Monday, November 4, 2013
this story on NBC Affiliate WECT, a jury awarded over $50,000 to a student who sued his college for breach of contract. The damages reflect not only tuition and fees but also the student's opportunity costs. The student's argument was that the school was contractually obligated to screen applicants for criminal backgrounds that could prevent them from completing their coursework in medical fields which require that some coursework be done at hospitals.
The school did not screen the student until he had been enrolled in the program for 18 months. At that point, the student was dismissed from the school. He sought readmission but was denied. The school offered $25,000 in settlement but withdrew the offer during trial.
This is a rather surprising result. We wonder whence comes the contractual duty for the school to screen applicants for criminal backgrounds. One would think that the obligation would run the other way. That is, students ought to have a duty to disclose criminal backgrounds, because it is far cheaper and more effective to require such disclosure than it is for colleges to independently investigate each student. One would expect that the application form would have a section requesting such disclosure, but even if it does not, all it would take would be some sort of statement somewhere on a website or in a student bulletin describing the college's policies. If the college does have a duty to investigate, we wonder why the duty would run to the student rather than to some accrediting or professional body.
Finally, there is a the question of damages. Apparently, the student was awarded both a full tuition rebate and compensation for the income he forewent by pursuing his education. If it is indeed the case that the college had a contractual obligation to screen the student's criminal background and that contractual duty ran to the student, the jury award assumes that the college gave the student nothing of value because he could not enter his chosen field of study. There are two problems with this: 1) even in a professional school, the value of a degree exceeds its value as a means of entry into an occupation; and 2) even if the student had completed his education, he would not be guaranteed a position. There ought to be some sort of set-off from the jury award to account for the benefit that the college conveyed to the student. Otherwise, the case is a bit of a stick in the eye to educators.
Thursday, October 31, 2013
Upon reflection, Judge Traynor may have had it right when he wrote:
Words, however, do not have absolute and constant referents. "A word is a symbol of thought but has no arbitrary and fixed meaning like a symbol of algebra or chemistry, ..." * * * The meaning of particular words or groups of words varies with the "... verbal context and surrounding circumstances and purposes in view of the linguistic education and experience of their users and their hearers or readers (not excluding judges). ... A word has no meaning apart from these factors; much less does it have an objective meaning, one true meaning."
I say this because, today, I learned what "chicken" apparently means in one specific context in Suffolk County, New York. You don't suppose that this is was what Frigaliment and B.N.S. meant by "chicken"?
[Meredith R. Miller]
According to this scary report from National Public Radio, children are not entirely rational. Well, perhaps we should not overstate the conclusions one can draw based on the relevant research. Children are only boundedly rational when it comes to Halloween candy.
A psychologist at Dartmouth College discovered that children were happier when they got a candy bar than they were when they got a candy bar and a piece of gum. This research calls into question our earlier assumption that more is better.
And it turns out that, according ot the same NPR report, Halloween candy is not the only realm in which people's responses to experiences can defy our expectations. It turns out that, while colonoscopies are bad, colonoscopies in which a tube is left inserted in the patient for a while, causing additional discomfort, are . . . (if you guessed worse, you're getting colder), at least according to a survey of patients on what they thought of the experience.
The trick (or treat) is to save the best (or the least bad) for last. If y0u are handing out candy tonight, and you don't want to get your house egged back into the stone ages, give the children some prunes, and then as they reach for their mace, offer a candy bar. They will leave happy and nominate you for a Nobel Prize. Similarly, if you are going to perform an invasive procedure on someone, make sure you have something less bad with which to follow it up.
Wednesday, October 30, 2013
A contract dispute powers A Man of Property, the first volume of John Galsworthy's The Forsyte Saga, to its conclusion. Now, I admit, the synopsis that follows is not based on the novels, which I have not read. It is based on the 2002/2003 television mini-series. I will happily stand corrected if any Galsworthy fans want to point out discrepancies between the film and novel accounts of the contracts case.
Soames Forsyte loved his wife Irene, but he wanted to possess her, and she only consented to marry him. Difficulties arose when Irene took an interest in a young architect, Bosinney, who was to wed Soames's second cousin (I believe), June.
Soames, unaware at this point of the connection between Bosinney & Irene, decides to build a country home to get Irene away from the distractions of London -- in particular he means to separate her from June. Meanwhile, Bosinney and Irene become lovers, and at the same time, rather unwisely, Bosinney keeps raising the contract price for the home he builds for Soames.
Bosinney and Irene finally push Soames beyond all endurance, and he decides to sue Bosinney for breach of contract because Bosinney has exceeded the agreed-upon, adjusted contract price for the house. Bosinney is in a bad spot. He can't afford to pay Soames for the extra costs -- they approach Bosinney's annual income. Nor can he afford to have a breach of contract claim hanging over him in connection with his first major project. Indeed, based on the success of his first project, other well-bred Englishmen are beginning to approach him as potential clients, but when they learn of his dispute with Soames, all is put on hold.
