Contracts Commons^™

Reframing The Dilemma Of Contractually Expanded Judicial Review: Arbitral Appeal Vs. Vacatur , Eric Van Ginkel

Pepperdine Dispute Resolution Law Journal

The Federal Arbitration Act ("FAA") of 1925 was created to ensure enforceability of agreements to arbitrate. The FAA is the centerpiece of the federal arbitration policy as construed by the Supreme Court. Section 10(a) FAA enumerates grounds on which an arbitral award can be set aside. The central issue discussed herein is whether parties can agree by contract to allow one of the parties to initiate review of the arbitral award by a court that would otherwise have jurisdiction over those parties, or whether the court's powers are somehow limited to the grounds for vacatur enumerated in Section 10(a) FAA. …

Bareboat Charters: Can A Shipowner Limit Liability To Third Parties? Answers For Owners Attempting To Navigate The Unsettled Waters In The Eleventh Circuit, John W. Chitty

Georgia State University Law Review

A bareboat charter is a contractual agreement akin to the lease of a vessel whereby most of the “customary liabilities” of the owner are shifted to the charterer. Some courts have raised concerns over bareboat charters—also referred to as a demise charter—regarding the ability of owners to use the bareboat device as a means to limit liability to injured third parties.

In Baker v. Raymond International, Inc. the Fifth Circuit brought force to this concern; the court held a bareboat charter would no longer shield owners from personal liability for third party injuries caused by the unseaworthiness of a vessel, …

"Expanded" Judicial Review Revisited: Kyocera Overturns Lapine, Eric Van Ginkel

Pepperdine Dispute Resolution Law Journal

Just when you thought you could validly add a clause to your client's arbitration agreement providing that the losing party may take an appeal from the award to the district court having jurisdiction over the parties, think again. What was the law of the Ninth Circuit since December 1997, when a three-judge panel of the Ninth Circuit Court of Appeals decided LaPine Technology Corporation v. Kyocera Corporation ("LaPine I"), has just been reversed by the Ninth Circuit Court of Appeals sitting en banc. In its decision, on a rehearing of what the court refers to as " …

Looking Into A Crystal Ball: Courts' Inevitable Refusal To Enforce Parties' Contracts To Expand Judicial Review Of Non-Domestic Arbitral Awards, Eric Chafetz

Pepperdine Dispute Resolution Law Journal

This article will first discuss the legislative history of the NY Convention in general and the history of its vacatur provisions in particular. Second, it will summarize certain federal court decisions that address the Expansion Issues and reach the Consensus. Third, it will argue that the Expansion Issues were resolved incorrectly, because the courts addressing them do not recognize how the operative/material language in section 207 of Ch. 2 of the FAA and section 9 of Ch. 129 of the FAA has a virtually identical meaning, and therefore should have been construed and applied in the same manner. Fourth, this …

Economical Litigation Agreements: The "Civil Litigation Prenup" Need, Basis, And Enforceability , Daniel B. Winslow, Alexandra Bedell-Healy

Pepperdine Dispute Resolution Law Journal

This article identifies the basis and limits of the parties' abilities to define and enforce discovery in an ex ante contract. Despite the deficiencies of litigation, the free, public dispute resolution forum of the civil justice system provides significant value in commercial disputes. That value can be used to maximum mutual advantage only if parties replace the infinite discovery permitted in conventional litigation with the finite discovery contracted in Economical Litigation Agreement (ELA) litigation. This article will help parties to understand the benefit and enforceability of the ELA.

Getting To Yes In Specialized Courts: The Unique Role Of Adr In Business Court Cases, Bejamin F. Tennille, Lee Applebaum, Anne Tucker Nees

Pepperdine Dispute Resolution Law Journal

The assumed compatibility between ADR and specialized courts is largely unexamined. Without being able to statistically validate the motivations and preferences of individual disputants in a manner to draw generalized conclusions, this article examines the relationship between ADR and specialized business courts by looking at how the two are structurally intertwined through existing procedural rules and implementation practices. Part I of this article describes the foundational structures and concepts behind both ADR and specialized business courts, as well as the similarities and differences between them. Part II explores the existing formal structural relationship between ADR and specialized courts by examining …

