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FINAL EXAMINATION IN ADMINISTRATIVE LAW (Law 323)

First Semester 1958-1959 Professor Cohn

Time — h Hours

1. (a) On January 15, 1956, the Federal Communications Commission publicly
announced that it was undertaking an extensive investigation into the practice of
local television stations of editoralizing and giving views on public and political
issues, and the extent of ownership interest in such stations by newspapers. It
suggested that such practices and ownership interests were to be investigated in
the light of their relationship to the FCC's statutory mandate to protect the pub-
lic interest in the use of these facilities by its licencees. The Commission is
authorized to investigate conditions and practices in the television industry, to
issue subpoenas and require reports of licensees, and "to adopt such regulations
and make such orders as are necessary to assure compliance with this Act and the
protection of the public interest."

Section 6 of the FCC Act provides that "any person adversely affected or
aggrieved by an order of the Commission granting or refusing an application for
a construction permit for a television station or for a television station license,
or for the renewal or modification of any such license," may secure review thereof
by petition for review filed in the Court of Appeals of the District of Columbia.
Section 7 provides that any person adversely affected or aggrieved by any order
of the Commission not reviewable under Section 6 may file suit to enjoin, set
aside, annul or suspend the order in any appropriate district court.

On February 1, 1956, six television station licgnsees, and six newspaper
corporations alleging ownership of all or a part of these television stations,
instituted an action under Section 7 for an injunction to enjoin the Commission
from proceeding with its investigation.

Discuss the issues and give decision. Assume that only the provisions of the
FCC Act are applicable.

(b) Assume no such action under (a). The Commission, without hearings, investi-
gates the practices and ownership aspects referred to in (a). On January 7, 1959,
it submits to Congress and the President a 2000-page documented report on the re-
sults of its investigation, concluding that the public interest requires it to
promulgate regulations imposing an absolute ban on editorializing practices, and
a policy requiring disapproval of applications for new licenses and denying re-
newal of existing licenses to any applicant or station whose controlling ownership
interest is a newspaper. On the same day, the FCC files such regulations for
publication in the Federal Register. The regulation pertaining to ownership
interests permits local stations to operate without prejudice until January 1, 1962,
in order to allow a reasonable time for the liquidation of unpermitted newspaper
ownership interests .

Oh April 1, 1959, six newspaper corporations owning the controlling interest
in six television stations, and the six stations, file suit unde-r Section 7 to set
aside and annul the regulations and to enjoin the Commission from enforcing theia.
Discuss and determine the issues (l) on the assumption that the Federal Adminis-
trative Procedure Act has not been enacted, and (2) in the light of the Federal
Administrative Procedure Act.

Final Examination in Lav 323.. First Semester 1958-59 Page 3-

(c) In a proceeding before the Federal Trade Commission charging a manufacturer
with false and deceptive advertising practices, the trial examiner made findings
of fact contrary to the charges in the complaint issued by the Commission. By
stipulation of the manufacturer and the Commission, the entire record consisted
of written exhibits and other documentary evidence. In addition to his findings
that the practices complained of were not in fact false or deceptive, the trial
examiner submitted conclusions that the statute could not be interpreted to cover
the particular advertising practices charged in the complaint. The Commission
rejected the examiner's findings of fact, conclusions, and recommended decision
that the complaint be dismissed, and entered its own findings and order that the
manufacturer was guilty of a violation of the Act. The District Court, in a re-
view proceeding, stated that "on the record considered as a whole, excluding the
examiner's findings and conclusions which we have not considered relevant, the
findings and order of the Commission are supported by substantial evidence and
are affirmed." The Court of Appeals affirms the District Court and the Supreme
Court grants certiorari.

3. The Walsh-Healy Act provides that any contract made with an agency of the United
States for manufacture^or furnishing materials, equipment, and supplies in excess
of $10,000 shall contain stipulations for the payment of minimum rates of pay and
overtime rates of compensation for overtime work. It provides further that a
violation of any of the stipulations shall render the offending party liable to
the United States in a sum equal to the amount of underpayment of wages due any
employee engaged in the performance of the contract; that sums due the United
States may be recovered in suits in the name of the United States by the Attorney
General; and that sums recovered in such suits shall be held in a special deposit
amount and shall be paid, on order of the Secretary of Labor, directly to the
employees who have been paid less than the rates to which they were entitled. The
statute empowers the Secretary of Labor to conduct hearings and make findings of
fact in respect to failure to pay less than minimum regular or overtime rates,
anc* expressly makes such findings conclusive in any court of the United States if
supported by a preponderance of the evidence.

Pursuant to this Act the United States instituted an action against General
Materials Corporation to recover damages for failure to pay overtime rates to
employees governed by a contract under the Walsh-Healy Act. The complaint alleged
that the Secretary of Labor had initiated an administrative proceeding against
the defendant which had been assigned to a hearing examiner; that after a hearing,
findings of fact would be made which would be conclusive if supported by a pre-
ponderance of the evidence, and that upon becoming final, such findings would be
filed in this cause together with a certified copy of the record made in tne ad-
ministrative proceeding. The complaint prayed that the court order a scay of
further proceedings in the cause until the completion of the administrative pro-
ceedingj the making of findings therein, and the filing in this cause of the
findings and a certified copy of the record, and that upon final hearing judgment
be rendered in favor of the United States for the sum due from defendant .

Defendant's motion to dismiss the complaint was granted and the government
appeals. Discuss the issues raised and give decision.

'

Final Examination in Law 323, First Semester 1938-59 Page 4.

h. A statute of the State of X regulated, coal mining and loewi miners. Among
other provisions it required that mine managers, defined as the persons in charge
of the general direction of underground work, be licensed. Examinations were pre-
scribed to test the qualifications of applicants for mine managers, including a
test of the applicant's ability to manage men, to operate mine machinery and
appliances, and to apply first-aid measures to injured persons.

The statute provided that the license of a mine manager could be revoked
without notice and hearing if the State Mining Board determined that "the holder
thereof has become unworthy to hold the license by reason of incapacity, abuse
of authority, or other good cause." Upon such action, the license holder could
request a hearing upon the charges. At the conclusion of the hearing, the Board
was authorized to "affirm, reverse or modify" its original order of revocation.
The statute further provided that in any hearing before it, the Board should not
be bound by technical rules of procedure or evidence. Judicial review by
certiorari was provided.

Jones successfully passed his examination and was issued a license as a
mine manager. Thereafter he was employed in that capacity by the Perfection Coal
Company. Three years after such employment began, without hearing, the Board re-
voked lis license, the notice of revocation stating: "Effective immediately, your
license as mine manager is revoked on grounds that you are addicted to the use of
alcoholic liquor to an extent which renders you incapable of performing your duties
properly, and on the further ground that you have owned and operated a gambling
enterprise in violation of state law. You are entitled to a hearing before the
State Mining Board if request therefor is made within 30 days from the date of
this order. You are not to engage in employment as a mine manager and your
employer, Perfection Coal Company, and all other coal operators in this State have
been notified of the revocation of your license, effective immediately."

(a) Jones files an injunction action to enjoin the Board from enforcing its order,
alleging the statute and the Board's action to be unconstitutional. Discuss the
issues and render decision.

(b) Instead of filing an injunction suit, Jones requests a hearing before the
Board. At the hearing, Jackson, assistant mine manager at Perfection, testifies
that on three separate days he detected an alcoholic odor on Jones ' breath during
working hours. Two other employees testify to the same effect. None of these
witnesses can testify that he observed Jones in the act of taking an alcoholic
drink on the job, but Jackson testifies, over objection, that he had interrogated
most of the miners, and that two miners who refused to have their names divulged
told him that they had actually observed Jones drinking liquor on the job on two
occasions within the month immediately preceding the revocation of his license .
Jones, on direct and cross-examination, denied that he had ever taken a drink
while on the job although admitting that he did drink occasionally and in moderation
after working hours. Over Jones' objection, the Board placed in evidence the
written report of its employee -investigator Adams, who had since resigned and
moved to parts unknown, to the effect that Jones was a nightly customer at the
local pub, the Green Light, and that on three specifically designated nights in the
month immediately preceding the revocation of Jones' license, Jones had imbibed
liquor in such quantities as to require assistance in getting to his home, and

that on two of those occasions Jones had "passed out completely." Jones denied
the truth of these charges.

■

Final Examination in Law 322 .> First Semester 1958-59 Page 5-

The Eoard offered in evidence a certified copy of the record of conviction of
Jones for the illegal ownership and operation of a gambling enterprise, for which
he had been fined $100 after a plea of guilty. Jones objected to the introduction
of this evidence but did not deny or contest the matters covered therein.

One week after the conclusion of the hearing, the Board entered an order in
the following terms : "The State Mining Board hereby affirms its order revoking the
license of Sam Jones. Me find as the facts upon which this order is based that

1. Jones is excessively addicted to the use of alcoholic liquor, and

2. Jones has been convicted of a criminal offense, namely, the ownership
and operation of a gambling enterprise."

Jones seeks review of the order by certiorari as authorized by the statute.

