Wednesday, June 17, 2020
Guest Poster Hila Keren, Should What Happened in the Room Stay in the Room? Contract Law Has the Answer
Finally, contract law is in taking the lead in national news. As reported yesterday by the New York Times, the Trump administration has just sued the former national security adviser John R. Bolton using the argument of breach of contract in an effort “to delay the publication of his highly anticipated memoir about his time in the White House.” The book, titled The Room Where it Happened, is supposed to be released next week. , 2020. In fact, it is already available for advance purchase. Amazon, for example, offers Kindle users to buy it immediately, promising that it will be auto-delivered on June 23, 2020. But now, in a lawsuit against Mr. Bolton filed yesterday in federal court in Washington, the Justice Department seeks to prevent the upcoming publication, and both the leading cause of action and the primary remedy are contractual.
According to the lawsuit, Mr. Bolton signed a series of nondisclosure agreements (NDAs) that required him to complete a prepublication review process and receive written authorization from the US government before publishing his book, an obligation that he is now breaching “knowingly, willfully, and deliberately.” And, due to this alleged breach of contract, the DOJ “seeks an order directing [Mr. Bolton] to specifically perform his contractual obligations.” Perhaps out of awareness of the limits of the remedy of specific performance in our system, especially when “the book has already been printed and bound and has shipped to warehouses,” the DOJ further asks the court to “impose a constructive trust for the benefit of the United States over…all monies, gains, profits, royalties, and other advantages” that Mr. Bolton and others will derive from the publication of the book.
The New York Times reports that Mr. Bolton’s lawyer has counter-argued that “his client acted in good faith and that the Trump administration is abusing a standard review process to prevent Mr. Bolton from revealing information that is merely embarrassing to President Trump, but not a threat to national security.” Reading the lawsuit, one learns that Mr. Bolton submitted his manuscript for review back in January, and—due to the duration of the review process—already postponed once the date of publication. In light of these facts, it may be a good idea to turn next to section 205 of the Restatement (Second) of Contracts that, as we all know, states: “Every contract imposes upon each party a duty of good faith and fair dealing in its performance and its enforcement.” (emphasis added). Does the lawsuit present a good faith attempt of the US Government to enforce on Mr. Bolton his obligations under the NDAs?
[Editorial addition: who knew that Bolton (a/k/a Deep 'Stache) was such a Randy Rainbow fan?]
Thursday, June 4, 2020
Some students are filing class action lawsuits against their colleges and universities for partial tuition refunds and refunds of other fees. As Jeremy noted last week, some schools have given students refunds. Others, apparently, have not. But the fees involved are not all the same. The specifics of the lawsuits might differ but basically, the students are arguing that they should get some money back because their educational experience is not what they expected. Although faculty are trying their darnedest with Zoom and making their voices hoarse with recording and re-recording their lectures, these students say that the distance learning experience pales in comparison to the in-person experience. We miss our professors, they say, We want them back and their disembodied voice on an audio file or their Zoomed-In-too-close-for-comfort-face is a poor substitute for their classroom presence!
As this article from Bloomberg notes, the students are unlikely to prevail for a variety of reasons, at least on many of the claims. But the lawsuits raise lots of contracts issues that warrant more discussion on this blog. Fees for dining expenses and on-campus housing should be partially refunded because they are essentially prepaid fees that were not provided.
However, there are often other “services” fees that I think should not be refunded even though students were hustled off campus in early March. Many services were/are still being provided to students even when they moved off-campus, including IT assistance, counseling, and guidance services. Other fees relate to activities and although clubs are not meeting on campus, many continue to meet or plan future events virtually.
Furthermore, maintenance services and administrative services continue, even if less frequently for the former and remotely for the latter. Included in the administrative services are activities which may likely benefit them in the future. Students understand (or at least they should) that when they enroll at a college or university, they are joining a community. They are receiving an education but they are also going to be receiving benefits in the future from having attended that university. There is, of course, the value of the degree. But there is also the benefit of joining the alumni network, which is quite valuable at some places. There are also alumni events and activities, including continuing education or special lectures. The tuition of current students provides funding for some of those activities.
While there is justification for refunding some (although not all) fees, I’m less inclined to think students are entitled to partial tuition refunds and here’s why.
First, most universities don’t make specific promises in their enrollment contracts regarding where or how their courses will be offered. I also don’t think that most students consider those specifics. I don't think there is a breach of contract with respect to the education delivery part of it. I think the student-plaintiffs are confusing the glossy marketing material with the contractual terms. But the glossy brochures are just that – glossy brochures with happy coeds and engaging professors. Universities generally don’t give you back your money if it turns out that your roommate is super grumpy and your professor’s droning monotone puts you to sleep.
The contract issue is really one of omitted terms. The parties did not address what would happen in the event of a pandemic and ensuing state-ordered shut-down of campuses. For that, we have to go to the squishy world of interpretation. What did the parties intend when they entered into this agreement? What was the purpose of the agreement? The purpose was to provide the students with an education. Most schools are continuing to do that. It may not be what the students had in mind, but that’s not the proper question. The question is, what would the parties have done if they had contemplated this situation? Would they have insisted upon a partial tuition refund? And if so, would the schools have agreed to it?
I don’t think so. If the students insisted, the school might simply have accepted other students. But I also don’t think the students would have insisted upon a partial tuition refund if the choice were to sit out an entire year or attend three quarters of the year on campus and a quarter online (put in equation form, ¾ year on campus + ¼ online OR gap year + graduating one year later from college). Of course, they would have preferred the full year on campus but that wouldn't have been on the table. Given that, would they have walked away? Especially knowing that there weren’t other schools willing to give them what they wanted?*
In addition, without looking at any particular contract, my guess is that most enrollment contracts don’t contain force majeure clauses. But I don’t think a force majeure clause provides all the answers anyway (even in these pandemic times when they seem to be getting all the attention).
All tuition payments have already been paid so the students’ performance can’t be excused, after all. (It would be a different matter entirely if the pandemic occurred at the very beginning of the semester and students wanted to cancel their enrollments for that term. It’s different b/c the pandemic spread, and schools were ordered closed, three-quarters of the way through the academic year). The schools are not trying to get out of their contracts; in fact, they are doing whatever they can to perform. The issue is, are they providing substantially what was bargained for? My guess is that most are. At least from this faculty member’s standpoint, we are dancing as fast as we can and putting in at least twice as much time as we typically do preparing for classes. Many of us are also spending more time with students on Zoom than we would if we were just holding office hours. I would think most schools are providing substantially similar services as they were pre-shutdown even if the services are virtual.
