Remedies Outline for the California Bar Exam


Generally

  1. GeneralApproach

    1. Determine area of substantive law. (may be more than one)

      1. Usually torts, property or contracts.

    2. Make sure plaintiff has a case and a relief is needed.

    3. Determine appropriate remedies (based on available remedies for that substantive area of law).

      1. Discuss legal remedies first

      2. Discuss restitutionary remedies

        1. Legal remedies

        2. Equitable remedies

      3. Discuss pure equitable remedies.

Discuss ALL potentially available remedies unless a specific remedy is asked about

TORT Remedies

OVERALL TORT APPROACH:

  1. Has P been/being injured? compensatory damages

  2. Has D derived an Unjust Enrichment? restitutionary damages

  3. Does P want the property back? Replevin, Ejectment, SP

  4. Does P need an Injunction? Preliminary, TRO, Permanent

  1. LegalRemedies

    1. Damages

      1. CompensatoryPuts injured party in the same position as she would have been had the injury not occurred. Payment must be one lump sum, discounted to present value, w/ inflation not taken into account. (MT- inflation is considered)

        1. Requires

          1. Causation – Actual causation (but for test)

          2. Foreseeability – at the time of the act (proximate cause)

          3. Certainty – Damages cannot be too speculative.

            1. Past losses must be established w/ more certainty than future losses

            2. All or Nothing Rule: Future damages require P to show “more likely to happen than not” to recover – if he can’t prove, then he gets nothing for future damages

              1. Discuss probability of future events occurrence

              2. Lost Profits

                1. Historical Records helps – i.e. no new business

              3. Medical Expenses

            3. Non-economic damages (general damages) – Certainty rules do not apply

              1. Pain and suffering etc (don’t require certainty.

          4. Unavoidability/Duty to MitigateP must make reasonable effort to mitigate; (damages limited to those that could not reasonably have been avoided)

      2. NominalAwarded when no actual injury to vindicate P’s rights.

      3. PunitiveAwarded to punish the defendant

        1. P must have first been awardednominal, compensatory OR restitutionary damages

          1. On exam 1st right about above damages then discuss punitive

        2. D’s fault must be greater than negligence – i.e. intentional act by D

        3. Due Process Limitations – cannot be grossly excessive – D must have had fair notice of the possible magnitude

          1. Relatively proportional to actual damages – as actual damages increase, so do punitives.

          2. Reprehensibility of D’s conduct, disparity b/n harms suffered (single digit ratio), awards in other cases

  2. Restitutionary Damages – Theory is to prevent Unjust Enrichment2 types:

    1. LegalRestitutionary Damages

      1. Legal Restitutionary Money DamagesDamages based upon the value of the benefit conferred to the D.

        1. May be by the amount it benefits particular defendant

        2. Punitive damages may be attached if underlying COA is in tort.

        3. Cannot get both compensatory and restitutionary, P will sue on theory that provides the greatest recovery

        4. Examples:

          1. D injures P in a car accident = Comp only

          2. D uses P’s road to cut 10 miles from trip = nominal and rest

          3. D steals your machine and uses it in his biz = comp and rest, BUT cannot get both comp and rest, P will sue for damages that will give greatest recovery

            1. Comp for rental cost to replace

            2. Rest for benefit machine conferred on the D

            3. P could also sue for punitive for the intentional tort

        5. No Restitution for Encroachment or Nuisance

      2. ReplevinAction to recover possession of specific personal property.

        1. Requirements

          1. The plaintiff has a right to possession.

          2. There is a wrongful withholding by the defendant.

        2. Timing – May recover before trial if

          1. Preliminary judicial hearing and P posts a bond.

            1. D gets the bond (for P’s wrongful possession) if P loses

          2. D may defeat P’s bond by posting a redelivery bond(and D can keep chattel until after trial).

          3. Sheriff recovers property.

        3. Almost always coupled with damages for lost use OR benefit to D during time of detention.

      3. EjectmentAction to recover possession of real property

        1. Requirements

          1. The plaintiff has a right to possession.

          2. There is a wrongful withholding by the defendant.

        2. Only available against D who has possession of prop.

          1. Ex: adverse possessor/holdover tenant, trespasser on prop

        3. Sheriff ejects D

        4. Almost always coupled w/ damages (restitutionary or compensatory) for lost use OR benefit TO D during time of wrongful withholding.