An Unnecessary Consternation: An Analysis Of The Future Of Eu Arbitration In The Wake Of The West Tankers Decision, Mark G. Materna

Pepperdine Dispute Resolution Law Journal

This article proposes that, despite the West Tankers decision, parties are still not free to breach the terms of an arbitration agreement. On the contrary, there has been a strong trend by English courts to find ways of preventing parties from breaching such agreements. In short, this article serves to quell the panic and elucidate that the West Tankers decision is not a nail in the coffin, but rather a mechanism to reiterate European courts' dedication to ensuring that arbitration provisions remain a potent force against economic infidelity. Part II of this article will provide a brief background of anti-suit …

Waiving Rights Goodbye: Class Action Waivers In Arbitration Agreements After Stolt-Nielsen V. Animalfeeds International , Diana M. Link, Richard A. Bales

Pepperdine Dispute Resolution Law Journal

This article first argues that to determine the enforceability of a class action waiver, courts should take a "totality of the circumstances" approach rather than adopting a bright-line rule. A set of defined factors that also allows courts to consider real-world issues facing litigants will provide a substantial framework for courts to interpret this area of the law and will lead to more consistent and well-reasoned outcomes in the future. These factors include: the probable size of each class member's individual recovery, the potential for retaliation against class members, the awareness of potential class members that their rights have been …

The Assault Of Jamie Leigh Jones: How One Woman's Horror Story Is Changing Arbitration In America, Jeffrey Adams

Pepperdine Dispute Resolution Law Journal

This article examines Jones v. Halliburton Co., the "Al Franken Amendment" to the 2010 U.S. Defense Department Budget (Franken Amendment) that was created in response to Jones, and the impact that both could have on mandatory arbitration clauses in employment contracts in the future. Part II recounts the troubling events that led to Jones and the inclusion of the Franken Amendment in the 2010 Defense Department Budget. Part III details the arguments made for and against the inclusion of the Franken Amendment. Part IV analyzes the impact that the Franken Amendment could have on mandatory arbitration clauses in contacts in …

The Dog That Didn't Bark: Private Investment Funds And Relational Contracts In The Wake Of The Great Recession, Robert C. Illig

Michigan Business & Entrepreneurial Law Review

In the aftermath of the subprime mortgage crisis, the contract rights of numerous hedge funds and venture capital funds were breached. These contracts were complex and sophisticated and had been negotiated at great time and expense. Yet despite all of the assumptions of neo-classical contracts theory, nothing happened. Practically none of these injured parties sued to enforce their rights. Professor Illig uses this dearth of litigation to conduct a form of natural experiment as to the value of contract law. Discrete market participants contracted before the crash and then pursued their rights in court afterwards, while relational market participants contracted …

The “Ensuing Loss” Clause In Insurance Policies: The Forgotten And Misunderstood Antidote To Anti-Concurrent Causation Exclusions, Chris French

Faculty Scholarship

As a result of the 1906 earthquake and fire in San Francisco which destroyed the city, a clause known as the “ensuing loss” clause was created to address concurrent causation situations in which a loss follows both a covered peril and an excluded peril. Ensuing loss clauses appear in the exclusions section of such policies and in essence they provide that coverage for a loss caused by an excluded peril is nonetheless covered if the loss “ensues” from a covered peril. Today, ensuing loss clauses are found in “all risk” property and homeowners policies, which cover all losses except for …

The Underappreciated Importance Of The Sequence In Which The Issues Are Addressed In Contract Litigation, Gregory S. Crespi

Faculty Journal Articles and Book Chapters

Judicial opinions rarely identify the precise sequence in which the issues presented were addressed by the court. Since this sequence is not generally regarded as being significant for the decisions reached, persons later parsing the opinions for their significance rarely go to the considerable trouble involved in acquiring the litigation briefs and interviewing the attorneys and judges involved so as to ascertain this sequence. However, my surmise is that at least in contract litigation the sequence in which the issues are addressed can sometimes be significant or even outcome-determinative for the results. A good example of this is presented by …

