Wednesday, December 2, 2015
I have been looking forward to the resumption of my posts on ContractsProf blog, but sometimes events overtake us. It is with the greatest regret that I report that our colleague Louis F. Del Duca, Professor Emeritus at Penn State Law, died suddenly on 30 November 2015. An announcement from his law school is available here.
Lou was one of my co-authors on Global Issues in Contract Law (“GICL”), and a beloved friend and colleague for all of us. He was the longest-serving faculty member in the history of Penn State – Dickinson Law, and an internationally recognized scholar in commercial and comparative law. His influence in the “internationalization” of American legal education was profound. His inspiration on the development of West Academic’s Global Issues series was palpable.
At the time of his passing, Lou, I and our coauthors were finishing up the preparation of the GICL second edition. We all feel fortunate to have had this one last interaction with Lou, and I look on GICL second as a small remembrance of our friend and colleague. Godspeed Lou!
Tuesday, December 1, 2015
Changes are underway at the ContractsProf Blog, and I am delighted to be one of them. Thanks to Myanna Dellinger for giving me the opportunity to join a team building on over a decade of quality content established by our founder (and my faculty colleague) Frank Snyder, outgoing editor Jeremy Telman, and many others throughout the years.
Who is this guy, anyway? Glad you asked. I am an Associate Professor of Law at Texas A&M University School of Law in Fort Worth, proud home for two years of the esteemed International Conference of Contracts that, as Jeremy mentioned here, has been closely associated with this blog since its inception. My major scholarly interests are in contracts (seriously, did you think I would NOT say "contracts" here?), commercial law (especially payment systems), and the interaction of both fields with legal skills and practice. I came to the academy after eight years of practice in the areas of business and commercial litigation and related transactions. Despite some occasional flirtations with theory, I have yet to shake off my greater interest in how lawyers actually make things work. So I've learned to live with that, and I'm most fortunate to be at a law school with colleagues and an administration who support the grab-bag of things I do.
My current work, which I hope to discuss here occasionally (while skillfully avoiding off-putting narcissism in the process), involves the intersection of private contract law with public regulation in the rapidly developing area of emerging payment systems. Where exactly are the best dividing lines between private and public law, especially in an age where the lag between technology and law seriously strains the institutional capacity of legal systems? Perhaps we can find some answers to that overarching question and have some fun along the way. I should, in the interest of full disclosure, confess that I think contract law is fun.
I look forward to the adventure, and I appreciate anyone who is along for the ride.
Thursday, November 5, 2015
Bumping this back up to the top:
Here are the basics:
11th International Conference on Contracts (KCON XI)
Feb. 26 and 27, 2016
St. Mary’s University School of Law
San Antonio, Texas
The St. Mary’s University School of Law is pleased to host the International Conference on Contracts — a two-day conference designed to afford contracts scholars and teachers at all experience levels (including those preparing to enter the academy and those whose primary teaching appointment is not in a law school) an opportunity to present/demonstrate and discuss (formally and informally) recently-published and accepted-but-not-yet-published scholarship, works-in-progress, thought experiments, as-yet-fully-formed ideas for scholarship, and pedagogical innovations and to network with colleagues — and potential collaborators or mentors — from around the country and other parts of the world.
This year, we will be honoring Professor Peter Linzer of the University of Houston Law Center (pictured) with the Lifetime Achievement Award for his contributions to the field of contract law.
Call for Papers
Submissions are cordially invited for the 11th Annual International Conference on Contracts, the largest annual scholarly and educational conference devoted to Contracts and related areas of commercial law. Papers and works in progress are welcome from those who study contracts from any perspective, whether doctrinal, pedagogical, theoretical, empirical, historical, economic, critical, comparative or interdisciplinary.
Works that take an international or civil law approach are also welcome. Junior scholars are particularly encouraged to participate. Those interested in proposing and organizing panels of three to five presenters on specific themes are especially encouraged to do so.
Individual submissions should be made by a brief abstract (one page is sufficient) of the paper or work in progress that includes contact information for the author(s). Individual submissions will be placed on panels with like submissions. Panel proposals should include the name and contact information of the moderator or organizer, and a summary of the proposed papers or works in progress. There is no publication commitment for the conference, but organizers of individual panels are free to arrange for publication on their own.