In any event, I can’t even begin to guess what expectation damages might be. The value of the education can’t be valued pro rata based on number of weeks or hours. It is also not easy to separate out the portion of the tuition which is simply for the education in the classroom versus the general benefits of attending the college or university. The same experience that the students are claiming they are not getting is exactly what will make it so hard to calculate damages.
Ultimately, I think the students should not prevail because the result would be disastrous. Universities and colleges are already going to be in a world of hurt and partial tuition refunds in this situation would just create a chain reaction of more problems. Staff and faculty would be cut, services paired back, and financial aid to the next class would be greatly reduced. I say this, not just as a faculty member, but as a parent who would be getting a hefty chunk of change back if my daughter’s institution issued partial tuition refunds. But in the long run, I know that it wouldn’t be worth it.
The fact is, this pandemic has wreaked a lot of damage across the board. Some have been hurt more than others. If there’s a great lesson from this pandemic, it’s that we live in a society and our actions affect others. Society benefits when pains are evenly distributed and when they don’t fall disproportionately on some groups. It makes sense for those who can, to suffer a little in order to prevent greater suffering for others. In some cases, this means people stay inside even if they are young and healthy. In all cases, it means making adjustments to the extent that we are able if it would prevent greater harm in the future.
*Note that this is not the same decision faced by students contemplating a gap year for the fall. The choice for them is 1 year or (.5 year of online learning gap year+.5 year on campus) OR gap year + graduating one year later from college.
Sunday, May 31, 2020
Saturday, May 9, 2020
We are proud to have friends of the blog at TAMU law. Our founding editor, Frank Snyder is there, as is long-time contributor Mark Burge. As schools struggle to find ways to share the joys of graduation with their communities, it is nice to see faculty members willing to go to such lengths for their students.
Thursday, May 7, 2020
As you may have noticed, this blog is mostly but not entirely about contracts law. Sometimes we wander slightly off topic and address legal education and the practice of law more generally. This post is along those lines.
This past year, I taught three courses at the Northern Illinois University College of Law as an adjunct. It was a great experience overall, but perhaps the best part of it was sharing an office with Wendy Vaughn, with the added bonus of an across-the-hall neighbor, Robert Jones (pictured, left). The three of us attended NYU Law together, and it was great to be reunited at NIU. Back when we were students, Robert and I taught constitutional law to high school students as part of a street-law program. I hadn't had the course yet, so Robert was really my first con law professor. I taught Con Law II at NIU, and Robert and I got to mix it up just like in the old days, except that we've both learned a thing or two in the interim.
When he's not teaching or helping students prepare for the bar (which is almost always), Robert has been tracking U.S. News reputation reports for nearly ten years. His most recent update is available on SSRN. For those who want to dig deep, there are a lot of interesting nuggets in the update. Here are some highlights:
- Academic reputation scores generally are on the rise, but they remain lower than they were in 1998;
- Schools with the best reputations find it hardest to maintain their scores; schools with the worst reputations are most likely to improve, but for most schools there is not much movement in either direction;
- Many of the schools that have experienced a dramatic improvement in reputation scores since 1998 are private schools that recently went public and affiliated with larger, better-known state universities (Michigan State, Texas A & M, and most recently, U of I -Chicago)
- Overall, just under 12% of all law schools have improved their reputations by 0.3 or more.
The article does not address issues beyond what the statistics on reputation reveal, but I suspect that Robert has his opinions. For example, what explains the rise in reputation scores in the few schools that have enjoyed such a boost? For the schools that were acquired/merged with state schools, the answer is obvious. Are the schools any better as a result of these moves? Did their bar passage or employment rates improve? Did their faculty members start publishing more or better scholarship (to the extent that such things are measurable)? And how do we explain the reputational rise of the other success stories: Alabama, Georgia State, Howard, CUNY, Pepperdine? Did these institutions change? Did their marketing improve? What of schools that really have improved in some measurable way. Does reputation change when a school gets a $50 million gift and launches new programs? How about if student outcomes improve?
Finally, perhaps this is too obvious for Robert to mention, but my hunch is that the reputation of law schools dipped as a result of a causal chain. In the aftermath of the great recession, in part because jobs dried up. As a result, there were legitimate reasons to think that legal education was not worth the sticker price. At the same time, there was a flurry of journalism and some law suits alleging that law schools were engaged in predatory tactics -- admitting unqualified students to keep admissions numbers up. The legal academics who fill out US News surveys ought to know that those issues do not relate to the qualities that academic reputation scores seek to measure. If anything, the reputations of the top-tier schools ought to have been untouched, since they were relatively insulated from the downward pressure on admissions standards. And yet, Robert's data suggests that the top schools struggled the most to retain or improve their reputations. I can only conjecture that everyone's thought about the quality of legal education was diminished across the board during the downturn in legal education. Legal academics came to harbor doubts about the value of their educational mission, not to the extent that the critics of "failing law schools" did, but just enough to depress reputation scores over all.
Sunday, October 20, 2019
- 55 percent of Californians at all income levels experienced at least one civil legal issue in their household within the past year, yet nearly 70 percent of them received no legal assistance.
- On average, low-income Californians had more than four civil legal problems per household, while those with higher incomes, on average, had slightly more than two.
- Californians sought legal assistance for fewer than one in three legal problems.
- Most Californians do not receive legal help: 27 percent of low-income Californians received some legal help, while 34 percent of higher-income Californians did.
- Nearly 40 percent of low-income Californians who sought legal help reached out to legal aid organizations, but the current system cannot help everyone who needs it. The State Bar projects that Californians will seek legal aid for approximately 450,000 civil legal problems this year; just over half will receive some help, and only 30 percent will be fully served by legal aid.
- The most common categories for civil legal problems affecting Californians at all income levels are health, finance, and employment.
- Californians gave multiple reasons why they did not seek legal help. The most commonly cited reasons included:
- uncertainty about whether their problem was a legal issue;
- belief that they needed to deal with the problem on their own; o fear of pursuing legal action; and
- concerns about costs.
More information on preliminary findings from the survey can be found in the California Justice Gap Study Technical Report. See also this report.
In my podcast interview with law professor Benjamin Barton on Rebooting Justice, we discuss various ways in which the serious need for legal services can be improved. This is of course a conundrum as legal practitioners very reasonably expect to be repaid for the costs (and agony) of going to law school. On the other hand, many new practitioners cannot find work and could maybe build their resumes and gain valuable experience if working at lower rates and in untraditional attorney/client relationships.
