Bus Exam 3

Self-Defense (Tort, Defenses to Assault & Battery)

(reasonable force): defending individual's life or physical well being if real or apparent danger is evident and it is reasonably necessary to prevent harm.

Types of Franchises:

-Distributorship. -Chain Style Business Operation. -Manufacturing or Processing Arrangement.

Duty of Professionals

-Duty of care varies, based on the Defendant's occupation, relationship to Plaintiff. --Doctor, lawyer, accountant, engineers -Professionals may owe higher duty of care based on special education, skill or intelligence. Breach of duty is called professional malpractice.

§ 2: Franchises

-Franchise: agreement so that Franchisor (Owner of trademark, trade name or copyright) licenses Franchisee to use the trade mark, trade name or copyright in the sale of goods or services. -Many legal protections were franchises.

LLC Operating Agreement

-LLC Operating Agreement is analogous to corporation's bylaws. -Operating agreements may be oral and contain provisions relating to management, dividends, meetings, transfer of membership interests, and other significant issues. -Generally, if the operating agreement is silent, courts will apply partnership principles.

disadvantages of the LLC

-State statutes are not uniform. But usually apply state law where formed. -Not all states recognize LLC's.

express powers of a corporation

-The express powers of a corporation are found in the corporation's articles of incorporation, the laws of the state of incorporation, bylaws, and resolutions. -A corporation has perpetual existence unless the articles state otherwise & it can be formed for any lawful purpose. -Corporate by-laws may also grant or limit a corporation's express powers.

What are the different types of Liability?

1. Strict Liability 2. Product Liability 3. Strict Product Liability

What is Assault in intentional torts?

ASSAULT is an intentional, unexcused act that: Creates a reasonable apprehension of fear, or Immediate harmful or offensive contact. NO CONTACT NECESSARY. Words not enough.

MAJOR CONCEPT: Limited Liability of Shareholders:

Corporation owners or Corporate shareholders are generally not personally liable for the corporate obligations beyond the extent of their investments.

Requirements for Strict Product Liability

Is strict liability warranted? 1. Product must be in defective condition when sold or leased. 2. Defendant is in the business of selling the product. 3. Product must be unreasonably dangerous. 4. Plaintiff must be physically harmed 5. Defective condition must be proximate cause of injury. 6. Good are in substantially same condition.

Classification of Corporations (Purpose)

PURPOSE 1. Public Corporation: formed by government to meet some political or governmental purpose. 2. Publically Held Corporations: shares of stock are publically traded in a securities market. 3. Private Corporation: created for private benefit and owned by private persons wholly for profit. 4. Nonprofit: Corps formed for purposes other than making a profit. 5. Closely Held Corporations. -Shares held by a relatively few shareholders (usually they know each other/family). -More informal management, similar to a partnership. -Restriction on transfer of shares, usually to family only. -Usually shareholders hold positions of directors and officers. 6. S Corporations: special status for certain closely held corporations. Taxation better (see page 421)

tort

is a civil wrong for which damages can be sought by the injured party for a legally protected, tangible or intangible, interest. (tort=French for wrong). Only compensated by money. There are intentional and unintentional (negligence) torts.

Misappropriation

- Appropriation: Use of another's name, likeness or other identifying characteristic for commercial purposes without the owner's consent (also an invasion of privacy). --Individuals have the right to the exclusive use of his or her identity. ---Case in Point, pg. 273 --Degree of Likeness: courts differ on the degree that you need for likeness. ---Case in Point, pg. 273

Abnormally Dangerous Activities for strict liability

- Defendant is strictly liable for an "abnormally dangerous activity" if: --Activity involves serious potential harm; --Activity involves high degree of risk that cannot be made safe; and --Activity is not commonly performed in the community or area. ---Blasting, storing explosives etc. ---Even if done with the utmost care, still dangerous --Virtually no defense if activity causes injury.

