STUDENT I.D. NO.                            

     THESE EXAMINATION QUESTIONS MUST BE RETURNED AT THE END OF THE EXAMINATION.

SANTA CLARA UNIVERSITY SCHOOL OF LAW

MIDTERM EXAMINATION

CONTRACTS                                                    DECEMBER 16, 1996
PROFESSOR NEUSTADTER                       2 QUESTIONS; 3 HOURS

 

     The examination rules stated in the current Student Handbook govern  this examination, except that this is a limited open book examination. 

Instructions

1.  Limited open book examination:  During the examination you may consult your casebook, Selections for Contracts, Drafting Contracts, handouts distributed in class, and any notes, outlines or other work product prepared by you either individually or in working with other members of the class.  You may not consult any other material during the examination. 

2.  Provide analysis supporting your conclusions.

3.  In determining an appropriate grade for your examination, I look for ability to identify issues, demonstrated understanding of legal principles and relationships, skill in using the statutory law we have studied, accuracy, clarity and creativity of analysis, organization and conciseness of response, and good English expression.

4.  Suggested  time allocations:

     Question 1:   1-1/2 hours.

     Question 2:   Answer both parts.

                            Part A: 1 hour.

                            Part B: 1/2 hour.

QUESTION 1 (Suggested time: 1-1/2 hours)

     Sandra Seller opened a retail store in San Jose which bought and sold used entertainment merchandise (televisions, CD players, radios, etc.).  This was her first business venture.  Before opening the store Sandra was a mail carrier and, before that, she was a student.   

     One month after opening, Cal Consumer stopped in Sandra's store to shop for a large screen T.V.  Sandra had a large screen Mitsubishi 27DX on display for $750.  Cal was interested. Sandra told Cal that the display had been sold but that she was expecting to acquire a few more of the same model  within a month.  Cal said that he would buy one and Sandra said that she would sell him the next one that came in, for $750.00, if he left a $100.00 deposit.  Cal wrote her a check, for $100.00, which Sandra deposited in her bank account a few days later.  The check made no reference to the T.V., to the transaction for which it was given, or to the fact that the check was given as a deposit.   

     After handing Sandra the check, Cal asked if the television came with any guarantees.  Sandra responded: ``All of my sales come with a 14 day money back guarantee if you are dissatisfied for any reason, but there are no other guarantees because these things are used."

     Two weeks later, on October 31, Sandra called Cal.  She told him that she had just acquired a Sony large screen TV and asked him if he might be interested in the Sony rather than the Mitsubishi 27DX because the features and quality of the Sony were comparable to the Mitsubishi 27DX and because she was no longer sure how long it might be before she got her hands on a Mitsubishi 27DX.  Cal asked if he could try it out for a week and Sandra agreed.

     Sandra delivered the Sony to Cal on November 1.  Immediately after delivery, Cal was called out of town unexpectedly, and he did not return home until the morning of Monday, November 16.  Cal did not notify Sandra of his unexpected absence from town.  On Sunday, November 22, Cal dialed the telephone number of Sandra's store, having decided to tell her that he wanted to wait for the Mitsubishi 27DX because he didn't like the shape and appearance of the Sony.  He heard a voice mail message that the store was closed on Sundays and left a voice mail message informing Sandra of his decision and requesting that she pick up the Sony.  After the call, on Sunday afternoon, Cal turned on the Sony to watch a football game.  The screen went black one minute after he turned it on because, as Sandra and Cal later found out, an expensive electronic component had failed.

     Sandra returned Cal's call on Monday, November 23, and Cal then told her that the TV had broken down.  Sandra refused to pick up the TV, told Cal that she was not going to look for any more used Mitsubishi 27DX models, and demanded the balance of the purchase price.  Cal refused her demand and in turn demanded that she return his $100.00 or deliver a used Mitsubishi 27DX. 

      Sandra has sued Cal in small claims court for $650.00.  Cal has cross-complained.  You are the small claims court judge.  How should you decide the case and why?   In addition to rules which we have considered in our readings or in class, you may find Restatement Contracts 2d 69 and UCC 2-209(3) relevant to the analysis. 

QUESTION 2.  Answer both Part A and Part B.  (Suggested time allocation for both parts combined is 1-1/2 hours.)