From the outset, one senses that Soames has Bosinney cornered and will destroy him. Bosinney believes, rather absurdly, that he can win the case, but Soames is a solicitor and he can hire the best trial lawyer in London. Bosinney hasn't a chance. Perhaps it's all for the best then when he is run over by a carriage and killed just before the case is lost. Soames ends up selling the house to his Uncle. The sale price might give us a better sense of the extent of the legal injustice wrought in Forsyte v. Bosinney.
Monday, October 21, 2013
In case you didn't see it, Adam Liptak's Sidebar column in the New York Times takes aim at student-edited law reviews with such zingers as: "Law reviews are such a target-rich environment for ridicule that it is barely sporting to make fun of them." Liptak gets it mostly right in describing the dismal status quo, incluing the utter lack of relevance of most law review articles to the practicing bar. (I had a law professor who said the best way to keep a secret is in a law review article and I tend to think he was right).
I am shocked that this story is newsworthy and I don't necessarily agree with the prescription that "blind screening, peer review and more training for the student editors" would make all the difference. But I am most grateful that Liptak's column references a 1936 essay by Yale Professor Fred Rodell titled “Goodbye to Law Reviews.” It made my day. Check out the abstract:
It is doubtless of no concern to anyone that this is probably my last law review article. As a matter of fact, this makes one more article than I had originally planned to write. It was something in the nature of a New Year's resolution. Yet the request to do a piece about law reviews seemed a golden opportunity to make my future absence from the "Leading Articles, Authors" lists a bit more pointed than would the business of merely sitting in a comer, sucking my thumb, and muttering Boo. Keeping well in line with two traditions—a course which lawyers will readily understand—I decided to break the resolution and not wait for opportunity's second knock. This, then, is by way of explaining why I do not care to contribute further to the qualitatively moribund while quantitatively mushroom-like literature of the law.
There are two things wrong with almost all legal writing. One is its style. The other is its content. That, I think, about covers the ground. And though it is in the law reviews that the most highly regarded legal literature—and I by no means except those fancy rationalizations of legal action called judicial opinions—is regularly embalmed, it is in the law reviews that a pennyworth of content is most frequently concealed beneath a pound of so-called style. The average law review writer is peculiarly able to say nothing with an air of great importance. When I Used to read law reviews, I used constantly to be reminded of an elephant trying to swat a fly.
Just proves that there is nothing new to say.
[Meredith R. Miller]
Saturday's New York Times featured a story about a family that was nearly ruined by medical bills resulting from their infant daughter's emergency heart surgery. Although the hospital was in network, not all of the doctors who treated the infant were, and so the insurer passed on "balance payments" to the family for the difference between what out-of-network medical personnel charged and what insurance covered for such out-of-network medical personnel.
According to the story, the family was never informed that some of the people treating the child were out-of-network. Then they were billed thousands of dollars. Fortunately, the child's grandmother had the resources to fight the insurers every inch of the way and the story has a relatively happy ending. They were able to appeal some of the out-of-network charges, and then their insurance company agreed to kick in a bit more of a contribution and the out-of-network provider wrote off the rest. The family only ended up paying around $10,000.
That result is likely the result of a compromise that relied on the facts of the particular case, but it also seems like the right result under a theory of restitution. The family did not agree to have an out-of-network provider provide medical services for their daughter. When such services were provided, they were provided officiously to the extent that the medical provider sought compensation beyond what the family was willing to pay. They should not be required to pay in excess of that amount when nobody ever asked them if they would accept services out of network.
However, the facts of this case are relatively easy. The answer to the question of whether a family would accept out-of-network medical services necessary to save their infant daughter is almost certainly yes. But what follows from that. One could argue that whether or not there is actual consent to treatment by out-of-network providers in an emergency situation, recovery should be limited to in-network charges. Consent is not meaningful when given under conditions of such emotional duress. Or one could argue that, because a family would always consent if asked, the officious intermeddler argument above is specious. Families that want better coverage will have to pay for better insurance.
According to the Times, it is not clear that the Afffordable Care Act (ACA) addresses this problem. One expert says it doesn't and that the ACA could exacerbate the problem because networks may be smaller on many ACA plans. On the other hand, the Times reports that under the ACA, annual out-of-pocket expenses should not exceed $6,350 for individuals and $12,700 for a family of two or more in 2014.
The distinction between in-network and out-of-network is likely a historical accident in the United States. I would guess that it is unknown in many of the 45 countries whose health care systems are regarded as more efficient than that of the United States. Twenty-three of these countries have higher life expectancies than the U.S. Overall, in a 2000 study, the World Health Organization ranked the United States 38th overall in the quality of its healthcare system, despite the fact that the U.S. in #1 in per capita expenditures on health care.
Thursday, October 17, 2013
I have been periodically reporting in this space on my Law School's new curriculum, which features a new approach to contracts. We have broken each semester into two, seven-week minimesters, and the traditional four-credit, fourteen-week contracts course has been broken into two, two-credit, seven-week courses. As a result, I have just finished grading my students' final exams.
