #10 Minnesota Vikings jersey. 

October 26, 2010 in Famous Cases, Film Clips | Permalink | Comments (0) | TrackBack (0)

Markets seeing inflation ahead

Aaa Bloomberg is reporting that yields on the the Treasury's latest 5-year Treasury Inflation-Protected Securities (TIPS) offering have gone negative for the first time ever.  The dollar has also just hit a 15-year low against the yen.  Gold is 5% off its all-time high.

Which means folks are expecting inflation.  Those of you who are drafting contracts may want to keep that in mind if performance is going to take place over any extended length of time.


October 26, 2010 | Permalink | TrackBack (0)

Five stages of grading

Via our colleagues at Legal Writing Prof, a professor takes a look at the progression from Denial, to Anger, to Bargaining . . . .

Much of this can be avoided with multiple choice questions.  Just saying . . . .


October 26, 2010 in Commentary | Permalink | Comments (0) | TrackBack (0)

Giving unconscionability some muscle

Book1 The doctrine of contract unconscionability was designed to be the contract law version of the Lone Ranger (left).  The Lone Ranger, you remember, used to ride about the country like a knight-errant, battling unfairness, injustice, and overreaching wherever he found them, even in situations where ordinary law enforcement was helpless.  Like the Lone Ranger, the doctrine of unconscionability was developed to help courts to battle unfairness, injustice, and overreaching in situations where ordinary contract doctrines (such as lack of consideration) were helpless.

Aaa Over the years, however, the doctrine has proved much less fierce than originally advertised.  In practice it has been less like Sir George going after the dragon than like Monty Python's Brave Sir Robin.  Even in the area of standard-form contracts, where we would suspect the greatest likelihood of overreaching, it has been the rare case when the doctrine has been successfully invoked.

Widener-Delaware's Stephen Friedman (right) would like to see the doctrine strengthened.  In a new paper, Giving Unconscionability More Muscle: Attorney’s Fees As a Remedy for Contractual Overreaching, forthcoming in theGeorgia Law Review, he has a suggestion that should be popular with lawyers who litigate on behalf of consumers.  Here's the abstract:

This Article seeks to broaden the conversation about unconscionability. While most of the discussion has focused on the appropriate standard for determining unconscionability, this Article focuses on the appropriate remedy to be imposed when unconscionability is found. The current remedy for unconscionability is non-enforcement or limited enforcement of unconscionable contracts or contract terms. This remedy is inadequate and seriously undermines unconscionability’s effectiveness as a tool for policing against contractual overreaching. The Article proposes that courts be given discretion to award attorney’s fees to consumers who successfully establish the unconscionability of a standard form contract. Such a remedy would enable unconscionability to meet the challenges posed by standard form contracts and would be fully consistent with unconscionability’s nature and history.


October 26, 2010 in Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Monday, October 25, 2010

Today in History -- October 26

A c. 899 – Alfred the Great,who fought the Vikings and created the first English legal code, dies of natural causes at Winchester.  His Doom Book quotes Leviticus: "You shall do no injustice in judgment!  You shall not be partial to the poor; nor defer to the great!  But you are to judge your neighbor fairly!"

1640 – King Charles I of England and Scotland signs the Treaty of Ripon with the Scots Covenanters, putting an end to the Second Bishops’ War but setting in train a series of events that will turn out very badly for him.

1774 – Having transmitted its list of colonial grievances to Parliament, the First Continental Congress adjourns in Philadelphia. Exactly one year later King George III will declare the colonies in rebellion.

1854 – Future cereal tycoon Charles William Post is born at Springfield, Illinois. His Postum Cereal Co. will eventually become General Foods.

1881 – Deputy U.S. Marshal Virgil Earp, along with his brothers Wyatt and Morgan and dentist John "Doc" Holliday, out-shoot five cowboys near the O.K. Corral in Tombstone, Arizona Territory. All three Earp brothers are wounded.

1883 – The father of the modern self-help movement, Napoleon Hill (Think and Grow Rich) is born in a one-room mountain cabin near Pound, Virginia.

1947 – Future Charlie’s Angel Jaclyn Smith and future Secretary of State Hillary Clinton are both born, in Houston and Chicago respectively.

1999 – After 700 years, the right of hereditary peers to vote in Parliament is revoked.


