equity contracts – prof. merges march 29, 2011
TRANSCRIPT
Equity
Contracts – Prof. Merges
March 29, 2011
Bent's Camp Resort, Restaurant and Bar6882 Helen Creek Road, Land O' Lakes, WI 54540
(715) 547-3487E-mail Address: [email protected]
Year Round Rentals on Mamie Lake of the famous Cisco Chain of Lakes
"Attractions of the beautiful northwoods are to be found at Bent's Camp. Woods and water, glorious sunshine and deep shadow gives rest to those seeking relief, brings health to the worn out, and affords a region of delight to the outer and nature lover."Charles A Bent
Review: Equity Jurisdiction – Specific Performance
• What is the difference between “legal” and “equitable” proceedings?
• What determines which “side” of the ledger you are on?
Forms of Action: Writs
MacKinnon v. Benedict
• Facts
• Procedural History
MacKinnon
• What was the deal?
• What were the motives of the parties in making it?
MacKinnon
• Why did Mr. MacKinnon seek SP?
• What would damages in an action at law have been?
MacKinnon
• Why did Mr. MacKinnon seek SP?
• What would damages in an action at law have been?
p. 456 n.1
Would MacKinnon have been satisfied with $50,000 as compensation for the trailer and tent park?
Opinion
• Restrictions on land use are “disfavored” – why?
Opinion
• Restrictions on land use are “disfavored” – why?
– Encumbrances on land “gum up” the market; create uncertainty . . .
– Common law origins: unique place and value of land in medieval/Tudor British society . . .
Sufficiency/adequacy of consideration
• Why relevant?
• Is it always relevant?
• Why not?
Consideration Analysis
• What was the ¢ for the Benedicts’ agreement?
• What was the ¢ for MacKinnon’s agreement?
Benedicts MacKinnon
P. 455: “The only monetary consideration was the granting of a $5000 loan for seven months, interest free . . .”
Other factors
• Difference in situation and experience of parties
• Benedicts’ “great need”
Do you agree it was a one-sided deal?
• Why or why not?
Do you agree it was a one-sided deal?
• Why or why not?
–MacKinnon couldn’t see camp: only relevant issue?
– Risk issue: not discussed . . .
What is the holding?
What is the holding?
“We find that the inadequacy of consideration is so gross as to be unconscionable and a bar to the plaintiff’s invocation of the extraordinary equitable powers of the court.”
-- P. 456
Tuckwiller v. Tuckwiller
• Facts
• Procedural History
Tuckwiller
• When was K executed?
• When did Mrs. Tuckwiller die?
• What was the deal between Ruby and Metta?
Opinion
• What perspective does the court take on the contract?
Opinion
• What perspective does the court take on the contract?
• “Prospective . . . Not retrospective” – p. 458-459
Prospective view
• Fair or not?
Prospective view
• Fair or not?
• How would this have applied in the MacKinnon case?
Black Indus. v. Bush
• Facts
• Procedural History
Black Industries (Gepfert)
G.F. Bush Assoc.
Machine parts
Hoover Co.
U.S. Govt.
Finished products – war effort
Black Industries (Gepfert)
G.F. Bush Assoc.
Machine parts
Hoover Co.
U.S. Govt.
Finished products – war effort
“Pass through” provisions
Pass-through provisions
• Why did Black not want Bush to see payments from Hoover/Gov’t?
• Why did Black want Hoover/Gov’t to think it was doing business directly with Bush?
Illegality/Public policy
• 3 categories of unenforceable K’s, p. 461
Illegality/Public policy
• 3 categories of unenforceable K’s, p. 321
1. K to induce public official (bribe)
2. K to do an illegal act
3. K to collude on price fixing
Extent of “markups” or “margins”
• Relevant?
• Should they be?
Downside of invalidating K
• “Impose price regulatory function on court”?
• P. 461: “Good faith K’s of the US should not be lightly invalidated”
Why not?