Here are some preliminary thoughts on the experiment thus far:
1. The frequent assessments that we did helped me to understand that students have difficulties with concepts that I had forgotten were difficult. I'm sure these concepts were difficult for me as well when I was a law student, but after teaching for ten years, they have become dangerously familiar. For example, I discovered that the distinction between "additional" and "different" terms in UCC 2-207 is not obvious to a lot of students. I never paused to consider that in past years, but we had a quiz on the battle of the forms, and many students preparing for the quiz asked me to explain it. Similarly, I learned this year that the phrase "within the statute of frauds" does not obviously and easily translate into "a type of contract that, in order to be enforceable, must be in a writing signed by the party to be charged."
2. I had some concerns going in that it would be difficult for students to prepare themselves for a law school exam just seven weeks into their first semester, and there were no doubt students for whom seven weeks was not enough time to digest all the material we covered in the first minimester. So, I am a bit concerned that some students will underperform on this exam because they are slower than the median at making the adjustment to the law school environment, and I suspect there are students who are slow at the start but nonetheless are capable of developing a profound understanding of the law. But see #4.
3. I also had concerns about our students' preparation for law school essay exams, but I actually found that this year's essays were not qualitatively different from those of past years, to the extent that comparison is possible. There was, as always, a tremendous range in students' approaches to writing the essays, but it was all within expected parameters.
4. The purpose of the minimester in contracts is to give students a meaningful assessment early on. This will give students a realistic sense of where they stand in relation to their peers. It will also help us to identify the students who need additional academic support, and it may even help us to identify what sort of academic support they need. Since all law students are above average, I expect that many of my students will be disappointed by the grades they receive in Contracts I. I hope that their response will not be to become discouraged but to re-double their efforts and get the support they need from our able academic support team.
5. In years past, when a student would perform dismally in contracts, there was not much I could do beyond handing tissues and hoping that the poor performance was a fluke. This year, because of the minimester system, I have a real opportunity to work with students to address difficulties before they become career-threatening. And if students perform consistently poorly in both Contracts I and Contracts II, I will feel much more confident not in showing students the door but in encouraging them to prepare themselves for the possibility that a career in the law may not be in the cards.
My students will get their first minimester grades at the end of the week. I expect that I will be very busy next week meeting with students who want to go over their exams and extract valuable lessons from the experience. Part II of this post will address the extent to which that expectation is met.
Monday, October 14, 2013
After posting earlier today on the privacy issues associated with Gmail for those of us whose work accounts are Gmail accounts, I learned that Google's general terms of service do not necessarily apply to institutional accounts.
Here's some language from the Google Apps for Education website:
Any data you put into Google Apps is yours, and it says just that in our contracts. Your information is safe from other organisations, even though it's all on the same servers. Apps’ powerful, easy-to-use tools help administrators manage things like users, documents and services, and keep track of usage and data via dashboards. And of course you fully own the data, not Google.
That's rather comforting, but then there is this:
I find this less comforting because of the word "inapropriately" and because US privacy law and FERPA may not be enough to address all of the privacy issues involved.
If anybody has knowledge or information about this, pelase feel free to chime in.
Nancy Kim (pictured) , author of the recent book Wrap Contracts: Foundations and Ramifications and contributing editor to the ContractsProf Blog (the official blog of the AALS Section on Contracts), has published an op-ed in the San Diego Union Tribune California's new "eraser" law.
Nancy's post clarifies what the bill accomplishes and what it doesn't and makes a succinct argument for the law's importnace.
You can read it here.
Nancy posted last week on this lawsuit that claimed that Google’s practice of scanning users' emails violated federal and state wiretapping laws. Nancy discusses the excellent opinion of Judge Lucy Koh (pictured) in the case.
I have a few observations, some of which take me beyond my areas of expertise. My university switched over to Gmail a couple years ago, so our work e-mail is now Gmail. I do not recall there being an option to opt-out of the switch over, so if Google eventually gets its way and is permitted to read its users e-mails:
- Can employees really be said to have consented to Gmail's terms of service?
- What is the status of confidential communications that are sent on our university accounts?
- Is it a breach of confidentiality if employee A uses a university Gmail account to discuss a confidential personnel decision with employee B?
- Is it a breach of confidentiality if a faculty member or staff member responds via a universityGmail account to a student complaint relating to sexual or race-based harrassment?
- Is attorney-client privilege defeated if a university staff member communicates with university counsel via a university Gmail account, since the parties have allegedly agreed that Google can read their communications?
- Can anyone claim a reasonable expectation of privacy in their electronic communications if they are held to have consented to sharing those communications with a third party?
- If Google's terms of service include a statement that Google may, if asked, share both data and the contents of your e-mails with federal or state law enforcement agencies, would that elminate any possible claims of constitutional violations in connection with NSA datamining?
As the last bullet point suggests, I am curious about the relationship between data-mining by internet service providers and data-mining by the U.S. government. It is hard to generalize about people's feelings about such matters, but my impression is that there is a large sector of the population that considers Edward Snowden a hero for having revealed massive invastions of privacy by the U.S. government. At least some of these same people respond with a shrug to revelations of Google's interpretation of its terms of service based on some version of the idea that "everyone knows" that Google's profit model is based on exploiting the personal information of its users.