Res Ipsa Loquiter:

- defendant must prove he is not negligent b/c injury could not have occurred without negligence. (i.e. something left inside patient during surgery.) -Plaintiff has burden of proving negligence normally except in certain situations

Special Negligence Statutes

-"Danger Invites Rescue" Doctrine --A person who is injured when rescuing someone else, can sue the person who caused the dangerous situation in which the other person was in peril over. -Good Samaritan Statutes --Persons who are aided voluntarily by others cannot turn around and sue good Samaritans for negligence. (i.e. doctors); -Dram Shop Acts. --Bars can be held liable for intoxicated, overserved patrons causing accidents.

Corporations

-A corporation is a creature of statute, but considered an artificial "person." -A corporation can engage in any act and enter into any contract available to a natural person in order to accomplish the purposes for which it was created. --The corporation can sue or be sued. --It has free speech rights, due process, etc. -The shares (stock) of a corporation are owned by at least one shareholder (stockholder). -Most states follow the Model Business Corporation Act (MBCA) or the RMBCA, that are model corporation laws. --Although many public corporations are federally created.

Torts and Criminal Acts

-A corporation is liable for the torts committed by its agents or officers within the course and scope of their employment under the doctrine of respondent superior. -Corporation can be liable for criminal acts, but only fined. --Responsible officers may go to prison and/or be fined. --Case in Point, pg. 418 Commonwealth v. Angelo Tudesca Corp. (2006).

3. Inadequate Warnings/Defects

-A product may be defective because of inadequate warnings or instructions. -Liability based on foreseeability that proper instructions/labels would have made the product safe to use. --Foreseeable risk of harm posed by the product could have been reduced or avoided by the provision of reasonable instructions and the product is not reasonably safe.

2. Superseding Cause (Defenses to Negligence)

-A unforeseeable, intervening act that occurs after Defendant's act that breaks the causal relationship between Defendant's act and Plaintiff's injury relieving Defendant of liability. -If the intervening act was foreseeable, however, Defendant may be liable for Plaintiff's injuries. -Does something break the chain of events?

Jurisdictional Requirements

-An LLC is a legal entity separate from its owners. -For federal jurisdiction based on diversity, an LLC may be treated differently than a corporation. -For diversity purposes the citizenship of an LLC is the citizenship of its members, which may live in multiple jurisdictions. --We will learn that for a Corporation it is where it is incorporated and has its principal place of business.

Proximate Causation

-An act is the proximate (or legal) cause of the injury when the causal connection between the act and injury is strong enough to impose liability. -Foreseeability of injury is an important factor. -Think of proximate cause as an unbroken chain of events. -Is the connection between the Act and an Injury strong enough to impose liability?

How is a business formed?

-Anyone who starts a business must first decide which form is most appropriate: --Sole Proprietorships --Franchises --Partnerships --Limited Liability Companies --Limited Partnerships --Corporations -Websites available through secretary of states to help: www.sos.ky.gov

Corporate Taxation

-Corporate profits can either be kept as retained earnings or passed on to the shareholders as dividends. -Corporate profits are taxed under federal and state law as a separate "person" from its shareholders. -Profits that are not distributed are "retained earnings" -Regular "C" corporations are taxed twice: at the corporate level and at the shareholder level. --Double taxation feature of Corporation is one of its major disadvantages.

Implied Powers of a Corporation

-Corporation has implied powers to perform all acts reasonably necessary to accomplish its corporate purposes, e.g.,: --Borrow and lend money. --Extend credit. --Make charitable contributions. -A corporate officer can bind corporation in contract in matters connected with the ordinary business affairs of the enterprise.

Classification of Corporations

-Corporations can be classified in many ways, usually depending on its location, purpose, and ownership characteristics.

"Unreasonably Dangerous" Products

-Courts recognize that all products can't be made 100% safe for all uses; all of the time. -Plaintiff must only show that the product was so "defective" as to be "unreasonably dangerous" which means: --Product was dangerous beyond the expectations of the ordinary consumer, OR --A less dangerous alternative was economically feasible for the manufacturer but the manufacturer failed to produce it.

§ 2: Limited Liability Partnerships

-Creature of state statute, similar to an LLC except that an LLP is designed for professionals who normally do business as a partnership (lawyers and accountants). -LLP allows partnership to limit personal liability of the partners but allows "pass through" tax advantages. -Entity that limits the liability of some of its owners (the limited partners). -Creature of state statute. Filing a certificate of limited partnership with the Secretary of State is required. (in contrast to the informal, private, and voluntary agreement that usually comes with a partnership) -Agreement between at least one general partner and one limited partner to carry on a business for profit. --Allowing one's name to be used in the advertisement of the company.

