SUBSET 2D: QUESTIONS ON INTERPRETATION · 2015. 10. 15. · 1 SUBSET 2D: QUESTIONS ON...

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SUBSET 2D: QUESTIONS ON INTERPRETATION

QUESTION 67

Ms. Arnstein was the sole proprietor of a retail sporting goods store. Mr. Benitez owned a wholesale

business in the same industry.

For 1998-2002, Arnstein had stocked primarily soccer equipment in her store. During that period, Benitez

had supplied all of her needs. Arnstein chose Benitez because his prices were the lowest. They had had five separate

written contracts. Each writing purported to require Benitez to supply Arnstein with a specified quantity of

equipment. In each year Arnstein had ordered more, and Benitez had filled ail the orders without protest.

In early 2003 Arnstein began reading that the "hot" new sport would be field hockey. For that reason, when

Arnstein and Benitez negotiated their 2003 agreement, Arnstein insisted that the writing refer to field hockey sticks

as well as soccer gear. Like the prior writings, the agreement specified a quantity for both soccer and field hockey

equipment. The writing was drafted by Benitez' attorney. The 20-page, detailed writing contained the following

clauses, inter alia:

"RECITAL: Arnstein is desirous of filling all her sporting goods needs, notably soccer equipment, during

2003.

CLAUSE #4: Benitez hereby promises to supply Arnstein's needs for field hockey sticks up to a maximum

of 200.

CLAUSE #7: The parties understand that this writing supersedes and renders nugatory any prior oral or

written agreements between the parties."

Arnstein and Benitez met on January 9, 2003 to review the agreement. Benitez explained that he had

offered Arnstein "such competitive prices" because he had been able to purchase all Arnstein's needs from Chang

Company, a sporting goods manufacturer. Benitez stated that he viewed their new contract as "risk" because he had

never dealt in field hockey equipment before. Arnstein told Benitez "not to worry. Hockey is a relatively new sport

in El Dorado, and my research indicates that at max–and I mean absolute max–I'll be ordering only those 200 sticks

from you." Benitez said that "nevertheless" he wanted "it understood that the deal is dependent on my being able to

get at least 75% of your orders from Chang. This isn't 'for public consumption'; I don't want my competitors to know

that I depend so heavily on Chang, but that's the only way I can offer you such fantastic savings." Arnstein said,

"OK."

They met again on January 10 to sign the writing. Before they signed, Benitez reminded Arnstein of the

understanding about Chang Company. On a separate piece of paper, he had written "75.0. %." Arnstein initialed the

piece of paper and then signed the contract.

In mid-January 2003, DANCING WITH THE STARS began. The star of the show was a professional field

hockey player, Laura Dalton. The show emphasized her hockey background. The popularity of hockey soared; by

February 10 Arnstein's customers ordered 700 sticks.

On February 15, Arnstein placed the order with Benitez. On March 20, Benitez contacted Chang Company

to order the 700 sticks. Chang informed Benitez that he could fill "only 74.5% of the order. Thanks to Dalton,

hockey orders have gone through the roof. If you'd called first thing in March, I might have been able to do it, but

now 74.5% is the best I can do."

Benitez tells Arnstein he cannot fill her order. ARNSTEIN SUES BENITEZ FOR DAMAGES FOR

MATERIAL BREACH OF CONTRACT. At trial, there is undisputed expert testimony that in contracts in this line

of business, (1) "it is not uncommon" to treat "maxima" or specifications of quantities as mere estimates; and (2)

numbers are "usually rounded" --75% would include anything in excess of 74.5%. WHO WILL PROBABLY

PREVAIL?

2

QUESTION 67

1 CONDITIONS

2 D wants to add a 75.0% condition

11 Theory #1: implied term

12 based on actual intent

13 no

14 knew it wasn't in writing

15 based on interpretative intent

16 unforeseen development

17 popularity of the sport

18 untoward, one-sided result

19 no

21 Theory #2: introduce the parol evidence

22 Question #1: integration

23 test finality

24 writing

25 detailed

26 20 pages

31 Question #2: complete integration

33 UCC

34 personal property

35 "would certainly"

41 prior oral understanding

42 +merger clause

43 "prior"

44 +detailed

45 +20 pages

46 -but not for public consumption

47 -not let competitors know

48 UCC bias in favor of partial

51 writing signed at the execution of the K

52 merger clause inapplicable

53 even stronger case for partial integration

61 Question #3: "exceptions"

62 consistent oral condition precedent to effectiveness of writing as K

63 "the deal is dependent on …."

64 only conditions to K formation

65 not operative during performance

66 here fairly early

71 if the condition is part of the contract, interpret

72 assume "75.0%"

81 Step #1: identify all the possible meanings

82 UCC

83 text–75.0

84 trade usage – "usually" rounded

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85 no course of dealing

86 no course of performance

87 at this point, court might say plain meaning – the decimal point

88 if not, two possible meanings, infra

91 Step #2: characterize each meaning as a type of usage

92 general: exactly 75.0

93 decimal point

94 limited: in excess of 74.5

95 existence

96 "usually"

97 impute

98 evidently an experienced industry member

99 mutual?

99.1 individual

101 Step #3: select a meaning

102 primary basis: order of preference

103 Williston

104 limited unless judge finds 75.0 to be plain meaning

105 Corbin

106 limited

111 secondary basis: maxims

112 contra proferentem

113 Benitez' attorney

114 now a last resort

121 if 75.0 a condition, what happened?

122 not fulfilled

123 74.5

124 excuse

125 prevention

126 delay

127 "If you'd called first thing in March"

128 wrongful

129 if excused, duty of immediate performance arises

131 scope of duty: supply all the needs?

132 interpretation

141 Step #1: identify all the meanings

142 UCC

143 text:

144 "maximum"

145 context

146 recital

147 "needs"

148 but "notably soccer"

149 trade usage

149.1 "not uncommon"

149.2 a bit weak

149.3 course of dealing

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149.4 five prior contracts

149.5 always ordered more

149.6 no objection

149.7 result: two meanings-true maximum or mere estimate


152 general

153 true maximum

154 limited

155 estimate

156 existence?

157 "not uncommon"

158 impute?

159 both longterm members of industry

159.1 mutual


161 Step #3: choose

162 primary basis: order of preference

163 Williston

164 limited

165 Corbin

166 mutual

171 secondary basis


173 Benitez' attorney

174 practical construction

175 later conduct

176 Benitez not object

181 if duty not performed

182 no discharge

183 unforeseeable event

184 popularity of field hockey

185 but not render performance impossible

186 breach

187 material breach?

188 important part of contract

189 in limine

189.1 early in the performance phase

5

QUESTION 68

Ms. Ambrose was the sole proprietor of a company that manufactured glass. Mr. Ballastra was the sole

proprietor of an artists' supply company. He purchased the company in December 2000. He had formerly been a

stock broker. The prior owner had dealt with Ms. Ambrose.

On January 10, 2001, Ambrose and Ballastra entered into a written contract drafted by Ballastra's attorney.

