[Contracts] [Torts]
In February 1997, Carrier, a trucking company, and Maker, a manufacturer, negotiated an agreement under which Carrier promised to provide for two years all the transportation services required by Maker in exchange for monthly payments based on the number of packages transported. In response to Carrier's concerns over proposed legislation that would restrict its ability to use more efficient "triple-trailer" trucks, the parties agreed that Carrier could terminate the contract if such legislation were enacted. No such law was ever passed.
Carrier drafted a document embodying the agreed terms and, on March 1, 1997, sent two signed copies to Maker with a request that Maker sign and return one copy. Although Maker did not sign the document, the parties immediately began doing business according to its terms. During the next six months, Maker paid all of Carrier's monthly invoices on time. During the same period, Carrier declined two potentially lucrative offers from other manufacturers because performance of the agreement with Maker required most of Carrier's capacity.
In September 1997, Maker began to have concerns about the cost of Carrier's service. Maker sent a letter to Transport, one of Carrier's competitors, describing Maker's needs, Maker's agreement with Carrier, and the amount charged by Carrier.
Transport offered to provide comparable transportation services at a lower cost. On September 20, Maker sent a fax to Carrier stating that Maker would no longer use Carrier's services as of November 1. Carrier responded with a fax to Maker which stated that Maker had no right to terminate the contract. On September 21, Maker suspended all business with Carrier and began doing business with Transport.
Maker also refused to pay an invoice submitted by Carrier for transportation services rendered in September.
What, if any, rights and remedies does Carrier have against:
1. Maker? Discuss.
2. Transport? Discuss.
[Constitutional law]
Hyde, an escapee from a mental hospital for the criminally insane, kidnaped Vic, a prominent citizen of Gotham. In a message to the Gotham police, Hyde warned that he would kill Vic if (a) Hyde's identity as the kidnapped was divulged to the public or (b) The Press, Gotham's leading local newspaper, failed to publish prominently and in its entirety Hyde's political Manifesto," an incoherent essay of over 20,000 words, within 48 hours. Hyde's message was somehow leaked to a reporter of the Press at police headquarters. Asserting that journalistic integrity was at stake and that the cost would be exorbitant, The Press rejected an urgent request from the Gotham police chief for compliance with Hyde's demands. Vic's family immediately filed an injunctive action in state court against The Press, obtaining an ex part temporary injunction prohibiting The press from publishing Hyde's identity as the kidnapper and mandating it to publish Hyde's full "Manifesto" in a main edition of The Press within 48 hours. Publishing the "Manifesto" in accordance with the temporary injunction will cost The Press over $175,000 in lost advertising revenue and overtime wages. The Presses timely moved to dissolve the temporary injunction on the grounds that it violates rights guaranteed by the First Amendment and by the "Takings Clause" of the Fifth Amendment to the U.S. Constitution. 1 . What arguments can The Press reasonably make in support of the motion to dissolve the injunction, and how should the court rule? Discuss. 2 . May The Press ignore the temporary injunction without incurring liability for contempt? Discuss.
[Evidence]
Don is being prosecuted criminally for committing an armed assault against Victor. The evidentiary issues presented in his jury trial are based upon the following chronology of events:
1. June 5, 1985: Don was convicted of bribery and received a three-year sentence which he served in full without parole;
2. June 1, 1997: Victor was assaulted, allegedly by Dan;
3. June 4, 1997: Victor identified Don from a lineup as the person who assaulted him (Victor);
4. June 6, 1997: Don was arrested and charged with the assault of Victor;
5. August 1, 1997: Don confessed privately to his long-time fiancee, Bernice, that he (Don) is the one who assaulted Victor;
6. August 15, 1997: Detective Phillips, who had been present at the June 4 lineup, testified at a prelimninary hearing that Victor identified Don at the June 4 lineup, and Phillips was cross-examined by Don's attorney;
7. September 1, 1997: Don and Bernice were married;
8. September 15, 1997: Detective Phillips was shot and killed in a hunting accident;
9. October 1, 1997: Don, again privately, confessed to Bernice that he (Don) is the one who assaulted Victor;
10. November 1, 1997: Don and Bernice were divorced;
11. December 1, 1997: The case against Don comes to trial;
12. December 1, 1997: Victor testifies at trial, remembers making a lineup identification, but cannot make an in-court identification;
13. December 3, 1997: The prosecution seeks to introduce a certified transcript of the preliminary hearing testimony of Detective Phillips;
14. December 4, 1997: The prosecution calls Bernice, seeking to have her testify to the August 1 and October 1 confessions of Don, and both Bernice and Don raise marital privilege objections;
15. December 8, 1997: The prosecution calls a witness, seeking testimony as to Victor's reputation for peacefulness in his community;
16. December 9, 1997: The prosecution rests; and
17. December 10, 199 7: Don testifies in his own defense, and on cross examination the prosecution seeks to impeach Don with his 1985 bribery conviction.