Duty of Care and Its Breach

-Defendant owes duty to protect Plaintiff from foreseeable risks that Defendant knew or should have known about. -Courts use reasonable person standard in those particular circumstances (jury or judge) to determine whether duty exists. -Case in Point, pg. 280 Mcdonalds and hot coffee -The consequences of an act are legally foreseeable if they are consequences that typically occur in the course of event. -Whether an act is foreseeable is generally considered a matter of fact determined by the reasonable person standard (jury). -Palsgraf: "THE RISK REASONBLY TO BE PERCEIVED DEFINES THE DUTY TO BE OBEYED" -In negligence cases, the degree of care to be exercised varies, depending on the defendant's occupation, his or her relationship to plaintiff, and other factors. Duty is judged on a case-by-case basis. -What would a reasonable person do under these circumstances.

§1: Strict Liability

-Defendant's liability for strict liability is without regard to: Fault, Foreseeability, Standard of Care or Causation. -Liability is based on abnormally dangerous activities and for reasons other than fault. -Theory of strict liability started with Rylands v. Fletcher (1868 England). --See page 294 -Rylands: England. Rylands, mill owners, built a reservoir on their land. Water broke through and filled a coal mine passageway used by Fletcher.See page 294 -Strict liability is imposed on tortfeasors for engaging in activity deemed by statute to be so dangerous that the tortfeasors must take full responsibility for all harm that arises there from, even if the tortfeasor was used the utmost care. -"LIABILITY WITHOUT FAULT"

Causation in Fact

-Did the injury occur because of the Defendant's act, or would the injury have occurred anyway? -Usually determined by the "but for" test, i.e., but for the Defendant's act the injury would not have occurred.

Pros of Partnership

-Easy to create and maintain -Flexible, informal -Partners share profits and losses equally

4. Causation

-Even though a Tortfeasor owes a duty of care and breaches the duty of care, the act must have caused the Plaintiff's injuries. --Causation in Fact, and --Proximate Cause. -Palsgraf v. Long Island RR Co. (1928)., pg 283

Invasion of Privacy. (Tort, Defenses to Assault & Battery)

-Every person has a fundamental right to solitude freedom from public scrutiny. 1. Use of Person's Name or Likeness: using a person's name, picture or likeness for commercial purposes without permission is a tortious invasion of privacy. 2. on Individual's Affairs or Seclusion: invading someone's home or searching personal computer; eavesdropping; window peeping etc. 3. Publication of Information that Places a Person in False Light: a story attributing to someone ideas not held by that person (also defamation). 4. Public Disclosure of Private Facts: a person publically discloses private facts (although true) that an ordinary person finds embarrassing or objectionable. (i.e. a newspaper's account of a private citizen's sex life or financial affairs because it is not of public concern.)

Duties and Liabilities of Partners

-Fiduciary Duties: Duty of Care and Loyalty --Duty of Loyalty: requires a partner to account to the partnership for "any property, profit or benefit" ---Case Meinhard v. Salmon, 393 -Joint and Several Liability for Torts. --JSL means 3rd party can sue either one or all partners. --3rd party may collect against personal assets of all partners. --True even if partner didn't participate or ratify conduct. ---Case in Point, pg 395

Misrepresentation

-Fraudulent Misrepresentation is intentional deceit for personal gain. Elements: --Misrepresentation of material fact; --Intent to induce another to rely; --Justifiable reliance by innocent party; --Damages as a result of reliance; --Causal connection. --Is it Fact or Opinion? Need more than --puffery -Abusive or Frivolous Litigation: if lawsuit is initiated out of malice and without probable cause. -Example, it is fraud to say that the roof of a building does not leak when one knows that it does.

What are the damages for Libel?

-General Damages are presumed; Plaintiff does not have to show actual injury. -General damages include compensation for disgrace, dishonor, humiliation, injury to reputation and emotional distress.

