CALIFORNIA REMEDIES ESSAY WORKSHOP PROFESSOR CHRISTOPHER IDE-DON UC DAVIS SCHOOL OF LAW
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1 CALIFORNIA REMEDIES ESSAY WORKSHOP PROFESSOR CHRISTOPHER IDE-DON UC DAVIS SCHOOL OF LAW CHAPTER 1: APPROACH; ISSUES TESTED A. Apprach t Essays 1) Determine and analyze the cause(s) f actin in the questin 2) Discuss legal damages (mney damages) and limitatins 3) Discuss equitable remedies and equitable defenses 4) Discuss restitutin-based remedies (legal and equitable) and defenses (equitable) B. Summary f the Issues Tested 1. Causes f Actin Cntracts: Anticipatry Repudiatin and/r Breach f Cntract related t Sale f Land, Persnal Prperty, Building (Cnstructin), Emplyment, and Mistake Trts: Harm t Land; Harm t Persnal Prperty; Misapprpriatin f Mney; Persnal Injury; Financial Harm 2. Mney Damages (Legal Remedies) Causatin, Freseeability, Certainty, Avidable Cnsequences (Duty t Mitigate) 3. Equitable Remedies Injunctive Relief and Defenses (Trts and Cntracts) Specific Perfrmance, Rescissin, Refrmatin (Cntracts) Equitable Defenses (Trts and Cntracts) Cmpensatry (Trts and Cntracts) Cnsequential (Trts and Cntracts) Reliance (Cntracts) Incidental (Cntracts) Nminal (Trts and Cntracts) Punitive (Trts, rarely Cntracts) Restitutin (Trts and Cntracts) Limitatins n damages Unclean Hands; Laches 4. Restitutin (Legal and Equitable Remedies) Mney Damages Cnstructive Trust/Equitable Lien Replevin Equitable Defenses
2 C. Causes f Actin The exam questin may require yu t analyze the cause f actin that is the basis f the remedies being sught by the party(s). Read the fact pattern carefully and determine if yu are being asked t discuss the underlying causes f actin, r if yu are nly being asked t discuss the ptential remedies. 1. Cntracts (Frequently tested) Cntracts and Remedies are frequently tested tgether. The typical questin invlves the anticipatry repudiatin r breach f a cntract. Yu must analyze the anticipatry repudiatin r breach first, and then discuss ptential remedies. In past questins, yu were asked t discuss the remedies available t bth parties (nn-breaching and breaching). The cntract usually invlves the Sale f Land, Persnal Prperty, Building (Cnstructin), Emplyment, r Mistake. 2. Trts When Trts and Remedies are tested tgether, the trts include: Trespass t Land, Trespass t Chattels, Cnversin, Nuisance (Public/Private), Misapprpriatin f Mney, Intentinal Trts and Negligence that harm a persn, and Fraud (Intentinal Misrepresentatin). Yu shuld analyze each trt ne at a time and discuss the relevant remedies fr each trt. 3. Legal Remedies and Equitable Remedies The typical Remedies questin will ask yu t discuss Legal Remedies and Equitable Remedies. Fr purpses f the CA bar, Legal Remedies generally refers t mney damages and Equitable Remedies generally refers t curt rdered remedies, such as injunctins and specific perfrmance. Restitutin-based Remedies are based n unjust enrichment and include Legal and Equitable Remedies. Yu shuld discuss bth Legal Remedies and Equitable Remedies (including Restitutin-based Remedies), unless the questin clearly limits yu t ne type f remedies. D. Mney Damages (Legal Remedies) Exam Tip 1: When analyzing mney damages, be sure t use the specific dllar amunts prvided in the questin and explain the math (additin/subtractin) that yu are using t determine the amunt f mney damages t be awarded t the party(s). 1. Cmpensatry Damages (Trts and Cntracts) Always discuss Cmpensatry Damages Trts: In a trt actin, cmpensatry damages cmpensate a plaintiff fr harm r injury. These damages include pain and suffering, medical expenses, and lst wages Themis Bar Review, LLC CA Remedies Essay Wrkshp