Submissions: The deadline is Monday, Dec. 11, 2015. Proposals submitted earlier will be accepted on a rolling basis. Proposals submitted after the deadline will be accepted on a space-available basis.
Submissions should be directed to:
Professor Colin P. Marks
The conference program will begin both Friday and Saturday mornings at 9 a.m. Breakfast and conversational opportunities will start earlier. The conference will continue until about 5:30 p.m. each day.
The Menger Hotel in downtown San Antonio is holding a block of rooms from the nights of Thursday, Feb. 25, 2016 through Saturday, Feb. 27, 2016 at a rate of $139 per night (plus tax) for a single or double occupancy room or $149 per night (plus tax) for a triple or quadruple occupancy room.
The deadline for hotel registration at the conference rate is Feb. 5, 2016. The sooner you book the more likely we will be able to get the hotel to make the conference rate available to additional attendees once the initial block is booked and the deadline passes.
Though shuttles will be provided to and from the conference and hotel, should you wish to drive, parking rates for the group are: $20 valet plus tax, (subject to change/for Hotel guest only). There are also various city lots around the hotel which cost between $12 and $20 per day.
We’ll provide transportation between the Menger and the law school for the conference as well as forFriday’s dinner venue at the Plaza Club in downtown San Antonio. Attendees who prefer to stay elsewhere are responsible for their own transportation.
Your registration fee will cover the costs of breakfast and lunches both days and a reception and dinnerFriday evening, as well as morning and afternoon refreshments during breaks, which will include coffee, fruit, baked goods and other items.
Tuesday, October 13, 2015
Congratulations to Cardozo Law's Mitchell Engler (pictured) on the publication of his Pay for Play: The Compensated Leisure Flow of Contract Damages, available for download here on SSRN. The article is published in the George Mason Law Review. Here is the abstract:
Contract damages aim to leave the injured party in as good a position as if the contract had been fulfilled. But discharged laborers often obtain a much better result due to the lack of a reduction for their excused work effort on breach. After first exposing the problematic ramifications of this unjustified deviation, this Article then provides two workable corrections.
Legal neglect of the labor/leisure tradeoff primarily explains the defect. Under this economic principle, workers must sacrifice valuable leisure to get paid. Contract law, however, can provide discharged workers compensated leisure: full payment despite retention of their leisure time after the breach. Interestingly, legal disregard of the leisure tradeoff also permeates the current firestorm over the value of a law degree. Evidencing a pattern of leisure time neglect, legal analyses similarly overstate service contract damages and the value of a law degree.
Practicalities also play a role as recognition of the flaw does not itself yield a ready solution. Current law’s mitigation offset for new work might seem to be the most feasible response. But mitigation does not apply if the new work is insufficiently comparable or if the worker could handle both jobs under the lost volume doctrine. Given mitigation’s limited scope, I demonstrate a superior offset. In theory, the contract price should be reduced by the worker’s lowest acceptable price for the job. With such reduction, the worker would receive just his real benefit, limited to the “surplus” value of the deal. I propose a novel way to estimate this proper offset: a sliding scale percentage reduction keyed to probability findings on job comparability or lost volume capacity. Labor elasticity studies provide another innovative way to estimate the offset as such studies calibrate the impact of wage changes on hourly work choices. Either approach would enhance the law’s coherence, fairness, and efficiency.
Friday, September 25, 2015
Yonathan Arbel has a post over on the New Private Law blog about the publication of the 2d edition of Charles Fried's classic Contract as Promise.
The post also includes a video of a panel discussion on the publication, which is embedded below.
Thursday, September 17, 2015
Omri Ben-Shahar (left) and Lior Strahilevitz (right) are hosting a conference October 16 & 17 at the University of Chicago Law School. The conference is sponsored by the Coase-Sandor Institute for Law and Economics.. The flyer is here.
