ContractsProf Blog

Today in History -- November 1

1604 – William Shakespeare's The Tragedy of Othello, the Moor of Venice has its first performance, at Whitehall Palace in London.

1765 – The British Parliament enacts the Stamp Act (right) on the 13 colonies in order to help pay for British military operations in North America.  Among other things, it puts a  £10 tax on attorney licenses.  That's about $20,000 in current U.S. dollars.

1802 – Thirty-five delegates gather at a raw hamlet on the Scioto River called Chillicothe to draft a constitution for what wll become the State of Ohio.

1848 – Dr. Samuel Gregory, who believes it inappropriate for men to be attending women at childbirth, opens the first medical school for women, Boston Female Medical College.

1946 – The new Basketball Association of America, forerunning of the NBA, opens its inaugural season at Maple Leaf Gardens in Toronto, where the visiting New York Knickerbockers down the Toronto Grizzlies 68-66. The Knicks will be one of 6 BAA teams to survive to the present day.

1950 – Pope Pius XI formally defines the dogma of the Assumption of Mary in his Apostolic constitution, Munificentissimus Deus.

1959 – Jacques Plante of the Montreal Canadiens becomes the first goaltender to wear a protective mask in regulation play.

1968 – Looking for ways to add more more nudity, profanity, and violence to American films, the Motion Picture Association of America's scraps its old Hays Code and replaces it with a film rating system that categorizes films as G, M, R, and X.

1982 – Honda opens a factory in Marysville, Ohio, making it the first Japanese auto maker to build cars in the United States.

1993 – The Maastricht Treaty establishing the European Union goes into effect.  This turns out to be the easy part.  Getting everyone actually united will prove to be more difficult.

FGS

Frightening: A Halloween Costume Contract

The Washington Post gets in the Halloween spirit with reporting on this costume contract that a Michigan junior high school required parents and students to sign before the students could wear costumes to school.

 Here's the deal (no emphasis added or punctuation changes made):

 

JEANNETTE JR. HIGH SCHOOL 

HALLOWEEN COSTUME RULES/GUIDELINES
Parent Agreement Form 2010

1. All students wearing costumes to school MUST read and understand the costume guidelines. In addition, they MUST sign the registration form provided by their FIRST HOUR teacher. They must also have this form signed by their parent and submitted to their first hour teacher by the Wednesday, October 27th deadline. If form is not submitted in a timely manner, then student is NOT allowed to dress up.

2. All costume preparations are to be completed at home. (No dressing or applying of make-up or colored hairspray once students arrive at school).

3. No masks are to be worn during the school day.

4. NO COSTUMES THAT DEPICT VIOLENCE OR VIOLENT CHARACTERS!

5. Costumes that promote the use of illegal substances or activities or are derogatory or disrespectful are NOT allowed.

6. Teachers may take away any accessory that is used improperly or is considered inappropriate for school.

7. School rules regarding the dress code must be followed.

8. Students who have questions about the acceptability of their costume should check with their FIRST HOUR teacher by Wednesday, October 27th.

9. Students wearing inappropriate costumes will be sent to the office to call home for a change of clothes, and/or may result in one or both of the following disciplinary consequences: Saturday school, Suspension.

10. Students who do not submit parent agreement form by the Wednesday, Oct. 27th deadline and still choose to wear a costume will also face disciplinary action as deemed appropriate by administration.

11. Costumes MUST be worn all day.

KEEP IN MIND WE WOULD LIKE TO CONTINUE THIS TRADITION HERE AT JEANNETTE TO DRESS UP FOR HALLOWEEN, AND WE WOULD LIKE TO MAKE THIS A TRADITION FOR THE FUTURE...BE RESPECTFUL AND RESPONSIBLE!!

I have read and discussed with my child the Jeannette Jr. High School Halloween costume rules/guidelines. I understand that if my child violates any of the above rules, he/she will have earned Saturday school and/or suspension as a consequence. I also understand that this form must be signed and returned to my child’s 1st hour teacher, on or before Wednesday, October 27th. 
X_________________________________ 
(print student first and last name) 
X_________________________________ 
(student signature) 
X_________________________________ 
(print parent first and last name) 
X__________________________________ 
(parent signature) 

Wow, frightening indeed!  It sure leaves a lot open to interpretation, including whether a costume depicts a "violent character" and whether certain costumes are "inappropriate."  Some traditional Halloween staples come to mind as arguably violent: the devil? grim reaper? vampire?  This year's most popular costumes are apparently Lady Gaga and Jersey Shore characters: appropriate?  And, what is the remedy if a student doesn't comply with paragraph 11?