I think it is equally true that, at least since the Bush Administration, "everyone knows" or should have known that the federal government has established a massive datamining operation whose purpose is to screen communications for evidence of terrorism or terrorism-related activities. Nonetheless, my impression is that there is more anti-NSA outrage than there is anti-Google outrage. This is (to me) counter-intuitive, since most people believe that combatting terrorism is an important national interest and that permitting Google to identify our habits of consumption is not. So, why aren't the levels of outrage reversed?
- People buy Google's argument that when we use Google we consent to all of its terms of service (but what of the people who send or receive e-mails to people with Gmail accounts?);
- NSA datamining is arguably a constitutional violation, while Google's reading our e-mails is arguably only a violation of a statute;
- The NSA doesn't market any useful products, but Google is awesome;
- Google, while powerful, cannot use personal information to mess with individual liberties in the ways that the NSA can
Friday, October 11, 2013
Since I favor national health insurance, I have a hard time understanding the passionate opposition to the Affordable Care Act (ACA). But as a contracts professor, I also have a hard time understanding the Congressional Republicans' negotiating position. What consideration are they offering in return for passing a funding measure? As I understand it, their positions have been variously:
- We won't pass a funding measure unless the President agrees to defund the ACA;
- We won't pass a funding measure unless the President agrees to postpone the launch of the ACA for one year; and
- We will give the President an additional six weeks to postpone the launch of the ACA or we will refuse to raise the debt ceiling.
These positions take the rhetorical form of concessions. The Congressional Republicans seem to be offering compromise positions to the administration. But they are not in fact concessions because (by analogy to contracts doctrine), they are seeking a modification of an agreement without offering any new consideration. Funding the government is one of Congress's constitutional duties. Shutting down the governement and throwing (or threatening to throw) the economy over a cliff because one party opposes one piece of legislation is a reckless and irresponsible derogation of that duty. Moreover, all of these concessions are merely delays. Many Congressional Republicans have made clear that they intend to continue their strategy of threats to harm the country unless the administration concedes seriatim to an agenda driven by the GOP's most conservative members.
It is not as if there are not issues on which Congressional Republicans could give some ground -- and some of these issues would not even be costly. Are they offering real concessions on assault weapons? On environmental protection? On increasing taxaction on the wealthy or doing something to address the growing gap between rich and poor in this country? Is there any significant legislative realm in which the congressaional republicans are willing to make real concessions in return for an agreement that the ACA will be changed in some way or postponed?
Until the Republicans come forward with some serious consideration offered in return for a compromise on the ACA, I would be disappointed if the Senate or the administration gave any ground, just as I generally would not counsel a client to make concessions in a business context without negotiating some meaningful new consideration (absent unforeseen material changes in circumstances that have not occurred here). Modifications without consideration make sense in a relational context in which the parties value their on-going ability to continue engaging in mutually beneficial transactions more than the anticipated profits from any single contract. But that is not how I would characterize the relationship between Republicans and Democrats. These two entities have adopted mutual enmity as their raisons d'être, and they've been thrown together because members of each group are purportedly committed to the common good.
Well, it's time to show some evidence of allegiance to that purpose.
Wednesday, October 9, 2013
I am very interested to see what the Law School Deans have to say on their new blog on legal education. This is a subject that interests us over at the ContractsProfs Blog as well. The Deans have already posted in praise of the ABA recommendation that the 20-hour/week limit on employment for full-time students be eliminated. I agree with the logic of the argument -- the ABA does not prohibit students from doing anything else (moot court competition, law review, student government, video games) more than twenty hours a week, so why should it prohibit employment?
Still, I think there is an answer. There may be students who can work more than 20 hours a week and still excel in law school, but I think they would be exceptional. For most students, law school is hard in ways that college is not. And they do not realize that coming in. They worked through college, so they think they can work their way through law school. But by the time they learn that law school presents new challenges, they have already done permanent damage to their transcripts. The 20-hour rule is profilactic, so it is bound to be overinclusive, but this is probably a situation where a bright-line rule makes sense.
It is true that students can spend time in non-remunerative activities to their heart's content but I think there is a difference. Students can tell both themselves and their professors, "I'm sorry; I don't have time to prepare for your class because I have a job." That excuse will not work as well with any other activity. And to the extent that students are putting in extra hours in activities like moot court competitions, law review, clinical work or pro-bono legal activities, those are all part of their legal educations.
The argument that students need to work to support themselves doesn't necessarily fly, since many of them are working in jobs that pay very little compared to the debt they are incurring. They are far better off getting the most out of their investment in legal education than they are earning pocket money. These sentiments open me up to the accusation of paternalism, and I cannot deny that the accusations score a palpable hit. But in an educational context in which much of the curriculum is required, and a good deal more of it is very strongly recommended, I think we crossed that line long ago in far more substantial ways.
One of the main things that I try to get across, especially to first-year students, is that this, meaning law school, is their job now. There may be personal crises and family emergencies that call out for our students' attention, but students have to negotiate those demands and the demands of law school just as they would those demands and the demands of the working world. The law school curriclum is not going to wait for them. If students are distracted when we go over the statute of frauds and the parol evidence rule, they should not expect to be able to catch up when we are covering remedies. There just won't be time.
