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134 Cards in this Set
- Front
- Back
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Creation of Agency Relationship
Capacity Formation Rights of P |
Capacity - Principal must, Agent minimal
Agent disqualified if: - represents both parties - self-dealing - not licensed, if required by law Formalities - consent by P and A - no consideration necessary - no writing required to prove relationship Rights - loyalty - obedience - care - notification |
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Termination of Actual Authority
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1. lapse of time
2. happening of specified event 3. change of circumstances 4. breach of agent's fiduciary duty 5. unilateral act of P or A 6. operation of law |
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Apparent Authority?
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Is there a reasonable belief by a third party that A possesses authority to act on behalf of P?
Principal 'holds out' A as possessing certain authority |
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Ratification
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P must:
1. know material facts of transaction 2. accept ENTIRE transaction 3. have capacity to act NO consideration requirement P may NOT ratify IF: 1. performance would be illegal at time of ratification 2. after 3rd party withdraws 3. material change in circumstances |
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Principal liability for contracts made by agent
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P liable if A has any type of authority
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Agent liability on contracts entered into for P
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1. P undisclosed or partially disclosed (3rd party doesn't know about agency or doesn't know who P is)
2. A agreed to be liable 3. A acted without authority (A liable in warranty) |
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Third party liability
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Only P can hold 3rd party liable, NOT A
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Respondeat Superior
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For P to be liable for A's torts:
1. employer-employee relationship -assent, benefit, control 2. employee's wrongful conduct within scope of employment = P has right to control manner of work, detour inside, frolic outside P NOT liable for torts of independent contractor EXCEPT ultra-hazardous, estoppel for 'holding out' |
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Valid offer
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1. manifestation of a present intent to contract demonstrated by a promise, undertaking, or commitment
2. communicated to an identified offeree 3. definite and certain terms |
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Termination of Offer
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1. lapse of time
2. revocation - words or conduct of the offeror terminating the offer - effective when received by offeree 3. rejection - words or conduct of the offeree rejecting the offer - effective when received 4. operation of law - destruction of subject matter, supervening illegality, death or insanity of either party |
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Irrevocable Offers
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1. merchant's firm offer under UCC
2. option contract 3. detrimental reliance |
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Acceptance of contract
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common law = mirror of offer
UCC = added terms part of contracts UNLESS: 1. materially alter the contract 2. offeror objects 3. offer limited to its terms Method of acceptance 1. promise to perform 2. start to perform 3. complete performance Any reasonable mode Mailbox rule |
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Mailbox Rule
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Acceptance effective on dispatch UNLESS:
1. offer stipulates acceptance not effective until received 2. option contract - effective upon receipt 3. if rejection then acceptance sent, first to arrive is effective 4. if acceptance then rejection sent, acceptance effective unless rejection arrives first and offeror detrimentally relies |
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Consideration
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1. bargained for exchange
2. legal detriment or benefit (VA test, majority = detriment only) 3. promissory estoppel (detrimental reliance) may sub for consideration - promisor should reasonably expect her promise to induce action or forebearance - of definite and substantial character - action in fact induced Rules 1. adequacy irrelevant 2. past consideration = None (VA rejects majority exception that past consideration ok if promisee performed at request of promisor) 3. pre-existing duty = none UNLESS - part payment to settle existing debt if something new or different given - payment to settle legal claim if there is real dispute - payment of debt barred by statute of limitations |
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Defenses to Formation
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1. Statute of Frauds
2. incapacity 3. illegality 4. fraud 5. duress 6. unconscionability (applies only to formation in VA) 7. mistake - unilateral, mutual, ambiguous terms |
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Statute of Frauds
(MY LEGS) |
1. marriage
2. one year rule 3. land 4. executors and administrators 5. goods of $500 or more 6. suretyship VA UCC - writing must only provide basis for believing that offered evidence rests on real transaction |
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Terms of Contract
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Interpretation
- custom and usage - course of dealing Parol Evidence Rule Modification - need additional consideration - UCC = no consideration if in good faith - satisfy statute of frauds |
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Third Party Beneficiaries
-formation of contract -have rights vested? -who can sue? |
3rd Party beneficiary contracts
- express undertaking by the promisor to benefit 3rd party - intent of promisor to benefit 3rd party Have rights vested? - manifests assent - brings suit to enforce - materially changes position in justifiable reliance Who can sue? - 3rd party beneficiary v. promisor - 3rd party beneficiary v. promisee - promisee v. promisor |
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Assignment of Rights
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1. Valid unless materially alter obligor's duty or risk or unless prohibited by law
2. does obligor have defenses against assignee? 3. more than one assignment of the same right |
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Delegation
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OK unless:
1. prohibited by contract 2. personal judgment or skill 3. changes obligee's obligation Obligee may sue delegator or delegate, if consideration given |
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Contract Conditions
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promise v. condition = intent of the parties
Precedent, Concurrent, Subsequent Express, Implied, Constructive |
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Excusing Contract Conditions
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1. failure to cooperate
2. actual breach by other party 3. anticipatory repudiation 4. prospective inability or unwillingness to perform 5. substantial performance (constructive condition, breach minor and not willful) 6. divisibility of contract 7. impossibility, impracticability, frustration 8. waiver or estoppel - estoppel waiver - election waiver - condition waivable IF ancillary or collateral or no consideration |
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Discharge of Duty to Perform
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1. modification
2. recission 3. accord and satisfaction 4. novation 5. impossibility (death, physical incapacity, illegality, destruction of subject matter) 6. impracticability (extreme and unreasonable unanticipated difficulty) 7. frustration of purpose 8. condition subsequent 6. |
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Common Law Remedies for Breach
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1. Duty to Mitigate
2. Damages - compensatory - expectation and foreseeable consequential - liquidated - actual damages difficult to calculate, amt = reasonable forecast, no punitive 3. specific performance 4. quasi-contract |
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UCC Remedies for Breach
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Seller
1. commercially reasonable sale 2. market price 3. profit 4. action for price Buyer 1. cover 2. market price 3. specific performance 4. breach of warranty VA - buyer not required to notify seller of all objections, but must notify seller that it is troublesome No punitive damages for contractual breach of warranty VA implied warranty of merchantability arises in the sale of used product Prima facie case of breach of implied warranty in VA 1. existence of warranty 2. warranty breached 3. breach proximate cause of loss Lack of privity not a defense to breach of warranty for physical injury (still counts for economic loss) as long as reasonable to expect P would get goods |
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Law on the Organization of Corporations
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Virginia Stock Corporation Act
Articles of Incorporation (A PAIN) 1. # of authorized shares 2. preferences among classes of stock 3. agent - required in VA 4. incorporators' names and addresses 5. name of corp with indicia of corp status Bylaws Piercing Corp Veil -avoid fraud or unfairness -alter ego - not sufficient corp formalities -undercapitalization |
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Promoters
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1. Fiduciary duty to subscribers of stock, corporation, and shareholders
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De Jure Corporation
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1. File with SCC and recorded with city or county clerk
2. Articles MUST state: - name of corp - capital stock structure - registered agent and office 3. Bylaws NO de facto or estoppel corporations |
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Shareholder Rights
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No liability EXCEPT:
- fraud - shareholder as fiduciary - piercing corp veil - fraud, initial undercapitalization, alter ego Elect board of directors Convene meetings to vote on charter or amending bylaws or other changes |
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Shareholder Voting
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Only shares of record
Mechanics 1. Cumulative 2. Quorum 3. Meeting - Annual - Special - Notice (to secretary, 10-60 days before meeting, in writing stating time and place) 4. Proxies - written, signed - expires no more than 11 months -directed to secretary of corp - revocable unless labeled AND proxyholder has interest beyond proxy 5. Effective shareholder action - quorum, majority of votes cast, cumulative voting for directors 6. Voting Trusts - any nonfraud purpose, 10 max renewable - legal ownership to trustee, shareholder retains beneficial ownership 7. Voting agreements - any nonfraud purpose - can be perpetual - shareholders retain legal and beneficial ownership 8. Shareholder agreement - corp with fewer than 300 shareholders - 10 years unless agreement says otherwise - shareholders retain both legal and beneficial ownership - agreement binding on subsequent purchasers |
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Board of Directors and Officers
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1. Duty of Care
2. Duty of Loyalty - can be circumvented if material facts disclosed to board and shareholders and ratified by majority of board members and transaction fair 3. Liability - joint and severally liable for breach - votes for or assents - 2 year statute of limitations - indemnification if quorum present and approved by disinterested directors or shareholders 4. indemnification -prohibited if director held liable to own corp -mandatory when director wins suit against any party -permissive for liability to 3rd parties and settlement with own corp - must show good faith with reasonable belief that conduct was in corp's best interest -majority of independent directors, committee of at least 2, majority of shares held by independent shareholders, special legal counsel's opinion |
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Capital Stock Structure
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1. Resolution - authorizes issuance, sets minimum consideration, fairly describes consideration if other than money
2. Subscription agreements 3. Consideration for stock 4. Preemptive rights - none unless provided in corporate charter (presumed for corps before 2006) 5. Dividends - no right to them (but bad faith can be violation) - irrevocable once declared (insolvency exception) - payable out of surplus, NEVER capital 6. Redemptions and repurchases of stock |
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Fundamental Corporate Changes
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Requirements
1. Board resolution 2. Notice to stockholders 25-60 days prior 3. Stockholder approval by 2/3 of all votes cast 4. Articles of amendment filed with SCC Exceptions: 1. Parent-subsidiary merger or'short form' 2. Surviving corporation in a merger 3. Share exchange - for corp acquiring stock 4.Asset transfer - for corp acquiring assets 5. Court-ordered changes Amendment of Charter 1. No stock outstanding - all original incorporators file articles of amendment OR majority of entire board approves filing of articles of amendment 2. outstanding stock = same requirements for mergers |