The existing problem is a clear market failure. It is astonishing that in a country with one of the highest number of attorneys per capita in the world, the general public cannot and/or do not obtain the legal assistance they need. Perhaps the time has truly come for institutions of higher learning to focus on training more affordable legal service providers and fewer actual lawyers. Many new law graduates have difficulty finding work anyway. From a consumer point of view, it is also troublesome that some people – the ones at the bottom of their class – can officially get a J.D. and, with much hard work and arguably some luck, pass the bar and thus call themselves attorneys at law albeit with sometimes very substandard qualifications. I am sorry to say this, but as a law professor, I know this to be true. Would it not be better to create some middle ground for people who are great people eager to work in the legal field, but for whom a somewhat “lesser” degree than a J.D. might be more appropriate? I think so. Initiatives such as those by the Bill and Melinda Gates Foundation are underway to support community college and other students. Diversity is a benefit! This goes for the educational sector as well.
Tuesday, September 24, 2019
(Part 1 of this multi-part post is available here).
(Part 2 of this multi-part post is available here).
(Part 3 of this multi-part post is available here).
Adapted from Mark Edwin Burge, Access to Law or Access to Lawyers? Masters Programs in the Public Educational Mission of Law Schools., 74 U. Miami L. Rev. __ (forthcoming 2019), available here or at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3420457 (footnote numbering changed).
Course Design Principle #3: Prefer practical reality over theory.
While the principal of avoiding simulated law practice is rich in specifics, the admonition to “prefer practical reality” is at a high level of generality. Most legal academics will intuitively understand what it means, even those who involuntarily bristle at such advice. To be clear, the principle of focusing on operational legal reality is not a knock on legal theory, which has—and should have—a valued place in the education of future lawyers, and this is true whether we define theory as “a doctrinal theory explaining a case or series of cases, a school of jurisprudential thought, or a perspective on examining and understanding the law.” A grounding in big-picture theoretical understanding of the law is part of the value added that lawyers bring to the table, whether that be the ability to develop a creative argument or to recognize policy tradeoffs inherent in taking a certain legal position. In these arenas and in applying broad-based theoretical knowledge, the attorney truly earns the appellation of counselor, a title law faculty should aspire to develop thoroughly in their J.D. students.
Once again, however, the issue is that the purposes and aspirations of a legal masters student are not those of a future lawyer. The overarching goal is to be a legally-informed professional in career frequently adjacent to the law, such as risk management, contract management, and human resources. If we take career application seriously in a legal masters program as we should, then that means shifting course resources into practical reality. How might that look in practice? A legal masters course in the doctrinal law of contracts provides examples for applying the “prefer practical reality” principle, even though the practical differences will certainly vary among subjects.
A contracts course that is more focused on real-world application will tend to minimize time spent on offer and acceptance. The question of what theoretically should or should not qualify as a contract is an interesting one, raising questions of the proper role of government in enforcing private agreements and of drawing the line between gratuitous promises and enforceable ones. In the vast majority of real-life commercial settings, however, offer and acceptance far less than the broader principle of mutual assent, of which offer and acceptance is merely a species. Where assent to a negotiated contract is effectively simultaneous, the question of who went first will matter very little. Suggesting that offer and acceptance can be minimized certainly does not mean it will be eliminated. Factual scenarios invoking the common law mirror-image rule and its infamously divergent counterpart, the Uniform Commercial Code “battle of the forms” have substantial consequences for the content of an agreement and deserve coverage. Most bar-exam nuances of whether a statement actually is an offer or an acceptance do not deserve more than a passing glance. The disappointing but unquestioned reality for those of us who teach contracts is that no one is going to offer you $100 to walk across the Brooklyn Bridge.
Similarly inconsequential is the doctrine of consideration, at least beyond the basic proposition that a promise must generally be exchanged for something of legal value to be enforceable. The overwhelming majority of commercial transactions—even those involving consumers—do not raise questions of consideration because there is little doubt that promisor is receiving something valuable and not promising a gift. For a legal masters student, a comparatively swift treatment of illusory promises (no legal value and therefore no contract) and promissory estoppel (no legal value but the promise enforced to avoid injustice) could suffice. Peppercorns and bargain theory certainly have pedagogical value, but that value is most appropriately realized in the J.D. version of the contracts course.
If topics like offer, acceptance, and consideration can get the short shrift, then what deserves the full scale treatment? An evaluation of doctrine that has more real world application would surely have the parol evidence rule near the top of the list. The legal suppression of prior and contemporaneous statements from the negotiations leading up to contracting is enormously consequential to real-life commercial contracting, both in its ultimate substance and also as a cautionary tale about how and why the ultimate written agreement matters. Also, contract interpretation deserves the full-force treatment. When private parties reach a point of dispute in their transaction, someone at some point is going to read the contract, in many cases well in advance of the involvement of counsel. Empowering these parties with an early chance to perceive the legal layout of the land is a good thing. Finally, no area of contract law is more client-consequential than the law of remedies. Future clients are well-served by understanding the foundations of what the are getting—or losing—in the event of a breach of contract.
The illustrative use of contract law here is more a thumbnail sketch than a completed portrait, but it makes the point. Legal masters courses are not watered down versions of their J.D. counterparts, but they are rebalanced in favor of practical reality in topic allocation. In contract law, subjects like the parol evidence rule, interpretation, and remedies are amongst the most challenging for students. Their preference here, thus, is not because they are easy. They certainly are not. Rather, the topics are meaningful for career professionals who become legal masters students because they will more likely have cause to use them. Probable use should be a touchstone for course topic emphasis in legal masters programs.
The three principles discussed in this series—focusing on structural legal literacy, shifting problems to simulated client practice, and preferring practical reality in instructional allocation—highlight the ways in which a course serving legal masters students must differ from a J.D.-only course. The differences are critical if the courses are to be successful in leading toward masters-appropriate student learning outcomes. Achieving the course outcomes should, in turn, ultimately result in successful programmatic outcomes where the two sets of outcomes are properly aligned. At the program level, law school masters programs are bringing substantial and functional legal literacy to professionals whether they are executives, managers, bankers, consultants, or entrepreneurs. The program objectives for legal masters degrees should build on the strengths of what legal education does, but that does not mean it is doing the exact same thing that it does for J.D. students.
The future could be quite bright for legal masters programs aimed at working professionals who interact with the law but do not seek to practice law. That bright future will only come about, however, with intentional program and course design that meets the educational goals and needs of legal masters students. All design should lead to access to law. Even when sharing space in a J.D. classroom, masters students deserve much more than to be a J.D. afterthought.
 Peter Toll Hoffman, Teaching Theory Versus Practice: Are We Training Lawyers or Plumbers?, 2012 Mich. St. L. Rev. 625, 627 (2012) (internal footnotes omitted).
 See Jeffrey M. Lipshaw, What's Going on? The Psychoanalysis Metaphor for Educating Lawyer-Counselors, 45 Conn. L. Rev. 1355, 1362 (2013) (asserting that “great lawyers as counselors seek out the interdisciplinary overlap and are comfortable operating within it.”); Michael Sullivan, The Lawyer As Counselor in an Age When Lawyers Are More Specialized and Task Focused, Do Clients Truly Receive Legal Counsel?, 76 Def. Couns. J. 253, 256 (2009) (“The Counselor is a value added attorney for the client.”).