October 25, 2010 | Permalink | TrackBack (0)

Conference Announcement and Call for Papers: Annual Contracts Conference in Gulfport, Florida

LawLogoH_K Jaime Fox (Stetson) sends along this conference announcement and call for papers:

Palm-trees The Stetson University College of Law will host the 6th Annual International Conference on Contracts, February 18th and 19th, 2011, at Stetson’s beautiful campus in Gulfport, Florida.  Similar to prior contracts conferences held at UNLV, McGeorge, South Texas, Texas Wesleyan, and Gloucester, England, this conference is designed to afford scholars and teachers at all experience levels an opportunity to present and discuss recently-published papers, forthcoming papers, works-in-progress, and pedagogical innovations, and to network with colleagues from the U.S and around the globe. 

Call for Papers and Panels:  We invite paper, presentation, and panel proposals exploring any aspect of contract law, theory, and policy (full panel proposals, with topics and participants, are especially welcome).  The topic range is intentionally broad to allow for the fullest exploration of things contractual.  Past programs have included panels on “traditional” contracts topics (e.g. remedies, formation, and defenses) and on contract-related subjects (insurance, consumer law, commercial law, dispute resolution, family law, and restitution).  Papers have also included a variety of perspectives on law, from law-and-economics (behavioral and neo-classical), to international and comparative contracting, to historical, jurisprudential, empirical, institutional, and many other perspectives.  We also solicit volunteers to serve as moderators or discussants for panels that are not "packaged deals."  Proposals are due by December 15th.

The conference hotel will be the Tradewinds Resort in nearby St. Pete Beach.  A block of rooms is reserved for the conference, with rates starting at $159 (suites and other rooms are available for somewhat higher rate); just ask for the Stetson College of Law Contracts Conference when making your reservation.  The Tradewinds is a great location for families and the conference rate applies through the weekend if people want to stay and enjoy the Florida sun. The hotel phone number is 800-360-4016, and the webpage is

We are finalizing conference registration details and the web registration process, and will follow up shortly with the link to the conference webpage.  We expect the registration cost will be about $200.

All paper, panel, and presentation proposals should be sent to Jamie Fox by email at fox [at] law [dot] stetson [dot] edu or by land to Stetson University College of Law, 1401 Gulfport, FL 33707.

Hope to see you there!

[Meredith R. Miller]

October 25, 2010 in Conferences | Permalink | TrackBack (0)

A Streetcar Named "Perspire"

A Commuters in Adelaide, South Australia, are steaming.  The air conditioners in their trams aren't working, and the summer heat can be brutal.  Who's responsible?  That will be sorted out in court, where the company who built the air conditioning units on the trams is suing TransAdelaide, the municipal transit authority, for breach of contract

The plaintiff, MooreAir, claims that it was supposed to get a ten-year maintenance contract to service the air conditioning units on the Bombardier Flexity electric trams, but TransAdelaide decided to do it on its own even though it lacked the necessary skills and manuals.


October 25, 2010 in In the News | Permalink | Comments (0) | TrackBack (0)

BU to host conference on fiduciary duties

Bb Fiduciary duties are imposed by law, but their scope is defined by contract.  The border between duties assumed by agreement and those imposed by law can get fuzzy.  Few legal writers have spent more time exploring the concept of trust -- the basis for fiduciary duties -- than Boston University's Tamar Frankel (left).  BU will host a conference "inspired by" her work, "The Role of Fiduciary Law and Trust in the 21st Century."  It takes place this Friday (October 29, 2010).  Here's the description:

Fiduciary law is designed to encourage people to rely on experts and other fiduciaries, to facilitate fair and efficient terms of those relationships, and to prevent (and provide remedies for) abuse of power entrusted to the fiduciary.  This Conference highlights the nature and scope of fiduciary law, and its relationship to other legal doctrines and categories.  It considers how fiduciary law can be illuminated by viewing it through the lens of such disciplines as economics, psychology, history, political science, and philosophy.  It also investigates current debates about recognizing fiduciary duties in the determination of executive compensation, in the prohibition of insider trading under the federal securities laws, in the largely unregulated world of securities and mortgage broker-dealers, and in modern capital structure and governance.  It further explores the relevance of fiduciary law principles to the abuse of power by public officials and to other issues of democratic legitimacy, as well as the relevance of constraints on political power to the duties of private actors.