[Meredith R. Miller]

Pesky Typo Dooms Luxury Condo Developer

In New York, a protracted court battle rages between a luxury real estate developer and 41 condo owners seeking the return of their deposits.  Many of their sales contracts for units at The Rushmore were executed at the height of the real estate market.  Now the buyers want out, and they argue that the contracts entitle them to the return of their deposits if at least one sale did not close by Sept. 1, 2008.  The first closing did not occur until February 2009.  The developer argues, however, that there was a typo in the contract and the date was intended to be September 1, 2009.  In response, the buyers argue that the contract should be enforced as written. 

The case has worked its way through the federal court and now is finding its way back to state court.  The WSJ reports:

The Second U.S. Circuit Court of Appeals in Manhattan this month affirmed a May district court ruling that said the developers couldn't block the release of the deposits now held in an escrow account.

The developers appealed to federal court—rather than taking the more traditional route to state court—arguing that the attorney general's ruling violated the U.S. Constitution because they were denied due process of law because they weren't permitted to contest and evaluate the charges against them.

Richard N. Cohen, an attorney for a group of the condo buyers, said the buyers "question the developers' motivation in continuing to drag out this case in a different forum, having been unsuccessful in the federal courts and with the attorney general."

Presumably, if the developer has to find new buyers, it will never get close to the prices of these contracts and it will likely turn the development into losing proposition.

[Meredith R. Miller]

 

Happy Halloween!

There's one one horror film I know of where the heroes include a business lawyer and a university professor, but that one is one of the best.  It was the scariest of my childhood, hands down.

  

FGS

Weekly Top Ten

Not much change at the top, but three new papers crack our weekly Top 10.  Following are the top ten most_downloaded papers from the SSRN Journal of Contract and Commercial Law for the sixty days ending October 24, 2010. (Last week's rank in parentheses.)

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

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

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

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

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

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

7 (–)  Choice of Forum Provisions in Intra_Corporate Litigation: Mandatory and Elective Approaches, Joseph Grundfest (Stanford).

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

9 (–)  Contractors and the Ultimate Sacrifice, Steven L. Schooner & Collin D. Swan (Geo. Washington).

10 (–)  Vertical Restraints, Dealers with Power, and Antitrust Policy, Herbert J. Hovenkamp (Iowa).

FGS

Today in History -- October 31

1517 – On the Eve of All Hallows, law-school dropout Martin Luther posts his 95 theses on the door of All Saints Church in Wittenberg, Saxony..

1659 – John Bradshaw (right), Lord Chief Justice of England, who presided at the trial of King Charles I, dies of natural causes at Westminster.

1822 – Mexican Emperor Agustín de Iturbide dissolves the republican-dominated Congress and appoints a junta, setting the young nation on a path of political turmoil that will plague it for more than 150 years.

1861 – Lawyer-turned-soldier Winfield Scott, hero of the Mexican War, resigns after 20 years as Commanding General of the U.S. Army.

1864 – President Abraham Lincoln declares that Nevada has been admitted as the 36th U.S. state, just in time for the Presidential election scheduled in 8 days..

1913 – The first transcontinental automobile route in the U.S., the Lincoln Highway, is dedicated. It will take hardy drivers about 30 days to drive from New York City to San Francisco..

1924 – The First International Savings Bank Congress, meeting in Milan, votes to create "World Savings Day." The bankers presumably were unaware that spending money you don’t have is better for the economy than saving money that you do have..

1983 – George Halas, who took over the Decatur Staleys in 1921 and moved the team to Chicago, and who helped create the National Football League a year later, founded the Chicago Bears football team in 1920 at age 25, dies in Chicago at age 88.

2002 – A federal grand jury in Houston indicts former Enron Corp. CFO Andrew Fastow on 78 counts of wire fraud, money laundering, conspiracy and obstruction of justice.

News Briefs -- October 30, 2010

CHICAGO:  "A group of hedge funds sued the four banks that funded Tribune Co.’s 2007 leveraged buyout, alleging that the lenders knowingly rendered the company insolvent and precipitated its 2008 bankruptcy."