        5. Ejectment does not give rise to punitives

    2. EquitableRestitutionary Damages: CT & EL only used when D has wrongfully acquired title to P’s prop

      1. Constructive TrustImposed on improperly acquired property to which defendant has wrongfully acquired title

        1. Result – D serves as trustee and must return property to P

        2. No deficiency judgment available

        3. P must be able to trace his property to D’s property

        4. P becomes SECURED creditor and gets the benefit of any enhanced value of the property

      2. Equitable Lienslien imposed on improperly acquired prop to which D has title to secure debt to P

        1. Result – Court imposes forced sale w/ proceeds to go to P.

          1. Deficiency judgment – If the sale does not cover the value of the thing taken.

        2. Can be imposed on prop that D wrongfully acquired title or that was improved w/ P’s property or proceeds from P’s prop (unlike CT)

        3. Can be enforced only up to the amount of P’s claim, enhanced value cannot be recovered

        4. Gives P priority over other creditors

      3. Rules for imposition of CT and EL remedies.

        1. An inadequate legal remedy.

          1. D insolvent, or for CT’s, the prop is unique.

        2. Tracing allowed

          1. If equitable lien – If traced to bank account, then balance limited to lowest account balance between time of wrongdoing and suit is all P can recover

        3. BFP prevails over P

        4. P will prevail over unsecured creditors to the extent of the trust or the lien. For deficiency judgment, w/ EL, you stand on same footing as other unsecured creditors.

      4. Deciding which to use.

        1. If the value of the property goes up – Use constructive trust.

        2. If the value of the property goes down – Use equitable lien (to force sale) + DJ (recover loss in value)

        3. If the property cannot be traced solely to P’s property, only an equitable lien is available.

          1. Ex: D used P’s money to pay for ½ of a house D cannot get CT over entire house but can get EL to force sale and recover P’s money

  3. Pure equitableremedies

    1. Injunctive ReliefDefendant is ordered to do or refrain from doing something.

      1. Temporary – issued pending a full trial on the merits.

      2. Permanent – issued after a full trial on the merits.

    2. Preliminary Injunction

      1. Requirements

        1. Irreparable injury

          1. P will suffer irreparable harmif have to await trial. (time frame context)

          2. Balancing of hardships – irreparable injury is balanced against any hardship D will suffer if a temp injunction is granted.

          3. Buzz Words – Preserve the status quo until the trial.

        2. Likelihood of success on the merits – P must establish

        3. Posting of bond – P has to post a bond (to reimburse D if injunction injures D and P not successful).

          1. Damages are not usually limited to the amount of bond.

        4. Adversarial procedure and notice to opposing party.

    3. Temporary Restraining OrderIssued pending a hearing to determine whether temporary injunction should issue.

      1. Test (same as above)

        1. Irreparable injury

        2. Likelihood of success on the merits.

        3. Notice and adversarial proceeding not required

          1. i.e. ex-parte relief is OK

          2. Notice should be given if opportunity to do so.

      2. Limitation – usually limited to 10 days (14 in fed crt)

    4. Permanent Injunctive Relief

      1. PI = I Put Five Bucks Down

        1. Inadequate legal remedy

        2. Property right/Protectable interest

        3. Feasibility or Enforcement

        4. Balancing of Hardships

        5. D’s Defenses

      2. Always remember $ damages are given if PI denied

      3. 5 Requirements:

        1. Inadequatelegalremedy

          1. Replevin – Sheriff will not/cannot recover, or D’s redelivery bond (and D will destroy personal prop out of spite)

          2. Ejectment – Sheriff will not eject

          3. Money damages inadequate

            1. Too speculative

            2. Tort only threatened.

            3. Insolvent D

            4. Irreparable injury (loss to unique prop/bodily injury or damage)

            5. Multiplicity of actions (prior history of lit.)

          4. Land – is unique

        2. Property Right/Protectable Interest Requirements

          1. Trad. – Must have protectable property interest

          2. MT – Any protectable interest will suffice.

        3. Feasibility of enforcement

          1. Types

            1. Negative Inj. – Stop doing something.

              1. No enforcement problem

            2. Mandatory Inj. – To do something/affirmatively perform act

              1. Possible enforcement problem because of

                1. Difficulty of supervision

                2. Difficulty in ensuring compliance

              2. Applications

                1. Great skill, taste or judgmentdenied

                2. Series of acts over timedeniedunlessP’s harm is great

                3. Out-of-state act req’d by Dgrant if D is resident, deny if D is non-resident.

        4. Balancing of hardships – P’s benefit v. D’s hardship.

          1. Rules:

            1. There must be gross disparity b/n detriment and benefit, in favor of P

            2. No balancing if D’s conduct was willful.

            3. If no willful conduct by D and hardship substantially outweighs benefit, then no injunction. May award money damages.

            4. Then, consider hardship to the public

              1. Ex: loss of public jobs

          2. Discuss: P’s interests, D’s hardships, Public hardship, decide injunction issue, if denied, then money damages.

          3. Tip: balancing of hardships should always be discussed when tort is nuisance or trespass to land.

            1. Encroachment: if intentional, no balancing (P will always win); if innocent (includes neg), ct will balance, but lean in favor of P seeking removal of encroach.

            2. Nuisance: always balance.

        5. Defenses Must be Overcome (see below)

    5. Defenses to EquitableRemedies

      1. Unclean Hands – The party suing must not be guilty of unfair dealing with respect to the transaction sued upon.

        1. Address UCH defense, even if facts don’t apply to transaction

      2. LachesUnreasonable delay by P in initiating equitable claim which causes prejudice to D.

        1. Clock starts when P knows of injury.

        2. Right to relief cut off – When delay has been both unreasonable and prejudicial to defendant.

        3. If laches appliesaward P money damages.

      3. Impossibility – Impossible for the defendant to carry out terms of injunction.

      4. Free Speech – If defamation/privacy publication tort, best defense is freedom on speech (injunction denied based on 1st A).

  4. Injunctive Relief Issues

    1. Crimes – Equity will not enjoin crimes.

      1. Recharacterize as a tort.

      2. Exception for nuisance/public nuisance and partial exception for crime that is also a tort.

    2. Who is bound – parties, agent/employees, and others acting in concert w/notice

    3. Erroneous Injunctions – Injunctions must be complied with until modified or dissolved.

    4. Contempt

      1. Civil – to coerce

        1. Fines (money) to coerce

        2. Imprisonment (D holds keys to the jailhouse door)

      2. Criminal – to punish

        1. Fines (money) to punish

        2. Imprisonment – Remain in jail for set amount of time.

          1. Constitutional safeguards apply.

      3. No contempt for failing to comply w/ $ judgment, unless child support or alimony.

    5. Dispossession of loan – Injunction not allowed since ejectment adequate.

    6. Encroachment – Restitution is not allowed. Injunctions allowed.

    7. Nuisance – consider traditional damages, permanent damages, and past damages. Restitution – Not allowed.

    8. Personal Injury

      1. Special Damages – Economic losses (more certainty)

      2. General damages – Non economic losses (no certainty required)

      3. Look to mitigation of damages.

    9. Fraud – Some jurisdictions use benefit of bargain, some apply out of pocket loss. Punitive damages allowed.

CONTRACT Remedies

OVERALL CONTRACT APPROACH:

  1. Has P been/being injured? Expectation Damages

  2. Has D derived an Unjust Enrichment? Restitution

  3. Does P want the property back? replevin, ejectment, CT, EL

  4. Does P want the K performed? SP

  5. Does P want the K ripped up? Rescission

  6. Does P want the K re-written? Reformation

  1. Legal Remedies

    1. 4 types of Ks: (1) Land Sale; (2) Personal Property; (3) Construction; (4) Personal Services