Assuming that all appropriate objections were made, should the court admit the evidence offered by the prosecution in numbers 13, 14, 15, and 17, as specified above? Discuss.
[Real Property] [Professional Responsibility]
In 1975, Donna asked her neighbor, Stan, to give her a roadway easement across his property so Donna could have better access to her own property. Stan agreed and asked Len, his lawyer, to prepare a deed granting an “easement for a road 30 feet wide” along a designated path. Len prepared the deed, which Stan signed and instructed Len to give to Donna. Unbeknownst to Stan, Len was also Donna’s attorney and had advised her to obtain an easement from Stan.
Stan died that night. Although he was aware of Stan’s death, Len gave the deed to donna the next day. Donna never recorded the deed.
In 1976, Donna constructed a gravel road 15 feet wide along the designated path. Donna continued to farm her land and use the road. She has repaired the road, but not improved it. Stan’s son Paul inherited Stan’s farm and has never objected to Donna’s activities.
In 1997, Donna announced plans to convert her farm to a commercial complex. She now intends to use the road as the complex’s main entrance, widening it to 30 feet, paving it, and putting utilities under the pavement.
Paul objects to Donna’s plans for the road. A paved road will interfere with his farming. The area is changing and some farms have converted to commercial use, but Paul wants to continue farming.
1. What rights and interests do Donna and Paul each have in the road? Discuss.
2. May Donna, over Paul’s objection, carry out her plans for the road? Discuss.
3. Has Len violated any rules of professional conduct? Discuss.
[Remedies]
Halfway, Inc. is a nonprofit organization, licensed by the state, to assist with the rehabilitation of former convicts. It owns a five-bedroom house in a residential neighborhood of well-maintained single-family homes. The house purchased by Halfway is on a parcel zoned for multiple family use, as is a small apartment building across the street. The remaining parcels are zoned for single family use only.
For the past three months, Halfway has been using the building as a halfway house for parolees from state prison. At any given time, six to eight parolees live in the house while they look for employment and adjust to life in society. Most of the parolees are former sex and drug offenders. Such offenders have high recidivism rates. There is strict supervision by at least one resident director on the premises at all times. Halfway has successfully operated halfway houses in three other residential neighborhood locations in the state, attributing its success to the behavioral influences inherent in established residential environments.
Residents and property owners in the neighborhood have formed NASS, a neighborhood association that wants to prevent the halfway house from continuing to operate. NASS members are concerned about their safety, the safety of their children and their property values. While the halfway house was being renovated in preparation for the parolee program, one of Halfway’s employees , not a parolee, assaulted a woman who lives in the neighborhood and is a NASS member.
NASS recently discovered that 20 years ago an injunction had issued and been recorded in the chain of title of Halfway’s parcel forbidding the use of the property as a residence by unmarried persons living together. The injunction had issued because a group of college students, while living in the house, caused disturbances with late-night parties and loud rock music.
NASS, on behalf of its members, has sued Halfway. In its complaint, NASS prays for: (1) an injunction against operation of a halfway house on the parcel Halfway has purchased on the grounds that the halfway house constitutes both a public and a private nuisance and (2) a declaratory judgment that the 20-year-old injunction is an in rem injunction that prevents Halfway from operating a halfway house.
What evidence must NASS produce to make a prima facie showing on each of its claims, what defenses might Halfway reasonably assert, and how should this court rule on each of NASS’s claims? Discuss.
[Wills]
In 1994, Testator (T), a widow with two adult children, executed a typewritten will providing:
1. $100,000 to Son (S).
2. My farm to Friend One (F1) and Friend Two (F2), share and share alike.
3. The residue of my estate to Daughter (D).
T signed the will in the presence of S and Witness (W), each of whom, being present at the same time, witnessed the signing, understood the document was T’s will, and signed as a witness. T had testamentary capacity and was not subject to duress, menace, fraud, undue influence, coercion, mistake or other pernicious influence.
In 1997, T and D were killed instantly in an automobile collision. T’s will was found in her safe deposit box with a line drawn through part of paragraph 2, as follows:
2. My farm to Friend One (F1) and Friend Two (F2) share and share alike.
D was survived by Husband (H) but no issue. She did not have a will. T’s estate consisted of $100,000 cash, her farm (worth $50,000), and other property worth $100,000.
1. Was T’s will validly executed? Discuss.
2. Assume T’s will was validly executed. How should T’s estate be distributed? Discuss.
Assume the applicable statutory law is that of California.
[Community Property]
Winnie and Herb married in State X in 1990. Prior to their marriage, Winnie had been a lifelong resident of State X ... Winnie and Herb moved to California in 1993. Winnie continued to be active in managing her own substantial brokerage account which she had acquired with her savings prior to her marriage. Winnie did not move the account from State X after moving to California with Herb. On most business days, she directs her stock broker in State X to buy and sell particular stocks. Winnie has been very successful as an investor. At her direction
[Civil Procedure]
Pat was living in State X when he was arrested and charged with violating a State X criminal statute. Because of overcrowding in State X Penitentiary, however, Pat was forced to await trial while incarcerated in the security wing of Delta Hospital (D), a private hospital for persons with psychiatric disorders, located and incorporated in the neighboring state of Y.
Pat filed a class action complaint against D in a federal court in State X on behalf of himself, on behalf of 25 similarly situated inmates who were incarcerated at D awaiting trial in State and on behalf of all such future inmates. The complaint alleged violations of the State Y Prisoners’ Rights Act, which guarantees prisoners, inter alia, the right to safe food. The complaint alleged that the food served at D was often spoiled and contaminated with vermin droppings and that, as a result, he suffered continual gastrointestinal disorders. Pat requested $70,000 in damages and an injunction prohibiting D from serving tainted food. D was properly served with a copy of the complaint. Before D responded to the civil complaint, Pat's brother paid Pat's bail. As a result, Pat is no longer detained at D and has returned to State X. The federal district court:
1 . Denied a motion by D to dismiss for lack of jurisdiction;
2. Declined to certify the class on the ground that the class was not large enough;
3. Denied a motion by D to change venue to a federal district court in State Y; and
4. Granted a motion by D to dismiss the action as moot. Was each of the rulings correct? Discuss.
[Professional Responsibility] [Business Associations]
Attorney Ann is a member of the Board of Directors of Californians Against Poverty (CAP), a non-profit corporation. Two years ago, CAP received a grant from the Department of Labor to provide computer training to unemployed individuals. The Department of Labor now wants to audit CAP’s books to verify the grant expenditures. CAP’s executive director, Dave, has taken the position that CAP’s books are confidential and has refused to allow the audit.
Since Ann is the only attorney on the Board of Directors, Dave asked her to assist him in presenting the issue to the CAP Board of Directors. Ann concluded that an argument could be made that the audit request is too broad and is not specifically authorized by the grant documents. However, in the course of discussing the proposed audit, Dave informed Ann that the real reason he opposed the audit was that he used grant funds to purchase two personal computers for his children to use at home. This is a violation of the terms of the federal grant and, arguably, a violation of federal criminal statutes.
At the next meeting of the CAP Board of Directors, Dave presented the matter without making any mention of any misuse of funds. Ann said nothing, and the Board adopted a resolution opposing the audit. Dave then asked Ann to represent CAP on a pro bono basis to file an action against the Department of Labor to enjoin the audit.
1. What, if any, ethical issues are raised by Ann's role both as an attorney and a member of CAP's Board? Discuss.
2. Is Ann ethically required to disclose to the Board Dave's misuse of funds? Discuss.
3. Can Ann ethically represent CAP on a pro bono basis in a suit to enjoin the audit? Discuss.
[Torts]
Transco, a common carrier, hauls toxic chemicals by train through an area where Paul operates a commercial greenhouse. Concerned about the risks if there were spillage from one of the box cars containing the chemicals, Transco hired Diana, a consultant, to assess that risk. Diana concluded there was little or no risk to nearby property owners if any such spillage occurred, and she so advised Transco.
Thereafter, one of Transco’s trains containing a known toxic chemical derailed because the train engineer suffered a heart attack while operating the engine. The engineer was obese and, five years earlier, had taken a leave of absence because of a mild heart attack he had suffered. The derailment caused chemical spillage near Paul’s property, and Paul closed his greenhouse business out of fear that this spillage would damage his greenhouse plants and cause him to get cancer. In fact, no lasting damage resulted from the spill.
Six months after the accident, Paul moved back into his previously vacated premises and began operating the greenhouse again. Paul’s fear for his health from possible exposure to the chemical continued, however, and subsequently he suffered severe anxiety and depression because of this fear.
On what theory or theories, if any, can Paul recover damages from, and what defenses may reasonably be raised by:
a. Transco? Discuss.
b. Diana? Discuss.
Carl owned 30% of the common stock of Motco, a corporation engaged in manufacturing high priced motorcycles. Motco has 200 shareholders. No shareholder other than Carl owned more than 2% of Motco's stock. Motco's most valuable asset has been a large plant where its internationally famous motorcycles are made.
Bigco is a corporation, all of the stock of which is owned by Albert Rich ("Rich"). Three other corporations that were recently acquired by Bigco have since become insolvent and failed. Bigco made an offer to Carl to buy all of Carl's Motco stock for $25 per share.
Before he accepted the offer, Carl received a letter from the former president of one of the three failed companies asserting that the failure had been caused by Rich "looting" the company after Bigco acquired it. The letter also stated that Bigco and Rich had been sued in an action in which it was alleged that they had dissipated the assets of all three failed companies after Bigco acquired control to raise funds for other business acquisitions. When Carl questioned Rich about this letter, he was told that the letter writer was a disgruntled former employee who had been fired for incompetence. Based on that response, Carl conducted no further inquires. If he had, he would have found that final judgments had been entered in litigation concerning Bigco's control of the three failed companies, holding Bigco and Rich liable for wrongful diversion of assets.
Carl accepted Bigco's offer. At the time of purchase, Motco's common stock was selling for $11 per share. As part of the stock sale agreement with Bigco, Carl undertook to ensure that all nine members of Motco's board of directors would resign and that Bigco's nine nominees would be elected as the replacement Motco directors, before ownership of Carl's 30% block of Motco stock passed to Bigco. The replacement of the Motco directors took place as planned.
Thereafter, Motco's new board of directors voted unanimously to convert the Motco motorcycle plant exclusively to the manufacture of motor-driven bicycles (mopeds), despite recent adverse publicity over an increasing number of moped accidents. This decision was motivated by a desire to provide an outlet for moped parts manufactured by another corporation controlled by Rich. At present, Motco's earnings from the sale of mopeds are substantially less than its former earnings from the sale of motorcycles.
Pat is a 1% shareholder of Motco. By proper procedures, she has instituted a shareholders' derivative action against Carl, Motco's new directors, and Bigco based on the events described above.
To what relief is Pat entitled in the derivative action, and on what bases and against which defendants? Discuss.
Do not discuss federal or state securities law issues.
[Evidence]
A car driven by Dunn collided with Empire Trucking Co.’s truck driven by Kemper. Kemper died at the scene. Dunn and Dunn’s passenger, Paul, were seriously injured. Paul sued Empire for personal injuries. Paul attempted to serve Sigel, an Empire mechanic who was on duty the day of the collision, with a subpoena to appear at the trial, but the process server could not locate Sigel. The following occurred at the jury trial.
1. Paul called the investigating police officer, Oliver, who testified that he talked to Wit at the scene a half hour after the collision. Oliver wrote down Wit’s statement and attached it to his report. Oliver testified that Wit told him that he ran over to the scene from the curb and spoke to the driver of the car, Dunn, who told Wit: “I’m not going to make it and I want you to know the truth - the truck ran a red light.”
2. Paul called a court reporter who properly authenticated the trial transcript of Sigel’s testimony in People v. Dunn, a reckless homicide case relating to the same incident, in which Sigel testified that on the morning of the incident he warned Kemper that the brakes on the truck were defective, but Kemper drove the truck anyway. The transcript was admitted into evidence.
3. Paul called Dunn who testified that she had a green light and was driving below the speed limit when defendant’s truck struck her car.
4. Empire offered into evidence a properly authenticated copy of the conviction of Dunn for reckless homicide based on this incident. Paul’s objections to this offer were sustained.
5. Empire asked Dunn on cross examination: “Q. Isn’t it true your insurance carrier reached a settlement with Paul and as part of that written agreement, you agreed to testify on Paul’s behalf today?” Paul’s objections to this question were sustained.
Assume that all appropriate objections were made. Was the evidence in items (1), (2), and (3) properly admitted, and were the objections in (4) and (5) properly sustained? Discuss.