PERTH:  "ASX-listed Macarthur Coal on Thursday advised shareholders that two of its subsidiaries, Monto Coal and Monto Coal 2, have been served with a claim for damages of A$1,2-billion for breach of contract."

LOS ANGELES:  "The legal fight over whether the 2007 film Disturbia is a rip-off of an Alfred Hitchcock classic is far from being in the, um, rear window."

HARTFORD:  "As [Connecticut] voters go to the polls this week to select a new attorney general, they also will choose a new direction for how the state handles claims involving public construction projects."

NEW YORK CITY:  "New York Surf Film Festival co-founder Morgan Berk has filed a lawsuit against the other three founding parties, seeking damages for trademark infringement, defamation and breach of contract."

TEL AVIV:  "The Turkish government and military have suspended all major defense orders and most follow-up contracts with Israel."

FGS

 

 

Couric, facing "massive" salary cut, hits road to talk to little people

Things aren't going well at CBS for America's Sweetheart, Katie Couric.  As her five-year deal comes to a close with her newscast dead last for the fifth straight year, reports are that she'll either have to take a big pay cut or get banished to cable.  This may seem unfair, since her predecessor Dan Rather was allowed to finish last for about 25 consecutive years without getting a pay cut, but times are tougher now.

So Couric has decided to hit the road to connect with what she blithely calls "the great unwashed" our here in the middle part of the country which she doesn't see very often.  Some of the folks here in Texas got a little offended by that, since many of us bathe every Saturday and change our underwear twice a week, but Couric assures us that she "wasn't being disparaging."  That's just apparently what they call us in Manhattan.

You have to wonder what she thinks saying things like that will do for either her ratings or her contract renewal.  CBS CEO Les Moonves says he's still really happy he lured her away from NBC five years ago with a massive $15 million-a-year contract, but now says the network hasn't even begun to talk about extending her contract.  That doesn't sound like a good sign.

FGS

Today in History -- October 30

1340 – The last Muslim invasion of the Iberian peninsula is turned back by Alfonso IV of Portugal and Alfonso XI of Castile at the Battle of Rio Salado.

1485 – One of the few English monarchs with a head for business, Henry VII of England is crowned at age 28.

1735 – Lawyer, statesman, and future U.S. President John Adams is born at Braintree (now Quincy), Massachusetts.

1864 – A few months after discovery of gold there, the little Montana hamlet of Last Chance Gulch reorganizes itself and changes its name to "Helena."

1905 – Russian Tsar Nicholas II grants Russia’s first constitution. It will turn out to be too little and too late.

1938 – Mercury Theater of the Air, a CBS radio summer replacement series with dismal ratings, gets huge bump in listenership when it broadcasts a radio version of H.G. Wells's The War of the Worlds.  The broadcast is so popular that Campbell’s Soup signs up as a regular sponsor.

1947 – Representatives of 23 countries sign the General Agreement on Tariffs and Trade—the predecessor to the World Trade Organization—at Geneva.

1961 – Josef Stalin’s body is removed from its place of honor inside Lenin’s tomb and buried elsewhere. Can you Imagine how evil you have to be to be unworthy of sharing a tomb with Lenin?

1968 – Film star Ramon Novarro (top left), who made as much as $100,000 per film during the silent era and prudently invested in Los Angeles real estate, is beaten and killed in his home by two young men who steal $20 from him.

FGS

Deadweight loss explained . . .

. . . by the economists at Marginal Revolution.  It's a concept some people have trouble with, and Alex Tabarrok offers a nice illustration.

FGS

Capping interest rates for "predatory" lenders

Voters in the Big Sky Country will be voting this coming Tuesday whether to put a cap on the interest rates charged by "nontraditional" lenders like payday and auto-title loan companies.  On the Montana ballot is an initiative that would cap the annual interest rate at 36%.  An unsecured two-week $100 loan -- which now might carry a $15 charge -- will now have a maximum charge of $1.38.  Assuming someone is willing to lend money at that rate.

The bill is expected to pass.

FGS

Beh & Stempel on "unilateral" insurance contracts

In the mail today, a nice reprint of Hazel Beh (Hawaii) & Jeffrey W. Stempel (UNLV), Misclassifying the Insurance Policy: The Unforced Errors of Unilateral Contract Characterization, 32 Cardozo L. Rev. 85 (2010), which Hazel and Jeff previewed at the February 2010 Spring Contracts Conference at UNLV.

