ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Wednesday, November 30, 2016

A Settlement Agreement That's Too Vague Doesn't Settle Much At All

I am always saying to my students that if they care about something, they should put it in their contract, and they should be specific about what it is they want. I think sometimes people might think there's something to gain strategically by being vague, but introducing ambiguity into a contract can work out very poorly (and also takes control out of the hands of the parties). A recent case out of Florida, Boardwalk at Daytona Development, LLC v. Paspalakis, Case No. 5D15-1944, is a case where the court, faced with an ambiguous description of the land at issue in a contract, just threw up its hands in frustration. 

The dispute between these two parties has been long and contentious. According to this article, it's dragged on for over a decade. It was originally rooted in an eminent domain proceeding in which Boardwalk at Daytona ("BDD")'s predecessor obtained property belonging to Paspalakis and the other appellees. The appellees contested BDD's acquisition of their land and eventually that lawsuit was settled. The settlement agreement provided the appellees with an option to purchase and operate 7500 square feet of retail space on the Daytona Boardwalk. The agreement contained no legal description or street address for the property at issue. The agreement said that the land would: (1) be adjacent to another particular business; (2) have a minimum of 50 boardwalk frontage feet; and (3) have sufficient land to build a 7500-square-foot, one-story building. Unfortunately for the appellees, there were at least three parcels of land that met this description, and they ranged drastically in size from around 7700 square feet to over 17,000 square feet. 

The problem with the description of the land in the settlement agreement was exposed when the appellees tried to operate their option. BDD offered a piece of property that met all three criteria set forth in the settlement agreement. However, the property required unusual structural design features that troubled the appellees and also came with a negative easement for light, air, and unobstructed view that benefitted the BDD property next door. The appellees therefore objected to this plot of land and asked for another one. 

BDD sought a declaratory judgment that the plot of land it proposed was sufficient under the settlement agreement and that it did not have to provide another plot of land. The appellees, in response, sought specific performance that BDD provide  a plot of land fitting the description in the settlement agreement, without the restrictions of the land BDD had offered. In the face of the counterclaim, BDD shifted stance and argued that the settlement agreement was too ambiguous to be enforced. 

The trial court sided with the appellees and ordered BDD to convey the largest possible plot of land to the appellees. BDD appealed, and this court agreed with BDD. The court noted that a description of the land in question is usually considered an essential part of any land purchase agreement, and that without any such description there are serious doubts whether the parties reached a meeting of the minds. The description of the land in the settlement agreement here was ambiguous. The trial court correctly examined parol evidence to try to resolve the ambiguity, but it didn't help. The contract terms at issue here simply could have been fulfilled by any of three very different parcels of land.  To this court, there was no contractual way to choose between them and no parol evidence that shed light on which parcel of land the parties had in mind. Indeed, the court was skeptical the parties ever really agreed on which parcel of land would be conveyed, and so the parties never reached a meeting of the minds that could be enforced. Therefore, the court reversed the order of specific performance and entered judgment for BDD instead. 

A bitter pill here for the appellees, who doubtless thought that they were getting something of value in the settlement agreement they struck and end up with nothing to show for it. But it does seem like there was considerable confusion about which land was affected by the situation here. I guess it's a lesson to all of us: try to be as specific as possible. I tell my students drafting contracts is frequently like playing a game of what-if with yourself. What if BDD offers this parcel of land instead of that parcel of land? If the answer to that question is that you would prefer one parcel of land over the other, best to be specific in the contract. 

November 30, 2016 in Commentary, Current Affairs, In the News, Law Schools, Recent Cases, Teaching, True Contracts | Permalink | Comments (2)

Thursday, November 24, 2016

A Sad and Regrettable Loss to Contract Law Academia

As our friends on the Faculty Lounge just announced, Dean Schwartz was just forced to step down as Dean of the University of Arkansas, Little Rock, School of Law. Why? After the recent presidential election, he sent an email to students offering counseling to those upset by the results. Similar initiatives were undertaken around the nation in places so politically and geographically different as the University of South Dakota and Occidental College in Los Angeles.

Apparently, what really cost Dean Schwartz his position was his personal opinion given in the email, namely that the services would be offered to students who “feel upset” following the “most upsetting, most painful, most disturbing election season of my lifetime.”

A colleague of Schwartz's, Robert Steinbuch, who previously tussled with Schwartz over diversity in admissions, explained [cite to FL]: “If you tell people every time they lose they’re entitled to counseling, you elevate the perceived level of wrong beyond what it is. Most assuredly, Democrats are disappointed a Republican won. I recall when the Democratic Party won the Presidency twice each of the previous two elections. I knew plenty of people who were disappointed at that time, but I didn’t know anybody that needed grief counseling. I think when we tell people that they need some form of grief counseling we are normalizing hysteria and suggesting there’s something immoral or wrong about our democratic process.”

How incredibly misunderstood and off point. First, there really is something wrong about our democratic process when repeatedly, the person winning most of the popular votes in an election does not become the president. Similarly, our two-party only, “winner takes it all” system is arguably not a sufficiently faceted system that can be considered to be a true representative, deliberative democracy. But I get that, the system should then be changed before the next election. That won’t happen, just like time after time, mass shooting episodes don’t cause a change to our gun laws or the mass murder situation in general. Such is our country, and so be it, apparently.

What is incredible to me in relation to the above is not Schwartz’ alleged normalization of “hysteria” (read: justified outrage), it is attempts to make this particular election appear normal. It simply was not. Everyone seems to agree on that, Democrats and Republicans alike. In fact, note that many Republicans were outraged as well – and for good reason. Should it be acceptable that we now have a President who, for example, is proud that he “grabs women by the pussy” and “just start[s] kissing them” whether or not they want it? Someone who claims that he is “smart” for not paying taxes for, apparently, many years to a country that he wants to lead, even though he could easily afford doing so? A person who, in spite of sound science proving otherwise until at least yesterday claimed that climate change is a “hoax made up by the Chinese”?

