Tiersma, Remedies, Fall 2005
I. INTRODUCTION TO REMEDIES
A. Overview- Remedies are concerned w/the nature and the measurement of relief to which a party may be entitled. A person must establish (1) a violation of a substantive right AND (2) the basis for any desired remedy. If someone asks for both legal and equitable remedies in same action, they will be adjudicated separately if legal ones require a jury.[.1]
1. Juries- Equitable courts generally don’t have juries, so if you ask for an equitable remedy, you may lose your right to jury trial.
2. Ubi remedium, ibi jus- Where there is a remedy there is a right (law). The idea is that if there is no remedy, you don’t really have a right.
B. Types of Remedies- There are 4 main kinds:
1. Coercive Remedies- Prospective Remedy against the Person that is EQUITABLE and backed by Contempt Defense. Can be obtained BEFOREtrial, before forming a cause of action.
a)Injunction- generally tells someone they must do something
(i) Preventive- directly prevents anticipated harm from happening (directly aimed at potential harm)
(iii) Restorative- operates to correct the present by undoing the effects of a past wrong. It focuses both prospectively AND retroactively (fix the damage)
(iii) Prophylactic- safeguard P’s rights by directing D’s behavior so as to reduce the possibility of future harm (less direct than preventive)
(iv) Structural- These regulate an entire institution and involve cts in institutional policies and practices of defendant entities.
b) Specific Performance- requires performance of what person in K originally promised.
2. Damages-(these focus on P’s loss of $) You must WIN your cause of action to get these.
a)Compensatory- These compensate plaintiffs for the losses sustained in violation of their rights
b) Punitive/Exemplary- these are designed to punish and deter wrongdoers in cases involving egregious conduct.
c) Limits-
(i) CERTAINTY- E.g. a contest host gives answers to 1 contestant; can other contestants sue? No probably not, b/c hard to estimate amt. of damages to give them.
(ii) MITIGATION- person wronged must try to compensate for loss or avoid more if they can.
3. Restitution- (focuses on D’s gain, NOT a compensatory remedy)This restores property to its rightful owner by returning the P to a position held before wrong occurred OR disgorges a D from any unjust enrichment occasioned by the wrong.[.2]
(a)Legal-
(i) Replevin[.3]
(ii) Quasi-K
(iii) Common Counts-
(b) Equitable-
(i) Constructive Trusts
(ii) Equitable Liens
HYPO:
If an embezzler purchases land with misappropriated $, he can’t keep any $ profits from land. Thus a P may receive land by constructive trust and $ profits, even if more than embezzled since D will not be allowed to profit at all from his intentional wrong.
4. Declaratory Relief- (purpose is to obtain a declaration of rights or legal relations btwn the parties).
(a) Limits- Cause of axn must be ripe for adjudication
HYPO:
What are the rights for an income tax deduction? You can’t declaratory relief to determine your rights, b/c most judges will say that you must take a deduction first, and then be wronged for the issue to be ripe.
HYPO: (Done for procedural benefit)
If the IRS is coming after you, they may want declaratory relief and makes it a P instead of a D.
PROBLEM: THE WASTE LAGOON (p.6)
Jim and Joan Pollard own a farm on which they grow feed corn. A few years ago Krystal Refining Co. constructed wastewater lagoons on the land adjacent to the Pollard’s farm land. Last year, the Pollards began experiencing crop looses on the strip of land immediately adjacent to the Krystal Refining lagoons. Although the crops on other fields did very well that year, the corn in the field adjacent to the lagoons did very poorly. The Pollards hired a soil analyst, who informed them that a new chemical recently introduced into Krystal’s refining process has seeped from the wastewater lagoons into the soil on the Pollard’s land. This chemical was responsible for the poor crop last year. Moreover, the expert informed the Pollards that the increased presence of this chemical may not have irreversibly precluded that strip for any farm cultivation. Only expensive add’l testing could determine the permanency of the damage.
Legal Remedies:Assuming the Pollards can establish a cause of action against Krystal Refining, what should be the available remedies? First, consider that the damage to the land may be reversible, but only at an enormous cost. Should the high cost of restoration be the measure of damages? What if the amt. exceeds the FMV of the land? Would it matter if the Pollards depended upon farming for their livelihood and there were no other acres for sale in the vicinity? If the court rejects the cost of restoration as the measure of damages, what are the alternative measures?
The cause of action will be trespass or nuisance and remedies could be:
1)Value of damaged crop or reduced crop for the last year? You would probably want to know how much corn they got in previous years, vs. the first year that suffered a reduced yield. Last year they got 5K bushels. You can take an avg. of 10 years. Over the previous years, they got about 8K for that land. They’re getting 3K bushels per acre less, then multiply by number of acres affected etc OR You can also say this is a great year, by the other farms around, e.g. 10K this year.
2)They may also want to get future damages- Ct will normally not grant these; but liquidated damages clause might be written into a K.[.4]
3)They could try stopping this from happening in the future- They would need an injunction.
4)They could get punitive- Doesn’t hurt to ask for these, even if you don’t get them. These are normally only given when conduct is “intentional or outrageous.” Here it doesn’t seem that the conduct was intentional. They didn’t seem to know or intend that chemicals seeped over into the lands. Is it outrageous? It depends on whether they knew it was happening, this would be easier to prove.
5)Clean up Cost/Restoration to Original Condition/Reduced Value of Land/Permanent Loss to Property- If the chemicals decompose, it would be a temporary loss only. If it’s permanent and stays in the ground and affects all future corn costs, you’re like to get clean up costs OR reduced value of land, normally NOT both as they are alternatives. Sometimes it’s less expensive to get reduction in value, so cts. will give that instead of clean-up.
6)Attorney’s Fees/Costs- American rule is that each party bears its own costs where English party picks them up.[.5]
PROBLEM: THE STUDENT PROTESTER (p.10)
Assume that you have recently graduated from law school, passed the bar exam, and opened a law office w/some friends in a small university town. You hear the following story on 6 o’clock news. “Students at the University are protesting the quality of dormitory food. There was a noon rally on this subject today which became a rather rowdy demonstration.” The camera then showed a taped interview w/the student who organized the rally, Ken Maxwell, who announced that the 2nd demonstration was planned for that evening. He said that the protest march would happen and that all students should assemble w/tonight’s dinner tray of dormitory food. Maxwell said that they would march on the home of the University president and leave their evidence (the trays of food) on the lawn. Immediately after you see the story on the news, the phone rings and the caller is Maxwell. He tells you that he was just served w/an order signed by a state court judge which forbids him from holding the rally, encouraging others to demonstrate tonight, and from “contributing to or inciting any breaches of the peace” in the town in the future. His answers to your questions lead you to the conclusion that the city and University successfully sought an ex parte injunction against Maxwell. Maxwell says that he has an undergrad course in Con law and knows perfectly well that “they” cannot keep him from speaking and petitioning the president of the University. Nonetheless, Maxwell says that a friend urged that he call a lawyer before running off to the rally. The rally is due to take place in a few minutes. What do you say? Who else may be bound by the court’s order? What if Maxwell’s friends demonstrated and stayed home?
We can say that this may violate the 1st AM, but since it’s a court order, you may be subject to criminal prosecution, even if the order is unC.
PROBLEM: THE LOTTERY WINNER (p.10)
You are engaged in a law practice w/an office that hires several part-time workers. One of the part-time workers was out of cash immediately before payday and wrongfully took some money from petty cash to buy lunch and to purchase a lottery ticket at the restaurant. As luck would have it, the lottery ticket was a big winner. Assume that the theft is proven and that the use of the office money for the purchase of the lottery ticket is clearly traced. Should the law partnership be able to recover only the amt. taken from petty cash or the full amt. of the lottery winnings?
- This is clearly conversion a TORT and a crime.
- How much does the law firm get? The 1$ or the 1K?[.6]
This will depend on what type of remedy they are entitled to. If they are entitled to restitution, then the firm will get 1K b/c we look at the gain of the D.
- If we give them damages, the P’s loss is $1
C. Limitations on Remedies- There are 3 sources of remedial rights (1) statutes, (2) federal and state C’s and, (3) CL. A source important b/c:
(a) P must establish that remedy is permissible AND
(b) Source may place limitations on remedy
1. Statutes-Generally when a statute lists remedies, no others can be added and often a statute will limit the remedy it lists. But sometimes states will award extra, if they fall w/in LEG purpose of statute.
a) Exception- It will not eliminate a CL cause of action
b) MINORITY RULE- § will not exclude remedies.[.7]
Applied in ORLOFF v. LA TURF CLUB[.8]
Facts:A man is excluded improperly from the Club. The statute says that he can recover actual damages. The D argues under statutory construction that when a new right is created by statute, a statutory remedy is exclusive of all others.
Conclusion: CA DISAGREES: They want the statute to be “liberally construed with a view to effects its objects and to promote justice.” They say that interpretation of the statute requires evaluating the adequacy of the remedy provided in the statute. They think the $ damages are inadequate here for the type of harm done, so they allow injunction though not provided for in the statute.
Applied in IL Statute (Alteration OKAY, Elimination NOT)
Legislature decided to eliminate old CL for alienation of affections, and passed a “Heart Balm” statute eliminating torts for domestic relations. The IL SC held that a state statute could not eliminate an existing CL right, but then legislature rephrased act saying it didn’t ELIMINATE, only restricted to “actual damages.” IL SC upheld legislative changes saying it was an “alteration” of a remedy rather than elimination of CL right.
PROBLEM: THE FIRED NURSE[.9]
Nurse is humiliated in public when she refuses to do something against her religious beliefs which were supposedly protected. The protective Act says, “no person engaged in the delivery of medical services may be discriminated against by reason of refusal to act contrary to individual conscience.” The court may enjoin discrimination provided by act and may order affirmative relief as may be appropriate which may include reinstatement of employees w/o back pay or w/backpay, or any other equitable relief ct deems appropriate. Nurse doesn’t want reinstatement but asks for:
1)Injunction against further discrimination- THEY WILL GRANT THIS
2) Damages for humiliation and ED- WON’T GRANT NOT EQUITABLE
3) Damages for being out of work- WON’T GRANT, NOT EQUITABLE
4) Atty’s costs- WON’T GRANT, NOT EQUITABLE
2. Equitable Defenses
Applied in COWIN EQUIP (Categorization of doctrine is important)
Facts:Cowin buys heavy equipment from GMC and tries to cancel some of those ordered. When GMC refuses to cancel, Cowin argues unC of K, and wants (1) interest on loans taken out to buy extra equipment (2) insurance on equipment (3) storage fees and (4) loss of having to sell below market.
Conclusion: Ct finds that even if K was unCthe UCC didn’t intend to create a cause of action, so you can’t have a remedy w/o an underlying cause of action. It’s an EQUITABLE DEFENSE and undermines a cause of action BUT is not one itself.[.10]
3. Jurisdictional Limits- Congress can pass acts that remove jdx’l authority from a court to order injunctions or TRO’s etc.
Applied in NORRIS-LaGUARDIA Act (historical reasons)[.11]
They did this in 1932 by Norris-LaGuardia Act to prevent courts from imposing “get back to work” injunctions during labor disputes – non-intervention policy. But later on, the courts decided that times were different when this was passed and intervention is good when there is an interest in the SUCCESSFUL IMPLEMENTATION of the arbitration process.
4. Private Ass’ns/DP
Applied in TRIESTER v. AM. ACADEMY (Not in private unless economic)
Facts: P files a 3 count complaint against D challenging their denial of his admission to membership in academy. P says that he must have membership in academy to enjoy several privileges of the profession. P asks (1) declaratory relief that he can be informed of charges against him and identity of his accusers, and fair hearing etc.etc. He also asks (2) for a w/drawal of rejection. D argues ct has no JDX over decisions of a private professional assoc.
Conclusion: Ct balances the need to NOT get involved in private affairs against right of individual to practice in his profession w/o discrimination. They say they CAN get involved when the private org’s decision has economic necessity.
Policy- Here the remedy is OVERBROAD, the ct. will only allow this cause of action in[.12] certain circumstances otherwise will have to get involved in every little thing that goes wrong in private orgs. And ct. will be forced to give DP for too small of things.
Dissent- Though he is on staff now, non-membership in academy will always be a red flag and thus this will be economic.
5. Judicial Immunity- This bars only damages NOT injunctive relief.
Applied in PULLIAM v. ALLEN (No damages against judge acting in off capacity)
Facts:P’s argued that MAG Pulliam’s practice of imposing bail on persons accused of non-jailable offenses and then incarcerating them if they couldn’t meet bail was unC. After being put in jail for unpaid bail, P brings 1983 claim seeking declaratory and injunctive relief.
Analysis: Generally judges are immune, and in CL there was no injunctive relief in regular cts b/c they are equitable. However, the circumstances warranting injunctive relief (showing of inadequate remedy at law and risk of irreparable harm) outweigh risk that judges will be harassed by disgruntled litigants
Conclusion: judicial immunity is not a bar to prospective *injunctive relief* against a judicial officer acting in her judicial capacity, but is a bar to damages.
D. Characterization of Remedies- Generally equitable remedies are appropriate only where legal remedies are inadequate or non-existent. Classification can affect right to jury trial, insurance coverage etc.
1. Equitable vs. Legal- Characterized by historical origin
a) Legal- developed through CL forms of action and are largely judgments for $ to compensate P’s for loss or injury.
b) Equitable- Developed in Ct. of Chancery; generally specific and impose personal obligations or duties on D; can be prohibitive or affirmative.
Applied in MD CASUALTY v. ARMCO[.13]
Facts:Armco is accused of practices resulting in environmental spills w/toxic wastes. They want $ for that spent to clean up and investigation etc. MD seeks declaratory judgment concerning its liability to insured, Armco, Inc.Ordering Armco to remediate would be coercive so also not covered by policy.
Conclusion: This is not a claim for damages and MD not obligated to indemnify nor defend Armco in MO litigation because asking for money spent to clean up is like restitution as govt. is fixing a problem.Insurance policy covering damages (compensation for injury) will not be interpreted to cover restitution (prevention of unjust enrichment) for gov’t performing environmental clean-up
HYPO: (damages)
Prof drunk on coke and he falls on Leah’s orchid. If she sues to get compensated for injury caused to her.
This is damages.
HYPO: (restitution)
Let’s say Leah is on vacation and again Prof damages the orchids, but Orchid society member goes to Orchid store and finds the same Orchid, spends 100$ and plants it in the garden. That person now sues Prof saying he killed the Orchid, and I spent money. I want to be compensated.
Now this is restitution, b/c friend has conferred a benefit on Prof by fixing a problem that Prof is legally responsible for.
c) Quasi-Contract- sometimes can be legal and sometimes can be equitable.[.14]
d) Front Pay & Back Pay-
(i) “Front pay” & “Back pay”: equitable remedies (although $), b/c they are part of “reinstatement”
(a) Back pay: money awarded for lost compensation during period up to the time of judgment
(b) Front pay: money awarded for lost compensation during period btwn judgment and reinstatement or in lieu of reinstatement.
Applied in BRUNECZ ((How you characterize a remedy, can affect the type of trial)
Facts: P brings suit for wrongful discharge. P alleges that he was injured at place of employment and D wrongfully discharged b/c he filed a claim of compensation. Arbitrators find for P. P claims that since his action was for $ damages, he should get a jury trial, D argues no.
a)Reinstatement- this is coercive, give job back, so equitable.
b)Backpay- compensation for a loss, it’s part of reinstatement, so coercive as well and thus equitable.