1992
February 1992 Question 1 [Trusts]
Tom is trustee of a trust created by Abe in 1996. The corpus consists of stocks and bonds worth $150,000, an apartment house appraised at $650,000 in a neighborhood which is becoming increasingly industrial, and a vacant lot. Yearly net income from the stocks and bonds is $12,000, and from the apartment house is $36,000. Tom has held the lot for five years, not wanting to sell it at a sacrifice because the uncertainty of zoning and the location of a proposed highway. The trust instrument directs Tom to pay the income from the trust to Abe for life and, at Abe’s death, to divide the corpus between Abe’s children, Ben and Cathy.
At the end of 2001, Tom sold the vacant lot for $50,000, the fair market value. He also sold some stocks for $35,000, realizing a $10,000 gain. Tom used this money along with $25,000 of accumulated rental income to build an addition to the apartment house.
In another 2001 transaction, Tom sold for $25,000 stocks that had been purchased for $25,000, and lent the proceeds to PQ Corp. at 1%, below the prevailing interest rate. The loan is secured by a first mortgage on unimproved realty worth $30,000. For several years, Tom has performed substantial services for PQ Corp. as a consulting engineer. He owns 100 shares of its common stock. There are 1,000,000 PQ shares outstanding.
1. Has Tom breached his duties as trustee and, if so, what are his liabilities to the beneficiaries? Discuss.
2. Has Abe received all the income to which he is entitled? Discuss.
February 1992 Question 2 [Constitutional Law]
In desert areas, wildlife use dry streambeds, commonly called washes , to move from one feeding location to another. Washes are therefore critical to wildlife survival in such areas. Puma County (County) in State X, with substantial desert areas, is concerned about preserving its washes in their natural condition to protect wildlife. To that end, County enacted an ordinance in 1988 that requires the preservation, in their natural condition, of all washes in specified desert areas within the county .
American National, Inc. (ANI) is a housing developer that has owned a 120-acre tract of land in one of the specified desert areas in County since 1985. Since 1980, County has also had a zoning ordinance that restricts development of the tract and surrounding area to not more than one house per acre. In late 1990, ANI filed with the County Planning Commission an application for development of the 120-acre tract, calling for the construction of 120 homes, each on a one-acre lot in the tract. However, because of the terrain, which includes two major washes, 17 of the proposed housing lots would be citable for building only if ANI took action to change radically the location and reinforce the banks of the two washes, in order to prevent flooding during heavy rains. This action would materially impeded wildlife mobility in the washes. The County Planning Commission ruled against ANI's application and the County Board of supervisors upheld the ruling.
ANI has filed an action against County in State X court. ANI seeks to compel County to grant it the right to build the 120 homes in accordance with its development plan or, in the alternative, to pay damages equal to the fair market value of the the 120-acre tract. ANI also seeks damages equal to the fair rental value of its land during the period between the filing of its development application with the Planning Commission and the decision in this lawsuit.
What rights under the United States Constitution should ANI assert in support of its claim for relief, and how should the Court rule? Discuss.
February 1992 Question 4 [Professional Responsibility] [Torts]
Amy’s Restaurant is located at the junction of State Highway and Rural Road. The only access to the restaurant from State Highway is via the Rural Road exit ramp. Builder, under contract with the State Highway Department for construction of roads and highways. In 1977 the Department, recently performed repair work on this exit, but did the work so poorly that a rainstorm washed out the exit, and the exit could not be used for a two-month period. As a result, Amy lost $25,000 in profits because travelers on State Highway could not get to Amy’s restaurant. In an unrelated transaction, Amy has acquired, by way of assignment, a valid $5,000 promissory note issued by Builder. The note is now past due. Builder has refused Amy's demand to pay off the note because all of his cash is tied up in $100,000 worth of steel reinforcing bar (rebar) that Builder needs for a highway bridge project. Lawyer has agreed to file a suit for negligence against Builder to recover Amy's lost profits and another suit to recover on the promissory note. Amy has instructed that, once the action is commenced on the promissory note, Lawyer should levy attachment on Builder's entire inventory of rebar. Amy claims that this will induce Builder to pay off the note and settle the lost profits suit since Builder will not be able to proceed with the bridge project if the rebar is tied up by an attachment.
1 . Does Amy have a valid cause of action in negligence against Builder for recovery of the lost profits of her business? Discuss. 2. If Lawyer follows Amy's instructions, will Lawyer: (a) incur any potential liability for malicious prosecution or abuse of process or both? Discuss. (b) have committed professional misconduct? Discuss.
