Schwartz-2011-fall-remedies-answer

Schwartz-2011-fall-remedies-answer - Exam Number REMEDIES...

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Unformatted text preview: Exam Number: REMEDIES FINAL EXAM - GOLDEN GATE LAW SCHOOL - FALL 2011 Points Points _ 1. If Sally filed a timely action against Elite Academy in tort, what remedies were available to her? What defenses could she antici - ate? Underlying harm: Sally is suing for gross negligence for using defective equipment. substandard academic supervision & training of an agent. and failure to provide adequate safety attire. Gross negligence carries punitive damages. (She could also have filed claims for ordinary negligence and battery.) Compensatog damages could be divided into ordinary and special; direct and indirect; economic and non- economic. immediate and consequential - up to the student to choose structure. Subject to any limitations imposed by statutog tort reform. Sally can claim medical expenses: emotional distress; cosmetic surgery: pain 8. suffering: lost time in school; and lost or (more likely) delayed opportunity to enter Harvard. As for special damages not generally associated with such tortious conduct, even if Sally was able to defer admission to Harvard for a year. she might lose her $40K scholarship. especially if it was related to swimming and she is permanently unable to compete. See restitution. below. re insurance. Punitive (aka exemplag) damages based on malice. oppression. or fraud. Malice might work here. Measured as treble damages or greater. No indication that school is a corporation, so this was tricky. Defenses to damages: The school will argue assumption of the risk. contributory negligence. and malfeasance by ToolCo. School may also argue that actual notice of special circumstances (Harvard scholarship) is required in order for liability to attach. Sally must mitigate by applying for deferral of admission to Harvard. Restitution of the balance of the tuition. If Sally’s parents were insured. the collateral source insurer would demand subrpgation for its payments. Coercive relief. I expected your analysis to acknowledge that no form of injunctive relief was a perfect fit. it is a little late for a m unless the school continues the same practices in welding class. A preliminag injunction would be possible since litigation is in progress. Sally might want to request a permanent injunction (IPFBD) even though the school has likely engaged in voluntary cessation. Elegion of remedies. Sally should choose compensatory and punitive damages. Depending on the school’s response to the accident. she may also want to pursue coercive relief to avoid injuries in the future. ——— 2. If Sally’s parents filed a timely action against Elite Academy for return of their tuition a ment, what remedies were available to them? What defenses could the antici - ate? gpdegyjng harm: Sally's parents are suing for breach of contract (express or implied in fact) and appear to be demanding rescission accompanied by restitution of their tuition payment in full. This remedy will not be granted in full because they have already received and accepted the benefit of six months of education for their daughter. However. the remaining months may allow a partial refund under a modification. Defenses to all theories of remediation: Elite Academy will argue that waiver of tuition refund and/or liguidated damages serve as a complete bar to recovery. Damages. Expectation damages. Sally's parents expected a safe and effective educational environment for Sally for one academic year. The blow torch injury constituted a breach of that expectation. They n claim damages for the difference between what they were promised and what they received. The school has a good argument that they received the services they expected from September through the date of the accident in March. Although the school will emphasize the express waiver provision (which some students characterized as liguidated damages) in the contract (no refund). a court is unlikely to enforce it under public policy. No punitive damages or damages for emotional distress are available in contract. We; The parents can claim reasonable and foreseeable damages or losses resulting from the injury. including medical and health costs and therapy for Sally. increased educational costs. the loss of the scholarship and other expenses related to Sally's education. Continued on reverse . . . 