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Dissolution and Liquidation
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- 2/3 shareholders must approve
- Pay outside creditors first |
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VA Limited Liability Company
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Characteristics
- limited life - ownership not freely transferable - members manage the company - limited liability Dissolution - time or event stated in the operating agreement OR - unanimous vote of members OR - no members are alive OR - judicial dissolution on application by one member |
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Accomplice Liability
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-Active aiding, abetting, counseling
-Mere presence not enough -Liability for crime itself and all other foreseeable crimes Parties - principal in 1st, 2nd degree - accessory before, after the fact Defenses 1. withdrawal - affirmative defense - voluntarily renounced - withdraw prior - made substantial effort to prevent 2. Accessory after the fact NOT liable for crime itself, separate lesser charge |
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Solicitation
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Ask someone to commit a crime
Refusal or legal incapacity of the solicitee NOT a defense |
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Conspiracy
-elements -liability -defenses |
Elements
1. agreement 2. intent to agree 3. to achieve the unlawful purpose or objectove of agreement 4. overt act NOT necessary Liability -Each conspirator is liable for all foreseeable crimes of other conspirators and in furtherance of the conspiracy -In VA, D may be convicted of both completed offense and conspiracy Defenses 1. NO impossibility 2. can only withdraw from liability for future crimes 3. No merger |
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Attempt
-elements -defenses |
Elements
1. specific intent 2. substantial step in the direction of the commission of the crime (mere preparation not enough) Defenses 1. Factual impossibility NOT a defense 2. True legal impossibility IS a defense 3. Abandonment is NO defense |
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Self-Defense
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1. Non-deadly force OK - NO duty to retreat
2. Deadly force - Never for defense of personal property - MUST be without fault, confronted by unlawful force, threatened with imminent death or great bodily harm 3. Police MUST reasonably believe suspect armed or presents danger to public to use deadly force 4. If no self-defense then crime is voluntary manslaughter |
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Murder
-elements -defenses |
-Common law murder in VA = 2nd degree
-Felony murder is 1st degree in VA - liable for all deaths caused by felons Element = Malice = intent to kill, do serious bodily harm, depraved heart Defenses -Justification = self-defense -Provocation = reduces to voluntary manslaughter -Felony murder - D has defense to underlying felony, killing foreseeable, death caused afetr reaching point of 'temporary safety', D not liable death of co-D as a result of resistance by V or police |
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Manslaughter
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Voluntary
-adequate provocation -actually gave rise to heat of passion - no adequate cooling-off period - failed self-defense claim Involuntary -killing from criminal negligence -misdemeanor manslaughter Defense = lack of causation |
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Criminal Law Defenses
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1. Insanity
2. Intoxication 3. Infancy 4. Self-defense 5. Duress and necessity 6. Mistake of fact 7. Consent 8. Entrapment |
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Search and Seizure
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4th A right
- government conduct - reasonable expectation of privacy - standing Did police have search warrant? - probable cause = fact specific, flexible, objective standard of the reasonable law enforcement officer, practical non-technical probability that evidence will be found - neutral and detached magistrate - properly executed - probable cause derived from informant = affidavit required to meet 'totality of the circumstances' test Exceptions 1. search incident to constitutional arrest, person and wing span 2. automobile -reasonable suspicion of criminal activity -probable cause to search car -scope = whole car including containers that could contain item 3. plain view -legitimately on the premises -criminal stuff in plain view 4. consent -voluntary and intelligent -3rd party consent valid if reasonable -invalid if suspect is present and objects 5. stop and frisk -reasonable suspicion that criminal activity afoot -frisk if police reasonably believe D is armed 6. hot pursuit |
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Confessions
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DP says confession must be voluntary
Miranda - 5th A 1. Custody - VA uses objective test 2. Interrogation 3. Waiver - voluntary, intelligent, NOT silence Limits 1. Waiver 2. Spontaneous statement 3. Not custodial -traffic stops -probation interviews 4. Impeachment of D's testimony if he takes the stand |
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Line-ups
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6th A right to counsel for post-charge line-up (not photos)
DP problem if unecessarily suggestive or substantial likelihood of misidentification Exclusion limited by independent source for in-court ID, witness observation at crime or prior ID |
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Jury Trial
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6th and 14th A
1. serious offense 2. 6 month rule - overcome by showing additional penalties 3. cross-section rule for jury selection 4. right to impartial jury VA Privileges -Physician-patient NOT at criminal, only civil -husband-wife - living apart not material |
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Guilty Plea
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Judge must address D on the record to show D informed of:
1. nature of charge 2. max sentence authorized 3. right to plead not guilty 4. pleading guilty waives right to trial Attacking plea after sentence 1. plea involuntary - errors in proceeding 2. court lacked jurisdiction 3. ineffective assistance of counsel 4. failure of prosecutor to keep plea bargain Finality of plea 1. D not permitted to withdraw plea if intelligent choice from among alternatives 2. plea arrangement may be changed before D enters plea |
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Exclusionary Rule Exceptions
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1. Grand juries