Panelists include Margaret Brinig (Notre Dame), Deborah DeMott (Duke), Alan Feld (Boston U.), Joshua Getzler (Oxford), Wendy Gordon (Boston U.), Richard Holton (MIT–Philosophy), Laurence Kotlikoff (Boston U.-Economics), Arthur Laby (Rutgers-Camden), Donald Langevoort (Georgetown), Ethan Leib (UC-Hastings), Donna Nagy (Indiana-Bloomington), Kevin Outterson (Boston U.), James Post (Boston U.-Management), Larry Ribstein (Illinois), David Seipp (Boston U.), Kenneth W. Simons, (Boston U.), Eric Sirri (Babson-Finance), Robert Sitkoff (Harvard), Frederick Tung (Boston U.), Cheryl Wade (St. John's), David Walker (Boston U.), and Charles Whitehead (Cornell).



October 25, 2010 in Conferences | Permalink | Comments (0) | TrackBack (0)

Entrepreneurship, Cuban edition

A The Cuban government is planning on cutting 500,000 employees from the government work force.  Given the lack of private enterprise jobs in Cuba, what are those people going to do?  Why, go into business for themselves, says President Raul Castro, so they can start paying taxes instead of consuming them. The government apparently has authorized nearly 200 sectors where it wants to encourage small business.  Would-be entrepreneurs can apply for licenses to go into fields like raising rabbits and becoming a clown,

But none of these new entrepreneurs should expect go get rich.  The system, says the government, will be designed to "avoid the concentration of wealth."  In an effort to stimulate job growth, the government has also stated that those who hire workers in their small businesses will be subject to higher taxation.


October 25, 2010 in In the News | Permalink | Comments (0) | TrackBack (0)

When you take The Man's money . . . .

. . . you dance to The Man's tune.  That's the grim lesson public universities are now learning, as state legislatures facing serious budget issues are trying to figure out exactly what taxpayers are getting for the money they spend on higher education.  The Wall Street Journal has a major story on the issue, excerpted over at TaxProf.  Some of the looming changes:

[P]erhaps the most far-reaching initiative is the cost-benefit balance sheet at Texas A&M, the oldest public university in the state. Each faculty member is assessed on criteria including the number of classes that they teach, the tuition that they bring in and research grants that they generate.

One metric divides their salary by the number of students that they teach. The range is striking. Some nontenured lecturers earn less than $100 for each student they instruct. Other professors are teaching such small classes that their compensation works out to more than $10,000—in a few cases, more than $20,000—per student.

Law professors are likely to do better than most on this metric, given the average size of law school classes.  But there's likely to be pressure on those highly paid scholars who teach relatively few students in arcane seminars.

The money quote is from a highly regarded history professor who has written a study of Pushkin's Boris Godunov.  "If you want me to explain why a grocery clerk in Texas should pay taxes for me to write those books," he says, "I can't give you an answer."

I suspect the trend will not stop at public universities.  Next up, of course, will be private universities that get public money, which is pretty much all of us.


October 25, 2010 | Permalink | TrackBack (0)

If you can't stand the Heat . . . .

A The NBA's Miami Heat this off-season added LeBron James to a roster that already included Dwayne Wade and Chris Bosh.  If you want an economist's explanation of why the team will not win a championship, Tyler Cowan at Marginal Revolution offers it here.  If you want the same opinion from someone who doesn't know anything about economics, Norman Chad of the Washington Post chimes in.  Both argue that having multiple superstars on a team is counerproductive because it confuses people about their roles.

Oddly, neither mentions the 1980s Ls Angeles Lakers, who won three titles with Hall of Famers Kareem Abdul-Jabbar, Magic Johnson, and James Worthy, or the same decade's Boston Celtics, who won three titles with HOFers Larry Bird, Robert Parish, and Kevin McHale.


October 25, 2010 in In the News | Permalink | TrackBack (0)

Sunday, October 24, 2010

Today in History -- October 25

1400 – The father of English literature, Geoffrey Chaucer dies of unknown causes at age 57.

A 1495 – The "Perfect Prince," John II of Portugal (right), dies at Alvor at age 40 after a 14-year reign. Inheriting a bankrupt kingdom, his encouragement of trade and exploration had made Portugal the financially strongest country in Europe by the time of his death.

1616 – On a voyage to Batavia (now Jakarta) for the Dutch East India Co., Captain Dirk Hartog goes off course runs into an unexpected shore—and discovers the western coast of Australia.

1828 – The St Katharine Docks—construction of which destroyed more than a thousand homes and made 11,000 people homeless—open in London. They turn out to be poorly designed.

1861 – Twenty-four men gather in a Masonic Hall in Toronto to create what will become the Toronto Stock Exchange, now the third-largest in North America.