Confirmed participants include:
Alessandro Acquisti, Carnegie Mellon University
Kristen Anderson, Federal Trade Commission
Ian Ayres, Yale University
Oren Bar-Gill, Harvard University
Omri Ben-Shahar, University of Chicago
Jaspreet Bhatia, Carnegie Mellon University
Richard Brooks, Columbia University
Aaron Burstein, Federal Trade Commission
Adam Chilton, University of Chicago
Ariel Feldman, University of Chicago
Sebastien Gay, University of Chicago
Matthew Kugler, U.S. Court of Appeals, 7th Circuit
Florencia Marotta-Wrugler, New York University
Kirsten Martin George, Washington University
Randy Picker, University of Chicago
Joel Reidenberg, Fordham University
Paul Schwartz, University of California, Berkeley
Lior Strahilevitz, University of Chicago
Friday, September 4, 2015
I just noticed that Martha Ertman (pictured) will be a guest blogger at The Faculty Lounge. As the introductory post notes,
Her new book is Love’s Promises: How Formal & Informal Contracts Shape All Kinds of Families. More broadly, she rights about the role of contracts in intimate relationships. Here full cv is here.
We look forward to seeking lots of great posts on contracts law in the Lounge.
Wednesday, September 2, 2015
Last year, Hastings Law hosted a conference in honor of Charles L. Knapp. The proceedings of that conference are now in print. Abstracts can be found here on the Hastings Law Journal homepage.
Contract Law Present and Future: A Symposium to Honor Professor Charles L. Knapp on Fifty Years of Teaching Law
Harry G. Prince
Volume 66, Issue 4, 871-878
Carol L. Chomsky
Volume 66, Issue 4, 879-898
Under the Sun: Casebooks and the Future of Contracts Teaching
Thomas W. Joo
Volume 66, Issue 4, 899-914
William J. Woodward, Jr.
Volume 66, Issue 4, 915-936
The Duty of Good Faith: A Perspective on Contemporary Contract Law
Jay M. Feinman
Volume 66, Issue 4, 937-950
Sketches of a Redemptive Theory of Contract Law
Emily M.S. Houh
Volume 66, Issue 4, 951-970
Contract as Evil
Volume 66, Issue 4, 971-1010
Curing the Infirmities of the Unconscionability Doctrine
Hazel Glenn Beh
Volume 66, Issue 4, 1011-1046
Volume 66, Issue 4, 1047-1082
Is There a “Duty to Read”?
Charles L. Knapp
Volume 66, Issue 4, 1083-1112
Monday, August 10, 2015
We shared with our readers Professor Robin Kar's views on the case a while back.
You can find Professor Kar's latest here.
Tuesday, August 4, 2015
A new Los Angeles Times investigation has revealed that nine out of ten students drop out of unaccredited law schools in California. Of the few students that graduate, only one in five ultimately become a lawyer. In other words, a mere 2% of the people that initially enroll in an unaccredited law school end up being attorneys. Shameful at best. One example of one person who did not make it as an attorney is former Los Angeles mayor Antonio Villaraigosa who went to “People’s College of Law” and took the bar four times, but never passed.
Unaccredited law schools are said to flourish in California. The state is one of only three in the nation that allow students from unaccredited law schools to take the bar test (the others are Alaska and Tennessee). Unaccredited schools in California are held to very few academic standards by regulatory bodies and, by their very nature, none by accrediting agencies.
Most of the unaccredited law schools are owned by small corporations or even private individuals. One, for example, is owned by a“Larry H. Layton, who opened his school in a … strip mall above a now-shuttered Mexican restaurant. He thought the Larry H. Layton School of Law, which charges about $15,000 a year, would grow quickly. But according to the state bar records, he has had six students since 2010.”
Experts again say that action must be taken. For example, Robert Fellmeth, the Price Professor of Public Interest Law at the University of San Diego School of Law, has stated that unaccredited schools “aren't even diploma mills, they are failure factories. They're selling false hope to people who are willing to put everything out there for a chance to be a lawyer."
As before, the problem goes beyond unaccredited law schools. Several ABA accredited law schools also demonstrate both poor employment and bar passage statistics, although the problem seems to be the most severe when it comes to unaccredited schools.