    2. Damages

      1. Expectation Damages – Compensatory damages.

        1. Requirements for comp damages

          1. Causation

          2. Foreseeability (at time of Kformation)

          3. Certainty

          4. Unavoidability/Duty to Mitigate

        2. Consequential Damages – available for related damages foreseeable at the time of formation.

          1. Can includereputation damage

        3. Incidental Damages – hassle damages

      2. Nominal Damages – Allowed

      3. Punitive DamagesNot Allowed

        1. Unless activity can be recharacterized as a tort case (if willful)

      4. Liquidated damages – Damages specified in K. Law does not allow a penalty.

        1. Test for validity of clause:

          1. Damages must be difficult to ascertain at the time of formation.

          2. Must be a reasonable forecast (if too high it’s a penalty)

        2. Note: Can’t recover both compensatory and liquidated damages.

        3. If Valid:only liquidated damages amount available, and no actual

          1. But can get other remedies outside of actual damages (SP etc.)

        4. If Invalid:only actual damages available

          1. Dismiss clause, and analyze actual damages amount)

  2. Restitutionary Remedies – To prevent unjust enrichment.

    1. LegalRestitutionaryRemedies

      1. RestitutionaryDamages = Unjust Enrichment

        1. Basic fact pattern: K fails after P has rendered performance b/c:

          1. K is unenforceable

          2. K is breached.

        2. Unenforceablecontracts (mistake, lack of capacity, SOF, illegality)

          1. P can get Restitutionary damages (for prop/money given or services rendered for D). Measured by the value of the benefit conferred to D.

            1. May be more than the contract rate.

          2. May recover property if: unique or D insolvent.

        3. Breachedcontract.

          1. Non-breachingP

            1. P can get Restitutionary damages (for prop/money given or services rendered for D). Measured by the value of the benefit conferred to D.

              1. May be more than the contract rate.

            2. May recover property if: unique or D insolvent.

          2. BreachingPlaintiff

            1. Restitutionary damages –

              1. TraditionalNo recovery allowed.

              2. ModernRecovery allowed, but limited to K priceand must be offset to reflect D’s damages.

                1. Cannot be greater than K rate.

      2. Replevin – Above

      3. Ejectment – Above

    2. EquitableRestitutionaryRemedies

      1. Constructive Trust – Above

      2. Equitable Lien – Above

  3. Equitable Remedies

    1. SpecificPerformance

      1. Memorizer – Cha Cha Is My Favorite Dance

      2. Requirements

        1. Contract is Valid/Certain & Definite.

          1. Contract terms must be shown with more certainty and definiteness than for money damages.

        2. Contract Conditions of P Must be Satisfied

          1. P must be able to show his K conditions have been fulfilled (already performed, ready and able to perform, or excused from performing).

          2. Land sale contracts – Deficiency fact pattern

            1. Seller as Plaintiff:

              1. May enforce if defect minor

              2. Cannot enforce if defect is major, unless seller can cure b/4 closing

            2. Buyer as Plaintiff:

              1. May enforce if defect is major.

              2. Cannot enforce if defect very major.

            3. Note: If SP granted, must note that ct will lower purchase price to take defect into consideration(“ABATEMENT” in purchase price)

          3. Time is of the Essence” w/ forfeiture provision – fact pattern: LSC contains time is of the essence clause with forfeiture provision, there is some partial performance, the buyer makes a late payment, thus triggering the time and forfeiture clause and seller wants to keep both the land and any payment performance rendered by buyer.

            1. Rule:Equity abhors forfeiture give buyer the land

              1. Factors:

                1. Loss to seller is small.

                2. Tardiness is de minimus.

                3. Waiver

                4. Undue hardship.

              2. If no SP, then grant restitutionary relief (MT)

              3. If K wholly executory, time of essence K will be strictly enforced.

        3. Inadequate Legal Remedy

          1. Alternative money damages must be inadequate.

            1. Speculative

            2. D’s insolvent

            3. If multiple suits would be necessary.

            4. The thing bargained for is unique

              1. LAND IS ALWAYS UNIQUE.

                1. Special “seller’s” rule: S of land can get SP even though all they have coming is $ (i.e. purchase price)

              2. Personal property not uniqueunless

                1. One of kind or very rare.

                2. Personal significance to Buyer.

                3. Circs. make chattel uniqueat time of litigation.

            5. Liquidated damages clause is not adequate Can still get SP. Unless clause makes it clear that it is the sole remedy.

        4. Mutuality of Remedy – Ct must be satisfied that it can secure P’s counterperformance under K.

          1. Fact pattern

            1. D claims that since I cannot enforce against P, he should not be able to get SP against me.

            2. Court will reject mutuality agreement if it is secure that P can and will perform (this is evidenced by P (minor/incapacitated) bringing the subject suit