3 Cntracts: In a breach f cntract actin, cmpensatry damages mst ften take the frm f expectatin damages. They are intended t put the injured party in the same psitin as if the cntract was perfrmed. Generally, the amunt f damages will be based n the cntract price fr perfrmance and the fair market value f perfrmance. Exam Tip 2: After discussing Cmpensatry Damages, discuss all relevant types f damages belw. 2. Cnsequential Damages (Trts and Cntracts) Cnsequential Damages are frequently tested. Cnsequential damages are reasnably freseeable damages ther than expectatin damages that are related t the trt r breach f the cntract (example, lss f prfit). In rder t recver cnsequential damages, three elements must be met: Freseeability: The damages must be natural and prbable cnsequences f the trt r breach f cntract r cntemplated by the parties at the time the cntract was frmed. Causatin: Plaintiff must shw that the damages were caused by the defendant s trt r breach; if the damages wuld have ccurred withut defendant s trt r breach, there can be n recvery. Certainty: Plaintiff must prve the dllar amunt with reasnable certainty. When the amunt f mney is t speculative (example: a new business), the curt will nt award cnsequential damages. Example 1: Based n a past CA bar exam questin: Restaurant enters a cntract with Fisherman fr the delivery f 1,000 punds f crab fr $10 per pund every week. Fisherman catches the crab but decides t sell it t anther buyer instead. After a ne-mnth delay, Restaurant is able t find anther surce fr the crab fr $12 per pund. Restaurant seeks expectatin damages fr the increased cst f the crab $2 per pund and cnsequential damages fr lst business prfits during the ne mnth when it did nt have crab n the menu. 3. Reliance Damages (Cntracts) Damages that nn-breaching party incurs in reasnable reliance upn the prmise that the ther party wuld perfrm. Nte: a party cannt recver reliance and cmpensatry (expectatin) damages; it must chse between reliance r expectatin damages. [Yu shuld discuss bth items f damages n the exam]. 4. Incidental Damages (Cntracts) Damages that arise when the nn-breaching party is trying t remedy the breach. Fr example, in a cmmercial cntract, the cst f finding a replacement seller f gds. CA Remedies Essay Wrkshp 2016 Themis Bar Review, LLC 3
4 5. Nminal (Trts and Cntracts) If a plaintiff established the elements f a cause f actin, but the harm r lss is slight, the plaintiff may be awarded a nminal, r small/trivial amunt f mney. 6. Punitive (Trts, rarely Cntracts) Punitive damages are meant t punish the defendant wh engages in serius miscnduct with an imprper state f mind (such as malice). Punitive damages are usually nt granted in cntract actins, but if the defendant has als cmmitted a trt, punitives may be awarded fr the trtius behavir. 7. Restitutin (Trts and Cntracts) Restitutin damages are measured by the benefit cnferred n the defendant by plaintiff and awarded n an unjust enrichment thery (nt based n trt r breach f cntract). Nte: a party cannt recver restitutin and cmpensatry (expectatin) damages; it must chse between restitutin r expectatin damages. [Yu shuld discuss bth items f damages]. Example 2: Based n a past CA bar exam questin: P agrees t landscape D s husing develpment fr $15,000. The prject will take three mnths t cmplete. Tw mnths int the cntract, D repudiates the cntract. P can seek restitutin damages fr the value f the landscaping he has perfrmed t avid unjust enrichment f D. Or, P can seek cmpensatry damages under the cntract terms. 8. Limitatins n damages When yu discuss each type f mney damages that a party can seek (cmpensatry, cnsequential, reliance, etc.), yu shuld discuss the relevant the limitatins that may apply. a. Causatin Actual (Trts and Cntracts) The defendant must be the actual but fr cause f plaintiff s injuries. b. Causatin Prximate (Trts) In a trts questin, the plaintiff must shw prximate cause. A defendant is nly liable fr harms that were reasnably freseeable at the time defendant breached his duty. Example 3: Frm a past CA bar questin: Plaintiff grants Defendant permissin t mve lgs acrss Plaintiff s prperty during the summer. At the end f the summer Defendant leaves a pile f lgs n Plaintiff s prperty, blcking a small stream n Plaintiff s prperty. In the winter, there is nrmal rainfall and the stream verflws due t the lgs blcking it. The water flds Plaintiff s huse and Plaintiff sues Defendant fr Trespass t Land and Trespass t Chattels fr the damage t his huse. Plaintiff must shw that Defendant is the prximate cause f the damages Themis Bar Review, LLC CA Remedies Essay Wrkshp