No Duty To Rescue

-Generally, law requires individuals to act reasonably, but does not require a duty to help a stranger in peril. There may be an ethical duty to help, but there is generally no legal duty to help. -However, most states require a motorist in an automobile accident to stop and render aid.

What Powers Do Corporations Have?

-Generally, the are allowed to engage in any act and enter into any contract available to a natural person to accomplish the purposes it was formed for. -When created, it creates express and implied powers.

Strict Liability: Product Defects

-Hard to determine what is defective to make it unreasonably dangerous. -Subject to different interpretations. -Three types of product defects have now been traditionally recognized: 1. Manufacturing defects. 2. Design defects. 3. Warning Defects.

Comparative Negligence

-In determining liability, the amount of damages a Plaintiff causes to herself are subtracted from the amount of damages suffered by the Plaintiff, and only the remainder is recoverable from the Plaintiff. -However, if Plaintiff is more than 50% liable, she recovers nothing.

Corporate Personnel

-Individual shareholders own corporation. -Shareholders elect board of directors to manage corporation. -Board of directors makes all policy decisions and hires officers to run corporation on a daily basis.

Limited Liability Companies (LLC)

-LLCs are relatively new creatures of state statute but increasingly become the entity of choice for businesses -An LLC is a hybrid entity that combines the limited liability of a corporation and the tax advantages of a partnership. --A Corporation (usually lower rates that personal tax rates) must pay income taxes on its profits, and the shareholders pay personal income taxes on profit distribution: double tax. --Partnership: LLC pays as an entity pays no taxes but passes through its profits to the members. --1997 IRS rules provide that any unincorporated business (including LLC's) will automatically be taxed as a partnership unless otherwise indicated on the tax return.

Landowners

-Landowners have a duty to exercise reasonable care to business invitees. --In some jurisdictions the duty extends to trespassers as well. --Guard against foreseeable risks (owner knew or should have known). -Duty to Warn business invitees of risks. --Supermarket slip. Did the store fail to exercise reasonable care in protecting store's customer's against foreseeable risks? --Owner may warn in a number of ways. --Obvious risks are an exception, Case in Point, 281 Lady slips on napkin at restaurant/nightclub.

What is being protected in tort law?

-Legally recognized personal and protected interests of: --Personal safety --Freedom of movement --Property --Privacy --Reputation --Damages: Punitive (punish) and Compensatory (actual damages/make Plaintiff whole) -Case in Point, pg. 269 -PPDRF

Nature of the LLC

-Like corporations, LLC's are creatures of state law. -The owners are called "members" (not shareholders) and their ownership is called an "interest" (not shares). -LLCs are legal entities apart from their owners and can be sued or sue. -Members of an LLC enjoy limited liability --Members are not personally liable for the debts or obligations of the entity: Their risk of loss is limited to the amount of their investments -LLC is an enduring business entity that exists beyond the illness or death of its members.

3: Strict Product Liability

-Manufacturers liable without regard to fault based on public policy. -Just as we studied earlier with Strict Liability, this extends to some products that are defective. -This is based on the following policy considerations: --Consumers must be protected from unsafe products; --Manufacturers should be liable to any user of the product; --Manufacturers, sellers and distributors can bear the costs of injuries. (and pass them on to consumers) -Most states recognize strict product liability

Advantages of the LLC

-Member liability is limited to amount of investment. -Can be treated as a "pass through" entity for tax purposes. -Profits can be distributed to members without the double taxation of a corporation. Members pay personal income tax on received dividends.

1. Product Liability Based on Negligence

-Negligence-based product liability is based on a manufacturer's breach of the reasonable standard of care and failing to make a product safe. --Just as we studied in the last chapter. --If a manufacturer fails to exercise "due care" to make a product safe, a person who is injured by the product may sue the manufacturer for negligence. -Manufacturer must exercise "due care" in: --Designing products; --Manufacturing and Assembling Products; --Inspecting and Testing Products; and --Placing adequate warning labels. -No privity of contract required between Plaintiff and Manufacturer. --Liability extends to any person's injuries caused by a negligently made (defective) product, not just the one who bought the product.