Discuss and analyze the issues, giving decision.

5. Answer each of the following questions T (true) or F (false) in the examination
booklet :

1. The federal Administrative Procedure Act, except as to agencies exempt
from its application, compels notice, hearing, and record requirements for
all agency action which is adjudicative in nature.

2. Agency interpretation of statutory terms is usually a question of law on
judicial review calling for independent judicial interpretation, though
exceptions justifying limited judicial rule are occasionally recognized.

3- Written notice of all agency charges is constitutionally requisite where-
ever agency adjudicative action embraces charges not specified in the
initial notice.

k. Certiorari is generally not appropriate as a review remedy where agency
action is not based upon a hearing and record requirement.

5- The "required records" doctrine does not prevent a claim of the 5"th Amend-
ment privilege where disclosure of the records will incriminate a person
in a penal offense.

6. The exercise of the rule-making function may constitutionally be exercised
without the trial type proceedings customary in agency adjudication.

7- Every exercise of agency authority must be referable to a constitutional
or statutory grant of power.

8. The federal substantial evidence rule does not permit the sustainment of
agency findings of fact when the heavy preponderance of evidence is con-
trary to the findings.

9. A state's immunity from suit does not foreclose actions against state offi-
cers or agencies allegedly acting in violation of the constitution.

10. The "final order" rule generally does not preclude judicial review of
interlocutory or preliminary agency orders.

FINAL EXAMINATION IN ADMINISTRATIVE LAW (Law 323)
First Semester 1959-1960 Professor Cohn

TIME: h HOURS

Note: You are not to assume that the statutory provisions referred to in

the problems relating to federal agencies are necessarily correct in
all respects.

1. Section 10 of a state Unemployment Compensation Act reads in part as follows:

"An individual who has left his most recent work voluntarily without
good cause shall not be eligible for benefits with respect to the week
in which such leaving occurred and with respect to not less than four
nor more than nine consecutive weeks of unemployment which immediately
follow such week, as determined by the Board in such case according to
the seriousness of the case. In addition such individual's total
benefit amount may be reduced in a sum equal to the number of weeks of
disqualification multiplied by the weekly benefit amount."

Section 20 provides that

"application by employees for benefits and by employers for a determination
of their status and liability under this Act shall be heard by the Board,
with notice to all affected persons to be given by registered mail."

That section then continues as follows :

"At the conclusion of the hearing, the Board shall render its
decision which shall be accompanied by findings of fact upon which the
decision is based. Any person affected by any order or decision of the
Board may seek a review thereof in the circuit court of the county
in which the employee resides or the employer has his principal place
of business, on all questions of law and fact presented by the record,
by petition for review filed in accordance with the requirements of the
state procedure act . At the request of any party to the proceeding,
the court, in lieu of reviewing the record, shall hold a trial de
novo in which full and complete opportunity to present evidence bearing
on all issues of law and fact shall be afforded the parties. The findings
of fact of the Board, if supported by substantial evidence, shall be
conclusive and final. In any proceeding before the Board, it shall
not be bound by technical or formal rules of evidence or procedure.'

The Board causes notice to be published in newspapers of general circulation
throughout the state that on a given date, place, and time it will hold a public
hearing "to hear the views of interested persons concerning the meaning of the
terms 'voluntarily' and 'good cause' in Section 10 as these terms affect the
eligibility of individuals for unemployment compensation benefits, as an aid to
the Board in interpreting and applying Section 10." At the hearing which is
well attended by numerous employees, employers, and representatives of labor
unions and employer organizations, the Chairman of the State Board announces
that the Board will hear all statements desired to be made and receive any
written statements, exhibits, or reports submitted, but that no examination or
cross-examination of any person will be permitted. Numerous objections to this
procedure are voiced, which the Chairman announces "will be noted in the record.
A stenographer employee of the Board is present for the purpose of "entering
and transcribing a full report of all evidence received at the hearing."

Final Examination in Law 323., First Semester 1959-60 Page 2

A month after the end of the hearings, the Board announced and published a
"general order' defining "voluntarily" and "good cause" as these terms were em-
ployed in Section 10. A portion of this order stated as f ollovs :

"It shall not be deemed 'good cause' for an employee to leave
the employment of an employer who lawfully maintains an open shop
policy of employment, notwithstanding that continuation in such
employment would jeopardize the employee's union status, including
seniority rights and insurance and other union benefits."

In an accompanying statement of explanation, the Board revef-lcc ti-at it had
considered the evidence taken at the public hearing but that it ,-ras primarily
influenced in reaching this decision as a result of its own inver.-ige.tion of
the administrative interpretation of the same statutory terms in every state in
the Union and the heavy preponderance in such states favoring the interpretation
adopted, of which it said it 'took notice."

(a) Adams, a union employee of the X Manufacturing Company which legally
maintains an open shop policy, and Local No. 278, an affiliate of the International
Garment Workers Union, with which Adams is not affiliated, file separate injunction
and declaratory judgment actions which seek to declare the order invalid and to
enjoin its application by the State Board. Adams alleges that if he continues

his employment with the X Manufacturing Company, he will be in violation of his
union rules and will lose his membership, including seniority status, his in-
surance, and other union benefits. The actions are consolidated and the Board
moves to dismiss the complaints. Analyze and discuss all relevant issues, giving
decision.

(b) In lieu of the judicial proceedings under (a), Adams prefers to leave
his employment in order not to jeopardize his union status . After the appropriate
waiting period, he files a claim for benefits and the matter is set down for a
hearing. The X Manufacturing Company properly enters the hearing as a protestant
against the allowance of benefits . To establish eligibility, Adams must show that
he has been available for employment of a similar character and that he has
actively and reasonably sought suitable employment. To establish these facts,
Adams testifies that since leaving the employment of the X Manufacturing Company,
he sought comparable work with seven other companies in the area but that in each
instance there were no positions open or if there were, the employers maintained
an open shop policy. Over the X Company's objection, the Board permitted Adams

to introduce letters signed by the personnel directors of five such companies con-
firming the fact that Adams had sought employment. Three letters stated that no
positions were open. Two stated that positions were open but that Adams had
declined to accept employment. Nothing was said in these latter two letters
about the reasons for refusal. After the hearing was concluded, an investigator
of the Board called upon these latter two companies and the two companies from
whom no letters had been received by Adams, and in each instance was told that
the company maintained an open shop policy. .This information was transmitted tc
the Board.

The Board entered an order granting benefits exclusive of the f '.rst week of
unemployment and the nine additional weeks immediately following. Ix also reduced
the total benefit amount under the formula of Section 10 by $185.

Page 2

Final Examination ia Law 323, First Semester 1959-60 Page 3

Adams and the X Manufacturing Company both seek reviews under Section 20. In
addition the X Manufacturing Company requests the court to conduct a de novo
hearing.

Discuss and analyze the relevant issues offered by both Adams and the X
Manufacturing Company, and give decision as to each.

2. In each of the following problems, state in less than 20 words the principal
legal issue, and in less than 100 words, your decision and the reasons therefor.

(a) The Interstate Commerce Commission, pursuant to its powers of investiga-
tion, seeks to ascertain whether the Red Star Motor Service Corporation, certi-
ficated as an intrastate carrier under Illinois law, is engaging in the interstate
transportation of property for which a certificate under the Interstate Commerce
Act is required. It issues a subpoena directed to the president of the corporation,
directing him to submit "all records pertaining to its transportation of property
in commerce.'1 The subpoena is ignored and the Commission, pursuant to law, files
action in the district court seeking an order compelling compliance with the
subpoena. The company files an answer stating it is engaged exclusively in intra-
state commerce. It offers to prove, over the Commission's objection, that such

is the case. The court permits proof, including the testimony of the five mem-
bers of the Illinois Commerce Commission, to the effect that it has made an ex-
tensive investigation of the Corporation's total operations and has concluded,
as of the week prior to this judicial hearing, that the Corporation is engaged
exclusively in intrastate commerce. The District Court thereupon dismisses the
Commission's action, holding that the Corporation is engaging solely in intrastate
commerce. The Commission appeals to the Court of Appeals.

(b) A state statute authorizes the summary seizure and destruction of
cigarettes which are fraudulently stamped or which contain neither valid state

or federal stamps, and the summary seizure and sale of cigarette vending machines
which contain such cigarettes, the proceeds of the sale to revert to the state.
Pursuant to this authority, the state commission, acting upon a warrant, seizes
a cigarette vending machine in the X Tavern. Adams, owner of the tavern and
licensed by state law to sell cigarettes, files an injunction suit .■ a gains tithe
Commission and prays for a return of such cigarettes as are properly stamped and
for return of the vending machine.