5 t his huse (it is freseeable that leaving the lgs in the stream wuld result in fld damage t his huse). c. Certainty (Trts and Cntracts) The plaintiff must establish damages with reasnable certainty. Lst prfits and earnings fr a new business are an example f uncertain damages. d. Avidable Cnsequences - Duty t Mitigate (Trts and Cntracts) The plaintiff has a duty t avid r mitigate its damages, t the extent pssible, by minimizing its harm (seeking medical attentin) r seeking replacements/substitutes fr gds and/r services. The plaintiff will be held t a standard f reasnable cnduct. A failure t mitigate damages will reduce the damages recvered by the plaintiff. CHAPTER 2: SUBSTANTIVE ISSUES CONTINUED A. Equitable Remedies 1. Injunctive Relief (Trts and Cntracts) An injunctin is a curt rder directing a persn t act r refrain frm acting. It can be used t maintain the status qu until further judicial prceedings can take place. Examples frm past CA bar exams: Example 4: Cntracts: P cntracts with D t purchase a unique car frm D. Later, D anticipatrily breaches the cntract when she tells P that she will nt deliver the car t P n the date agreed n in the cntract. Instead, she intends t sell the car t a different buyer fr mre mney. P seeks injunctive relief prhibiting D frm selling the car t the ther buyer. Example 5: Trts: D starts t build a dam acrss a stream that is n her prperty. The dam will prevent water frm flwing t her Neighbrs wh use the water fr farming. The Neighbrs claim that the dam is a nuisance and seek a permanent injunctin requiring D t stp building the dam and remve the part that has been built. a. Prejudgment Injunctins A prejudgment injunctin is sught t prevent irreparable harm t the plaintiff until a curt actin is reslved. The tw types are: TRO and preliminary injunctin. 1) TRO (Temprary Restraining Order): An injunctin issued fr a shrt perid f time (10 days r less) that des nt require ntice t the defendant r an pprtunity t be heard. A TRO is usually issued t maintain the status qu until a preliminary injunctin hearing is held. CA Remedies Essay Wrkshp 2016 Themis Bar Review, LLC 5
6 2) Preliminary Injunctin: An injunctin issues befre r during a trial that is effective until the final judgment f the curt. Defendant must be give ntice and an pprtunity t be heard. T btain a TRO r Preliminary Injunctin, a plaintiff must shw: a) The plaintiff will suffer irreparable harm if the injunctin is nt issued. If mney damages wuld be adequate, there is n irreparable harm. Real prperty and unique items f persnal prperty (a unique piece f art) are examples f when mney damages are inadequate. b) Balancing the hardships: The curt will lk at the hardship n plaintiff if the injunctin is nt issued and the hardship n the defendant (and third parties) if the injunctin is issued. The plaintiff must shw that his hardship utweighs the defendant s. Exam Tip 3: Be sure t thrughly analyze and explain the arguments that the plaintiff and defendant wuld make regarding hardship. Als, remember that a defendant can reference hardship t third parties t help his side f the argument. c) The plaintiff must shw a likelihd f success n the merits. This factr requires a curt t analyze whether plaintiff is likely t win his case against the defendant at trial. Exam Tip 4: This factr requires yu t discuss the plaintiff s underlying cause(s) f actin and explain why he/she is likely t win n them at trial. If yu have already analyzed the cause(s) f actin, yu can briefly state why plaintiff is likely t win at trial. d) Enfrceability: A request fr a TRO r preliminary injunctin may be denied if it is nt feasible