2. civil cases 3. search does not violate fed Constitution of statute 4. violation of knock and announcement 5. violation of fed or state regulation 6. violation of agency guidelines 7. good faith reliance on -case law -statute or ordinance later declared unconstitutional -defective search warrant -exceptions = affidavit lacking probable cause, warrant defective on its face, affiant lied or misled magistrate, magistrate abandoned judicial role |
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Fruit of Poisonous Tree
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Excludes all evidence derived from illegal police act
Limits = inevitable discovery, independent act of D that breaks chain |
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Relevance
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Evidence is relevant if it tends to prove or disprove a fact of consequence admissible
Social policy exclusions -liability insurance -subsequent remedial contact -settlement -payment or offers to pay medical -guilty pleas Prejudicial impact must substantially outweigh probative value to exclude -inflammatory -confusion of issues -misleading the jury -undue consumption of time |
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Impeachment Techniques
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1. prior inconsistent statement
2. bias 3. prior conviction of crime 4. bad acts 5. bad reputation for truth |
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Substantive character evidence
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Criminal
1. Prosecution can to prove non-character elements (motive, intent, absence of mistake, identity, common scheme or plan) 2. Defense - anytime Civil 1. habit 2. character in issue by virtue of case |
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Opinion
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Lay opinion must fall within those areas of common perception
Expert opinion 1. expert testimony would help trier of fact 2. based on matters on which expert would rely 3. expert qualified |
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Exceptions to Hearsay
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Documents
1. past recollection recorded 2. business records 3. official records 4. ancient docs (VA deed must be more than 30 years old, other docs more than 20 and found in an expected place) 5. learned treatises VA adds school records, sworn affidavit of vehicle repairman if under $1000 or with consent of opposing party Or true copy mailed to adverse party at least 7 days before trial Declarant Available 1. excited utterance 2. present sense impression 3. bodily conditions Declarant MUST be unavailable 1. declaration against interest 2. dying declaration 3. former testimony VA polygraphs inadmissible VA recordings of phone conversation only admissible in a civil proceeding if all parties knew it was being recorded AND contains admissions that would constitute criminal conduct that is the basis of the civil action |
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Counties
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unincorporated districts immune from tort claims
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Municipal corporations
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1. Cities - incorporated, independent from counties within defined boundaries, population of 5,000 or more
2. Towns - incorporated community not independent from counties within defined boundaries, population of 1000 or more 3. Service authorities and other quasi-municipal corporations Sovereign Immunity only as to 'public' functions |
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Creation of Cities and Towns
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Legislative function of the state limited only by the state constitution
1. General laws - apply to all cities and towns 2. Special Acts - only apply to particular locality and require 2/3 vote in each house 3. Through courts - town or community petitions |
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Alteration of Cities and Towns
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annexation = state legislation subject to judicial review
corporate contraction = city or town passes ordinance and petitions circuit court Dissolution = general act of general assembly |
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Limitations of Power of localities
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Dillon's Rule - locality can onyl exercise powers granted expressly by statute or charter unless necessarily implied in or incident to the powers expressly granted
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Present Possessory Estates
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1. Fee simple absolute
2. Fee Tail (abolished in VA) 3. Life Estate (double damages for wanton waste in VA) Defeasible Fees 4. Fee simple determinable = automatically terminates on the happening of stated event and reverts to grantor (Reverter) 5. fee simple subject to condition subsequent - grantor retains power to terminate estate of grantee upon happening of stated event (right of reentry) 6. Fee simple subject to executory interest - automatically terminates on the happening of stated event and goes to 3rd party |
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Reversionary Interests
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Vested and not subject to Rule Against Perpetuities
1. Possibility of reverter - fee simple determinable - grantor 2. Right of entry or power of termination - subject to condition subsequent - transferor 3. Reversion - residue of incompletely transferred estate by operation of law - grantor VA 10 year statute of limitations to regain title after breach |
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Remainders
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Interest of transferee capable of taking upon natural termination of life estates
1. Indefeasibly vested remainder - held by ascertained person, certain to become possessory, not subject to being divested, not diminishable in size 2. Vested remainder subject to open 3. Vested remainder subject to total divestment - subject to defeat by happening of some condition subsequent 4. Contingent remainder - either subject to condition precedent or created in favor of unascertained persons (VA = no destructability of contingent remainders, remain executory interest until contingency occurs) No Shelley's Case rule - O to A for life with remainder to A's heirs is given effect as written No doctrine of worthier title - rule against remainders in grantor's heirs All future interests can be transferred inter vivos or by will |
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Executory Interests
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Any future interest in transferee that is not a remainder
1. Shifting executory interest - divests a transferee 2. Springing executory interest - follows gap in possession or divests transferor |
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Joint Tenancy
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Co-tenants with right of survivorship