(c) A state statute regulating and licensing the sale of alcoholic liquor
provides that the regulatory board, upon petition of any interested citizen, may
investigate charges that a licensee is violating the law, and, if upon the basis
of the investigation determines that grounds exist for the revocation of the
license, to institute a proceeding for that purpose. A petition is filed and the
Board investigates, in the course of which it holds a hearing at which considerable
evidence is received pro and con on the issue of violation. Upon the conclusion

of the hearing, the Board filed a "decision" which included a recital of the
charge and a resume of the evidence, and concluded: "No action to be taken on
these allegations. Continue usual investigative procedure." The person who had
filed the petition instituted a mandamus action to compel the Board to institute
a proceeding to revoke the license of the person investigating, alleging that
the record of the hearing contained overwhelming evidence to establish the
violations. The Board moved to dismiss the action.

Page 3

Final Examination in Lav 323> First Semester 1959-60 Page k

3- Part I of the Interstate Commerce Act relates to rail carriers. Part III deals
with water carriers . Part II regulates motor carriers of persons or property for
hire. The Interstate Commerce Commission is authorized to regulate the rates of
all three classes of carriers. As to rail and water carriers, the Commission is
expressly authorized to entertain reparation proceedings in behalf of shippers
who contend that the established rate is unreasonable. Shippers under Parts I
and III may also seek to recover excessive charges in a federal district court
under the Tucker Act, but in such cases the issue of unreasonableness of the rate
is referred to the Commission for its decision. Part II contains no comparable
authorization for reparation suits before the Commission or in the courts, but the
Commission on its own motion or on the complaint of shippers may investigate and
determine the reasonableness of the existing rates on file, and it may suspend
for a period of seven months a new schedule of rates filed by a carrier pending
its determination of reasonableness and may refuse to approve rates so determined
to be unreasonable. Section 2l6 of Part II provides that "Nothing in this part
shall be held to extinguish any remedy or right of action not inconsistent
herewith."

Reference to legislative history discloses that on three separate occasions,
19^9> 1952, and 195^, the Commission sought amendments to Part II which would have
given shippers the same remedies as in Parts I and III, but on each occasion the
House Committee, to which the bills were reported, recommended against passage.

On February 1, 1956, the Commission, without notice or hearing to any regulated
carriers, filed in the Federal Register a general rule to the effect that effective
April 1, 1956, it would hear and consider reparation claims filed by shippers under
Part II. In its statement of reasons, the Commission declared that it was acting
under its delegated authority to determine the reasonableness of rates, and that
such rule was necessary to equalize the status of all shippers under Parts I, II,
and III, and to prevent discrimination adverse to shippers under Part 11$. The
Interstate Commerce Act provides for judicial review of final decisions affecting
any person or carrier aggrieved by agency action.

(a) On April 10, 1956, 25 interstate certificated motor carriers file a
combined action for declaratory judgment and injunction to declare the rule in-
valid and unenforceable. The district court overrules the Commission's motion to
dismiss and on the merits holds the rule invalid. The Supreme Court grants
certiorari .

Discuss the issues and give decision.

(b) Assume no action under (a). On September 1, 1956, a shipper institutes
a reparation action before the Commission under Part II. The carrier objects to
the jurisdiction of the Commission and challenges the validity of the rule. The
Commission holds its rule to be valid and proceeds with the hearing. The Commission
finds the rate charged to have been unreasonable though in conformity with the
carrier :s tariffs on file with it. The shipper then institutes action in the
district court on the reparation order against the carrier, who moves to dismiss
the complaint. The District Court dismisses the complaint and the Circuit Court

of Appeals affirms this judgment. The Supreme Court grants certiorari. Give
decision with special emphasis upon policy and legal issues other than the
statutory power of the Commission to adopt the rule in question.

Page h

Final Examination in Law 323, First Semester 1959-60 Page 5

h. The Civil Aeronautics Act sets up a comprehensive scheme for the regulation of
common carriers by air. Many statutory provisions apply without regard to whether
the carrier is a foreign air carrier or a citizen air carrier, and whether the
carriage involved is "interstate air commerce," "overseas air commerce," or
"foreign air commerce," each being appropriately defined. All air carriers by
similar procedures must obtain from the Civil Aeronautics Board (CAB) certificates
of convenience and necessity by showing a public interest in the establishment
of the route and the applicant's ability to serve it. However, when a foreign
air carrier (defined as a "person not a citizen engaged in foreign air trans-
portation") applies for a certificate, or a citizen carrier applies for a certifi-
cate to engage in any overseas or foreign air transportation, a copy of the appli-
cation must be submitted to the President of the United States before hearing by
the CAB; and any decision by the CAB, either to grant or deny, must be submitted
to the President and is unconditionally subject to his approval or disapproval.
In exercise of this power the President may, in addition, make modifications or
alterations in the rights, privileges or conditions contained in the CAB's decision.
The statute subjects to judicial review

"any order, affirmative or negative, issued by the Board under this Act,
except any order in respect of any citizen or foreign air carrier subject
to the approval of the President."

United Air Lines and TWA were rival applicants for certificates to engage in
foreign air service to London, Paris, and Rome. Both carriers are citizen air
carriers. The CAB heard the applications jointly (assume this may properly be
done). Shortly after the termination of the hearings, the CAB advised the United
Air Lines that it was recommending to the President the approval of TWA's ap-
plication and the disapproval of United 's application.

(a) United seeks judicial review, alleging that the findings in both ap-
plications are unsupported by substantial evidence, and that CAB had engaged in
serious procedural errors which impaired the fairness of the hearing. TWA is per-
mitted to intervene and by its pleadings supports the decision of the CAB. The
Board moves to dismiss the petition for review, which the Court of Appeals denies.
On the merits, the Court then finds the allegations of United relative to the
Board's findings to be correct and remands the case to the CAB. The Supreme Court
grants certiorari. Give decisions and reasons.

(b) Assume no action as under (a). The President modified the CAB decision
re TWA by eliminating the authority to service Rome. He advised the Board of
the changes he desired made. The Board complied and submitted a revised order

and opinion which the President approved. With regard to the Presidential changes,
the Board's decision stated "because of certain factors relating to our national
welfare and security arrangements with foreign countries for which the Chief
Executive has special responsibility, he has reached conclusions which require
the changes noted in the Board's opinion." There was no disclosure by the Presi-
dent as to why he had made the modifications. United Air Lines now files its
petition for review in form and substance as in (a). Same action by the Court
of Appeals as in (a), and the Supreme Court grants certiorari. Give decision and
reasons. Discuss in terms of pre- and post -Administrative Procedure Act.

Page 5

Final Examination in Law 323, First Semester 1959-60 Page 6

5- Answer each of the following questions T (true) or F (false) in the examina-
tion booklet.

1. Under the Illinois Administrative Review Act. uniform procedures respecting
the adjudicatory process are applicable to all administrative agencies where the
act creating or conferring power upon the agency adopts the provisions of the
Review Act by express reference.

2. The Federal Administrative Procedure Act provides that a hearing and the
notice and other procedural requirements of that Act shall apply to all adjudicatory
proceedings of agencies unless the APA exempts the agency or the particular pro-
ceeding from its applicability.

3- In federal proceedings, the doctrine of exhaustion of administrative
remedies will generally not be applied where the sole issues in controversy
embody questions of law.

k. The federal substantial evidence rule permits a reviewing court to affirm
administrative findings of fact, notwithstanding that the niihtf wntwl. preponderance
of evidence in the whole record is contrary to such findings.

5. Where certiorari is an appropriate review remedy, its scope extends to a
review of questions of law and fact.

6. The immunity of the State of Illinois from suit is a matter of legislative
grace .

7. Constitutional due process requires judicial review of all agency action
affecting persons or property.

8. Legislative authorization expressly delegating power to administrative
agencies to define conduct in violation of the act as penal and to define and
prescribe the penalties for such conduct is generally held valid.

9. Notice and trial type hearing in adjudicatory action of an agency may be
dispensed with by the legislature whenever it declares that the public interest
and welfare so requires.

10. The doctrine or rule of necessity prevents disqualification of an agency
even though personal bias and hostility of a generally disqualifying character
exist-; .

Page 6

FINAL EXAMINATION IN ADMIRALTY (Law 3I+3)
Summer Session 1959 Professor Davis

TIME ALLOWED: THREE HOURS

Instructions: The casebook for this course (Morrison & Stumberg, "Cases
and Materials on Admiralty" ) may be used freely during the
examination. No other materials are authorized.

1. Shipper delivered a quantity of baled cotton, worth $50,000, on board the
steamer Aquamarine at Mobile, Alabama, for carriage to Providence, Rhode Island.
The Aquamarine and the tug Stonewall Jackson, worth $200,000 and $10,000 respec-
tively, were owned by the Atlantic & Gulf Steamship Company. Other cargo loaded
aboard for the Mobile-to-Providence voyage was worth $150,000. Shipper received
a bill of lading signed by the master of the Aquamarine acknowledging receipt of
the cotton for transportation to Providence and containing the so-called "Jason"
clause. While the ship was navigating out of Mobile Harbor, assisted by the
Stonewall Jackson, she ran hard aground in consequence of the concurrent negligence
of the masters of both vessels. To get the Aquamarine off, the Atlantic & Gulf
Steamship Company was obliged to unload and reload a considerable part of the
cargo, including all of Shipper' s cotton. In the process a part of the cotton got
wet. The Atlantic & Gulf Steamship Company spent $3,000 in drying Shipper's
cotton, and $12,000 in lightening, floating, and reloading the cargo. On arrival
at Providence, the Atlantic & Gulf Steamship Company refuses to deliver the cotton
unless Shipper pays $5,000 in addition to the agreed freight. Shipper consults
you. Advise him concerning his rights and any practical action that he may take.

