Spring, 2001

Group 1 Problem

(Markey, chair)

Scenario #1—Raleigh and our first choice,

B.S. hired K.S. as a contractor to reline part of a furnace.  A crane was necessary to complete the job and K.S. hired E.C., as a subcontractor, to provide the crane and operators. The rental contract between K.S. and E.C contains an indemnity provision whereby E.C. agrees to indemnify K.S., for losses resulting from negligence on the part of E.C. or any of its employees, arising out of, or occurring in connection with, the furnishing of any goods or services.  These types of provisions are void as against public policy in Maryland - Where the contract indemnifies for the full negligence of one party- but enforceable in Pennsylvania.  In Maryland, if the indemnification clause is for anything less than full negligence, the indemnity provision will be enforced.  The rental contract also contains a choice of law provision, which identifies Pennsylvania as the law that governs the terms of the contract.

Issue
        Under Pennsylvania choice of law rules, would Pennsylvania courts defer to Maryland, the forum state, with regard to the enforcement of the indemnity provision in the leasing contract between Songer and Eastern Crane?

Group Issues: 

1) What bearing does the type of tort have on the case?  Should it matter whether the cause of action was partial/contributory negligence or full negligence?

2) Would it be against MD public policy to use the PA law?

3)  What bearing does third parties issues play in applying choice of law doctrines?

 Scenario #2--Sanjay

In Late September of 1989, my father passed-away in a hotel room in Las Vegas.  He died intestate leaving assets (and some debts) in five states and three countries.  Though never legally divorced, my parents had a settlement agreement divying assets from years prior.  Having no other survivors in this country, I was the logical choice to be administrator of his estate and to be responsible for probating it.

Though a very successful cardiologist, my father spent his retirement years as a professional poker player (gambler).  He maintained a residence in the aforementioned hotel, but continued to have an Illinois ID.  Additionally, most of his financial assets/resources remained in IL banks/brokerages.  For tax purposes, and because they were never divorced, my parents continued to file joint-tax returns until his death.

Ironically, clearing his casino cash account was the easiest, as the hotel knew of the circumstances and provided us with a limo and armed security guard to take the cash to the bank.  Beyond that, however, numerous copies of the death certificate needed to be acquired.  We retained the services of McDermot, Will & Emery to assist in probating the estate.  Questions of whose law was to govern (IL & NV) the probate as well as the validity of claims in Canada and India were problematic.

Scenario #3--Patrick

Bill works in mergers and acquisitions out of his home in Wisconsin.  Bill’s informal partner, Bob is domiciled in Wisconsin, but works in New York.  Bill in Bob negotiated with Company A, which is incorporated in New York, to purchase Company B located in Iowa.  The majority of the dealings between the parties were done by phone and fax, but the final contract for sale is drafted and signed in Chicago, Illinois.  After the deal is done, Company A rescinds the offer the next day by phone while in New York.

Which state’s law governs the breach of K?  Would it make sense to bring the action in IL where no party is domiciled? How could IL enforce this judgment?  

Scenario #4--James

Jim moved to Boston to live with his girlfriend at the time, Samantha.  While in Boston, Jim continued to own a condominium in his native Chicago.  Jim lived in an apartment leased to Samantha, and never signed a lease agreement.  The entire time Jim lived in Boston, he continued to pay his assessments on his Chicago condominium.  He had relatives that would go there from time to time to check on things.  After living in Boston at Samantha's apartment for several months, Jim decided to return to Chicago.  While traveling back to Chicago, Samantha ran up a $350 bill on Jim's calling card account.  The account was linked to Jim and Samantha's Boston phone number, which was in Jim's name, and which Jim had not yet disconnected.  Jim arrived back in Chicago, and after closing out the account, received a bill which included the $350 in unauthorized charges made by Samantha.  What law should govern, MA or IL?