This story is not new to your or many others. However, it serves as a reminder of the continued importance of both insiders and outsiders taking a renewed look at regulations for (and broader expectations of) law schools in California and beyond. As always, purchasers of anything including educational “services” (which, as the above other and many other studies show, can all too easily turn out to be disservices) should be on the lookout for what they buy. A great deal of naivety by new students seems to be contributing to the problem. However, that does not justify the tactics and perhaps even the existence of some of these educational providers. Having said that, I also – again – cannot help ask myself what in the world some of these students are thinking in believing that they can beat such harsh odds. Hope springs eternal, it seems, when it comes to wanting to become a California attorney.
Thursday, July 23, 2015
You cannot say that we are boring you this week. Our blogs have included considerations on advertising on porn sites and having one’s illicit affairs forgotten contractually. Add to that the news that this week, Roman Catholic nuns, the archdiocese of Los Angeles, the formerly Jesuit student turned California Governor Brown and Pope Francis all had something to say about contracting about major and, admittedly, some minor issues.
To start with the important: Pope Francis famously issued his Encyclical Letter Laudato Si’ “On Care for our Common Home.” In it, he critiques “cap and trade agreements,” which by some are considered to be a mere euphemism for contractual permits to pollute and not the required ultimate solution to CO2 emissions. In the Pope’s opinion, “The strategy of buying and selling carbon credits can lead to a new form of speculation which would not help reduce the emission of polluting gases worldwide. This system seems to provide a quick and easy solution under the guise of a certain commitment to the environment, but in no way does it allow for the radical change which present circumstances require. Rather, it may simply become a ploy which permits maintaining the excessive consumption of some countries and sectors.” Well said.
Governor Brown, however, disagrees: Brown shrugged off Francis' comments. "There's a lot of different ways," he told reporters, "that cap and trade can be part of a very imaginative and aggressive program." Brown, however, does agree with the Pope that we are “dealing with the biggest threat of our time. If you discount nuclear annihilation, this is the next one. If we don’t annihilate ourselves with nuclear bombs then it's climate change. It’s a big deal and he’s on it.”
In less significant contractual news, Roar, Firework, and I Kissed a Girl and I Liked It singer Katy Perry is interested in buying a convent owned by two Sisters of the Most Holy and Immaculate Heart of the Blessed Virgin. Why? Take a look at these pictures. The only problem is who actually has the right to sell the convent to begin with: the Sisters or the archdiocese. When two of the sisters found out the identity of the potential buyer (Perry), they became uninterested in selling to her because of her “public image.” They now prefer selling to a local restaurateur whereas the archdiocese prefers to complete the sale to Perry, although she bid less ($14.5 million) on the property than the restaurateur ($15.5 million). Perry may be about to learn that image is indeed everything in California, even when it comes to the Divine. Perry is no stranger to religion herself as she was, ironically, raised in a Christian home by two pastor parents.
Thursday, July 16, 2015
Contracts Prof Kermit Mawakana (pictured) has sued the University of District Columbia (UDC) for breach of contract and employment discrimination in connection with his termination from UDC's David A. Clarke School of Law. Last week, the District Court for the District of Columbia issued an opinion in the case. On UDC's motion to dismiss the contract claim, the court found that UDC had breached no express contract but may have breached an implied contract, and it denied the motion.
According to the court, Professor Mawakana was hired in 2006 as an Assistant Professor and promoted to Associate Professor three years later. However when he came up for tenure, his application was denied because he had not met UDC's criteria for scholarship. Professor Mawakana alleged defects in his review process that amounted to a breach of contract. The court found that the review policies did not amount to a contract and thus found no breach of an express contract, but it did find that the complaint alleged sufficient facts "if just barely" for the claim for breach of an implied contract to proceed. The court similarly found that plaintiff had alleged sufficient facts to allow his claim for breach of the implied covenant of good faith and fair dealing to proceed.
The court did not rule on Professor Mawakana's non-contractual claims.
Monday, July 6, 2015
From the Southern University Law Center's Christopher Odinet (pictured) and newly published in the Banking Law Journal:
Payday Lenders, Vehicle Title Loans, and Small-Value Financing: The CFPB's Proposal to Regulate the Fringe Economy
You can find the article on SSRN here, where you can also find this abstract:
The market for payday lenders, businesses that provide vehicle title loans, and other small-value financing players is rife with controversy. Some see them as predatory lenders that weave a web of never-ending debt designed to capture the weakest and most economically vulnerable of society. However, advocates of these financial institutions argue that for many Americans who are otherwise shut out of the conventional lending market, these players provide the only viable source of credit in times of economic hardship. Whatever the view, these businesses, their borrowers, and the credit markets that they together comprise are often referred to in legal and economic research and literature as the "fringe economy." And interestingly, aside from a patchwork of state law rules, this area of the financial services sector is fairly unregulated.