It is fine with me if the ABA gets rid of the 20-hour rule, but if it did so, I would recommend that my own law school adopt its own 20-hour rule for our students, with the possibility of exemptions (perhaps issued by the Dean of Students) in special cases when we know the student can handle the demands of both work and school. If we are going to have paternalist rules, they should come from within the house rather than from our ABA Big Brother's house.
Monday, October 7, 2013
One of my students, Maison Haines (pictured) gave herself a practice exam by writing up a summary of the contracts issues in Disney's film, The Little Mermaid. Indeed, there is much of value to be learned from the exercise, some of which relates to defenses and so was beyond Maison's contracts education at this point. Still, I have used her essay as a point of departure for this post.
Maison summarizes the plot as follows:
Ariel, a hopeless romantic mermaid, defies her father by constantly going to the . She dreams of living on land and how wonderful it would be. . . . One night, she notices bright lights in the sky, so she once again wanders to the surface to investigate. She swims upon a ship with none other than Prince Eric aboard it. She notices the dapper prince right away because he is handsome and is playing the snarfflak [flute]. She falls in love immediately. . . . Meanwhile, the wicked witch Ursula is keeping a close eye on King Triton’s youngest daughter. Ursula is looking to get revenge on King Triton, and what better way than through his curious, love-struck daughter. Ursula proposes an offer to Ariel, which is really where our story begins.
The wicked witch offers to turn Ariel into a human for three days. Ursula tells Ariel about how she can be with her prince, fall in love, and live happily ever after. Ursula tells Ariel she can remain a human forever if she makes Eric fall in love with her. He has to prove his true love for her by kissing her before “the sun sets on the third day.” The only thing Ursula wants in payment is Ariel’s voice. . . . Next, Ariel signs on the dotted line, loses her voice to the sea witch, and makes her way to the surface of the water where she will live for the next three days.
Now, as it turns out, our blog is not the first blawg to consider the contractual issues in Disney's The Little Princess. Findlaw's Legal Grounds blog posted on the subject back in August and The Utter Meaninglessness of Everything (Meaninglessness) blog did so back in 2008. There is considerable overlap among the posts.
All noticed, for example that Ariel's contract with Ursula should have been voidable, because Ariel was an infant (under 18) when she signed it. Maison expressed outrage that the whole plot of the movie is now implausible to her because the infancy doctrine precludes most of it. Never fear! We don't actually know whether the infancy rule applies under the sea.
In addition, Ariel also has a strong argument that Ursula did not act in good faith. She interfers in various ways with Ariel's attempts to get Eric to kiss her, sending her eels to interrupt a kiss and ultimately seducing Eric herself with the help of Ariel's purloined voice and a bit of magic. Once again thought, it may be asking a bit too much to apply these concepts to the watery realms inhabited by the parties to this agreement. After all, can one really make a straight-faced claim that Ursula the Sea Witch did not perform her contract in good faith? She's a sea witch. If you want a fair deal, try Glinda.
Legal Grounds thinks the contract may be void for vagueness, as the key term "true love's kiss" is unclear. I'm not sure I buy that one, as the parties do not seem to be in any doubt. It's a Disney movie, after all, so the ingredients for true love's kiss are: prince, two-legs, pulse (functioning neurons optional).
Meaninglesness suggests that Ariel's father, King Triton, could have declared the contract void as contrary to public policy, which seems about right, except that I'm not entirely comfortable with empowering the executive with authority to avoid commercial contracts involving family members. I think, under the sea, an Article Trident judge ought to make that call.
But getting back to Maison's take on all this, she points out that, after Triton's failed attempt to avoid the contract by blowing it up with his Trident, the contract was effectively modified. Triton offers himself up in Ariel's place in Ursula's collection of unfortunate souls. His agreement with Ursula is made in consideration of Ursula's promise to free Ariel. But Ursula is now no mere sea witch, she is the ruler of the seas, and things don't look so great for Ariel and Eric. Fortunately, the happy couple is able to impale Ursula, disembowel her and then ride the stream of entrails into calmer and more familiar seas. Or that's how I remember it. I haven't watched the movie in a while.
The Hans Christian Anderson story on which the movie is based is similar but much, much stranger. In Anderson's version (memorialized in the statute above right), the sea witch is even more grotesque than in the movie, and here is what she offers the little mermaid:
I will mix you a potion. Drink it tomorrow morning before the sun rises, while you are sitting on the beach. Your tail will divide and shrink, until it becomes what human beings call 'pretty legs.' It will hurt; it will feel as if a sword were going through your body. All who see you will say that you are the most beautiful human child they have ever seen. You will walk more gracefully than any dancer; but every time your foot touches the ground it will feel as though you were walking on knives so sharp that your blood must flow. If you are willing to suffer all this, then I can help you.
Some deal! The little mermaid takes the deal because she is after an immortal soul. If she fails to make the prince so love her "that he forgets both his father and mother, because his every thought concerns only you, and he orders the priest to take his right hand and place it in yours, so that you become man and wife" (less ambiguity about the promise here!), she will immediately become foam on the ocean.