Four unities = time, title, interest, possession Severance by suit for partition or inter vivos conveyance by one joint tenant VA = right of survivorship must be expressly reserved |
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Tenancy by the entirety - marital estate
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Severance = voluntary partition, conveyance by both parties, divorce
VA still recognizes |
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Tenancy in common
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concurrent estate with no right of survivorship, only unity of possession
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Types of Tenancy
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1. Tenancy for years - fixed period lease, statute of frauds applies for 1 year or more
2. Periodic tenancy - continues for successive period to period, termination uncertain 3. Tenancy at will - landlord and tenant each have right to terminate, can be implied for tenant 4. Tenancy at sufferance - tenant wrongfully remains in possession 5.Holdover tenant - landlord may evict OR create periodic teanancy by accepting rent |
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Landlord Duties
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1. Deliver Premises - VA requires landlord to ensure that the tenant, peaceably and quietly, can enter on the leased premises at the beginning of the lease term
2. Quiet enjoyment 3.Implied warranty of habitability In VA must disclose mold - tenant can object to statement of no mold within 5 days |
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Tenant's Duties
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Duty to Repair
1. voluntary waste - absolute liability for intentional or negligent damage 2. permissive waste - ordinary repairs yes, but no duty to make substantial repairs 3. ameliorative waste - NO substantial alterations even if they increase value 4. destruction of premises without fault - obligation to pay rent terminated if improvements on lease <7 years destroyed by fire or unavoidable accident 5. Pay rent |
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Landlord Remedies
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Failure to pay rent
1. Evict - unlawful entry or detainer claim must be brought within 3 years 2. Sue for rent Vacates without paying rent 1. do nothing and tenant remains liable 2. Repossess and/or relet - liability depends on whether landlord accepted surrender |
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Assignment
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Transfer entire balance of lease
Original tenant in privity of contract with landlord Assignee in privity of estate with landlord |
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Sublease
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Incomplete transfer of balance of lease
Only original tenant liable to landlord for rent Subtenant not privity with landlord |
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Tort Liability of Landlords and Tenants
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Landlord
1. latent defects - knowledge and failure to disclose dangerous condition tenant could not discover with reasonable inspection 2. landlord contracts to repair 3. legal duty to repair by statute Tenant 1. dangerous conditions or activities |
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Termination of Periodic Tenancies
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Written notice
1. 3 months for year-to-year lease 2. 30 days for month-to-month 3. 7 days for week-to-week |
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Fixtures
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1. Chattel incorporated into structure?
2. If not, annexor's intent -nature of article -manner of attachment -damage removal would cause -adaptation of item to use of realty 3. Fixture passes with conveyance of realty and mortgage attaches |
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Easements
-types -creation -termination |
Right to use land of another
-affirmative = affirmative use of servient tenement -negative = servient tenement refrains from engaging in activity Types of easement 1. appertunant -grantee of dominant tenement receives easement automatically -grantee if servient tenement takes subject to easement unless grantee is BFP without notice 2. easement in gross -right separate from ownership of property - no dominant tenement Creation 1. express grant 2. express reservation by common owner 3. implication by existing use 4. implication by necessity 5. Prescription - VA time = 20 years Termination 1. stated conditions 2. unity of ownership 3. release 4. abandonment 5. estoppel 6. prescription 7. necessity ends 8. condemnation or destruction of servient estate 9. VA = original purpose for easement no longer exists |
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Licenses
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revocable privilege to go on land of another
NOT assignable VA oral easement, which creates license, then change of position in reasonable reliance by holder of servient estate creates 'equitable easement' aka 'irrevocable license' |
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Profits
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nonpossessory interest in land entitling the holder to enter upon servient tenement to remove soil or products of soil
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Covenants Running with the Land
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Requirements for Burden to Run
1. intent 2. notice 3. horizontal privity 4. vertical privity 5. touch and concern Requirements for Benefit to Run 1. intent 2. vertical privity 3. touch and concern VA = covenants not to compete do NOT run with the land |
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Equitable Servitude
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covenant that equity will enforce against assignees of the burdened land who have notice
Implication from common scheme 1. common scheme 2. notice - actual, inquiry, record Enforcement - requirements for burden to run 1. intent 2. notice 3. touch and concern 4. privity not required 1. |
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Adverse Possession
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1. continuous and uninterrupted - VA = 15 years
2. open and notorious 3. actual and exclusive control of land 4. hostile Disabilities toll statute - minority, imprisonment, insanity (cannot extend beyond 25 years in VA) In condition subsequent situation, clock starts when condition happens, not as in most states when right to reentry exercised |
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Conveyancing
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Statute of frauds
1.description 2. identification of parties 3. price Part performance -specific performance despite absence of writing if two satisfied: 1. possession 2. improvements 3. payment Equitable conversion - once contract signed buyer owns and assumes risk of loss |