14 Question 2 continued Restitution. The parents can claim restitution of the remaining months of tuition. but are not likely to succeed in demanding rescission and full restitution of tuition. If the school has no disposable income to satisfy a judgment or award. the Sharps will have to Iii the school’s real property. making them secured creditors. They would be wise to obtain a judgment lien in this case. They would not be able to impose a constructive trust on the building. which the school purdtased with its own funds. and it is not likely they could impose a constmctive trust on the roof either. because their money was merely applied to it. Coercive relief. Specific performance does not apply. but the Sharps could ask for a modifition (6 months of education instead of 9. with proportionate restitution of percentage of payment for remaining months). Rescission does not apply because a partial exchange has occurred. Election of remedies: Sally's parents should sue for a breach of the enrollment contract and a refund of the portion of their payment that is attributed to the remaining months of enrollment. They are not likely to be barred by the doctrine of waiver but will not receive a full refund because the school has performed its obligations for the time prior to the accident. Dogble recovery: Although we have Sally as the plaintiff in the first interrogatory and her parents as the plaintiffs in the second interrogatory. there is still a risk of double recovery. The court would have to be sure that medical expenses. Elite Academy tuition. and Harvard costs are awarded to the proper plaintiff and are not dulicated. 3. Assume for purposes of this question only, that Sally has just seen the recent government report about the new findings regarding defects In the ToolCo blow torches; It was posted two days earlier on the lntemet. Can she sue ToolCo? What remedies are available and what defenses can she anticl - ate? This question implicates the discovery rule and punitive damages against corporations. Although it was fine to re-discuss compensatom damages and iniungtive relief (T R0. temporary injunction during litigation. permanent injunction as a final remedy — all of which may be in place from the gov't investigation). the hot issues were the statute of limitations (discovery rule) and punitive damages. Undeflying harm: Product liability (defect in design. manufacture. and/or labeling). Discoveg rule. Although the statute of limitations for a tort action generally begins to run from the time of the event. accrual n be delayed until P discovers or reasonably could have discovered (with due diligence) both her injury and the fact that the D is a cause of the injury. Here. it can be argued that Sally should immediately have surmised that the blow torch was defective. so the suit against ToolCo is barred by the SOL. However. the plaintiff will argue that the problems were only discovered in 2011. when sta_t£: officials investigated ToolCo and learned about the defective design and labeling. Causation is not an issue' no other forces caused the in u . The court will likel allow the suit to roceed. Eunijive damages. To gual'fl for punitive damages, P must show that D corporation acted with conscious disregard despite being aware of probable dangerous consequences to the public. In measuring punitive damages 8. to avoid excessive punitive damages in violation of Filth or Fourteenth Amendment. court considers: (1) degree of reprehensibility (cannot be established by extra-jurisdictional evidence): (2) ratio between compensatory and punitive damages: and (3) difference between punitive damages and civil or criminal sanctions available. Punitives should adhere to a 1:9 ratio to compensatory damages (State Farm). If actual damages are large enough. court should use a 1:1 ratio between compensatory and punitive damages (Exxon). Punitives should not be based on harm to persons who are not litigants in a suit (Phillip Morris). Here. ToolCo knew from its tests that one out of every ten of the tools tended to ignite and flare if not handled properly. It will argue that this meant harm was possible but not probable. and is even less if handled property. They reduced this by labeling. The Sharps will argue that by the time a blow torch is used ten times. harm is probable. and the poor labeling was an insufficient precaution. If the family qualifies for punitive damages. it will be limited to a ratio of 1:9 to actual recovery. Election of Remedies: If the Sharp Ps have recovered from Elite Academy already. ToolCo will argue this is redundant recovery and. furthermore. the suit is barred by res judicata (sorry abOut that, folks!). However. a court might allow the suit to proceed and order ToolCo to indemnify Elite Academy to the de ree that ToolCo is liable. ID: Remedies_LSN_Schwart z_Final_20 llFL Schwartz ID: (Exam Number) Exam Name: Remedies_LSN__Schwarlz_Final_201 1 FL Instructor: Schwartz Grade: Page 1 of1 Exam taken with SofT est v2445 ID: Remedies_LSN_Schwart z_Fina1_20llFL Schwartz 1) ======== Start of Answer #1 (2273 words) ======== 1. Sally v. Elite Academy. Cause of Action: Tort (Gross Negligence} Sally has filed suit alleging that the school was liable for gross negligence in falling to train and supervise its teachers. who in this case, were entrusted with dangerous equipment, failed to provide the welding students with protective clothing, and "tossed" a blow torch at an inexperienced welding student. Remedies: A. Damages: 1. Compensatory damages. Sam montetarily for her injuries. Personal injury damages consist of medical costs, (hospital bills, ongoing