1
00:00:00,040 --> 00:00:03,640
Welcome to the Deep Dive for all
your future legal eagles out 

2
00:00:03,640 --> 00:00:05,120
there. 
We know you're deep in the 

3
00:00:05,120 --> 00:00:07,920
trenches right now grappling 
with just mountains of 

4
00:00:07,920 --> 00:00:11,640
information for the bar exam. 
It's it's a real marathon. 

5
00:00:11,720 --> 00:00:14,480
It definitely is. 
But today, we're here to cut 

6
00:00:14,480 --> 00:00:17,160
through some of that noise. 
We want to deliver the essential

7
00:00:17,160 --> 00:00:21,240
Nuggets you need to really 
master 3 foundational and, let's

8
00:00:21,240 --> 00:00:24,880
be honest, heavily tested 
subjects, business associations,

9
00:00:24,880 --> 00:00:28,440
advance contracts, and UCC sales
and Civil Procedure. 

10
00:00:28,560 --> 00:00:32,439
That's absolutely the plan. 
Think of this deep dive as your 

11
00:00:32,439 --> 00:00:35,240
direct route to understanding 
the really critical nuances in 

12
00:00:35,240 --> 00:00:37,720
these areas. 
Our mission today is to clarify 

13
00:00:37,720 --> 00:00:40,760
those key distinctions that 
always seem to pop up, demystify

14
00:00:40,760 --> 00:00:43,600
some complex rules, and frankly,
equip you with the strategic 

15
00:00:43,600 --> 00:00:46,720
mindset you need to nail those 
MBS and MB ES. 

16
00:00:46,720 --> 00:00:49,000
Yeah, we want to turn those 
moments of confusion into 

17
00:00:49,120 --> 00:00:52,600
genuine. 
Aha moments give you that edge. 

18
00:00:52,600 --> 00:00:54,960
Exactly. 
A focused high yield study 

19
00:00:54,960 --> 00:00:57,520
session right here. 
And to make sure this really 

20
00:00:57,520 --> 00:01:00,920
sticks, we're pulling insides 
directly from your core bar. 

21
00:01:00,920 --> 00:01:04,680
Re materials, we're looking at 
Lecture 7 on advanced contracts 

22
00:01:04,680 --> 00:01:08,680
and UCC sales, Lecture 8 on 
business associations, and 

23
00:01:08,680 --> 00:01:11,040
Lecture 9 covering Civil 
Procedure fundamentals. 

24
00:01:11,240 --> 00:01:12,400
Right. 
But we're not just sticking to 

25
00:01:12,400 --> 00:01:14,640
the lectures. 
We've also woven in insights 

26
00:01:14,640 --> 00:01:18,280
from targeted Mee analysis, key 
Federal Rules of Civil 

27
00:01:18,280 --> 00:01:22,360
Procedure, and some crucial 
distinctions from sources like 

28
00:01:22,360 --> 00:01:25,560
accounting for partnerships and 
goat bar prep on specific points

29
00:01:25,560 --> 00:01:28,080
like UCC remedies and 
partnership law. 

30
00:01:28,520 --> 00:01:30,840
The goal here is really to 
connect all these dots for you, 

31
00:01:31,120 --> 00:01:33,880
make the information resonate 
just like it would if you were 

32
00:01:33,880 --> 00:01:36,720
hashing it out with professors 
or maybe seasoned lawyers. 

33
00:01:37,040 --> 00:01:40,120
So let's just jump right in. 
OK, let's kick things off with 

34
00:01:40,120 --> 00:01:42,600
the entities that really form 
the backbone of commerce 

35
00:01:42,920 --> 00:01:45,880
business associations. 
Whether you end up advising a 

36
00:01:45,880 --> 00:01:48,640
small startup or a huge 
corporation, understanding who 

37
00:01:48,640 --> 00:01:52,200
acts for whom, how liabilities 
get shared and what duties are 

38
00:01:52,200 --> 00:01:54,960
owed, it's absolutely critical. 
Couldn't agree more. 

39
00:01:54,960 --> 00:01:58,000
It's not just for the exam, it's
for your whole career and the 

40
00:01:58,040 --> 00:02:00,400
absolute first building block 
here. 

41
00:02:00,400 --> 00:02:03,160
The foundation for everything 
else is agency law. 

42
00:02:03,520 --> 00:02:06,000
Right Agency. 
It defines that relationship 

43
00:02:06,000 --> 00:02:10,639
where one person, the agent, 
acts on behalf of and is subject

44
00:02:10,720 --> 00:02:13,000
to the control of another, the 
principal. 

45
00:02:13,000 --> 00:02:15,440
Exactly. 
And from my experience, you 

46
00:02:15,440 --> 00:02:17,800
know, both studying and talking 
with practitioners, this 

47
00:02:17,800 --> 00:02:21,640
relationship underpins so much. 
Agents are the intermediaries in

48
00:02:21,640 --> 00:02:25,200
almost every transaction, 
operation, contract formation, 

49
00:02:25,520 --> 00:02:27,480
you name it. 
What's always struck me as 

50
00:02:27,480 --> 00:02:31,280
interesting, especially for the 
bar exam, is how informal agency

51
00:02:31,280 --> 00:02:33,680
creation can be. 
You know, we often think 

52
00:02:33,680 --> 00:02:35,720
contracts need to be in writing,
right? 

53
00:02:35,880 --> 00:02:38,400
But for agency, you don't 
necessarily need a written 

54
00:02:38,400 --> 00:02:39,600
agreement, do you? 
Yeah. 

55
00:02:39,760 --> 00:02:42,440
Unless maybe the statute of 
frauds kicks in for something 

56
00:02:42,440 --> 00:02:45,240
specific like real estate or a 
contract over a year. 

57
00:02:45,280 --> 00:02:48,720
That's a huge point and a 
classic exam trap agency can 

58
00:02:48,720 --> 00:02:52,320
arise just through conduct, no 
formal paperwork needed in many 

59
00:02:52,320 --> 00:02:54,440
cases. 
So how does it actually happen? 

60
00:02:54,440 --> 00:02:56,280
What are the core elements you 
need to spot? 

61
00:02:56,440 --> 00:02:58,560
Yeah, what should you be looking
for in a fact pattern? 

62
00:02:58,720 --> 00:03:02,680
OK, so lecture 8, drawing on 
just general agency principles, 

63
00:03:02,960 --> 00:03:06,680
highlights 3 core components. 
First, you need consent. 

64
00:03:07,080 --> 00:03:10,400
Both the principal and the agent
have to agree and that can be 

65
00:03:10,400 --> 00:03:13,120
expressed like saying you're my 
agent or implied from how they 

66
00:03:13,120 --> 00:03:14,760
act. 
OK, consent makes. 

67
00:03:14,840 --> 00:03:17,400
Sense Second, the agent's 
actions have to be for the 

68
00:03:17,400 --> 00:03:19,760
benefit of the principal. 
Their conduct is directed 

69
00:03:19,760 --> 00:03:21,440
towards the principal's 
interests. 

70
00:03:22,440 --> 00:03:25,640
And 3rd, and this is often the 
key differentiator, the 

71
00:03:25,640 --> 00:03:28,600
principal has to have control 
over the agent's conduct. 

72
00:03:29,080 --> 00:03:32,000
This element of control is what 
really distinguishes an agent 

73
00:03:32,000 --> 00:03:33,920
from, say, an independent 
contractor. 

74
00:03:34,360 --> 00:03:37,080
With an independent contractor, 
the principal usually just 

75
00:03:37,200 --> 00:03:39,800
controls the result of the work,
not the how. 

76
00:03:39,880 --> 00:03:41,920
That control element seems 
crucial. 

77
00:03:42,280 --> 00:03:44,960
So OK, once we have an agency 
relationship, the next big 

78
00:03:44,960 --> 00:03:48,360
question, especially for the 
exam, is about authority. 

79
00:03:48,720 --> 00:03:52,320
Does the agent actually have the
power to bind the principal? 

80
00:03:52,680 --> 00:03:54,320
Right. 
And we generally talk about two 

81
00:03:54,320 --> 00:03:58,120
main types of actual authority. 
First is express actual 

82
00:03:58,120 --> 00:04:00,320
authority. 
This is the clearest kind. 

83
00:04:00,640 --> 00:04:04,360
The principal explicitly grants 
the agent power, maybe orally, 

84
00:04:04,360 --> 00:04:07,960
maybe in writing, to do a 
specific thing, very direct, 

85
00:04:08,040 --> 00:04:10,600
simple enough. 
Then there's implied actual 

86
00:04:10,600 --> 00:04:12,120
authority. 
This is what the agent 

87
00:04:12,120 --> 00:04:15,080
reasonably believes they have 
based on their position or 

88
00:04:15,080 --> 00:04:17,959
what's necessary or customary to
carry out that express 

89
00:04:17,959 --> 00:04:19,880
authority. 
Think of a store manager. 

90
00:04:19,880 --> 00:04:23,040
They probably have implied 
authority to hire staff, it's 

91
00:04:23,040 --> 00:04:24,960
just part of running the store. 
That makes sense. 

92
00:04:25,520 --> 00:04:29,280
But then we get to a parent 
authority and then this, you 

93
00:04:29,280 --> 00:04:31,960
know, this feels like where it 
gets tricky for students, myself

94
00:04:31,960 --> 00:04:34,600
included back in the day. 
It's not about internal 

95
00:04:34,600 --> 00:04:36,680
agreements, is it? 
No, exactly. 

96
00:04:36,680 --> 00:04:38,680
It's all about the third party's
perception. 

97
00:04:38,800 --> 00:04:40,360
That's why it's so heavily 
tested. 

98
00:04:40,800 --> 00:04:44,000
If the principal's conduct leads
a third party to reasonably 

99
00:04:44,000 --> 00:04:48,240
believe the agent has authority,
the principal is bound, even if 

100
00:04:48,320 --> 00:04:50,440
internally the principal said 
don't do that. 

101
00:04:50,760 --> 00:04:53,120
So how is that apparent 
authority created? 

102
00:04:53,120 --> 00:04:54,800
What kind of principal condit 
are we talking about? 

103
00:04:55,000 --> 00:04:57,880
It can happen in a few ways. 
Maybe the principal gives the 

104
00:04:57,880 --> 00:05:00,880
agent a title like Vice 
president of sales, which 

105
00:05:00,880 --> 00:05:04,960
suggests certain powers. 
Or it could be through past 

106
00:05:04,960 --> 00:05:08,120
dealings if the principal 
consistently allowed the agent 

107
00:05:08,120 --> 00:05:11,480
to do something before the third
party might reasonably assume 

108
00:05:11,480 --> 00:05:14,560
they still can. 
Or even direct statements from 

109
00:05:14,560 --> 00:05:16,200
the principal to the third 
party. 

110
00:05:16,800 --> 00:05:19,280
The key is always the 
principles, manifestations 

111
00:05:19,320 --> 00:05:22,240
outward to that third party. 
OK, so principles, actions, 

112
00:05:22,240 --> 00:05:24,680
creating reasonable belief in 
the third party. 

113
00:05:24,960 --> 00:05:27,560
What about ratification? 
It sounds like a way for the 

114
00:05:27,560 --> 00:05:31,160
principle to sort of clean up a 
mess after the fact. 

115
00:05:31,160 --> 00:05:34,000
That's a good way to put it. 
Ratification is when a principal

116
00:05:34,000 --> 00:05:37,000
knowingly affirms an 
unauthorized act after it's 

117
00:05:37,000 --> 00:05:39,520
already happened. 
They essentially adopt the ACT 

118
00:05:39,520 --> 00:05:41,120
as their own. 
How does that affirmation 

119
00:05:41,120 --> 00:05:43,280
happen? 
It can be expressed, yes, I 

120
00:05:43,280 --> 00:05:46,600
agree to that contract the agent
signed without permission, or it

121
00:05:46,600 --> 00:05:50,440
can be implied through conduct 
like knowingly accepting the 

122
00:05:50,440 --> 00:05:52,280
benefits of that unauthorized 
deal. 

123
00:05:52,280 --> 00:05:54,360
But the principal has to know 
what happened, right? 

124
00:05:54,520 --> 00:05:57,520
Absolutely critical. 
The principal must know all the 

125
00:05:57,520 --> 00:06:00,840
material facts surrounding the 
unauthorized act and must have 

126
00:06:00,840 --> 00:06:03,720
had the capacity to authorize it
at the time it occurred and at 

127
00:06:03,720 --> 00:06:07,040
the time of ratification. 
You see this pop up on exams 

128
00:06:07,040 --> 00:06:10,160
where an agent oversteps, but 
the principal gets the benefit 

129
00:06:10,160 --> 00:06:12,640
and doesn't repudiate it. 
That can be ratification. 

130
00:06:13,240 --> 00:06:17,400
OK, so we figured out if the 
agent had authority or if the 

131
00:06:17,440 --> 00:06:22,160
acts was ratified. 
Now the big question liability. 

132
00:06:23,080 --> 00:06:25,960
Who gets sued? 
Who's on the hook when dealing 

133
00:06:25,960 --> 00:06:28,560
with third parties? 
Generally, the principal is 

134
00:06:28,560 --> 00:06:31,680
liable to the third party if the
agent acted with actual 

135
00:06:31,680 --> 00:06:35,160
authority, apparent authority, 
or if the principal ratified the

136
00:06:35,160 --> 00:06:36,480
ACT. 
That makes sense, right? 

137
00:06:36,480 --> 00:06:38,120
The agent was acting for them, 
sure. 

138
00:06:38,560 --> 00:06:41,760
Now the agent's liability is 
usually 0 if they acted within 

139
00:06:41,760 --> 00:06:44,040
their authority and the 
principal was fully disclosed, 

140
00:06:44,120 --> 00:06:46,240
meaning the third party knew 
they were dealing with an urgent

141
00:06:46,360 --> 00:06:50,200
and knew who the principal was. 
But here's the kicker, right The

142
00:06:50,200 --> 00:06:53,680
disclosure status. 
What if the third party doesn't 

143
00:06:53,680 --> 00:06:56,520
know who the principal is? 
That's the crucial twist and a 

144
00:06:56,520 --> 00:07:01,280
classic bar exam differentiator.
If the principal is undisclosed,

145
00:07:01,560 --> 00:07:03,840
the third party thinks they're 
just dealing with the agent 

146
00:07:03,840 --> 00:07:06,000
directly. 
No idea there's a principal 

147
00:07:06,000 --> 00:07:08,120
behind the scenes or partially 
disclosed. 

148
00:07:08,440 --> 00:07:11,600
The third party knows there is a
principal but doesn't know their

149
00:07:11,600 --> 00:07:14,240
identity. 
Then the agent is also liable on

150
00:07:14,240 --> 00:07:17,400
the contract. 
So the agent could be personally

151
00:07:17,400 --> 00:07:19,960
on the hook. 
Yes, along with the principal if

152
00:07:19,960 --> 00:07:22,880
they're later discovered. 
It's a major risk for agents. 

153
00:07:22,880 --> 00:07:25,360
In those situations. 
You absolutely need to check the

154
00:07:25,360 --> 00:07:28,200
disclosure status in any agency 
liability question. 

155
00:07:28,680 --> 00:07:32,440
Beyond liability to third 
parties, agents also owe duties 

156
00:07:32,440 --> 00:07:34,800
to their principals. 
Fiduciary duties. 

157
00:07:35,040 --> 00:07:37,320
These sound serious. 
They are extremely serious. 

158
00:07:37,640 --> 00:07:40,600
The agency relationship is built
on trust, so the law imposes 

159
00:07:40,600 --> 00:07:42,320
strict duties to protect the 
principal. 

160
00:07:42,640 --> 00:07:45,880
The big ones are the duty of 
loyalty, the duty of care and 

161
00:07:45,880 --> 00:07:47,640
the duty of obedience. 
OK, break those down. 

162
00:07:47,640 --> 00:07:49,880
Loyalty sounds pretty absolute. 
It is. 

163
00:07:49,920 --> 00:07:52,920
The agent must act solely in the
principal's best interest. 

164
00:07:53,440 --> 00:07:57,000
That means no self dealing, no 
conflicts of interest, no 

165
00:07:57,000 --> 00:08:00,520
competing with the principal, no
usurping opportunities that 

166
00:08:00,520 --> 00:08:02,800
should belong to the principal. 
It's very strict. 

167
00:08:02,880 --> 00:08:05,360
In care. 
Duty of care means the agent 

168
00:08:05,360 --> 00:08:09,120
must act with the reasonable 
diligence, competence and 

169
00:08:09,120 --> 00:08:12,000
prudence that someone in their 
position would exercise. 

170
00:08:12,800 --> 00:08:15,440
Basically, don't be negligent 
and doing the principles work. 

171
00:08:15,560 --> 00:08:18,240
And obedience. 
Follow the principles lawful 

172
00:08:18,240 --> 00:08:21,480
instructions and act only within
the scope of the authority 

173
00:08:21,480 --> 00:08:23,120
given. 
Pretty straightforward. 

174
00:08:23,720 --> 00:08:26,880
There's also a duty to account. 
Keep the principal's money 

175
00:08:26,880 --> 00:08:29,320
separate. 
Keep accurate records. 

176
00:08:29,440 --> 00:08:31,360
And if the agent breaches these 
duties? 

177
00:08:31,480 --> 00:08:34,159
The principal has remedies. 
They might be able to recover 

178
00:08:34,159 --> 00:08:37,280
damages, get back any secret 
profits the agent made that's 

179
00:08:37,280 --> 00:08:40,280
called disgorgement, or even 
rescind contracts the agent 

180
00:08:40,280 --> 00:08:43,520
improperly entered into. 
OK, that lays a solid foundation

181
00:08:43,520 --> 00:08:46,000
with agency. 
Let's shift gears now to 

182
00:08:46,000 --> 00:08:48,680
partnerships. 
Unlike corporations, which need 

183
00:08:48,680 --> 00:08:51,400
formal filings, general 
partnerships can sometimes just 

184
00:08:51,400 --> 00:08:53,680
appear. 
Identifying them seems key. 

185
00:08:53,840 --> 00:08:57,280
You've hit a critical point. 
A general partnership is simply 

186
00:08:57,280 --> 00:09:00,360
an association of two or more 
persons carrying on a business 

187
00:09:00,360 --> 00:09:04,960
for profit as Co owners and 
crucially, no formal agreement 

188
00:09:04,960 --> 00:09:08,240
or state filing is needed. 
It can arise informally. 

189
00:09:08,520 --> 00:09:11,480
But the Accounting for 
Partnership source strongly 

190
00:09:11,480 --> 00:09:14,040
recommends a written agreement. 
Oh, absolutely. 

191
00:09:14,360 --> 00:09:17,080
A written partnership agreement 
is vital to avoid disputes 

192
00:09:17,080 --> 00:09:18,960
later. 
It should detail things like 

193
00:09:18,960 --> 00:09:22,760
names, capital contributions, 
rights and duties, how profits 

194
00:09:22,760 --> 00:09:25,640
and losses are shared, what 
happens if someone withdraws 

195
00:09:25,800 --> 00:09:28,320
dispute resolution, all that 
stuff. 

196
00:09:28,600 --> 00:09:31,400
It avoids the nightmare of 
trying to divide up the pie 

197
00:09:31,400 --> 00:09:33,920
after the fact. 
So if there's no formal 

198
00:09:33,920 --> 00:09:37,200
agreement, how do you spot a 
partnership in an exam 

199
00:09:37,200 --> 00:09:38,960
hypothetical? 
What are the signs? 

200
00:09:39,000 --> 00:09:41,400
The biggest indicator, the one 
that creates A rebuttable 

201
00:09:41,400 --> 00:09:43,720
presumption of partnership, is 
profit sharing. 

202
00:09:43,920 --> 00:09:46,560
If people are sharing profits 
from a business, the law 

203
00:09:46,560 --> 00:09:48,520
presumes it's a partnership. 
But it's rebuttable. 

204
00:09:48,640 --> 00:09:52,080
Yes, it can be rebutted if the 
profit sharing is actually for 

205
00:09:52,080 --> 00:09:56,280
something else, like paying off 
a debt or rent or wages. 

206
00:09:56,880 --> 00:09:59,840
Other factors courts look at are
the party's intent. 

207
00:10:00,160 --> 00:10:03,520
Did they mean to be partners? 
Joint ownership of property used

208
00:10:03,520 --> 00:10:07,720
in the business and importantly,
participation in the control of 

209
00:10:07,720 --> 00:10:10,280
the business. 
Co ownership and mutual control 

210
00:10:10,280 --> 00:10:12,920
are strong evidence. 
OK, the accounting source 

211
00:10:12,920 --> 00:10:14,520
mentioned some key 
characteristics. 

212
00:10:14,880 --> 00:10:17,960
What are the absolute must knows
for law students, especially 

213
00:10:17,960 --> 00:10:20,080
regarding liability and how the 
partnership runs? 

214
00:10:20,200 --> 00:10:23,880
Right, four big ones. 
First, mutual agency. 

215
00:10:24,360 --> 00:10:26,960
Any partner acting in the 
ordinary course of business can 

216
00:10:26,960 --> 00:10:30,120
bind the entire partnership. 
One partner's actions can 

217
00:10:30,120 --> 00:10:31,440
obligate everyone. 
Wow. 

218
00:10:31,440 --> 00:10:34,000
OK, High stakes. 
Second, limited life. 

219
00:10:34,520 --> 00:10:37,120
Technically, the partnership 
dissolves legally if a partner 

220
00:10:37,120 --> 00:10:39,800
leaves or a new one joins. 
Now, the business might 

221
00:10:39,800 --> 00:10:42,920
continue, maybe as a new 
partnership, but the specific 

222
00:10:42,920 --> 00:10:46,000
legal entity changes. 
Dissolution doesn't 

223
00:10:46,000 --> 00:10:48,200
automatically mean termination 
of the business. 

224
00:10:48,240 --> 00:10:50,200
Got it. 
Distinction between dissolution 

225
00:10:50,200 --> 00:10:53,000
and termination. 3rd, And this 
is the big one, people worry 

226
00:10:53,000 --> 00:10:57,720
about unlimited liability. 
Each partner is personally and 

227
00:10:57,720 --> 00:11:00,200
individually liable for all 
partnership debts and 

228
00:11:00,200 --> 00:11:02,760
obligations. 
Your personal assets are 

229
00:11:02,760 --> 00:11:06,600
potentially on the line. 
That's huge, a major contrast to

230
00:11:06,600 --> 00:11:09,920
corporations. 
Definitely and 4th Co ownership 

231
00:11:09,920 --> 00:11:12,600
of property. 
Partnership assets belong to the

232
00:11:12,600 --> 00:11:15,080
partnership entity, not 
individual partners. 

233
00:11:15,400 --> 00:11:18,360
Partners have a claim on the 
total assets and profits. 

234
00:11:18,360 --> 00:11:21,080
Losses are shared equally unless
the agreement says otherwise. 

235
00:11:21,560 --> 00:11:24,240
The big disadvantage pulling all
this together is that unlimited 

236
00:11:24,240 --> 00:11:26,640
liability. 
So given that structure, 

237
00:11:26,800 --> 00:11:30,400
especially the mutual agency and
unlimited liability, how do 

238
00:11:30,400 --> 00:11:33,240
general partners make decisions?
What if there's no agreement 

239
00:11:33,240 --> 00:11:36,400
specifying roles? 
The default rule is equal rights

240
00:11:36,400 --> 00:11:38,560
in management. 
Regardless of how much capital 

241
00:11:38,560 --> 00:11:41,520
someone put in, every partner 
gets an equal vote in managing 

242
00:11:41,520 --> 00:11:43,760
the business. 
Ordinary business decisions 

243
00:11:43,760 --> 00:11:47,080
require a simple majority vote. 
But what about major decisions? 

244
00:11:47,440 --> 00:11:49,920
Extraordinary acts need 
unanimous consent. 

245
00:11:50,480 --> 00:11:53,480
Things like admitting a new 
partner, selling off most of the

246
00:11:53,480 --> 00:11:56,000
partnerships assets, 
fundamentally changing the 

247
00:11:56,000 --> 00:11:58,480
business, or amending the 
partnership agreement itself. 

248
00:11:59,000 --> 00:12:03,680
Those require everyone to agree 
and remember each partner is an 

249
00:12:03,680 --> 00:12:06,800
agent so they can bind the 
partnership through actual or 

250
00:12:06,800 --> 00:12:09,200
apparent authority when dealing 
with third parties. 

251
00:12:09,960 --> 00:12:12,520
Let's really drill down on that 
unlimited liability. 

252
00:12:13,040 --> 00:12:17,360
How does it work in practice if 
say the partnership owes a big 

253
00:12:17,360 --> 00:12:20,440
debt joint and several 
liability? 

254
00:12:20,480 --> 00:12:23,360
Yes, partners are jointly and 
severally liable for all 

255
00:12:23,360 --> 00:12:25,760
partnership obligations, 
contract or tort. 

256
00:12:26,200 --> 00:12:29,400
That means a creditor can sue 
anyone partner, or some or all 

257
00:12:29,400 --> 00:12:32,480
of them, and potentially recover
the entire debt from any single 

258
00:12:32,480 --> 00:12:34,120
partner they choose who has 
assets. 

259
00:12:34,120 --> 00:12:37,040
Well, so one partner could end 
up paying everything. 

260
00:12:37,160 --> 00:12:39,920
Potentially yes, though that 
partner would typically have a 

261
00:12:39,920 --> 00:12:42,800
right to seek contribution from 
the other partners, but the 

262
00:12:42,800 --> 00:12:44,840
creditor doesn't have to chase 
everyone. 

263
00:12:45,040 --> 00:12:46,800
However, there is usually an 
exhaustion rule. 

264
00:12:47,200 --> 00:12:49,520
Creditors generally have to try 
to collect from the partnerships

265
00:12:49,520 --> 00:12:52,280
assets first before they can go 
after the partners personal 

266
00:12:52,280 --> 00:12:54,240
assets. 
OK, that's a small protection. 

267
00:12:54,560 --> 00:12:56,280
What about new partners coming 
in? 

268
00:12:56,720 --> 00:12:59,760
Are they liable for old debts? 
That's a common bar caution. 

269
00:12:59,960 --> 00:13:03,720
A newly admitted partner is not 
personally liable for debts the 

270
00:13:03,720 --> 00:13:05,640
partnership incurred before they
joined. 

271
00:13:06,080 --> 00:13:08,480
However, their capital 
contribution to the partnership 

272
00:13:08,480 --> 00:13:12,320
is at risk for those old debts. 
And like agents, partners owe 

273
00:13:12,320 --> 00:13:14,280
each other fiduciary duties, 
too, right? 

274
00:13:14,480 --> 00:13:16,600
Loyalty care. 
Absolutely. 

275
00:13:16,600 --> 00:13:19,600
Very similar duties. 
A strict duty of loyalty. 

276
00:13:19,600 --> 00:13:21,360
Act in the partnerships best 
interest. 

277
00:13:21,440 --> 00:13:24,800
No competing, no self dealing, 
no usurping opportunities. 

278
00:13:25,200 --> 00:13:26,720
A duty of care. 
Essentially. 

279
00:13:26,720 --> 00:13:29,000
Don't be grossly negligent or 
reckless. 

280
00:13:29,000 --> 00:13:32,080
Don't engage in intentional 
misconduct or knowing violations

281
00:13:32,080 --> 00:13:36,000
of law and a duty of disclosure.
Keep partners informed about 

282
00:13:36,000 --> 00:13:38,640
partnership matters. 
Can the partnership agreement 

283
00:13:38,720 --> 00:13:41,480
change these duties? 
This is key for the exam. 

284
00:13:41,800 --> 00:13:45,480
The agreement cannot eliminate 
the duty of loyalty, but it can 

285
00:13:45,480 --> 00:13:48,560
define specific activities that 
don't violate it, or set 

286
00:13:48,560 --> 00:13:51,040
standards for measuring the duty
of care, as long as those 

287
00:13:51,040 --> 00:13:53,280
standards aren't manifestly 
unreasonable. 

288
00:13:53,760 --> 00:13:56,960
So you can shape the duties, but
you can't get rid of the core 

289
00:13:56,960 --> 00:13:59,640
obligations. 
OK, now let's talk about the end

290
00:13:59,640 --> 00:14:02,760
game dissociation and 
dissolution. 

291
00:14:03,680 --> 00:14:06,160
They sound similar but aren't 
the same. 

292
00:14:06,480 --> 00:14:10,760
Correct dissociation is when a 
partner leaves the partnership. 

293
00:14:10,800 --> 00:14:13,760
It could be voluntary 
withdrawal, expulsion, death, 

294
00:14:13,920 --> 00:14:17,360
bankruptcy, etcetera. 
If the dissociation breaches the

295
00:14:17,360 --> 00:14:20,960
partnership agreement, it's 
considered wrongful dissociation

296
00:14:20,960 --> 00:14:23,720
and that partner might be liable
for damages caused. 

297
00:14:23,720 --> 00:14:26,200
And dissolution. 
Dissolution isn't necessarily 

298
00:14:26,200 --> 00:14:29,000
the end of the business, but 
it's the start of the winding up

299
00:14:29,000 --> 00:14:32,080
process for that particular 
partnership entity. 

300
00:14:32,560 --> 00:14:35,240
It involves settling debts, 
liquidating assets and 

301
00:14:35,240 --> 00:14:37,720
distributing what's left. 
And that distribution order 

302
00:14:37,720 --> 00:14:40,280
during winding up, that's super 
important for exams, isn't it? 

303
00:14:40,520 --> 00:14:43,880
Highly tested, The order is 
strict first pay outside 

304
00:14:43,880 --> 00:14:45,840
creditors. 
This also includes partners who 

305
00:14:45,840 --> 00:14:48,200
are creditors, like if they 
loaned money to the partnership.

306
00:14:48,200 --> 00:14:51,800
OK, creditors first. 2nd pay 
back partners for their capital 

307
00:14:51,800 --> 00:14:53,760
contributions, whatever they put
in initially. 

308
00:14:53,760 --> 00:14:57,040
Return of capital. 3rd 
distribute any remaining profits

309
00:14:57,040 --> 00:14:59,840
according to the partnership 
agreement or equally if the 

310
00:14:59,840 --> 00:15:02,320
agreement is silent. 
What if there isn't enough money

311
00:15:02,320 --> 00:15:05,280
to pay pay everyone back, 
especially the partners capital?

312
00:15:06,160 --> 00:15:08,560
What if someone's capital 
account is negative? 

313
00:15:08,720 --> 00:15:10,320
That's where the accounting 
details come in. 

314
00:15:10,440 --> 00:15:13,280
If, after selling assets and 
paying outside creditors, a 

315
00:15:13,280 --> 00:15:16,960
partner has a negative capital 
balance, a deficiency, they 

316
00:15:16,960 --> 00:15:19,240
generally owe that amount back 
to the partnership. 

317
00:15:19,560 --> 00:15:23,200
If they're insolvent and can't 
pay, that loss gets allocated 

318
00:15:23,200 --> 00:15:26,840
among the other partners who do 
have positive balances, usually 

319
00:15:26,840 --> 00:15:29,280
based on their profit loss 
sharing ratios. 

320
00:15:30,000 --> 00:15:32,920
It shows how that personal 
liability sticks around right to

321
00:15:32,920 --> 00:15:35,360
the very end. 
That unlimited liability is 

322
00:15:35,360 --> 00:15:38,600
definitely a major drawback of 
general partnerships, which 

323
00:15:38,600 --> 00:15:41,120
naturally leads us to the 
special forms of partnerships 

324
00:15:41,120 --> 00:15:44,520
designed to limit that risk. 
Exactly, people wanted ways to 

325
00:15:44,520 --> 00:15:47,720
partner up without risking their
personal assets quite so much 

326
00:15:47,920 --> 00:15:50,320
first. 
You have limited partnerships, 

327
00:15:50,640 --> 00:15:51,600
LP's. 
LP's. 

328
00:15:51,600 --> 00:15:54,440
What's the structure there? 
An LP must have at least one 

329
00:15:54,440 --> 00:15:56,960
general partner. 
They manage the business and 

330
00:15:56,960 --> 00:16:00,200
have full unlimited personal 
liability, just like in a 

331
00:16:00,200 --> 00:16:03,840
general partnership, but it also
has one or more limited 

332
00:16:03,840 --> 00:16:05,720
partners. 
These partners contribute 

333
00:16:05,720 --> 00:16:08,480
capital, but they do not 
participate in management and in

334
00:16:08,480 --> 00:16:11,680
return their liability is 
limited to their investment. 

335
00:16:12,000 --> 00:16:14,360
Lease your investment but not 
your house. 

336
00:16:14,880 --> 00:16:16,720
And these require a state 
filing. 

337
00:16:16,760 --> 00:16:19,040
Yes, absolutely. 
You have to file a certificate 

338
00:16:19,040 --> 00:16:22,320
of limited partnership with the 
state to form an LP properly. 

339
00:16:22,760 --> 00:16:26,040
No filing, no limited liability 
for the limited partners. 

340
00:16:26,080 --> 00:16:27,560
OK. 
Then there's the Limited 

341
00:16:27,560 --> 00:16:30,080
Liability Partnership LLP. 
This sounds different. 

342
00:16:30,320 --> 00:16:32,080
It is. 
LLPS are very popular, 

343
00:16:32,080 --> 00:16:34,200
especially for professional 
groups like law firms, 

344
00:16:34,200 --> 00:16:36,120
accounting firms, metal 
practices. 

345
00:16:36,360 --> 00:16:39,720
The key difference is that in an
LLP, all partners get some form 

346
00:16:39,720 --> 00:16:42,400
of limited liability. 
Protection all partners, so no 

347
00:16:42,400 --> 00:16:44,440
general partner with unlimited 
liability. 

348
00:16:44,600 --> 00:16:47,000
Correct. 
As the accounting source puts 

349
00:16:47,000 --> 00:16:50,720
it, in an LLP all partners have 
limited liability. 

350
00:16:50,720 --> 00:16:54,600
There are no general partners. 
Generally, partners are not 

351
00:16:54,600 --> 00:16:57,280
personally liable for the 
partnership's debts or, 

352
00:16:57,440 --> 00:16:59,880
crucially, for the malpractice 
or torts committed by other 

353
00:16:59,880 --> 00:17:01,800
partners. 
You're responsible for your own 

354
00:17:01,800 --> 00:17:04,359
negligence, but not necessarily 
your partners. 

355
00:17:04,480 --> 00:17:06,520
That sounds like a huge benefit 
for professionals. 

356
00:17:06,920 --> 00:17:10,119
Do they need to file? 
Yes, LLP's also require 

357
00:17:10,119 --> 00:17:12,680
registration with the state and 
often they have to carry a 

358
00:17:12,680 --> 00:17:14,560
certain amount of liability 
insurance. 

359
00:17:14,800 --> 00:17:18,400
And finally, the really popular 
one these days, The Limited 

360
00:17:18,400 --> 00:17:22,960
Liability Company, LLC. 
Hugely popular and LSC offers 

361
00:17:22,960 --> 00:17:25,760
its owners, called members, 
limited personal liability for 

362
00:17:25,760 --> 00:17:28,359
the business's debts, similar to
a corporation. 

363
00:17:28,840 --> 00:17:31,800
But the big draw is that members
can participate in management 

364
00:17:31,800 --> 00:17:33,800
without losing their liability 
shield. 

365
00:17:34,120 --> 00:17:36,760
So you get the liability 
protection of a corporation, but

366
00:17:36,760 --> 00:17:39,680
potentially the flexibility and 
tax treatment of a partnership. 

367
00:17:39,840 --> 00:17:42,720
That's the appeal. 
It blends those features the 

368
00:17:42,720 --> 00:17:45,120
source mentions. 
Subchapter S corporations offer 

369
00:17:45,120 --> 00:17:48,640
similar pass through taxation 
but often involve more paperwork

370
00:17:48,640 --> 00:17:52,080
and complexity than LLC's, Hence
LLC's gaining popularity. 

371
00:17:52,440 --> 00:17:55,080
The trade off for all these 
limited liability entities 

372
00:17:55,080 --> 00:17:59,400
LPLLPLLC is generally more 
formality and cost in setting 

373
00:17:59,400 --> 00:18:01,640
them up compared to a simple 
general partnership. 

374
00:18:01,760 --> 00:18:04,000
But you get that crucial 
protection from personal 

375
00:18:04,000 --> 00:18:06,880
liability. 
OK, that's a fantastic overview 

376
00:18:06,880 --> 00:18:09,520
of business associations. 
Let's shift gears now to the 

377
00:18:09,520 --> 00:18:12,560
promises that drive our economy 
contract. 

378
00:18:13,320 --> 00:18:16,120
And specifically, let's tackle 
that critical, often tricky 

379
00:18:16,120 --> 00:18:19,320
interplay between common law and
the Uniform Commercial Code at 

380
00:18:19,320 --> 00:18:21,840
the UCC. 
This is always a major issue on 

381
00:18:21,840 --> 00:18:23,320
the ME. 
You are absolutely right. 

382
00:18:23,320 --> 00:18:26,080
This distinction is the hot 
topic for contracts essays. 

383
00:18:26,080 --> 00:18:27,960
Seriously. 
As any seasoned bar prepper 

384
00:18:27,960 --> 00:18:30,680
knows, your very first step on 
any contracts question has to be

385
00:18:30,680 --> 00:18:32,720
figuring out which body of law 
applies. 

386
00:18:32,840 --> 00:18:35,280
Common law or UCC Article 2 get 
this wrong. 

387
00:18:35,280 --> 00:18:36,600
Your whole analysis could be 
off. 

388
00:18:36,760 --> 00:18:38,960
Completely off the rules for 
everything. 

389
00:18:38,960 --> 00:18:41,920
Formation, modification, 
performance remedies, they all 

390
00:18:41,920 --> 00:18:44,080
diverge based based on this 
initial determination. 

391
00:18:44,400 --> 00:18:46,400
So you have to do what we call 
the vibe check first. 

392
00:18:46,400 --> 00:18:47,880
OK. 
So let's do that vibe check. 

393
00:18:48,080 --> 00:18:52,480
What's the fundamental split? 
Common law versus UCC? 

394
00:18:52,760 --> 00:18:56,520
Common law governs contracts for
services like legal services, 

395
00:18:56,520 --> 00:18:59,600
construction, real estate, 
employment contracts, and 

396
00:18:59,600 --> 00:19:01,840
contracts involving intangible 
assets. 

397
00:19:02,080 --> 00:19:04,920
Think trademarks, copyrights, 
software licenses. 

398
00:19:04,920 --> 00:19:08,680
Though software can be tricky, 
it's the traditional judge made 

399
00:19:08,680 --> 00:19:11,920
law built on precedent. 
And the UCC Article 2 

400
00:19:11,920 --> 00:19:14,200
specifically. 
UCC Article 2 governs 

401
00:19:14,200 --> 00:19:18,080
transactions in goods, and goods
are defined as tangible movable 

402
00:19:18,080 --> 00:19:20,440
items at the time they're 
identified to the contract. 

403
00:19:20,800 --> 00:19:23,680
So think cars, computers, crops,
machinery, furniture. 

404
00:19:23,680 --> 00:19:25,840
If you can touch it and move it,
it's likely a good does. 

405
00:19:25,920 --> 00:19:28,400
Price matter or who the parties 
are? 

406
00:19:28,440 --> 00:19:30,840
Nope. 
UCC Article 2 applies whether 

407
00:19:30,840 --> 00:19:34,200
it's a $5 pack of screws or 
$1,000,000 piece of equipment, 

408
00:19:34,200 --> 00:19:36,520
and whether the parties are 
giant corporations or just 

409
00:19:36,520 --> 00:19:39,480
regular people. 
OK, but what about those messy 

410
00:19:39,480 --> 00:19:43,920
hybrid contracts? 
Contracts involving both goods 

411
00:19:43,920 --> 00:19:46,560
and services? 
Like getting a new furnace 

412
00:19:46,560 --> 00:19:49,920
installed, You get the furnace 
goods and the installation 

413
00:19:49,920 --> 00:19:51,080
service. 
Great example. 

414
00:19:51,400 --> 00:19:54,680
For those hybrid situations, 
courts apply the predominant 

415
00:19:54,680 --> 00:19:57,760
purpose test. 
You have to ask what was the 

416
00:19:57,760 --> 00:20:01,240
main point of this contract? 
Was it primarily to get the 

417
00:20:01,240 --> 00:20:03,960
good? 
The furnace or was it primarily 

418
00:20:03,960 --> 00:20:06,080
to get the service the 
installation? 

419
00:20:06,080 --> 00:20:08,280
How do you figure that out? 
You look at factors like the 

420
00:20:08,280 --> 00:20:10,600
language of the contract, the 
nature of the suppliers 

421
00:20:10,600 --> 00:20:14,040
business, and often quite 
importantly, the relative cost 

422
00:20:14,040 --> 00:20:15,680
of the goods versus the 
services. 

423
00:20:16,080 --> 00:20:19,000
If the furnace itself cost 
thousands and the installation 

424
00:20:19,000 --> 00:20:22,200
is a few 100, the predominant 
purpose is likely the sale of 

425
00:20:22,200 --> 00:20:24,240
goods, so UCC applies to the 
whole thing. 

426
00:20:24,920 --> 00:20:27,600
If it's a complex custom 
software development project 

427
00:20:27,600 --> 00:20:30,920
service that happens to be 
delivered on a disk, good common

428
00:20:30,920 --> 00:20:33,280
law probably applies because the
service dominates. 

429
00:20:33,400 --> 00:20:35,800
So you really have to analyze 
the core purpose. 

430
00:20:35,800 --> 00:20:38,520
That's why doing that vibe check
first is so critical. 

431
00:20:38,520 --> 00:20:40,480
Absolutely. 
Don't even think about offer and

432
00:20:40,480 --> 00:20:43,120
acceptance rules until you know 
which offer and acceptance rules

433
00:20:43,120 --> 00:20:45,000
apply. 
All right, so we've done our 

434
00:20:45,000 --> 00:20:47,280
vibe check. 
Let's say there's an UCC land 

435
00:20:47,280 --> 00:20:50,240
dealing with goods. 
How did the rules for formation 

436
00:20:50,240 --> 00:20:53,760
and modification differ from 
common law offer and acceptance 

437
00:20:53,760 --> 00:20:55,680
first? 
Big difference here. 

438
00:20:55,680 --> 00:20:58,960
Under common law you have the 
rigid mirror image rule. 

439
00:20:59,360 --> 00:21:02,040
The acceptance must mirror the 
offer exactly. 

440
00:21:02,120 --> 00:21:05,160
Any tiny change makes it a 
counter offer, killing the 

441
00:21:05,160 --> 00:21:06,840
original offer. 
Right, super strict. 

442
00:21:06,880 --> 00:21:10,880
But under the UCC, Forget the 
Mirror Image rule, section 22O7,

443
00:21:10,880 --> 00:21:14,560
the infamous Battle of the Forms
allows a contract to be formed 

444
00:21:14,560 --> 00:21:17,320
even if the acceptance contains 
different or additional terms 

445
00:21:17,320 --> 00:21:19,800
compared to the offer, as long 
as there was a definite 

446
00:21:19,800 --> 00:21:23,240
expression of acceptance. 
The UCC recognizes that business

447
00:21:23,240 --> 00:21:26,320
people often use conflicting 
forms and still intend to make a

448
00:21:26,320 --> 00:21:28,640
deal. 
So more flexible reflects 

449
00:21:28,640 --> 00:21:30,560
commercial reality better. 
Exactly. 

450
00:21:30,560 --> 00:21:32,840
Now what happens to those 
different terms is a whole other

451
00:21:32,840 --> 00:21:34,880
complex analysis under 2 two O 
7. 

452
00:21:34,920 --> 00:21:37,720
But the key take away is a 
contract can still be formed. 

453
00:21:37,760 --> 00:21:41,080
What about consideration, 
especially for modifying an 

454
00:21:41,080 --> 00:21:43,880
existing contract? 
Another major divergent Under 

455
00:21:43,880 --> 00:21:47,040
common law you need new 
consideration for a modification

456
00:21:47,040 --> 00:21:49,880
to be binding. 
The pre-existing duty rule 

457
00:21:49,880 --> 00:21:51,720
applies. 
Agreeing to do something you 

458
00:21:51,720 --> 00:21:55,560
were already obligated to do 
isn't valid consideration for a 

459
00:21:55,560 --> 00:21:57,400
promise of more money, for 
instance. 

460
00:21:57,400 --> 00:21:59,080
OK, need something new 
exchanged. 

461
00:21:59,240 --> 00:22:02,640
But under the UCC, modifications
of contracts for the sale of 

462
00:22:02,640 --> 00:22:05,720
goods need no new consideration 
to be binding. 

463
00:22:05,960 --> 00:22:08,640
The only requirement is that the
modification is made in good 

464
00:22:08,640 --> 00:22:11,360
faith. 
Wow, no consideration needed, 

465
00:22:11,360 --> 00:22:12,560
just good faith. 
Yes. 

466
00:22:12,880 --> 00:22:16,080
This allows businesses to adjust
contracts based on changing 

467
00:22:16,080 --> 00:22:19,080
market conditions or unforeseen 
circumstances without the 

468
00:22:19,080 --> 00:22:21,040
formality of finding new 
consideration. 

469
00:22:21,320 --> 00:22:23,040
It's about commercial 
practicality. 

470
00:22:23,280 --> 00:22:26,320
What's fascinating is how the 
UCC really prioritizes that 

471
00:22:26,320 --> 00:22:28,720
flexibility. 
Let's talk Option contracts 

472
00:22:28,920 --> 00:22:31,480
promises to keep an offer open. 
These have different rules too, 

473
00:22:31,720 --> 00:22:34,720
and it feels like a classic exam
trap involving merchants. 

474
00:22:35,080 --> 00:22:37,120
Definitely a trap. 
Under common law, to make an 

475
00:22:37,120 --> 00:22:40,520
offer irrevocable for a period 
of time an option, you need 

476
00:22:40,520 --> 00:22:43,160
separate consideration paid for 
that promise to keep the offer 

477
00:22:43,160 --> 00:22:44,960
open. 
No consideration. 

478
00:22:44,960 --> 00:22:48,080
The offerer can generally revoke
anytime before acceptance. 

479
00:22:48,240 --> 00:22:51,920
So even if they promise in 
writing to keep it open, if you 

480
00:22:51,920 --> 00:22:54,920
don't pay something for that 
promise, it's usually not 

481
00:22:54,920 --> 00:22:57,960
binding under common law. 
Correct, but the UCC has a 

482
00:22:58,000 --> 00:23:02,160
special rule called the Firm 
Offer Rule, section 2205. 

483
00:23:02,480 --> 00:23:05,280
This applies only to offers to 
buy or sell goods. 

484
00:23:05,640 --> 00:23:10,680
An offer is irrevocable even 
without consideration if one the

485
00:23:10,680 --> 00:23:12,920
offer is a merchant. 
Was a merchant again. 

486
00:23:13,000 --> 00:23:16,320
Someone who regularly deals in 
goods of the kind involved in 

487
00:23:16,320 --> 00:23:19,480
the transaction, or holds 
themselves out as having special

488
00:23:19,480 --> 00:23:21,560
knowledge or skill regarding 
those goods. 

489
00:23:21,760 --> 00:23:23,760
OK, so offer must be a merchant.
What else? 

490
00:23:23,960 --> 00:23:26,840
2, the offer gives an assurance 
that it will be held open, and 

491
00:23:26,840 --> 00:23:29,880
three, that assurance is 
contained in a signed writing 

492
00:23:29,880 --> 00:23:31,680
from the offer. 
Signed writing is key. 

493
00:23:31,920 --> 00:23:33,920
Absolutely. 
If those three conditions are 

494
00:23:33,920 --> 00:23:37,400
met, merchant offer signed 
writing assurance. 

495
00:23:37,400 --> 00:23:40,240
It's open. 
The offer is irrevocable for the

496
00:23:40,240 --> 00:23:43,200
time stated or a reasonable 
time, but never longer than 

497
00:23:43,200 --> 00:23:45,160
three months even without 
consideration. 

498
00:23:45,760 --> 00:23:48,960
That Mee scenario with the 
amateur gardener selling 

499
00:23:48,960 --> 00:23:51,880
tomatoes? 
He's not a merchant, so even if 

500
00:23:51,880 --> 00:23:55,680
he promises in writing to keep 
the offer open, it's not a firm 

501
00:23:55,680 --> 00:23:58,440
offer under the UCC. 
You'd need consideration under 

502
00:23:58,440 --> 00:24:00,040
common law. 
That's a great illustration. 

503
00:24:00,040 --> 00:24:02,280
OK, and let's clarify 
revocation. 

504
00:24:02,480 --> 00:24:04,440
That word seems to pop up in 
different contexts. 

505
00:24:04,440 --> 00:24:07,680
Yes, and timing is everything. 
Revocation of an offer happens 

506
00:24:07,680 --> 00:24:10,720
before a contract is formed. 
The offer expect the offer 

507
00:24:10,720 --> 00:24:13,520
before the offeree accepts. 
That's generally allowed unless 

508
00:24:13,520 --> 00:24:15,760
it's an option contract or a UCC
firm. 

509
00:24:15,760 --> 00:24:18,240
Offer OK pre contract. 
Revocation of acceptance, 

510
00:24:18,240 --> 00:24:20,920
however, happens after a 
contract is formed and after the

511
00:24:20,920 --> 00:24:22,480
buyer has already accepted the 
goods. 

512
00:24:23,080 --> 00:24:26,160
Under the UCC, a buyer can 
sometimes revoke their 

513
00:24:26,160 --> 00:24:28,800
acceptance if they later 
discover a substantial defect 

514
00:24:28,800 --> 00:24:32,280
that wasn't apparent at first. 
So same word revocation, but 

515
00:24:32,280 --> 00:24:33,920
totally different stages and 
rules. 

516
00:24:34,200 --> 00:24:36,040
You've got to know where you are
on the timeline. 

517
00:24:36,280 --> 00:24:39,480
Good distinction. 
The UCC also seems more 

518
00:24:39,480 --> 00:24:42,680
comfortable with open terms in a
contract than common law. 

519
00:24:42,880 --> 00:24:45,800
Generally, yes. 
The UCC allows a contract to be 

520
00:24:45,800 --> 00:24:49,840
formed even if some terms, like 
price or delivery time are left 

521
00:24:49,840 --> 00:24:51,800
open. 
As long as the parties intended 

522
00:24:51,800 --> 00:24:54,720
to make a contract and there's a
reasonably certain basis for 

523
00:24:54,720 --> 00:24:57,960
giving a remedy, the courts can 
often fill in these gaps with 

524
00:24:57,960 --> 00:25:00,640
reasonable terms based on UCC 
provisions. 

525
00:25:00,640 --> 00:25:02,720
Is there any term that usually 
must be there? 

526
00:25:03,280 --> 00:25:05,560
Quantity. 
Quantity is typically essential 

527
00:25:05,560 --> 00:25:08,000
under the UCC, although there 
are exceptions. 

528
00:25:08,000 --> 00:25:11,320
For output Contracts, seller 
agrees to sell all they produce,

529
00:25:11,400 --> 00:25:13,840
and requirements contracts, 
Buyer agrees to buy all they 

530
00:25:13,840 --> 00:25:16,480
need as long as the quantities 
aren't unreasonably 

531
00:25:16,480 --> 00:25:18,400
disproportionate and are handled
in good faith. 

532
00:25:18,400 --> 00:25:20,200
OK, let's move to the parole 
evidence rule. 

533
00:25:20,200 --> 00:25:22,440
This rule often causes 
headaches. 

534
00:25:23,000 --> 00:25:25,120
What's the basic idea? 
What is it trying to do? 

535
00:25:25,320 --> 00:25:28,320
The parole evidence rule isn't 
actually a rule of evidence, 

536
00:25:28,320 --> 00:25:31,000
despite the name. 
It's a rule of substantive 

537
00:25:31,000 --> 00:25:33,920
contract law. 
Its purpose is to give finality 

538
00:25:33,920 --> 00:25:37,000
to written agreements. 
If the parties intended their 

539
00:25:37,000 --> 00:25:40,280
written contract to be the final
and complete expression of their

540
00:25:40,280 --> 00:25:43,520
agreement, this rule prevents 
them from bringing in evidence 

541
00:25:43,520 --> 00:25:47,520
of prior or contemporaneous oral
agreements, or sometimes even 

542
00:25:47,520 --> 00:25:50,400
prior written agreements, to 
contradict the terms of that 

543
00:25:50,400 --> 00:25:53,240
final writing. 
So it keeps outside stuff out if

544
00:25:53,240 --> 00:25:54,960
the writing is meant to be the 
final word. 

545
00:25:55,000 --> 00:25:57,480
Pretty much. 
Now the key is determining how 

546
00:25:57,480 --> 00:25:59,480
final the writing was intended 
to be. 

547
00:25:59,760 --> 00:26:03,160
Was it fully integrated, meant 
to be the complete and exclusive

548
00:26:03,160 --> 00:26:07,240
statement of all terms, or just 
partially integrated, final on 

549
00:26:07,240 --> 00:26:09,760
the terms included but not 
necessarily covering everything?

550
00:26:09,960 --> 00:26:11,920
How does that distinction matter
under the UCC? 

551
00:26:12,440 --> 00:26:15,040
If it's partially integrated, 
the writing can be supplemented 

552
00:26:15,040 --> 00:26:18,280
by evidence of consistent 
additional terms, but if it's 

553
00:26:18,280 --> 00:26:21,080
fully integrated, it generally 
cannot be contradicted or 

554
00:26:21,080 --> 00:26:24,080
supplemented by prior or 
contemporaneous agreements. 

555
00:26:24,240 --> 00:26:27,240
But are there things that always
get in even if it's fully 

556
00:26:27,240 --> 00:26:30,680
integrated exceptions? 
Yes, and these are crucial. 

557
00:26:30,680 --> 00:26:32,920
Even a fully integrated 
agreement can always be 

558
00:26:32,920 --> 00:26:36,160
explained or supplemented, 
though not contradicted by 

559
00:26:36,160 --> 00:26:38,400
evidence of course of 
performance. 

560
00:26:38,560 --> 00:26:40,880
How these parties acted under 
this contract so far. 

561
00:26:40,880 --> 00:26:43,960
Course of dealing How these 
parties acted in past contracts 

562
00:26:43,960 --> 00:26:47,560
with each other and usage of 
trade standard practices in the 

563
00:26:47,560 --> 00:26:50,880
relevant industry or locale. 
So a context always matters. 

564
00:26:51,000 --> 00:26:54,160
Exactly. 
The UCC recognizes that context 

565
00:26:54,160 --> 00:26:56,720
is vital to understanding 
commercial agreements. 

566
00:26:57,240 --> 00:27:00,400
Parole evidence is also always 
admissible to show things like 

567
00:27:00,600 --> 00:27:04,000
fraud, duress, mistake, 
illegality, lack of 

568
00:27:04,000 --> 00:27:08,360
consideration, or to clarify an 
ambiguity in the writing, or to 

569
00:27:08,360 --> 00:27:10,600
show the existence of a 
condition president to the 

570
00:27:10,600 --> 00:27:11,960
contract. 
OK. 

571
00:27:11,960 --> 00:27:15,120
Now, for performance 
obligations, this feels like 

572
00:27:15,120 --> 00:27:18,920
another major split between 
common law and UCC, the standard

573
00:27:18,920 --> 00:27:20,200
required. 
Huge difference. 

574
00:27:20,480 --> 00:27:23,200
Under common law, the standard 
is generally substantial 

575
00:27:23,200 --> 00:27:25,240
performance. 
If a party substantially 

576
00:27:25,240 --> 00:27:27,720
performs their obligations, 
meaning they don't breach in a 

577
00:27:27,720 --> 00:27:29,880
material way, minor defects are 
OK. 

578
00:27:30,120 --> 00:27:32,760
They're entitled to payment 
minus any damages for the minor 

579
00:27:32,760 --> 00:27:34,240
defects. 
Substantial performance, OK. 

580
00:27:34,520 --> 00:27:38,640
But under UCC Article 2, for 
single delivery contracts, the 

581
00:27:38,640 --> 00:27:41,600
general rule is the perfect 
tender rule. 

582
00:27:41,800 --> 00:27:44,760
The seller must deliver goods 
that conform perfectly to the 

583
00:27:44,760 --> 00:27:47,920
contract terms, quantity, 
quality, delivery method, 

584
00:27:48,080 --> 00:27:51,400
everything. 
Any deviation, however small, 

585
00:27:51,600 --> 00:27:53,920
allows the buyer to reject the 
goods. 

586
00:27:54,040 --> 00:27:57,200
Well, perfect Tender sounds 
incredibly strict for sellers. 

587
00:27:57,360 --> 00:28:00,400
It is a very high standard, but 
there are important exceptions 

588
00:28:00,400 --> 00:28:02,600
that soften it. 
Like the seller's right to cure.

589
00:28:02,600 --> 00:28:04,520
Exactly. 
The seller's right to cure is a 

590
00:28:04,520 --> 00:28:06,800
big one. 
If the buyer rejects goods as 

591
00:28:06,800 --> 00:28:10,240
nonconforming, the seller might 
have a chance to fix the problem

592
00:28:10,240 --> 00:28:13,720
or cure. 
They can do this if one, the 

593
00:28:13,720 --> 00:28:16,440
time for performance under the 
contract hasn't expired yet, or 

594
00:28:16,440 --> 00:28:19,840
two, even if time has expired, 
the seller had reasonable 

595
00:28:19,840 --> 00:28:22,120
grounds to believe the non 
conforming tender would be 

596
00:28:22,120 --> 00:28:25,560
acceptable, maybe based on prior
dealings, and they promptly 

597
00:28:25,560 --> 00:28:27,680
notify the buyer of their intent
to cure. 

598
00:28:27,960 --> 00:28:30,480
So it gives sellers a second 
chance in some situations. 

599
00:28:30,480 --> 00:28:33,320
Yes, it balances the harshness 
of perfect tender. 

600
00:28:33,360 --> 00:28:35,560
What about the buyer side after 
acceptance? 

601
00:28:35,640 --> 00:28:38,000
We mentioned revocation of 
acceptance and how do 

602
00:28:38,000 --> 00:28:40,440
installment contracts work? 
It seemed different. 

603
00:28:40,760 --> 00:28:44,000
Right, revocation of acceptance.
Let's buyer undo their 

604
00:28:44,000 --> 00:28:47,440
acceptance later, but only if 
the nonconformity substantially 

605
00:28:47,440 --> 00:28:50,560
impairs the value of the goods 
to them and they accept it 

606
00:28:50,560 --> 00:28:52,920
either because the defect was 
hard to discover or because the 

607
00:28:52,920 --> 00:28:54,640
seller assured them it would be 
fixed. 

608
00:28:54,960 --> 00:28:58,360
It's a higher bar than initial 
rejection and installment 

609
00:28:58,360 --> 00:29:00,640
contracts. 
Contracts authorizing deliveries

610
00:29:00,640 --> 00:29:02,800
and separate lots have different
rejection roles. 

611
00:29:03,120 --> 00:29:06,440
A buyer can only reject a single
installment if the nonconformity

612
00:29:06,440 --> 00:29:09,400
substantially impairs the value 
of that installment and cannot 

613
00:29:09,400 --> 00:29:11,840
be cured. 
They can only cancel the entire 

614
00:29:11,840 --> 00:29:14,680
contract if the nonconformity in
one or more installments 

615
00:29:14,680 --> 00:29:17,360
substantially impairs the value 
of the whole contract. 

616
00:29:17,680 --> 00:29:21,040
So Perfect Tender doesn't apply 
to individual installments in 

617
00:29:21,040 --> 00:29:23,080
the same way. 
OK, that makes sense for ongoing

618
00:29:23,080 --> 00:29:25,720
relationships. 
Now let's talk about warranties 

619
00:29:25,840 --> 00:29:27,920
under the UCC. 
These are basically promises the

620
00:29:27,920 --> 00:29:29,200
seller makes about the goods, 
right? 

621
00:29:29,280 --> 00:29:32,400
Exactly there are assurances 
about quality or performance. 

622
00:29:32,720 --> 00:29:36,880
The UCC recognizes 3 main types 
that you absolutely need to know

623
00:29:36,880 --> 00:29:38,720
for the bar. 
Lay them out for us. 

624
00:29:38,800 --> 00:29:42,920
First, express warranties. 
These are created by the sellers

625
00:29:42,920 --> 00:29:45,920
actual words or actions. 
It could be an affirmation of 

626
00:29:45,920 --> 00:29:47,760
fact or a promise about the 
goods. 

627
00:29:48,200 --> 00:29:50,920
This car gets 30 miles per 
gallon, a description of the 

628
00:29:50,920 --> 00:29:54,920
goods, 100% wool sweater, or 
even showing a sample or model. 

629
00:29:55,400 --> 00:29:59,120
If it becomes part of the basis 
of the bargain, it's an express 

630
00:29:59,120 --> 00:30:01,040
warranty. 
What about just sales? 

631
00:30:01,040 --> 00:30:03,200
Talk like this is a fantastic 
deal. 

632
00:30:03,200 --> 00:30:05,760
That's generally considered 
puffery and doesn't create an 

633
00:30:05,760 --> 00:30:07,720
express warranty. 
It has to be more concrete. 

634
00:30:07,760 --> 00:30:09,560
OK, Express warranties. 
What else? 

635
00:30:09,720 --> 00:30:12,360
Second, the implied warranty of 
merchant ability. 

636
00:30:12,520 --> 00:30:14,880
This is a big one. 
It's implied automatically by 

637
00:30:14,880 --> 00:30:17,560
law whenever the seller is a 
merchant dealing in goods of 

638
00:30:17,560 --> 00:30:19,760
that kind. 
It means the goods are fit for 

639
00:30:19,760 --> 00:30:24,040
their ordinary purpose. 
A toaster toasts bread, a chair 

640
00:30:24,040 --> 00:30:26,680
holds weight, etcetera. 
So it arises just because the 

641
00:30:26,680 --> 00:30:29,280
seller is a merchant. 
Yes, unless it's properly 

642
00:30:29,280 --> 00:30:32,000
disclaimed. 
Third, the implied warranty of 

643
00:30:32,000 --> 00:30:33,840
fitness for a particular 
purpose. 

644
00:30:34,360 --> 00:30:38,480
This arises when, at the time of
contracting, the seller knows or

645
00:30:38,480 --> 00:30:41,520
has reason to know the specific 
purpose for which the buyer 

646
00:30:41,520 --> 00:30:44,880
needs the goods, and the buyer 
is relying on the seller's skill

647
00:30:44,880 --> 00:30:46,960
or judgment to select suitable 
goods. 

648
00:30:47,320 --> 00:30:50,040
The seller doesn't have to be a 
merchant for this one, but often

649
00:30:50,040 --> 00:30:51,960
is. 
Like asking a hardware store 

650
00:30:51,960 --> 00:30:55,000
employee for paint specifically 
for a damp basement. 

651
00:30:55,160 --> 00:30:58,000
Perfect example, if they 
recommend a paint knowing your 

652
00:30:58,000 --> 00:31:01,240
specific need and your reliance,
there's an implied warranty it's

653
00:31:01,240 --> 00:31:04,040
fit for that particular purpose.
Can sellers get out of these 

654
00:31:04,040 --> 00:31:05,920
warranties? 
Can they disclaim them? 

655
00:31:06,240 --> 00:31:10,720
Yes, but the rules are specific.
To disclaim the implied warranty

656
00:31:10,720 --> 00:31:13,680
of merchantability, the 
disclaimer generally must 

657
00:31:13,680 --> 00:31:16,800
actually use the word 
merchantability, and if in 

658
00:31:16,800 --> 00:31:19,960
writing must be conspicuous, 
like in bold print or a 

659
00:31:19,960 --> 00:31:22,600
different color. 
To disclaim the implied warranty

660
00:31:22,600 --> 00:31:26,200
of fitness, the disclaimer must 
be in writing and conspicuous, 

661
00:31:26,400 --> 00:31:28,760
but specific language isn't 
required. 

662
00:31:28,880 --> 00:31:33,160
General phrases like as is or 
with all faults can also 

663
00:31:33,160 --> 00:31:35,480
effectively disclaim all implied
warranties. 

664
00:31:35,560 --> 00:31:38,120
Express warranties are harder to
disclaim once made. 

665
00:31:38,120 --> 00:31:40,600
OK, good to know of those 
disclaimer rules now. 

666
00:31:40,600 --> 00:31:43,040
A really practical and 
frequently tested issue. 

667
00:31:43,440 --> 00:31:46,280
Risk of loss. 
Who bears the loss if goods are 

668
00:31:46,280 --> 00:31:48,840
damaged or destroyed before the 
buyer gets them, and it's 

669
00:31:48,840 --> 00:31:50,960
nobody's fault. 
This is crucial, it determines 

670
00:31:50,960 --> 00:31:53,000
who has to deal with the 
insurance or take the financial 

671
00:31:53,000 --> 00:31:55,160
hit. 
The 1st place to look is always 

672
00:31:55,160 --> 00:31:58,360
the contract terms. 
Did the parties explicitly agree

673
00:31:58,360 --> 00:32:01,360
on when risk passes? 
Maybe using terms like FoB or 

674
00:32:01,360 --> 00:32:02,400
CAF? 
FOB. 

675
00:32:02,400 --> 00:32:03,120
What do those mean? 
Again? 

676
00:32:03,520 --> 00:32:07,080
FoB. 
Stands for free on board FoB, 

677
00:32:07,160 --> 00:32:09,480
seller's place of business or 
city. 

678
00:32:09,760 --> 00:32:13,160
Creates A shipment contract. 
This is the default rule under 

679
00:32:13,160 --> 00:32:15,160
the UCC if the contract is 
silent. 

680
00:32:15,680 --> 00:32:19,320
In a shipment contract, the risk
of loss passes to the buyer as 

681
00:32:19,320 --> 00:32:22,400
soon as the seller delivers the 
goods to the carrier, like UPS 

682
00:32:22,400 --> 00:32:25,280
or a trucking company. 
So once it's on the truck, it's 

683
00:32:25,280 --> 00:32:28,000
the buyer's problem. 
Essentially, yes, for risk of 

684
00:32:28,000 --> 00:32:32,040
loss purposes in a shipment 
contract, FoB buyer's place of 

685
00:32:32,040 --> 00:32:35,480
business or city creates a 
destination contract. 

686
00:32:35,680 --> 00:32:39,160
Here, the risk of loss stays 
with the seller until the goods 

687
00:32:39,160 --> 00:32:42,120
actually arrive at the specified
destination and are properly 

688
00:32:42,120 --> 00:32:44,640
tendered to the buyer. 
So the seller is responsible 

689
00:32:44,640 --> 00:32:47,680
during transit in a destination 
contract, correct? 

690
00:32:48,000 --> 00:32:49,560
What if there's no carrier 
involved? 

691
00:32:49,560 --> 00:32:52,320
Like I buy furniture from a 
local store and plan to pick it 

692
00:32:52,320 --> 00:32:53,800
up myself. 
Good question. 

693
00:32:53,800 --> 00:32:57,080
In these non carrier cases, the 
rule depends on whether the 

694
00:32:57,080 --> 00:32:59,960
seller is a merchant. 
If the seller is a merchant, the

695
00:32:59,960 --> 00:33:03,280
risk of loss doesn't pass to the
buyer until the buyer actually 

696
00:33:03,280 --> 00:33:04,920
takes physical possession of the
goods. 

697
00:33:04,920 --> 00:33:07,480
So even if I've paid, if it's 
still at the merchant's store, 

698
00:33:07,480 --> 00:33:10,320
it's their risk. 
Right, but if the seller is a 

699
00:33:10,320 --> 00:33:13,760
non merchant, like a private 
individual selling their used 

700
00:33:13,760 --> 00:33:18,240
car, the risk passes to the 
buyer much earlier upon tender 

701
00:33:18,240 --> 00:33:21,160
of delivery. 
That means once the seller makes

702
00:33:21,160 --> 00:33:23,840
the goods available for the 
buyer to pick up and notifies 

703
00:33:23,840 --> 00:33:27,320
them, the risk shifts even if 
the buyer hasn't actually picked

704
00:33:27,320 --> 00:33:29,160
them up yet. 
Interesting distinction. 

705
00:33:29,440 --> 00:33:33,960
And how do sale on approval and 
sale or return fit in? 

706
00:33:34,120 --> 00:33:37,280
These are specific types of 
sales affecting risk of loss. 

707
00:33:37,800 --> 00:33:40,920
In a sale on approval, the buyer
takes goods mainly for their own

708
00:33:40,920 --> 00:33:43,880
use, but gets to try them out 
first, like art for a home. 

709
00:33:44,120 --> 00:33:46,920
The risk of loss stays with the 
seller until the buyer actually 

710
00:33:46,920 --> 00:33:50,640
approves or accepts the goods. 
OK, seller keeps risk during 

711
00:33:50,640 --> 00:33:53,120
trial. 
In a sale or return, the buyer 

712
00:33:53,120 --> 00:33:56,080
takes goods mainly for resale, 
but has the right to return them

713
00:33:56,080 --> 00:33:59,200
if they don't sell. 
Common with retailers here, the 

714
00:33:59,200 --> 00:34:02,480
risk of loss passes to the buyer
upon delivery and stays with the

715
00:34:02,480 --> 00:34:05,040
buyer until the goods are 
actually returned to the seller.

716
00:34:05,280 --> 00:34:07,640
So the retailer bears the risk 
while the goods are on their 

717
00:34:07,640 --> 00:34:09,040
shelves. 
Exactly. 

718
00:34:09,360 --> 00:34:12,440
These rules are often tested 
with goods damaged in transit or

719
00:34:12,440 --> 00:34:14,760
while in the buyer's possession.
All right, let's wrap up 

720
00:34:15,719 --> 00:34:17,560
contracts with remedies for 
breach. 

721
00:34:18,560 --> 00:34:21,920
The goal here is always to put 
the non breaching party in the 

722
00:34:21,920 --> 00:34:24,320
position they would have been in
if the contract had been 

723
00:34:24,320 --> 00:34:26,199
performed right. 
Make them whole. 

724
00:34:26,719 --> 00:34:29,960
That's the fundamental principle
of contract damages, and under 

725
00:34:29,960 --> 00:34:32,480
the UCC remedies are generally 
cumulative. 

726
00:34:33,080 --> 00:34:36,000
The non breaching party can 
often pursue multiple remedies 

727
00:34:36,000 --> 00:34:38,040
as long as it doesn't lead to 
double recovery. 

728
00:34:38,280 --> 00:34:42,280
So what can the seller do if the
buyer breaches, say, wrongfully 

729
00:34:42,280 --> 00:34:45,840
rejects goods or fails to pay? 
The seller has several options. 

730
00:34:45,920 --> 00:34:48,560
They can withhold delivery, 
cancel the contract, or stop 

731
00:34:48,560 --> 00:34:50,840
goods that are already in 
transit with a carrier. 

732
00:34:51,120 --> 00:34:53,800
If they still have the goods, 
they can resell them in a 

733
00:34:53,800 --> 00:34:56,080
commercially reasonable manner 
and recover the difference 

734
00:34:56,080 --> 00:34:59,520
between the resale price and the
original contract price, plus 

735
00:34:59,520 --> 00:35:01,880
any incidental damages like 
costs of the resale. 

736
00:35:01,880 --> 00:35:04,320
What if they don't resell? 
Then they can sue for market 

737
00:35:04,320 --> 00:35:07,200
damages, the difference between 
the market price at the time and

738
00:35:07,200 --> 00:35:10,160
place for tender and the unpaid 
contract price, plus 

739
00:35:10,160 --> 00:35:13,520
incidentals. 
Or in specific situations, like 

740
00:35:13,520 --> 00:35:16,960
if the buyer accepted the goods,
or if conforming goods were lost

741
00:35:16,960 --> 00:35:19,440
after risk passed to the buyer 
and the seller can't resell 

742
00:35:19,440 --> 00:35:22,320
them, the seller can sue for the
full contract price. 

743
00:35:22,480 --> 00:35:26,360
OK, now what about the buyers 
remedies when the seller 

744
00:35:26,360 --> 00:35:30,560
breaches, fails to deliver or 
delivers nonconforming goods? 

745
00:35:31,080 --> 00:35:33,320
The buyer's main remedies 
revolve around getting 

746
00:35:33,320 --> 00:35:35,280
substitute goods or 
compensation. 

747
00:35:35,600 --> 00:35:37,400
The preferred remedy is often 
cover. 

748
00:35:37,680 --> 00:35:41,520
The buyer can, in good faith and
without unreasonable delay, buy 

749
00:35:41,520 --> 00:35:44,280
substitute goods and recover the
difference between the cost of 

750
00:35:44,280 --> 00:35:47,560
cover and the original contract 
price, plus incidental and 

751
00:35:47,560 --> 00:35:49,800
consequential damages. 
Is cover mandatory? 

752
00:35:49,880 --> 00:35:52,440
No cover is optional. 
If the buyer doesn't cover or 

753
00:35:52,440 --> 00:35:55,320
can't reasonably cover, they can
sue for market damages. 

754
00:35:55,760 --> 00:35:57,560
The difference between the 
market price at the time the 

755
00:35:57,560 --> 00:36:00,560
buyer learned of the breach and 
the contract price, plus 

756
00:36:00,560 --> 00:36:03,840
incidentals and consequentials. 
What if damages aren't enough, 

757
00:36:04,280 --> 00:36:07,400
like for unique goods? 
Then the buyer might seek 

758
00:36:07,400 --> 00:36:10,880
specific performance and 
equitable remedy, ordering the 

759
00:36:10,880 --> 00:36:13,480
seller to actually deliver the 
specific goods. 

760
00:36:13,760 --> 00:36:17,040
This is usually only available 
for unique goods like rare art, 

761
00:36:17,080 --> 00:36:20,720
antiques, custom made items, or 
another proper circumstances 

762
00:36:20,720 --> 00:36:22,760
where monetary damages are 
inadequate. 

763
00:36:23,120 --> 00:36:26,240
There's also replven, allowing 
the buyer to recover identified 

764
00:36:26,240 --> 00:36:29,640
goods if they can't cover. 
And, as we mentioned, revocation

765
00:36:29,640 --> 00:36:32,680
of acceptance is also a remedy 
after goods have been accepted 

766
00:36:32,680 --> 00:36:35,720
under certain conditions. 
You mentioned consequential 

767
00:36:35,720 --> 00:36:37,320
damages for buyers. 
Yeah. 

768
00:36:37,440 --> 00:36:39,960
What are those and when are they
recoverable? 

769
00:36:40,480 --> 00:36:43,480
They seem potentially huge. 
They can be consequential 

770
00:36:43,480 --> 00:36:46,280
damages are losses resulting 
from the buyer's particular 

771
00:36:46,280 --> 00:36:49,040
requirements and needs that the 
seller had reason to know about 

772
00:36:49,040 --> 00:36:52,000
at the time of contracting. 
They go beyond the direct loss 

773
00:36:52,000 --> 00:36:53,600
in value of the goods 
themselves. 

774
00:36:53,840 --> 00:36:56,680
Think lost profits on resale 
contracts the buyer couldn't 

775
00:36:56,680 --> 00:36:59,520
fulfill, or damages from 
personal injury or property 

776
00:36:59,520 --> 00:37:01,080
damage caused by defective 
goods. 

777
00:37:01,080 --> 00:37:03,040
Are they always recoverable? 
No. 

778
00:37:03,040 --> 00:37:06,880
They must meet three tests. 
One, the loss resulted from the 

779
00:37:06,880 --> 00:37:10,440
seller's breach. 2 The loss was 
foreseeable to the seller at the

780
00:37:10,440 --> 00:37:14,680
time of contracting AN D3. 
The buyer couldn't reasonably 

781
00:37:14,680 --> 00:37:17,000
have prevented the loss by cover
or otherwise. 

782
00:37:17,360 --> 00:37:20,280
Duty to mitigate. 
OK, one last UCC point. 

783
00:37:20,680 --> 00:37:23,880
The statute of Frauds, we know 
it applies to sales of goods for

784
00:37:23,880 --> 00:37:27,760
$500 or more requiring a writing
sign by the party being charged.

785
00:37:28,160 --> 00:37:29,320
But the exceptions are key, 
right? 

786
00:37:29,320 --> 00:37:31,080
Especially that merchants 
confirmatory memo. 

787
00:37:31,440 --> 00:37:34,000
Absolutely critical. 
The general rule sale of goods 

788
00:37:34,000 --> 00:37:38,680
$500 plus Nita writing showing a
contract stating quantity signed

789
00:37:38,680 --> 00:37:40,840
by the defendant. 
But the exceptions often drive 

790
00:37:40,840 --> 00:37:43,360
the analysis on exams. 
And that merchants confirmatory 

791
00:37:43,360 --> 00:37:45,920
memo exception UCC 2 two over 
1-2. 

792
00:37:46,080 --> 00:37:48,800
The goat bar prep source called 
it a huge EE trap. 

793
00:37:49,080 --> 00:37:50,640
Why? 
What's the detail everyone 

794
00:37:50,640 --> 00:37:52,960
misses? 
It's a trap because people focus

795
00:37:52,960 --> 00:37:55,880
on the recipient merchant not 
objecting within 10 days. 

796
00:37:56,440 --> 00:37:59,840
But the exception only works if 
the written confirmation sent by

797
00:37:59,840 --> 00:38:02,440
the other merchant was it 
self-sufficient to bind the 

798
00:38:02,440 --> 00:38:06,240
sender, meaning it had to 
indicate a contract state of 

799
00:38:06,240 --> 00:38:08,240
quantity and be signed by the 
sender. 

800
00:38:08,600 --> 00:38:11,720
If the sender's memo wasn't 
sufficient against them, their 

801
00:38:11,720 --> 00:38:15,520
failure to object means nothing.
So in that shopping cart me 

802
00:38:15,520 --> 00:38:19,240
scenario, right, if the grocer 
sent an unsigned note confirming

803
00:38:19,240 --> 00:38:22,400
the order, even if the supplier 
didn't object, the contract 

804
00:38:22,400 --> 00:38:24,760
wouldn't be enforceable against 
the supplier under this 

805
00:38:24,760 --> 00:38:25,800
exception. 
Precisely. 

806
00:38:25,800 --> 00:38:27,800
The memo has to be good against 
the sender first. 

807
00:38:27,880 --> 00:38:30,200
That's the trap. 
Always check if the sender's 

808
00:38:30,200 --> 00:38:32,960
memo meets the Statute of Frauds
requirements against the sender.

809
00:38:33,040 --> 00:38:34,600
Got it. 
What are the other main 

810
00:38:34,600 --> 00:38:38,120
exceptions? 
Specially manufactured goods if 

811
00:38:38,120 --> 00:38:40,920
goods are custom made for the 
buyer and aren't suitable for 

812
00:38:40,920 --> 00:38:43,880
sale to others in the ordinary 
course, and the seller has made 

813
00:38:43,880 --> 00:38:46,400
a substantial beginning on 
manufacturing them or 

814
00:38:46,400 --> 00:38:47,800
commitments for their 
procurement. 

815
00:38:48,160 --> 00:38:51,880
Admission in court If the party 
being sued admit some pleadings,

816
00:38:51,880 --> 00:38:54,880
testimony, or otherwise in court
that a contract for sale was 

817
00:38:54,880 --> 00:38:58,600
made and part performance, the 
contract is enforceable to the 

818
00:38:58,600 --> 00:39:01,920
extent that payment has been 
made and accepted or goods have 

819
00:39:01,920 --> 00:39:04,600
been received and accepted. 
OK, those exceptions are vital. 

820
00:39:04,760 --> 00:39:07,880
That wraps up a deep dive into 
contracts and UCC. 

821
00:39:08,560 --> 00:39:11,320
Now let's turn to the road map 
of litigation itself. 

822
00:39:11,720 --> 00:39:14,680
Civil Procedure. 
This isn't just about rules. 

823
00:39:14,840 --> 00:39:17,440
It's about the fundamental power
and limits of the courts. 

824
00:39:17,840 --> 00:39:20,720
Mastering this is non negotiable
for the bar. 

825
00:39:20,880 --> 00:39:23,320
Couldn't agree more. 
SIF Pro is the framework for 

826
00:39:23,320 --> 00:39:25,800
everything else and it starts 
with jurisdiction, the court's 

827
00:39:25,800 --> 00:39:27,880
power. 
We need to think about power 

828
00:39:27,880 --> 00:39:31,120
over the case subject matter 
jurisdiction and power over the 

829
00:39:31,120 --> 00:39:34,440
person personal jurisdiction. 
Let's start with subject matter 

830
00:39:34,440 --> 00:39:37,240
jurisdiction. 
SMJ power over the case type. 

831
00:39:37,560 --> 00:39:40,280
What's the absolute number one 
thing students must remember 

832
00:39:40,280 --> 00:39:43,040
about SMJ? 
It cannot be waived, ever. 

833
00:39:43,480 --> 00:39:46,960
Parties can't agree to give a 
federal court SMJ if it doesn't 

834
00:39:46,960 --> 00:39:49,400
constitutionally or statutorily 
exist. 

835
00:39:50,040 --> 00:39:53,240
It can be raised by any party or
the court itself at any stage of

836
00:39:53,240 --> 00:39:55,720
the litigation, even on appeal, 
for the first time. 

837
00:39:56,040 --> 00:39:59,000
If a court enters judgment 
without SMJ, that judgment is 

838
00:39:59,000 --> 00:40:00,600
void. 
It's fundamental. 

839
00:40:00,720 --> 00:40:03,040
OK non waivable can be raised 
anytime. 

840
00:40:03,360 --> 00:40:06,160
What are the main ways a federal
court gets SMJ? 

841
00:40:06,200 --> 00:40:09,320
Two primary ways federal 
question jurisdiction and 

842
00:40:09,320 --> 00:40:11,720
diversity jurisdiction. 
Federal question First, what 

843
00:40:11,720 --> 00:40:14,600
does arising under federal law 
mean? 

844
00:40:14,840 --> 00:40:17,600
It means the plaintiff's claim 
itself is based on the US 

845
00:40:17,600 --> 00:40:19,960
Constitution, a federal statute 
or a treaty. 

846
00:40:20,600 --> 00:40:22,800
The federal issue must be 
central to the plaintiff's 

847
00:40:22,800 --> 00:40:25,120
claim, not just a potential 
defense the defendant might 

848
00:40:25,120 --> 00:40:27,120
raise. 
It has to appear on the face of 

849
00:40:27,120 --> 00:40:29,880
the well pleaded complaint. 
OK, the claim itself has to 

850
00:40:29,880 --> 00:40:32,320
involve federal law. 
Yeah, diversity jurisdiction. 

851
00:40:32,320 --> 00:40:34,280
This one seems more complex with
two parts. 

852
00:40:34,440 --> 00:40:39,440
It is for diversity jurisdiction
under 28 USC Section 1332. 

853
00:40:39,760 --> 00:40:43,200
You you need two things. 
First, complete diversity of 

854
00:40:43,200 --> 00:40:46,480
citizenship between the 
plaintiffs and defendants, and 

855
00:40:46,480 --> 00:40:50,720
second, the amount in 
controversy must exceed $75,000,

856
00:40:50,800 --> 00:40:54,240
exclusive of interest and costs.
Complete diversity. 

857
00:40:54,240 --> 00:40:57,560
What does that mean exactly? 
It means no plaintiff can be a 

858
00:40:57,560 --> 00:40:59,960
citizen of the same state as any
defendant. 

859
00:41:00,080 --> 00:41:02,960
If even 1 plaintiff and one 
defendant share state 

860
00:41:02,960 --> 00:41:05,600
citizenship, diversity is 
destroyed. 

861
00:41:05,600 --> 00:41:07,440
And when is this citizenship 
determined? 

862
00:41:07,520 --> 00:41:10,520
At the time the lawsuit is 
filed, later changes generally 

863
00:41:10,520 --> 00:41:13,520
don't matter for jurisdiction. 
How do we determine citizenship 

864
00:41:13,520 --> 00:41:15,680
for individuals? 
It's domicile, right? 

865
00:41:15,880 --> 00:41:18,680
Physical presence plus intent to
remain indefinitely. 

866
00:41:18,680 --> 00:41:20,880
Correct. 
For individuals, it's domicile. 

867
00:41:20,880 --> 00:41:22,840
For corporations, it's more 
complicated. 

868
00:41:22,880 --> 00:41:24,760
They're citizens of both the 
state where they are 

869
00:41:24,760 --> 00:41:27,440
incorporated and the state where
they have their principal place 

870
00:41:27,440 --> 00:41:29,400
of business. 
Principal place of business is 

871
00:41:29,400 --> 00:41:31,960
that the nerve center? 
Yes, the Supreme Court adopted 

872
00:41:31,960 --> 00:41:34,200
the nerve center test. 
It's typically the corporate 

873
00:41:34,200 --> 00:41:37,120
headquarters where the high 
level officers direct control 

874
00:41:37,120 --> 00:41:39,040
and coordinate the corporation's
activities. 

875
00:41:39,280 --> 00:41:42,720
Now, what about unincorporated 
entities like partnerships or 

876
00:41:42,720 --> 00:41:45,280
LLC's? 
This seems to trip people up. 

877
00:41:45,400 --> 00:41:47,600
It does, and it's a huge deal 
for diversity. 

878
00:41:47,640 --> 00:41:50,480
For Partnerships, LLC's and 
other unincorporated 

879
00:41:50,480 --> 00:41:54,120
associations, citizenship is 
determined by the citizenship of

880
00:41:54,120 --> 00:41:57,880
all of its members or partners. 
So if an LLC has members in all 

881
00:41:57,880 --> 00:42:00,920
50 states, it's considered a 
citizen of all 50 states for 

882
00:42:00,920 --> 00:42:04,840
diversity purposes, making it 
very hard to sue or be sued in 

883
00:42:04,840 --> 00:42:06,800
federal court based on 
diversity. 

884
00:42:06,800 --> 00:42:08,680
Wow, that's a massive difference
from corporations. 

885
00:42:08,680 --> 00:42:10,640
It really limits diversity 
jurisdiction for them. 

886
00:42:10,640 --> 00:42:12,440
It absolutely does. 
What about the amount in 

887
00:42:12,440 --> 00:42:16,520
controversy over $75,000? 
How strictly is that applied? 

888
00:42:16,920 --> 00:42:19,720
The plaintiffs good faith claim 
for damages is generally 

889
00:42:19,720 --> 00:42:23,040
accepted unless it appears to a 
legal certainty that they cannot

890
00:42:23,040 --> 00:42:24,600
recover the jurisdictional 
amount. 

891
00:42:25,120 --> 00:42:27,960
A single plaintiff can aggregate
all claims they have against a 

892
00:42:27,960 --> 00:42:30,600
single defendant to meet the 
amount, even if unrelated. 

893
00:42:31,080 --> 00:42:34,000
Multiple plaintiffs usually 
cannot aggregate claims unless 

894
00:42:34,000 --> 00:42:36,880
they are seeking to enforce a 
single title or right in which 

895
00:42:36,880 --> 00:42:39,040
they have a common undivided 
interest. 

896
00:42:39,280 --> 00:42:43,640
OK, what if a case has a federal
claim, but also related state 

897
00:42:43,640 --> 00:42:46,120
law claims? 
Can the Federal Court hear those

898
00:42:46,120 --> 00:42:48,560
two supplemental jurisdiction? 
Yes. 

899
00:42:48,560 --> 00:42:53,280
Under 28 USC Section 1367, if a 
federal court has original 

900
00:42:53,280 --> 00:42:55,800
jurisdiction over a claim, 
either federal question or 

901
00:42:55,800 --> 00:42:58,680
diversity, it can exercise 
supplemental jurisdiction over 

902
00:42:58,680 --> 00:43:01,440
related state law claims that 
arise from the same common 

903
00:43:01,440 --> 00:43:04,440
nucleus of operative fact. 
Basically, if the claims are so 

904
00:43:04,440 --> 00:43:06,480
related, they'd ordinarily be 
tried together. 

905
00:43:06,480 --> 00:43:08,160
Does that work in diversity 
cases too? 

906
00:43:08,160 --> 00:43:11,160
Can a plaintiff use it to sue a 
non diverse defendant on a 

907
00:43:11,160 --> 00:43:13,080
related state claim? 
Generally, no. 

908
00:43:13,120 --> 00:43:16,640
There are important statutory 
limitations in diversity cases. 

909
00:43:17,000 --> 00:43:20,320
Section 1367 B typically 
prevents plaintiffs from using 

910
00:43:20,320 --> 00:43:23,240
supplemental jurisdiction to 
bring in claims against parties 

911
00:43:23,240 --> 00:43:25,840
who would destroy complete 
diversity, like third party 

912
00:43:25,840 --> 00:43:29,160
defendants and pleaded under 
Rule 14 or party is joined under

913
00:43:29,160 --> 00:43:32,440
Rules 1920 or 24. 
It prevents plaintiffs from end 

914
00:43:32,440 --> 00:43:34,280
running the complete diversity 
requirement. 

915
00:43:34,280 --> 00:43:37,200
OK, tricky limitations there. 
Now, what if a case could have 

916
00:43:37,200 --> 00:43:40,240
been brought in federal court, 
but the plaintiff filed in state

917
00:43:40,240 --> 00:43:41,640
court? 
Can the defendant move it? 

918
00:43:41,800 --> 00:43:43,000
Removal. 
Yes. 

919
00:43:43,800 --> 00:43:46,400
Defendants generally have the 
right to remove a case from 

920
00:43:46,400 --> 00:43:49,160
state court to the federal 
District Court, embracing the 

921
00:43:49,160 --> 00:43:52,320
place where the state action is 
pending if the case could have 

922
00:43:52,320 --> 00:43:55,800
originally been filed in federal
court, IE if there's federal 

923
00:43:55,800 --> 00:43:58,080
question or diversity 
jurisdiction. 

924
00:43:58,360 --> 00:44:02,600
Do all defendants have to agree?
Yes, generally all defendants 

925
00:44:02,600 --> 00:44:05,880
who have been properly joined 
and served must consent to 

926
00:44:05,880 --> 00:44:08,440
removal, and there's a strict 
time limit. 

927
00:44:09,200 --> 00:44:12,560
Notice of removal must usually 
be filed within 30 days of the 

928
00:44:12,560 --> 00:44:15,040
defendant receiving the initial 
pleading or summons. 

929
00:44:15,280 --> 00:44:18,480
Now here's that interesting 
exception again, the home state 

930
00:44:18,480 --> 00:44:21,440
defendant rule. 
How does that block removal? 

931
00:44:21,760 --> 00:44:25,120
This is a statutory limitation 
that applies only in diversity 

932
00:44:25,120 --> 00:44:27,120
cases. 
Even if complete diversity 

933
00:44:27,120 --> 00:44:29,880
exists and the amount in 
controversy is met, the case 

934
00:44:29,880 --> 00:44:32,400
cannot be removed if any. 
Properly joined and served 

935
00:44:32,400 --> 00:44:34,600
defendant is a citizen of the 
state where the action was 

936
00:44:34,600 --> 00:44:37,080
filed. 
The idea is if a defendant is 

937
00:44:37,080 --> 00:44:39,760
being sued in their home state 
court, there's less concern 

938
00:44:39,760 --> 00:44:42,760
about local bias, so they don't 
need the protection of a federal

939
00:44:42,760 --> 00:44:44,440
forum. 
That's a big one to remember for

940
00:44:44,440 --> 00:44:47,240
diversity removals. 
What if removal is improper? 

941
00:44:47,320 --> 00:44:49,360
Can the plaintiff send it back 
remand? 

942
00:44:49,680 --> 00:44:51,840
Yes. 
If the plaintiff believes 

943
00:44:51,840 --> 00:44:54,960
removal was defective, museum 
procedure wasn't followed, 

944
00:44:54,960 --> 00:44:58,960
deadline missed, or the federal 
court lacks SMJ, they can file a

945
00:44:58,960 --> 00:45:01,400
motion to remand the case back 
to state court. 

946
00:45:01,800 --> 00:45:05,000
Motions based on procedural 
defects must be made within 30 

947
00:45:05,000 --> 00:45:08,440
days after the notice of removal
was filed, but a motion to 

948
00:45:08,440 --> 00:45:12,480
remand based on lack of SMJ can 
be made at any time before final

949
00:45:12,480 --> 00:45:13,400
judgment. 
OK. 

950
00:45:13,400 --> 00:45:17,480
That covers SMJ and removal. 
No personal jurisdiction. 

951
00:45:18,120 --> 00:45:20,640
PJ. 
This is about the courts power 

952
00:45:20,640 --> 00:45:23,480
over the defendant themselves. 
Fair process for the litigant. 

953
00:45:23,640 --> 00:45:26,000
Exactly. 
For a court to have PJ over a 

954
00:45:26,000 --> 00:45:29,240
defendant, it must satisfy both 
the states long arm statute, 

955
00:45:29,440 --> 00:45:32,480
which authorizes jurisdiction 
over non residents under certain

956
00:45:32,480 --> 00:45:36,120
circumstances, and the due 
process clause of the 14th 

957
00:45:36,120 --> 00:45:38,240
Amendment. 
Due process requires that the 

958
00:45:38,240 --> 00:45:41,080
defendant have sufficient 
minimum contacts with the forum 

959
00:45:41,080 --> 00:45:44,240
state such that exercising 
jurisdiction doesn't offend 

960
00:45:44,240 --> 00:45:46,960
traditional notions of Fair play
and substantial justice. 

961
00:45:46,960 --> 00:45:49,120
Minimum contacts? 
That sounds like the core test. 

962
00:45:49,400 --> 00:45:52,040
What are the different types of 
PGA based on those contacts? 

963
00:45:52,040 --> 00:45:54,520
We generally talk about two 
types, general jurisdiction and 

964
00:45:54,520 --> 00:45:56,800
specific jurisdiction. 
General first, when does that 

965
00:45:56,800 --> 00:45:59,440
apply? 
General jurisdiction exists when

966
00:45:59,440 --> 00:46:02,480
the defendant's affiliations 
with the forum state are so 

967
00:46:02,480 --> 00:46:06,680
continuous and systematic as to 
render them essentially at home.

968
00:46:06,680 --> 00:46:10,320
There, if a court has general 
jurisdiction, it can hear any 

969
00:46:10,320 --> 00:46:13,480
claim against the defendant, 
even if the claim runs totally 

970
00:46:13,600 --> 00:46:17,760
outside the forum state. 
Where is a defendant at home? 

971
00:46:17,840 --> 00:46:19,960
For an individual, it's their 
domicile. 

972
00:46:20,120 --> 00:46:23,200
For a corporation, it's their 
state of incorporation and their

973
00:46:23,200 --> 00:46:25,360
principal place of business. 
Nerve center. 

974
00:46:25,600 --> 00:46:28,160
It's very high bar. 
General jurisdiction is rare 

975
00:46:28,160 --> 00:46:29,440
outside these places. 
OK. 

976
00:46:29,640 --> 00:46:33,800
So what's specific jurisdiction?
Specific jurisdiction is case 

977
00:46:33,800 --> 00:46:36,080
specific. 
It exists if the defendant's 

978
00:46:36,080 --> 00:46:39,280
contacts with the forum state 
gave rise to the actual claim 

979
00:46:39,280 --> 00:46:42,160
being sued upon. 
The lawsuit must arise out of or

980
00:46:42,160 --> 00:46:44,520
relate to the defendant's 
contacts with the forum. 

981
00:46:44,520 --> 00:46:46,920
And how do we determine if those
contacts are sufficient for 

982
00:46:46,920 --> 00:46:50,400
specific jurisdiction under due 
process that minimum contacts 

983
00:46:50,400 --> 00:46:51,640
test again? 
Yes. 

984
00:46:52,360 --> 00:46:54,760
The modern test involves 3 key 
elements. 

985
00:46:55,120 --> 00:46:58,440
First, did the defendant 
purposefully avail themselves of

986
00:46:58,440 --> 00:47:00,960
the privilege of conducting 
activities within the forum 

987
00:47:00,960 --> 00:47:03,960
state, thus invoking the 
benefits and protections of its 

988
00:47:03,960 --> 00:47:06,520
laws? 
This requires some deliberate 

989
00:47:06,520 --> 00:47:09,400
action directed towards the 
forum, not just random or 

990
00:47:09,400 --> 00:47:11,720
accidental contact. 
Purposeful availment. 

991
00:47:11,960 --> 00:47:14,120
What else? 
Second, does the plaintiff's 

992
00:47:14,120 --> 00:47:17,480
claim arise out of or relate to 
the defendant's contacts with 

993
00:47:17,480 --> 00:47:19,640
the forum? 
There needs to be a connection 

994
00:47:19,640 --> 00:47:21,720
between the form contacts and 
the lawsuit. 

995
00:47:21,920 --> 00:47:25,600
Connection between contacts and 
claim and 3rd. 3rd Would the 

996
00:47:25,600 --> 00:47:28,480
exercise of jurisdiction be 
reasonable and consistent with 

997
00:47:28,480 --> 00:47:30,400
fair play and substantial 
justice? 

998
00:47:30,880 --> 00:47:34,720
Courts sway several factors here
the burden on the defendant, the

999
00:47:34,720 --> 00:47:37,640
forum states, interest in the 
case, the plaintiff's interest 

1000
00:47:37,640 --> 00:47:40,400
in obtaining relief, the 
efficiency of the Interstate 

1001
00:47:40,400 --> 00:47:43,160
judicial system, and the shared 
interests of the states. 

1002
00:47:43,280 --> 00:47:45,360
What about just putting a 
product into the stream of 

1003
00:47:45,360 --> 00:47:47,400
commerce? 
Is that enough for purposeful of

1004
00:47:47,400 --> 00:47:49,280
ailment? 
Often, no. 

1005
00:47:49,840 --> 00:47:52,680
The Supreme Court has suggested 
that merely placing a product 

1006
00:47:52,680 --> 00:47:55,360
into the stream of commerce, 
even knowing it might end up in 

1007
00:47:55,360 --> 00:47:59,040
the forum state, isn't enough. 
There usually needs to be some 

1008
00:47:59,040 --> 00:48:02,000
additional conduct indicating an
intent to target the forum 

1009
00:48:02,000 --> 00:48:05,400
state, like advertising there, 
designing the product for that 

1010
00:48:05,400 --> 00:48:08,600
market, or establishing customer
service channels there. 

1011
00:48:08,600 --> 00:48:10,840
OK. 
Finally, even if jurisdiction 

1012
00:48:10,840 --> 00:48:14,120
exists, the defendant needs 
proper notice right service of 

1013
00:48:14,120 --> 00:48:17,200
process. 
Absolutely essential due process

1014
00:48:17,200 --> 00:48:20,000
requires notice reasonably 
calculated under all the 

1015
00:48:20,000 --> 00:48:23,000
circumstances to apprise 
interested parties of the 

1016
00:48:23,000 --> 00:48:25,720
pendency of the action and 
afford them an opportunity to 

1017
00:48:25,720 --> 00:48:28,920
present their objections. 
This notice is typically 

1018
00:48:28,920 --> 00:48:31,960
achieved through service of 
process formally delivering the 

1019
00:48:31,960 --> 00:48:34,280
summons and complaint to the 
defendant according to the 

1020
00:48:34,280 --> 00:48:35,720
rules. 
And how's that done? 

1021
00:48:35,840 --> 00:48:38,960
Federal Rule of Civil Procedure 
for govern service in federal 

1022
00:48:38,960 --> 00:48:41,120
court. 
It allows various methods 

1023
00:48:41,120 --> 00:48:43,640
including personal delivery, 
leaving copies at the 

1024
00:48:43,640 --> 00:48:45,800
defendant's dwelling with 
someone of suitable age and 

1025
00:48:45,800 --> 00:48:48,200
discretion who resides there, 
delivering copies to an 

1026
00:48:48,200 --> 00:48:51,720
authorized agent, or using any 
method permitted by the state 

1027
00:48:51,720 --> 00:48:54,600
law where the federal court sits
or where service is made. 

1028
00:48:54,920 --> 00:48:57,840
Proper service is crucial. 
Without it, the court can't 

1029
00:48:57,840 --> 00:48:59,920
exercise its jurisdiction over 
the defendant. 

1030
00:49:00,200 --> 00:49:02,800
OK, jurisdiction covered, now 
venue. 

1031
00:49:03,200 --> 00:49:05,600
This isn't about power, but 
about location. 

1032
00:49:05,800 --> 00:49:08,160
Which specific federal 
courthouse is the right place 

1033
00:49:08,160 --> 00:49:09,520
for the lawsuit? 
Exactly. 

1034
00:49:09,640 --> 00:49:12,640
Venue is primarily about 
convenience and location. 

1035
00:49:12,640 --> 00:49:15,720
It's a statutory requirement, 
not constitutional. 

1036
00:49:15,720 --> 00:49:18,520
So where is venue generally 
proper in federal court? 

1037
00:49:18,720 --> 00:49:24,280
Under 28 USC Section 1391, venue
is proper in one a judicial 

1038
00:49:24,280 --> 00:49:27,160
district where any defendant 
resides, if all defense reside 

1039
00:49:27,160 --> 00:49:29,880
in the same state, or 2A 
judicial district where a 

1040
00:49:29,880 --> 00:49:32,640
substantial part of the events 
or omissions giving rise to the 

1041
00:49:32,640 --> 00:49:36,120
claim occurred, or where a 
substantial part of the property

1042
00:49:36,120 --> 00:49:38,320
that is the subject of the 
action is situated. 

1043
00:49:38,600 --> 00:49:42,000
What if neither of those works? 
Then, as a fall back, if there's

1044
00:49:42,000 --> 00:49:45,480
no district where the action may
otherwise be brought, venue is 

1045
00:49:45,480 --> 00:49:48,600
proper in any judicial district 
in which any defendant is 

1046
00:49:48,600 --> 00:49:51,200
subject to the court's personal 
jurisdiction with respect to 

1047
00:49:51,200 --> 00:49:54,120
such action. 
What if venue is technically 

1048
00:49:54,120 --> 00:49:56,320
proper but it's really 
inconvenient? 

1049
00:49:56,320 --> 00:49:58,560
Can the case be moved Change a 
venue? 

1050
00:49:58,600 --> 00:50:04,120
Yes, under 28 USC Section 1404 
A, even if venue is proper, a 

1051
00:50:04,120 --> 00:50:06,760
District Court may transfer the 
case to any other district where

1052
00:50:06,760 --> 00:50:09,040
it might have been brought, 
meaning PG and venue would be 

1053
00:50:09,040 --> 00:50:11,920
proper there too. 
For the convenience of parties 

1054
00:50:11,920 --> 00:50:15,240
and witnesses and in the 
interest of justice, courts 

1055
00:50:15,240 --> 00:50:18,000
weigh various public and private
interest factors. 

1056
00:50:18,000 --> 00:50:21,480
What if the more convenient 
forum is outside the US federal 

1057
00:50:21,480 --> 00:50:24,480
system, like in another country?
Then transfer isn't possible. 

1058
00:50:24,600 --> 00:50:27,400
Instead, the court might dismiss
the case under the common law 

1059
00:50:27,400 --> 00:50:29,600
doctrine of forum non 
convenience. 

1060
00:50:30,000 --> 00:50:32,800
This allows dismissal if there's
an adequate alternative form 

1061
00:50:32,800 --> 00:50:35,840
available elsewhere, and the 
balance of private and public 

1062
00:50:35,840 --> 00:50:39,240
interest factors strongly favors
dismissal, essentially finding 

1063
00:50:39,240 --> 00:50:41,600
that the current forum is 
seriously inconvenient. 

1064
00:50:41,840 --> 00:50:44,360
OK, then you sorted. 
Let's move into the actual start

1065
00:50:44,360 --> 00:50:46,680
of the lawsuit, pleadings and 
motions. 

1066
00:50:47,200 --> 00:50:49,240
It all begins with the 
plaintiffs complaint. 

1067
00:50:49,840 --> 00:50:53,120
What does Rule 8 require? 
The complaint kicks everything 

1068
00:50:53,120 --> 00:50:57,760
off under Rule 8A. 
It needs three things 1A Short 

1069
00:50:57,760 --> 00:51:00,600
and plain statement of the 
grounds for the court's subject 

1070
00:51:00,600 --> 00:51:04,440
matter jurisdiction, 2A Short 
and plain statement of the claim

1071
00:51:04,440 --> 00:51:07,800
showing that the pleader is 
entitled to relief and three, a 

1072
00:51:07,800 --> 00:51:11,640
demand for the relief sought. 
UB damages injunction. 

1073
00:51:12,120 --> 00:51:14,880
That short and plain statement 
of the claim is simple. 

1074
00:51:14,880 --> 00:51:17,200
Notice enough? 
What about those Trombley and 

1075
00:51:17,200 --> 00:51:19,520
Iqbal cases? 
That's a critical development. 

1076
00:51:19,640 --> 00:51:22,960
While Rule 8 technically 
requires only notice pleading, 

1077
00:51:23,200 --> 00:51:26,160
Twombley and Iqbal established a
higher plausibility standard. 

1078
00:51:26,160 --> 00:51:28,680
The complaint must contain a 
sufficient factual matter, 

1079
00:51:28,680 --> 00:51:31,400
except it is true to state a 
claim to relief that is 

1080
00:51:31,400 --> 00:51:34,400
plausible on its face. 
Mere conclusory statements or a 

1081
00:51:34,400 --> 00:51:37,280
recitation of the elements of 
the cause of action won't cut it

1082
00:51:37,280 --> 00:51:39,400
anymore. 
You need enough facts to nudge 

1083
00:51:39,400 --> 00:51:42,080
the claim across the line from 
conceivable to plausible. 

1084
00:51:42,200 --> 00:51:44,760
So more factual detail needed 
now than maybe before. 

1085
00:51:45,000 --> 00:51:47,880
Generally, yes. 
And remember, Rule 9B requires 

1086
00:51:47,880 --> 00:51:50,360
even more for claims of fraud or
mistake. 

1087
00:51:50,720 --> 00:51:53,480
Those must be pleaded with 
particularity detailing the 

1088
00:51:53,480 --> 00:51:55,600
circumstances constituting fraud
or mistake. 

1089
00:51:55,600 --> 00:51:56,600
The Who? 
What? 

1090
00:51:56,680 --> 00:51:58,000
When, Where? 
How? 

1091
00:51:58,000 --> 00:52:00,800
OK, then the defendant responds 
with an answer. 

1092
00:52:00,800 --> 00:52:02,720
What goes in there? 
The answer responds to the 

1093
00:52:02,720 --> 00:52:06,240
allegations in the complaint. 
Under Rule 8B, the defendant 

1094
00:52:06,240 --> 00:52:09,280
must admit, deny, or state that 
they lack sufficient knowledge 

1095
00:52:09,280 --> 00:52:12,080
or information to form a belief 
about the truth of each 

1096
00:52:12,080 --> 00:52:14,600
allegation. 
Importantly, the answer must 

1097
00:52:14,600 --> 00:52:17,520
also state any affirmative 
defenses under Rule 8C, things 

1098
00:52:17,520 --> 00:52:21,040
like statute of limitations, 
contributory negligence, statute

1099
00:52:21,040 --> 00:52:24,040
of frauds, rescue Ducata. 
What happens if you forget to 

1100
00:52:24,040 --> 00:52:26,640
plead an affirmative defense? 
You generally waive it. 

1101
00:52:26,640 --> 00:52:29,360
It's crucial to raise them in 
the answer or risk losing. 

1102
00:52:29,360 --> 00:52:31,880
Them before answering, can the 
defendant file motions to 

1103
00:52:31,880 --> 00:52:35,920
dismiss those Rule 12B motions? 
Yes, these are very important 

1104
00:52:35,920 --> 00:52:39,120
pre answer motions. 
Rule 12 B lists 7 defenses that 

1105
00:52:39,120 --> 00:52:42,120
can be raised by motion, 
including lack of SMJ, lack of 

1106
00:52:42,120 --> 00:52:46,120
PJ, improper venue, insufficient
process, insufficient service of

1107
00:52:46,120 --> 00:52:48,920
process, failure to state a 
claim, and failure to join a 

1108
00:52:48,920 --> 00:52:51,280
required party. 
Now, some of these are waived if

1109
00:52:51,280 --> 00:52:53,520
not raised early right the 
waiver trap. 

1110
00:52:53,720 --> 00:52:57,920
Big time defenses 12B2 through 
5, Lack of personal 

1111
00:52:57,920 --> 00:53:01,600
jurisdiction, improper venue, 
insufficient process and 

1112
00:53:01,600 --> 00:53:04,960
insufficient service of process 
Process are waived if they are 

1113
00:53:04,960 --> 00:53:08,640
not raised in the defendants 
first Rule 12 motion or if no 

1114
00:53:08,640 --> 00:53:12,200
motions filed in the answer. 
You lose them if you don't raise

1115
00:53:12,200 --> 00:53:13,920
them right away. 
Which ones aren't waived? 

1116
00:53:14,280 --> 00:53:17,720
Lack of subject matter 
jurisdiction 12B1 can never be 

1117
00:53:17,720 --> 00:53:19,440
waived and can be raised at any 
time. 

1118
00:53:19,880 --> 00:53:23,520
Failure to state a claim 12B6 
and failure to join a required 

1119
00:53:23,520 --> 00:53:26,720
party 12B7 can be raised later, 
even at trial. 

1120
00:53:26,960 --> 00:53:28,400
Good to keep those waiver rules 
straight. 

1121
00:53:28,760 --> 00:53:30,520
What about amendments to 
pleadings? 

1122
00:53:30,560 --> 00:53:32,800
Can parties change their 
complaint or answer later? 

1123
00:53:33,000 --> 00:53:35,160
Yes. 
Rule 15 governs amendments. 

1124
00:53:35,360 --> 00:53:37,920
A party can amend its pleading 
once as a matter of course, 

1125
00:53:37,920 --> 00:53:41,240
within 21 days after serving it,
or, if the pleading requires a 

1126
00:53:41,240 --> 00:53:44,480
response, within 21 days after 
the response is served or 21 

1127
00:53:44,480 --> 00:53:47,360
days after a Rule 12 motion is 
served, whichever is earlier. 

1128
00:53:47,400 --> 00:53:49,680
And after that? 
Otherwise, a party needs the 

1129
00:53:49,680 --> 00:53:52,680
opposing party's written consent
or the courts leave. 

1130
00:53:53,200 --> 00:53:56,800
Rule 15 A says leave should be 
freely given when justice so 

1131
00:53:56,800 --> 00:53:59,680
requires. 
Courts are generally liberal 

1132
00:53:59,680 --> 00:54:02,760
about allowing amendments unless
there's undue delay, bad faith, 

1133
00:54:02,840 --> 00:54:05,240
prejudice to the opponent or 
futility. 

1134
00:54:05,480 --> 00:54:07,600
What's this relation back 
doctrine? 

1135
00:54:07,600 --> 00:54:10,160
It sounds important for statute 
to limitations issues. 

1136
00:54:10,200 --> 00:54:14,400
It's critical relation back 
under Rule 15 C allows an 

1137
00:54:14,400 --> 00:54:17,400
amended pleading to be treated 
as though it were filed on the 

1138
00:54:17,400 --> 00:54:20,520
date of the original pleading. 
This usually applies if the 

1139
00:54:20,520 --> 00:54:23,800
claim or defense asserted in the
amended pleading arose out of 

1140
00:54:23,800 --> 00:54:26,800
the same conduct, transaction, 
or current set out in the 

1141
00:54:26,800 --> 00:54:29,280
original pleading. 
It can save a claim that would 

1142
00:54:29,280 --> 00:54:32,640
otherwise be time barred. 
OK, pleading set the stage. 

1143
00:54:32,960 --> 00:54:35,520
Then comes discovery, where the 
parties gather evidence. 

1144
00:54:35,800 --> 00:54:37,680
This seems like a huge part of 
litigation. 

1145
00:54:37,720 --> 00:54:41,800
It absolutely is, and heavily 
tested discovery allows parties 

1146
00:54:41,800 --> 00:54:44,880
to obtain information to build 
their cases, understand the 

1147
00:54:44,880 --> 00:54:47,640
opponent's case, and potentially
facilitate settlement. 

1148
00:54:47,880 --> 00:54:49,480
What's the basic scope of 
discovery? 

1149
00:54:49,480 --> 00:54:53,000
What can you ask for? 
Under Rule 26 B, one parties may

1150
00:54:53,000 --> 00:54:56,240
obtain discovery regarding any 
non privileged matter that is 

1151
00:54:56,240 --> 00:54:59,680
relevant to any party's claim or
defense and proportional to the 

1152
00:54:59,680 --> 00:55:02,440
needs of the case. 
Proportionality considers 

1153
00:55:02,440 --> 00:55:05,680
factors like the importance of 
the issues, the amount in 

1154
00:55:05,680 --> 00:55:08,760
controversy, the party's 
resources, the importance of the

1155
00:55:08,760 --> 00:55:11,920
discovery in resolving the 
issues, and whether the burden 

1156
00:55:11,920 --> 00:55:14,240
or expense outweighs its likely 
benefit. 

1157
00:55:14,280 --> 00:55:17,080
So it's broad but not unlimited.
Proportionality is key. 

1158
00:55:17,320 --> 00:55:20,840
Exactly, and certain things are 
automatically disclosed without 

1159
00:55:20,840 --> 00:55:25,160
waiting for a request under Rule
26 a required disclosures. 

1160
00:55:25,400 --> 00:55:27,280
What are those? 
There are three main types. 

1161
00:55:27,560 --> 00:55:30,600
Initial disclosures early in the
case require revealing names of 

1162
00:55:30,600 --> 00:55:33,120
potential witnesses, 
descriptions of relevant 

1163
00:55:33,120 --> 00:55:37,080
documents, ESI, computation of 
damages claimed, and insurance 

1164
00:55:37,080 --> 00:55:39,760
agreements. 
Later, expert disclosures 

1165
00:55:39,760 --> 00:55:42,560
require identifying testifying 
experts and providing their 

1166
00:55:42,560 --> 00:55:45,600
detailed reports. 
Finally, pretrial disclosures 

1167
00:55:45,600 --> 00:55:48,280
just before trial list the 
witnesses and exhibits expected 

1168
00:55:48,280 --> 00:55:50,680
to be presented. 
What are the main tools parties 

1169
00:55:50,680 --> 00:55:53,200
use to actively get information 
during discovery? 

1170
00:55:53,360 --> 00:55:57,600
The workhorses are depositions. 
Rule 30. 

1171
00:55:58,400 --> 00:56:00,320
Oral testimony. 
Underoath from parties or non 

1172
00:56:00,320 --> 00:56:03,000
parties, recorded 
stenographically or by video. 

1173
00:56:03,200 --> 00:56:05,600
Usually limited to 10 per side 
without court permission. 

1174
00:56:06,160 --> 00:56:07,920
Interrogatories. 
Rule 33. 

1175
00:56:08,400 --> 00:56:10,640
Written questions sent to 
another parter, answered in 

1176
00:56:10,640 --> 00:56:12,960
writing. 
Underoath usually limited to 25 

1177
00:56:12,960 --> 00:56:14,760
questions. 
Requests for production. 

1178
00:56:14,920 --> 00:56:17,240
Rule 34. 
Written requests asking another 

1179
00:56:17,240 --> 00:56:19,440
party to produce documents, 
electronically stored 

1180
00:56:19,440 --> 00:56:23,120
information, ESI, or tangible 
things for inspection or to 

1181
00:56:23,120 --> 00:56:25,520
permit entry onto land. 
Requests for admission. 

1182
00:56:25,560 --> 00:56:29,200
Rule 36 Written requests asking 
another party to admit the truth

1183
00:56:29,240 --> 00:56:31,800
of certain facts or the 
genuineness of documents, which 

1184
00:56:31,800 --> 00:56:34,600
helps narrow the issues for 
trial and physical or mental 

1185
00:56:34,600 --> 00:56:36,480
examinations. 
Rule 35. 

1186
00:56:37,000 --> 00:56:39,320
Only available by court order 
when a party's physical or 

1187
00:56:39,320 --> 00:56:42,480
mental condition is genuinely in
controversy and requires showing

1188
00:56:42,480 --> 00:56:44,640
good 'cause. 
What happens if a party refuses 

1189
00:56:44,640 --> 00:56:46,960
to cooperate or plays games 
during discovery? 

1190
00:56:47,040 --> 00:56:51,200
Rule 37 provides for sanctions. 
If a party fails to respond or 

1191
00:56:51,200 --> 00:56:54,520
provides evasive answers, the 
other party can file a motion to

1192
00:56:54,520 --> 00:56:57,280
compel. 
If they still don't comply, the 

1193
00:56:57,280 --> 00:57:00,200
court can impose sanctions 
ranging from paying other side's

1194
00:57:00,200 --> 00:57:02,920
expenses to preventing the 
disobedient party from 

1195
00:57:02,920 --> 00:57:06,560
presenting certain evidence, 
preclusion striking pleadings, 

1196
00:57:06,560 --> 00:57:09,680
dismissing the case, entering 
default judgment, or even 

1197
00:57:09,680 --> 00:57:13,000
holding them in contempt. 
Courts do not like discovery 

1198
00:57:13,000 --> 00:57:16,360
abuse. 
Failure to preserve ESI can also

1199
00:57:16,360 --> 00:57:19,440
lead to serious sanctions. 
OK, moving towards the end game,

1200
00:57:19,680 --> 00:57:23,920
cases don't always go to trial. 
What about pretrial resolution 

1201
00:57:24,240 --> 00:57:27,360
and summary judgment? 
Right parties can resolve cases 

1202
00:57:27,360 --> 00:57:30,040
themselves. 
A plaintiff can take a voluntary

1203
00:57:30,040 --> 00:57:33,560
dismissal under Rule 41 a 
usually once without prejudice, 

1204
00:57:33,560 --> 00:57:36,360
meaning they can refile later 
before the defendant answers or 

1205
00:57:36,360 --> 00:57:39,280
moves for summary judgment. 
After that, dismissal usually 

1206
00:57:39,280 --> 00:57:41,880
requires agreement or a court 
order and might be with 

1207
00:57:41,880 --> 00:57:43,520
prejudice. 
Barring refiling. 

1208
00:57:44,040 --> 00:57:46,760
A court can also order an 
involuntary dismissal, usually 

1209
00:57:46,760 --> 00:57:49,840
with prejudice, if the plaintiff
fails to prosecute the case or 

1210
00:57:49,840 --> 00:57:52,600
comply with rules or orders. 
What if the defendant just 

1211
00:57:52,680 --> 00:57:54,640
hosts? 
The lawsuit doesn't show up. 

1212
00:57:54,760 --> 00:57:56,480
That can lead to default 
judgement. 

1213
00:57:56,920 --> 00:57:59,760
First, the clerk makes an entry 
of default on the docket. 

1214
00:58:00,200 --> 00:58:03,000
Then the plaintiff applies for a
default judgement. 

1215
00:58:03,160 --> 00:58:05,840
If the claim is for a sum 
certain, the clerk can enter 

1216
00:58:05,840 --> 00:58:08,080
judgement. 
Otherwise, the judge enters it, 

1217
00:58:08,120 --> 00:58:10,560
possibly after a hearing, to 
determine damages. 

1218
00:58:11,080 --> 00:58:14,640
Defaults can sometimes be set 
aside later under Rule 55C or 

1219
00:58:14,640 --> 00:58:19,120
60B for good 'cause like mistake
or excusable neglect. 

1220
00:58:19,120 --> 00:58:22,120
And the big one for pretrial 
resolution summary judgment 

1221
00:58:22,120 --> 00:58:24,200
under Rule 56. 
When is this granted? 

1222
00:58:24,360 --> 00:58:27,200
Summary judgment is appropriate 
if the moving party shows that 

1223
00:58:27,200 --> 00:58:30,400
there is no genuine dispute as 
to any material fact and they 

1224
00:58:30,400 --> 00:58:32,320
are entitled to judgment as a 
matter of law. 

1225
00:58:32,680 --> 00:58:35,920
It essentially argues based on 
the undisputed facts, we win and

1226
00:58:35,920 --> 00:58:38,400
there's no need for a trial. 
How does that work with the 

1227
00:58:38,400 --> 00:58:40,400
burden? 
The moving party has the initial

1228
00:58:40,400 --> 00:58:44,160
burden to show the absence of a 
genuine factual dispute, either 

1229
00:58:44,160 --> 00:58:46,680
by pointing to flaws in the 
opponent's evidence or by 

1230
00:58:46,680 --> 00:58:50,200
presenting their own evidence. 
If they meet that burden, the 

1231
00:58:50,200 --> 00:58:53,120
burden shifts to the non moving 
party to come forward with 

1232
00:58:53,120 --> 00:58:56,640
specific evidence, affidavits, 
deposition testimony, etcetera, 

1233
00:58:56,880 --> 00:59:00,280
showing that there is a genuine 
dispute over a material fact 

1234
00:59:00,320 --> 00:59:03,920
that requires a trial. 
If we connect this to the bigger

1235
00:59:03,920 --> 00:59:07,520
picture, summary judgment is a 
vital tool for courts to dispose

1236
00:59:07,520 --> 00:59:10,440
of cases efficiently when a 
trial isn't necessary because 

1237
00:59:10,440 --> 00:59:12,480
the core facts aren't truly 
contested. 

1238
00:59:12,480 --> 00:59:14,640
OK. 
But if the case does go to 

1239
00:59:14,640 --> 00:59:18,400
trial, are there still ways to 
challenge the verdict or the 

1240
00:59:18,400 --> 00:59:21,240
sufficiency of the evidence 
during or after? 

1241
00:59:21,280 --> 00:59:23,840
Absolutely. 
During trial, after a party has 

1242
00:59:23,840 --> 00:59:26,960
presented all its evidence on an
issue, the opposing party can 

1243
00:59:26,960 --> 00:59:28,720
move for judgment as a matter of
law. 

1244
00:59:28,880 --> 00:59:33,600
JMOL under Rule 50A, this asks 
the judge to rule for the moving

1245
00:59:33,600 --> 00:59:36,120
party because the evidence 
presented by the opponent is 

1246
00:59:36,120 --> 00:59:38,920
legally insufficient for a 
reasonable jury to find in their

1247
00:59:38,920 --> 00:59:40,640
favor. 
And if the judge denies that and

1248
00:59:40,640 --> 00:59:43,880
the jury finds against you? 
Then after the jury verdict you 

1249
00:59:43,880 --> 00:59:48,640
can file a renewed JMOLO RJMLL 
under Rule 50B. 

1250
00:59:49,240 --> 00:59:52,600
You generally must have made the
initial JMO motion during trial 

1251
00:59:52,600 --> 00:59:56,480
to be eligible for RJML. 
It makes the same argument no 

1252
00:59:56,480 --> 00:59:58,960
reasonable jury could have 
reached this verdict based on 

1253
00:59:58,960 --> 01:00:02,160
the evidence. 
RJML must be filed within 28 

1254
01:00:02,160 --> 01:00:05,080
days after entry of judgment. 
What about asking for a whole 

1255
01:00:05,080 --> 01:00:07,480
new trial? 
That's a motion for new trial 

1256
01:00:07,480 --> 01:00:10,280
under Rule 59. 
It can be granted for various 

1257
01:00:10,280 --> 01:00:13,680
reasons, errors in the trial 
process like wrong jury 

1258
01:00:13,680 --> 01:00:16,840
instructions or admission of 
improper evidence, juror 

1259
01:00:16,840 --> 01:00:19,520
misconduct, newly discovered 
evidence that couldn't have been

1260
01:00:19,520 --> 01:00:22,000
found earlier with due 
diligence, or if the verdict is 

1261
01:00:22,000 --> 01:00:24,720
simply against the great weight 
of the evidence suggesting a 

1262
01:00:24,720 --> 01:00:28,520
serious miscarriage of justice. 
And one last one, motion to 

1263
01:00:28,520 --> 01:00:33,000
alter or amended judgment. 
Rule 59 E filed within 28 days 

1264
01:00:33,000 --> 01:00:34,480
of the judgment. 
This asked the court to 

1265
01:00:34,480 --> 01:00:36,920
reconsider and change its 
judgment based on things like 

1266
01:00:36,920 --> 01:00:40,320
manifest errors of law or fact 
or newly discovered evidence. 

1267
01:00:40,840 --> 01:00:43,440
These post trial motions are 
crucial for correcting errors at

1268
01:00:43,440 --> 01:00:46,120
the trial court level and 
preserving issues for appeal. 

1269
01:00:46,280 --> 01:00:50,160
Wow, that was a lot. 
We've really covered some ground

1270
01:00:50,160 --> 01:00:52,760
today on three massive bar exam 
subjects. 

1271
01:00:52,760 --> 01:00:54,600
We certainly have. 
We went deep into business 

1272
01:00:54,600 --> 01:00:57,200
associations, agency 
partnerships, corporations 

1273
01:00:57,200 --> 01:00:59,440
hitting formation liability 
duties. 

1274
01:00:59,840 --> 01:01:02,520
Then we really unpacked the 
critical differences between 

1275
01:01:02,520 --> 01:01:06,480
common law contracts and UCC 
sales that vibe check formation,

1276
01:01:06,480 --> 01:01:10,000
performance warranties, remedies
and finally navigated the 

1277
01:01:10,000 --> 01:01:13,440
procedural maze of Civil 
Procedure jurisdiction, venue 

1278
01:01:13,440 --> 01:01:15,800
cleatings, discovery, key 
emotions. 

1279
01:01:16,040 --> 01:01:17,800
Each one is a pillar for the 
bar. 

1280
01:01:18,040 --> 01:01:21,840
And your ability as you study to
confidently handle the details 

1281
01:01:21,840 --> 01:01:24,480
in each is just paramount. 
Absolutely. 

1282
01:01:24,480 --> 01:01:27,200
As you keep preparing, remember 
these areas don't exist in 

1283
01:01:27,200 --> 01:01:29,640
isolation. 
They intertwine constantly. 

1284
01:01:29,880 --> 01:01:31,120
That's often how they get 
tested. 

1285
01:01:31,120 --> 01:01:33,440
Complex hypotheticals that blend
these concepts. 

1286
01:01:33,440 --> 01:01:35,760
That's a great final thought. 
Think about how an agent's 

1287
01:01:35,760 --> 01:01:38,680
authority under agency law 
effects a contract governed by 

1288
01:01:38,680 --> 01:01:41,840
the UCC, which then leads to a 
jurisdictional fight under Civil

1289
01:01:41,840 --> 01:01:44,720
Procedure rules. 
Or how piercing the corporate 

1290
01:01:44,720 --> 01:01:47,440
veil and biz orgs might depend 
on facts uncovered through 

1291
01:01:47,440 --> 01:01:48,640
discovery. 
Right. 

1292
01:01:49,520 --> 01:01:53,040
The real world and the bar exam 
often weave these threads 

1293
01:01:53,040 --> 01:01:56,160
together. 
Understanding each thread helps 

1294
01:01:56,160 --> 01:01:58,360
you see that full tapestry of 
legal practice. 

1295
01:01:58,360 --> 01:02:00,080
Exactly. 
Keep thinking critically. 

1296
01:02:00,080 --> 01:02:02,280
Keep making those connections 
between subjects. 

1297
01:02:02,400 --> 01:02:05,080
It's not just about memorizing 
rules, but understanding how 

1298
01:02:05,080 --> 01:02:07,280
they function together to 
resolve disputes. 

1299
01:02:07,560 --> 01:02:10,320
Keep putting in the work, keep 
connecting those dots, and you 

1300
01:02:10,320 --> 01:02:13,000
will be well on your way to 
success on the exam and beyond.