 See generally Restatement (Second) of Contracts §§ 17 - 70 (1981) (collecting common law rules on the establishment of mutual assent to contract, most frequently through the process of offer and acceptance).
 See id. §§ 58 - 59 (stating that an effective acceptance must comply with the terms of the offer and be without qualification).
 See U.C.C. § 2-207 (2018) (describing—somewhat inartfully—circumstances under which an acceptance can deviate from the terms of an offer and nonetheless successfully form a contract for the sale of goods.).
 Mark B. Wessman, Is "Contract" the Name of the Game? Promotional Games As Test Cases for Contract Theory, 34 Ariz. L. Rev. 635, 647 (1992) (recounting how contracts professors have “generated hours of classroom debate over the proper treatment of offers of money in return for a stroll across the Brooklyn Bridge when the offeror revokes while the hapless offeree is halfway to Manhattan”). The hypothetical originated with Professor Maurice Wormser. See I. Maurice Wormser, The True Conception of Unilateral Contracts, 26 Yale L.J. 136, 136 (1916).
 See generally Restatement (Second) of Contracts §§ 71 – 109 (collecting rules of the common law related to the necessity of consideration or a substitute for consideration as a prerequisite of contract formation).
 See id. § 77 (“Illusory and Alternative Promises”).
 See id. § 90 (“Promise Reasonably Inducing Action or Forbearance”).
 See id. §§ 209 – 218 (collecting legal principles collectively known as the “parol evidence rule” along with its major exceptions).
 See generally id. §§ 200 – 204; see also Frigaliment Importing Co. v. B.N.S. Int'l Sales Corp., 190 F. Supp. 116, 117 (S.D.N.Y. 1960) (illustrating contract interpretation principles with a famously robust evaluation of the question, “[W]hat is chicken?”).
 Accord V. Pualani Enos, Lois H. Kanter, Who's Listening? Introducing Students to Client-Centered, Client-Empowering, and Multidisciplinary Problem-Solving in A Clinical Setting, 9 Clinical L. Rev. 83, 84 (2002) (asserting in another context that “[c]lients dealing with complex and multidimensional problems need service providers who approach problem-solving in a way that is client-centered [and] client-empowering”).
 Accord Michael P. Allen, Remedies As A Capstone Experience: How the Remedies Course Can Help Address the Challenges Facing Legal Education, 57 St. Louis U. L.J. 547, 557 (2013) (“[D]ecisions about what remedies to seek in a given context require lawyers to truly engage with their clients.”).
 Accord Joshua M. Silverstein, Using the West Key Number System As A Data Collection and Coding Device for Empirical Legal Scholarship: Demonstrating the Method Via A Study of Contract Interpretation, 34 J.L. & Com. 203, 259 n.314 (2016) (“If the drafters of the Restatement were this confused, it should not be surprising that generations of courts, lawyers, and law students have struggled with the principles of contract interpretation and the parol evidence rule.”).
Sunday, September 22, 2019
A sexual investigation was launched against male student “John Doe” of Columbia College of Chicago (“Columbia”) after a female accused Doe of non-consensual sexual relations. A formal investigation and a hearing led to Doe being suspended from Columbia for an academic year. Doe then filed suit in federal court alleging, i.a., Title IX violations and that Columbia had breached its contract with him by not providing him with an impartial investigation and adjudication of the matter. He also asserted that he did not get access to the documentation relating to his hearing, that Columbia failed to discipline female individuals who engaged in similar conduct, and that the hearing panel’s decision was against the weight of the evidence.
The trial and appellate courts both pointed out that Illinois courts have expressed a reluctance to interfere with academic affairs and have held that a student’s breach of contract claim must involve decisions that were arbitrary, capricious, or made in bad faith. Thus, Columbia would not even have been liable if the court had found that it exercised its academic judgment unwisely; rather, it must have disciplined a student without any rational basis. This was not the case here.
Doe had had a chance to review the documentation, it was found. Further, Columbia was not arbitrary or capricious in its response to Doe’s complaints about female students: they responded quickly, investigated, handled his complaints, and encouraged him to inform the university if any further incidents occurred.
In other words, the burden in such cases is high. To find in the student’s favor, the courts must find that the university “did not exercise its academic judgment at all, instead acting arbitrarily or in bad faith in its treatment of plaintiff.”
This outcome was probably warranted in this case and the reaffirmation of the standard welcome to educational institutions. On the other hand, I find it slightly disturbing that, under better facts, a student’s contractual rights and arguments could not be given any weight even if the student could show that the university “exercised its academic judgment unwisely” or “at all”? Of course, as law professors, we are aware of the difficulty it can be to deal with students who may be complaining about something out of emotional issues with their grades or the like. However, just because a student is a student and, of course, protected by federal civil rights law does not mean that the student may not have a valid contractual argument. As we know from extensive media discussions about the expense of going to college modernly, does it make sense from a contracts law point of view to say that the students cannot prevail with a contract claim even if the university exercised its judgment unwisely? - Is the latter not exactly what you pay a university for?
Of course, these issues intersect with constitutional law, which must be followed. But the standard is somewhat troubling under some circumstances, I think.
The case is Doe v. Columbia College Chicago, 2019 WL 3796000.
Thursday, September 19, 2019
Teaching Contract Law (and More) to Legal Masters Students - Part 3: Avoiding the Simulated Law Practice Paradigm
(Part 1 of this multi-part post is available here).
(Part 2 of this multi-part post is available here).
Adapted from Mark Edwin Burge, Access to Law or Access to Lawyers? Masters Programs in the Public Educational Mission of Law Schools., 74 U. Miami L. Rev. __ (forthcoming 2019), available here or at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3420457 (footnote numbering changed).
Course Design Principle #2: Avoid premising problems and writing assignments on simulated law practice.
Legal masters programs typically accept the proposition that writing and are a need and a value within the curriculum. The value exists both where courses are primarily skills oriented and also where writing is a method of formative assessment in a principally doctrinal course. This noncontroversial premise can lead to difficulty in its execution. The baseline starting point for many law schools’ curriculum development in the area of analytical writing skills, not surprisingly. is that with which they are already familiar: the 1L legal research and writing course that already exists in some form in every J.D. program in the United States. That legal analysis and writing course is quite appropriately grounded in expressing the application of actual law to simulated facts in a setting where students play the role of a lawyer. Writing assignments in doctrinal courses, while usually not playing as dominant a course role as their skills-course counterparts, nevertheless follow the same paradigm. The problems are premised on assuming the role of a lawyer who is practicing law.