The writing contained the following clauses, inter alia:

–A clause reading "WHEREAS Ballastra seeks to secure a supply for all his customers' glass needs during

the next ten years and Ambrose is willing to expand her production capacity to meet those needs."

–#3. "Ambrose shall deliver, and Ballastra shall order, accept, and pay for, a minimum of 1,000 pounds of

glass during each month of this agreement."

–#5. "To satisfy this agreement, the glass delivered must strictly have the following composition: ... a

minimum of at least 15.0% lime …."

–#11. "Ballastra shall pay $4.00 a pound for clear glass and $6.00 a pound for colored glass."

–#12. "This writing supersedes all prior agreements between the parties and embodies their entire

agreement."

Just before they signed the writing, Ambrose told Ballastra that "since you're a newcomer to this industry,

you ought to realize that in this business, quantities and percentages in contracts are usually ballpark estimates. Is

that agreeable?" Ballastra nodded and then signed.

On February 1, Ballastra placed his initial order under the contract. On February 3, Ambrose filled the

order. Ballastra paid for the shipment and immediately made the glass available to his customers. Mr. Candide was

one of the first customers to purchase and use the glass. When he placed the glass in his kiln, the heat produced

excessive bubbles in the glass and ruined the art work. Candide complained to Ballastra.

On February 15, Ballastra took several samples of the Ambrose glass to a nearby analytical laboratory. The

laboratory reported that the samples contained only 14.9% lime and explained that deficient lime content can cause

glass to bubble when heated.

On February 20, Ballastra called Ambrose and informed her of the laboratory's findings. She stated that she

had always used" the same formula for all her customers and that "everyone else finds it perfectly satisfactory for art

work. Your predecessor did. So what if it's only 14.9% lime? I told you before we signed that in this business, things

like percentages are only approximations. I've lived up to my part of the bargain." Ballastra told Ambrose that he

had "some thinking to do about the deal."

On March 1, Ballastra received a visit from Ms. Dondero, a sales representative of Elite Plastics. She told

Ballastra that in February, her company had "just released a revolutionary new type of plastic which is a perfect

substitute for glass in art work. We even call it Plastic Glass." She told Ballastra that Elite charged $2.00 a pound for

clear art plastic and $3.00 a pound for colored art plastic.

On March 2, Ballastra phoned Ambrose. He informed her that after "thinking it over," he had decided that

he no longer needed any glass from her company.

Ambrose sues Ballastra for damages for material breach of contract. At trial, there is undisputed expert

testimony that: (1) in the national glass trade, it is the virtually universal understanding that quantities are estimates;

and (2) a slight majority of the members of the industry treat percentage figures such as "15%" as mere estimates.

CAN AMBROSE RECOVER? Do not discuss the measure of damages.

6

QUESTION 68

1 PAROL EVIDENCE RULE

2 Oral understanding

3 A said it

4 B nodded

5 question 1: integration?

6 Test finality

7 yes

11 question 2: complete integration?

12 PP transaction

13 UCC governs

14 test "certainly"

15 -merger clause

16 +no reference to contemporaneous

17 -refers to "prior"

18 -strained argument: before the writing

19 -"embodies"

19.1 difficult to satisfy the "certainly test"

19.2 partial integration

21 if partial, supplement

22 consistent additional term

23 if so, no breach

31 IMPLICATION

32 Implied promise to maintain requirements

33 implied-in-fact based on actual intent

34 PER analysis, supra

35 if excludable, not use as basis for implication

36 probably not

41 implied-in-fact based on interpretative intent

42 original status

43 "needs"

44 requirements contract

45 split of authority over implied promise

46 fairness, reliance

47 expand capacity

48 but can sell to third parties

51 later development

52 advent of Plastic Glass

53 unforeseeable?

54 "revolutionary"

55 effect on structure of bargain

56 drastic impact

57 here?

58 lopsided outcome?

61 INTERPRETATION OF QUANTITIES


63 text

64 "minimum"

65 context

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66 not "strictly"

67 not "at least"

68 trade usage

69 expert testimony


69.2 with prior owner

69.3 not this owner

69.4 conversation

69.5 probative of mutual usage

69.6 but not routinely under UCC

69. 7 result at this step: two possible meanings


72 general usage

73 minimum

74 trade usage

75 estimate

76 (1) existence

77 "virtually universal"

78 (2) impute to party

79 P is the one resisting

79.1 evidently longterm member of industry

79.2 conversation discloses actual knowledge

79.3 mutual usage

79.4 estimate

79.5 only if court admits the conversation

81 Step #3: choice

82 primary basis: order of preference among usages

83 Williston

84 trade usage

85 Corbin

86 same result

87 secondary basis: the canons or maxims


89 drafted by D's attorney

89.1 maxim used only as a last resort

91 INTERPRETATION OF PERCENTAGE


93 text

94 "15.0"

95 not just "15"

96 context

97 "strictly"

98 "at least"

99 especially strong

101 trade usage

102 expert testimony

103 mutual usage

104 course of dealing

105 prior owner

106 not this owner

107 conversation

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108 probative of mutual usage

109 but not routinely admissible under UCC

109.1 admit only if no plain after considering other sources

109.2 result: two meanings


112 popular usage

113 exactly 15%

114 trade usage

115 estimate

116 but relevant?

117 the trade usage relates to figures such as 15, not 15.0

118 (1) existence

119 only slight majority

119.1 (2) impute to D?

119.2 new owner

119.3 only one month

119.4 new to industry

119.5 but actual notice-conversation

119.6 mutual usage

119.7 only if court admits conversation

121 Step #3: choice

122 primary basis: order of preference among usages

123 Williston

124 strict standard for proving trade usage

125 perhaps select popular

126 Corbin

125 laxer standard for trade usage

126 perhaps trade usage

129 secondary basis: canons or maxims

129.1 contra proferentem

131 P'S CONDITION

132 interpretation of percentage

133 if failed, no duty of immediate performance

134 D'SDUTY

135 interpretation of quantity

136 breach?

137 if breach, material?

138 essential part of the bargain

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QUESTION 69

In 1997, the "Peruvian" style began taking El Dorado by storm. Leather clothing and furniture with

geometric designs from Peru became the rage in El Dorado. Mr. Asdrubale had inherited a large sum of money; and,

having heard of the popularity of the Peruvian style, he decided to make an investment to capitalize on the rage. Ms.

Bosch, a Peruvian native, had immigrated to the United States. She was the sole proprietor of Bosch Imports, which

sold goods primarily from Central and South America. Bosch Imports was headquartered in New York City.

In January 1998 the Morena Chamber of Commerce held a Peruvian style trade show to enable local

businesspersons to meet representatives of Peruvian companies and importers such as Ms. Bosch. On January 10,

Asdrubale and Bosch met at the show. She had on display several items of clothing and furniture, all imported from

Peru. Bosch explained to Asdrubale the geometric style features which had made Peruvian wares so attractive.

