contracts: april 15 2010 class notes.

remedies recap.

the hydraform case about the stoves. the american was late in its delivery and selling defective steel to hydraform. there was a clause that proported to limited consequential damages. the lower court found the clause to be unconscionable. assuming consequential damages, how far do they go? souter said that the consequential damages ruling, though it goes beyond the clause, is still limited: all that hydraform can get is lost profits on the 150 stoves it didn't sell because american steel was late and provided defective steel. it can't get diminished business value.

bohac v. dep't of agriculture.
not a contracts case, but the appellate court is looking at the meaning of consequential damages and making an inquiry into whether they include nonpecuniary losses. consequential damages does not cover nonpecuniary losses. sharfman calls it the "undertaker's exception": see p.1060 for the restatement... if you do something reeeeeally anguishing like messing up on a body, and that causes grave (haha) emotional disturbance, you may be covered by the remedies doctrine. also innkeepers and carriers are covered.

in the long island case of broken engagement, the court held damages for nonpecuniary loss was not a legally cognizable mental anguish for contract breach remedy.

acquista may be an exception to where nonpecuniary losses may be allowed remedy.
plantiff is seeking damages in excess of the insurance company limits of payout. the theory is that there is some sort of nonpecuniary/emotional/nonfinancial losses associated with the denial of coverage.
the case gives some theories: maybe the doctor was deprived of medical treatment or other therapies that would have made his life better, and now he's suffered damages because of the lack of treatment. this opens the door to a tort claim via contract law: "why not just bring a tort claim here? there's a claim of emo distress and loss of opportunity?" sharfman says that in torts you have IIED but here even if it wasn't intentional, you stillhave rise to distress even without intention, just need breach or unconscionability or reliance under contract.

guy got the car and made payments. then realized the new car was used. stopped payments, and car dealer sued. common law rule: you don't get punitive damages. but this is a case where defendant got them on counter claim. the general rule for punitive damages is that they must have some reasonable relation to the compensatory reward. what does reasonable mean? sharfman says he doesn't know but that it could be like a ratio: J. Kennedy says that a ration more than 10/1 is too high and without due process.

money from amco would not work here because there's some losses to lackleed in this trailer park are dependent on the gas. they would have a claim, and that could potentially not be foreseeable to amco and so the compensatory would not be full under hadley and so amco would be held to specific performance.

go ahead and breach and pay: the economic doctrine under posner
here in walgreens case, the landlord wants to breach the lease and rent to another pharmacy. the landlord wants to pay damages and walgreens wants an injunction because the monetary damages would under compensate. posner was happy with the lower court. for our purposes: if you can come up with the arguments for why the money remedy is likely to under compensate then you're in inadequacy at law territory in which case specific performance/injunction could definitely work. you can try to calculate what walgreens profits would be against pharmor's but there's nothing certain to that about the loss. though it's unclear as to the loss it still is reasonable that the money would undercompensate.

notes: injunction goes pretty far -- the contractor who hasn't even begun to build the mall yet is ordered to build it.

negative injunction case: abc v. dick wolf
this is a labor/employee contract. you can't force someone to perform on an employment contract. you might owe damages, but there's no specific performance. wolf doesn't want to go forward with abc, but instead wants to move to cbs and abc wants a negative injunction to make wolf unable to work for cbs. can't as someone to perform specifically under an employment contract but you can get an injunction to keep them from working with someone else. losses: loss of advertising, loss of viewership, etc.

property law: april 15 2010 class notes.

land use in the form of equitable servitude:
restrictions and controls of common interest entities and what those interests over the group can be.
* internal fees/ taxes
* restriction to behaviours and life choices
* restriction to use of land (aesthetic regulations,
* deciding who may live in the community


zoning.
is this the kind of authority that we have given our governments?
euclidean zoning

village of euclid v. ambler realty 272 US
the village of euclid had a zoning system. ambler decided to challenge under the 14th amendment: the land i own is more valuable as industrial land, but the use zones don't allow industrial use and so you have taken my property by diminishing its value (this is kind of like the south carolina beach front reclamation case)
what else could ambler do to reclaim the value and use on its property? it could have asked the city for a zoning variance
why didn't ambler do this? want the constitutional issue decided
wouldn't they have been in a better position if they had applied for a variance
the entire scheme of having to check with the gov't before use is an element of the lack of DP under the law.

con -- deprevation of property in violation of 14th amd't, or of just compensation under 5th amd't
pro -- the burden is not so great, there is a DP exception of the variance; it is an extension of the police power to protect citizen's health, wealth and privacy

          the legislature is protecting the privileges of the residents of the community who might be affected by non residential uses of neighboring land.
so what's the dispute? you have the right to enjoy your own property until it burdens someone else's use of their property
how does that work in this situation? the residents who want to use their land residentially would be burdened by the industrial use of the land and the interest in their property would be impaired (see H1)
what's the opposite argument? you're allowing residents to live here is burdening my use of this land, which is so perfectly made for industrial activity, and you
who gets to decide??? why not say landowners get to decide? why not say the market gets to decide? what's wrong with letting the market sort out these disputes?

land use exists to separate and distinguish.

why not combine the residential, suburban and industrial uses of lands? why not impose
what is the issue of fire and traffic in this case? the children!! think of the children!!

