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- 1) Preliminary Injunction
- 2) Permanent Injunction
- 3) Constructive Trusts
- 4) Equitable Liens
Injunctive Relief: Threshold Inquiry
- Determine if you're required to discuss a permanent or preliminary injunction.
- Permanent: Issued after full trial on the merits
- Preliminary: issued pending trial on merits.
- If in doubt, lien towards permanent, though this isn't definitive.
Preliminary Injunctive Relief: Two Part Test
- 1) P must establish that there is an 'irreparable' injury.
- 2) P must establish the likelihood/probability of success
Preliminary Injunctive Relief: Irreparable injury
- discuss facts in a time frame context.
- one must show he will incur irrparable injury whie waiting for a full trial on the merits; hence he needs relief now.
- Note: Irreparable injury is weighed against any hardship D will suffer if a temporary injunction is granted.
Preliminary Injunctive Relief: likelihood of success
Remember to mention that the court should impose a bond requirement on P to reimburse D if the injunction injures him and P does not succeed.
Temporary Restraining Order
- Issued pending a hearing to determine whether a preliminary injunction should issue.
- 1) irreparable injury to P; and
- 2) likelihood fo success.
- Distinct from a preliminary injunction:
- (i) TRO proceedings can be ex parte for emergencies (though a good faith effort to allow the D to appear is required)
- (ii) thus, no notice is required.
- (iii) no adversarial proceeding is required.
- TRO is limited to 10 days (14 in federal court), after which P must obtain a preliminary or permanent injunction hearing.
- Note - it is very difficult to obtain any type of preliminary injunctive relief that is mandatory inthis form.
Permanent Injunctive Relief
- Five-part Checklist (Mnemonic: "I put five bucks down"):
- 1) inadequate legal remedy alternative
- 2) protectible interest requirement
- 3) feasibility of enforcement
- 4) Balancing of hardships
- 5) Defenses
Permanent Injunctive Relief: Inadequate legal remedy alternative
- Rule: P must establish there is no viable legal remedy alternative (P's Burden).
- Four recognized reasons:
- 1) irreparable injury. Note - 'unique' property is regarded as an irreparable injury
- 2) monetary damages would be too speculative
- 3) continuing wrong; injunction avoids multiplicity of actions
- 4) defendant is insolvent
Note - Replevin and Ejectment (remedies for regaining possession of personal and real property) are other legal remedy alternatives.
Permanent Injunctive Relief: Protectible Interest Requirement
- Rule: P must show there is a protectible interest involved (P's Burden).
- D builds a fence encroaching on P's property
- D infringes on P's trademark
- D stalks P.
Permanent Injunctive Relief: Feasibility of Enforcement
- Rule: the injunction must be enforceable (P's burden)
- Negative Injunctions (requiring D to stop doing something) have no enforcement problems.
- Mandatory Injunctions (requiring D to affirmatively act) - may be an enforcement problem based on (i) the difficulty of supervision or (ii) concern with effectively ensuring compliance.
- 1) complex act involving great taste, skill or judgment; injunction denied.
- 2) a series of acts over a period of time; injunction denied.
- 3) out-of-state act required; granted if D is a resident; denied if D is a non-resident.
Permanent Injunctive Relief: Balancing of Hardships
- Rule: equity balances P's benefit against D's hardship.
- There must be substantially more hardship than benefit.
- Even then, there will be no balancing of D's hardship if his conduct was willful.
- Hardship to the public is also taken into account (here it would be P's benefit v. D's hardship + public hardship)
- If you decide to balance hardships, in whole or in part, consider the alternative of giving P money damages most of the time. If you deny injunction based on public hardship, grant money damages.
- Balancing hardship is almost always discussed for the torts of nuisance and trespass to land.
Permanent Injunctive Relief: Defenses
- 1) Unclean Hands
- 2) Laches
- 3) Free Speech
Permanent Injunctive Relief: Defenses - Unclean Hands
- Rule: P's improper conduct will cut off the right to equitable relief, provided however, that the improper conduct must be related to the lawsuit.
- Note - if P is a undeniably bad guy, but his bad qualities have nothing to do with the lawsuit, the defense will not work.
Permanent Injunctive Relief: Defenses - Laches
- Rule: Inequitable delay by P in seeking equitable relief cuts off the right to it.
- When does the clock start? When P knows of the injury.
- When does the delay cut off the right to relief? When it has been both unreasonable and prejudicial to the D.
- If laches applies, consider giving P monetary damages
Permanent Injunctive Relief: Defenses - Free Speech
if the tort is defamation or publication of private facts or false light, the best exam answer is to deny the injunction on free speech grounds.
- Imposed on improperly acquired property to which D now has title. D must return the property to P.
- 1) Inadequate legal remedy alternative (i.e. D is insolvent or the property is unique)
- 2) tracing is allowed (i.e. D sold the property and put the cash in the bank)
- 3) Bona fide purchasers prevail over P.
- 4) When D's property cannot be traced solely to P's property, a constructive trust is unavailable.
- Imposed on improperly acquired property to which D now has title. Property will be subject to an immediate court-directed sale. The proceeds go to the P.