On January 15, as the trade show closed, Asdrubale and Bosch entered into two written contracts, which

were stapled together. Under the terms of the contracts, for a one year period Bosch promised to supply all of

Asdrubale's requirements for "Peruvian style" merchandise. Both contracts named "John Asdrubale" and "Michelle

Bosch, proprietor of Bosch Imports," as parties. In addition, both contracts described "the Peruvian style" in roughly

the same manner as Bosch had orally described it to Asdrubale. Furthermore, the contracts specified the dimensions

of the furniture and clothing. Finally, both contracts included clauses providing that the writing "supersedes any

prior or contemporaneous oral understanding between the parties."

One contract dealt with "Peruvian style" clothing, the other with "Peruvian style" furniture. The first

contract required Bosch to provide a Peruvian certificate of origin for every shipment under the contract. The second

contract was silent on the subject. However, just before he signed, Asdrubale referred to "certificates for the

furniture and clothes." Bosch nodded and said only, "Sure."

For the first three months of the contract, Bosch supplied only clothing and furniture manufactured in Peru.

However, the Peruvian style became so popular nationwide that several American companies began manufacturing

furniture in the same style. Bosch discovered that she could save money by providing Asdrubale with Peruvian style

furniture originating in the Carolinas. At first, Asdrubale did not notice the difference; for two months he accepted

the furniture, paid for it, and once complimented Bosch that "the latest shipments have been even better than the

early shipments." However, in the sixth month a customer called Asdrubale's attention to the fact that all the

furniture items in his store had tags indicating North Carolina manufacture. The customer not only complained to

Asdrubale; she also wrote to the local paper. The paper ran a story with the headline, "Asdrubale Selling Peruvian

Furniture-From North Carolina!" Asdrubale's sales plummeted. He then attempted to revoke his acceptance. He

refused to pay for the furniture already delivered and to take any additional shipments from Carolina.

BOSCH SUES ASDRUBALE FOR DAMAGES FOR BREACH OF CONTRACT For purposes of trial,

the parties stipulate that: The rejected furniture met the description of the geometric Peruvian style and all dimension

specifications set out in the contracts; when Asdrubale and Bosch signed their contract, almost 100% of the

"Peruvian style" goods for sale in El Dorado, including those on display at the trade show, were of Peruvian origin;

but even at that time nationwide 60% of the goods advertised in that manner did not originate in Peru. IF THERE IS

A BREACH, IS IT MATERIAL?

10

QUESTION 69

1 DUTY TO PAY

11 CONDITIONS

12 #1: deliver furniture

13 express?

14 no quotation

15 constructive

16 part of the bargain

21 what happened to condition #1

22 fulfilled

23 met the specifications

24 stipulation

31 #2: originate in Peru

32 not an express provision of the second contract

33 nevertheless a term?

41 THEORY #1: INCORPORATION BY REFERENCE

42 an express provision in the first contract

43 executed at same time

44 stapled together

45 requirement #1: reference

46 no reference to the other writing

47 requirement #2: intent to incorporate

48 no facts indicating such an intent

49 ergo, D win under this theory

51 THEORY #2: SUPPLEMENT WITH CONSISTENT ADDITIONAL TERM

52 parol evidence rule

53 P referred to "certificates for the furniture and the clothes"

54 D said, "Sure"

55 express agreement

61 threshold question: an integration at all?

62 final embodiment of any part of the contract

63 probably yes

71 next question: complete or partial integration?

72 split of authority at common law

73 but this a personal property contract

74 ergo. UCC govern

75 2-202

76 text ambiguous

77 but Comment announce test

78 whether reasonable parties would certainly

79 somewhat like Williston test

79.1 objective standard

79.2 but "certainly" rather than "normally"

79.3 bias against finding complete integration

81 apply to the facts

82 merger clause

83 cut in favor of complete

84 Williston find complete

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85 but again "certainly" rather than "normally"

86 ergo, probably partial integration

87 P probably prevail on this theory

91 THEORY #3: INTERPRETATION

92 "Peruvian style"

101 Step #1: identify all the possible meanings

102 if only text and context: geometric design

103 text uses the expression "Peruvian style"

104 context–dimension specifications

111 not limited to the four corners

112 again, UCC control

113 2-202

114 (1) trade usage

115 all the furniture at the show

116 all the furniture advertised for sale in the state

117 (2) mutual usage–course of dealing

118 no prior dealings between P and D

119 (3) mutual usage–course of performance

119.1 earlier accepted furniture manufactured in Carolinas

119.2 but unaware originated in Carolinas

121 mutual usage–statements at time of execution of contract

122 not under the Code

123 only if trial judge finds ambiguous

124 if judge finds ambiguous can consult the extrinsic evidence

125 "Peruvian"

126 arguably ambiguous

127 geographic connotation

131 Step #2: characterize each potential meaning as a type of usage

132 popular

133 perhaps geographic connotation

134 limited

135 –geographic

136 all the goods at the show

137 all the goods in the state

138 but not nationally

141 –trade

142 (1) existence

143 not nationally

144 in the state

145 (2) impute

146 P just joined the trade

147 more difficult to impute national usage to him

151 –mutual

152 P made statement

153 put D on notice

155 D said, "Sure"

155 –individual usages

156 P

157 D

161 Step #3: choose

162 primary basis of choice: order of preference among the usages

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163 Williston

164 perhaps find only a popular meaning

165 high standard for trade usage

166 mutual only if reflected on face of writing

167 Corbin

168 mutual

171 secondary basis of choice: maxims

172 part of the same transaction

173 executed at the same time as clothing contract

174 favors P

175 practical construction

176 subsequent conduct

177 but P did not realize from Carolinas

178 maxim inapplicable

179 express unius est exclusio alterius

179.1 in one contract but not the other

179.2 favors D

181 if needn't be of Peruvian origin, fulfilled condition

182 if need be of Peruvian origin, excuse?

183 substantial performance

184 –subjective element

185 intentional

186 to cut cost

187 –objective element

188 complimented

189 "even better"

189.1 but customer reaction

189.2 in any event, only constructive conditions

189.3 an express condition?

191 D under duty of immediate performance

192 no discharge

193 no performance

194 ergo, breach


202 not in limine

203 perhaps even in good faith

204 however, the quid pro quo for P

205 money for the furniture

206 probably material

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QUESTION 70

Ms. Albion was the sole proprietor of a company that manufactures salad dressings and sells the dressings

to wholesalers. Mr. Berton owns a company that purchases food products manufactured by others and sells the

products wholesale.

Both Albion and Berton are members of the Salad Dressing Producers and Wholesalers Association

(SDPWA), including 67% of the American producers and wholesalers. Berton joined in 1995, but Albion has been a

member only since December 1998. The SDPWA promulgates industry standards. Standard 3.2 provides that when

a contract specifies a percentage content, "unless a contrary intent is manifested, the actual value shall be rounded

off to the closer whole digit. Thus, 19.51 would be rounded up to 20, and 20.49 would be rounded down to 20."