1921 – Legendary gunfighter turned sportswriter Bat Masterson dies at his desk in the offices of the New York Telegraph.

1983 – U.S. and Caribbean troops invade Grenada six days after the assassination of its prime minister. Although the invasion will be widely condemned by the United Nations, Grenadians will later make the date a national holiday, called "Thanksgiving."

1992 – Seventy-five percent of Lithuanians vote to adopt a new post-Soviet democratic constitution.


October 24, 2010 in Today in History | Permalink | Comments (0) | TrackBack (0)

Weekly Top Ten--October 24, 2010

SSRN A Christopher Lewis Peterson (smiling at right) again tops our weekly Top Ten list. It’s been a pretty impressive couple of months for Peterson—his Two Faces paper (noted below) has in less than a month become the third most-downloaded contract-related paper in the history of SSRN, while another of his papers has now become the tenth most-downloaded on the all-time list. Peterson is the only scholar with two papers in the all-time top ten.

Following are the top ten most_downloaded papers from the SSRN Journal of Contract and Commercial Law for the sixty days ending October 24, 2010.  (Last week's rank in parentheses.)

1 (1)  Two Faces: Demystifying the Mortgage Electronic Registration System's Land Title Theory, Christopher Lewis Peterson (Utah).

2 (2)  Good Faith and Contract Interpretation: A Law and Economics Perspective, Simone M. Sepe (Arizona).

3 (8)  The Need for Insurance Policy Transparency, Daniel Schwarcz (Minnesota).

4 (3)  Regulating Systemic Risk, Steven L. Schwarcz (Duke) & Iman Anabtawi (UCLA).

5 (7)  Misbehavioral Economics: The Case Against Behavioral Antitrust, Joshua D. Wright (Geo. Mason) & Judd E. Stone (Int’l Ctr. for Law & Econ.).

6 (4)  Taking Punitive Damages Seriously: Why a French Court Did Not Recognize An American Decision Awarding Punitive Damages and Why it Should Have, François-Xavier Licari (Metz).

7 (6)  A Moral Rights Theory of the Private Law, Andrew S. Gold (DePaul).

8 (6)  Arbitration as Delegation, David Horton (Loyola-L.A.).

9 (10)  Comparing CEO Employment Contract Provisions: Differences between Australia and the U.S., Jennifer G. Hill (Sydney), Ronald W. Masulis (New South Wales_Business) & Randall S. Thomas (Vanderbilt).

10 (9) The Conundrum of Covered Bonds, Steven L. Schwarcz (Duke).


October 24, 2010 in Recent Scholarship | Permalink | Comments (0) | TrackBack (0)

Disclaiming warranties in the PRC

Over at China Law Blog, Dan Harris has an interesting discussion on trying to change default rules through standard-form contracts.  Not only does it not work so well, it actually can result in fines.


October 24, 2010 in Commentary | Permalink | Comments (0) | TrackBack (0)

Today in History -- October 24

1147 – Crusaders led by Afonso Henriquez, Count of Portugal, retake Lisbon from the Moors after a four-month siege.  Afonso will later be named the first King of Portugal.

1648 – The Peace of Westphalia is signed, marking the end of the Thirty Years' War and creating the basis for the modern relationships among nation-states..

1852 – Daniel Webster dies at age 70 at Marshfield, Massachusetts.

1855 – Future lawyer, businessman, and U.S. Vice President James Schoolcraft "Sunny Jim" Sherman is born at Utica, New York.

1908RandallCountyCourthouseCanyonTexas907TJnsn 1857 – Sheffield F.C., the world's first football (soccer) club, is founded, coincidentally enough, in Sheffield, England.

1861 – A consortium of companies led by Western Union completes the first transcontinental telegraph line across the United States. The Pony Express goes out of business two days later.

1901 – Sixty-three year-old Annie Edson Taylor – looking for a good way to pay for her upcoming retirement –becomes the first person to survive going over Niagara Falls in a barrel.

1917 – An armed Bolshevik uprising in Petrograd (now St. Petersburg) triggers the Great October Socialist Revolution in Russia.  The October date is "Old Style"; in the West the revolution will start on November 7. 

1929 – In what comes to be called "Black Thursday," the New York Stock Exchange plunges amid massive volume.  By the end of the following week the markets will be devastated.


October 24, 2010 in Today in History | Permalink | Comments (0) | TrackBack (0)