1. Manufacturing Defects

-Occurs when a product "departs from its intended design even though all possible care was exercised in the preparation and marketing of the product." -Idea behind holding businesses strictly liable is to encourage greater investment in product safety and strict quality controls. --See Case in Point, pg. 297 ladder collapsed due to manufacturer defect.

2. Product Liability Based on Misrepresentation

-Occurs when fraud committed against consumer or user of product. -Fraud must have been made knowingly or with reckless disregard for safety. -Plaintiff does not have to show product was defective. --Intentional mislabeling of packaged cosmetics or misrepresentation on any label. --Fake Marijuana

2. Design Defects

-Occurs when the "foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable alternative design. . . and the omission of the alternative design renders the product not reasonably safe." -Most courts use a risk-utility analysis. -Case 11.1 Bullock v. Philip Morris USA, Inc. (2008). --Ford Pinto/gas tank placement --Toyota (pg. 297)

Rights and Liabilities of LP Partners

-Only General Partners can manage but they have a fiduciary (to act primarily for another's benefit) obligation to LP's. --GP are personally liable to creditors. -LP's enjoy limited liability as long as they do not engage in management functions. -An LP will be liable to a 3rd party if the 3rd party believes, based on conduct, that the LP is a general partner.

§ 1: Sole Proprietorships Advantages

-Owner is in complete control & receives all profits -Flexibility -Ease of creation; maintenance Case in Point, pg 381 Garden City Boxing Club, Inc. v. Dominquez (2006).

§ 1: Sole Proprietorships Disadvantages

-Owner is personally liable for all torts/contracts -Lacks continuity after death -Difficult to raise financing Case in Point, pg 381 Garden City Boxing Club, Inc. v. Dominquez (2006).

Cons of Partnership

-Partners are personally liable for all torts/contracts -Dissolved upon death -Difficult to raise financing

§ 3: Partnerships

-Partnership is created when two or more persons agree, implicitly or explicitly, to carry on business for profit. -Partners are co-owners with equal right to manage and share profits -Elements (under Uniform Partnership Act): --Sharing of profits or losses. --Joint ownership. --Equal right to participate in partnership management. ---UPA only used in the absence of an express agreement between parties.

Agency Concepts and Partnership Law

-Partnerships are governed both by common law and by statutory laws. -Agency Concepts and Partnership Law: --Each partner is deemed to be an agent and fiduciary of the other. --There may be imputation of liability. --Differ from agents only in that they are also co-owners and share in profits and losses. --Partners are personally liable for the debts of a partnership.

Entity vs. Aggregate

-Partnerships are recognized as separate legal entities: --To own partnership property. --To convey partnership property. -But the partnership IS NOT regarded as a separate legal entity for tax purposes: --Income tax is "passed through" to owners and profit is taxed --The partnership is an "aggregate of the individual partners for tax purposes." --The partnership is a "pass-through" entity in that it has not tax liability and the partner's profit I s taxed as individual income to the individual partner.

Other Applications of Strict Liability

-Persons who keep wild animals are strictly liable for injuries caused by the beast. -Persons who keep domestic animals are liable if the owner knew or should have known that animal was dangerous. --Negligence and foreseeability -Other things the state determines should be included.

1. Assumption of Risk (Defenses to Negligence)

-Plaintiff has adequate notice and understanding of the risks associated with an activity. -He knowingly and willingly engages in the act anyway. -Plaintiff, in the eyes of the law, assumes the risk of injuries that fall within the scope of the risk understood. --Case in Point, pg. 284 --Pfenning v. Lineman, pg. 285 --Sutton v. Eastern New York Youth Soccer Assoc. New York Supreme Court, 2004.

Proving a defective condition (product liability)

-Plaintiff need not show why or how the product became defective. -Instead, the Plaintiff must show that the product was defective at the time it left the hands of the seller. --This defect made it unreasonably dangerous (see next slide).