In Anderson's version, the little mermaid fails to fulfill her end of the bargain, as the prince falls in love with a beautiful princess. This time, it is the little mermaid's sisters (rather than her father) who offer up a modification of the contract with the sea witch. They trade their hair for a knife that the little mermaid is to use to kill the prince, but . . . ah, I don't want to spoil the ending for you.
Wednesday, October 2, 2013
I have posted before about my approach to review sessions, which I have summed up in a picture to the left. I have colleagues who ask students to come with questions and hold forth on whatever issues the students raise, but in my experience, the students cannot be relied upon to identify the "unknown unknowns" and they may be too shy or embarrassed to articulate the "known unknowns." I just deliver an outline of the course to my students while they frantically type.
But wait, why am I even talking about review sessions only seven weeks into the semester? Well, I am holding review sessions for my contracts students this week because we are teaching contracts this year in two, seven-week, two-credit units. My students have their exams for the first "minimester" next week.
As I explained back in 2009:
One of my main pedagogical goals, and I make no claim to originality here, is to get students to think of law school as being about much more than just learning a bunch of rules. Nobody would need a lawyer if they could simply use Google to find the answers to their legal questions. Rather, lawyers help solve complex problems that may well fall between clear legal rules or where several competing rules may apply. In order to persuade a court to apply the rules most favorable to their clients or to apply the rules in the most favorable ways, lawyers need persuasive tools beyond knowledge of the black-letter law.
We spend most of the semester working on those skills through broad-ranging and perhaps rambling discussions on the interaction of law and policy. If students are too fixated on learning rules, they can't fully engage in what I consider the more important part of the course. In any case, in lots of areas of contracts doctrine, the rules are far from fixed.
I remind my students throughout the semester that I will feed them some red meat at the end of the semester. I hope to thereby enable them to relax and partake of the joy-filled fun ride that is the law of contracts.
My approch to teaching has become more challenging to implement with the advent of the minimester and with more frequent assessments. We no longer have the luxury of relaxed conversations over the course of a 14-week semester during which students' understandings of legal doctrinces gestate and coalesce. Rather, every other week, they are tested on how well they are assimilating the doctrine.
From my perspective, I think my students are better prepared after the first seven-week minimester than they were at the half-way point of the semester in years past. But they are better prepared in the sense that we have focused more narrowly on basic doctrine and made sure that they are grasping that doctrine. What is lost are the free-flowing discussions of the consequences of legal doctrines that in my mind has always been the stuff of lawyering.
Hopefully we'll have more time to work on that stuff in the second minimester.
Tuesday, October 1, 2013
IF YOU ARE NOT UP-TO-DATE ON BREAKING BAD EPISODES,
READ NO FURTHER
Monday, September 30, 2013
My student, Sam Henderson (who blogs here), alerted me to this cartoon which references the Paradox of the Court, of which I was previously unaware. We have a summary here from Joshua J. Mark on the Ancient History Encyclopedia. Here are the basics:
The Sophist Protagoras (pictured at left with his homie, Democritus) offered to teach a young man, Euthalos (or Euathlus), to argue in court. Departing from the Sophists' custom of demanding pay for sharing their wisdom, Protagoras offered the lessons for free, allowing Euthalos to pay him once he won his first case. Protagoras taught Euthalos, but Euthalos escaped indebtedness by avoiding taking any cases. Protagoras got fed up and sued Euthalos for his fee, but Euthalos claimed that either way the case came out, he still would not have to pay. If the court found in Euthalos' favor, the original agreement was unenforceable, and if it found in Protagoras's favor, Euthalos still would not have to pay because he still would not have won a case.
Sam was curious how a modern court would rule, and I think there is no answer that is clearly correct, and that's why it's such a great paradox. I think a court could reach different conclusions depending on how it ruled on implied terms and Euthalos's good faith (or lack thereof). Leaving aside the possibility that Euthalos could hire a Sophist to represent him and avoid any possible debt, I have a few takes:
1. A court could find that the parties assumed that Euthalos would pursue a career in the law and that such a career would entail arguing in court. If that was a reasonable implied term, Euthalos might have accepted Protagoras's lessons in bad faith (if he never intended to argue a case) and should have to pay the value of the lessons either as a matter of contract or in quantum meruit.
2. But perhaps it is not reasonable to imply the term. Is it really the case that all who are trained in the law practice? Some data on industry custom would be useful here. We in the legal eduaction business have been saying for years that job placement data can be misleading because not all who attend law school do so in order to practice law. Moreover, it may be arguable that a student of even the great Protagoras may never win a case. And so, even if both parties expected that one day Euthalos would have to pay for the lessons, Protagoras was assuming some risk.
3. Or perhaps Euthalos did not act in bad faith. Perhaps he entered into the agreement expecting to have a fabulous career as an advocate. He had agreed to study with Protagoras in the hopes of overcoming a speech impediment, but he found that trying to speak with pebbles in his mouth (Protagoras's proposed cure) only triggered his gag reflex. As a result, after completing his studies with Protagoras, Euthalos felt that he had learned nothing of value and owed Protagoras nothing. Protagoras should have thought twice before making an offer that could take the form: "You'll win a case or you don't have to pay!" Protagoras should have taken some lessons from Pufferitus.