Albion and Berton had dealt with each other between 1996 and 1998. During that period, they had three

contracts for ranch salad dressing. The contracts specified that the dressing Albion delivered had to have "at least

15% sodium content," as certified by Castro Testing Laboratory. On several occasions under each contract, the

delivery has 14.9% sodium content, Castro Laboratory certified that content, and Berton made no objection about

the shipment.

In early January 1999, Berton obtained a large contract to provide Balsamic vinaigrette salad dressing to

Healthy Choice Meals. In turn, he wanted to purchase the dressing from Albion. On January 3, he phoned Albion,

described his contract with Healthy Choice Meals, and added that "I guess we can have the same basic deal we've

cut in the past."

On January 10, Albion visited Berton's headquarters to sign a detailed, lengthy contract drafted by Berton's

attorney. The contract began with a number of recitals, including a statement that both parties are members of

SDPWA. The recital noted that SDPWA "has promulgated several standards relevant to agreements between its

members." Another recital noted that Berton was entering the instant contract to assure a supply for his contract with

Healthy Choice Meals. (That contract made it clear that dressing with even 12.01% sodium was unacceptable.) The

same recital pointed out that Healthy Choice Meals "is committed to supplying its customers with products without

excessive amounts of ingredients such as sodium and fat." Clause 2 of the writing stated that for a three year period,

Albion agreed to supply Berton's requirements for Balsamic vinaigrette dressing. Clause 3 added that the dressing

Albion delivered could have "no more than 12.0% sodium, as strictly certified by Castro Testing Laboratory."

Clause 4 referred to two other ingredients of the recipe and described those contents respectively as "3%" and "2%."

Finally, the writing included a clause stating that the writing "represents the parties' entire agreement and supersedes

any prior or contemporaneous oral or written promises or agreements."

Albion did not bother to read the writing. However, before signing, she asked: "Again, this is basically our

old deal but for Balsamic vinaigrette. Right?" Berton nodded.

On February 1, Albion made the first delivery to Berton under the contract. When Castro Laboratory

analyzed the delivery, it found that the sodium content was 12.3%. Berton phoned Healthy Choice Meals and was

told that that high a level of sodium was unacceptable. Berton then phoned Albion. He told her that he would keep

the shipment "because I can probably sell it to someone other than Healthy Choice. However, read your contract.

12% means no more than 12.0%, not 12.3%. Period. End of sentence." Albion remained silent.

On February 10, Albion made the second delivery. When Castro certified that the sodium content was

12.2%, Berton rejected the shipment. Albion sues Berton on the contract for damages for breach. CAN SHE

RECOVER? DO NOT DISCUSS THE MEASURE OF DAMAGES.

14

QUESTION 70

1 INCORPORATION

2 STANDARD 3.2

3 existence?

4 yes

5 intent to incorporate?

6 reference that SDPWA members

7 reference to standards

8 "relevant"

9 but ambiguous

9.1 even if, "unless a contrary intent"

11 HEALTHY CHOICE CONTRACT

12 existence?

13 yes

14 intent to incorporate?

15 –D hadn't seen

16 +reference

17 +whole purpose to assure supply for that K.

18 common sense

21 IMPLICATION

22 types

23 interpretative intent

24 no unforeseen development

25 actual intent

26 both industry members

27 67%

28 again even if, "unless a contrary intent"

31 PAROL EVIDENCE RULE

32 early January: "same basic"

33 January 10: "Again basically our old"

34 three years

35 three contracts

36 several occasions under each K

37 14.9%–15%

41 integration?

42 test–finality for even part

43 yes

51 complete integration?

52 UCC governs

53 test "certainly"

54 +lengthy

55 +detailed

56 +merger clause

57 but "certainly" tough standard

58 ergo, partial

59 even if partial, only supplement

59.1 "contradict"?

61 INTERPRETATION

62 STEP 1: IDENTIFY ALL POSSIBLE MEANINGS

63 text

64 "12.0"

65 context

66 "strictly"

15

67 "2"

68 "3"

69 reference to the HC contract

71 limited usage

72 automatically consider under UCC

73 existence?

74 67%

75 impute?

75 one only member since Dec. 1998

77 but Berton since 1995

78 Berton disputing

81 mutual usage

82 certain types automatically admissible under UCC

83 course of dealing

84 three contracts

85 three years

86 several times

87 course of performance

88 +shipment #1

89 +accepted

89.1 -but protest

91 conversations

92 not the right type under UCC

93 thus, only if ambiguous

94 ambiguous here?

101 outcome here: two meanings

102 narrow: exactly 12.0

103 broad: round up or down

111 STEP 2: CHARACTERIZE EACH MEANING AS USAGE TYPE

112 general?

113 exactly 12.0

114 limited?

115 broad meaning

116 mutual?

117 broad

121 STEP 3: CHOOSE A MEANING

122 PRIMARY BASIS: ORDER OF PREFERENCE

123 UCC silent

124 Corbin

125 mutual

126 broad

127 Williston

128 limited

129 broad

129.1 grudgingly

131 SECONDARY BASIS: MAXIMS

132 "practical construction"

133 subsequent conduct

134 +shipment #1

135 +accepted

136 -but protest


138 Berton's attorney

16

141 assume the narrow meaning

142 failure of condition

143 no evident excuse

144 no duty of immediate performance

151 assume the broad meaning

152 shipment #1 and #2

153 fulfilled

154 later shipments

155 failed

156 but prospective non-performance

157 D refused to accept

158 duty of immediate performance

159 no evident discharge

159.1 ergo, breach

17

QUESTION 71

Ms. Asdrubale had resided in Wyoming before moving to El Dorado While she lived in Wyoming, she ran

a very large retail equestrian ("tack") store for ten years. She catered primarily to wealthy clientele. Mr. Bayamo had

been her supplier for saddle soap Bayamo always filled Asdrubale's orders by shipping her the most expensive

brands of saddle soap (suitable for the most expensive Argentine and British saddles with the finest leather). On

most occasions, he shipped her either Ye Olde Saddle Soap or Old Fashioned Saddle Soap. They were the two best

known brands of saddle soap. Bayamo had to pay $5.00 wholesale for each bottle of the soap which he, in turn, sold

to Asdrubale.

In late 1995, Asdrubale decided to move to El Dorado. Before doing so, she obtained a market survey of El

Dorado. The survey stated that if she opened the same size business in Morena and again catered to wealthy

clientele, she could expect the same level of sales and profits, including sales and profits for saddle soap. Based on

the report, Asdrubale moved to El Dorado in early January 1996. She called her new store "The Traditional

Saddlery."

Before opening the new store, on January 15, 1996 Asdrubale entered into a written contract with Bayamo.