However, on Thursday, March 26, 2015 the U.S. Consumer Financial Protection Bureau released a report outlining the agency's long heralded plans to impose nation-wide regulations on the fringe economy. The first part of this article gives an overview of the fringe economy, the types of services and products it provides, and gives a snapshot of existing, state-based regulations. The second part goes into the nuts and bolts of the proposed rules.
Monday, June 22, 2015
Here is the abstract:
This essay is a reflection on the gap between the real-life practice of contract law and some of the academic theory that tries to explain it. I define “lexical opportunism” as an adversary’s clever lawyering, using contractual text of a complex business arrangement, ironically as devoid of thoughtful drafting or close negotiation as the boilerplate in a consumer contract, but which, when turned into a legal theory, creates a potential for staggering liability beyond all common sense. A multi-billion lawsuit, recently settled, serves as an example, and triggers my discussion of (a) what it means to engage in theoretical assessment in contract law, (b) how the justification of contract law by way of inhibiting economic opportunism is based on the simplest examples, rather than the kind of contract discourse found in any real-world contract worth spending millions to litigate, and (c) how normative theory based on upholding the moral sanctity of promise keeping evaporates when the parties disagree about the meaning of their promises. I argue that both economic and moral theories about contract law fail to account for issues in the use of language and depend on the naïve adoption of the correspondence theory of truth. The nature of language permits opportunism, and the only check on it is the desire, from whatever motivation, not to be opportunistic. I conclude with what I hope are some constructive thoughts about the appropriate use of theory in lawyering, and thereby mitigate my skepticism whether any single theory or discipline is capable of meaningful explanation or prediction about lexical opportunism.
Monday, May 25, 2015
Law School Interactive, which provides podcasts for various purposes relating to law school, has a new podcast up featuring Frank Snyder (pictured left), the Zeus from whose head this blog sprung, and two friends of the blog, Brian Bix and Steven Schooner. It's always interesting to hear how colleagues introduce the topic of contracts law to prospective students. You can find the podcast here.
Law School Interactive summarizes the podcast as follows (slightly edited):
Frank Snyder starts his comments by defining contract law and explaining it as an unusual part of the legal system, and speaks of its practical aspects and the importance of being attuned to the client’s needs. Professor Snyder finishes his comments by likening the practice of contract law to business advising. He mentions that those who are good business advisers will likely enjoy and do well with contract law. He also advises students to investigate all areas of legal practice that they are interested in to find the one they would like to specialize in.
Steven Schooner [right] explains that contract law is a very different law practice than the more common practice areas of criminal, tort, or defense law. He underscores the fact that there seems to be no gray areas when it comes to students and contract law: Students either consider the field fascinating, or they don’t. He says that if you find business and bargains interesting, contract law might be the practice for you—and a love of math and numbers helps too.
Our final guest, Brian Bix [left], talks about contract law’s connection with many other specialties. Although undergraduate courses will not teach you much about the intricacies of contract law, Professor Bix tells budding law school student not to worry—law school will definitely give you the tools you need to succeed in the field. He ends his advice by saying that to be successful in this practice of law, face-to-face interaction and conversational skill are definitely a necessity.
Monday, May 18, 2015
Larry Cunningham of George Washington Law School (pictured) is preparing the second edition of his book, Contracts in the Real World. You may remember the first edition from prior posts such as the online symposium that we cross-posted here in 2012.
Larry is turning to the market to get ideas for the next edition. Via his twitter feed, he is now offering a copy of Contracts in the Real World to those who suggest a story that is chosen for inclusion in the next edition. More details on the book are at Cambridge University's webpage.