2. During a storm on the high seas the tanker Petroil broke in half, leaving the
master and nine men on the forward, and thirty-nine officers and men on the after
part. The armed merchant vessel American Sportsman responded to a wireless SOS
from the forward part of the Petroil, came alongside, took off the master and men,
and sank the forward half of the Petroil by gunfire. After a search of several
hours, the American Sportsman found the after part of the Petroil and, at the re-
quest of the latter' s master, put bim and his nine men aboard what was left of the
Petroil. The American Sportsman then passed a line and proceeded to tow the
Petroil stern-first, with the aid of the Petroil' s own engines, into port. This
voyage lasted ten days, covered 900 miles, was interrupted by six breaks in the
tow-hawser, and required great exertion and hardship on the part of everyone con-
cerned. Encountering fog fifteen miles off her proposed port of refuge, the
American Sportsman cast off the Petroil with the intention of finding a buoy and
then returning to take up her tow. During her absence the Petroil, navigated by
her own crew stern-first and in violation of the fog rules, collided with and
sank the ship Coney Island. The Coney Island had just cleared the port for which
the Petroil was headed, and the former had not given whistle blasts as required
by the fog rules. The whistle was inoperable because of dirt-clogging.

The owners of the Coney Island now libel the Petroil for damages. The Ameri-
can Sportsman libels the Petroil and her cargo for salvage. The master and crew
of the Petroil libel her and her cargo for salvage. The crew of the Petroil libel
her for wages. The Coney Island was worth $100,000 before sinking. There is
$5,000 in wages due the Petroil' s crew. The after half of the Petroil is sold by
agreement for $90,000, which is paid into court. The cargo of the Petroil is
sold by agreement for $25,000, which is paid into court. No freight is due.

Write the opinion of the court distributing the funds in hand.

Final Examination in Admiralty (Law 3^3), Summer Session 1959 Page 2

3. On the evening of December 5> 1958, the motor vessel Tungus docked at Bayonne,
New Jersey, with a cargo of coconut oil in her deeptanks. El Dorado Oil Works
had been engaged by the consignee to handle the discharge of this cargo, and for
the next several hours the work of pumping the oil ashore was carried on by El
Dorado employees, using a pump and hoses furnished by their employer. Two officers
and two seamen of the Tungus remained aboard in overall control of the vessel and
to assist in the discharge operations. Shortly after midnight the pump became
defective, resulting in the spillage of a large quantity of oil over the adjacent
deck area. The pump was stopped and the oil cleaned from its immediate vicinity.
Efforts to restore the pump to normal operation were unsuccessful, and Carl
Skovgaard, an El Dorado maintenance foreman, was summoned from his home to assist
in the repair work. After arriving on board he walked through an area from which
the spilled oil had not been removed. In attempting to step from a hatch beam
to the top of the partly uncovered port deeptank, he slipped and fell to his death
in eight feet of hot coconut oil.

Your firm has been retained by Skovgaard' s widow, and your senior partner
requests a memorandum concerning the widow's legal rights and remedies, if any.
See The Tungus v. Skovgaard, 79 Sup. Ct. 503 (Feb. 1959).

h. Plaintiffs, having sold and agreed to deliver certain goods to a Spanish com-
pany, arranged for their ocean carriage on the S.S. Ampudia from Ealtimore, Mary-
land, to Valencia, Spain. The goods, consisting of 52 cases, were transported
from Detroit by flatcar to a point on the Baltimore pier alongside the Ampudia
and were there taken in charge by the vessel's agent for loading and shipment.
A bill of lading was signed by the agent and delivered to plaintiffs. The value
of the goods was not declared by plaintiffs or inserted in the bill. Defendant,
an independent stevedoring company, was orally engaged by the ship' s agent to
load the cargo. While moving one of plaintiff's cases, containing a press weigh-
ing 19 tons, across the deck of the ship, defendant's employees negligently
caused it to fall into the harbor. The resulting and provable damage is $W3,0C0.

Plaintiffs now sue defendant in admiralty for the full amount of the damage.
What decision? Cf. Herd & Co. v. Krawill Machinery Corp., 79 Sup. Ct. 766
(April 1959).

5- Passenger disembarked at New York at the end of his voyage aboard the
passenger liner Lorelei. While waiting for customs inspection, he walked along
the pier to watch the unloading of cargo and wandered into a roped-off area
plainly marked "KEEP OUT." While there he was injured as a result of the neg-
ligent loading of a cargo sling. The causal act of negligence was that of a
longshoreman employed by the Lorelei and occurred on shipboard.

Passenger now brings a libel in personam against the owners of the Lorelei
to reoover for his personal injuries. What decision?

End of Examination

•

.

FINAL EXAMINATION IN BANKRUPTCY (Law $kk)
Second Semester 1959-1960 Professor Looper

Instructions : Total time on this examination is two
(2) hours. There are four questions. It is suggested
that you allocate about kO minutes each to Questions 1
and 2, and about 20 minutes each to Questions 3 and k.

1. (a) B was adjudicated a bankrupt at the age of fifty. On the filing of the
petition , B had the following:

1. An endowment insurance policy payable to him at the age of sixty,
and if he should die before that time, payable to his wife.

2. A remainder in Blackacre. That estate had been devised to
X for life, remainder to the children of Y who should be living at X's
death. B is one of several living children of Y. X is still living.

3. A right of action for wrongful discharge from a contract of
employment .

k. A right of action for damages for deceit.

(b) After the filing of the petition, but before adjudication, B, while in the
exercise of due care, was injured and his automobile damaged in a collision with C,
who was negligent.

What are the rights of B's trustee in bankruptcy in the above?

2. An involuntary petition in bankruptcy was filed against B on December 31,
1959j and B was duly adjudicated a bankrupt on May 1, i960. During the year
1959 "the following events transpired:

1. In early January B became unable to pay his debts as they matured.
Up to January 15, however, his assets continued to exceed his liabilities

by about $5,000. On January 15 B deeded a piece of rental property worth
$7,000 to his wife. This transaction produced an excess of liabilities
over assets of $2,000. B's balance sheet position did not improve during
the rest of the year.

2. On July 15 B selected among his creditors his old friend Neff and
paid him his $10,000 claim in full. At the time Neff knew that B was
insolvent.

3- On September 5 Garage acquired a mechanic's lien on B's car.

k. On September 30 B went to Mitchell to whom he owed a debt of
$30,000, which was secured by a first mortgage on property then worth $25,000.
Under threat of foreclosure, B paid Mitchell $10,000 on account.

5. On December 30 Neff loaned $50,000 to B, taking as security an
assignment of $100,000 of accounts receivable. At the time Neff knew B
was hopelessly insolvent.

You are called upon by the trustee in bankruptcy to advise as to which
of the above transactions can be successfully attacked and how.

,

Final Examination in Bankruptcy (Lav/ 3M+) Second Semester 1959-60 Page 2

3. A state law provides that when any domestic business corporation is insolvent
in the sense of inability to pay debts as they mature, or is guilty of certain
scheduled offenses, or being a non-moneyed corporation has less assets than lia-
bilities, on petition of the Attorney General or of any creditor having a claim of
$100 or more, a receiver shall be appointed, who shall wind up the corporation.
Against such an involuntary petition, it is moved to dismiss on the ground that
the state law is suspended by the Federal Bankruptcy Act. What decision?

k. The following questions are short-answer items. Full credit will be given
for unexplained categorical answers under all items but (d) and (e). You may, if
you have doubts, explain others.

(a) Which acts of bankruptcy are entirely independent of in-
solvency?

(b) Which acts of bankruptcy require insolvency "in the
bankruptcy sense"?

(c) Which acts of bankruptcy involve insolvency defined other-
wise than as defined in Section 1 of the Bankruptcy Act?

(d) Give an example of a transaction defeasible in bankruptcy
that is not an act of bankruptcy.

(e) Give an example of an act of bankruptcy that is not a
voidable transaction.

(f) What are the requirements of a petitioning creditor?

(g) What persons are amenable to involuntary bankruptcy?

NO.

FINAL EXAMINATION IN BILLS AND NOTES (Lav 321)
Second Semester 1958-1959 Professor Warren

IMPORTANT: Do not write your name on either the question sheet or the examina-
tion booklet. A sheet will be passed around, listing each member of
the class. Please write your examination number in the space after
your name .

DIRECTIONS: You will have 3 l/2 hours for this examination. You are restricted
to two pages for the first question and one page for each of the
other six questions. Nothing beyond this page limitation will be
graded. Please write plainly. Answer these questions on the basis of
the Uniform Negotiable Instruments Law and the general American case
law interpreting this act.