Restraining Amazon.Com's Orwellian Potential: The Computer Fraud And Abuse Act As Consumer Rights Legislation, Alicia C. Sanders

Federal Communications Law Journal

In 2009, Amazon.com decided to correct a potential copyright violation by deleting e-books by George Orwell and Ayn Rand from the Kindles of users who had already purchased the offending texts. Two of those users, Justin Gawronski and Antoine Bruguier, claimed that Amazon.com had violated the Computer Fraud and Abuse Act (CFAA) by accessing their Kindles without authorization. The plaintiffs also relied on other causes of action, including breach of contract and trespass to chattels. Although the dispute quickly settled, the Gawronski lawsuit remains a useful case study that shows why the CFAA is a useful protection for consumers. Recently, …

A Moral Contractual Approach To Labor Law Reform: A Template For Using Ethical Principles To Regulate Behavior Where Law Failed To Do So Effectively, Zev J. Eigen, David S. Sherwyn

Faculty Working Papers

If laws cease to work as they should or as intended, legislators and scholars propose new laws to replace or amend them. This paper posits an alternative—offering regulated parties the opportunity to contractually bind themselves to behave ethically. The perfect test-case for this proposal is labor law, because (1) labor law has not been amended for decades, (2) proposals to amend it have failed for political reasons, and are focused on union election win rates, and less on the election process itself, (3) it is an area of law already statutorily regulating parties' reciprocal contractual obligations, and (4) moral means …

Selling Sex: Analyzing The Improper Use Defense To Contract Enforcement Through The Lens Of Carroll V. Beardon, 59 Clev. St. L. Rev. 693 (2011), Julie M. Spanbauer

UIC Law Open Access Faculty Scholarship

The 1963 decision of the Supreme Court of Montana in Carroll v. Beardon occupies less than three full pages in the Pacific Reporter and involves a simple real estate transaction in which a "madam" sold a house used for prostitution to another "madam." The opinion is the last in a long line of cases which speak specifically to the issue of enforcement of facially legitimate contracts that in some manner involve or are related to prostitution. It is commonly cited in treatises and hornbooks as representative of the movement by courts toward enforcement of such contracts under the law of …

In Re Healthsouth Corp. Securities Litigation, Adam Paul Gordon

NYLS Law Review

No abstract provided.

The “Non-Cumulation Clause”: An “Other Insurance” Clause By Another Name, Chris French

Faculty Scholarship

How long-tail liability claims such as asbestos bodily injury claims and environmental property damage claims are allocated among multiple triggered policy years can result in the shifting of tens or hundreds of millions of dollars from one party to another. In recent years, insurers have argued that clauses commonly titled, “Prior Insurance and Non-Cumulation of Liability” (referred to herein as “Non-Cumulation Clauses”), which are found in commercial liability policies, should be applied to reduce or eliminate their coverage responsibilities for long-tail liability claims by shifting their coverage responsibilities to insurers that issued policies in earlier policy years. The insurers’ argument …

Consumer Harm Acts? An Economic Analysis Of Private Actions Under State Consumer Protection Acts, Henry N. Butler, Jason S. Johnston

Faculty Working Papers

State Consumer Protection Acts (CPAs) were adopted in the 1960s and 1970s to protect consumers from unfair and deceptive practices that would not be redressed but for the existence of the acts. In this sense, CPAs were designed to fill existing gaps in market, legal and regulatory protections of consumers. CPAs were designed to solve two simple economic problems: 1) individual consumers often do not have the incentive or means to pursue individual claims against mass marketers who engage in unfair and deceptive practices; and, 2) because of the difficulty of establishing elements of either common law fraud or breach …

Construction Law, D. Stan Barnhill

University of Richmond Law Review

No abstract provided.