I'm a sucker for discussions about the unilateral/bilateral thing, and the two authors do a good job of explaining why the distinction matters in the context of insurance contracts.  Here's the abstract:

Insurance policies are traditionally classified as unilateral or “reverse-unilateral” contracts, a characterization we find largely incorrect, with problematic consequences for adjudication of insurance coverage disputes. In addition to the general difficulties attending the unilateral classification, the concept as applied to insurance policies is not only unhelpful but incorrect. Insurance policies are more accurately viewed as bilateral contracts. In addition, the unilateral characterization of insurance policies introduces error and inconsistency into the litigation of insurance controversies. In particular, the unilateral view tends toward excessive formalism and focus on so-called “conditions” precedent to coverage, eschewing material breach analysis and encouraging needless forfeitures as well as unwisely removing the concept of anticipatory repudiation and corresponding remedy from insurance law. Categorizing insurance policies as unilateral fails to appreciate the ongoing, iterative nature of insurance policies and the insurer-policyholder relationship. Recognizing the bilateral nature of insurance policies holds substantial potential for improving insurance coverage adjudication.

If you don't have Lexis/Nexis there's a version of it on SSRN here.  You can probably get a copy from the authors, too.

FGS

"God loves a cheerful giver"; India doesn't care about the "cheerful" part

Giving away money to worthy causes is a good thing.  Such a good thing, apparently, that the Indian government has decided to make it mandatory.  The government has instituted a rule that requires Indian corporations to give 2 percent of their net income to "philanthropy."

In the U.S., corporate philanthropy tends to go disproportionately to elite institutions like art museums, opera houses, and universities, rather than to grass-roots level programs.  It will be interesting to see how much of this new philanthropy will go toward addressing poverty, and how much to the country’s elite institutions.

FGS (quoting 2 Corinthians 9:7)

Smart, talented, pretty, and she seems to like fat guys

There are lots of lawyers who want to be pop music stars.  It’s more unusual for a pop star to want to be a lawyer.  But that’s the story of popular Korean singer Nikki (So Eun) Lee, who’s now apparently at 2L at Northwestern, and having a great time.  This is her.  (She?):

 

FGS

 

Today in History -- October 29

1618 – The father of the tobacco industry, Sir Walter Raleigh is beheaded at Whitehall at the age of 66 for alleged treason.

1787 – Mozart's opera Don Giovanni premieres at the Estates Theater in Prague. Turn up the volume and enjoy the incredible Overture.

 

1815 – Songwriter Daniel Decatur Emmett, the author of the Southern anthem "Dixie,"is born at Mount Vernon, Ohio. A staunch opponent of Secession, he will go on to write the fife and drum manual for the Union Army.

1901 – Leon Czolgosz, the anarchist who assassinated President William McKinley, is executed by electrocution at Auburn Prison in New York.

1911 – Joseph Pulitzer, a wealthy businessman who made a great deal of money campaigning against wealthy businessmen, dies on his yacht while traveling to his winter home in Georgia.

1929 – The day after Black Monday, October 28, stocks continue to tumble on "Black Tuesday."  The Great Depression is under way.

1955 – The creator of the Hollywood studio system, Louis B. Mayer (born Lazar Meir in Minsk) dies of leukemia at Los Angeles. On his watch Metro-Goldwyn-Mayer became the most profitable film studio in the world.

1968 – UCLA student Charley Kline transmits the first message ever sent from one computer to another over the new ARPANET system. The system crashes in the middle of the transmission.

2004 – European heads of state sign the Treaty Establishing a European Constitution, which will be submitted to member states of the European Union for ratification.  It will fail.

FGS

 

Bonding at the Meat Market

Over at Prawfsblawg, Florida State's Dan Markel discusses a problem: interviewees at the AALS job conference who waste the time of law school hiring committees by agreeing to be interviewed (and even to be brought back for a campus visit) when they have no real interest in going to the school.  He suggests mechanisms for dealing with this, such as requiring interviewees to pay for their own trips out (refunding the money if they are rejected or if they accept the job) or requiring interviewees to make charitable donations as a sign of their interest in a school.. These "bonding costs" allow the parties to reveal their real intentions.