1. (2 pages) The following statute is §3-304 of the Uniform Commercial Cede:
Section 3-304. Notice to Purchaser.

(1) The purchaser has notice of a claim or defense if the instrument
is so incomplete, bears such visible evidence of forgery or
alteration, or is otherwise so irregular as to call into question
its validity, terms or ownership or to create an ambiguity as to
the party to pay.

(2) The purchaser nus notice of a claim against the instrument when
he has knowledge that a fiduciary has negotiated the instrument
in payment of or as security for his own debt or in anv trans-
action for his own benefit or otherwise in breach of duty.

(3) The purchaser has notice that an instrument is overdue if he has
reason to know

(a) that any part of the principal amount is overdue or that
there is an uncured default in payment of another instru-
ment of the same series; or

(b) that acceleration of the instrument has been made; or

(c) that he is taking a demand instrument after denand has been
made or more than a reasonable length of time after its
issue. A reasonable time for a check drawn and payable
within the states and territories of the United ."rctes and
the District of Columbia is presumed to be thirty days.

(U) Knowledge of the following facts dees not of itself give the
purchaser notice of a defense or claim

(a ) that the instrument is antedated or postdated;

(b) that it was issued or negotiated in return for an executory
promise or accompanied by a separate agreement, unless the
purchaser has notice that a defense or claim has arisen
from the terms thereof;

(c) that any party has signed for accommodation;

(d) that an incomplete instrument has teen completed, unless
the purchaser has notice of any improper ccmple~ion;

(e) that any person negotiating the instrument is or was a
fiduciary;

(f) that there has been default in payment of interest on the
instrument or in payment of any other instrument, except
one of the same series.

Comment briefly on how the enactment of this section would affect the existing lav
of negotiable instruments in states where the UNIL is still in effect. In your
answer point out in what respects §3-304 would change the existing law and in what
respects it merely restates it.

'

■

Final Examination in Law 321, Second Semester 1958-1959 Page 2

2. (l page) Discuss briefly the effect on negotiability that each of the following

clauses alone would have on an otherwise negotiable instrument:

(a) "We promise to pay to bearer $100, one year after date. Value
to be received in store rent for store Wo. W+3 Camp Street, as per lease of this
date."

(b) "It is understood that the signer of this instrument is not per-
sonally liable and that this instrument is payable solely out of trust funds.

(Signed) John D. Davis, Trustee
Davis Investment Trust"

(c) "In lieu of the payment of the aforementioned sum of money, the
holder of this instrument may have the option to accept the maker's race horse,
Nadir, in discharge of this obligation."

3. (1 page) M made a promissory note on January 1, 1958, to P, payable six months

after date, in payment of the price of machinery to be used by M in his
factory. P refused to accept the note and advance the goods until M
was able to prevail upon his rich uncle, A, to sign his name at the top of the back
of the instrument. After A signed the note, P discounted it with B Bank on January
15. M was unable to pay the note upon maturity and, after due presentment and notice
of dishonor, A paid the note. A now sues M on the note which was surrendered to A
when he paid B. Can A recover? Explain.

The following section of the UHIL is relevant:

Section 121. Where the instrument is paid by a party secondarily
liable thereon, it is not discharged; but the party so paying it is re-
mitted to his former rights as regards all prior parties and he may strike
out his own and all subsequent indorsements and again negotiate the in-
strument, except:

(1) Where it is payable to the order of a third person, and has been
paid by the drawer; and

(2) Where it was made or accepted for accommodation, (and) has been
paid by the party accommodated.

k. (1 page) Mary was payee of a negotiable promissory note made to her order for
value by Michael. Her cousin Harriet fraudulently induced Mary to
indorse the note in blank and deliver it to her in payment for some
securities which Harriet well knew were worthless. This delivery took place one
week after the note became due. Harriet indorsed the note in blank and quickly sold
it to Harold, who paid value without actual notice of any defenses of any nature to
the note. When Mary learned of the fraud, she sued to recover the note from Harold.
What result? Why?

5. (l page) M, 20 years of age, made a negotiable note to "P or bearer" for $100,
on January 1, 1958, in payment of a new power lawn mower. The note was due on May
21, 1958. P handed the note to A on January 10, without indorsing it. A indorsed
the note "without recourse," signed his name below, and delivered it to B on February
15. Ten days later B indorsed the note "Pay to C," signed his name below, and de-
livered it to C. On March 1, C wrote across the back of the note, "I assign this
note to D," signed his name below, and delivered it to D, a purchaser for value
without notice.

(a) Assume that upon maturity there was proper presentment and notice of dis-
honor. What are the rights of D against M, P, A, B, and C? Explain.

(b) Assume there was no presentment. What are the rights of D against M, P,
A, B, and C? Explain.

! '

'

■

:

Final Examination in Law 321, Second Semester 1958-1959 Page 3

6. (l page) A fraudulently induced M to purchase a worthless power mower and took
from M in payment a promissory note for $100, regular and negotiable in form but for
the fact that the instrument was blank as to the payee's name. A had specifically
requested that M leave the payee's name blank. A's reason for this request was that
he wanted to avoid any liability on the instrument; however, he did not tell M the
reason for his request. A sold the instrument still blank as to the payee's name

to B for value, before maturity. B had no notice of any defenses en the instrument.
B sold the instrument to C, who also took for value, without notice, and before
maturity.

(a) Suppose at the time of the sale of the note to C, B, in the presence of
C, filled in A's name as payee. What are C's rights against M, A, and
B? Assume due presentment and notice of dishonor.

(b) How would your result in (a) change if B had filled in his own name
instead of A's?

(c) How would your result in (a) change if B had filled in C's name instead
of A' s?

7. (l page) P forged David's name as drawer of a check drawn on Drawee Bank for

$100 payable to order of P. P indorsed the check in blank and de-
livered it to X, who thereupon deposited it in B Bank. B stamped on
the back of the check, "Pay any Bank, Banker, or Trust Company, All Prior Indorse-
ments Guaranteed, (signed) B Bank," and sent the instrument to the Drawee Bank for
payment. Payment was received in due time. You may assume that neither Drawee nor
B Bank knew of the forgery until the depositor later discovered it.

(a) Suppose Drawee sued B to recover the amount paid out on the forged check
on the theory that B by indorsing the instrument warranted its validity.
Should Drawee recover on this ground? Explain.

(b) Suppose X knew of the forgery when he took the check. If this fact could
be proved, could Drawee recover from B Bank if the latter had paid out
(1) the full amount of the check to X? (2) none of the check to X?
Explain.

'

FINAL EXAMINATION IN BILLS AND NOTES (Law 321 )
Second Semester 1959-1960 Professor Whiteside

MAXIMUM TIME: 3 l/2 HOURS

1- (Suggested time: 40 minutes) The following check was drawn by John Doe and
delivered to Daniel Dealer:

Champaign, Illinois, September 1, 1959

SECOND NATIONAL BANK

FAY TO THE ORDER OF Daniel Dealer $ 600.00

Six hundred and no/lOOths dollars

John Dee

Dealer's salesman and branch manager Barker had no authority to cash Dealer's checks,
but nevertheless he picked it up, forged Daniel Dealer's indorsement, received the
cash frcm the Mudville Bank, which sent the check for collection to Federal Bank
(Chicago), which collected from the Second National Eank and remitted to the Mudville
Bank. Indorsements by the Mudville Eank and the Federal Bank were in the usual
form, "Pay any bank, banker, or trust company, prior indorsements guaranteed."

What are the rights between the following parties:

a) Second National Eank and Mudville Bank?

b) Second National Bank and Federal Eank?

c) Second National Bank and John Doe?

d) Daniel Dealer and Second National Bank?

e) Daniel Dealer and Mudville Bank?

f ) Daniel Dealer and Federal Eank?

If you think there are additional facts or factors (unmentioned but consistent
with the above statement of facts) which might affect the rights of the parties,
please note them in your discussion.

2. (Suggested time: 30 minutes) M, as consideration for an illegal gambling debt,
wrote his 30-day negotiable note to P, the operator of a large gambling establishment
in nor-thern Illinois, in the sum of $1000. P indorsed the note in consideration of
restaurant equipment sold by X to P. X, on the day of maturity of the note, sold
it to Y for value but failed to indorse to Y. Neither X nor Y had actual notice of
the nature of the transaction relating to the issuance of the note by M to P.

a) Can Y recover from M? Would your answer be different if the note were
executed and payable outside of Illinois?

b) Suppose instead of taking without indorsement, Y had received delivery of
the note and X's indorsement before maturity. Y gave value and had no
notice at the time of negotiation of the transaction out of which the
original issuance of the note arose. In a state where gambling is con-
sidered only a personal defense, does M have a defense against Y if X
defrauded P? If you can not. answer definitely, upon what additional
factors might your answer depend?

c) Suppose that M when asked to pay has actual notice of a claim by P that

Final Examination for Bills and Notes (Lav; 321), Second Semester 19?S -19°0 Page 2

X procured P's negotiation of the note by means of material and fradu-
lent misrepresentations. Is a payment by M to X or Y good? What should
M do?