Monday, April 27, 2015
If it were up to General Motors, it may soon be illegal for you to tinker with your own car. That’s because the Digital Millennium Copyright Act (“DMCA”), an Act that started as anti-piracy legislation about a decade ago, now also protects coding and software in a range of products more broadly. Your car is one such product if it, as many cars do nowadays, it has an onboard computer. Vehicle makers promotes two arguments in their favor: first, that it could be dangerous and even malicious to alter a car’s software programming. Second, per the tractor maker John Deere, that “letting people modify car computer systems will result in them pirating music through the on-board entertainment system.” “Will”?! As the Yahoo article mentioning this story smartly pointed out, “[t]hat’s right— pirating music. Through a tractor.”
Isn’t that an example of a company getting a little too excited over its own products? Or am I just an incurable city girl (although one that occasionally likes country music)? Judging from the lyrics to a recent Kenny Chesney hit (“She Thinks My Tractor’s Sexy"), I see that opinions differ in this respect. To each her own.
Hat tip to Professor Daniel D. Barnhizer of the AALS listserve for sharing this story.
Thursday, April 23, 2015
As for the series on law school instruction and law schools in general that Jeremy started here recently: count me in!
I agree with Jeremy’s views that issue-spotting is very important in helping students develop their “practical skills,” as the industry now so extensively calls for. As Jeremy and Professor Bruckner do, I also never give up trying to have the students correctly issue spot, which in my book not only means spotting what the issues are, but also omitting from their tests and in-class analyses what I call “misfires” (non-issues). In my opinion, the latter is very necessary not only for bar taking purposes, but also in “real life” where attorneys often face not only strict time limits, but also word limits.
But I’ll honestly admit that my students very often fail my expectation on final tests. Some cannot correctly spot the issues at all. Many have a hard time focusing on those aspects of the issues that are crucial and instead treat all issues and elements under a “checklist” approach overwriting the minor issues and treating major issues conclusorily. Yet others seem to cram in as many issues as they can think of “just in case” they were on the test (yes, I have thought about imposing a word limit on the tests, but worry about doing so for fear of giving any misleading indication of how many words they “should” write, even if indirectly so on my part).
Maybe all this is my fault … but maybe it isn’t (this too will hopefully add to Professor Bruckner’s probably rhetorical question on how to teach issue-spotting skills). Every semester, I post approximately a dozen or so take-home problems with highly detailed answer rubrics. I only use textbooks that have numerous practice problems long and short. I review these in class. I also review, in class, numerous other problems that I created myself. I give the students numerous hints to use commercial essay and other test practice sources. Yes, all this on top of teaching the doctrinal material. All this is certainly not “hiding the ball.” Frankly, I don’t really know what more a law professor can realistically do (other than, of course, trying different practice methods, where relevant, to challenge both oneself and the students and to see what may work better as expectations and the student body change).
So what seems to be the problem? As I see it, it doesn’t help that at least private law schools at the bottom half of the ranking system have to accept students with lower indicia of success than earlier. But even that hardly explains the problem (who knows what really does). Some law schools have to offer remedial writing classes and various other types of extensive academic support to students in their first semesters and beyond. Some of the problem, in my opinion, clearly stems from the undergraduate-level education our students receive. In large part, this makes extensive use of multiple-choice questions for assessments and not, as future lawyers would benefit from, paper or essay-writing tests or exercises. Thus, undergraduate-level schools neither teach students how to spot "issues" from "scratch" nor do they teach them how to write about these. Numerous time have my students told me that they have not really written anything major before arriving in law school.
Why is that, then? Isn’t that problem one of time and resources; in other words, the fact that not just law professors, but probably most university professors, are required to research and write extensively in addition to teaching and providing service to their institutions? For example, see Jeremy’s comments on his busy work schedule here. Something has to give in some contexts. At the undergraduate level, maybe it’s creating and grading essays and instead resorting to machine-graded multiple-choice questions and not challenging students sufficiently to consider what the crux of a given academic problem is. Just a thought. I am, of course, not saying that we should not conduct research. I am saying, though, that I find it frustrating that lower-level educations, even renowned ones, cannot seem to figure out how to use whatever resources they do, after all, have to train their students in something as seemingly simple as how to write and how to think critically.
At the law school level, some “handholding” and various types of practical assistance is, of course, acceptable. But to me, the general trend in legal education seems to be moving towards a large extent of explaining, demonstrating, giving examples, setting forth goals, assessments, and so forth. I agree with what Jeremy said in an earlier post that we should at some point worry about converting the law school education process into one that resembles undergraduate-style (or high school style!) education.