The writing, prepared by Bayamo's attorney, contained several recitals of fact. The first referred to "Michelle

Asdrubale, doing business as THE TRADITIONAL SADDLERY." Recital #2 stated that both parties were members

of the American Tack Store Association (ATSA). Recital #3 added that the two had had "a long, mutually profitable

relationship'' and desired "to continue the same basic relationship" in the future. Recital #5 read that Bayamo

understood mat Asdrubale was opening a new business "to sell, inter alia, the high grade Argentine and British

saddles which she had vended in the past in Wyoming." The text of paragraph three stated that Bayamo would fill

Asdrubale's requirements for "tested, high quality saddle soap, such as Ye Olde Saddle Soap and Old Fashioned

Saddle Soap." Paragraph six stated that the soap had to be suitable "for high grade saddles." Paragraph ten provided

that the writing "represents the parties" entire agreement and supersedes any prior written or oral understandings

between the parties."

When Asdrubale and Bayamo met to sign the writing, they had an oral conversation. He stated that her

''timing was great because there are a lot of new products coming on the market. In particular, there have been some

startling advances in saddle soap chemistry." He assured her that she would "like the new stuff." Asdrubale

responded, "I might, but just remember my new name, 'The Traditional Saddlery.' I chose that name for a reason. In

this line of business, there's a lot to a name. I like the tested, tried, and true." They then signed the writing.

In late January, Bayamo learned about a new saddle soap, New Age Soap. It had essentially the same

chemical composition as Ole Fashioned Saddle Soap; but because it was produced by a different manufacturing

process, it cost Bayamo only $2.00 per bottle. After testing, ATSA had given it the same quality rating as Ye Olde

Saddle Soap and Old Fashioned Saddle Soap. However, New Age soap had virtually no name recognition outside

Virginia.

On February 1, Asdrubale placed a large order for saddle soap. On February 10, Bayamo shipped

Asdrubale five crates of bottles of New Age soap. Asdrubale unloaded the crates without noticing the labels. On

February 15th, a customer complained to Asdrubale that she, Asdrubale, did not carry any "really traditional" soaps.

The customer told Asdrubale that "it would be nuts to risk an expensive saddle with some new fangled product."

Asdrubale phoned Bayamo and demanded that he replace the shipment with Ye Olde or Old Fashioned

soap. He refused to do so. Asdrubale sues Bayamo for breach of contract.

18

QUESTION 71

1 the existence of a duty to provide traditional soap

11 argument #1: oral promise

13 P "tried and true"

12 D not object

14 before signature of writing

21 question #1: integration

22 test finality

23 detailed

24 obviously some provisions final

31 question #2: complete integration

32 general test completeness

33 specifically UCC test govern

34 saddle soap personalty

35 UCC in effect in El Dorado

36 the UCC test

37 text ambiguous

38 but Comment "certainly"

39 like Williston objective

39.1 but difficult to find complete

41 application of the UCC test

42 merger clause

43 but no reference to "contemporaneous"

44 same subject-matter

45 but "certainly"

46 probably a partial integration

47 ergo supplement the writing

51 argument #2: implied promise

52 reference to prior relationship

53 continue the same basic relationship

54 prior practice

55 "always" most expensive brands

56 but "most occasions" Ye Olde or Old Fashioned

61 argument #3: express promise

62 the text "tested"

71 step #1: identify all the possible meanings

72 intrinsic aids: context

73 reference to ATSA

74 name "TRADITIONAL"

75 "continue the same basic relationship"

76 "most occasions"

81 extrinsic aids

82 UCC govern

83 automatically consider "usage of trade"

84 ATSA

85 "course of dealing"

86 prior dealing

87 "course of performance"

88 none here

89 but not the oral conversation

19

89.1 different type of evidence of mutual

91 moreover, even Williston permit if ambiguous

92 "tested"

93 probably ambiguous

94 therefore, consider conversation as well

101 step #2: characterize each usage

102 general

103 probably D's meaning

104 in fact tested

105 limited usage

106 ATSA

107 (1) usage exists

108 (2) impute–both members

109 mentioned in writing

111 mutual usage

112 P's meaning

113 P said it

114 before signing

115 D did not object

116 individual usage

117 P had in mind

118 D on notice

121 step #3: primary basis of choice-order of preference among usages

122 UCC not prescribe

123 Williston


125 here equivocal

126 probably choose business usage

127 Corbin

128 prefer mutual

129 the meaning P urges

131 step #4: second basis of choice-the canons or maxims


133 Bayamo's attorney

134 but modernly a last resort

135 if rely on, resolve against D

136 ejusdem generis

137 "such as"

138 same chemical composition

139 same quality rating

139.1 but new

139.2 little recognition outside Virginia

141 duty of immediate performance?

142 conditions

143 implied condition: place order

144 fulfilled re first installment

145 placed order

146 future installments

147 no orders

148 but prospective non-performance of conditioned duty


152 perhaps innocent misunderstanding

20

153 +in -1 fmine.

154 early in the contract

155 some jurisdictions automatically material

156 term here?

157 +important in an economic sense

158 cater to wealthy clientele

159 market survey

159.1 customer's remark

159.2 little name recognition outside Virginia

21

QUESTION 72

For 10 years, Mr. Ariola owned a company that published materials for continuing education organizations.

He had worked almost exclusively with small continuing legal education (CLE) organizations. For the past five

years, he had hired Mr. Bertilion's printing plant to actually produce the materials. The largest order had been for

only 100 copies. Both businesses were located in the City of Morena.

Ariola and Bertilion had developed a standard form for their contracts for CLE materials. The writing

contained a clause stating that the writing "supersedes all prior understandings between the parties." Another clause

had a blank for "Quantity" just before "number of sets of materials." Ariola and Bertilion filled in the blank on each

contract. Still another provision, the delivery schedule clause, included the word "estimated;" but that word did not

appear in the quantity clause. During the performance of slightly less than a majority of their CLE contracts, Ariola

had ultimately ordered fewer sets of materials than originally specified in the writing; and Bertilion had neither sued

Ariola for breach of any of those contracts nor even mentioned the possibility of a suit.

In early 1993, Ariola decided to begin publishing materials for continuing medical education (CME)

organizations. On January 101 1993, he discussed a contract with Bertilion to publish materials for the March 1st

meeting of the El Dorado A.M.A. chapter. They used their standard form, lined out "legal," and wrote in "medical."

Just before inserting the quantity figure, Ariola said that he was "a bit worried, since I don't have any CME

experience. I hate to pin myself down." Bertilion responded, "I guess life is just full of risks. I need a hard number.

Stick your neck out." At that point, Ariola wrote in "1,000." The agreement constituted a valid and enforceable

contract.

On February 1, 1993, Ariola spoke with Dr. Carroll, the A.M.A. chapter president. She informed Ariola

that early registration was "way down" and that she would probably need only 500 copies of the materials. Later that

day Ariola phoned Bertilion to order 500 copies. Bertilion reminded him that the writing called for 1,000 copies.

Ariola responded that he was " fully aware of what the contract calls for, but hopefully registration will pick up

before the deadline."

On February 15, Carroll told Ariola that the "final" registration figure was 520 attendees. Ariola

immediately phoned Bertilion and attempted to place a "final order" for 520 sets. Ariola said that he expected

Bertilion to be "as flexible" as Bertilion had been "in the past." Bertilion stated that "this was the big time now, and

a promise is a promise." Ariola said, "The deal is off."