4. Or a court could find in Euthalos's favor by finding against him as the paradox suggests. The court could rule that Euthalos will owe Protagoras his fee as soon as Euthalos wins a case, and as he has not yet done so, Euthalos need pay nothing for now. Of course, all of this turns on what one means by "winning" a case. If Protagoras seeks only a declaration that the parties have a contract, he loses by winning. If Protagoras seeks money damages, he wins by losing.
Thursday, September 26, 2013
Breaking Bad, I just thought I would never again have anything to which I could look foward. I did just turn 50, so there is AARP membership and a colonoscopy, but I thought there would be nothing in my future that I would anticipate enjoying.
But then came this in today's New York Times. Vince Gilligan, the creator of Breaking Bad just sigend an agreement for a new show on CBS. The timing of the announcement speaks well of both Mr. Gilligan and CBS, capitalizing on the current fan feeding frenzy surrounding the end of the series. But the fact that CBS is belatedly pouncing on a Gilligan script originally offered to CBS ten years ago speaks less well of that party to the deal.
Mr. Gilligan has an exclusive deal with Sony Pictures Television, which negotiated for him an unsual deal in which CBS agreed up front to air 13 episodes of Mr. Gilligan's series, Battle Creek. There's a lot of money involved, but who cares? If Battle Creek is anything like Breaking Bad, I will forgive CBS for not airing a single show that I have wanted to watch in the last 25 years.
Or am I forgetting something? Has CBS had any good comedies or dramas in prime time?
Monday, September 23, 2013
In Sunday's New York Times Magazine, a reader posed the Wood v. Boynton dilemma for the Times "The Ethicist." Chuck Klosterman, as an ethical rather than a legal question. The context is a bit different because we are dealing with a garage sale rather than a jeweler, but still we have a seller who is unaware of the value of the object being sold. The reader's question is simple and straightforward: does a buyer who is aware of the value of the the thing being sold (a first-edition comic book worth $2000) have an ethical duty to tell the seller.
For those of us who have been around the Wood v. Boynton, Laidlaw v. Organ block, this is familiar territory. As a typical survey of students' responses to the cases indicates, it is a territory in which ethcial and legal duties do not coincide. One might think that there is an obvious injustice when a person with superior knowledge takes advantage of a seller who unwittingly sells something of great value. Wood v. Boynton comes out as it did precisely because the buyer did not know and had no reason to know that the stone at issue was an uncut diamond, as he had never seen one before. If he knowingly took advantage of the seller, that would be grounds for rescision.
This result in Wood is not so surprising. Normally, a seller is in a better position to know the value of the thing she possesses than is the buyer, unless the buyer is an expert appraiser, and it makes sense to put the burden of discovery on the person better positioned to discover the item's worth. One might think that a professional jeweler would be an expert appraiser, but in this case he wasn't. I think it is reasonable for the law to place the burden on the seller at a garage sale to know the value of the things she sells. People come to these things in search of surprises and bargains, so it stands to reason that, from a legal perspective, all sales are final. Laidlaw v. Organ is similar and brings home the important point that sometimes we want to reward people for having taken the trouble to inform themselves of market conditions and spot a bargain.
But the ethical perspective on these matters is potentially quite different. It may be a common practice for people to pounce on garage sales in search of items significantly undervalued by the sellers, but that doesn't mean that it is an ethical practice. The reader poses the hypothetical as taking place at a garage sale or a flea market. I think the cases are different, because I do think a proprietor at a flea market (if, for example, she has a regular stall and or sells items regularly) can be charged with a duty to research the value of the items she sells. Still, fleecing even merchants is not what I would call an ethical practice.
I once unloaded about 200 books in advance of a move from Charleston, South Carolina to New York City. A bookdealer came by to look at the books and kindly informed me that one of the books I was offering for sale was a first edition, likely worth fifty times as much as I was asking for it. Perhaps he was not much of a businessman, but he did the right thing in telling me. I later donated the book for a silent auction, which seemed a good way out of my ethical dilemma since I had unwittingly bought the book at a huge discount from some equally unwitting (and long forgotten) seller.
I realize that the ethical standard I am proposing here is exacting, and Chuck Klosterman doesn't disagree in cases where an aggressive buyer initiates a sale from an unknowledgeble seller. But what is irksome about his column is that he pretends that the word "value" has no conventional meaning.
There is no “true value” for any object: it’s always a construct, provisionally defined by a capricious market and the locality of the transaction.
Well, thanks for the theoretical discourse, but that's all quite beside the point in this context. The value of a thing is easily determinable if there is any market for it. If two people are interested in buying it, then it is worth at least what the person who made the second highest bid for it is willing to pay. When a reader says that a comic book is worth thousands of dollars, that is because there is an existing, stable market in which the comic can be sold for thousands of dollars. Klosterman follows up with a silly hypothetical about a buyer who is willing to pay far in excess of a given price because an item has sentimental value to the buyer. There is no ethical obligation on the part of the buyer to disclose the extent to which she values the item, but even if there were, it would make no difference. The buyer could pull out $2000 to buy the item and remark to the seller, "I would have paid $5000 for this item, I want it so badly." The seller could refuse to sell at $2000, mark the item up to $5000 and risk going home with no money at all, because there is only one person willing to buy the item at that price and that person has just been alienated by grasping sales tactics.