Litigation And The Optimal Combination Of Vague And Precise Clauses In Contracts, Alvaro E. Bustos

Faculty Working Papers

In this paper we determine the optimal combination of precise and vague clauses written in contracts when the parties face writing and enforcement costs, the second ones in the form of litigation. We show that the parties may prefer to write vague instead of precise clauses not only because they are cheaper to write but also because they are cheaper to enforce. We extend Battigalli and Maggi (2002) to model the decision of a principal who chooses clauses to describe the actions that an agent has to perform. As both players observe nature imperfectly they may call for a court …

Contractual Valuation Mechanisms And Corporate Law, Keith Sharfman

Faculty Publications

(Excerpt)

Legal valuation—the resolution of disputes over the value of legal entitlements—is an inevitable aspect of any legal system. Across time and place and doctrinal boundaries, the problem is the same: each side seeks to have a self-servingly high or low figure assigned to the entitlement in question, and a mechanism is needed to choose a conclusive value from a range of plausible outcomes. Usually the mechanism involves litigation of some sort, such as a trial before a judge, jury, or hearing officer. But not always.

This Article analyzes a transactional alternative to valuation litigation that has become increasingly popular: …

'Prima Paint' Pushed Compulsory Aribitration Under The 'Erie' Train, Richard L. Barnes

ExpressO

As the face of commerce changes, the law usually follows, albeit at some distance. The United States Supreme Court has recently sped the pace. In a line of cases, some old, some recent, but all feeding off of one another, the Court has held that challenges to agreements which contain arbitration provisions must go to the arbitrator first. Courts may hear formational challenges only where they challenge the arbitration provision alone. In the Supreme Court, arbitration, with its vast potential for abuse as well as for good, has found a friend.

The Court’s doctrine of choice, “severability,” raises serious concerns …

The Relationship Between Defense Counsel, Policyholders, And Insurers: Nevada Rides Yellow Cab Toward "Two-Client" Model Of Tripartite Relationship. Are Cumis Counsel And Malpractice Claims By Insurers Next?, Jeffrey W. Stempel

Scholarly Works

It happens constantly in civil litigation. An insurance company hires a lawyer to defend its policyholder from a third party’s claim of injury. But just who is the lawyer’s “client?” Is it the policyholder who is the named defendant in the case and is “represented” in court proceedings? Or is it the insurer who, in most cases, selected the attorney, pays the attorney, supervises the litigation, and has (by the terms of the liability insurance policy) the right to settle the case, even over the objections of the policyholder? Ordinarily, the liability insurer has both the duty to defend a …

Theseus, The Labyrinth, And The Ball Of String: Navigating The Regulatory Maze To Ensure Enforceability Of Tribal Gaming Contracts, 40 J. Marshall L. Rev. 1123 (2007), Heidi Mcneil Staudenmaier, Ruth K. Khalsa

UIC Law Review

No abstract provided.

Disney Examined: A Case Study In Corporate Governance And Ceo Succession, Lawrence Lederman

NYLS Law Review

No abstract provided.

A Complete Property Right Amendment, John H. Ryskamp

ExpressO

The trend of the eminent domain reform and "Kelo plus" initiatives is toward a comprehensive Constitutional property right incorporating the elements of level of review, nature of government action, and extent of compensation. This article contains a draft amendment which reflects these concerns.

Airline Liability For Loss, Damage Or Delay Of Passenger Baggage, M. R. Franks

ExpressO

The article discusses remedies and methods of enforcing airline liability for loss, damage or delay of passenger baggage. The article includes a discussion of the law as it relates both to domestic flights and to international flights where passenger luggage is lost, damaged or delayed. The article includes a discussion of the Warsaw Convention as it relates to international flights and of the Federal Aviation Regulations applicable in the case of domestic flights.

Bond Repudiation, Tax Codes, The Appropriations Process And Restitution Post-Eminent Domain Reform, John H. Ryskamp

ExpressO

This brief comment suggests where the anti-eminent domain movement might be heading next.

Final Offer Arbitration In The New Era Of Major League Baseball, Spencer B. Gordon

ExpressO

This article provides a comprehensive analysis of the economic, athletic, and social impact of final offer salary arbitration in Major League Baseball (“MLB”). The article delves into the motivations, fluctuations, and evolution of the player-owner relationship and free agency. The commentary then focuses on the distinguishing features and intricacies of final offer arbitration. Although salary arbitration in the context of Major League Baseball is a topic oft discussed in the law review setting, the analysis rarely reaches the level exhibited in this article. Moreover, most articles on the subject were written between 1996 and 2000 when the 1994 players’ strike …