BLAW Notes Week 7
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This 8 page Class Notes was uploaded by Winston on Friday October 7, 2016. The Class Notes belongs to BLAW 2013 at University of Arkansas taught by Norwood in Fall 2016. Since its upload, it has received 3 views.
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Date Created: 10/07/16
1. Breach of Duty a. Not exercising reasonable care i. Everyone has an obligation to exercise reasonable care 1. Reasonable care is to be decided by jury (or judge) a. Burden of proof: i. Preponderance of evidence 1. Defenses: a. Contributory negligence 2. Defendant is also arguing that the plaintiff was also (contributory) negligent -- let’s say the defendant proves that the plaintiff was 25% negligent; then the COMPENSATORY damages would be released by 255 3. If the plaintiff knew there was a risk, the defendant is not guilty -- example, baseball game a. Negligence per se: i. Automatic liability if the defendant’s act is in violation of statute b. Good Samaritan law i. Exempts a person who ‘attempts’ a rescue 1. If the person trying to rescue someone causes more damage (in most states) they are ok c. Ambit of foreseeable risk i. P. 235 1. If you're not in the “ambit of foreseeable risk” then the company/person is not responsible for the damages you occur a. New York Time, Aug. 25, 1934 d. Damages i. Property ii. Medical iii. Loss of earnings 1. Wages iv. Pain and suffering v. Punitive damages 1. Severe negligence by defendant vi. Loss of consortium 1. Guy has to stay in hospital, wife is not receiving the ‘love and affection’ he normally gives her 4. Strict liability a. “Strict Liability” i. Liability regardless of fault (negligence) 1. Areas where this might apply: a. Abnormally dangerous activities i. Blasting and demolition ii. Storing explosives iii. Keeping wild animals 1. Exceptions a. Professional malpractice b. Dogs biting people 5. Some states give the dog 1 bite (Arkansas, Texas) 6. Some states don’t - “strict liability” (California, Oklahoma) a. Product liability i. The basic “public policy”: Shift the risk from the victim to the seller. Negligence not a consideration 1. Tort action: requirements (Restatement 402A) a. Professional seller b. Defective c. Unreasonably dangerous d. No “privity of contract” required e. Not liable if product changed f. Liability cannot be waived i. Urban legends: 1. No one has actually: a. Filed a lawsuit for using a lawn mower as a hedge fund clipper b. The normally strict liability only deals with products that are defective 7. On a child’s Superman costume -- “this device does not actually make you superman” 8. Laws assisting unsecured creditors a. The statutory lien i. Helping a creditor to collect on an unsecured debt 1. Example a. Mechanics lien i. Mechanic can go repossess the car if he isn’t paid b. Statutory lien i. Brandon Barber borrowed $42,000 to build part of a house 1. He sold that house to Family A a. Branton Barber never paid back that $42,000 and skipped town 9. Family A had to pay it or have their house repossessed a. Garnishment of wages i. Limited by both federal law (federal consumer credit protection act) and state law 1. Takes a portion of the debtor's income each paycheck a. Some states don’t allow this i. Texas doesn’t allow garnishment of wages 1. Federal law says the debtor has to be able to keep 75% of their pay b. Remedies for secured creditors i. Mortgages 1. Cars 2. Houses c. Real property loans i. Fixed rate loan 1. Interest rate does not change over the time of the loan ii. Adjustable rate loan 1. Interest rate changes, based on the current rate iii. Reverse mortgage 1. Borrowers have to be at least age 62 2. The bank pays the borrower every month a. They have to pay this back “when the last person leaves the home i. Moving ii. Dies 1. The bank sells the house 10.Real property a. Acceleration clause i. House is “underwater” 1. Owes more than its worth 11.Personal property: foreclosure procedures and the “self-help” doctrine a. Can foreclose “on your own” but cannot “breach the peace” i. What constitutes “breach of the peace”? 1. Chrysler Credit Corp. v. Koontz, 661 N.E.2d 1171 a. Guy had his car repossessed at midnight, he ran out screaming “don’t take it” but they did anyways i. They can legally take it b. After repossession of personal property i. Keep property in full satisfaction of debt (both parties must consent) ii. Private sale (must notify debtor) iii. Public sale (must notify debtor) iv. Deficiency judgment 1. If the sale doesn’t bring enough money to pay off the debt 12.Other protections for debtors a. Exemptions i. Both state and federal law (bankruptcy) ii. Protection against unreasonably high interest rate 1. Usury a. Traditionally state law i. Arkansas 1. 17% - very low a. Most other states are in the mid to high 20%s b. This 17% is stated in the Arkansas constitution 13.That means it would have to be changed by a vote by the citizens 1. Payday loan a. Very short loan i. Maybe 2 weeks 1. He’ll pay it back then because that’s when it’s payday and he’ll have money a. These have “low” rates i. Until you multiply it out week by week, month by month…. 