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Marketable title
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implied warranty in every land sale contract
1. no defects in chain of title 2. no encumbrances Remedies 1. recission 2. specific performance 3. damages In VA if sale in gross then acreage ignored, if sale by acre then must be right number of acres VA seller of 1-4 dwelling units must disclose physical condition of property or say that it is sold as is - misrepresentation allows buyer to terminate In VA implied warranty on new dwelling - free from structural defects,workmanlike manner, fit for habitation to best of his knowledge - 1 year warranty, 2 year statute of limitations on suit |
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Deeds
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Formalities
1. statute of frauds - must be in writing 2. describe land and parties 3. words of intent 4. signature 5. NO consideration, seal, attestation necessary Delivery 1.manual 2. presumption of delivery -handed to grantee -acknowledged by grantor before a notary (VA two witnesses) OR -recorded (not necessary in VA) 3. delivery to 3rd party watch for equitable conversion and ademption VA Statutory special warranty deed - seller warrants only that seller herself has done nothing to create a title defect |
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Covenants in Deeds
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1. general warranty deed - gives 'usual covenants for title'
2. statutory special warranty deed - implied assurances that: -same estate has not been conveyed to person other than grantee -estate free from encumbrances made by grantor 3. Quitclaim -grantor releases whatever interest grantor had - no covenants 4. Estoppel by deed |
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Recording
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provides constructive notice of property conveyance and protect BFPs
1. Notice statutes - subsequent BFP with no actual or constructive notice prevails over prior grantee who failed to record 2.Race notice statute - subsequent BFP is protected only if he records before prior grantee VA is notice jurisdiction VA does not recognize inquiry notice |
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Mortgage Transfers
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all parties to mortgage can transfer
1. trasfer by mortgagee - mortgage automaticallu follows transfer of note 2. transfer by mortgagor - grantee takes subject to mortgage |
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Defenses and discharge of the Mortgage
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1. underlying obligation - failure of consideration, duress, mistake, fraud
2. discharge of the mortgage -payment -merger -deed in lieu of foreclosure |
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Mortgagee Right to Possession before Foreclosure
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1. Lien theory - mortgagor deemed owner until forclosure (VA follows this but deed of trust more common)
2. Title theory - mortgagee is entitled to possession upon demand 3. intermediate theory - legal title in mortgagor until default, then in mortgagee |
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Foreclosure
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Redemption
1. in equity - mortgagor can redeem the land by paying amount due prior to foreclosure sale 2. statutory - mortgagor can redeem for fixed period after foreclosure sale Priorities 1. junior interests destroyed 2. senior interests not affected Deficiency judgments - if fund from foreclosure sale insufficient, mortgagee can bring personal action for deficiency mortgage or deed of trust can be enforced for 10 years |
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Intentional Torts: Prima Facie Case
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1. Battery = harmful or offensive contact to P'sperson
2. Assault = reasonable apprehension by P of an immediate harmful or offensive contact 3. False imprisonment = act confining P to bounded area 4. IIED = extreme and outrageous conduct causing severe emotional distress (VA P not required to show injury) 5. Trespass to Land = physical invasion of P's land 6. Trespass to Chattel = interference with P's right of possession in chattel 7. Conversion = an interference with P's right of possession so serious as to warrant that D pay full value |
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Intentional Torts Defenses
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1. Consent - capacity, express, implied by custom and usage or P's conduct, D remained in boundaries
2. Defense (self, others, property) - reasonable belief tort is being or is about to be committed, reasonable force -VA follows majority rule on defense of others - defender reasonable believes aided person would have right of self-defense 3. Necessity - only property, if private then damages for actual injury caused |
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Defamation
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1. defamatory statement about P
2. publication 3. injury to reputation - presumed if libel per se - special damages need not be proved (compare libel per quod - not defamatory on its face) 4. fault if the matter is one of public concern 5. public figure = achieved pervasive fame or notoriety, interjected himself into public controversy -Malice - D had knowledge that statement was false, reckless disregard as to truth 6. Private person - need not prove malice Defenses 1. truth 2. absolute or qualified privilege (malice negates) 3. statements of opinion |
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Privacy
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1. Appropriation by D of P's name or picture for D's commercial advantage
2. Intrusion by D into P's privacy or seclusion 3. Publication of facts placing P in false light 4. Publication of private facts about P |
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Misrepresentation
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Intentional
Negligent |
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Negligence
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1. Duty of Care
2. Breach 3. Causation 4. Damages Per se - was statute violated? |
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Duty of Care
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1. Foreseeable P
2. Standards -professionals (possess and exercise knowledge and skill of a member in good standing) -children (VA child <7 cannot be negligent, 7-14 rebuttable presumption that cannot be negligent) -owners of land -common carriers -places of public accommodation VA rejects attractive nuisance doctrine but accepts greater duty of care when kids involved |
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Breach
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Did D meet standard of care?