§2: Product Liability

-Product Liability: --Liability for those who make, sell, or lease goods can be held liable for physical harm property damage caused by those goods to a consumer, user, or bystander. --It is a social policy based on 2 factors ---Company can better bear the costs of damages /spread it over society by increasing costs of goods ---Company is making a profit and therefore should bear the cost of injury ---See page 296, Greenman v. Yuba Power Products

Public Figures

-Public figures exercise substantial governmental power or are otherwise in the public limelight could be "fair game" with defamatory statements. --Could be involuntarily a "public figure" or a limited public figure. -To prevail for defamation or libel, they must show "actual malice": statement was made with either knowledge of falsity or reckless disregard for the truth. --Because of the extremely high burden of proof on the plaintiff, and the difficulty in proving essentially what is inside a person's head, such cases—when they involve public figures—rarely prevail. --Case in point, 272

Liability in an LLP

-Recall that partnership law makes all partners jointly and severally for another partner's tort, including personal assets. -The LLP allows professionals to avoid personal liability for the malpractice of other partners. -Supervising Partner is also liable for acts of subordinate.

§7: Special Negligence Doctrines and Statutes

-Res Ipsa Loquiter: defendant must prove he is not negligent b/c injury could not have occurred without negligence. (i.e. something left inside patient during surgery.) --Plaintiff has burden of proving negligence normally except in certain situations -Negligence Per Se: occurs when Defendant violates statute that causes injury to Plaintiff: --Statute sets out standard of care. --Plaintiff is member of class intended to be protected by statute. --Statute designed to prevent Plaintiff's injury. ---Driving statutes. Case in Point, 288 backed truck into car and plaintiff sues for back pain.

What is Defamation in intentional torts?

-Right to free speech guaranteed by the First Amendment is constrained by the duty we owe each other to refrain from making false statements. -Society has an interest in preventing and redressing attacks on reputation. --Must refrain from making false, defamatory statements of facts about others. -Orally breaching this duty is slander; breaching it in print or media is libel. Gravamen of defamation is the "publication" of a false statement that holds an individual up to hatred, contempt or ridicule in the community. Publication requires communication to a 3rd party either intentionally or accidentally to persons OTHER than the defamed party. If Tommy writes Andrew a private letter accusing him of embezzlement is it libel? If you happen to repeat a libel or slanderous remark, you are liable too.

Partnership Operation

-Rights of Partners: In the absence of a partnership agreement (oral or written) state statutes govern the partner rights: --Management: equal, each one vote, majority wins; need unanimous consent for some actions. --Partnership Interest: equal profits, losses shared as profits shared. ---Interest in Partnership property too. -Partnership Agreement: See page 390

What are the damages for Slander

-Rule: Plaintiff must prove "special damages" (actual economic loss). --Why the difference? Oral statements have a temporary quality. -Exceptions for Slander Per Se. No proof of damages is necessary: --Loathsome disease, --Business improprieties, --Serious crime, --Woman is non-chaste/serious sexual misconduct -McClune v. Neitzel.

Elements (under Uniform Partnership Act)

-Sharing of profits or losses. -Joint ownership. -Equal right to participate in partnership management. --UPA only used in the absence of an express agreement between parties.

Sole Proprietorships

-Simplest form of a business organization. -The owner is the business; anyone who does business without creating a separate business organization has a sole proprietorship. -More than 2/3 of all American businesses are sole proprietorships and are usually small enterprises.

Franchise Contract

-The Franchise Contract can include: --Franchisee's type of business entity including capital structure, sales quotas and record keeping. --Location of the Franchise --Premises is leased or purchased --parties' rights and duties that can include an exclusive "territory" to market goods/services. -Quality Control is a legitimate issue for Franchisor because of good will, reputation and trademark value. -Courts will not question Franchisor's strict supervision but Franchisor may be liable for torts of agents. -Case 16.2 Kerl v. Dennis Rasmussen, Inc. (2004). -A franchisor's termination of a franchise often has adverse consequences: "WRONGFUL TERMINATION" --Mac's Shell Service, Inc. v. Shell pg. 386; case in point, 294

Nature of the Corporation

-The corporation substitutes itself for the natural persons in conducting corporate business and incurring liability. --But its authority and liability are separate and apart from the shareholders. -In certain situations, the corporate "veil" of limited liability can be pierced, holding the shareholders personally liable.