            3. Ct will grant SP and arrange for simultaneous performance.

        5. Feasibility of Performance

          1. SP cannot enforce Personal Service K b/c:

            1. Enforcement problems; & equivalent to involuntary servitude

        6. Defenses

          1. Equitable

            1. Unclean hands

            2. Laches

            3. Unconscionability – time of contract formation

            4. Waiver

            5. Estoppel

            6. Equitable Conversion

          2. Contract defenses

            1. Mistake

            2. Misrepresentation

            3. Statute of Frauds

              1. Part performance doctrine – Contract must involve land or testamentary disposition and must be oral.

              2. Rule: D will bypass SOF and get SP if:

                1. Rendered valuable part performance

                2. In reliance on the contract

              3. Any 2 of 3 will work:

                1. Payment (whole or part)

                2. Possession

                3. Valuable improvements (MT – valuable services).

      3. Specific Performance Issues

        1. Equitable Conversion (involves land sale K) – when K is entered into, buyer becomes the equitable owner and seller becomes the owner of personal property.

          1. If K specifically enforceable – EC has occurred upon execution.

          2. Occurs b/n K execution and closing:

            1. Death

              1. If seller dies, title goes to person entitled to seller’s real prop (heir or devise), while right to price goes to person entitled to seller’s personal prop (right to payment of purchase price).

              2. If buyer dies, his interest in land goes to person entitled to his real prop.

            2. Damage/Destruction

              1. Risk of loss assuming EC

                1. Maj – risk is on buyer, unless loss is due to seller’s negligence

                2. MT – risk on seller unless at time of loss, buyer has either legal title or possession.

              2. Right to insurance proceeds

                1. Whoever has risk of loss should get insurance

        2. Employment K – NOT specifically enforceable

          1. Poses enforcement problems

          2. Involuntary servitude

        3. Negative covenant enforceability (cov not to compete)

          1. 2 part test

            1. Cov must protect a legitimate interest of the person in whose favor it runs (t/4, service must be unique)

            2. Cov must be reasonable in both its geographical and duration scope.

          2. Damages inadequate where employee’s services are ordinary, but not where services are unique or where trade secrets/goodwill are involved.

    2. Rescission– (Good Dog); original K considered voidable and rescinded/cancelled

      1. Grounds for Rescission– Problem with contract formation.

        1. Mutual Mistake

        2. Misrepresentation

        3. Coercion

        4. Undue influence

        5. Lack of capacity

        6. Failure of consideration (material breach)

        7. Illegality

      2. Mistake

        1. Mutual Mistake

          1. If Material (affects basis of bargain) – Grant rescission.

          2. If Collateral (quality, desirability, fitness of property) – Rescission denied

        2. UnilateralMistake

          1. General Rule – Rescission denied.

          2. Exception if non-mistaken party knows or should know of the mistake.

        3. MT – grant rescission if party would suffer an undue hardship if there is no rescission.

      3. Misrepresentation – P can seek rescission on showing of actual reliance on a material misrep of fact.

        1. Reliancetest

          1. Innocent misrepresentation – Reasonable reliance.

          2. Intentional Misrepresentation – Actual reliance.

      4. Defenses

        1. Unclean hands.

        2. Laches

        3. Negligence is not a good defense

      5. Rescission Issues

        1. Election of remedies

          1. P Sues for damages first – No rescission.

          2. P Sues for rescission first – damages allowed.

          3. P can sue for both at the same time, but must elect preferred remedy b/4 judgment

        2. LegalRescission

          1. P may accomplish on own by

            1. Giving notice and tendering back consideration.

            2. Plaintiff sues for restitution for anything given to defendant (under quasi-K or replevin)

    3. Reformation – (Very Good Dog); Changes agreement to conform with the party’s original understanding.

      1. 3 requirements

        1. Valid contract– Must have mutual assent.

        2. Grounds for reformation.

          1. Mutual Mistakegrant reformation

          2. Unilateral mistake – Reformation deniedunless non-mistaken party knows of mistake (regarded as fraud/inequitable conduct)

          3. Misrepresentationgranted for both innocent and intntl misrep

          4. Fraud – an instrument fraudulently represented as incorporating the prior agreement

        3. Defenses – look for defenses

          1. Unclean hands.

          2. Laches

          3. Non-defenses

            1. Negligence of plaintiff

            2. SOF

            3. The Parol Evidence Rule.

          4. Sale to BFP – reformation not allowed if would adversely affect rights of subsequent BFP.

      2. Effect: parties bound to K, but terms are the ones parties intended.

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