Res ipsa loquitur |
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Causation
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1. Actual (causation in fact)
2. Proximate (based on lack of foreseeability) -direct cause -indirect cause |
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Defenses to Negligence
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VA common law contributory negligent
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Negligent Infliction of Emotional Distress
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1. foreseeable risk of physical injury
2. zone of danger requirement - VA requires this for bystander recovery as well) 3. Physical injury required In VA bystander cannot recover from seeing accident if outside 'zone of danger' |
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Strict Liability
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Prima Facie Case
1. absolute duty on D to make safe 2. breach 3. causation - actual and proximate 4. damages Abnormally dangerous activities Dangerous animals |
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Products Liability
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Strict Products Liability
1. absolute duty owed by commercial supplier -manufacturer, wholesaler, retailer -owed to users, consumers, bystnders, NO privity required -applies only to products 2. breach (3 types) -defectively designed = not safe for intended use or could have been made safe without serious impact on price or utility -defectively manufactured -failure to warn -No breach if substantially altered after left D's control 3. Causation - actual and proximate 4. Damages - same as negligence, economic loss Negligence Intentional Torts -Must prove D intentionally put a dangerous product in stream of commerce - use prima facie case for battery Implied warranty -merchantability -fitness for a particular purpose Express warranty/Misrepresentation |
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Vicarious Liability
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Respondeat superior
1. employer/employee relationship 2. tort committed within scope of employment Auto owner/driver - VA rejects family car doctrine whereby operator being related to owner does not make owner negligent Parent/child - VA parents liable for up to $2,500 of damages from willful or malicious tort of child Barkeeper Husband/wife |
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Joint tortfeasor
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1. releases
2. contribution 3. indemnification |
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Types of Negotiable Instrument
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(Promissory) Note
Draft or 'Bill of Exchange', Check |
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Formal Requirements of Negotiability (WOSSUPP)
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1. written and signed
2. payable to order payer 3. signed by maker or drawer 4. reciting sum certain 5. containing unconditional promise or order and no additional promises or orders 6. payable on demand or at a definite time 7. payable in currency |
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Commercial Paper Definitions
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1. promisor = maker
2. promisee = payee 3. drawer = gives the order 4. drawee = ordered to do the paying 5. payee = beneficiary of the order 6. indorser = signs the back |
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Proper Negotiation of Commercial Paper
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Payable to order
-payable to specific payee -any further negotiation requires indorsement by payee Payable to bearer -indorsement not required |
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Types of Indorsement
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Special = names particular person as indorsee who must sign for further negotiation
Blank = can be negotiated by delivery alone Restrictive = contains a condtition -'for deposit only' -if bank cashes, indorsee can sue for conversion Unrestrictive |
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Holder in Due Course Elements
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1. holder in possession
2. pay value 3. good faith -honesty in fact (subjective test) -reasonable commercial standards of fair dealing (objective test) 4. no notice of claims or defenses Shelter Rule applies even if donee could not meet HDC on his own Only real defenses apply (not personal) |
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Defenses to Commercial Paper Liability
-Personal -Real |
Personal
1. lack of consideration 2. unconscionability 3. waiver 4. estoppel 5. fraud in the inducement Real (MAD FIFI4) 1. material alteration (change in terms) 2. duress 3. fraud in the factum 4. incapacity 5. illegality 6. infancy 7. insolvency |
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Commercial Paper Liability
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Warranty or Transfer Liability
1. D = any transferor who sells negotiable instrument 2. P = -any P in possession of instrument indorsed by D -immediate transferee of instrument not indorsed by D Contract or Signature Liability 1. D signed the negotiable instrument -maker (note) -indorser (signs back) -drawer (signs check) writing 'without recourse' = disclaimer of liability |
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Commercial Paper Warranties by D
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1. P has good title to instrument
2. all signatures genuine and authorized 3. instrument has not been materially altered 4. enforceable = no defense or claim good against D 5. D has no knowledge of any bankruptcy or insolvency action against maker or drawer |
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Properly Payable Rule
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Drawee bank that honors forged check must recredit drawer's account BUT drawee liable if negligent (failure to exercise ordinary care)
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Employee Endorsement Rule
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employer liable for forgeries by an employee entrusted with handling checks
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Bank Statement Rule
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customer must report wrongdoing to bank within 30 days of receiving a bank statement showing the problem
