LEB EXAM 3 10/26 LECTURE 1 I. VAGUE CONTRACTS A. “Against the author” Rule- contracts have a clear author that is on one side and the other side just signs 1. If there is a legitimately vague part of the contract the interpretation most favorable to you would win and the author would lose B. Handwritten>types>fineprint 1. If handwritten part of contract contradicts the typed, the written response wins if not signed yet 2. Get a handwritten copy before sign the contract to have proof of change 3. The larger the font, the better 30pt>18pt II. SUBSTITUTIONS A. Legally making a switch, subleasing B. novaction, the person on the other side of the deal “landlord” accepts the new leser as full part of contract and old lease is completely out of picture and not liable III. BANKRUPTCY A. Congress called upon to regulate bankruptcy 1. Loss as bad debt and erased 2. Allows people to spend money and walk away from debt- people used to be embarrassed about filing bankruptcy and used to stay on credit- people don't care anymore B. Chapter 7 C. Liquidation bankruptcy- all you assets that are not exempt is liquidated and used to pay off debt and rest of the debt is erased D. No obligation to pay off debt once erased E. Do you get to keep your house? 1. Texas has strong property laws so yes, as long as it is primary residence F. Before 2005, people who had a lot of debt could move to Texas, buy a house, and declare bankruptcy, keep the house. G. New Rules: 1. If you live in house <40 months, you can keep the house if worth $146,000 or less 2. you will lose your house if more than $146,000 and less than 40 months 3. If you lived in house more than 40 months, up to state law H. Never erasable debt: 1. Intentional torts or crimes (criminal case charges) 2. Family support obligations 3. Taxes 4. Student Loans
I. CH 11/13 J. A person or company in financial trouble submits a financial plan because… 1. can pay back money but needs extra time 2. can pay but needs to decrease interest rate K. If plan is approved, legally replaces initial L. Creditors get to vote if plan is approved 1. People who are owed ⅔ total debt are more powerful in voting 2. has to be at least ⅔ of debt owed and then counts 3. Ex: 40 M- Yes 40 M- Yes 10 M- No 10 M- No ------------------ $80/100 < Yes so counts as Yes M. CH13 N. The bankruptcy judge decides in good faith evaluating current salaries and assets< only people can file, not organizations O. Can file bankruptcy every 6 years IV. CONSUMER PROTECTION A. Postal Recognition Act of 1970 1. If you receive things in the mail you didn't request, legally treated as a gift/legally belongs to you B. Collection Agency 1. Send people, postcards- bug people till they pay 2. If you retain a lawyer to help, the CA has no legal rights to bother you,have to work with lawyer C. Law that caps usage of credit card $50 limit total of unauthorized use unless 1. Fail to promptly notify CC company when you notice strange charges 2. Voluntarily give card and they buy more than expected 10/28 LECTURE 2 I. INTESTACY LAWS A. “Back up plan” B. Kicks in if someone dies without a plan or will C.
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