3. (Suggested time: 30 minutes) Matthews, service station owner, bought his oil
and gas from Penny, a wholesale distributor. While out of town for a week, Matthews
left his trusted employee, Abscon, in charge of his business and left with Abscon a
negotiable promissory note in the sum of $100 signed by Matthews and payable to the
order of Penny, dated April 2, i960, and payable thirty days frcm date. Abscon was
supposed to deliver the note to Penny on account of the week's supply of oil and gas,
which came to a few dollars more than $100. Abscon skillfully raised the note to
$200, and then took the note to Penny and stated that Matthews wished to borrow $200
for his trip and would catch up on his account for oil and gas delivered upon his
return to town the next week. Penny, who had known Abscon and the fact of his employ-
ment by Matthews for several years, and had done business with Matthews for many year?
gave Abscon the $200 against the note. Abscon promptly left town, never to return.
On May 10, i960, Penny indorsed the note to Holden for $190. Holden took the note
in good faith and without any suspicion that there might be anything wrong with it.
On May 11 Holden presented the note to Matthews, who refused payment. Discuss the
rights of Holden against Matthews .

k. (Suggested time: Uo minutes) On June 12, 1956, Dr. W. Willson executed the
following instrument:

June 12, 1956

On or before twelve months from date I promise to pay to the
order of Illinois Elevator Company the sum of twenty-five
hundred dollars with b'p interest until paid.

This note is in payment of 25 shares of capital stock in
Illinois Elevator Company.

This note shall become due and payable on demand at the
option of the payee when it deems itself insecure .

This note is secured by a mortgage of even date, and for a
description of the mortgaged property and the nature and extent
of the security, reference is made to the mortgage, to all of the
provisions of which this note is subject.

In the event of default of this note, I authorize any
attorney of record in Illinois to appear for me and confess judg-
ment for the said sum, together with costs of collection.

(Signed) V.T. Willson

To procure the note frcm Willson, the Treasurer of the Illinois Elevator
Company, whose name was Ellis, represented that $100,000 in capital stock had already
been paid up and that the company was already in operation. In fact nothing had
been contributed to the stock of the company, and it had never done any business,
although it was incorporated.

One month after the above note was delivered to Ellis for the corporation, Ellis

Final Examination in Bills and Notes (law 321), Second Semester 1959-19^0 Page 3

as the officer authorized to sign the name of the corporation indorsed for the
corporation to the First National Bank, and received from the First National Bank
a credit for $2500 to Ellis's personal account in that Bank. Ellis shortly with-
drew the full amount.

Two months later the First National Bank demanded payment from Dr. Willson, who
refused because he had discovered the fraud by Ellis. Then the First National Bank
brought suit on the note against Willson, introduced the note, ana rested. Dr.
Willson introduced adequate proof of the fraudulent representations by Ellis. Does
the First National Bank have a chance to recover, and if so, what must it establish?

SHORT ANSWER QUESTIONS

5. (Suggested time: 25 minutes) Answer the following questions in your examination
book in 50 words or less.

a) Why have banks used the indorsement form, "prior indorsements guaran-
teed"?

b) Why have some banks been reluctant to certify a check at the request
of the holder?

c) Why have some banks been reluctant to certify a check at the request
of the drawer?

d) Why is it not strictly accurate to state that the statute of limit-
ations runs against the drawer of a check frcm the date of the
instrument because it is payable on demand?

e) Sections 87 and 137 of the NIL were completely omitted in the Illinois
version. Section 87 deals with instruments payable at a bank; Section
137 deals with drawee's acceptance by destruction or refusing to re-
turn a bill presented for acceptance. Why in your opinion did Illinois
omit these two sections?

6. (Sugggested time: ho minutes) A. Explain the changes, if any, which the
Uniform Commercial Code would make in the following NIL provisions (as printed in
your pamphlet entitled "Laws of Illinois Relating to Negotiable Instruments").
Limit your answer to 50 words or less for each subdivision.

a)

Section 9, Subsec.

3

b)

Section k, Subsec.

3

c)

Section 10

a)

Section 15

e)

Section 71

f)

Section 188 (g)

g)

Section 9, Subsec .

5

B. Which of the above Illinois sections or subsections change the unamended Uniform
Negotiable Instruments Law to be found in the majority of states, and what are the
changes? Limit your answer to 50 words or less for each subdivision.

FINAL EXAMINATION IN BUSINESS ASSOCIATIONS (Law 320 )
First Semester 1958-1959 Professor Frarcpton

This is a three-hour examination. There are four (4) questions of equal weight.
Where a question is divided into two or more parts, the weight given to tha+
question is divided equally among the parts . Allocate not more than 45 minutes to
a question.

Begin the answer tc each question on a new page. Place your examination book
number, with a circle around it, at the beginning of each answer tr each question,
and place the question number after it. Example: A student assigned cook number
66 would begin the answer to question 3:

(66) 3-

Do not write anything on the cover page of the examination book except the infor-
mation called for in the boxed blanks at the top of the cover page. Write legibly
in blue or black ink. Urite on both sides of the pages.

No credit is given for length. Since credit will be giver, for conciseness and
organization as well as for seeing and discussing the legal problems suggested by
the facts, it follows that unnecessary length will affect your mark adversely.

Do not turn this page or begin the examination until instructed to do so.

When you have finished the examination, or when time is called, whichever is sooner,
turn the cover page of the book back so that the name does not show, and hand the

book in with the beginning cf the answer to question jfl face up. You may keep or

discard the examination questions.

Fi^al Examination in Law 320, First Semester 1956-1959 Page 2.

1. Paul Pratt, doing business under the name of I'll-Truck-4-U Leasing Company,
owned a fleet of trucks which he normally leased with drivers for heavy construc-
tion work. Since little construction work is done Saturdays, Pratt occasionally
allowed a driver to supplement his five-day-week wages by taking a truck to earn
side-money. Pratt required only that the driver have the truck in by 6 p.m., pay
for his own gas, and pay Pratt two cents a mile, to cover non-gas costs of oper-
ating the truck, plus 2$ of his gross receipts. One Saturday morning Al Awn, a
driver, took a Pratt truck pursuant to the above understanding and solicited
trucking to the county fair. The truck was conspicuously marked T-^-U. At Tom
Todd's farm Awn took on a load of sensationally large and choice turnips -- Todd's
entire supply of that strain -- for which Todd had every reason to expect to win

a $500 gold prize. Todd asked for security for the safe transportation of the
turnips, whereupon Awn wrote the following note to Todd: "Upon failure to deliver
your turnips safely at the county fair on today's date, we promise to pay you
$250. (signed) I'11-Truck-U-U Co., by Al Awn, Authorized Driver." Awn thereupon
set off at an exhilarating speed, careened across a narrow bridge, striking and
injuring Timothy Tad, who was fishing from it, and catapulting the truck into the
river, to his own serious injury and the complete loss of the truck and turnfps.
Pratt asks you what are his probable rights and liabilities arising out of this
situation. Advise him.

2. Uncertainty resulting from recent court decisions has led Senator Ale, of your
state, to introduce the following bill in the legislature (S.B. l):

"Every member of any association not incorporated shall be subject +0
liability for the contracts executed or torts committed by any agent
thereof as though the association were regarded and treated as a
corporation. "

Senator Car has introduced a bill (S.B. 2) similar in all respect to S.B. 1 except
that the language after the word "thereof" in S.B. 2 reads "as though the associ-
ation were a partnership as defined in the Uniform Partnership Act." These bills
have been referred to the Committee on Business Legislation, of whdeh you are
counsel. The committee members include some lawyers and some non-xa^yers . Pre-
pare a brief memorandum for their use :

(a) Explaining how each bill would affect existing law, if at all; and

(b) Civing your opinion of the bill and its possible effects, with reasons;
and if you do not favor one of the two bills in its present form, suggest-
ing what changes in either bill could avoid some or all cf the problems
you believe might be created by enactment in its present form.

3- Ab Awk, intending to act for Pat Par, whom he had not previously represented,
approached Ted Tull, without Par's knowledge, about purcnasing a carload of top
grade de luxe widgets on 10 days' credit terms. Tull said, "For whom?", and Awk,
fearful that Tull would jack up the price if he knew that Par, a well-known million-
naire, was "in the picture," shrugged and said, "Ueli, for someone, of coarse, out
what difference does it make?" Tull also shrugged and they then entered into a
contract for the purchase of the widgets for $5,000, Awk signing it, "Ab Awk."
Wh^n Par learned that Awk had intended to act for him and realized that the widgets
would sell easily for $7500, he supplied Awk with $5,000 to perform the contract.