fr the curt t enfrce the injunctin. Curts prefer t nt issue injunctins if they require extensive invlvement r cntinued supervisin by the curt. b. Permanent Injunctin After the Plaintiff has wn his/her case, a permanent injunctin is granted t prevent the vilatin f plaintiff s rights r t restre t the plaintiff rights that have been vilated. T btain a permanent injunctin, plaintiff must shw: 1) Irreparable harm if the injunctin is nt granted. (Same as the analysis under Preliminary Injunctin) 2) Her hardships if the injunctin is nt issued will be significantly greater than the hardships n the defendant and third parties if the injunctin is issued. (Same as the analysis under Preliminary Injunctin) Themis Bar Review, LLC CA Remedies Essay Wrkshp
7 2. Specific Perfrmance, Rescissin, Refrmatin a. Specific Perfrmance (Cntracts) Exam Tip 5: Specific Perfrmance is a frequently tested remedy n the exam; yu shuld discuss all elements f the rule t earn full credit. Under the remedy f Specific Perfrmance, the nn-breaching party can ask a curt t rder the breaching party t perfrm the cntract. The fllwing elements must be met: a) There must be a valid cntract. This requires yu t discuss whether a valid cntract (ffer, acceptance, cnsideratin) exists. b) The terms f the cntract must be certain/clear enugh t allw a curt t make an rder. c) The nn-breaching party has satisfied any cnditins precedent (r the cnditin has been excused), s the breaching party s perfrmance is nw due. d) Mney damages are inadequate (this usually means the item(s) invlved in the cntract are unique. Examples f situatins where mney damages are inadequate: Land, pieces f art, antique cars. e) It is feasible fr the curt t enfrce and supervise the breaching party s perfrmance. Curts will nt grant specific perfrmance if it will be required t supervise the perfrmance fr a lng perid f time, r if it will be difficult t enfrce. Specifically, curts will nt require peple t perfrm service cntracts (fr example, emplyment) because it is nt feasible t enfrce/supervise a persn s service and frcing a persn t wrk can rise t the level f indentured servitude under the 13th Amendment. f) N defenses exist: A curt will nt grant specific perfrmance if the breaching party can assert defenses f Laches r Unclean Hands. 3. Rescissin (Trts and Cntracts) Laches: If the nn-breaching party waited an unreasnably lng time t seek specific perfrmance and the delay prejudiced the breaching party, the curt may deny specific perfrmance. Unclean Hands: If the nn-breaching party itself engaged in unethical r immral acts relating t the cntract, the curt may deny specific perfrmance. Rescissin is the avidance r unmaking f a cntract. CA Remedies Essay Wrkshp 2016 Themis Bar Review, LLC 7
8 The plaintiff first must shw grunds fr rescissin (such as mistake f fact, misrepresentatin/fraud). Exam Tip 6: T earn full credit, yu must analyze the mistake f fact r misrepresentatin first t shw a basis fr rescissin, and then discuss the remaining rescissin requirements belw. The plaintiff must give ntice f rescissin t the defendant as sn as the grunds are discvered; and Return r deliver any f the benefits f the cntract it has received frm the defendant. After a curt grants rescissin and rescinds the cntract, a plaintiff can bring actins against the defendant: Replevin (recvery f specific prperty that was transferred t the defendant), r Restitutin (mnetary cmpensatin fr the value f the prperty transferred t defendant). 4. Refrmatin (Cntracts) Refrmatin is the judicial rewriting f a cntract r ther dcument (deed) t reflect the parties true intent. 1) Mutual Mistake: If bth parties were mistaken as t the cntent r effect f a writing, curt may rewrite the cntract. There must have been an agreement reached between the parties prir t the writing. The writing did nt have t be a valid cntract, but it has t be sufficiently certain t permit the curt t restate the writing. 