BERTILION SUES ARIOLA. DOES BERTILION HAVE A CAUSE OF ACTION FOR BREACH? IF

SO, IS THE BREACH MAJOR OR MINOR?

The case comes to trial today. At trial, Ariola offers testimony by the president of the El Dorado Publishers

Association. She testifies that "for the past few years, it's been a custom in our industry to regard quantity figures as

ballpark numbers. The really experienced people in the industry know that the final number is sort of a moving

target."

22

QUESTION 72

1 extrinsic evidence of oral conversation

2 "pin"

3 "hard"

4 "risks"

5 "stick"

6 supplement

11 parol evidence rule

12 question #1: integration?

13 final embodiment of part?

14 writing

15 clause

16 yes

21 question #2: complete integration?

22 Wigmore

23 subject matter

24 quantity

25 therefore complete

26 Williston

27 hypothetical, reasonable parties

28 seemingly complete

29 clause

29.1 but only "prior"

29.2 here contemporaneous

29.3 still probably complete

31 Corbin

32 subjective intent

33 perhaps partial

34 UCC

35 objective standard like Williston

36 but Comment: "certainly"

37 govern here?

38 deliver merchandise

39 but printing service

41 even if complete, may admit extrinsic to interpret


54 ------objective approach

44 text

45 a number

46 seemingly a plain meaning

47 context

48 "estimated"

49 no comparable language in this term 59.1

49.1 therefore, 1,000

51 ------modified objective approach

52 generally follow objective approach

53 exception: admit trade usage as matter of course

54 president

55 "our"

56 state

57 but here city

58 "industry"

59 all publishing

59.1 but here CLE

59.2 perhaps a mere estimate

23

61 -----UCC

62 follow objective approach with exceptions

63 an exception for trade usage

64 supra

65 an exception for course of dealing

66 earlier contracts

67 but different size

68 but CLE

69 an exception for course of performance

69.1 here?

69.2 a mere estimate?

71 -----subjective

72 any relevant evidence

73 a mere estimate

81 step #2: classify each meaning as a type of usage

82 general

83 1,000

84 trade

85 supra

86 mutual

87 prior contracts

88 but some differences

89 conversation

89.1 "pin"

89.2 "risks"

89.3 "hard"

89.4 "stick"

89.5 individual

91 step #3: primary basis of choice

92 order of preference among types of usage

93 Williston

94 what result?

95 Corbin

96 what result?

97 secondary basis

98 canons or maxims of interpretation

99 any result on these facts?

101 duty to pay

102 condition

103 deliver

104 failed

105 prospective non-performance of the conditioned duty

106 "off


112 not performed

113 no evident discharge doctrine

114 still possible to perform

115 financial impracticability?

116 not extreme enough

117 therefore breach

121 major or minor breach?

122 extent P already received performance?

123 nothing

124 probability P will receive performance?

125 "off"

126 character of the breach?

24

127 intentional

128 forfeiture by D

129 none: not incurred expense yet

129.1 therefore material

25

QUESTION 73

For 20 years, Ms. Elise Abbott had owned the Abbott Horse Ranch in a suburb just outside Morena. She

resided in the Midwest until mid–1990, and she employed her cousin, Frank Abbott, as the manager. Frank had

always purchased the ranch's supplies from Belindez Feed and Grain, owned by Jorge Belindez.

When Frank retired, Elise moved to El Dorado to take over the ranch in early December 1990. Before

leaving town in late December, Frank reminded Elise to buy the next six months' supply of feed from Belindez in

January 1991.

On January 2, 1991, Elise visited Belindez' office. During an oral conversation, Abbott told Belindez that

Frank had told her "almost everything she needed to know" about running the ranch. She said that she stopped by to

"buy all" the feed she would "need during the first half of the year." Belindez assured her that he would fill her

"requirements." He stated that he "promised" her that he would "recognize and observe" all the practices "normal for

the business." Belindez added that based on past experience, he would "estimate" Ms. Abbott's horses would

"probably" consume 80 tons before the end of June.

On January 3, Abbott and Belindez entered into a valid, enforceable written contract. A recital in the

writing referred to their prior dealings and stated that the parties were entering into "another agreement to meet the

Abbott Horse Ranch's feed needs." The writing stated a quantity of "80.0 tons" and specified a price of "$100.00 per

ton." The writing stated that Abbott could order up to five tons at a time and that Belindez would deliver the order

within "approximately" 48 hours. Abbott was to pay within "roughly" 72 hours. The writing stated that it

"superseded all prior oral agreements between the parties."

When Abbott and Belindez signed the writing, there was a widespread custom in the ranching business in

the Morena area; the custom was that quantities specified in feed supply contracts were treated as estimates and that

the quantity was the actual amount needed. Almost all the local ranchers knew the custom. Frank was familiar with

the custom, but Elise was unaware of it.

By May 30, the Abbott Ranch had used and paid for 80 tons of feed. By that date, the price of feed had

fallen to $70 per ton. On June 1, when Belindez happened to drive by the ranch, he noticed that the stack of feed was

gone. He went to his office, had three trucks loaded with a total of 10 tons of feed, and called Abbott. He informed

her that he would deliver the feed at the "agreed upon price." She refused to pay for any more feed at that price; she

said that she considered herself free to buy any feed in excess of 80 tons on the open market at the best price.

Belindez angrily told her that he didn't appreciate "being stabbed in the back" after having worked so closely with

Abbott Ranch for years.

Later the same day, Belindez heard that a fire at Chang Stables had destroyed its feed. He phoned Dennis

Chang, the stable owner. Belindez told Chang that he had three trucks already loaded with feed, ready to deliver.

Given the emergency and the high quality of Belindez' feed, Chang paid Belindez $100 per ton. The three truckloads

would have met Abbott Ranch's needs during June. Since Chang's stable was farther away than Abbott's, Belindez

incurred an additional $300 in hotel and meal expenses for the truckers who made the delivery.

BELINDEZ SUES MS. ABBOTT FOR DAMAGES FOR BREACH OF CONTRACT. CAN HE

RECOVER? IF SO, WHAT WOULD BE HIS MEASURE OF RECOVERY?

26

QUESTION 73

1 what was the scope of D's duty

11 only an estimate

12 implication

13 custom's existence

14 "widespread"

15 "almost all"

21 Intent to incorporate

22 Belindez

23 "recognize"

24 "observe"

25 "all the practices normal"

26 Abbott

27 she not make similar statement

unaware

28 new to business

31 express promise by her

32 oral promise by her

33 hers statements

34 "buy all"

35 "need"

36 his statements

37 "requirements"

38 she evidently did not disagree

41 Question #1: integration

42 test

43 here yes

44 especially given merger clause

51 Question #2: complete or partial

52 Wigmore

52 subject-matter

54 Williston

55 naturally, normally

56 Corbin

57 subjective intent

58 but this personalty K

59 UCC governs

59.1 test

59.2 objective

59.3 but "certainly"

61 facts Here

62 true merger clause

63 but certainly?

