June 09, 2011
Stories and Problems
Posted by Gillian Hadfield

I really like Lawrence's post about the stories in his book that he uses to show students how contract issues are relevant to current events (unlike the dusty cases in the casebook) and for showing contracts in different postures, not just litigation.  This looks like a great resource for a first year class. 

But let me also tie back to the point in my first post:  the problem in our first year contracts courses is not primarily student's appreciation for the role of contract in modern society--that would be a problem for a course ABOUT contract law.  While giving students those modern examples will be a great motivator and energizer for the classroom, the real problem is giving students engaged opportunities to PRACTICE DOING contractual analysis.  The team-based problems I give students in my course (they work with three different fact scenarios during the semester in four assignments--the first two double up on the same fact scenario) just give fictional accounts of contract problems--like any old contracts exam--and that also gets students engaged with how contracts play out in familiar settings.  The problems I've used involve things like:

1.  A recent college grad with a new software idea who meets up for lunch with his college roommate who is now very wealthy.  Roomate says "sure, I'm happy to invest", budding entrepreneur heads out and spends money, and then roommate is nowhere to be found.  (This is a problem I give students on the first day of class--its' the basis for the first two assignments which roll out over the next month.)

2.  An art school student (see the picture?) who has helped out his middle-aged children's fiction writer neighbor for years with work around the house is asked by the neighbor to watch the house and take care in particular with some tasks related to her recent book and illustrations.  Artwork and misunderstandings about whether there's any deal to pay him for some work he does that saves her from the default of her regular illustrator while she's out of town and unreachable follow.  (Also a begining of semester problem.)

3.  Family in the yogurt business, with a father who is obsessive about organic standards and a recent college grad daughter who is now an executive.  Discussions with president of organic milk supplier, contract reached to go above and beyond the national standards, father becomes suspicious about organic compliance, objects to conduct he believes falls short of the standard he contracted for but which clearly exceeds national standards, wants out of the deal.  Students are given short contracts (eg. the 1 pager from the consulting case I worked on on which this case was loosely based), excerpts from organic foods regulations, and asked to advise about what to do.

4.  Owner of a horse farm which boards and trains horses has an existing mortgage which she worked out with her long-time local banker years ago which ostensibly includes rights to be in default in exceptional circumstances up to six months; she has taken advantage of this with no trouble a number of times over the years.  The local bank gets a sharp new banker when the old one retires who is anticipating the sub-prime mortgage collapes and who is determined to clean up bad mortgages.  Owner is in default, thinks she can just take advantage of grace period, tough new banker brings her in, shows her (as it turns out, fake) newsletter predicting large increase in mortgage rates that will kill the ability of owner to pay once her ARM starts to float in a few months, and says "sign here to sell off half your farm and horses and refinance or we foreclose tomorrow."  Spiteful sale of horses at unreasonable prices, some sold for meat, etc., ensues.   Students get excerpted language from contracts, glossary of finance terms. [This problem is used at the end of the course; as is my usual practice, it is the problem from the previous year's final exam.]

5.  Other problems involve two women who run an outdoor adventure outfitting business with unclear partnership/employment relationship, a contract between a mega-firm and a small software developer with suggestions that price is negotiated on basis of expectation that key personnel will be made available who are not, another unclear partnership arrangement to set up a new concept for a wine tasting retail outlet, and one based on the novel Snow Falling on Cedars (contract with Japanese residents of Washington State just before WWII for use of land for strawberry farm; payments in default due to internment.) 

Students really get engaged with these problems --and voice the observation that because they are engaged--they really want to figure out what to do for these clients--they are motivated to really dig into what all these legal rules and concepts they are studying in the 'dusty' cases mean here and now.


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