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Imposter Rule (Fictitious Payee Rule)
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if imposter induces drawer to write a check then drawer is negligent (leaving blanks or spaces on instrument, failure to follow internal procedures)
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Collateral for Secured Transactions
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Tangible
1. consumer goods 2. equipment 3. inventory 4. farm products 5. fixtures -classified by primary use (subjective) Intangible 1. patents, trademarks, copyrights 2. stocks, bonds, funds 3. proceeds from sale of collateral 5. accounts - right to payment for goods or services 6. promissory notes and drafts |
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Attachment
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Creation of security interest
Must have ALL: 1. agreement to create security interest - possession OR written security agreement OR control over certain types of collateral -record must be authenticated by debtor (signature or electronic) and reasonably identify collateral 2. value (including antecedent debts) must be given by secured party 3. debtor must have rights (ownership) in the collateral |
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Perfection
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Filing financing statement
1. UCC-1 standard form with State Corporation Commission in VA (state where debtor located, principal residence or state where organized, except timber mineral, fixtures in county where blackacre located) 2. sufficient info to make follow-up inquiries 3. contents -debtor's name and address -creditor's name and address -description of collateral Taking Possession Automatic -PMSI in consumer goods -small scale assignments of accounts or payment intangibles -sales of payment intangibles or promissory noted -beneficial interests in decedent's estate -investment property |
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Priority of Security Interests
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1. Buyer in ordinary course
2. Perfected attached creditor 3. Lien creditor - used to be GUC who gets judicial lien 4. Non-ordinary course buyer 5. Attached Unperfected Creditor 6. General Unsecured Creditor |
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Attached Unprotected Creditor wins against
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1. debtor
2. subsequent AUP 3. General Unsecured Creditor |
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Purchase Money Security Interest (PMSI) wins against
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Equipment - Earlier in time after-acquired collateral financier perfected attached creditor (AACF PAC) IF files properly within 20 days after debtor takes possession of collateral
Inventory - earlier in time AACF PAC by filing properly before debtor takes possession AND notify AACF before debtor takes possession |
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Self-help Repossession
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OK if do not breach the peace = repo likely to produce violence = repo made over ANY protest
CANNOT misuse color of law home = zone of privacy, requires contemporaneous and voluntary consent Can also obtain judicial writ to get sheriff to do it |
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Strict Foreclosure
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secured party retains collateral and debt is discharged
Goods = send proposal to debtor and secondary obligors Not goods = send proposal to debtor, secondary obligors, other secured parties who informed, and perfected creditors 60% Rule = No strict foreclosure if debtor has paid 60% of loan or price -instead sell within 60 days or debtor can sue for conversion |
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Sale of collateral
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Public or private sale
UCC Art. 9 requirements 1. every aspect of sale commercially reasonable\n2. reasonable notice -goods = debtor and secondary obligor -not goods = debtor, secondary obligor, secured parties who have advised, perfected creditors -content --public = time and place, --private = time after which sale will be made --consumer goods mandatory inclusions = how to calculate deficiencies, how debtor can redeem Secured party may buy at public sale but not private |
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Action for Deficiency Judgment
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sue debtor for money still due after sale
price = what independent 3rd party would pay |
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Debtor's limited right to redemption
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cut off when collateral sold or strict foreclosure
must repay amount owed (missed payment) + interest + creditor's reasonable expenses including attorney's fees Acceleration clause = pay entire debt + interest + expenses |
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Solicitation Rule
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Prohibited in personal injury or wrongful death unless client is family member or previous client
Otherwise ok unless deceitful or coercive Letters are ok if not misleading or deceptive Can say 'certified' in a particular area BUT must say VA has no certification process |
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VA Limits on Duty of COnfidentiality
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MUST reveal intention to commit a crime (not limited to bodily or financial harm) after first trying to dissuade
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VA Perjury by Criminal D Rule
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First try to dissuade, then withdraw, if cannot withdraw, tell judge
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Shareholder derivative suits
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Requirements
1. contemporaneous stockholder - hold at least 1 share 2. make demand on directors which must be rejected or 90 days past Committee of 2 or more independent directors can investigate and move for dismissal if suit not in best interest of corp Recover goes to corp itself - individual director limited to $100,000 or director's past 12 month comp |