71 even if partial, cannot contradict

72 here

73 interpretation infra

81 interpretation of "80,0 tons"


83 objective approach

84 turn to extrinsic only if no plain meaning

27

85 text 80.00 seems exact

86 context

87 +100.00

88 "approximately"

89.1 "roughly"

89.2 contrast

89.3 "needs"

91 compromise

92 generally follow objective approach

93 but exception for trade custom

94 relevant here

101 subjective

102 prior oral statements

103 hers

104 "all"

105 "need"

106 his

107 "requirements"

108 "estimate"

109 "probably"

111 step #2: classify each meaning as a type of usage

112 popular

113 dictionary

114 numbers

115 yes

116 limited, trade

117 exists

118 "widespread"

119.1 "almost all

119.2 pertinent r

119.2 +both in business

119.2 -one new to business

119.3 +Frank told her "almost everything"

121 mutual

122 difficult

123 individual

124 Abbott

125 Belindez

126 "almost everything"

127 basis to prefer

131 Step #3: choice, order of preference

132 Williston

133 custom

134 Corbin

135 custom

136 individual?

141 conditions to activating duties

142 promise to deliver

143 constructive condition

144 alternating promissory conditions

145 fulfilled

146 made the prior deliveries

147 remaining delivery

148 prospective non-performance of the conditioned duty

28

151 therefore duty of immediate performance

152 not performed

153 no discharge doctrine applicable


161 damages

162 general

163 hypothetical measure

164 K price versus market price

165 but actual resale

166 able to resell at K price

167 successful mitigation

168 cumulative or exclusive

169 split of authority

171 specials

172 additional $300

173 award X to vindicate expectation interest

29

QUESTION 74

Ms. Azevedo owned a construction materials supply store in Fargo, North Dakota. She had operated the

store profitably for 10 years. In 1990, a physician advised her to more to a warmer area for her health. She chose

Morena for two reasons. First, she knew numerous members of the El Dorado construction trade. Second, with the

exception of climate, Morena was similar to Fargo; it was roughly the same geographic size, and it had

approximately the same size population and demographics.

In early 1991, she contacted Mr. Belindez, a general contractor in Morena. She said that although she knew

"a lot" of people in El Dorado, she had "just moved" there, She explained mat she was "on a very tight budget" but

wanted a store "just like" the one in Fargo. She gave him a copy of the blueprints for the Fargo store. After viewing

the blueprints. Belindez said that the roof would require "3,000 tiles." On January 10, 1991, they signed a written

contract for the construction of a new store in Morena. Clause #3 of the contract stated that by July 20, 1991,

Belindez would complete construction of a building complying with the blueprints on a site Azevedo had already

purchased. Clause #4 provided mat Belindez would supply "adequate roofing materials, including three thousand"

tiles. (In Morena, there was a widespread practice in the construction industry: The expression, "a thousand" tiles,

meant two truckloads of a certain size. At least 80% of the general and subcontractors in Morena were aware of the

practice.) Clause #15 staled that Azevedo would pay Belindez "exactly $130,000" on July 21, 1991. Clause #17 read

that the writing "includes the parties' entire agreement and supersedes any prior oral agreements."

Azevedo and Belindez spoke just before signing the writing. Azevedo said mat she was having second

thoughts and should be entitled to "an even better" deal, since there was so little work for contractors such as

Belindez. Belindez said that he could agree to "a $5,000 refund if the Index of Construction Cost, prepared by the £1

Dorado Commerce Department, declined at least 5% by June 30th." Azevedo suggested adding that term to the

writing. Belindez explained that he preferred keeping the agreement oral, since he did not want his competitors to

know he was offering such favorable terms. The two then shook hands and signed the writing.

Performance proceeded smoothly until late May when work began on the root Belindez delivered six

truckloads of tile to the site. (The six truckloads contained a total of 2,000 tiles.) Because of the peculiar roof design,

another thousand were needed. Azevedo demanded that Belindez furnish the additional tiles. When he refused, she

fired him. She then hired another contractor, Mr. Cameron, He completed job by September 20th for $140,000.

AZEVEDO SUES BELINDEZ FOR BREACH OF CONTRACT. IS SHE ENTITLED TO RECOVER?

WHAT WOULD BE HER MEASURE OF RECOVER? The Index declined 6% by June 30th. At trial, Azevedo

offers an accountant's uncontradicted testimony that her old store averaged $10,000 in monthly profits and that in

even the first few months of operation the new store averaged a $10,000 monthly profit The monthly fair rental

value of the property was $2,000.

30

QUESTION 74

1 duty to furnish tiles

2 scope of duty

3 P

4 adequate

5 OR 3,000

6 D

7 certain size truckload

11 IDENTIFY ALL THE POSSIBLE MEANINGS

12 objective approach

13 turn to extrinsic only if no plain meaning

14 text

15 3,000

16 if anything plain, numbers

17 context #1

18 "adequate"

19 "including"

19.1 NOT say "limited to"

19.2 context #2

19.3 "exactly"

19.4 cut in favor of finding precise number.

21 compromise approach

22 consider limited usage even if plain meaning

23 trade usage here

31 subjective approach

32 any meaning the language can reasonably bear

33 even numbers

34 precedents equating numbers with size

35 apply here

41 possible meanings

42 exactly 3,000

43 whatever necessary

44 happens to be 3,000

45 certain number of truckloads of certain size

51 CLASSIFY MEANING MEANING AS A TYPE OF USAGE

52 popular

53 3,000

54 limited

55 (1) existence

56 in construction in Morena

57 80%

58 (2) P on notice

59 -not member of construction trade

59.1 -"just moved"

59.2 -evidently did not know

59.3 +so widespread

59.4 +in construction supply business

59.5 +knew "a lot"

59.6 -in El Dorado, not specifically in Morena

61 mutual-exactly 3,000

62 P had that in mind

63 "tight" budget

64 in fact "very tight"

31

65 therefore D knew that P could not afford to ballpark

66 individual usage-exactly 3,000

67 perhaps D did not subjectively realize

68 but D should have known

69 "tight"

69.1 "very tight"

71 CHOOSE A MEANING

72 Corbin

73 if a mutual usage, choose that

74 if not, then limited usage

75 Williston

76 mutual usage only if reflected on face of writing

77 grudgingly then limited usage

78 otherwise popular

81 conditions to be fulfilled by P

82 #1: access

83 partially fulfilled-initially

84 later ordered off site

85 fail or excuse

86 propective non-performance

87 D refused to deliver the balance of the file

91 #2: payment

92 never made

93 fail or excuse

94 prospective non-performance

95 D refused to deliver the balance of the file

101 D's duty

102 not performed

103 breach or discharge

104 no facts triggering a discharge doctrine

105 material breach?

106 intentional

107 in some jurisdictions automatically

108 the roof important

111 damage

112 DAMAGES FOR FAILURE TO COMPLETE CONSTRUCTION

113 normal formula: contract price versus cost of new contractor

114 140,000 new contractor

115 original contract price 130,000

116 but refund could reduce price to 125,000

121 parol evidence problem

122 question #1: integration?