2) Unilateral Mistake: If ne party is mistaken as t the cntent r effect f a writing, refrmatin will be allwed if the ther party is aware f the mistake and either fraudulently induced the mistake r des nthing t crrect the mistake. If the ther party is unaware f the mistake, refrmatin will nt be allwed. 5. Equitable Defenses (Trts and Cntracts) a. Laches: Exam Tip 7: After discussing all relevant Equitable Remedies, yu shuld discuss the Equitable Defenses f Laches and Unclean Hands. If the plaintiff waited an unreasnably lng time t seek specific perfrmance and the delay prejudiced the defendant, the curt may deny equitable relief. b. Unclean Hands: Exam Tip 8: Read the facts carefully fr indicatins f Plaintiff delaying his lawsuit an unreasnable amunt f time. If the plaintiff himself engaged in unethical r immral acts relating t the cntract, the curt may deny equitable relief Themis Bar Review, LLC CA Remedies Essay Wrkshp
9 B. Restitutin (Trts and Cntracts) Restitutin-based remedies are available if the defendant has been unjustly enriched at the plaintiff s expense. The plaintiff must have cnferred a benefit (mney, land) n the defendant and the defendant must have been unjustly enriched (defendant wrngfully acquired the benefit). Legal and Equitable Remedies are available under a Restitutin thery. 1. Mney Damages (Legal Remedy) Restitutin damages are measured by the benefit cnferred n the defendant by plaintiff. If the defendant received mney frm the plaintiff, the benefit cnferred is the amunt f mney plaintiff paid defendant. If the defendant received gds r services frm the plaintiff, the benefit cnferred can be based n: The cst t the plaintiff f prviding the benefit The market value f the benefit The price listed in the agreement between the parties 2. Cnstructive Trust/Equitable Lien (Equitable Remedy) A cnstructive trust is a judicially created remedy that impses a duty t cnvey specific prperty t the plaintiff if the defendant wuld be unjustly enriched by retaining the prperty. Example 6: Based n a past CA essay: Defendant embezzles mney frm Plaintiff and buys a huse with the mney. Plaintiff can trace his mney t its new frm (the huse) and btain a cnstructive trust ver the huse. Plaintiff wuld take title t the huse and receive any increased value in the huse that had ccurred. Plaintiff must shw: 1) The defendant hlds title t the prperty that is t be subject t the cnstructive trust; The defendant must have title t seek a cnstructive trust against him/her. If the defendant transfers the title t a third party, a cnstructive trust can be sught against him/her unless she is a bna fide purchaser (a purchaser fr value wh takes the prperty withut knwledge f defendant s wrngding). 2) The defendant s retentin f the prperty wuld unjustly enrich the defendant; and 3) The legal remedy is inadequate (mney damages are nt adequate). CA Remedies Essay Wrkshp 2016 Themis Bar Review, LLC 9
10 Tracing: A plaintiff can trace his prperty frm its riginal frm t its current frm. Fr example, a plaintiff can trace his mney t the purchase f a huse and recver the huse frm the defendant. Increase in Value: If plaintiff is granted a cnstructive trust, he acquires the defendant s prperty (nte: if the value f the prperty increased during the defendant s wnership, plaintiff gets the prperty and this increase). Defendant is nt liable t the plaintiff if the prperty decreased in value while wning it. 3. Equitable Lien (Equitable Remedy) An equitable lien is a judicially created remedy that impses a lien n the defendant s prperty. The plaintiff is nt seeking t take wnership f defendant s prperty, but rather claiming a creditr-like interest in the defendant s prperty. Example 7: Frm a past CA essay: Defendant embezzles mney frm Plaintiff and buys a huse with the mney. Plaintiff can trace his mney t its new frm (the huse) and btain an equitable lien against the huse. The huse wuld be sld and Plaintiff wuld receive his mney back (but he wuld nt be entitled t any increase in value). Requirements: Same as a