- If the proceeds of sale are less than the fair market value of the property when it was taken, a deficiency (money) judgment will issue for the difference and can be used against D's other assets.
- 1) Inadequate legal remedy alternative (i.e. D is insolvent)
- 2) Tracing is allowed
- 3) bona fide purchasers prevail over P.
- 4) When D's property cannot be traced solely to P's property, only an equitable lien is available.
Constructive Trust v. Equitable Lien
- If the property value subsequent to the taking goes up --> P prefers a constructive trust.
- If property value goes down --> P prefers an equitable lien.
- When D's property cannot be traced solely to P's property, only an equitable lien is available.
- 1) Specific Performance
- 2) Rescission
- 3) Reformation
Specific Performance: Five-part checklist
- 1) K is valid
- 2) performance of P must be assured
- 3) Inadequate legal remedy alternative
- 4) Feasibility of Enforcement
- 5) Defenses
Specific Performance: K is valid
P must show the K is valid (P's Burden)
Specific Performance: Assured performance of P
- P must be able to show his performance is assured (i.e. already performed or ready and able to perform)
- (P's Burden)
Specific Performance: Inadequate Legal Remedy Alternative
- P must show no viable legal remedy alternative(P's Burden).
- Four reasons
- 1) damages are too speculative
- 2) D is insolvent
- 3) multiple suits are necessary
- 4) thing bargained for is unique
Specific Performance: Inadequate Legal Remedy Alternative - Uniqueness
- Real Property: land is always unique, even if the question makes it look the same. This applies equally to buyers and sellers. Both can get specific performance.
- Personal Property - General Rule: personal property is not unique; damages are adequate.
- Personal Property - Exceptions:
- 1) one of a kind or very rare
- 2) personal significance to buyer
- 3) circumstances make the chattel unique (e.g. OPEC cuts production, rendering gasoline unique); uniqueness measured at the time of litigation - not at the time of contract formation.
Specific Performance: Feasibility of Enforcement
- P must show enforcement is feasible (P's Burden).
- Enforceability of Personal Services Ks: not specifically enforceable b/c of enforcement problem/involuntary servitude
- Covenant not to compete - 2-part test: (1) the services are unique (sales clerk v. president); and (2) the scope (geographic and durational) is reasonable.
Specific Performance: Defenses
- 1) Unclean Hands (same as tort remedies)
- 2) Laches (same as tort remedies)
- 3) Unconscionability
- 4) Mistake (see contract rescission)
- 5) Misrepresentation (see rescission)
- 6) Statute of Frauds (see rescission)
Specific Performance: Defenses - Unconscionability
- More than simply a 'bad deal.' There must also be some 'smell factor' that brought it about.
- Tested at the time of contract formation; not the time of litigation.
- Basic Test: whether, in light of the general commercial background and needs of the parties, the contract is so one-sided as to be unconscionable.
- Possible unconscionability in the event of an unfair surprise.
Specific Performance Mnemonic
- Vacant Properties Intensify Foreclosure Disaster
- Valid K
- Performance of P Assured
- Inadequate Legal Remedy
- Feasible Enforcement
- Definition: original K is considered voidable and rescinded.
- Analysis (Mnemonic: "Good Dog"):
- 1) grounds for rescission
- 2) Defenses
- 7 General Grounds:
- 1) Mistake
- 2) misrepresentation
- 3) coercion
- 4) undue influence
- 5) lack of capacity
- 6) failure of consideration
- 7) illegality
- ** all of these are problems with formation.
Rescission: Grounds - Mutual Mistake
- Material Mistake: Rescission Granted.
- Collateral Mistake: If the mistake was collateral (going to quality, desirability, or fitness for a particular purpose) --> Rescission Denied.
Rescission: Grounds - Unilateral Mistake
- General Rule: Rescission denied
- 1) If the non-mistaken party knows or should know of the mistake, rescission will be granted (different from unilateral mistake defense in reformation).
- 2) Modern Trend Exception: Rescission will be granted if the mistaken party would suffer an undue hardship if rescission were denied.
Rescission: Grounds - Misrepresentation
Rescission Granted - P must show that he actually relied upon the misrepresentation.
- 1) Unclean Hands
- 2) Laches
: Plaintiff's negligence will not serve as a defense.
Rescission: Availability of Restitution
If P who is entitled to rescission has previously rendered performance on the K, he can be compensated for it or get the property back via restitution.
- Definition: Changes written agreement to conform with the parties' original understanding.
- 3-Step Analysis (Mnemonic: "Very Good Dog"):
- 1) Valid K
- 2) Grounds for Reformation
- 3) Defenses
- 1) Mutual Mistake = reformation granted
- 2) Unilateral Mistake = reformation denied unless the non-mistaken party actually knew of the mistake (no 'should-have-known' exception).
- Misrepresentation = reformation granted for innocent and intentional misrepresentations.
- 1) Unclean Hands
- 2) Laches
Note - reformation is not allowed
where it would adversely affect the rights of a subsequent bona fide purchaser.
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