Management of an LLC

-There are two options for management, generally set forth in the articles of organization: --Member-Managed: all of the members participate in management, like a partnership. --Manager-Managed: members are elected to manage the LLC. -If the articles are silent, statutes provide either that each member has one vote or votes are made based on percentage of ownership. -Case in Point, 408 cashed check and sued b/c wasn't authorized to cash it but had no written operating agreement so was authorized.

Obvious Risks (products)

-There is no duty to warn about obvious or commonly known risks. -Seller must also warn about injury due to product misuse. Key is whether misuse was foreseeable. -Case in Point, pg. 300 flip 0n trampoline caused kid to become paralyzed and sued, and lost --Crosswhite v. Jumpking, Inc. (2006).

LLC Formation

-To form an LLC you must file Articles of Organization with a central state agency, usually the secretary of state. -Articles of Organization require: --Name of Business. --Principal Address. --Name and Address of Registered Agent. --Names of the Owners; and --How the LLC will be managed. -Business name must include LLC or Limited Liability Company.

3. Injury Requirement and Damages (tort)

-To recover, Plaintiff must show legally recognizable injury resulting from wrong. --No tort if no harm. --Injury could be loss, harm, wrong, or invasion of protected interest. -Compensatory Damages are designed to reimburse Plaintiff for actual losses. -Punitive Damages are designed to punish the tortfeasor and deter others from wrongdoing. -See notes, 341

What are the damages Defamation

-Truth is generally an absolute defense. -Privileged (or Immune) Speech. --Absolute: judicial & legislative --proceedings; attorneys in courtroom; judges. Governmental officials in legislative debate. --Qualified: Employee Evaluations. Generally privilege exists if made in good faith and have a legitimate interest in the communication. ---Only can recover is privilege is abused.

3. Contributory & Comparative Negligence (Defenses to Negligence)

-Under common law, if Plaintiff if any way caused his injury, he was barred from recovery. This was known as Contributory Negligence. -Most states have replaced contributory negligence with the doctrine of comparative negligence. -The operative concept in comparative negligence is that one cannot recover from another for any injuries one has caused to oneself.

Business Torts

-Wrongful Interference: Tort that interferes with a contractual relationship. --Occurs when: ---Defendant knows about contract between A and B; ---Intentionally induces either A or B to breach the contract; and ---Defendant benefits from breach. --Any lawful contract can be the basis for this action. --Case in Point, pg. 276. -Wrongful Interference with a Business Relationship occurs when: --Established business relationship; --Tortfeasor, using predatory methods, causes relationship to end; and --Plaintiff suffers damages. --See page 276 -Defenses: action(s) were justified, permissible, or bona fide competitive behavior. --Difference between competitive behavior and predatory behavior is hard to find. Notes 339

Negligence Per Se:

-occurs when Defendant violates statute that causes injury to Plaintiff: --Statute sets out standard of care. --Plaintiff is member of class intended to be protected by statute. --Statute designed to prevent Plaintiff's injury. ---Driving statutes. Case in Point, 288 (delaware)

What are the Types of Intentional Torts Against People?

1. Assault and Battery. 2. False Imprisonment. 3. Infliction of Emotional Distress. 4. Defamation. 5. Invasion of Privacy -Misappropriation -Misrepresentation 6. Business Torts.

§6: Defenses to Negligence

1. Assumption of Risk. 3. Superseding Intervening Cause. 4. Contributory or Comparative Negligence.

§4: Defenses to Product Liability

1. Assumption of Risk. --See Boles v. Sun Ergoline, Inc. Pg. 302. --Failing to obey product recall 2. Product Misuse (Plaintiff does not know the product is dangerous for a particular use). --See Case in Point, pg. 303 child wearing seatbelt behind back and too young to know better. 3. Comparative Negligence. --See Case in Point, pg. 304 didnt wear hard hat and found person liable 4. Commonly Known Dangers/ Knowledgeable user --See Cases in Point, pg. 304 eating at McDonalds made them fat 5. Statutes of Limitation. -See Review, page. 305

What are the defenses of Assault and Battery?

1. Consent 2. Self-Defense 3. Defense of Others 4. Defense of Property

What are the 4 Elements of Negligence?