February 1992 Question 5 [Civil Procedure]
Borrow, a resident of State A, obtained a $12,000 car loan from Finco. Finco is incorporated and has its principal place of business in State A. When Borrow began making installment repayments against the loan, he was dismayed
February 1992 Question 6 [Evidence]
Paul has commenced an action in intentional tort against Don, alleging injuries suffered from stab wounds inflicted by Don, and seeking damages. At the trial by jury, Paul was called as the first witness and the following questions were asked and answers given.
[Direct examination of plaintiff Paul]
Q: What is your name?
A: Paul Jones.
Q: Where do you live?
A: 637 Broadway, here in town.
[1] Q: And you've lived there for the past eight years?
A: That's right.
Q: What do you do for a living?
A: For the past four years, I've been the assistant dean at the College of Law.
Q: Directing your attention to January 11th of this year at about 8:00 a.m., where were you?
A: I was standing in the reception office of the law school.
Q: Tell the jury what happened when you were standing there.
[2] A: Well, the first thing I remember is that a student, Bonnie Brown, said, "Paul here comes Don, and he seems to be pointing at you."
Q: Then what happened?
A: I noticed that defendant Don was rushing toward the office, screaming at me and waving his arms.
[3] Q: O.K., what happened after he rushed toward you screaming and waiving a knife?
A: Well, I just turned and ran down the hall.
[4] Q: I see. So you didn't say anything to him and you didn't provoke him in any way?
A: Yes definitely. I didn't know what had gotten into him.
Q: Where were you interviewed by the police?
A: At the hospital.
Q: And did you tell them anything different from what you have told the jury today?
[5] A: No, I told the police exactly what I've said here. I have had a clear recollection of what happened ever since that day.
Q: How much were your medical expenses?
A: I don't remember specifically.
[6] Q: Would it refresh your recollection if I told you it was $27,520?
[7] A: No, but it's on the bill from the University Hospital.
[8] Q: You testified that you didn't know what had provoked Don, but the day before the incident you expelled six of his students for no reason, changed the lock on his office, and scraped the parking sticker off his car. Isn't that correct?
A: That's not right.
Q: You would agree that Don and you had your differences?
[9] A: No, we always got along well, and when he came after me that morning he had a lethal weapon.
At each of the nine indicated points, what objection or objections, if any, should have been made, and how should the court have ruled?
July 1992, Question 1 [Community Property]
Tony and Wanda were married in New York in 1959. They separate in 1963, and Wanda moved to California.
In 1964, Tony represented to Wanda that he had divorced her. Believing Tony, Wanda became engaged to Hap. Shortly before their duly licensed and witnessed 1965 marriage in California, Wanda and Hap orally agreed, among other things, that any insurance proceeds either might collect during their marriage would be their community property.
Six months after their marriage, Wanda received $100,000 as the beneficiary of her deceased father's life insurance policy. She deposited the $100,000 in a stock brokerage account titled in her name alone. The account was managed for her by a financial consultant, and now has a value of $300,000.
In 1980, Hap received a $200,000 inheritance from his mother, with which he purchased a restaurant. Hap has continuously managed the restaurant. It is highly rated for its food, decor, and service. Last month, Hap was offered $1,000,000 for the restaurant.
In 1988, Wanda's employer purchased for her and has continued to pay all premiums on a $500,000 life insurance policy. Wanda's insurance beneficiary designation is: "my surviving husband."
Last week Wanda died in a work-related accident. Wanda's will, duly executed in 1980, leaves all her community property to Hap, and all her separate property to her sister, Betty.
Tony has reappeared and can prove that despite his representation to Wanda, they were never divorced.
What are Hap's rights?
a. In the stock brokerage account? Discuss.
b. In the restaurant? Discuss.
c. In Wanda's life insurance proceeds? Discuss.
Answer according to California law.
July 1992 Question 3 [Evidence]
Dan is charged with the murder of Vickie, who was strangled with a red scarf and left in a garbage container. At the trial by jury, the following occurred:
1. Roomi, Vickie's roommate, testified for the prosecution that Vickie told her as Vickie was leaving their apartment on the night of her death, "Dan and I are going to see The Graduate at First Theater."
2. At the prosecutor's request, the court took judicial notice that on the night of Vickie's death, First Theater was showing The Graduate.
3. Sally, who had dated Dan about a year prior to Vickie's death, testified for the prosecution that when she rebuffed Dan's sexual advances he dragged her into an alley by some garbage containers, produced a red scarf, and attempted to strangle her.
4. The prosecution introduced into evidence Dan's constitutionally obtained written statement that on the night of Vickie's murder he had gone alone to Second Theatre to see "Cinderella." The prosecution then called Manny, the manager of Second Theater, who produced a photocopy of the Second Theater's computer printout that listed the movies shown during the two-week period around Vickie's death. It reveals that at no time during that period did Second Theater show Cinderella. The photocopy of the computer printout was received into evidence.
5. Pro, a member of the same country club to which Sally belongs, testified for the defense that Sally has a reputation at the Club for lying about her golf scores.
Assume that in each instance all appropriate objections were made.
Was each item of Evidence 1 through 5 properly admitted? Discuss.
July 1992 Question 4 [Wills] [Trusts]
Pop's wife died in 1980. In 1985, Pop properly executed a will which did not name a trustee, but provided that $100,000 was to be held in trust for ten years following Pop's death, with all income to be accumulated in the trust. At the end of the ten year period, all money in the trust was to be distributed in equal shares to persons who had both (1) been employed by Pop at the time of his death and (2) survived to the end of the ten-year period. All the rest of Pop's property, including his house, was to be distributed at the time of his death in equal shares to Pop's two children, Sam and Dona.
In 1988, Pop properly executed and delivered to Dona a deed giving his house to Dona.
In 1989, Sam fraudulently convinced Pop that Dona had died. Actually, Dona was still alive.
Because he believed that Dona was dead, Pop properly executed a new will in 1990, revoking the 1985 will, precisely repeating the trust provisions of the 1985 will, and providing that all Pop's other property, including the house, was to go to Sam.
Later in 1990 Sam died, leaving two surviving children, Gail and Greg.
Pop died in 1991, leaving as his only surviving relatives: his daughter, Dona; his grandchildren, Gail and Greg; and his aunt, Maude.
At his death in 1991, Pop's estate was sufficient to pay all valid bequests and devises.
A. Did Pop's 1990 will effectively revoke the 1985 will? Discuss.
B. After Pop's death, who owned the house? Discuss.
C. Was Pop's attempt to establish a trust for his employees effective and, if so, to whom are trust distributions to be made? Discuss.
D. Of the property which will be distributed to Pop's relatives, which relatives will get what fractions of the property? Discuss.
July 1992 Question 5 [Criminal Law]
Art and Bill were involved in the transportation and distribution of illegal drugs. Bill delivered the drugs to distribution points throughout the city. Art suspected, correctly, that Bill was being followed by undercover drug enforcement officer. Unbeknownst to Bill, Art hired Earl to be Bill’s bodyguard and told Carl that Bill needed protection from robbers because Bill delivered rare jewels. Carl’s assignment was to follow Bill at a distance and protect him from assault.
On his third day of work as a bodyguard, Carl saw a man confront Bill, hold him, and begin to search him. Bill resisted vigorously. Carl ran up and beat the man severely about the head,killing him. A police officer arrived and arrested Bill and Earl. Art was arrested soon after this when Carl told police that Part had hired him to act as a bodyguard.
The dead man was Vic, an undercover drug enforcement officer who had a valid warrant for the arrest of Hill. A briefcase Bill had been carrying contained a large amount of cocaine.
1. On what theory or theories might Art be prosecuted for the murder of Vic? Discuss.
2. If Carl is charged with the murder of Vic, what defenses should he offer and of what degree of murder or lesser included offense, if any, should he be convicted if those defenses are accepted by the trier of fact? Discuss.
[Remedies]
J6. Peter owned a sporting goods store. He learned that American Building Company (ABC) was about to construct a shopping mall in his city. Desirous of expanding his business, he approached ABC to arrange to rent a small space in the proposed mall. A lease agreement for a small store to be located in the East Wing of the mall was signed by Peter and ABC on July 1, 1991.
Although the dimensions of the space and its proposed rent are recited in the agreement no provision is made for an exact date when the space would be completed and ready for occupancy. The agreement explicitly leaves the determination of when the East Wing of the mall will be built to the judgment of ABC.
On August 1, 1991, Peter learned through a newspaper column that ABC had agreed with a toy company to lease to it the entire East Wing of the mall, including the area where Peter's store would have been located. Feeling that he had a valid contract, Peter took no immediate action; he thought that ABC would eventually accommodate him either by extending existing plans for that part of the mall or by offering him alternative space elsewhere in the mall.
In March 1992, Peter inquired of ABC when he might expect his space to be ready for occupancy. He was informed that ABC had changed its plans and was in the process of building a structure in which it would rent space in the East Wing
to four or five major lessees, not including Peter, and that there would be no space elsewhere in the mall for Peter.
In an action by Peter against ABC in state court in State X, Peter has obtained an ex parte temporary restraining order halting construction.
1. Is Peter entitled to a preliminary injunction against ABC restraining it from proceeding with construction based on the changed building plans? Discuss.
2. Can Peter eventually force ABC to build and lease to him a space as described in the lease agreement of July 1, 1991? Discuss.