But if the marked price of an item is 25 cents and the market values it at $2000, there will be plenty of buyers, and the seller really is wronged if someone who knows of the item's true worth does not disclose that fact. And such disclosure may not in the end preclude the transaction. You can approach a seller at a garage sale and say, "You know, this comic book is a first edition worth much, much more than you are selling it for." I think that, in most instances, the seller will say, "Well, that's a good find for you. I've marked it 25 cents, so you can have it for 25 cents. I wouldn't know where to sell it for more anyway."
Thus commerce proceeds without unnecessary soul-soiling.
Thursday, September 19, 2013
Monday, September 16, 2013
The Ninth Circuit's opinion in Murphy v. DirecTV starts in the manner to which we have been accustomed in the past few years. Although Plaintiffs state claims under California consumer protection statutes, and although another California statute declares unenforceable arbitration clauses in consumer contracts that preclude collective or class action proceedings, the Ninth Circuit must uphold DirecTV's arbitration agreement with the plaintiff class and compel arbitration. The Supreme Court's 2011 decision in Concepcion compels this result.
The arbitration provision with its class action waiver also contained a "jettison clause," which reads: “If, however, the law of your state would find this agreement to dispense with class arbitration procedures unenforceable, then this entire [section on dispute resolution] is unenforceable.” Originally, the Distirct Court relied on the jettison clause in denyingDirecTV's motion to compel arbitration, and the Ninth Circuit affirmed. Post-Concepcion, however, the District Court reversed itself and granted the motion to compel and the Ninth Circuit affirmed that grant of the motion to compel.
This confuses me, and I must confess that I do not find the Ninth Circuit's explanation enlightening, despite several pages devoted to distinguishing cases that Plaintiffs thought supported their claim. The Ninth Circuit treats the issue of one of retroactivity. When the Supreme Court interpreted in Federal Arbitration Act (FAA) in Concepcion, it told us what the FAA meant, and it has always meant what it meant in Concepcion. If the FAA preempts state law, then it has always done so, and it can do so with respect to claims that arose before Concepcion was decided. As the Court explains.
A contract cannot be unenforceable under state law if federal law requires its enforcement, because federal law is “the supreme Law of the Land . . . , any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.” U.S. Const. art. VI, cl. 2. Section 9 of the Customer Agreement provides only that the arbitration agreement will be unenforceable if the “law of your state” disallows class waivers, which California law does not—and could not—under the FAA as interpreted in Concepcion.
But the Ninth Circuit also quotes the Supreme Court as saying that the FAA “places arbitration agreements on an equal footing with other contracts, and requires courts to enforce them according to their terms.” Here, the parties have stipulated that their agreement to arbitrate is unenforceable if state law would prohibit it, and there seems to be no doubt that the law of California at the time of the contract prohibited class action waivers in arbitration provisions. If the courts are aiming at giving effect to the intent of the parties, it seems to me that the "jettison clause," rather than Concepcion governs. The FAA is about enforcing arbitration agreements, and here the parties have agreed that, to the extent California law governs, claims cannot be arbitrated. Concepcion should not be construed so broadly as to compel arbitrations to which the parties have not agreed.
But fortunately for Plaintiffs, they also have claims against Best Buy, where they acquired their DirecTV equipment and which is neither a party to the arbitration clause nor a third-party beneficiary of it, according to the Ninth Circuit. The nature of that acquisition is at the heart of Plaintiffs' claims. They allege that Best Buy misled them into thinking that they were purchasing DirecTV equipment when in fact the two companies consider the transaction a lease. Plaintiffs also allege that the lease terms are oppressive and unfair.
The District Court granted Best Buy's motion to compel arbitration based on equitable estoppel. Plaintiffs are suing alleging that the two parties colluded in imposing on them unfair and oppressive terms in a Customer Agreement and Lease Addendum. If it is suing based on that document, the arbitration provision should be in with respect to both defendants. The District Court held that Plaintiffs were estopped to deny Best Buy the benefits of the arbitration provision.
The Ninth Circuit reversed on estoppel. Plaintiffs are suing DirecTV because of unfair and oppressive terms in a lease agreement. They are suing Best Buy because its conduct in the transaction misled Plaintiffs into thinking they were buying equipment when they were in fact only leasing it. In short, the Ninth Circuit concludes that "Plaintiffs’ claims against Best Buy do not rely on, and are not intertwined with, the substance of the DirecTV Customer Agreement or Lease Addendum." In addition, while alleged collusion is another ground for equitable estoppel, and Pliantiffs have alleged collusion, the alleged collusion is unrelated to the contract on which Best Buy would rely in order to compel arbitration.
The Ninth Circuit also rejected Best Buy's claims that it was entitled to benefit from the arbitration provision either under an agency theory or as a third-party beneficiary.