2% for 2 weeks is 52% for the year ii. We are interested in the annual interest rate, not just what it’s going to be for two weeks Wednesday 10/05/16 14.Top five reasons people go bankrupt a. Medical expenses (62%) b. Job loss c. Poor (excess) use of credit d. divorce/separation e. Unexpected expenses (thefts/casualty) 15.Bankruptcy law a. Combination of federal and state law b. Bankruptcy reform act of 2005 i. 10 years in the making 1. Bankruptcy courts a. Under the authority of the U.S. District Courts i. Not appointed, not lifetime, only hear bankruptcy cases 1. Subservient to U.S. district judges in their area a. Which state has the most bankruptcy filings per capita for the year ended 2015? i. Tennessee b. Texas has less than ½ the national average 16.Kinds of bankruptcy a. Chapter 7 i. Straight liquidation (70%) b. Chapter 9 i. Cities c. Chapter 11 i. Business reorganization 1. Assets are not repossessed d. Chapter 12 i. Farmers e. Chapter 13 i. Wage earners plan 1. Consumer reorganization a. Assets not repossessed i. Will slowly pay off debt 17.The bankruptcy reform act of 2005 a. Gives bankruptcy judge authority to dismiss a chapter 7 (straight liquidation) and convert it to a chapter 13 (wage earner’s plan) i. Presumption of abuse if current monthly income is above a certain level 1. Basically, if family income is greater that the median income in that state, a chapter 13 may be required a. About $50,000 i. The court uses “the means test” b. Credit counseling i. Must get a statement from an accredited non-profit credit counseling 18.Procedures a. File in federal court: “date of bankruptcy” DOB i. Automatic stay 1. Forms under oath a. Selection of trustee i. Trustee represents the creditors 1. Will try to gather up as much property as possible, liquidate it and give the money to the creditors a. Straight liquidation = all non- exempt property seized and sold i. If chapter 11 or chapter 13, reorganization plan submitted and approved ii. Debts paid over 3-5 years 19.Straight liquidation procedures a. Anything you earn after the date of bankruptcy is yours to keep i. That what you earn after the DOB is not part of the bankruptcy estate 1. This does not include “passive” income a. When the debtor files for bankruptcy he forfeits stocks too i. Anything inherited or received by a gift within 6 months after the date of bankruptcy is not yours to keep 20.Fraudulent transfer a. When someone gives away all their assets and then files bankruptcy i. The two-year rule 1. The debtor either had actual intent to defraud creditors OR the transfer caused the debtor to become insolvent (some states longer than 2 years) a. If you do it with “specific intent” then you can spend 3-5 years in federal prison i. Preference 1. The 90-day rule a. Any payment to an unsecured creditor which gives them an unfair advantage (paid back more) over other creditors, must pay that back to the Trustee, who will redistribute it 21.Exemptions in a straight liquidation a. Debtor chooses either federal or state exemptions 22.Arkansas Exemptions a. Wearing apparel i. Not jewelry b. $200 i. $500 if married c. Homestead (if married or have a family) Friday 10/07/2016 23.Homestead exemption a. Took a long time to get passed i. A lot of political turmoil 1. “The homestead cap is a violation of state’s rights” - George W. Bush 24.Priorities a. “All creditors are equal, but some are more equal than others….” i. Priority creditors (in order) 1. Secured creditors 2. Child and spousal support obligations 3. Administrative expenses 4. Wages and salaries (when the debtor has employees) up to a dollar maximum 5. Taxes (3 years) 25.Non-dischargeable debts a. Taxes within 3 years b. Any debt resulting from fraud c. Liability for willful torts i. Accidental torts are dischargeable though d. Alimony and child support e. Any debt not listed i. If you forget to list it, it won’t/can’t be discredited f. Government guaranteed student loans i. Unless undue hardship (not important for test) g. Debts resulting from DWI 26.Denial of a discharge (aka: the death penalty) a. destroying/falsifying records b. Making a false statement under oath c. Secretly transferring or concealing property d. Having received a discharge in the previous 8 years 27.A few final things “just chill, ignore these” a. You can reaffirm a debt with court permission b. Bankruptcy will stay on your credit report for ten years c. Some employers review your credit record (and Facebook!) before deciding whether to offer a job d. Some creditors will abuse the 8 years 28.Chapter 12: Real Property a. Real property i. Land, buildings, plants, mineral rights, air rights ii. Fixtures 1. Something that was originally personally property a. But i. Has been affixed to your real property 1. Ceiling fans 2. Chandeliers a. NOT i. Above ground pool ii. Curtains iii. Above ground hot tub 29.Forms of ownership a. Fee simple absolute i. Highest form of ownership under common law 1. Owner has ownership in his/her life and can decide who gets it when they die b. Life estate i. Lesser than fee simple absolute 1. Owner has property fee simple absolute a. He transfers his property to two people under two forms i. Life tenant 1. Present interest a. Has that property until they die i. This person can sell the estate ii. The buyer will own it until the life tenant dies ii. Remainderman 1. Future interest a. Gets the property when the life tenant dies i. They will own it in fee simple absolute ii. The remainderman can sell their future ownership 30.Forms of multiple ownership a. Ownership in common i. A - B - C 1. They can own in ANY proportion 2. Any one of them can sell their interest to another party without permission from the other owners a. If one dies, their heirs inherit the property (or whoever he willed it to) b. Joint ownership (joint tenancy) - defeats the rights of heirs i. A - B - C 1. The proportions have to be equal a. 33.33333333% each 2. One can sell their ownership a. If A sold to X i. X owns in “ownership in common” 1. X is not a joint owner a. He could split that up 3. If one dies, their share goes to the other owners a. If X, B and C are now owners and B dies, C receives all of B’s share c. Tenancy by the entirety i. The owners are married 1. The survivor takes the share of the other a. Neither spouse can independently sell their share i. If sold, must be sole in entirety
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