Final Examination in Law 320, First Semester, 1959-1959 • Page 3-

Assume, (l), that Tull discovered, on the day before the performance date
under the contract, that he could easily get $7500 for the widgets. Tull suggested
to Awk that Awk should in good conscience reduce his potential profit. Avk by this
time was temporarily short of cash and had even responded to his hard-pressing
personal creditors with Par's $5000. He told Tull that he had intended to act for
Par, although without Par's knowledge, and suggested that any further discussions
might have to be held with Par. Tull, outraged, told Awk he would not perform an
unconscionable transaction in which he had been "defrauded," as he put it, about
the identity of "che other party. Tull asks you whether he has any liability to
Par. Advise him, giving tne basis for your advice.

Assume, (2), that the bottom dropped out of the widget market on the day
before the performance date under the contract. Awk then told Tull the widgets
were for Par. Tull said, "Good, that means I'm sure to get my money despite recent
developments. I'll deliver, and look only, to Par. Ycu give no further thought
to the matter." It was then that Awk used Par's $5000 to satisfy Awk's personal
creditors . Par denies ever having had any dealings with Tull and states that he
does not trust him or the quality of his widgets, and that he would never have
agreed to such short credit terms. He states alternatively that he has already
paid for the carload. Advise Tull as to all his rights.

k. Ben Bar made available to Amos Arc, an inventor, $10,000 with which to niake a
prototype Whirlitoy Rocket that could be launched easily and safely and could be
directed in flight. The model would embody and disclose the basi~ idea which, when
made practicable, could be later covered by patent rignts in the name of the owner.
It was understood that if the rocket were practicable, Arc and Bar would share
50-50 the proceeds from its sale by either one. Arc employed Carl Cott to launch
the rocket, which he did successfully at high noon, except that it landed on Dan
Down's farmhouse, damaging the roof. Arc telephoned Bar within the hour to tell
him of the success. Arc forgot to mention the details of the landing or that the
Hot Toy Company had indicated an interest in paying $20,000 for Whirlitoy if it got
off the groiind. Arc asked Bar if he would care to sell out his half to Arc for
$7500, and Bar agreed to do so. The necessary papers were signed 'chat afternoon
at 3 p.m. That evening at 7 p.m. Arc made a sale of Whirlitoy to Hot, delivered
the model, and received payment. Meanwhile, late that afternoon, Bar heard of
Hot's interest and also the interest of Coldspot Electrical Toys, Inc. In anger
at Arc for moving so fast, Bar sold Whirlitoy to Coldspot at 5 p.m. for $21,000,
received their check for that amount, and promised delivery of the model the
next day. Discuss and evalue briefly all the probable rights of Arc, Ear, Cold-
spot, Down, and Hot, indicating in each case against whom these rights cculd be
asserted.

FINAL EXAMINATION IN BUSINESS ASSOCIATIONS (Law 320)
Summer Session 1959 Professor Frampton

This is a three-hour examination. There are four (k) questions of equal weight.
Where a question is divided into two or more parts, the weight given to that ques-
tion is divided equally among the parts. Allocate not more than 4 5 minutes to a
question.

Begin the answer to each question on a new page. Place your examination book
number, with a circle around it, at the beginning of each answer to each question,
and place the question number after it. Example: A student assigned book number

33 would begin the answer to Question 3: /*33) 3-

Do not write anything on the cover page of the examination book except the infor-
mation called for in the boxed blanks at the top of the cover page. Write
legibly in blue or black ink. Write on both sides of the pages.

No credit is given for length. Since credit will be given for conciseness and
organization as well as for seeing and discussing the legal problems suggested by
the facts, it follows that unnecessary length will affect your mark adversely.

Do not turn this page or begin the examination until instructed to do so.

When you have finished the examination, or when time is called, whichever is
sooner, place the examination paper in the back of your answer book, turn the
e^ver pa&e of the book back so that the name does not show, and hand the book in
with the beginning of the answer to Question #1 face up.

Final Examination in Business Associations, Law 320, Summer Session 1959 Page 2

1. Paul Prim purchased a large house on August 1. Not wishing to be identified
with renting rooms, he engaged Al Able to manage and operate for him a boarding
house, to be called "The Requie-Inn," in consideration of free rent for a suite
for Able. Prim instructed Able not to mention Prim's name, to rent rooms for not
less than $60 a month, and to do whatever was necessary to keep the house running
and in good repair. On September 1 Able rented two rooms, one to Tom Tad and one
to Tim Trent, for nine months at $U0 a month per room. The rental arrangements
were evidenced by two identical memoranda: "The undersigned agree to rent a room
at the Requie-Inn for nine months from September 15 for $40 a month." Tad and
Trent each signed his respective memorandum individually and Able signed both
memoranda, "Al Able for the Requie-Inn." On September 2 Tad said to Trent, "I've
found a better place and since I learned today that Able wasn't supposed to rent

to us for $Uo anyway, I'm withdrawing from the Requie-Inn arrangement." On Septem-
ber 3 Able truthfully told Prim he feared he could not get more than $1+0 and had
rented the two rooms accordingly. Prim said, "In view of how you view rental con-
ditions, I guess maybe that will be all right." On September 5 Prim learned he
could rent the rooms for $65 a month each and disavowed the rentals as unauthorized.
Both tenants wish to occupy. What are all the rights and liabilities of all the
parties?

2. Sam Stall saw an opportunity to make a profit in the prompt trucking and re-
sale of a bumper crop of melons in Honeyloup County. He borrowed $1,000 from Ben
Bagg, a wealthy landowner, on the understanding that Bagg would be repaid by
receiving one-third of the profits after deducting all costs, and that Stall and
Bagg would agree on the volume of melons to be trucked, principal routes, and re-
sale prices. Stall engaged Art Apt, a Honeyloup farmer who then had some extra
time, and Apt's truck, for a fee to be based on time and mileage. The truck was
marked, "The Apt Farms." Stall gave Apt $500 with vrtiich to buy melons for cash
and told him where to buy them and where to sell them. Apt bought $500 worth of
melons on credit from Tobias Trott and others, trucked them to a city 200 miles
away, and sold them for $750 to buyers designated by Stall. On the way back Apt
and his wife, who was with him, saw a sign pointing to "The Melon Man - 3 Miles,"
and detoured off the main road to investigate the Melon Man's melons, prices, and
credit terms. On that detour Apt's wife, who was driving because of Apt's ex-
haustion, negligently struck and killed Homer Hap.

(1) The executor of Hap has brought an action for wrongful death against
Bagg. As judge in that action, write an opinion disposing of the one or more
issues, if any, that you would not submit to the jury, and charge the jury on the
one or more issues, if any, that you would submit to it.

(2) Trott has brought an action against Stall for the sale price of melons
delivered to Apt. Advise Stall as to his probable liability in this action, as
to any concern or interest he should have in the action of Hap v. Bagg, and as
to any rights he may have against anyone arising out of these actions.

3. Ambrose Awk and Bert Boar, Jr., are partners in the firm of Bert Boar and
Son, which is engaged in the custom tailoring of clothes. Awk' s participation in
the financing and management of the business is not generally known. On August 1
Bert, with partnership funds, purchased ten bolts of fine linen for $1,000 and
sold and delivered them to Tubb, Inc., linen factors, in satisfaction of a personal
obligation which he owed them. Talbot Tisk, a new Tubb buyer, examined the bolts
at the time of delivery and before Bert was released from his obligation, and

he noticed a defect in the linen which had occurred during recent handling, but

-

'

Final Examination in Business Associations, Law 320, Summer Session 1959 Page 3

he did not mention it to his superiors. Had he described the defect to them, they
would have known that the linen was worthless, a condition not brought home to
them until an action was brought against Tubb, Inc., on August 15 by a purchaser
from it. On August 10 Awk, while checking into firm matters, discovered the linen
transaction and the fact that Bert was insolvent, and he promptly dissolved the
partnership. The president of Tubb, Inc., asks you what his company's rights and
liabilities are.

h. Bye-Syk, Inc., is a corporation duly incorporated to make and sell bicycles
and motorcycles. Saul Syk is the principal shareholder, president, and one of
five directors. The by-laws provide that the president "may borrow money and do
all other acts necessary to carry on the usual and normal business of the corpora-
tion, and may exercise any authority that can be delegated to him by the board of
directors," and the directors by resolution have authorized Syk to sign company
checks. On June 1 Syk borrowed $10,000 from Toby True on a 30-day note to True
as payee. The note was signed, "Saul Syk, President, for Bye-Syk, Inc." The
money was used to make a down payment on a 100-acre summer campsite near a lake.
When the note became due, Bye-Syk, Inc., was in sufficient funds to enable Syk to
pay part of the note by a check for $2,500 on the corporation and to get an ex-
tension of thirty days on the remaining $7,500. Two days later, at the annual
shareholders' meeting, the shareholders adopted a resolution which provided that
they "expressly ratify and confirm all directors' acts made or taken since our
last meeting." On default of payment, outline and evalue the principal points
in the briefs of all the parties in an action by True for $7,50° with interest
against Syk and Bye-Syk, Inc.