therapy, equipment used in hospital/therapy, medicine, etc. which relate directly to the injury, and future medical costs of this same MW (loss of wages due to time away from work because of injury, loss of future earning potential, etc.). and finally pain and‘suffering (actual physical pain related to injury. difficult to quanitfy, can look at factors such as what amount a person would be willing to be given in exchange for going through this pain voluntarily, take taken from productivity, etc.). and the degree of suffering the person is experiencing as a result of enduring this pain (also difficult to quantify, can look at psychological issues such as depression but must be in relation to the injury, and a conscious awareness of suffering, time taken away, etc. and use a per diem basis to calculate). Here S has $350k worth of medical costs. and these can easily be Page 1 of 9 (Question 1conlinued) ID: Remedies_LSN_Schwart z_Final_2 0 1 1FL Schwartz 2 calculated/substantiated. Her pain and sufferin is also great, as she was disfigured, and she has extensive physical and emotional therapy, now and in the foreseeable future, as well as cosmetic surgery to deal with as a result. She can't remain on the swimteam or even finis the school year or graduate with her class. Since she is also unable to attend Harvardfi‘hg‘rgimie earning capacity is further diminished, as we don't know if she will ever be able to attend college due to her injuries. She will easily recover compensatory damages based on her injuries. loss of time (if she is working). loss of earning potential, and pain and suffering. She would also have separate claim for loss of enjoyment/other emotional distress issues if she so chose. Defense: Academy might claim contributory negligence in 8 not wearing her own a protective clothing or assumption of risk by taking a class in welding with inherently dangerous materials. but these will fail because this is a school and the school has the duty to reasonably train/supervise teachers in order to protect students especially in classes like this. Even though 8 is 18 and an adult, taking a class in welding is not a voluntary assumption of a known risk of this extreme proportion. Further, S didn't do anything wrong/to cause the injury, she stood there and had a blow torch tossed at her by a teacher. This defense will apply to all of the negligence claims. Elite might also claim Collateral Source Rule if S's insurance or another form of assistance is covering her medical costs. This will generally apply onto to private sources, like insurance, etc.. However, if it were, the insurance company likely has a subgrogation clause that would require pay back so to prevent any double recovery anyway. If a public source is aiding, which (D) contributes to, this wouldn't apply since Page 2 of 9 (Question 1 continued) ID ’ Remedies_LSN_Schwartz_Fina1_2011FL Schwartz (D) participates. 2. Consequential damages: damages that are the result of a consequence reasonable and foreseeable to parties and naturally flowing from the conduct (Buck). / As a consequence of the negligence/injuries. S is unable to complete the school year and is also forced to give up her admittance into Harvard for the following school year. which means she has lost her full year scholarship of $_40k. But for the negligence. she would be going about her way. finishing her school year. receiving a diploma. and going on to Harvard, and it is reasonable and foreseeable that negligence of this magnitude in dealing with dangerous equipment such as a blow torch could cause serious injury and possibly death to students. It would be better for her to recover her tuition for the year by way of restitution. and her parents will do so in their suit. Regarding her Harvard tuition. this is $40k that will be lost due to her injury and inability to attend as a consequence. This is a consequential damage. Defense: Elite will argue that special circumstances require sgecial notice in terms of consequential damages. but this usually applied to Ks. In acting this negligently, one must foreesee that it could cause serious injury or death, and thus this will be included in consequential damages. 3. Punitives: available with intentional tort including malicious intent. or gross fl negligence. Here punitives will be available because of the extreme negligence in failing to train/supervise teachers to handle dangerous equipment in a safe manner around Page 3 of 9 (Question 1 continued) ID: Remedies_LSN_Schwartz_Final_2 OllFL Schwartz students in a school. Though the school is not a corporation, and is a private entity, punitives are available where there is gross negligence, which is the case here in failing to require protective clothing and failing to train/supervise teachers to handle with care. Defense: Elite may also argue that it was the contributory negligence of the actual teacher that caused the injuries, in actually "tossing" the blow torch, and thus they are only partially responsible for his negligent act as his employer, not