Cnstructive Trust. Cmpared t a Cnstructive Trust Tracing: A plaintiff can trace his prperty frm its riginal frm t its current frm. Fr example, a plaintiff can trace his mney t the purchase f a huse. The huse wuld be sld and the plaintiff wuld recver the mney wed frm the sale prceeds. N Increase in Value: If plaintiff s mney is used t purchase prperty (a huse), plaintiff wuld nly be entitled t the amunt f mney that the defendant received frm plaintiff under an equitable lien thery (he wuld nt be entitled t any increase in value f the huse). Additinal Satisfactin: If a plaintiff has an equitable lien n defendant s huse that was purchased with plaintiff s mney, plaintiff wuld be able t frce a sale f the huse and receive the mney he was wed. If the sale price f the huse did nt cver the mney wed t plaintiff, he wuld be able t seek the additinal mney frm the defendant. Nte: Under a cnstructive trust thery, a plaintiff wuld take the huse itself frm the defendant as full satisfactin f his claim and he wuld nt be entitled t seek additinal mney frm the defendant. 4. Replevin (Legal Remedy) Replevin allws a plaintiff t recver his persnal prperty frm the defendant. The plaintiff regains pssessin f the prperty and can recver damages fr the lss f use f his prperty Themis Bar Review, LLC CA Remedies Essay Wrkshp
11 5. Equitable Defenses (Cnstructive Trust, Equitable Lien) Exam Tip 9: After discussing all relevant Equitable Remedies, yu shuld discuss the Equitable Defenses f Laches and Unclean Hands. Laches: If the plaintiff waited an unreasnably lng time t seek specific perfrmance and the delay prejudiced the defendant, the curt may deny equitable relief. Exam Tip 10: Read the facts carefully fr indicatins f Plaintiff delaying his lawsuit an unreasnable amunt f time. Unclean Hands: If the plaintiff himself engaged in unethical r immral acts relating t the cntract, the curt may deny equitable relief. Issue Checklists fr Trts and Cntracts (see Remedies utline fr mre details) A. Trts 1. Harm t Land (Trespass t Land; Injury t Land; Nuisance) Mney Damages Cmpensatry Cst t Repair r Lss in Value Nminal Cnsequential Punitives Injunctin Restitutin 2. Harm t Persnal Prperty (Trespass t Chattels, Cnversin) Mney Damages Cmpensatry Cst t Repair r Lss in Value Replevin Cnstructive Trust/Equitable Lien Restitutin Injunctin 3. Misapprpriatin f Mney (Cnversin) Mney Damages Cmpensatry Damages Punitives CA Remedies Essay Wrkshp 2016 Themis Bar Review, LLC 11
12 Restitutin Replevin Cnstructive Trust/Equitable Lien 4. Persnal Injury (Intentinal Trts, Negligence, Strict Liability) Mney Damages Cmpensatry Damages: Pain and Suffering, Medical Expenses, Lst Wages 5. Financial Harm (Intentinal Misrepresentatin; Negligent Misrepresentatin) Mney Damages Cmpensatry (Lss f Bargain r Out f Pcket) Cnsequential Damages Punitive Damages Refrmatin Rescissin Replevin Restitutin Cnstructive Trust/Equitable Lien B. Cntracts 1. Land Cntracts Mney Damages Cmpensatry: Difference between cntract price and market value f land Specific Perfrmance Rescissin Restitutin 2. Persnal Prperty (Gds) Mney Damages Cmpensatry Difference between cntract price and market value f gds Cst f Cver: Difference between cntract price and cst f substitute gds purchased by buyer (cst f cver) Lst Prfits Cnsequential Incidental Specific Perfrmance Themis Bar Review, LLC CA Remedies Essay Wrkshp
13 Replevin Restitutin 3. Building (Cnstructin) Cntracts Mney Damages Cmpensatry Lss f value r cst t cmplete/fix building defect Lss f prfit Rescissin Restitutin 4. Emplyment Cntracts Mney Damages Cmpensatry: Salary r wages under the cntract Cnsequential Incidental Limitatins: Avidable Cnsequences (Duty t Mitigate) Rescissin Restitutin Injunctive Relief t enfrce a Cvenant nt t Cmpete 5. Mistake/Misrepresentatin Refrmatin Restitutin [END OF HANDOUT] CA Remedies Essay Wrkshp 2016 Themis Bar Review, LLC 13
14 Themis Bar Review, LLC CA Remedies Essay Wrkshp
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