Recall that the United States is not an island unto itself. Many studies show that our educational system is falling behind international trends. Where in many other nations in the world (developed and developing), students are expected to come up with, for example, quite advanced research and writing projects for their degrees, we are - at least in some law schools - teaching students just how to write, and what to write about. This is a sad slippery slope. Until the American educational sector as such improves, I agree that we should do what we can to motivate and help our students. But I also increasingly wish that our “millennial” students would take matters into their own hands more and take true ownership of learning what they need to learn for a given project or class with less handholding, albeit of course still some guidance. Nothing less than that will be expected from them in practice.
Monday, March 30, 2015
Earlier this month, Los Angeles-area media reported a somewhat humorous of a valet service that gave away a relatively expensive new car to a random guy claiming that he had "lost the [valet] ticket." Yup, the valet service actually just gave the car to the man who was sporting an Ohio state tattoo. (Of course, this story is not funny for the frustrated car owner).
But wait, the story gets weirder than that (it is, after all, LA, where we worry a lot about our cars...): the valet service sent the responsible employee home and referred the customer to his insurance company. Initial reports indicated that the insurance company did not want to pay for this loss as no theft had occurred... as is always the case, however, the media did not follow up on the end of this story, to the best of my knowledge.
Another valet contract that you must read and that was shared today on the AALS listserv for Contract Professors reminded me of this story. Hat tip to Professor Davis!
Valet companies may have to brush up on their contract writing skills soon...
Tuesday, March 24, 2015
The following guest post is from Tina Stark, a Professor in the Practice of Law (retired) and the Founding Executive Director of Emory's Center for Transactional Law and Practice. Tina is one of the pioneers of teaching transactional skills and the founder and first Chair of the AALS Section on Transactional Law and Skills. She is also the author of Drafting Contracts: How and Why Lawyers Do What They Do and the editor and co-author of Negotiating and Drafting Contract Boilerplate. Welcome, Tina!
When I speak about contract drafting, I often state that contract drafting sits at the intersection of law and business. Students can learn about style, organization, process, interpretation, ambiguity, and clarity, but if they don't know the law and understand the deal, the contract will be ripe for litigation.
In Buckingham v. Buckingham, 14335 314297/11, NYLJ at *1 (App. Div., 1st, Decided March 19, 2015), a well-known matrimonial lawyer botched the drafting of a prenuptial agreement. As drafted, the relevant provision stated that if the husband sold "MS or any of its subsidiaries or related companies," he was obligated to pay the wife a share of the proceeds. But the provision did not address the consequences of the husband's sale of any shares he owned in those businesses. Stated differently, the agreement gave the wife the right to proceeds from asset sales, but was silent about the right to proceeds from stock sales.
The couple married; time passed; and the marriage failed. Along the way, the husband sold shares of his business and the ex-wife wanted her share of the proceeds: about $950,000. The husband and the courts said "no." The court reasoned that the relevant language created a condition to the husband's obligation to pay sale proceeds to his ex-wife, but that language encompassed only asset sales. Therefore, because the husband's sale of shares did not satisfy the condition, the wife had no right to any proceeds. (Technically, there was a condition to an obligation and an obligation. The condition to the obligation was an asset sale, and the obligation was the husband's obligation to pay the wife a share of the proceeds. The husband's obligation to pay created the wife's reciprocal right to receive the proceeds.)
As the dissent points out, the business deal was almost undoubtedly that the wife was entitled to money if the husband received proceeds from a business disposition. But the court held the provision unambiguously applied only to business dispositions that were asset sales, and it refused to rewrite the provision. Bottom line: the wife’s lawyer didn’t know the law. She didn’t understand the difference between an asset sale or a stock sale and language embraced only the former. This is a classic case of a business issue driving the litigation, not unclear, ambiguous drafting. It was “bad” drafting, but not for reasons of style, lack of clarity, or ambiguity. It was “bad” because it didn’t memorialize the parties’ intent.
And that's why matrimonial lawyers need to understand business and business law and how drafting sits at the intersection of law and business.