123 merger clause

124 definitely

131 question #2: complete or partial integration?

132 Williston

133 merger clause

134 but peculiar wording

135 "prior"

136 not say

137 reached this agreement after writing prepared

138 roughly contemporaneous

139 moreover, naturally or normally test

139.1 stated reason for not reducing to writing

32

139.2 reason plausible

139.3 Corbin

139.4 subjective intent

139.5 little weight to merger clause

141 if promise part of contract, entitled to refund

142 refund reduce K price to 125,000

143 15,000 for that element of damage

151 DAMAGES FOR DELAY

152 profits

153 -certainty principle

154 -new business

155 -some courts never

161 but even under the traditional view

162 amount of damage as well as the fact of damage

163 BUT +old store 10 years

164 +virtually identical store

165 +same size population

166 +same demographics

167 +track record

168 +expert accountant

169 +uncontradicted

169.1 plus $10,000 for each month of delay

169.2 two months

171 emerging view

172 only the fact of damage, not the amount

173 easier to recover

181 even if deny profits, not preclude all recovery

182 not "all or nothing"

183 rental value

184 $2,000

185 two months

33

QUESTION 75

For years Hr. Asdrubale owned a hockey team. However, he was frustrated with the game of hockey

because, in his words, "the rules permit games to end in ties, and I hate ties." In 1984, he sold his hockey team and

bought the Morena Eagles, an American Baseball League team.

Jake Bishop was the Eagles' star player. Jake was a poor fielder; he led the team in errors the past two

years. However, in both years he came close to winning the A.B.L. batting title.

In January 1985, Asdrubale held a meeting with all the players. At the meeting, he described his "personal

philosophy of excellence. I worked hard to become the biggest real estate developer in El Dorado -- number one by

a wide margin." He declared that he wanted to bring the same philosophy of excellence to the Eagles: "In

commercial realty, I'm the best. I don't settle for ties in business, and as a team we're not going to settle for the ties.

As individuals, you players are going to be the best." He added that to create incentives to achieve that goal, all

contracts were going to be revised to lower base pay but include large "philosophy of excellence" bonuses.

In February, with Bishop's consent, Asdrubale's lawyer rewrote Bishop's contract. Bishop's base pay was

reduced; but the new contract provided:

"PHILOSOPHY OF EXCELLENCE" BATTING BONUS. Owner agrees to pay Player an additional

$100,000 on the condition that Player wins the 1985 A.B.L. batting championship, as determined by the

A.B.L. Commissioner.

"PHILOSOPHY OF EXCELLENCE" FIELDING BONUS. Owner agrees to pay Player an additional

$50,000 should Player commit the fewest fielding errors of any Eagle player starting at least 80% of the

1985 regular season games or as few errors as any such player.

The A.B.L. awards its batting championship to the player with the highest batting. average at end of regular

season. On three prior occasions, two players had tied for the highest average; but the league had broken the tie by

considering the players' slugging averages (the total number of bases divided by the number of at bats, four points

for a homerun, three points for a triple, etc.).

At the end of the 1985 season, Bishop and Ozzie Williams of the Phoenix Wildcats tied for the batting title.

Bishop had the higher slugging average. However, with the concurrence of all team owners, the Commissioner

declined to break the tie; she declared Bishop and Williams co-winners of the title.

In December 1985, Bishop demanded the $100,000 batting bonus. Asdrubale refused to pay. He told

Bishop, "I thought I made myself clear. Ties make me sick. If you're not the very best--the one and only, there's no

bonus."

Bishop sues Asdrubale. At trial, the plaintiff introduces a copy of A.B.L. Bylaw IV.C. reading: "League

races cannot end in ties; if at the end of the regular season, two teams are tied in the standings, the winner shall be

decided by the outcome of a playoff game, to be scheduled by the Commissioner. For all other official league

purposes, ties are acceptable." The defense calls Professor Miriam Delgado, the chair of the University of SI Dorado

English Department. She testifies that the most popular meaning of the expression, "the A.B.L. batting

championship," would be a title won by a single person.

34

QUESTION 75

1 INTERPRETATION

11 Step #1: Identify all possible meanings

12 Subjective approach

13 All possible sources

14 Both meanings possible

15 Pure objective approach

16 Face of the document

17 No extrinsic evidence if plain meaning on face

18 Text – in the singular

19 Context – in the second clause

19.1 Only first

21 Modified objective

22 Trade custom

23 Bylaw IV.C

24 Again, both possible

31 Step #2: Classify each meaning as a type of usage

32 General: only one

33 Delgado

34 expert

35 "a single person"

36 "popular"

37 "the most popular"

38 Only first

41 Limited: tie

42 existence of usage

43 Bylaw IV.C

44 "For all other official league purposes"

45 Standing

46 Only first

47 notice of existence of usage

48 Both members of industry

49 Likely familiar with bylaws

49.1 but Asdrubale new to the industry

51 Mutual: only one

52 Evidence before contract formation

53 "philosophy of excellence" speech

54 his philosophy

55 for club

56 for player as well

57 Evidence on face of writing

58 title of clause

59 context

59.1 contrast to wording of other clauses

61 Individual: only one

62 Existence

63 "hate ties"

64 "don't settle for ties"

65 "the best"

66 "make me sick"

67 "the very best"

68 "the one and only"

69 Notice

35

69;1 speech

69.2 Baskam attended

71 Step #3: Choose a meaning

72 Primary basis: order of preference among the types of usage

73 Corbin

74 mutual

75 therefore the one and only

76 Williston


78 arguably

79 otherwise limited

79.1 different choice than Corbin on these facts

81 Secondary basis: canons or maxims of interpretation


83 Asdrubale

84 Asdrubale's attorney

85 Not as much weight as in the past

91 CONDITION

101 Condition: Construe as including a tie

102 condition fulfilled


104 not performed

105 no evident discharge doctrine applicable


111 Condition: construe as requiring first

112 express or constructive condition?

113 language key

114 "on the condition"

121 if constructive

122 excuses

123 substantial performance

124 past practice

125 Ties but slugging average

126 Baskam higher slugging average

127 Purposes

128 Publicity

129 Co-winner

131 Impossibility

132 Third party intervention

133 Commissioner

134 Material part of the bargain

135 Debatable

136 Foreseeable?

137 Past intervention

138 Several times

139 Always broke the tie

141 if express

142 excuses

143 Substantial performance inapplicable

151 Prevention

152 Wrongful?

36

153 Causation

154 Concurred

155 Need concurrence?

156 Need concurrence of all owners?

161 Avoidance of severe forfeiture

162 Applies even to express conditions

163 Material part of the bargain

164 debatable

165 Severe enough?

166 Restatement example: 15%

167 Rest of salary?

168 Not enough facts

SUBSET 2D: QUESTIONS ON INTERPRETATION · 2015. 10. 15. · 1 SUBSET 2D: QUESTIONS ON...

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