1. Defendant owed Plaintiff A duty of care (to exercise reasonable care); 2. Defendant Breached that duty; 3. Plaintiff suffered legal injury or Damage; 4. Defendant's breach Caused the injury. -If no risk is created, no negligence. If any of these elements are missing, might be liability but not on a negligence theory.

CORPORTE FORMATION

1. Select State of Incorporation. --Delaware has historically had the least restrictive laws. (allow corp. to be located elsewhere) --What else are corporations looking for? 2. Securing the Corporate Name. Name must have the proper suffix: "Corporation," "Corp.," "Incorporated." --Depend on state approval. Must not be duplicative. 3. Prepare & File Articles of Incorporation: primary enabling document filed with the Secretary of State that includes basic information about the corporation. Person(s) who execute the articles are the incorporators. --Needs to include name, number of shares, registered agent, and names of incorporators.

Defense of Others (Tort, Defenses to Assault & Battery)

An individual can act in a reasonable manner to protect those in real or apparent danger.

What is Intentional Infliction of Emotional Distress in intentional torts?

An intentional act that is: -Extreme and outrageous, that -Results in severe emotional distress in another. -Must exceed the bounds of decency accepted by society. TRULY OUTRAGEOUS. Most courts require some physical symptom or illness, not just annoyance -Prankster calls a pregnant women and says her husband and 2 kids killed in accident and she suffers a miscarriage. -Case in point, pg. 270 & more discussion points

What is Battery in intentional torts?

BATTERY is the completion of the Assault: Intentional or Unexcused. Harmful, Offensive or Unwelcome. Physical Contact. Physical injury need not occur and the contact can be any body part or anything touching a body part. (hat, purse) Whether contact is offensive is determined by the reasonable person standard. The contact can be made by the defendant or by some force that the defendant sets in motion (i.e. a thrown rock or poisoned food.) John threatens Larry with a gun. The act of pointing it is an assault. The bullet hitting Larry is a battery.

What is False Imprisonment in intentional torts?

False Imprisonment is the intentional: -Confinement or restraint. -Of another person's activities. -Without justification. --Interferes with freedom to move without restriction. Merchants may reasonably detain customers if there is probable cause. -Shoplifting: most states allow businesses to hold suspected shoplifters for police for a reasonable period of time but it has to be security not salesclerks etc. ("Privilege to detain")

1st. Amendment Concerns & IIED/Defamation

If outrageous conduct consists of speech about a public figure, the First Amendment's right to free speech limits emotional distress and defamation claims. Hustler Magazine v. Falwell, 485 US 46 (1988), case in point, 271 The Court found that reasonable people would not have interpreted the parody to contain factual claims, leading to a reversal of the jury verdict in favor of Falwell, who had previously been awarded $150,000 in damages by a lower court. See also pg. 271

Negligence

In contrast to Intentional Torts, the Tortfeasor in a negligence claim does not intend the consequences of the act or believes they will occur. Actor's conduct merely creates a foreseeable risk of injury.

Classification of Corporations (location)

LOCATION 1. Domestic corporation does business in its state of incorporation. Corporation does not have an automatic right to do business in a state other than its state of incorporation but need a "certificate of authority" from foreign state. 2. Foreign corporation from X state doing business in Z state. 3. Alien Corporation: formed in another country doing business in United States.

Liability for Products can be based on:

Liability for Products can be based on: 1. Negligence; 2. Misrepresentation; 3. Strict Liability; or (section 3) 4. Warranty Theory. (already discussed under UCC) *Multiple theories of liability may be asserted in the same case.

Defense of Property. (Tort, Defenses to Assault & Battery)

Reasonable force may be used to defend property CASTLE DOCTRINE: a person has no duty to retreat from an attack in one's home and may use force including that possibly causing death, although force that is likely to cause death can not normally be used to protect property only.

What a person do with intentional torts against another person.

The person committing the tort, the Tortfeasor or Defendant, must "intend" to commit the act. Intent means: Tortfeasor intended the consequences of her act; or He/She knew with substantial certainty that certain consequences would result. An evil or harmful motive is not required

Consent (Tort, Defenses to Assault & Battery)

The plaintiff consented to the act (sports)

TORT LAW:

compensates ($) those who suffer a loss or injury due to another's wrongful acts.