grossly negligent to necessitate punitives. This may lower their liability as the teacher is also responsible, but as the employer, the school was also negligent, arguably grossly negligent. and so punitives may still apply. B. Coercive Relief: “0 1. Structural injun on - man atory modification of instituion policy pennant . . . . Sally can file for aNnjunctIon mandating that the school reform their pOIICleS as to safety. This may be difficult because it happened only once as far as we know, but there is the potential for it to happen again given that this is an offered class at the school, and there is a high possibility of future harm. Injunctions are generally favored when there is no sufficient legal remedy, though that may not the case here. 2. Parents v. Elite Academy. Cause of Action: breach of K A. Damages 1. Reliance/Expectation. Parents may argue that based on their expectation and "a, reliance on the performance of the K (provide safe school for daughter in exchange for Page 4 of 9 (Question 1 continued) ID: Remedies_LSN_S chwart z_Fina1_2 0 1 lFL Schwartz 2 tuition). they paid the amount. and the result was to their detriment because Elite breached this duty when the injury occurred. They may be able to recover the money spent in expectation of the full school year as well (only if valid K with definite, certain terms). or at at least their reliance on that promise. Parents will argue for restitution based on the principle that there has been a breach of the K for S t attend the school in exchange for the year's tuition. 2. Elite also had a duty to mitigate (if Parents are determiend to be breaching party, by removing S from the school), may have been able to recover costs and then parents would only owe the difference. A. Restitution - this will be parent's best bet at recovery 1. Parents would like mututal rescission/restitution for benefit conferred on the school in the form of tuition that won't go towards education their daughter. They paid the tuition in exchange for a year of school. and due to the school's conduct (parents forced to remove child from school). Elite has been unjustly enriched by the tuition. 0 Since 8 attended the school until March. they should be liable for the months that S W was in attendance. but following the accident. rescission. “M 2. Parents may be entitled to the amount of their tuition that was used to put in the new roof at the school. by way of conversion. The problem here though is accounting/porportionality must be considered in determining what amount of money was used to produce the end result. 3. Other forms of restitution/enforcement of J: Parents may be entitled to a constructive trust of the school property in order to eventually be repaid for the tuition unjustly conferred on Elite, or a judgment lien in order to be first in line to be paid if the school were to sell the property. since they have no cash following the roof project. Page 5 of 9 (Question 1 continued) ID : Remedies_LSN_S chwartz_Final_2 O 1 1 FL Schwart 2 Here there would nee dto be accounting/proportionment if they co-mingled the funds with their own and used the total for the roof - to determine what amount originally acquired from the parents was put into the roof. They wouldn't be entitled to a trust for the entire property, since likely only a portion of their funds went to it. B. Coercive relief 1. Parents may be able to seek modification of the K to provide for the fact that W their daughter is no long able to attend the school, due to the consequences of Elite's failure to perform per K Defenses: Elite will argue that these consequences were not reasonably foreseeable at the time of K formation, at that there is no provision in the K for removing the child from the school. However, the court may find this inconscionable/unbalanced K. The fact that the entire amount of tuition is held upon removal may be viewed as over liquidated “film damages. since it does not relate to actual damages and instead acts as a penalty for #— parents who must remove their students, which a court will not enforce. 3. Sally v. ToolCo blow torches, Cause of Action Negligence/Products Liability A. Damages 1. Compensatory for injuries. see above. Re. products liability, one must have actual injury to recover. Here that is easily satisfied. 2. Consequential for tution, see above. Reasonably foreseeable/naturally flowing from conduct? Negligence this severe re. a dangerous product means possible of serious injury and consequences resulting should be foreseeable. They also naturally flow from the product since but for the injury caused by the torch Page 8 of 9 (Question 1 continued) ID: Remedies_LSN_Schwartz_Fina1_2 011FL Schwartz igniting/flaring and catching fire, S would have been able to finish school and begin / college. 3. Punitives (punitives are available against a corporation in certain circumstances. They are available if there is a consciou disre ard for human safety, despite notice of probabl...
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