FINAL EXAMINATION IN BUSINESS ASSOCIATIONS (Law 320)
First Semester 1959-60 Professor Stephens

Time Limit: 3 hours

This three -hour examination consists of five questions, all of equal weight
for grading purposes. You vrt.ll have a little more than half an hour for each
question, but do not let this encourage you to write unduly long answers; no
credit will be given for mere length, and an answer that is long because of
poor analysis or faulty organization will be graded down. Try to deal concisely
with all the issues genuinely present in each question.

1. Phil Potts, as a sole proprietor, operated a vholesale egg distribution
business, purchasing fresh eggs from scattered farmers; candling, cleaning and
boxing them; and delivering them to retailers at a fluctuating price. I /hen his
business had grown some, he engaged Al Apt to help in the purchasing end of the
business. Al's job was to purchase for Phil betveen 80 and 100 cases of eggs
per week at the best price available; he was to pay cash for the purchases

and Phil set up a limited checking account for Al to facilitate his purchases .
Al was furnished a panel truck decorated with a sign "Potts Perfect Eggs" for
use in his purchasing work, but it was agreed that Al would continue in his
position as assistant manager of the local bowling alley, fitting his purchasing
activities into time left free by his other duties. On one purchasing excursion
Al found that farmer Taft was willing to enter into an agreement to sell Potts
ten cases of eggs each week at $U.OO per case, slightly above the going rate,
if an agreement at that price could be made for a period of six months . Taft
misunderstood Al's hesitation to sign an agreement, and told ^him there was
five cents a case in it for Al himself if he would make the deal. Al accepted
and signed an agreement with Taft for Potts, executing the agreement, "Phil
Potts by Al Apt, agent." \lhen Al showed Potts the agreement, Potts said: "That's
great; suppliers are scarce, and this will ax least assure us of ten cases
a week." In the following week the price of eggs dropped drastically. More-
over, Al, on his round of egg collections, was killed in a head-on collision
with Terry Tutt when Al's excessive speed prevented his panel truck from taking
a curve. Farmer Taft is asserting his rights under the egg contract, and Al
Apt's widow and Terry Tutt are threatening Potts with suits for death and injuries
in the collision. Advise Potts concerning his rights and obligations.

2. A speculative builder constructed three small adjoining stores on a
lot in a good business district. Pat Pants purchased one store and opened up
a men's clothing business, at first selling only suits, coats, and similar
apparel. The other stores were purchased by Ted Tall and Tom Teek, who,
respectively, established a men's furnishings and a dry cleaning establishment.
Only Pants was successful, and he expanded his operation to include merchandise
competitive with Tall and a connection with another local cleaner that put

him in competition with Teek. As the need of Pants for more space grew, the
ill will between him and his neighbors grew even faster. Pants wanted the other
stores but feared being held up on price by the other owners. Therefore he
telephoned Arty Ants, a licensed real estate broker, and later gave him written
authorization to purchase the properties for him. In negotiations between
Ants and Tall, Tall asked, ungrammatically: "Who are you acting for?" Ants
replied: "Someone, but what's the difference?" Toll did not press the point
further. Teek, on the other hand, said: "Are you buying for that scoundrel
Pants?" In a flash Ants thought he saw a big chance; he would buy both prop-
erties on his own and then undertake to hold up Fants himself. Accordingly,
he answered: "No." Ants executed a contract in writing with both Tall and Teek

Final Examination in Law 320, First Semester 1959-196C rage 2

for the purchase of each piece of property at $15,000. Now, learning of space in a
new building to be constructed across the street, Pants has lost interest in both
deals, and Ants has indicated to both Tall and Teek that he will not go through with
either deal. But Tall and Teek, having learned that Ants was supposed to buy for
Pants and that Pants would like to wriggle out, would now like to hold Pants liable.
At a minimum they would like to sell for $15,000 because the new building will make
it hard to get that price from anyone else. Discuss the rights of both Tall and
Teek against both Ants and Pants, assuming that neither Tall nor Teek has as yet
commenced any judicial proceedings.

3- On the same general facts as these in Question No. 2, assume that Tall
brought a damage action against Ants for breach of contract, and somewhat later Teek
did the same, in both instances without either plaintiff s knowing of the relation-
ships between Ants and Pants. Tall got a judgment against Ants, which has not been
satisfied, and the Teek suit is still pending. Now for the first time Tall and Teek
learn that Fants was involved in the deal. Discuss the rights of Tall and Teek
against Pants.

U. Vic Putter worked as a machinist for Widgets, Inc., a conventional widget
manufacturer. In the course of his work and largely by making good use of slack
periods in the plant, he invented a revolutionary new widget that threatens to drive
conventional widgets off the market. Putter has secured the patent although Widgets,
Inc., has been manufacturing the new widget ever since it learned of Putter's in-
vention. Putter's friend Vernon Ace offered to help him exploit the new invention.
After much discussion they agreed that it would be desirable to sell the patent to a
conventional widget manufacturer and that a fair price would be $125,000, of which
Putter said he would pay Ace twenty percent. Widgets, Inc., has steadily refused
t<"i buy the patent and has gone right on using it. However, Ace has finally made an
oral agreement with Special Widgets, Ltd., who have agreed to buy the patent for
$125,000. Putter refuses to go through with the deal at this price, placing a
higher value on the patent than that originally agreed to between him and Ace be-
cause of remarkable sales successes of Widgets, Inc. Discuss the rights and obli-
gations between Widgets, Inc., and Putter ; Special Widgets, Ltd., and Putter; and
Putter and Ace.

5- Of two brothers, Really Able and Notso Able, Really was a financial suc-
cess and Notso was always in financial difficulty. Notso Able and John Baker were
partners in the firm of Baker and Sons, which operated a small grocery store, but
Notso Abie's connection with the business was generally unknown. Charles Charlie, a
supplier of Baker and Sons, somewhat uneasy about the firm' s account, approached
Baker one day with a new gleam in his eye and said: "I've just heard that Really
Able is your partner." "That's right, Able is my partner," was Baker's reply. In
support of his reply Baker showed Charlie a bill for goods purchased, addressed to
"Able and Baker, "and a check made out to Baker by Really Able for $200, which had
been received in payment of goods but which Baker said was given him to discharge
certain small debts of the firm. Just at that moment Really Able walked into the
store to buy a package of cigarettes. "How's business?" he asked Baker. "We'll do
a little better this month," was the reply. Charlie said to Really, "You're a foxy
one, Really, as an accountant, to be interested in businesses in this town." Really
Able made no reply and left. At about the same time Notso Able had taken the firm
truck out of town to try to purchase vegetables for the store at nearby farms.
Picking up a farmer's daughter en route, he let his mind wander and the truck wan-
dered into the ditch, killing Notso and slightly injuring the passenger. Seme time
later, Really Able, as administrator of Notso' s estate, consented to Baker's con-
tinuation of the business. Although Charlie has not been paid for past credit
transactions, he has extended additional credit to Baker. Consider the relative
rights and obligations of Really, Baker, Charlie, and the farmer's daughter.

FINAL EXAMINATION IN BUSINESS ASSOCIATIONS (Lav 320)
Summer Session i960 Professor Stephens

TIME LIMIT: 3 Hours

This examination consists of three questions, each of which has
several parts. As to each question the relative point value for grading
purposes is indicated. It will be necessary for you to make seme assump-
tions beyond those stated in the questions; state clearly what you are
assuming.

It should not be necessary to write long answers to these questions
if you have given them sufficient thought before you begin to write.
Therefore you are encouraged to be brief, but not at the expense of ex-
plaining fully your conclusions.

I. (Uo points) P owned and operated all by himself a small automobile service
station. A drove a gasoline truck, making deliveries for the D
Company which supplied P with gasoline. On Friday, July 1, A was
delivering gasoline to P, a job with which, according to their custom, P had nothing
to do. Having started the flow of gasoline from truck to tank, A had gone into the
service station office to smoke a cigarette; P was in the pit doing a grease job.
As it later developed, A had carelessly attached the hose to the truck so that a
trickle of gas was running down the hose and making a small pool near one of the
gas pumps. About this time T drove in to buy some gas. P yelled from the grease
pit: "Hey, A, how about putting some gas in that car for me?" Carefully ex-
tinguishing his cigarette, A went out to comply with P* s request. As A walked up,
T, who was smoking as he drove in, got out of his car and dropped his cigarette
on the pavement with the intention of putting it out. However, it lit on the edge
of the pool of gasoline and ignited it, seriously burning both T and A, as well as
causing damage to T' s car and P' s gasoline pumps. Consider the agency aspects of
the following controversies possibly arising out of these facts:

1. Assuming T' s action in dropping his cigarette was not negligent:

(a) T sues P for personal injuries and damage to his car.

(b) T sues D Company for such injuries and damage.

2. Assuming T' s action in dropping his cigarette was negligent:

(a) P sues T for damage to his service station.

(b) A files a workmen' s compensation claim against D Company.

II. (30 points) X gave Y express authorization in writing to purchase for X scarce
materials needed in X1 s business. The writing also indicated that
Y was not to disclose his agency. In his own name and with no
mention of X, