Business law case scenarios

6–4. Intentional Infliction of Emotional Distress. While living in her home country of Tanzania, Sophia Kiwa nuka signed an employment contract with Anne Margareth Bakilana, a Tanzanian living in Washington, D.C. Kiwanuka traveled to the United States to work as a babysitter and maid in Bakilana’s house. When Kiwanuka arrived, Bakilana con fiscated her passport, held her in isolation, and forced her to work long hours under threat of having her deported. Kiwa nuka worked seven days a week without breaks and was sub jected to regular verbal and psychological abuse by Bakilana. Kiwanuka filed a complaint against Bakilana for intentional infliction of emotional distress, among other claims. Bakilana argued that Kiwanuka’s complaint should be dismissed because the allegations were insufficient to show outrageous intentional conduct that resulted in severe emotional distress. If you were the judge, in whose favor would you rule? Why? [Kiwanuka v. Bakilana, 844 F.Supp.2d 107 (D.D.C. 2012)] (See Intentional Torts against Persons.)6–6. Negligence. Ronald Rawls and Zabian Bailey were in an auto accident in Bridgeport, Connecticut. Bailey rear-ended Rawls at a stoplight. Evidence showed it was more likely than not that Bailey failed to apply his brakes in time to avoid the collision, failed to turn his vehicle to avoid the collision, failed to keep his vehicle under control, and was inattentive to his surroundings. Rawls filed a suit in a Connecticut state court against his insurance company, Progressive Northern Insur ance Co., to obtain benefits under an underinsured motorist clause, alleging that Bailey had been negligent. Could Rawls collect? Discuss. [Rawls v. Progressive Northern Insurance Co., 310 Conn. 768, 83 A.3d 576 (2014)] (See Unintentional Torts—Negligence.)7–3. Design Defects. Yun Tung Chow tried to unclog a floor drain in the kitchen of the restaurant where he worked. He used a drain cleaner called Lewis Red Devil Lye that con tained crystalline sodium hydroxide. The product label said to wear eye protection, to put one tablespoon of lye directly into the drain, and to keep one’s face away from the drain because there could be dangerous backsplash. Without eye protection, Chow mixed three tablespoons of lye in a can and poured that mixture down the drain while bending over it. Liquid splashed back into his face, causing injury. He brought a product liability suit based on inadequate warnings and design defect. The trial court granted summary judgment to the manufacturer, and Chow appealed. An expert for Chow stated that the product was defective because it had a tendency to backsplash. Is that a convincing argument? Why or why not? [Yun Tung Chow v. Reckitt & Coleman, Inc., 69 A.D.3d 413, 891 N.Y.S.2d 402 (N.Y.A.D. 1 Dept. 2010)] (See Strict Product Liability.) 7–4. Strict Product Liability. David Dobrovolny bought a new Ford F-350 pickup truck. A year later, the truck spon taneously caught fire in Dobrovolny’s driveway. The truck was destroyed, but no other property was damaged, and no one was injured. Dobrovolny filed a suit in a Nebraska state court against Ford Motor Co. on a theory of strict product liability to recover the cost of the truck. Nebraska limits the applica tion of strict product liability to situations involving personal injuries. Is Dobrovolny’s claim likely to succeed? Why or why not? Is there another basis for liability on which he might recover? Explain. [Dobrovolny v. Ford Motor Co., 281 Neb. 86, 793 N.W.2d 445 (2011)] (See Strict Product Liability.) 7–5. Product Misuse. Five-year-old Cheyenne Stark was riding in the backseat of her parents’ Ford Taurus. Chey enne was not sitting in a booster seat. Instead, she was using a seatbelt designed by Ford, but was wearing the shoulder belt behind her back. The car was involved in a collision. As 468, 723 S.E.2d 753 (2012)] (See Defenses to Product Liability.) 7–7. Strict Product Liability. Medicis Pharmaceutical Corp. makes Solodyn, a prescription oral antibiotic. Medi cis warns physicians that “autoimmune syndromes, includ ing drug-induced lupus-like syndrome,” may be associated with use of the drug. Amanda Watts had chronic acne. Her physician prescribed Solodyn. Information included with the drug did not mention the risk of autoimmune disorders, and Watts was not otherwise advised of it. She was prescribed the drug twice, each time for twenty weeks. Later, she experienced debilitating joint pain and, after being hospitalized, was diag nosed with lupus. On what basis could Watts recover from Medicis in an action grounded in product liability? Explain. [Watts v. Medicis Pharmaceutical Corp., 236 Ariz. 511, 342 P.3d 847 (2015)] (See Strict Product Liability.)8–1. Fair Use. Professor Wise is teaching a summer semi nar in business torts at State University. Several times during the course, he makes copies of relevant sections from business law texts and distributes them to his students. Wise does not realize that the daughter of one of the textbook authors is a member of his seminar. She tells her father about Wise’s copy ing activities, which have taken place without her father’s or his publisher’s permission. Her father sues Wise for copyright infringement. Wise claims protection under the fair use doc trine. Who will prevail? Explain. (See Copyrights.) 8–3. Spotlight on Macy’s—Copyright Infringement. United Fabrics International, Inc., bought a fabric design from an Italian designer and registered a copyright to it with the U.S. Copyright Office. When Macy’s, Inc., began selling garments with a similar design, United filed a copyright infringement suit against Macy’s. Macy’s argued that United did not own a valid copyright to the design and so could not claim infringement. Does United have to prove that the copyright is valid to estab lish infringement? Explain. [United Fabrics International, Inc. v. C&J Wear, Inc., 630 F.3d 1255 (9th Cir. 2011)] (See Copyrights.) 8–4. Theft of Trade Secrets. Hanjuan Jin, a citizen of China, worked as a software engineer for Motorola for many years in a division that created proprietary standards for cellu lar communications. Contrary to Motorola’s policies, Jin also secretly began working as a consultant for Lemko Corp., as well as with Sun Kaisens, a Chinese software company, and with the Chinese military. She started corresponding with Sun Kaisens’s management about a possible full-time job in China. Jin took several medical leaves of absence from Motorola to return to Beijing and work with Sun Kaisens and the military. After one of these medical leaves, Jin returned to Motorola. Over a period of several days, Jin accessed and downloaded thousands of documents on her personal laptop and on pen drives. When, later, she attempted to board a flight to China from Chicago, she was randomly searched by U.S. Customs and Border Protection officials at the airport. U.S. officials dis covered the downloaded Motorola documents. Are there any circumstances under which Jin could avoid being prosecuted for theft of trade secrets? If so, what are these circumstances? Discuss fully. [United States v. Hanjuan Jin, 833 F.Supp.2d 977 (N.D.Ill. 2012)] (See Trade Secrets.) 8–5. Copyright Infringement. SilverEdge Systems Soft ware hired Catherine Conrad to perform a singing telegram. SilverEdge arranged for James Bendewald to record Conrad’s performance of her copyrighted song to post on its Web site. Conrad agreed to wear a microphone to assist in the record ing, told Bendewald what to film, and asked for an additional fee only if SilverEdge used the video for a commercial pur pose. Later, the company chose to post a video of a different performer’s singing telegram instead. Conrad filed a suit in a federal district court against SilverEdge and Bendewald for copyright infringement. Are the defendants liable? Explain. [Conrad v. Bendewald, 500 Fed.Appx. 526 (7th Cir. 2013)] (See Copyrights.)9–1. Internet Service Providers. CyberConnect, Inc., is an Internet service provider (ISP). Pepper is a CyberCon nect subscriber. Market Reach, Inc., is an online advertis ing company. Using sophisticated software, Market Reach directs its ads to those users most likely to be interested in a particular product. When Pepper receives one of the ads, she objects to the content. Further, she claims that CyberConnect should pay damages for “publishing” the ad. Is the ISP regarded as a publisher and therefore liable for the content of Market Reach’s ad? Why or why not? (See Online Defamation.)9–4. File-Sharing. Dartmouth College professor M. Eric Johnson, in collaboration with Tiversa, Inc., a company that monitors peer-to-peer networks to provide security services, wrote an article titled “Data Hemorrhages in the Health-Care Sector.” In preparing the article, Johnson and Tiversa searched the networks for data that could be used to commit medical or financial identity theft. They found a document that con tained the Social Security numbers, insurance information, and treatment codes for patients of LabMD, Inc. Tiversa noti fied LabMD of the find in order to solicit its business. Instead of hiring Tiversa, however, LabMD filed a suit in a federal district court against the company, alleging trespass, conver sion, and violations of federal statutes. What do these facts indicate about the security of private information? Explain. How should the court rule? [LabMD, Inc. v. Tiversa, Inc., 2013 WL425983 (11th Cir. 2013)] (See Copyrights in Digital Information.) 9–5. Social Media. Mohammad Omar Aly Hassan and nine others were indicted in a federal district court on charges of conspiring to advance violent jihad (holy war against ene mies of Islam) and other offenses related to terrorism. The evi dence at Hassan’s trial included postings he made on Facebook concerning his adherence to violent jihadist ideology. Con victed, Hassan appealed, contending that the Facebook items had not been properly authenticated (established as his own comments). How might the government show the connection between postings on Facebook and those who post them? Dis cuss. [United States v. Hassan, 742 F.3d 104 (4th Cir. 2014)] (See Social Media.) 9–6. Social Media. Kenneth Wheeler was angry at cer tain police officers in Grand Junction, Colorado, because of a driving-under-the-influence arrest that he viewed as unjust. While in Italy, Wheeler posted a statement to his Facebook page urging his “religious followers” to “kill cops, drown them in the blood of their children, hunt them down and kill their entire bloodlines” and provided names. Later, Wheeler added a post to “commit a massacre in the Stepping Stones preschool and day care, just walk in and kill everybody.” Could a reasonable person conclude that Wheeler’s posts were true threats? How might law enforce ment officers use Wheeler’s posts? Explain. [United States v. Wheeler, 776 F.3d 736 (10th Cir. 2015)] (See Social Media.)10–1. Types of Cyber Crimes. The following situations are similar, but each represents a variation of a particular crime. Identify the crime and point out the differences in the variations. (See Cyber Crime.) (a) Chen, posing fraudulently as Diamond Credit Card Co., sends an e-mail to Emily, stating that the company has observed suspicious activity in her account and has frozen the account. The e-mail asks her to reregister her credit card number and password to reopen the account. (b) Claiming falsely to be Big Buy Retail Finance Co., Con ner sends an e-mail to Dino, asking him to confirm or update his personal security information to prevent his Big Buy account from being discontinued. (c) Felicia posts her résumé on GotWork.com, an online job posting site, seeking a position in business and manage rial finance and accounting. Hayden, who misrepresents himself as an employment officer with International Bank & Commerce Corp., sends her an e-mail asking for more personal information. 10–2. Cyber Scam. Kayla, a student at Learnwell Univer sity, owes $20,000 in unpaid tuition. If Kayla does not pay the tuition, Learnwell will not allow her to graduate. To obtain the funds to pay the debt, she sends e-mails to people that she does not personally know asking for financial help to send Milo, her disabled child, to a special school. In reality, Kayla has no children. Is this a crime? If so, which one? (See Cyber Crime.) 10–3. Credit-Card Theft. Jacqueline Barden was shop ping for school clothes with her children when her purse and automobile were taken. In Barden’s purse were her car keys, credit and debit cards, and the children’s Social Security cards and birth certificates, which were needed for enrollment at school. Immediately after the purse and car were stolen, Rebecca Mary Turner attempted to use Barden’s credit card at a local Exxon gas station, but the card was declined. The gas station attendant recognized Turner because she had previ ously written bad checks and used credit cards that did not belong to her. Turner was later arrested while attempting to use one of Barden’s checks to pay for merchandise at a Wal-Mart—where the clerk also recognized Turner from prior criminal activity. Turner claimed that she had not stolen Barden’s purse or car. Instead, she said that a friend had told her he had some checks and credit cards and asked her to try using them at Wal-Mart. Turner was convicted at trial. She appealed, claiming that there was insufficient evidence that she committed credit and debit-card theft. Was the evidence sufficient to uphold her conviction? Why or why not? [Turner v. State of Arkansas, 2012 Ark.App. 150 (2012)] (See Types of Crimes.)10–7. Criminal Procedures. Federal officers obtained a warrant to arrest Kateena Norman on charges of credit-card fraud and identity theft. Evidence of the crime included vid eos, photos, and a fingerprint on a fraudulent check. A previ ous search of Norman’s house had uncovered credit cards, new merchandise, and identifying information for other persons. An Internet account registered to the address had been used to apply for fraudulent credit cards, and a fraudulently obtained rental car was parked on the property. As the officers arrested Norman outside her house, they saw another woman and a caged pit bull inside. They further believed that Norman’s boy friend, who had a criminal record and was also suspected of identify theft, could be there. In less than a minute, the officers searched only those areas within the house in which a person could hide. Would it be reasonable to admit evidence revealed in this “protective sweep” during Norman’s trial on the arrest charges? Discuss. [United States v. Norman, __ F.3d __, 2016 WL 324949 (11th Cir. 2016)] (See Criminal Procedures.)11–1. Unilateral Contract. Rocky Mountain Races, Inc., sponsors the “Pioneer Trail Ultramarathon,” with an adver tised first prize of $10,000. The rules require the competitors to run 100 miles from the floor of Blackwater Canyon to the top of Pinnacle Mountain. The rules also provide that Rocky reserves the right to change the terms of the race at any time. Monica enters the race and is declared the winner. Rocky offers her a prize of $1,000 instead of $10,000. Did Rocky and Monica have a contract? Explain. (See Types of Contracts.) 11–2. Implied Contract. Janine was hospitalized with severe abdominal pain and placed in an intensive care unit. Her doctor told the hospital personnel to order around-the-clock nursing care for Janine. At the hospital’s request, a nursing ser vices firm, Nursing Services Unlimited, provided two weeks of in-hospital care and, after Janine was sent home, an additional two weeks of at-home care. During the at-home period of care, Janine was fully aware that she was receiving the benefit of the nursing services. Nursing Services later billed Janine $4,000 for the nursing care, but Janine refused to pay on the ground that she had never contracted for the services, either orally or in writing. In view of the fact that no express contract was ever formed, can Nursing Services recover the $4,000 from Janine? If so, under what legal theory? Discuss. (See Types of Contracts.)12–1. Agreement. Ball e-mails Sullivan and inquires how much Sullivan is asking for a specific forty-acre tract of land Sullivan owns. Sullivan responds, “I will not take less than $60,000 for the forty-acre tract as specified.” Ball immediately sends Sullivan a fax stating, “I accept your offer for $60,000 for the forty-acre tract as specified.” Discuss whether Ball can hold Sullivan to a contract for the sale of the land. (See Agreement.)12–5. Acceptance. Judy Olsen, Kristy Johnston, and their mother, Joyce Johnston, owned seventy-eight acres of real property on Eagle Creek in Meagher County, Montana. When Joyce died, she left her interest in the property to Kristy. Kristy wrote to Judy, offering to buy Judy’s interest or to sell her own interest to Judy. The letter said to “please respond to Bruce Townsend.” In a letter to Kristy—not to Bruce—Judy accepted Kristy’s offer to sell her interest. By that time, how ever, Kristy had made the same offer to sell her interest to their brother, Dave, and he had accepted. Did Judy and Kristy have an enforceable, binding contract? Or did Kristy’s offer specify ing one exclusive mode of acceptance mean that Judy’s reply was not effective? Discuss. [Olsen v. Johnston, 368 Mont. 347, 301 P.3d 791 (2013)] (See Agreement.)13–1. Preexisting Duty. Tabor is a buyer of file cabinets manufactured by Martin. Martin’s contract with Tabor calls for delivery of fifty file cabinets at $40 per cabinet in five equal installments. After delivery of two installments (twenty cabi nets), Martin informs Tabor that because of inflation, Martin is losing money. Martin will promise to deliver the remain ing thirty cabinets only if Tabor will pay $50 per cabinet. Tabor agrees in writing to do so. Discuss whether Martin can legally collect the additional $100 on delivery to Tabor of the next installment of ten cabinets. (See Agreements That Lack Consideration.) 13–2. Consideration. Daniel, a recent college graduate, is on his way home for the Christmas holidays from his new job. He is caught in a snowstorm and is taken in by an elderly cou ple, who provide him with food and shelter. After the snow plows have cleared the road, Daniel proceeds home. Daniel’s father, Fred, is most appreciative of the elderly couple’s action and promises to pay them $500. The elderly couple, in need of funds, accept Fred’s offer. Then, because of a dispute between Daniel and Fred, Fred refuses to pay the elderly couple the $500. Discuss whether the couple can hold Fred liable in con tract for the services rendered to Daniel. (See Agreements That Lack Consideration.) 13–3. Accord and Satisfaction. Merrick grows and sells blueberries. Maine Wild Blueberry Co. agreed to buy all of Merrick’s crop under a contract that left the price unliqui dated. Merrick delivered the berries, but a dispute arose over the price. Maine Wild sent Merrick a check with a letter stat ing that the check was the “final settlement.” Merrick cashed the check but filed a suit for breach of contract, claiming that he was owed more. What will the court likely decide in this case? Why? (See Settlement of Claims.)13–8. Agreements That Lack Consideration. Arkansas Missouri Forest Products, LLC (Ark-Mo), sells supplies to make wood pallets. Blue Chip Manufacturing (BCM) makes pallets. Mark Garnett, an owner of Ark-Mo, and Stuart Lerner, an owner of BCM, went into business together. Garnett and Lerner agreed that Ark-Mo would have a 30-percent owner ship interest in their future projects. When Lerner formed Blue Chip Recycling, LLC (BCR), to manage a pallet repair facility in California, however, he allocated only a 5-percent interest to Ark-Mo. Garnett objected. In a “Telephone Deal,” Lerner then promised Garnett that Ark-Mo would receive a 30-percent interest in their future projects in the Midwest, and Garnett agreed to forgo an ownership interest in BCR. But when Blue Chip III, LLC (BCIII), was formed to operate a repair facility in the Midwest, Lerner told Garnett that he “was not getting anything.” Ark-Mo filed a suit in a Missouri state court against Lerner, alleging breach of contract. Was there consideration to support the Telephone Deal? Explain. [Arkansas-Missouri Forest Products, LLC v. Lerner, __ S.W.3d __, 2016 WL 234889 (Mo.App. E.D. 2016)] (See Agreements That Lack Consideration.)13–8. Agreements That Lack Consideration. Arkansas Missouri Forest Products, LLC (Ark-Mo), sells supplies to make wood pallets. Blue Chip Manufacturing (BCM) makes pallets. Mark Garnett, an owner of Ark-Mo, and Stuart Lerner, an owner of BCM, went into business together. Garnett and Lerner agreed that Ark-Mo would have a 30-percent owner ship interest in their future projects. When Lerner formedBlue Chip Recycling, LLC (BCR), to manage a pallet repair facility in California, however, he allocated only a 5-percent interest to Ark-Mo. Garnett objected. In a “Telephone Deal,” Lerner then promised Garnett that Ark-Mo would receive a 30-percent interest in their future projects in the Midwest, and Garnett agreed to forgo an ownership interest in BCR. But when Blue Chip III, LLC (BCIII), was formed to operate a repair facility in the Midwest, Lerner told Garnett that he “was not getting anything.” Ark-Mo filed a suit in a Missouri state court against Lerner, alleging breach of contract. Was there consideration to support the Telephone Deal? Explain. [Arkansas-Missouri Forest Products, LLC v. Lerner, __ S.W.3d __, 2016 WL 234889 (Mo.App. E.D. 2016)] (See Agreements That Lack Consideration.)14–1. Covenants Not to Compete. A famous New York City hotel, Hotel Lux, is noted for its food as well as its luxury accommodations. Hotel Lux contracts with a famous chef, Chef Perlee, to become its head chef at $30,000 per month. The contract states that should Perlee leave the employment of Hotel Lux for any reason, he will not work as a chef for anyhotel or restaurant in New York, New Jersey, or Pennsylvania for a period of one year. During the first six months of the con tract, Hotel Lux heavily advertises Perlee as its head chef, and business at the hotel is excellent. Then a dispute arises between the hotel’s management and Perlee, and Perlee terminates his employment. One month later, he is hired by a famous New Jersey restaurant just across the New York state line. Hotel Lux learns of Perlee’s employment through a large advertisement in a New York City newspaper. It seeks to enjoin (prevent) Perlee from working in that restaurant as a chef for one year. Discuss how successful Hotel Lux will be in its action. (See Legality.)14–2. Capacity. Joanne is a seventy-five-year-old widow who survives on her husband’s small pension. Joanne has become increasingly forgetful, and her family worries that she may have Alzheimer’s disease (a brain disorder that seri ously affects a person’s ability to carry out daily activities). No physician has diagnosed her, however, and no court has ruled on her legal competence. One day while she is out shopping, Joanne stops by a store that is having a sale on pianos and enters into a fifteen-year installment contract to buy a grand piano. When the piano arrives the next day, Joanne seems con fused and repeatedly asks the delivery person why a piano is being delivered. Joanne claims that she does not recall buying a piano. Explain whether this contract is void, voidable, or valid. Can Joanne avoid her contractual obligation to buy the piano? If so, how? (See Contractual Capacity.)14–6. Minors. D.V.G. (a minor) was injured in a one-car auto accident in Hoover, Alabama. The vehicle was covered by an insurance policy issued by Nationwide Mutual Insurance Co. Stan Brobston, D.V.G.’s attorney, accepted Nationwide’s offer of $50,000 on D.V.G.’s behalf. Before the settlement could be submitted to an Alabama state court for approval, D.V.G. died from injuries received in a second, unrelated auto accident. Nationwide argued that it was not bound to the settlement, because a minor lacks the capacity to contract and so cannot enter into a binding settlement without court approval. Should Nationwide be bound to the settlement? Why or why not? [Nationwide Mutual Insurance Co. v. Wood, 121 So.3d 982 (Ala. 2013)] (See Contractual Capacity.)14–8. Legality. Sue Ann Apolinar hired a guide through Arkansas Valley Adventures, LLC, for a rafting excursion on the Arkansas River. At the outfitter’s office, Apolinar signed a release that detailed potential hazards and risks, including “overturning,” “unpredictable currents,” “obstacles” in the water, and “drowning.” The release clearly stated that her signature discharged Arkansas Valley from liability for all claims arising in connection with the trip. On the river, while attempting to maneuver around a rapid, the raft capsized. The current swept Apolinar into a logjam where, despite efforts tosave her, she drowned. Her son, Jesus Espinoza, Jr., filed a suit in a federal district court against the rafting company, alleging negligence. What are the arguments for and against enforcing the release that Apolinar signed? Discuss. [Espinoza v. Arkansas Valley Adventures, LLC, 809 F.3d 1150 (10th Cir. 2016)] (See Legality.)15–1. Undue Influence. Juan is an elderly man who lives with his nephew, Samuel. Juan is totally dependent on Sam uel’s support. Samuel tells Juan that unless he transfers a tract of land he owns to Samuel for a price 35 percent below its market value, Samuel will no longer support and take care of him. Juan enters into the contract. Discuss fully whether Juan can set aside this contract. (See Undue Influence.) 15–2. Fraudulent Misrepresentation. Grano owns a forty-room motel on Highway 100. Tanner is interested in purchasing the motel. During the course of negotiations, Grano tells Tanner that the motel netted $30,000 during the previous year and that it will net at least $45,000 the next year. The motel books, which Grano turns over to Tanner before the purchase, clearly show that Grano’s motel netted only $15,000 the previous year. Also, Grano fails to tell Tan ner that a bypass to Highway 100 is being planned that will redirect most traffic away from the front of the motel. Tan ner purchases the motel. During the first year under Tanner’s operation, the motel nets only $18,000. At this time, Tan ner learns of the motel’s previous low profits and the planned bypass. Tanner wants Grano to return the purchase price. Dis cuss fully Tanner’s probable success in getting his funds back. (See Fraudulent Misrepresentation.)15–4. Fraudulent Misrepresentation. Ricky and Sherry Wilcox hired Esprit Log and Timber Frame Homes to build a log house, which the Wilcoxes intended to sell. They paid Esprit $125,260 for materials and services. They eventually sold the home for $1,620,000 but sued Esprit due to con struction delays. The logs were supposed to arrive at the con struction site precut and predrilled, but that did not happen. It took five extra months to build the house while the logs were cut and drilled one by one. The Wilcoxes claimed that the interest they paid on a loan for the extra construction time cost them about $200,000. The jury agreed and awarded them that much in damages, plus $250,000 in punitive dam ages and $20,000 in attorneys’ fees. Esprit appealed, claim ing that the evidence did not support the verdict because the Wilcoxes had sold the house for a good price. Is Esprit’s argument credible? Why or why not? How should the court rule? [Esprit Log and Timber Frame Homes, Inc. v. Wilcox, 302 Ga.App. 550, 691 S.E.2d 344 (2010)] (See Fraudulent Misrepresentation.)15–6. Standard-Form Contracts. David Desgro hired Paul Pack to inspect a house that Desgro wanted to buy. Pack had Desgro sign a standard-form contract that included a twelve-month limit for claims based on the agreement. Pack reported that the house had no major problems, but after Des gro bought it, he discovered issues with the plumbing, insu lation, heat pump, and floor support. Thirteen months after the inspection, Desgro filed a suit in a Tennessee state court against Pack. Was Desgro’s complaint filed too late, or was the contract’s twelve-month limit unenforceable? Discuss. [Desgro v. Pack, 2013 WL 84899 (Tenn.App. 2013)] (See Adhesion Contracts and Unconscionability.)16–1. The One-Year Rule. On May 1, by telephone, Yu offers to hire Benson to perform personal services. On May 5, Benson returns Yu’s call and accepts the offer. Discuss fully whether this contract falls under the Statute of Frauds in the following circumstances: (See Contracts That Require a Writing.) (a) The contract calls for Benson to be employed for one year, with the right to begin performance immediately. (b) The contract calls for Benson to be employed for nine months, with performance of services to begin on Sep tember 1.(c) The contract calls for Benson to submit a written research report, with a deadline of two years for submission. 16–2. Collateral Promises. Mallory promises a local hard ware store that she will pay for a lawn mower that her brother is purchasing on credit if the brother fails to pay the debt. Must this promise be in writing to be enforceable? Why or why not? (See Contracts That Require a Writing.) 16–3. The Parol Evidence Rule. Evangel Temple Assem bly of God leased a facility from Wood Care Centers, Inc., to house evacuees who had lost their homes in Hurricane Katrina. One clause in the lease contract said that Evangel could terminate the lease at any time by giving Wood Care notice and paying 10 percent of the balance remaining on the lease. Another clause stated that if the facility was not given a property tax exemption (as a church), Evangel had the option to terminate the lease without making the 10 percent payment. Nine months later, the last of the evacuees left the facility, and Evangel notified Wood Care that it would end the lease. Wood Care demanded the 10 percent payment. Is parol evidence admissible to interpret this lease? Why or why not? [Wood Care Centers, Inc. v. Evangel Temple Assembly of God of Wichita Falls, 307 S.W.3d 816 (Tex.App.—Fort Worth 2010)] (See The Parol Evidence Rule.)16–6. Promises Made in Consideration of Marriage. After twenty-nine years of marriage, Robert and Mary LouTut tle were divorced. They admitted in court that before they were married, they had signed a prenuptial agreement. They agreed that the agreement had stated that each would keep his or herown property and anything derived from that property. Rob ert came into the marriage owning farmland, while Mary Lou owned no real estate. During the marriage, ten different parcels of land, totaling about six hundred acres, were acquired, and two corporations, Tuttle Grain, Inc., and Tuttle Farms, Inc., were formed. A copy of the prenuptial agreement could not be found. Can the court enforce the agreement without a writing? Why or why not? [In re Marriage of Tuttle, 2013 WL 164035 (Ill.App. 5 Dist. 2013)] (See Contracts That Require a Writing.)17–1. Assignment. Five years ago, Hensley purchased a house. At that time, being unable to pay the full purchase price, she borrowed funds from Thrift Savings and Loan, which in turn took a mortgage at 6.5 percent interest on the house. The mortgage contract did not prohibit the assign ment of the mortgage. Then Hensley secured a new job in another city and sold the house to Sylvia. The purchase price included payment to Hensley of the value of her equity and the assumption of the mortgage debt still owed to Thrift. At the time the contract between Hensley and Sylvia was made, Thrift did not know about or consent to the sale. On the basis of these facts, if Sylvia defaults in making the mortgage pay ments to Thrift, what are Thrift’s rights? Discuss. (See Assign ments and Delegations.) 17–2. Assignment. Marsala, a college student, signs a one year lease agreement that runs from September 1 to August 31. The lease agreement specifies that the lease cannot be assigned without the landlord’s consent. In late May, Marsala decides not to go to summer school and assigns the balance of the lease (three months) to a close friend, Fred. The land lord objects to the assignment and denies Fred access to the apartment. Marsala claims that Fred is financially sound and should be allowed the full rights and privileges of an assignee. Business Case Problems Discuss fully who is correct, the landlord or Marsala. (See Assignments and Delegations.) 17–3. Third Party Beneficiaries. Wilken owes Rivera $2,000. Howie promises Wilken that he will pay Rivera the $2,000 in return for Wilken’s promise to give Howie’s children guitar lessons. Is Rivera an intended beneficiary of the Howie Wilken contract? Explain. (See Third Party Beneficiaries.) 17–4. Delegation. Inez has a specific set of plans to build a sailboat. The plans are detailed, and any boatbuilder can con struct the boat. Inez secures bids, and the low bid is made by the Whale of a Boat Corp. Inez contracts with Whale to build the boat for $4,000. Whale then receives unexpected business from elsewhere. To meet the delivery date in the con tract with Inez, Whale delegates its obligation to build the boat, without Inez’s consent, to Quick Brothers, a reputable boatbuilder. When the boat is ready for delivery, Inez learns of the delegation and refuses to accept delivery, even though the boat is built to her specifications. Discuss fully whether Inez is obligated to accept and pay for the boat. Would your answer be any different if Inez had not had a specific set of plans but had instead contracted with Whale to design and build a sail boat for $4,000? Explain. (See Assignments and Delegations.)18–1. Conditions of Performance. The Caplans contract with Faithful Construction, Inc., to build a house for them for $360,000. The specifications state “all plumbing bowls and fix .. to be Crane brand.” The Caplans leave on vacation, and during their absence, Faithful is unable to buy and install Crane plumbing fixtures. Instead, Faithful installs Kohler brand fixtures, an equivalent in the industry. On completion of the building contract, the Caplans inspect the work, discover the substitution, and refuse to accept the house, claiming Faithful has breached the conditions set forth in the specifications. Dis cuss fully the Caplans’ claim. (See Conditions.) 18–2. Discharge by Agreement. Junior owes creditor Iba $1,000, which is due and payable on June 1. Junior has been in a car accident, has missed a great deal of work, and con sequently will not have the funds on June 1. Junior’s father, Fred, offers to pay Iba $1,100 in four equal installments if Iba will discharge Junior from any further liability on the debt. Iba accepts. Is this transaction a novation or an accord and tures . satisfaction? Explain. (See Discharge by Agreement.) 18–3. Impossibility of Performance. In the follow ing situations, certain events take place after the contracts are formed. Discuss which of these contracts are discharged because the events render the contracts impossible to perform. (See Discharge by Operation of Law.) (a) Jimenez, a famous singer, contracts to perform in your nightclub. He dies prior to performance. (b) Raglione contracts to sell you her land. Just before title is to be transferred, she dies. (c) Oppenheim contracts to sell you one thousand bushels of apples from her orchard in the state of Washington. Because of a severe frost, she is unable to deliver the apples. (d) Maxwell contracts to lease a service station for ten years. His principal income is from the sale of gasoline. Because of an oil embargo by foreign oil-producing nations, gaso line is rationed, cutting sharply into Maxwell’s gasoline sales. He cannot make his lease payments. 18–4. Business Case Problem with Sample Answer— Material Breach. The Northeast Independent School District in Bexar County, Texas, hired STR Constructors, Ltd., to renovate a middle school. STR subcon tracted the tile work in the school’s kitchen to New man Tile, Inc. (NTI). The project had already fallen behind schedule. As a result, STR allowed other workers to walk over and damage the newly installed tile before it had cured, forcing NTI to constantly redo its work. Despite NTI’s requests for payment, STR remitted only half the amount due under their contract. When the school district refused to accept the kitchen, including the tile work, STR told NTI to quickly make repairs. A week later, STR terminated their contract. Did STR breach the contract with NTI? Explain. [STR Constructors, Ltd. v. Newman Tile, Inc., 395 S.W.3d 383 (Tex.App.—El Paso 2013)] (See Discharge by Performance.)19–1. Liquidated Damages. Cohen contracts to sell his house and lot to Windsor for $100,000. The terms of the contract call for Windsor to pay 10 percent of the purchase price as a down payment. The terms further stipulate that if the buyer breaches the contract, Cohen will retain the deposit as liquidated damages. Windsor pays the deposit, but because her expected financing of the $90,000 balance falls through, she breaches the contract. Two weeks later, Cohen sells the house and lot to Ballard for $105,000. Windsor demands her $10,000 back, but Cohen refuses, claiming that Windsor’s breach and the contract terms entitle him to keep the deposit. Discuss who is correct. (See Damages.) 19–2. Specific Performance. In which of the following situations would specific performance be an appropriate rem edy? Discuss fully. (See Equitable Remedies.) (a) Thompson contracts to sell her house and lot to Cousteau. Then, on finding another buyer willing to pay a higher pur chase price, she refuses to deed the property to Cousteau. (b) Amy contracts to sing and dance in Fred’s nightclub for one month, beginning May 1. She then refuses to perform. (c) Hoffman contracts to purchase a rare coin owned by Erik son, who is breaking up his coin collection. At the last minute, Erikson decides to keep his coin collection intact and refuses to deliver the coin to Hoffman. (d) ABC Corp. has three shareholders: Panozzo, who owns 48 percent of the stock; Chang, who owns another 48 percent; and Ryan, who owns 4 percent. Ryan contracts to sell her 4 percent to Chang. Later, Ryan refuses to transfer the shares to Chang. 19–3. Liquidated Damages and Penalties. Planned Pet hood Plus, Inc., is a veterinarian-owned clinic. It borrowed $389,000 from KeyBank at an interest rate of 9.3 percent per year for ten years. The loan had a “prepayment penalty” clause that clearly stated that if the loan was repaid early, a specific formula would be used to assess a lump-sum payment to extinguish the obligation. The sooner the loan was paid off, the higher the prepayment penalty. After a year, the veterinar ians decided to pay off the loan. KeyBank invoked a prepay ment penalty of $40,525.92, which was equal to 10.7 percent of the balance due. The veterinarians sued, contending that the prepayment requirement was unenforceable because it was a penalty. The bank countered that the amount was not a penalty but liquidated damages and that the sum was reason able. The trial court agreed with the bank, and the veterinar ians appealed. Was the loan’s prepayment charge reasonable, and should it have been enforced? Why or why not? [Planned Pethood Plus, Inc. v. KeyCorp, Inc., 228 P.3d 262 (Colo.App. 2010)] (See Damages.) 19–4. Measure of Damages. Before buying a house, Dean and Donna Testa hired Ground Systems, Inc. (GSI), to inspect the sewage and water disposal system. GSI reported a split system with a watertight septic tank, a wastewater tank, a distribution box, and a leach field. The Testas bought the house. Later, Dean saw that the system was not as GSI described—there was no distribution box or leach field, and there was only one tank, which was not watertight. The Tes tas arranged for the installation of a new system and sold the house. Assuming that GSI is liable for breach of contract, what is the measure of damages? [Testa v. Ground Systems, Inc., 206 N.J. 330, 20 A.3d 435 (App.Div. 2011)] (See Damages.)25–1. Agency Formation. Paul Gett is a well-known, wealthy financial expert living in the city of Torris. Adam Wade, Gett’s friend, tells Timothy Brown that he is Gett’s agent for the purchase of rare coins. Wade even shows Brown a local newspaper clipping mentioning Gett’s interest in coin collecting. Brown, knowing of Wade’s friendship with Gett, contracts with Wade to sell a rare coin valued at $25,000 to Gett. Wade takes the coin and disappears with it. On the pay ment due date, Brown seeks to collect from Gett, claiming that Wade’s agency made Gett liable. Gett does not deny that Wade was a friend, but he claims that Wade was never his agent. Discuss fully whether an agency was in existence at the time the contract for the rare coin was made. (See Formation of the Agency Relationship.) 25–2. Duty of Loyalty. Peter hires Alice as an agent to sell a piece of property he owns. The price is to be at least $30,000. Alice discovers that the fair market value of Peter’s property is actually at least $45,000 and could be higher because a shopping mall is going to be built nearby. Alice forms a real estate partnership with her cousin Carl. Then she prepares for Peter’s signature a contract for the sale of the property to Carl for $32,000. Peter signs the contract. Just before closing and passage of title, Peter learns about the shopping mall and the increased fair market value of his property. Peter refuses to deed the property to Carl. Carl claims that Alice, as Peter’s agent, solicited a price above that agreed on when the agency was created and that the contract is therefore binding and enforceable. Discuss fully whether Peter is bound to this con tract. (See Duties of Agents and Principals.) 25–3. Employee versus Independent Contractor. Ste phen Hemmerling was a driver for the Happy Cab Co. Hem merling paid certain fixed expenses and followed various rules benefits in a state court. Such benefits are not available to independent contractors. On what basis might the court hold that Hem merling was an employee? Explain. (See Agency Relationships.) 25–4. Agency by Ratification. Wesley Hall, an indepen dent contractor managing property for Acree Investments, Ltd., lost control of a fire he had set to clear ten acres of Acree land. The runaway fire burned seventy-eight acres of Earl Barrs’s property. Russell Acree, one of the owners of Acree Investments, had previously owned the ten acres, but he had put it into the company and was no longer the principal owner. Hall had worked for Russell Acree in the past and had told the state for estry department that he was burning the land for Acree. Barrs sued Russell Acree for the acts of his agent, Hall. In his suit, Barrs noted that Hall had been an employee of Russell Acree, Hall had talked about burning the land “for Acree,” and Russell Acree had apologized to Barrs for the fire. Barrs also pointed out that Acree Investments had not been identified as the principal property owner until Barrs filed his lawsuit. Barrs argued that those facts were sufficient to create an agency by ratification to impose liability on Russell Acree. Was Barrs’s agency by ratifica tion claim valid? Why or why not? [Barrs v. Acree, 691 S.E.2d 575 (Ga.App. 2010)] (See Formation of the Agency Relationship.)26–1. Unauthorized Acts. Janell Arden is a purchasing agent–employee for the A&B Coal Supply partnership. Arden has authority to purchase the coal needed by A&B to satisfy the needs of its customers. While Arden is leaving a coal mine from which she has just purchased a large quantity of coal, her car breaks down. She walks into a small roadside grocery store for help. While there, she encounters Will Wilson, who owns 360 acres back in the mountains with all mineral rights. Wilson, in need of cash, offers to sell Arden the property for $1,500 per acre. On inspection of the property, Arden forms the opinion that the subsurface contains valuable coal deposits. Arden contracts to purchase the property for A&B Coal Supply, signing the contract “A&B Coal Supply, Janell Arden, agent.” The closing date is August 1. Arden takes the contract to the partnership. The managing partner is furious, as A&B is not in the property business. Later, just before closing, both Wil son and the partnership learn that the value of the land is at least $15,000 per acre. Discuss the rights of A&B and Wilson concerning the land contract. (See Liability for Contracts.) 26–2. Respondeat Superior. ABC Tire Corp. hires Arnez as a traveling salesperson and assigns him a geographic area and time schedule in which to solicit orders and service cus tomers. Arnez is given a company car to use in covering the territory. One day, Arnez decides to take his personal car to cover part of his territory. It is 11:00 a.m., and Arnez has just finished calling on all customers in the city of Tarrytown. His next appointment is at 2:00 p.m. in the city of Austex, twenty miles down the road. Arnez starts out for Austex, but halfway there he decides to visit a former college roommate who runs a farm ten miles off the main highway. Arnez is enjoying his visit with his former roommate when he realizes that it is 1:45 p.m. and that he will be late for the appointment in Austex. Driving at a high speed down the country road to reach the main highway, Arnez crashes his car into a tractor, severely injuring Thomas, the driver of the tractor. Thomas claims that he can hold ABC Tire Corp. liable for his injuries. Discuss fully ABC’s liability in this situation. (See Liability for Torts and Crimes.) 26–3. Liability Based on Apparent Authority. Sum merall Electric Co. and other subcontractors were hired by National Church Services, Inc. (NCS), which was the general contractor on a construction project for the Church of God at Southaven. As work progressed, payments from NCS to the subcontractors were late and eventually stopped altogether. The church had paid NCS in full for the entire project before hand, but apparently NCS had mismanaged the project. When payments from NCS stopped, the subcontractors filed mechanic’s liens for the value of the work they had performedbut for which they had not been paid. The subcontractors sued the church, contending that it was liable for the pay ments because NCS was its agent on the basis of either actual or apparent authority. Was NCS an agent for the church, thereby making the church liable to the subcontractors? Explain your reasoning. [Summerall Electric Co. v. Church of God at Southaven, 25 So.3d 1090 (Miss.App. 2010)] (See Scope of Agent’s Authority.)26–5. Liability for Contracts. Thomas Huskin and his wife entered into a contract to have their home remodeled by House Medic Handyman Service. Todd Hall signed the contract as an authorized representative of House Medic. It turned out that House Medic was a fictitious name for Hall Hauling, Ltd. The contract did not indicate this, however, and Hall did not inform the Huskins about Hall Hauling. When a contract dispute later arose, the Huskins sued Todd Hall per sonally for breach of contract. Can Hall be held personally liable? Why or why not? [Huskin v. Hall, 2012 WL 553136 (Ohio Ct.App. 2012)] (See Liability for Contracts.)27–1. Unfair Labor Practices. Consolidated Stores is undergoing a unionization campaign. Prior to the union election, management states that the union is unnecessary to protect workers. Management also provides bonuses and wage increases to the workers during this period. The employ ees reject the union. Union organizers protest that the wage increases during the election campaign unfairly prejudiced the vote. Should these wage increases be regarded as an unfair labor practice? Discuss. (See Labor Unions.) 27–2. Wrongful Discharge. Denton and Carlo were employed at an appliance plant. Their job required them to perform occasional maintenance work while standing on a wire mesh twenty feet above the plant floor. Other employ ees had fallen through the mesh, and one of them had been killed by the fall. When their supervisor told them to perform tasks that would likely involve walking on the mesh, Denton and Carlo refused because they feared they might suffer bodily injury or death. Because they refused to do the requested work, the two employees were fired from their jobs. Was their discharge wrongful? If so, under what federal employment law? To what federal agency or department should they turn for assistance? (See Employment at Will.) 27–3. Workers’ Compensation. As a safety measure, Dynea USA, Inc., required an employee, Tony Fairbanks, to wear steel-toed boots. One of the boots caused a sore on Fairbanks’s leg. The skin over the sore broke, and within a week, Fairbanks was hospitalized with a methicillin-resistant staphylococcus aureus (MRSA) infection. He filed a workers’ compensation claim. Dynea argued that the MRSA bacteria that caused the infection had been on Fairbanks’s skin before he came to work. What are the requirements to recover workers’ compensation benefits? Does this claim qualify? Explain. [Dynea USA, Inc. v. Fairbanks, 241 Or.App. 311, 250 P.3d 389 (2011)] (See Health, Safety, and Income Security.)27–7. Labor Unions. Carol Garcia and Pedro Salgado were bus drivers for Latino Express, Inc., a transportation company. Garcia and Salgado began soliciting signatures from other driv ers to certify the Teamsters Local Union No. 777 as the official representative of the employees. Latino Express fired Garcia and Salgado. The two drivers filed a claim with the National Labor Relations Board (NLRB), alleging that the employer had com mitted an unfair labor practice. Which employer practice defined by the National Labor Relations Act did the plaintiffs most likely charge Latino Express with committing? Is the employer’s dis charge of Garcia and Salgado likely to be construed as a legit imate act in opposition to union solicitation? If a violation is found, what can the NLRB do? Discuss. [Ohr v. Latino Express, Inc., 776 F.3d 469 (7th Cir. 2015)] (See Labor Unions.)28–1. Title VII Violations. Discuss fully whether either of the following actions would constitute a violation of Title VII of the 1964 Civil Rights Act, as amended: (See Title VII of the Civil Rights Act.) (a) Tennington, Inc., is a consulting firm with ten employ ees. These employees travel on consulting jobs in seven states. Tennington has an employment record of hiring only white males. (b) Novo Films is making a movie about Africa and needs to employ approximately one hundred extras for this picture. To hire these extras, Novo advertises in all major newspa pers in Southern California. The ad states that only Afri can Americans need apply. 28–2. Religious Discrimination. Gina Gomez, a devout Roman Catholic, worked for Sam’s Department Stores, Inc., in Phoenix, Arizona. Sam’s considered Gomez a productive employee because her sales exceeded $200,000 per year. At the time, the store gave its managers the discretion to grant unpaid leave to employees but prohibited vacations or leave during the holiday season—October through December. Gomez felt that she had a “calling” to go on a “pilgrimage” in October to a loca tion in Bosnia where some persons claimed to have had visions of the Virgin Mary. The Catholic Church had not designated the site an official pilgrimage site, the visions were not expected to be stronger in October, and tours were available at other times. The store managers denied Gomez’s request for leave, but she had a nonrefundable ticket and left anyway. Sam’s ter minated her employment, and she could not find another job. Can Gomez establish a prima facie case of religious discrimina tion? Explain. (See Title VII of the Civil Rights Act.) 28–3. Spotlight on Dress Code Policies—Discrimina tion Based on Gender. Burlington Coat Fac tory Warehouse, Inc., had a dress code that required male salesclerks to wear business attire consisting of slacks, shirt, and a necktie. Female salesclerks, by contrast, were required to wear a smock so that customers could readily identify them. Karen O’Donnell and other female employees refused to wear smocks. Instead they reported to work in business attire and were suspended. After numerous suspensions, the female employees were fired for violating Burlington’s dress code policy. All other conditions of employment, including salary, hours, and ben efits, were the same for female and male employees. Was the dress code policy discriminatory? Why or why not? [O’Donnell v. Burlington Coat Factory Warehouse, Inc., 656 F.Supp. 263 (S.D. Ohio 1987)] (See Title VII of the Civil Rights Act.)28–6. Discrimination Based on Disability. Cynthia Horn worked for Knight Facilities Management–GM, Inc., in Detroit, Michigan, as a janitor. When Horn developed a sensitivity to cleaning products, her physician gave her a “no exposure to cleaning solutions” restriction. Knight discussed possible accommodations with Horn. She suggested that rest rooms be eliminated from her cleaning route or that she be provided with a respirator. Knight explained that she would be exposed to cleaning solutions in any situation and concluded that there was no work available within her physician’s restric tion. Has Knight violated the Americans with Disabilities Act by failing to provide Horn with the requested accommoda tions? Explain. [Horn v. Knight Facilities Management–GM, Inc., 556 Fed.Appx. 452 (6th Cir. 2014)] (See Discrimination Based on Disability.) 1) Facts – State the important facts of the case.

2) Issue(s)- State the issue or issues that are being brought before the court.

3) Rules- State the rule of law as it applies to the issue.

4) Analysis

5) Conclusion

to support your answers.

do not include no sources