I would hope not. But as we see, apparently that is what we just have to put up with and not even opine about, even in legal academia, in the form of a sentence as innocuous as one that refers to simple, but honest, feelings shared by millions of other people as well.

Throughout history, censorship has never proved particularly effective. As a nation, if we seek to revert to such strategies, we are truly in trouble. Schwartz’ comments may well have upset Republican law students, but maybe that in and of itself would have had some value, especially in an academic setting where thoughts are valued for being just that; thoughts that just might help improve our nation.

On an up note: Happy Thanksgiving, and thanks to Michael Schwartz for being a such a courageous, thoughtful dean and legal scholar!

Greetings from Berlin.

November 24, 2016.

November 24, 2016 in Commentary, Contract Profs, Current Affairs, In the News, Labor Contracts, Law Schools | Permalink | Comments (2)

Wednesday, November 9, 2016

Here's a Nice Case to Use to Review Contract Formation, Conditions Precedent, and Promissory Estoppel

As we reach the end of the semester, I keep trying to remind my students of what we learned at the beginning of the semester, which was only a few weeks ago but feels like several lifetimes ago. As we turn our attention to our last topic of third-party rights, I don't want the students to forget the basics of contract formation. I want them to realize that contracts law builds on itself and is self-referential and so they can't just forget about the stuff that came first. 

Anyway, I say all of that to lead into this nice recent case out of the Eastern District of Pennsylvania, Killian v. Ricchetti, Civil Action No. 16-2874, that deals with issues of contract formation, and then turns to promissory estoppel. Exactly as I keep trying to remind my students to do! So I couldn't resist writing this case up for the blog. It serves as a nice review of a lot of what we've learned and I think I may actually use it in class. 

The alleged contract was a series of e-mails exchanged between two friends. The first e-mail set out a bunch of terms and ended with "there are more little details...it's a start." The response to the e-mail added a few additional terms. This, the court found, did not form a contract, because the response was not an acceptance but rather a counteroffer, due to the fact that it added terms. There was never any reply to that particular e-mail, so the counteroffer was never accepted. 

After these initial e-mails, there were further e-mails between the two regarding the real estate transactions at the heart of the alleged agreement. Those e-mails were enough to form a contract as follows: The first e-mail read, "[W]hen the Pine [Street property] is clear title we form an LLC with an equal partnership of 50% . . . ." with some further details given. The reply to the e-mail was "OF COURSE," which constituted an acceptance. However, there was a condition precedent to this contract: that the parties receive clear title on the Pine Street property in question. Due to no fault of the parties themselves, they never received this clear title, so the condition precedent never occurred, so no duties to perform under the contract ever arose. 

The court then turns to the promissory estoppel question, though. The court found here there were genuine issues of material fact whether there was a promise made and whether the other party acted in reliance on that promise. Similar issues of material fact existed for the unjust enrichment and qunatium meruit claims. Therefore, although the court granted summary judgment on the breach of contract claims, it denied summary judgment on the remaining claims. 

November 9, 2016 in Commentary, Law Schools, Recent Cases, Teaching, True Contracts, Web/Tech | Permalink | Comments (1)

Wednesday, November 2, 2016

A Student Plagiarism Contract Case

Thanks to InsideHigherEd, I became aware of this recent case out of the First Circuit, Walker v. President and Fellows of Harvard College, No. 15-1154, and seeing as it involved JOLT, the Harvard Journal of Law and Technology that I was an executive editor of when I was in law school there, I couldn't resist digging into the case. 

And I'm glad I did, because it's a really interesting case about the lingering effect of honor code violations and the wording of school academic policies. 

The plaintiff graduated from Harvard Law School in 2009. During her time at Harvard, she was a member of JOLT. In that capacity, she drafted a student note. However, when she sent the note to senior editors at JOLT, they became concerned about plagiarism issues and referred the note to the HLS Administrative Board. The Board concluded that the plaintiff's note contained plagiarism that violated the school's Handbook of Academic Policies and a notation was placed on her transcript. The plaintiff still graduated from HLS but had a "lucrative" offer of employment withdrawn after the notation was placed on her transcript. So the plaintiff sued to have the notation on her transcript removed. HLS won summary judgment at the district court level and this appeal followed. 

The court affirmed the judgment of the district court. The parties agreed that the Student Handbook constituted a contract between the plaintiff and HLS. (The court noted that this was not actually obvious under Massachusetts law but that it would treat the handbook as a contract because the parties did not dispute it.) Therefore, the court focused its review on whether the plaintiff's behavior violated the stated plagiarism policy in a way that the plaintiff should have reasonably expected.

The Handbook stated: "All work submitted by a student for any academic or non-academic exercise is expected to be the student's own work." The plaintiff's main argument was that the student note she sent to the JOLT editors was just a draft that she planned to edit in the future, and the Handbook policy should be read as only applying to completed work that was not expected to undergo further editing. The court disagreed, however. The wording of the Handbook was extremely broad, referring to "all work." A student in the plaintiff's position should reasonably have expected that any student note submitted to the editors, whether a draft or in final form, would be held to the standards of the policy. Nothing about "all work" would make a student think that drafts were omitted from the definition, according to the court. 

November 2, 2016 in Current Affairs, In the News, Law Schools, Recent Cases, True Contracts | Permalink | Comments (0)

Monday, October 17, 2016

If Albert Einstein Wins the Nobel Prize...