      Julie Jogger was jogging on the sidewalk at night.  She noticed a dog limping in the middle of the street and feared the dog might be hit by an automobile.  Without looking or listening for approaching traffic, she darted into the street to save the dog.  A bicyclist riding toward her, whom she had not seen, swerved to avoid hitting her and, in doing so, was hit by an oncoming motorist who tried to stop as soon as the bicycle swerved into the line of traffic.  The bicyclist had been riding against traffic (i.e. was illegally riding on the wrong side of the street for the direction she was taking) and was wearing dark colored clothing.

     Julie and the dog were unhurt.  The bicyclist suffered a broken arm, concussion, and partial hearing loss, and the bicycle was destroyed.  The female driver of the automobile, an uninsured motorist, was uninjured, and the car suffered no damage, but the driver's baby daughter, sitting unrestrained by either seat belt or baby seat in the front seat of the car, had been thrown against the dashboard and suffered a skull fracture and a broken jaw.  The bicyclist and the baby were not covered by medical insurance.

     An ambulance called by a nearby resident took the injured parties to the hospital.  Thereafter, a rookie police officer arrived and took a very incomplete police report from Julie. 

     Part A: (Suggested time allocation: 1 hour)

     A few days after the accident, the bicyclist contacted Julie.  The bicyclist asked Julie for reimbursement of medical expenses to date and for money to buy a new bicycle.  The bicyclist also reported to Julie that a doctor had diagnosed the hearing loss as ``95% certain to be temporary" and that an expensive diagnostic test (which the bicyclist could not afford)  could confirm whether the hearing loss would be temporary or permanent. Julie offered to pay the bicyclist $1500 (payable in one month) in exchange for a complete release of all the bicyclist's claims against Julie arising from the accident and the bicyclist's promise to indemnify Julie from any loss resulting from any claim asserted by the motorist (on behalf of the injured child) against Julie.  The bicyclist at first dismissed the proposal as ridiculous, but later agreed to it after Julie said: (1) that Julie would also pay for the diagnostic test ($1,000) when billed by the doctor; and, (2) that if the bicyclist didn't agree, Julie would call the police officer who took the police report to inform him that the bicyclist had been riding on the wrong side of the street and had been wearing dark clothing.  Julie, with assistance from a lawyer friend, drafted, and she and the bicyclist signed, a release and indemnity document which accurately reflected their agreement.

     Julie failed to pay the $1500 or the doctor's diagnostic bill when due under the terms of the agreement with the bicyclist.  The diagnostic test has indicated that the bicyclist's partial hearing loss is likely to be permanent.  The bicyclist has consulted you for advice.  What advice will you give the bicyclist about her rights, if any, against Julie?  While your answer should include discussion of the effect of the release and indemnity agreement on any tort claim that the bicyclist might otherwise have against Julie, do not discuss the merits of the tort claim itself (e.g.  do not discuss negligence, contributory negligence, comparative fault, or tort damages). 

     Part B (Suggested time allocation: 1/2 hour)  

     The motorist (the mother of the injured baby) contacted Julie after the accident.  During the course of the conversation, the motorist mentioned her concern that the child's father not learn that the child was unrestrained in the front passenger seat at the time of the accident because he might use that information in an upcoming custody battle with the mother.  Julie said that she would refrain from sharing that information with anyone unless subpoenaed to answer questions under oath in any civil or criminal proceeding that might be instituted, if the motorist would agree, on behalf of herself and of the baby, to release all claims against Julie arising from the accident.  With the assistance of her lawyer friend, Julie drafted a document reflecting those terms and the two parties executed the document. 

      The motorist and the baby's father reconciled and abandoned divorce and custody proceedings.  The two parents have approached you for advice about whether they can recover any money from Julie for the child's injuries resulting from the accident.  What is your opinion and why?  Again, while your answer should include discussion of the effect of the agreement on any tort claim that the mother and father might otherwise assert on behalf of their child, do not discuss the merits of the tort claim itself (e.g.  do not discuss negligence, contributory negligence, comparative fault, or tort damages).  You may also assume that if the agreement is enforceable, it binds the father even though signed only by the mother.  

End of examination