what do we need to save the children?
- traffic regulations,
the zoning ordinance, by restricting these traffic and industrial uses, improve the environment for children. and what is the best for the children?
- single family home (U-1): all else is in service to that
- U2 is also a residential zone... two-family homes
- U3 is apartment buildings
what's the problem with putting all the residential properties together? because apt's are "parasites" and they "soak up the sun" and create noise and increased business, impair safety... density brings danger
if the guiding principle is that you must use your land so as to not injure another's use of his land, and we take as a measure against injury of the single-family home, it is inherently bad because

the single family home: why do we let the single family homeowners decide?
there are values that are given up by moving industry very far from residences, as well.

why can't we look to the judiciary branch to

how do weigh the interests of the community against those of the private landowner? in equity, there's not enough

where have we drawn a distinction between the system of rules and the application of those rules to an individual? nahrstedt: where the court said, the rule doesn't take into account your individual experiences, we're going to look at the rule as to its effect on the community as a whole and defer to the community's ability/desire to govern itself and give it the benefit of the doubt.

here, the community is the state via police power and it has given the village of euclid the power to enact a zoning ordinance, and the court says it's not its job to have to regulate balancing of those interests in the community. that's what legislatures do. this is a separation of powers problem.

the only question we have to ask is if the system of restrictions is reasonable v. arbitrary, just as in nahrstedt. justice stevens comes up with a lot of reasons... if you can come up with those reasons, then the zoning is probably ok. these are the days before strict scrutiny and rational basis, but this reasoning is closest to rational basis.

and so, now we have this...

is this ok that we set up our communities this way on purpose?

compare robert moses and jane jacobs, and the argument that saved greenwich village.

zoning ordinances reflect the attitudes of the community, and what we want our physical world to look like. after euclid, it is clear: these discussions do not take place in the courts, they take place in the community and are enacted through the legislature.

this can lead to problems and limitiations on use however. problems impacted by circumstances not covered by the zoning itself. but there are two possibilities not in line with the zoning ordinances:
1. variance.
2. forebearance, such as grandfathering in zoning ordinances or permitting certain uses neither permitted nor forbidden to continue/begin if certain conditions are met
3. individual dispensation, as we will see in commons...

commons v. westwood zoning board of adjustment

the commons own a parcel of land but the zoning ordinance says that you can't own a home on a parcel of land under a certain size. there also has to be a certain frontage for what faces on the street. the lot is just too small for a house. the commons try to sell the land and that doesn't work. the neighbors aren't willing to sell to enlarge the property. the neighbors won't buy at a fair price. then they petition for a variance, stating an established hardship and the city zoning board finds that a) the commons didn't establish the necessary hardship and b) granting them a variance would substantially impair the intent/purpose of the zone planning because they say so. the commons appeal to the new jersey supreme court...

state v. shack is an NJ case
NJ coalition against the war case
public dust trust case
... NJ is a hotbed of progressive judicial rule

the court looks at the statute and determines what the zoning board has to consider, positive and negative criteria (and the party has the burden for both)

1. (negative) undue hardship
2. (positive) the variance would not be detrimental to the public good nor impair the intent/purpose of the zoning scheme

how do we know if there's an undue hardship? how do we determine this?
* did the property owner create/self-impose the hardship (put himself in a nonconforming position)
* efforts that the property owner makes to bring the property into compliance

in this case...

point 1, the negative:
     at the time the lot came into being, the size restrictions were not in place.
     the zoning arose after the parcel was designed. and that is a finding in favor
     of undue hardship, because the appellant didn't create the position.

     secondly, the commons tried to sell and the neighbors lowballed to the value.

     the court considers the property with a variance: why is it doing that???
     to make sure that the land has some value in light of the holding.

     but absent a variance, is the land unfit for effective use?
     there are houses in the area that are on parcels of land this same size but
     they are before the zoning ordinance. that shows that the land could
     be used for the physical conditions of the land. is it reasonable to tell
     the commons that they cannot build?

point 2, the positive:
     the house being proposed would be in the same range as other houses in the neighborhood, thereby it would not bring down the value of the other homes in the area. why would we allow certain interests to outweigh the others? why should we allow the community to say, "sorry, we've already established our homes and our aesthetic and we don't want to allow you to change it?" what if we decide we just... don't like our neighbor's house?
so why do we ever allow conditions where there is an undue hardship such as this? should the burden always be on the nonconforming owner? in reality, there is the same effect as if there had already been a taking.

are the negative criteria met? we don't know. because the court said that both parties needed mroe evidence -- zoning board was conclusory, and the facts alone are not sufficient for a determination.

in both euclid and commons, there is a foresight to eminent domain...

imagine a situation where the community says, "sure our decisions are gonna take away the value of your land." in this kind of regulatory taking, there may be a constitutional issue under 5th and 14th amd't issue, and the gov't may be required to provide fair compensation for the taking.

next week, we're looking at the question of whether or not the neighbors/community bear the burden of noncomformity. if zoning ordnance imposes a burden on a nonconforming parcel, but we find that the parcel is an undue hardhsip on the community, the public will take. the public at large will get a benefit from the improved land but will have to pay for it... that may not be a good thing.
eminent domain.

takings: p. 941-1025, 1042-1059