I was listening to the podcast No Such Thing as a Fish (highly recommended) when I learned that Einstein used his Nobel Prize money as a divorce settlement to his first wife...the only catch being that he divorced her in 1919 and won the Nobel Prize in 1921. The podcast characterized this as: "If I win the Nobel Prize, I'll give you the money." Amazing! Imagine being so confident in your Nobel Prize chances! (I guess if you are Einstein, you would be that confident.) 

I couldn't find the contract myself, although the story was verified by Time and also shows up on Wikipedia

I know I just found a new go-to hypo to use in class. 

October 17, 2016 in Celebrity Contracts, Commentary, Law Schools, Teaching, True Contracts | Permalink | Comments (2)

Friday, October 14, 2016

George Richard Lunn, Clergyman, Politician, Ice House Owner

This week, while teaching parol evidence, I taught the case of Mitchill v. Lath, which involves an oral agreement between the parties to tear down an ice house on land to the land their sales agreement was about. A student asked what the deal was with the guy who owned the land the ice house was on, and I admit I didn't know the deal, so I went and looked it up, and here's the deal: 

He was George Richard Lunn, a clergyman who was born in Iowa but settled in Schenectady, where he was elected mayor on a Socialist ticket and later served in the House of Representatives and as Lieutenant Governor of New York. I had no idea who Lunn was and thought it was interesting that he turned out to have a Wikipedia page. The Wikipedia page doesn't mention his role in Mitchill v. Lath but his Prabook entry does. 

October 14, 2016 in Famous Cases, Law Schools, Teaching, True Contracts | Permalink | Comments (0)

Monday, July 11, 2016

Do Law Profs Breach a Commercial Educational Agreement by Wearing T-Shirts with a Social Message?

A group of 1L students recently caused a stir-up at an anonymous law school by posting an anonymous complaint after their criminal law professor wore a "Black Lives Matter" t-shirt "on campus" (not "to class," apparently).   See the letter and the professor's great response here.  (For full disclosure, our colleagues on the TaxProf Blog also wrote about the story here Images).

Do students, because they enter into a contract with a private law school (or even a public one), have a legitimate reason to complain that their professors wear t-shirts with a socially and legally provocative or at least thought-provoking message?  The students wrote, "We do not spend three years of our lives and tens of thousands of dollars to be subjected to indoctrination or personal opinions of our professors."

Is this reasonable, in your opinion?  First, this comparison is not apt.  In fact, it is an extreme over-exaggeration that barely needs commenting on.  The students also comment that the "BLM" movement does not have anything to do with the law, which demonstrates the sad state of ignorance about the law and society in which many of our students - and perhaps especially those in conservative areas such as Orange County, California - find themselves (that's where the anonymous law school is thought to be located).  The movement is clearly about very little but the law and policy.  Second, students can and should expect to get a quality legal education when attending an ABA-accredited law school, but simply because they pay money for it does not entitle them to only hear about the version of the law that _they_ prefer.  In fact, as the professor so correctly notes in his response, the consumer theory should not apply to the content of one's legal education. In other words, students don't pay to only hear part of the message.  And as the professor said: students certainly don't pay us _not_ to have an opinion about the classes we teach (note that the Tshirt was worn in connection with a criminal procedure class).

What are your thoughts on this?  And why does the law school not publish its name?

July 11, 2016 in Commentary, Contract Profs, Current Affairs, In the News, Law Schools, True Contracts | Permalink | Comments (0)

Monday, July 4, 2016

Emory Announces Tina L. Stark Award for Excellence in Transactional Teaching

As a many-years user of Drafting Contracts: How and Why Lawyers Do What They Do, I was pleased to see the following press release from Emory University Law School.

Tina StarkEmory University Law School is proud to announce the creation of the Tina L. Stark Award for Excellence in the Teaching of Transactional Law and Skills. The award will be presented at Emory’s sixth biennial conference on the teaching of transactional law and skills in June of 2018.

Tina L. Stark, the founding director of Emory Law’s Center for Transactional Law and Practice and the author of the groundbreaking textbook “Drafting Contracts:  How and Why Lawyers Do What They Do,” has worked tirelessly to assure that law students have the opportunity to graduate as practice-ready transactional attorneys. Through her enthusiasm and perseverance, and with considerable grace and vision, she has nurtured the efforts of transactional law and skills educators the world over.

In honor of Tina’s considerable achievements, and in further recognition of her continued service as a beloved teacher and a cherished mentor, the Tina L. Stark Award for Excellence in the Teaching of Transactional Law and Skills will be awarded to an educator who is:

  • committed to training students to be practice-ready transactional attorneys Drafting Contracts by Stark
  • dedicated to engaging, inspiring, motivating and nurturing students
  • devoted to teaching with passion, using creative and innovative methods
  • known for achievement in curriculum or program development and pedagogy
  • pledged to advance the cause of transactional law and skills education

Nominations for the 2018 Tina L. Stark Award for Excellence in the Teaching of Transactional Law and Skills will be accepted beginning in June of 2017. Please see the Center for Transactional Law and Practice website for further details about the nomination and selection process in 2017 when the nomination window opens.

If you have any questions about the award, please contact Sue Payne at sue.payne@emory.edu.

H/T:  D.C. Toedt, On Contracts

July 4, 2016 in Books, Contract Profs, Law Schools | Permalink | Comments (0)

Thursday, June 2, 2016

Trump “University” - Fraud in the Inducement?

Donald Trump is currently attacked on many fronts, one of which for the potential re-launch as President of his now-defunct for-profit real estate training classes. The “playbook” used by the corporate recruiters for the business unit required them, among other things, to use such arguably despicable and potentially fraudulent recruiting language as the following:

“As one of your mentors for the last three days, it’s time for me to push you out of your comfort zone. It’s time for you to be 100% honest with yourself. You’ve had your entire adult life to accomplish your financial goals. I’m looking at your profile and you’re not even close to where you need to be, much less where you want to be. It’s time you fix your broken plan, bring in Mr. Trump’s top instructors and certified millionaire mentors and allow us to put you and keep you on the right track. Your plan is BROKEN and WE WILL help you fix it. Remember you have to be 100% honest with yourself!”

and

“Do you like living paycheck to paycheck? ... Do you enjoy seeing everyone else but yourself in their dream houses and driving their dreams cars with huge checking accounts? Those people saw an opportunity, and didn’t make excuses, like what you’re doing now.”

(Can you imagine reading those statements allowed for a living?)

Does promising potential students too much constitute fraud in the inducement? In a not entirely dissimilar case in our own field, law student Anna Alaburda recently lost her lawsuit against Thomas Jefferson School of Law.  Ms. Alaburda had argued that the law school had committed fraud by publishing deceptive post-graduation employment statistics and salary data in order to bait new students into enrolling. Alaburda claimed that despite graduating at the top of her class and passing the California bar exam, she was unable to find suitable legal employment, and had racked up more than $150,000 in student loan debt. An attorney for the school rejected the claims and said Alaburda never proved them. The attorney also reminded jurors that she had turned down a job offer, and that many Thomas Jefferson alumni have had successful careers. The verdict in that case was 9-3 in favor of Thomas Jefferson.

The cases are of course not similar, yet similar enough to remind us of the importance of not promising too much in the for-profit educational field (in Thomas Jefferson’s case, the school won, but a dozen other lawsuits have allegedly been filed against other schools). This makes sense from both an ethical and business risk-avoidance angle.

What about the use of the very word “University”? The media seems to stubbornly – probably for “sound bite” reasons – continue using the phrase even though the business was, in effect, forced to change its name to “The Trump Entrepreneur Initiative” after government pressure around 2010.   The business was just that, and not a certified university.

If Trump decides to start up the business again, does the media not help him do so again by using a much too favorable term? It seems like it. Linguistics matter in the law and beyond. May media PR inadvertently (or not) contribute to a potential fraud? Comment below!

June 2, 2016 in Commentary, Current Affairs, Famous Cases, In the News, Law Schools, Recent Cases, Teaching | Permalink | Comments (0)

Tuesday, May 24, 2016

How Bad Can a New Law Graduate’s Representation Be?

Pretty darned bad! Imagine this: A law student starts giving professional legal advice while still in law school. The advice is rendered to a 78-year-old Chinese-American with limited English skills and experience with the American legal system. The student renders the advice in person, over the phone, and in extensive e-mail exchanges. He even persuades the client to “assign” the lawsuit to the student so that the student would be “better able to control the suit and properly advise” the client. In doing so, the student promises to “minimize any legal costs to [the client] before [the student] getting [sic] his license by doing all the work he can carry on for said case.” The students subsequently graduates (from a California law school not accredited by the ABA, according to the website of the State Bar of California), passes the bar, and becomes the formally retained lawyer for the client.

The new graduate sues a party on behalf of his client. The graduate also names his own client on a lawsuit for an unrelated matter “only as a matter of legal procedure.” Additionally, the graduate sues his client’s defendants! The advice he renders is thought to be legally incorrect by a mediator. The client thus fires the graduate. The State Bar of California brings disciplinary proceedings against the new graduate for conflict of interest matters as well as the unauthorized practice of law. The graduate stipulates to the charges and is suspended for some time.  Trial is brought against the graduate by his former client for professional negligence, breach of fiduciary duty, unlawful business practice, breach of contract, and fraud. The client wins a judgment of $552,412.

You guessed it! The graduate does not pay. Rather, he appears in some subsequent judgment debtor proceedings, but disputes the court’s personal jurisdictions (that argument is waived once an appearance has been made, by the way). He submits briefs to the court misciting passages from outdated Matthew Bender Civil Procedure practice treaties. He refuses to produce tax returns to show his income. The court has to order him to do so. He goes bankrupt, and produces a “myriad” of inconsistent stories in the case. As the court said, “a few examples should suffice:

  • Yan testified he sold his membership in an LLC to two persons for $650,000, but could not remember their names.
  • Yan testified that his mother provided him checks, but could not remember: whether the checks numbered more than a hundred; when the most recent check was received; or when his mother last worked or her last job.
  • Yan testified that he was the sole support for his children, supported solely by his income, which for 2014 was “less than [$]10,000.” The support included rent, which included $8,400 in 2014, but he refused to provide the identity of the person to whom the rent was paid. Yan was asked the source of the money to pay his children's rent, and he said it was from his “income.” Asked if that was from legal fees, Yan said, “I don't know.”
  • Enough is enough.”

The monetary judgment against the graduate was affirmed. Years later, at least one other disciplinary matter has been brought against the graduate.

The question is: is this just one example of an unusually rotten apple? Or does this point to the assertion made by many that California really does not need a number of unaccredited law schools on top of the already large amount of ABA-accredited ones? (But note too that even the trial court record contains “no evidence of anything, only assertions as to what occurred, though [the plaintiff’s] assertions are supported by various exhibits” and not disputed by the defendant. There were, for example, “no reporter’s transcript, nor any real evidence – that is, sworn evidence….”

Comment below! The case Th is Charles Li v. Demas Yan, 2016 WL 1757283.

May 24, 2016 in Commentary, Contract Profs, Law Schools, True Contracts | Permalink | Comments (0)

Tuesday, March 8, 2016

"Crowdwork" or How to Stiff Your Employees – Twice

Outsourcing work to locations where employees earn even less than many in the United States do has already become commonplace. Now comes the corporate idea of “taskifying” work to people eager to obtain some work, even if just in bits and pieces. “Crowdwork,” as it is known, lets companies use online platforms such as Amazon Mechanical Turk or www.fiverr.com to find people willing to do routine tasks such as drafting standardized reports, filing forms, coordinating events and debugging websites, but also much more complex ones such as designing logos, ghostwriting, etc. Many of today’s work tasks can be broken up into bits and farmed out online, and many employers are already doing so. Could this also come to encompass routine lawyerly work? Quite possibly so. Researchers at Oxford Univesity’s Martin Programme estimate that nearly 30% of jobs in the U.S. could be organized in a crowdwork format within just twenty years.

In this context where few regulations or laws yet govern the contracts, workers would no longer be either “employees” or “contractors,” (which has already proved to be troublesome enough for companies such as Uber), but rather “users” or “customers” of the websites that enable, well, workers and companies (“providers”) to find each other. These transactions would not be governed by employment contracts, but by online “user agreements” and “terms of service” that currently resemble software licenses more than employment contracts. There are few, if any, legal obligations towards employees in the current legal landscape that also offers employees very few means for obtaining and enforcing something so basic pay for the work performed.

Employers today require a flexible and eager workforce that is constantly on the ready and that can maybe even work 24 hours a day. Crowdworkers provide just such availability and demand very low salaries because the name of the game seems to be to compete on prices. The problem is that workers, to have a decent life, need the opposite: stability, higher salaries than what is often currently the case, retirement, salary, and medical benefits. Do these come with crowdwork tasks? Sadly, no.

What could go wrong? Consider this case: Mr. Khan, an Indian man living in India, was eager to make some money. He decided to try Amazon’s Mechanical Turk. On good days, he would make $40 in ten hours; more than 100 times what his neighbors made as farmers. He even outsourced some of his own work to a team that he supervised. This must have violated Amazon’s Participation Agreement as all of a sudden, Mr. Khan received the message that his account was closed and “could not be reopened.”Amazingly, Mr. Khan was also notified that “[a]ny funds that were remaining on the account are forfeited, and we will not be able to provide any additional insight or action.” Talk about lopsided contracts! Using a “Contact Us” link, Mr. Khan was eventually able to get through to Amazon, which simply referred him to a contractual clause stating that Amazon had the “right to terminate or suspend any Payment Account … for any reason in our sole discretion.”

ImagesWith these types of ad-hoc online agreements, people who should arguably at least have been classified contractors if not, as in some current cases, employees. Of course, this only pertains to U.S. law, but it is important to note that not all jobs are “taskified” to foreign workers. Thus, employees risk being “stiffed” twice: once for losing their jobs to cheaper folks willing to be crowdworkers and, if they chose to work under such contracts and don’t do exactly as the “provider” requires in their apparent almost exclusive discretion, not being paid and not having any effective means of enforcing their contracts. An undisputedly troublesome development both in this nation and beyond.

How could at least the issue with medical and other employee benefits be solved? It might via universal payment systems such as those typical in EU nations. There, when employees change jobs, their vacation time, medical and other benefits travel remain in a centrally administered pool (whether government administered or privately so with tough regulations in place), they do not become discontinued with the employment only to have to be restarted under other plans as typical in this country. This system could potentially be transferred to the crowdwork arena. A percentage of each job (sometimes even called “gigs”) could be centra lly administered in a more employee-centric version than the still American employer-centric solutions. Such systems are, of course, largely seen here in the U.S. as “socialist” and thus somehow inherently negative.

As if the employment situation for workers around the world is not already bad enough, add this new development, called “a tsunami of change for anyone whose routine work can be broken into bits and farmed out online.” Our students’ future work tasks may, at least in the beginning of their careers, constitute just such work. This is a worrying development as workers in our industry and in this country in general are not seeing improved working conditions in general. Crowdworking could add to that slippery slope.

March 8, 2016 in Current Affairs, E-commerce, Labor Contracts, Law Schools, True Contracts, Web/Tech | Permalink | Comments (1)

Wednesday, February 17, 2016

Can Tenure Be Denied Based on Financial Considerations?

It's not a secret that some colleges and universities out there are really struggling. At Lake Superior State University in Michigan, where enrollment has been declining, two professors were recently denied tenure, as Josh Logue reported for InsideHigherEd. As required by the faculty association's agreement with the university, the denials set forth the reason tenure had been denied, and the reason given was the need for the university to reduce staffing in the face of the declining enrollment. The professors took issue with this reason for denial, however, because the agreement contained the following clause: 

Recommendations for tenure shall be based on:

a) Careful review of the Tenure Application File [letters of support, CV, and evaluations].

b) Consideration of the faculty member’s collegiality in their relation to faculty, students, staff, and administration.

The professors are saying that that doesn't allow for denial of tenure based on another consideration, such as financial. 

It's unclear whether there was a communication with the candidates beforehand that institutional need might impact the tenure decision. The contract doesn't seem to ever mention financial considerations impacting the faculty, or institutional need, or indeed any kind of catch-all, at first glance. It does, however, provide for an appeal of a tenure decision, so I'm curious if the denied candidates will take advantage of this, and what the eventual outcome will be. 

 

 

February 17, 2016 in In the News, Labor Contracts, Law Schools, Teaching, True Contracts | Permalink | Comments (2)

Saturday, January 23, 2016

Futures Contracts for College Education

Since college and traditional student loans can be so expensive, why not create, in effect, “futures contracts” for post-college incomes? Ct-student-loan-debt-20150821

This relatively new and unknown funding idea is being tested by Purdue University in cooperation with financial services company Verno Education.  The loans are called “Income-share Agreements” or “ISAs.” Investors lend money to students in return for a certain percentage of the student’s future income for a set number of years. A few companies and NGOs in the United States are offering contracts on a limited, pilot basis, although the idea itself is not new: Economist Milton Friedman introduced the idea in the 1950s.

Purdue President Mitch Daniels has touted the idea, claiming that the loans “shift the risk of career shortcomings from student to investor: if the graduate earns less than expected, it is the investors who are disappointed; if the student decides to go off … to Nepal instead of working, the loss is entirely on the funding providers….” Voila, truly “debt-free-college” according to Daniels.

Not so fast. First, most college students of course end up finding a job. They will thus have to repay something. That something could easily be very expensive. For example, if a student borrowed $10,000 via a contract to repay 5% of her income for five years after graduation and ends up getting a $60,000 job, she or he will have to pay back $15,000 without compounded interest.

Student protections are currently poor. For example, there is no clarity as to whether the Fair Credit Reporting Act would apply. Further regulations of this area are necessary. Meanwhile, students will have to individually bargain these types of contracts very carefully.

January 23, 2016 in Current Affairs, Labor Contracts, Law Schools, Teaching, True Contracts | Permalink | Comments (0)

Tuesday, January 19, 2016

Contracts Professors: Prepare to Meet Robolawyer

Do law students intending to practice in the areas of contracts and commercial law particularly need to consider the risk of being replaced by artificial intelligence?  It wouldn't hurt.

At this month's AALS annual meeting, Harvard Law School Dean Martha Minnow made some headlines with her comments that the threat to the jobs of human lawyers from artificial intelligence is overhyped:

Minow said she didn’t see computers having a role in matters that require subjective legal judgment. “Assessment and critique of justice and justice mechanisms, I don’t see AI taking that on. Nor do I see AI taking on ethics,” she said. “I don’t mean to suggest there is no relation between AI and ethical suggestions, but I don’t think you’ll ever get rid of the human being. There will always be a need for human beings.”

Robot-lawyer-at-deskDean Minnow's points of optimism--that matters of justice and ethics will require a human component--seem substantially correct, but they highlight a particular problem in the contract and commercial law fields. Matters of human justice, like the administration of criminal penalties and the protection of civil rights, are a natural bulwark against the replacement of lawyers by computers in those fields. The values at stake are ones that we, as a society, would be (fortunately) fundamentally queasy about taking out of human hands. But what if the stakes are "mere" money, as is frequently the case with contracts?  That is the kind of area where increased efficiencies and removal of the human element give less pause.

This sort of automation of transactional work is certainly underway, ranging from the drafting of basic transactional documents through websites like Legal Zoom to the intriguing use of smart contracts that can govern and enforce themselves, such as through application of Bitcoin-style blockchain technology. In short, teachers of Contracts are training students in a field with a high degree of risk of being automated out of existence.

Robolawyer is coming, so how do we prepare our Contracts students to become lawyers whose value-adding proposition is not susceptible to automation?  This question has many answers, I suspect, but we won't reach any of them unless we start by recognizing the problem.

January 19, 2016 in Commentary, Current Affairs, Law Schools, Teaching, Web/Tech | Permalink | Comments (2)

Thursday, January 7, 2016

Tenured Political Science Professor Fired for Statements about God

Recently, Stacey blogged here about whether tenure is a contract. Yesterday, the news broke that a tenured associate political science professor at Wheaton College, a private Christian university, may soon get to test that theory.

Shortly after the San Bernadino, California, shooting massacre, Professor Larycia Hawkins stated on her Facebook account (which listed her profession and employer) that she “stand[s] in religious solidarity with Muslims because they, like me, a Christian, are people of the book. And as Pope Francis stated last week, we worship the same God." She elaborated that “we are formed of the same primordial clay, descendants of the same cradle of humankind--a cave in Sterkfontein, South Africa that I had the privilege to descend into to plumb the depths of our common humanity in 2014.” She also wore a hijab in “embodied solidarity” with Muslim women.

The response by the College is, for now, the equivalent of “You’re fired.” The College placed Professor Hawkins on administrative leave in December "to explore significant questions regarding the theological implications of her recent public statements, including but not limited to those indicating the relationship of Christianity to Islam."  Further, "Wheaton College faculty and staff make a commitment to accept and model our institution's faith foundations with integrity, compassion and theological clarity. As they participate in various causes, it is essential that faculty and staff engage in and speak about public issues in ways that faithfully represent the college's evangelical Statement of Faith." According to Wheaton College President Ryken, however, the College also “support[s] the protection of all Americans including the right to the free exercise of religion, as guaranteed by the Constitution of the United States." Professor Hawkins’ legal team is, according to televised news statements on 1/6, exploring the possibility of a lawsuit should the professor’s preferred solution – mediation and an amicable solution – turn out to be impossible.

This case raises serious questions about the academic freedom of tenured professors – even untenured ones - with which we as law professors are also very familiar. This is perhaps even more so in the cases of private colleges. It seems to me that with a message along the lines of what even Pope Francis uttered along with a reasoned (meta)physical explanation of her views and the College’s self-professed acceptance of freedom of religion, Professor Hawkins did not act in a way that should, under notions of academic freedom, get her fired. If we as law professors do not agree with or wish to challenge certain traditional or even untraditional legal views, are we not allowed to do so because the institutions we work for or the majority of our colleagues hold another view? One would hope so. Most of us can probably agree that academic freedom is exactly all about being able to, within reason at least, provoke deeper thought in relation to what we teach. Note that Dr. Hawkins did not teach religious studies, but political science. With the current embittered debate about Muslims and terrorism around the world, Dr. Hawkins arguably raised some interesting points even if one does not agree with her statements from a Christian point of view.

Stay tuned for more news on this case!

January 7, 2016 in Commentary, Current Affairs, Famous Cases, In the News, Law Schools, Religion, Teaching, True Contracts | Permalink | Comments (0)

Wednesday, December 30, 2015

Is Tenure a Contract?

Budapesti Corvinus Egyetem - 2014.06.12 (20)Here's one for all the professors out there: Smith v. Board of Supervisors for the University of Louisiana System, Civil Action Case No. 13-5505 Section: "G" (3), out of the Eastern District of Louisiana.

Steven Smith was a tenured professor at the University of New Orleans ("UNO"). Smith alleged a series of disagreements / misunderstandings that eventually led to Smith being committed to teaching the spring 2012 semester at both UNO and a Brazilian university, the Federal University of Bahia ("UFBA"). Smith attempted to resolve the conflict by pushing his start date at UFBA to the last two weeks of his semester at UNO. He had his students at UNO use the final two weeks to work on final projects, which would be submitted to him electronically while he was in Brazil at UFBA. Smith alleged that there was further miscommunication between him and UNO administration about Smith's schedule and whether or not it was acceptable. As a result, Smith stated that he was threatened numerous times with termination. Eventually, he was encouraged to resign and did so.

Smith sued asserting several causes of action, including breach of contract. The Board responded by arguing that Smith and the Board never entered into a contract at all.

Smith first pointed to the faculty handbook and UNO bylaws as the contract between himself and the Board. However, the faculty handbook explicitly stated that it "should not be construed as a formal contractual agreement between the University and its faculty." The court therefore found that the handbook did not constitute a contract.

That was not the end of Smith's contract claims, however, and that's where the tenure issue comes in. Smith argued that his tenure provided him with "a contractual right to continued employment." To support his argument, Smith pointed to the definition of "tenure" in Black's Law Dictionary as well as a number of statements made to Smith when he was granted tenure. The Board made no argument in opposition, leading the court to conclude that, "[a]lthough there was no specific written tenure contract, the parties appear to agree that Smith's achieving tenure meant that he was no longer an at-will employee." Accordingly, the court found that tenure was a contract between Smith and the Board. Whether or not this contract had been breached was a genuine issue of material fact precluding summary judgment.

December 30, 2015 in Labor Contracts, Law Schools, Recent Cases, Teaching, True Contracts | Permalink | Comments (0)

Wednesday, December 16, 2015

Call for Proposals -- Institute for Law Teaching & Learning "Real-World Readiness"

Real world skills cartoonThe call for proposals below is reposted from our sister site, Business Law Prof Blog, as it is relevant to recent conversations here about teaching transactional lawyering skills in the context of the first-year Contracts course.  The Institute for Law Teaching and Learning has a tremendous track record of putting on conferences full of cutting-edge information on the pedagogy and practices of law teaching. The "Real-World Readiness" theme looks like another winner, and perhaps some of our readers are open to presenting their ideas to this receptive audience.

 

CALL FOR PRESENTATION PROPOSALS 

 Institute for Law Teaching and Learning—Summer 2016 Conference

“Real-World Readiness”

June 10-11, 2016

Washburn University School of Law—Topeka, Kansas

 The Institute for Law Teaching and Learning invites proposals for conference workshops addressing the many ways that law schools are preparing students to enter the real world of law practice.  With the rising demands for “practice-ready” lawyers, this topic has taken on increased urgency in recent years.  How are law schools and law professors taking on the challenge of graduating students who are ready to join the real world of practicing attorneys?  Can we be doing more?

The Institute takes a broad view of educational practices that promote real-world readiness.  Accordingly, we welcome proposals for workshops on incorporating such teaching techniques in doctrinal, clinical, externship, writing, seminar, hybrid, and interdisciplinary courses.  Workshops can address real-world readiness in first-year courses, upper-level courses, required courses, electives, or academic support teaching.  Workshops can present innovative teaching materials, course designs, curricular or program designs, etc.  Each workshop should include materials that participants can use during the workshop and also when they return to their campuses.  Presenters should model best practices in teaching methods by actively engaging the workshop participants. 

The Institute invites proposals for 60-minute workshops consistent with a broad interpretation of the conference theme.  To be considered for the conference, proposals should be one single-spaced page (maximum) and should include the following information:

  • the title of the workshop;
  • the name, address, telephone number, and email address of the presenter(s);
  • a summary of the contents of the workshop, including its goals and methods; and
  • an explanation of the interactive teaching methods the presenter(s) will use to engage the audience.

The Institute must receive proposals by February 1, 2016.  Submit proposals via email to Emily Grant, Co-Director, Institute for Law Teaching and Learning, at emily.grant@washburn.edu.

More information is available at: http://lawteaching.org/conferences/2016/

Download CFP Summer 2016 Washburn Conference

December 16, 2015 in Conferences, Law Schools, Teaching | Permalink

A Two-Credit Commercial Law Course?

I'm posting this proposal and solicitation of comments at the request of some valued contracts-prof colleagues named below. I hope you'll take them up on their request for feedback, which you can provide directly by clicking on the links associated with their names.

We – Wayne Barnes, David EpsteinPaula Franzese, and Kevin Tu – are asking for your help.

More law schools are no longer regularly or frequently offering courses in (1) payment systems, (2) secured transactions, and/or  (3) sales.  In part, this happens because these schools do not have faculty members who want to teach the courses.  And, in other cases, because students do not sign up for commercial law courses--even if the commercial law courses are taught from 11-12 on Tuesdays and Thursdays.