Simulated law practice is the problem. The crucial value added in a J.D. course setting is, in fact, a distraction to the masters students, sometimes to the point of detriment. Why would this be so? The programmatic and course outcomes for masters students do not contemplate their representation of clients. Time and instruction spent on the underlying assumption of taking on the lawyer’s role undermines the developing professional identity of the affiliated non-lawyer professional by, in effect, forcing it through a level of translation. While students whose goals include taking the bar exam and representing clients are well-served by assignments prompting the imagination of themselves in the role of the attorney, other professionals are not. If we in legal education believe, as we certainly should, in the crucial role that J.D. legal education plays in formative professional development, then recognizing the need for analogous development of the professional identity of legal masters students is but a small step.
A related and ever-present issue in a legal masters program is discouraging the unauthorized practice of law. A well-designed program will build in training and frequent cautioning against unauthorized practice of law throughout the curriculum. Perhaps the most important aspect of any such training, however, is repeated emphasis on the bright-line prohibition against non-lawyers taking on or advising clients on legal matters. All United States jurisdictions share this rule in some fashion, despite their variance on numerous other questions of what does and does not qualify as unauthorized practice. Accordingly, a further problem with the pedagogy of simulated law practice is that it actively engages legal masters students in doing the one thing above all others that they are expressly prohibited from doing.
If the lens of simulated law practice is where a fundamental disconnect occurs between masters curriculum and its students, then it requires a pedagogical replacement to fill the hole in problem analysis and legal writing. Though the replacement lens could take several possible forms, the most useful descriptive category is simulated client practice. What would such a simulation look like and what would it seek to elicit from the student? Consider three examples from the Legal Analysis and Writing for Clients (LAWC) course at Texas A&M. In all three examples, goals include the teaching of legal concept and communications, but doing so from the perspective of a client rather than a lawyer.
The first LAWC example is tied to the course unit covering basic legal analysis and introducing, by example, the traditional legal memorandum. The memo, however, is not the end goal; rather, it serves as an illustration of the paradigmatic means by which lawyers document and support their analysis of a legal problem. The unit is tied to understanding why lawyers do what they do, and, most critically, recognizing work product in which lawyers are employing traditional analysis, such that a client can be empowered to take predictive analysis into account.
The summative assignment for this unit involves giving the student a legal case file, much like in a 1L course, except that the case file already includes what would be the J.D. course final product—a predictive memorandum. And that is because the actual assignment is still to come. Accompanying the case file is the actual assigning memorandum, which is addressed—not to “Junior Associate” at a law firm—but the “Assistant Risk Manager” at the client company. The risk manager must read the case file, the legal memorandum, and additional facts regarding the company’s business situation. These documents form the basis the ultimate assignment: Write a report to a supervisor that (1) summarizes the legal findings, (2) summarizes the business situation, and (3) makes recommendations for the company in light of the combination of both the legal analysis and the business reality. The legal prediction and the business facts frequently do not point the same direction. For example, a memorandum predicting that the client company could win a breach of contract lawsuit may ultimately be offset by the probable negative impact of burning the business relationship with the prospective defendant. Ultimately, the legal masters student is accounting for the lawyer’s role, but is accomplishing something quite different with her report.
A second example from the LAWC course arises from a unit on understanding common and foundational litigation documents, particularly pleadings and motions. In the underlying simulation, the students are given access to selected documents from the docket of an actual case. For federal court cases, the raw PDF documents are available through the PACER, which most legal educators can access through Bloomberg Law. The real case is not random, of course, but is one selected for its relevance and application to the final project, which is (again) an internal company report. Out of the wealth of real and comparatively recent federal cases that are no longer active, the instructor should select and carefully curate one involving a business dispute and parties that can serve as background for a new simulation.
Consider, for the present description, the use of a breach of warranty lawsuit regarding the quality of commercial building supplies. For the new assignment hypothetical, the company employing the masters students as risk managers happens to have a similar problem with the seller who is a defendant in the previous litigation. Upon learning that the seller had been sued before, the company president obtains the key lawsuit documents from the longtime outside counsel, who provides them as a favor to a valued client. The president then tasks the risk manager (the student) with reviewing the documents and preparing a report in light of information about the company’s present situation involving the same seller. The report assignment requires the student to provide (1) a summary of the underlying dispute from the prior litigation, (2) a summary of what—procedurally—occurred in the prior litigation, and (3) an identification of potential problems that may arise in a new lawsuit against the seller. In essence, the students are required to demonstrate literacy in litigation documents sufficient to recognize possible business concerns and cautionary tales. In one version of this assignment in the Texas A&M program, the students could discern that the seller operates as several, similarly-named entities, some of which were not subject to the court’s personal jurisdiction. The students could also report on potential causes of action from the previous litigation. In the end, the students are able to make a low-cost evaluation of their company’s situation in advance of incurring the cost of bringing in outside counsel—a worthwhile contribution to the cause of client autonomy. Once again, the purpose of the assignment is not to simulate the role of the lawyer; rather, the goal is to simulate the role of a legally-literate business professional—a potential client in the making.
The third assignment example from the LAWC course at Texas A&M involves contract drafting; more specifically, it involves the intersection of contract drafting and working effectively with lawyers. The assignment is, again, not directed to a junior attorney, but to a company “Contracting Officer” who is provided the details on either a preliminary deal or an area in which her employer needs to create a form contract. In initial substance, the assignment packet has much in common with what one might find in a J.D. contract drafting course. In the lead-up to the assignment, the students receive instruction in contracting literacy, including typical document structures, purposes and examples of boilerplate, and methods of presenting substantive terms. The shift away from the J.D. framework comes in the ultimate assignment. The students are provided with specific business goals and concerns that the company wants dealt with in the final contract, and the student assignment is to prepare an annotated first draft contract to be sent to the company’s general counsel. “First draft” in this context does not mean a rough draft. It means a polished product that is nonetheless understood to be a precursor to the final product. Perhaps the most important aspect of this document is that it is annotated. What does annotated mean in this assignment? The comment-bubble notes are (1) explanations of why the initial drafter did what she did, and (2) questions for the general counsel that arose in the drafting process.
For learning purposes, the annotations are more important to this assignment than is the actual contract text. The masters students are achieving two critical learning outcomes with this assignment. First, they are developing legal literacy with regard to working in and around contract documents. Business decision makers ought to be able to understand the private-law agreements to which they are or might be bound. Contending otherwise is antithetical to the purpose of private law autonomy, which is empowering parties with a modicum of legal control over their own destinies. Second, the students are developing the skill of effective collaboration with lawyers, a skill that involves and requires a recognition of when and how to ask questions. Legal issues do not always show up on a company’s doorstep in the prepackaged form of a citation and summons. The contract-creation assignment provides an opportunity for initial issue spotting by the client at a far more subtle level, empowering the client with greater facility in knowing when to bring in a lawyer.
All three of these example assignments teach legal-interaction skills but do not place them in the developmentally counterproductive context of simulating the practice of law. The replacement model is simulated client practice. Legal masters programs should not only address students where they are, but courses should be constructed around the imagination of where they will be. Although these examples are drawn from a skills course, their underlying philosophy should impact a doctrinal course as well. The problems and hypotheticals grounded in a call of the question like, “How would you advise your client?” should be replaced with the client-side perspective, ranging from “What legal risks concern you here?” to “What would you do?” realizing that answers to the latter question will more than occasionally include the phrase, “I’d consult a lawyer regarding . . . .”
 See ABA Standards and Rules of Procedure for Approval of Law Schools 2018-2019, Standard 303(a)(2), https://www.americanbar.org/content/dam/aba/publications/ misc/legal_education/Standards/2018-2019ABAStandardsforApprovalofLawSchools/2018-2019-aba-standards-chapter3.pdf (requiring that the J.D. program of legal education at an ABA-accredited law school include “one writing experience in the first year and at least one additional writing experience after the first year, both of which are faculty supervised”).
 William M. Sullivan et al., Educating Lawyers: Preparation for the Profession of Law 185-203 (2007). See also William M. Sullivan, After Ten Years: The Carnegie Report and Contemporary Legal Education, 14 U. St. Thomas L.J. 331, 334 (2018) (advocating greater support by law schools in training future lawyers by “providing entrants to the field effective ways to engage and make their own the ethical standards, social roles, and responsibilities of the profession, grounded in the profession's fundamental purposes.”).
 See Leonor E. Miranda, Finding A Practical Solution to Bridging the Justice Gap for Immigrants in the United States, 30 Geo. Immigr. L.J. 163, 183 n.135 (2015) (“All 50 states have rules and laws prohibiting the unauthorized practice of law, mainly to protect consumers. Non-lawyers are generally prohibited from practicing law; however, what constitutes the ‘practice of law’ or the ‘unauthorized practice of law’ is by no means uniform, even within the same jurisdictions[.]”) (internal quotation marks omitted).
 Although it is a comparative latecomer to the commercial online research arena, Bloomberg Law has carved a recognized niche in its expansion of academic access to federal court dockets and documents. See, e.g., UCLA School of Law Hugh and Hazel Darling Law Library, Dockets and Court Documents in Bloomberg Law: Getting Started, https://libguides.law.ucla.edu/dockets (“Bloomberg Law is an excellent alternative to PACER. It provides access to all dockets available in PACER, and there is no charge to search dockets or to retrieve court materials from Bloomberg Law.”).
 Accord Anthony J. Sebok, What Do We Talk About When We Talk About Control?, 82 Fordham L. Rev. 2939, 2959 (2014) (“[T]he fear that nonlawyers will use control to influence the reasons that clients receive concerning legal decisionmaking, while genuine, needs to be balanced against client autonomy: loyalty to clients may require lawyers (and nonlawyers) to allow clients to hear opinions from whomever the client chooses.”).
 See, e.g., Tina L. Stark, Drafting Contracts: Why Lawyers Do What They Do (2d ed. 2014).
 Perhaps oddly, this situation is analogous to legal writing practices that predominated among many lawyers before the widespread adoption of word processing technology. See Lucia Ann Silecchia, Of Painters, Sculptors, Quill Pens, and Microchips: Teaching Legal Writers in the Electronic Age, 75 Neb. L. Rev. 802, 846 (1996) (“A legal writer in this earlier environment would be concerned primarily with ensuring that a first draft was relatively polished, given the practical difficulties in editing. . . . A lawyer in the pre-electronic age would, most likely, write with the expectation that there would be less rewriting and revision than is possible today.”).
 Cf. Mark Edwin Burge, Too Clever by Half: Reflections on Perception, Legitimacy, and Choice of Law Under Revised Article 1 of the Uniform Commercial Code, 6 Wm. & Mary Bus. L. Rev. 357, 380–81 (2015) (“Proponents of choice-of-law autonomy thus find it foundational that in the absence of third-party effects, the parties to the transaction should be permitted to choose the applicable law through contract without reference to any limiting test. In this view, law is not and should not be different from any negotiated and fully private contract term: let law be part of a marketplace.”) (internal cites and quotations omitted).
 Such empowerment on the client side would also arguably support a client-centered approach to representation by the lawyer. See Katherine R. Kruse, Beyond Cardboard Clients in Legal Ethics, 23 Geo. J. Legal Ethics 103, 127 (2010) (describing the client-centered approach as “directly responsive to the problem of legal objectification” in that it “urges lawyers to unlearn the professional habit of ‘issue-spotting’ their clients and to approach their clients as whole persons who are more than the sum of their legal interests.”).
Monday, September 16, 2019
Teaching Contract Law (and More) to Legal Masters Students - Part 2: Focus on Structural Legal Literacy
(Part 1 of this multi-part post is available here).
Adapted from Mark Edwin Burge, Access to Law or Access to Lawyers? Masters Programs in the Public Educational Mission of Law Schools., 74 U. Miami L. Rev. __ (forthcoming 2019), available here or at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3420457 (excerpt footnotes omitted).
Course Design Principle #1: Focus legal text comprehension on structural legal literacy.
Understanding the general meaning and structure of legal texts—especially cases, statutes, and regulations—is a critical goal for professionals who will deal with lawyers or be the first line of defense for an organization’s legal compliance. The baseline level of this comprehension should be structural legal literacy—a broad-based ability to recognize and identify a legal text’s design features. For cases, this recognition would cover judicial rule statements, analogies to precedent, and ultimate holdings. For statutes and regulations, the identification of elements, factors, and code-defined terminology (such as definitions) would likewise be a core competency. Such parsing of legal text is an early focus of J.D. legal education, but there it builds out toward more advanced concepts like the temporal development of common law and the discernment of legislative intent. For masters students, the structural comprehension is not merely a means to other ultimate goals; rather, it is itself an ultimate goal.
That distinction between being an end rather than a means to an end is a substantive one: It impacts fundamental pedagogy. Most significantly, the signal, historical pedagogy of legal education—the Socratic method—is ill-advised for masters-type legal education. As others have observed in the J.D. context, Socratic method has some significant educational value, but it is inefficient for teaching the law. Indeed, the Socratic method’s purpose, in the very real articulation of the famous-but-fictional Professor Kingsfield, is not to teach the law, but rather to train students to think like a practicing lawyer. While “thinking like a lawyer” is a time-honored and worthy goal in the halls of the legal academy, it is inapposite for students in a program that, by definition, is not designed to turn them into lawyers.
In the masters program setting, accordingly, the primary purpose of reading a case involving contract law primarily is to learn the contract law—both in its abstract, black-letter sense (the rule) and in its applied-example sense (the immediate story of how the rule operates). The top-level goal is not to discern procedural nuances and the murky role of dicta, nor is it to construct the historical development of doctrines like consideration or promissory estoppel. Consequently, the students would seldom benefit from “hide the ball” type classroom engagements as those detract from the principal task of top-level legal literacy. Likewise, the study of statutes or regulations requires focus on navigating and discerning the meaning of rule texts, including integrated codes. It can rightfully exclude excessive focus on ambiguity, drafting errors, and legislative history. Hypotheticals directed toward teasing out absurd results of statutory canons may well be fun, but they are beside the point. A non-lawyer needs a working level of comfort with assimilating legal texts, the vast majority of which whose meaning is not in both serious and consequential question. The more complex—and frankly more rare—arguments over legal meaning can (and should) be brought to the lawyers.
[Continued in Part 3]
Friday, September 13, 2019
Teaching Contract Law (and More) to Legal Masters Students - Part 1: Principles of Masters Course Design
Adapted from Access to Law or Access to Lawyers? Masters Programs in the Public Educational Mission of Law Schools., 74 U. Miami L. Rev. __ (forthcoming 2019), available here or at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3420457.
The general decline in J.D. law school applicants and enrollment over the last decade has coincided with the rise of a new breed of law degree. Whether known as a master of jurisprudence, juris master, or master of legal studies, these graduate degrees all have a target audience in common: adult professionals who neither are nor seek to become practicing attorneys. Inside legal academia and among the practicing bar, these degrees have been accompanied by expressed concerns that they detract from the traditional core public mission of law schools—educating lawyers. This article argues that non-lawyer masters programs are not a distraction from the public mission of law schools, nor are they a necessary evil foisted upon legal education by economic trends. Rather, such degrees reflect a paradigm shift that law schools and attorneys should embrace rather than resist: a move away from law being largely accessed primarily through a licensed elite and toward a greater role for autonomy in public engagement with the legal system. The law school function of serving the public goes well beyond training future lawyers or even marshalling them in the advance of access to justice. The expanded legal education vision advocated here includes those functions, but as part of a more encompassing mission: ensuring access to law rather than simply access to lawyers. This article then sets forth foundational frameworks for such programs to succeed at their goals, both at the programmatic level and at the course-design level.
From the Article (footnotes omitted):
Like the article as a whole, this consideration of course design is informed by the author’s own experiences, victories, and defeats on the instructional battlefield. The examples here are principally drawn from two courses. The first of these is Contracts, a doctrinal staple of the J.D. curriculum that I have taught in in three forms: the fully-J.D. format, the mixed J.D.-and-masters format, and the masters-only format. The second course is one styled Legal Analysis and Writing for Clients, a masters-only course created as an adaptation of J.D. lawyering-skills and legal writing curriculum for the needs of working professionals. Both courses have played important roles in bringing me to the viewpoints expressed here regarding how masters students should be accounted for in course design as compared to their J.D. counterparts.
The specific topical coverage of any law course can be as varied as the doctrine and skills encompassed by law itself. For that reason, the focus of this section is on principles of masters course design rather than bright-line rules. Any attempt at stating hard-and-fast requirements for masters courses as compared to their J.D. counterparts is certain to face death by counterexample. Something will inevitably not fit within the rigid rules. For that reason, a principles-based approach is the preferable way to conceive of course design in this space, recognizing that aspiration must have the flexibility to give way to reality. General principles are critical, however, to answering the specific questions faced by law school masters programs. The following three principles, while hardly an exclusive list, state tendencies that will best align masters courses with their appropriate programmatic outcomes, which in turn will fulfil the expanded law school public mission advocated by this article:
(1) Focus legal text comprehension on structural legal literacy.
(2) Avoid premising problems and writing assignments on simulated law practice.
(3) Prefer practical reality over theory.
The remainder of this section addresses each of these principles with a goal of illustrating how they might look in practice.
[Continued in Part 2]
Saturday, July 6, 2019
A recent case out of the Southern District of Ohio, The Devine Group, Inc. v. Omni Hotels Corp., Civil Action No. 1:18-cv-186 (WOB) (behind paywall), is a fairly straightforward contract interpretation case with a good parol evidence discussion. The court finds that the contract is unambiguously worded and so refuses to look to any extrinsic evidence. If you're looking for a contract clause example to use in class, this might be a good one.
Monday, June 24, 2019
I just blogged about a consideration case last week, and now here's another one out of Illinois, Johnson v. Illinois Alcohol & Other Drug Abuse Professional Certification Association, Nos. 4-18-0562 4-18-0575 cons (behind paywall). This case concerns an at-will employment contract that was later modified to include a definite retirement date. The defendant argues that there was no consideration for this modification of the contract, and thus it's not binding. However, the court notes that Johnson gave up his ability to work for the defendant beyond the retirement date and that that served as consideration for the modification of the employment contract. There were also some changes in job duties and title as well as an additional agreement reached on how sick and vacation days would be used over the remainder of the employment term. All of this was sufficient to show that both parties bargained for things from the other in this new binding contract.
Wednesday, June 19, 2019
Continuing the theme of thinking about fall courses, a recent case out of the Western District of Washington, Phytelligence, Inc. v. Washington State University, Case No. C18-405 RSM (behind paywall), has a discussion about both extrinsic evidence and agreements to agree -- both topics my students often struggle with. Might be worthwhile to take a look at this recent analysis, especially if you teach in Washington.
Monday, June 17, 2019
If you've already started thinking about gathering examples for your courses this fall, here's a consideration case for you out of Ohio, Forbes v. Showmann, Inc., Appeal No. C-180325. Forbes was an employee of Showmann, and at a holiday party Showmann gave its employees, including Forbes, raffle tickets. One of the prizes was what sounds like a pretty sweet cruise package, and Forbes won the cruise. Showmann terminated Forbes's employment a few weeks later and informed Forbes that the cruise package was conditioned on Forbes still being a Showmann employee when she took the cruise.
Forbes sued for breach of contract but the problem was that it was undisputed that Forbes did not pay for the raffle ticket. Showmann simply distributed the raffle tickets for free to its employees. Therefore, there was no consideration with which to form a contract. Forbes tried to argue her employment by Showmann was the consideration for the ticket but Forbes's employment was not used to bargain for the raffle ticket in exchange, so therefore there was no contract.
If you feel bad for Forbes, which I admit I kind of did based on these given facts, her conversion claim does survive, so there is some hope for her.
Monday, April 22, 2019
Don't just stand there, let's get to it: Second Circuit orders payment of "Vogue" royalties (aside, I hadn't listened to "Vogue" in a while, and it totally started my week off right!)
A recent case out of the Second Circuit, Pettibone v. WB Music Corp., 18-1000-cv, caught my eye because I teach the underlying copyright dispute driving this contractual dispute. You can listen to the case's oral argument here.
Pettibone composed the song "Vogue" with Madonna and entered into a contract with Warner where Warner collected the royalties for the song and split them with Pettibone. In 2012, Pettibone and Warner were sued for copyright infringement. They each had their own counsel and each bore their own costs in successfully defending the lawsuit, both in the trial court and on appeal. (You can read the appellate court decision here. We talk about it in my Transformative Works and Copyright Fair Use class when we do a unit on music.)
After the conclusion of the copyright suit, Warner withheld over $500,000 worth of royalties from Pettibone, claiming that under Section 8.1 of the agreement between Warner and Pettibone, it was allowed to withhold the royalties to pay for its defense of the copyright infringement suit. Section 8.1 read in part, "Each party will indemnify the other against any loss or damage (including court costs and reasonable attorneys' fees) due to a breach of this agreement by that party which results in a judgment against the other party . . . ."
Pettibone sued, arguing that he had never breached the agreement and therefore Section 8.1 did not permit Warner to withhold any royalties. The district court found that Section 8.1 "unambiguously requires Pettibone to indemnify Warner for the attorneys' fees and costs," and dismissed Pettibone's complaint.
In another example of ambiguous understandings of ambiguity, the appellate court here reversed the district court's holding, instead finding that Section 8.1 is "pock-mocked with ambiguity." In the Second Circuit's opinion, a better reading of the section was that, if there was no breach, each party should carry its own attorneys' fees and costs. In fact, Section 8.1 went on to read that "each party is entitled to be notified of any action against the other brought with respect to [the song 'Vogue'], and to participate in the defense thereof by counsel of its choice, at its sole cost and expense" (emphasis added). A fair reading of the section, the Second Circuit said, was that it required Pettibone to indemnify Warner if Pettibone breached the contract, but not otherwise.
Warner was the party that drafted the contract, and could easily have stated that indemnification happened in the event of any allegations, not just any breach. That was not, though, how the contract was drafted.
The effect of Warner's argument would be to shift a million dollars' worth of attorneys' fees onto Pettibone, just because there was a lawsuit, "regardless of merit or frivolousness." The Second Circuit found that to be "an extraordinary result" not justified by the section's ambiguous language. Therefore, the Second Circuit ordered reversal of the district court's dismissal, judgment for Pettibone, and calculation of the royalties improperly withheld from Pettibone, as well as consideration of Pettibone's request for attorneys' fees in connection with the instant action and appeal.
Monday, April 1, 2019
When I teach express conditions, we talk a lot about the language that you use to create them. A recent case out of the Northern District of Ohio, Health and Wellness Lifestyle Clubs, LLC v. Raintree Golf, LLC, Case No. 1:17CV2189 (behind paywall), has some examples. The agreement in question read that it was "contingent upon Purchaser's obtaining and delivering to Seller a written unconditional commitment or commitments," and continued that "the obligations of Seller to consummate the transaction . . . shall be subject to the fulfillment on or before the date of Closing of all of the following conditions," both of which created an express condition that a written unconditional commitment needed to be delivered. Because there was never any such written unconditional commitment in this case, the dependent obligations never became due.
Sunday, March 31, 2019
Reformation is one of those doctrines that I love to have class discussions over, really interrogating when (and whether) courts should employ it. A recent decision out of Delaware, In re 11 West Partners, LLC, C.A. No. 2017-0568-SG, has a nice reformation discussion in clear, straightforward language that I think could be useful in class. I especially like the Court's remarks about "the conclusions of social scientists and psychologists that witnesses may come to believe in factual scenarios beneficial to them . . . ." It's a gentle and sympathetic decision regarding "honorable" men whose recollections of the truth all differ.
h/t to Eric Chiappinelli at Texas Tech for forwarding us this case!
Tuesday, December 18, 2018
A past consideration case reminds us that being recognized for your past hard work isn't good for your breach of contract claim
I don't know about everyone else but my casebook teaches past consideration using very old cases. Here's past consideration raised as an issue with a recent case out of the Southern District of California, Wright v. Old Gringo Inc., Case No. 17-cv-1996-BAS-MSB (behind paywall).
The case is really interesting, because the court acknowledged that the complaint had proper consideration allegations: ownership interest, salary, and performance bonuses in exchange for providing "expertise and services." The problem came from the deposition testimony, all of which seemed to establish that in fact the ownership interest had been provided as a reward for previous work. The plaintiff herself testified that the ownership interest was effective even if she immediately quit the job, indicating it wasn't in exchange for future services. Plaintiff's friends and relatives provided similar testimony, that the ownership interest was given "to show . . . appreciation" and "for . . . recognition of her hard work." There was no evidence presented that the ownership interest was offered on the condition of future work in exchange. For that reason, the court granted summary judgment for failure of consideration.
The plaintiff's remaining claims were permitted to go forward, including promissory estoppel and tort claims. Those claims (as I remind my students!) don't require consideration.
I find this case really interesting because I'm sure the plaintiff's friends only thought they were helping her with their testimony. This is the kind of thing that I think makes instinctive sense to non-lawyers: the plaintiff did something awesome and they recognized it by giving her an amazing gift. But lawyers know that consideration doctrine makes that a bad thing, not a good one.
(The decision also contains a statute of limitations and damages discussion.)
Friday, October 12, 2018
I just gave a midterm in my contracts class, which is always so useful to crystallize the places where the students are having consistent understanding issues. For me this year, one of the tricky parts seems to be the statute of frauds, so it was nice to see this recent case out of the Eastern District of Wisconsin, Northern Group, Inc. v. Tech 4 Kids Inc., Case No. 17-C-1367 (behind paywall), that deals with a fairly straightforward statute of frauds issue.
In the case, Northern Group alleged that the parties had an oral agreement for commissions for sales and brought causes of action related to the breach of this agreement. Tech 4 Kids argued that the claims should be dismissed, in part because the oral agreement should have been in writing under the statute of frauds. However, as the court noted, the statute of frauds does not require a contract to be in writing unless it cannot be performed within a year. While it was true that the sales agreements required to be formed to result in commissions under the contract could sometimes taje years to finalize, Northern Group could conceivably have arranged some sales agreements within a year. Moreover, the agreement was terminable at will by either party, so either party could have decided within a year not to continue with the arrangement. Therefore, the oral agreement was capable of being performed within one year and so was not void under the statute of frauds.