Sure, it may seem a bit hard to make the interviewees (who are the only ones there NOT on expense account and who have already been charged an arm and a leg by the AALS to be there) to pay more money, but the suggestion does improve the information available to both parties.  From my experience, however, lots of schools waste the time of applicants in whom they know they aren't really interested.  These schools fill up the dance cards of interviewees and sometimes cause them to turn down an interview with a school where they might actually get an offer.  Consistent with Markel's idea, I suggest that hiring committees signal their interest by paying each interviewee they schedule $250, which the interviewee will repay when offered the job.  This will help applicants get a better idea of who's really serioius about them and who's just filling slots or papering the record for diversity or internal political purposes.

Well, think about it.

FGS

N.J. law school clinics subject to Open Meetings law

A New Jersey court has apparently ruled that law clinics at the state’s two government-owned law schools (Rutgers-Camden and Rutgers-Newark) are subject to the state Open Public Records Act. Material protected by the attorney-client privilege can be withheld, but other records will have to be produced.

The court rejected arguments by the American Association of University Professors, the Clinical Legal Education Association, and the Society of American Law Teachers, who argued that compliance with the law would have a negative impact on the services they provide.

FGS

NY Magistrate Recognizes Cal. Surrogacy Contract

In a New York child-support proceeding, Family Court Support Magistrate Rachel J. Parisi (Suffolk County) upheld a California judgment of paternity for twins conceived pursuant to the terms of a gestational surrogacy contract.  The judge accorded the judgment full faith and credit despite New York's public policy barring surrogacy contracts.  The court pointed out that the issue was not the validity of the underlying surrogacy contract but, rather, a subsequent judgment of paternity.

The NYLJ reports:

D.P. is the twins' biological father. T.R. was his romantic partner.

Both men are New York residents. Because New York law does not recognize surrogacy contracts, they entered into a surrogacy agreement with a woman in California, one of approximately 38 states to legally recognize such contracts.

Surrogacy contracts were barred in New York in 1992 by state legislators, some of whom decried the process as "baby selling."

Many New Yorkers now go out of state to set up legally enforceable surrogate agreements—Sara Jessica Parker and Matthew Broderick famously hired a Ohio surrogate in 2008.

An interesting development for non-biological parents in surrogacy arrangements, one which assures their parentage will be recognized even though the contract itself would not be enforced in New York.

Matter of Support Proceeding, NYLJ 1202474012528, at *1 (Fam., SU, Decided October 4, 2010)

[Meredith R. Miller]

 

Today in History -- October 28

1538 – The first university in the New World, the Universidad Santo Tomás de Aquino, is founded by Papal bull on the island of Santo Domingo.  It will close in 1832.

1636 – A vote of the Great and General Court of the Massachusetts Bay Colony appropriates £400 and charters the first corporation in what will become the United States, Harvard College. The school’s first motto will be "Truth for Christ and the Church."  It will later be shortened to just the first word.

1848 – The first railroad in Spain opens. It runs 31 km from Barcelona north to Mataró.

1883 – English pottery manufacturer Thomas Twyford creates the first one-piece porcelain toilet, the "Unitas" (right), thus dispensing with the traditional wooden cabinet. Twyford’s is still in business today, and is by Royal Warrant the official toilet provider to HRH Queen Elizabeth II.  Really.

1886 – On Bedloe’s Island in New York Harbor, President Grover Cleveland dedicates the new Statue of "Liberty Enlightening the World. "

1919 – Just one day after President Wilson vetoes the Volstead Act, the veto is overridden by votes in the House of Representatives (175-55) and the Senate (65-20), paving the way for national Prohibition. It seemed like a good idea.

1929 – The Dow Jones industrial index drops nearly 13 percent; the day will later become known as Black Monday.

1936 – U.S. President Franklin D. Roosevelt, running for reelection, rededicates the Statue of Liberty.

1948 – Swiss chemist Paul Müller is awarded the Nobel Prize in Medicine for his discovery of the insecticidal properties of DDT.  It seemed like a good idea.

FGS

Dallas lawyer seeks continuance to attend 1st Rangers World Series game

Dallas lawyer Darrell Cook has been a Texas Rangers fan since the team moved from Washington, D.C., to the DFW Metroplex when he was 13.  He's been waiting nearly 40 years to see them go to the World Series.  He has tickets to the first game tonight in San Francisco.

Unfortunately he also had a pretrial hearing scheduled this morning in Irving Municipal Court.  So Cook filed what may be the most unusual request for a continuance that DFW lawyers have ever seen -- His Emergency Motion for Continuance in the case of of City of Irving v. Villas of Irving.

FGS