Most students do not need 42 class hours of payment systems, 42 hours of secured transactions, and 42 hours more of sales. ["What?! I'm appalled by this heretical statement!" - Ed.]  Lawyers in a general civil practice do, however, need to have familiarity with core commercial law concepts in order to master the specific statutory provisions that govern the transaction or litigation matter on which they are working. ["Okay, that's better." - Ed.] And, before that, there is a need to pass the state bar exam.

We propose that the needs of such students can best be meet in a two-credit course covering only core commercial law concepts, and we are working on course materials for such a course. We welcome your reasoned arguments against  this proposal.  Even more welcome would be your suggestions as to how 28 class hours can most effectively be used by students learning core commercial concepts.

We look forward to seeing you at the AALS and receiving your emails.

Luke Skywalker NoHmmm.  The idea of commercial law in two credits makes this teacher of payment systems and sales a little queasy (see my initial reaction in the selfie photo at left).  Still, I probably wouldn't argue with the proposition that some exposure to commercial law is better than none. I'm curious what the broader contracts community thinks, so I've opened up the comments below.  Meanwhile, take advantage of this opportunity to help our colleagues with an interesting project.

December 16, 2015 in Contract Profs, Law Schools, Teaching | Permalink | Comments (2)

Sunday, December 13, 2015

Contracts as a Gateway to Transactional Skills

Back in October, the New York Court of Appeals decided in principle that candidates for the bar must demonstrate that they have acquired legal skills (as opposed to just the legal knowledge traditionally tested on the bar exam). Our sister blog, Legal Skills Prof Blog, summarizes here some of the options being considered by the court's task force on the all-important question of how to implement such a skills requirement. The activity in New York is, in many respects, a supersized or advanced version of curricular rule changes adopted by the ABA. 

Contract1This curricular movement is, I believe, an opportunity for those who teach Contracts. Skills taught in law school have traditionally had a substantial bent towards litigation, a bent that is unsurprising in a curriculum dominated by the case method. Even inroads by our friends in alternative dispute resolution still deal with skills applied after a dispute has arisen between parties.  When we teach Contracts principally through appellate opinions, we follow the same after-the-fact approach toward doctrine. It doesn't have to be that way. The subject of Contracts is inherently a matter of transactional importance that should be our students' gateway to transactional thinking. By transactional, I mean an emphasis on "before the fact" lawyering where the goal is to prevent a dispute from occurring in the first place. In an era of greater focus on the acquisition of legal-practice skills, Contracts is the place where we have the possibility early on to ensure to skills include a focus on dispute prevention, not just dispute cure.

Transactional thinking is not inherently built-in to the case method and thus likely requires the introduction of skills exercises alongside traditional pedagogical approaches. More resources than ever are available now to enable us to make Contracts a gateway to transactional thinking, fortunately. Implementing such a shift still requires substantial work, however, but the change is one that is in our students' best interests if we can do it well. 

December 13, 2015 in Commentary, Law Schools, Teaching | Permalink | Comments (5)

Tuesday, December 8, 2015

Out with the Smart Aleck Professors, In with the Party Loyalists

A few days ago, I blogged here on an attempt by some university professors in California to unionize and to obtain better pay and working conditions in general.

In China, university reform is also underway, but, at least in part, with a much more troublesome intent and potentially dire effects for the nation and the world.

The Guardian reports that China’s education minister has vowed to “drive smart alecks, dissenters and thieves” from the country’s university classrooms. This is part of a wider anti-corruption campaign launched by President Xi three years ago.

The alleged misconduct ranges from action that seems reasonable (firing university leaders for filing fake expense reports and taking bribes from students) across the pitiful and almost laughable (punishing senior university officials for engaging in illicit acts of “hedonism” by, for example, driving luxury cars) to the outright shocking and extremely troublesome, seen with Western eyes. For example, several university chiefs have been toppled for “flouting Communist party rules.” Attempts are made to ban books that attempt to spread “Western values.” The education minister has also called for “greater political screening of academics before they are hired” and is worried that “enemy forces” are attempting to “infiltrate university campuses” in order to “turn young minds against the party.”

Liberal academics claim that the discussion and study of sensitive topics has generally become increasingly difficult under the leadership of President Xi.

All this is indeed very troublesome indeed. However, before we roll our eyes too much at these serious Chinese events, let us just remember that the United States academic world is far from perfect either. Recall, for example, the recent defunding of various law school and other university clinics on East Coast campuses for, at bottom, being too liberal and assisting the lower class in obtaining better pay and working conditions. A former senior faculty colleague personally told me once that one of my papers on (are you ready?) climate change was almost “too political” in Orange County, California. The article discussed mainstream factual aspects, including business and investment issues, of climate change that are now, just a few years later, being discussed in Paris by all media, including conservative outlets. Recently, numerous attempts at diversifying college campuses across the nation have shed light on potential elitism and racism in American universities. Nope, we are far from perfect ourselves. But when an entire nation deliberately and officially seeks to censor learning processes, there is indeed cause for alarm.

Last year, I had the great honor, joy and privilege of teaching international environmental law at a prime Chinese university. I brought up such “sensitive” topics as public participation in government law- and decision-making, climate change, and trade in endangered species. I was videotaped doing so (this is normal practice in China). I was also not invited back this past summer. Maybe my teaching is simply no good. Maybe more senior and “famous” lecturers were chosen.   I cannot blame the university for doing so at all. I know that I have a lot with which I can contribute to any educational institution, but I also bow to and honor the many experienced, learned and very well published colleagues on the “market” these days. However, hate to think that I was, perhaps, censored away. I don’t think that is the case. If it was, then I am nonetheless happy to have at least contributed with a few provocative, Western thoughts. Perhaps I was just too much of a smart aleck...

 

December 8, 2015 in Commentary, Current Affairs, Labor Contracts, Law Schools, Teaching | Permalink | Comments (0)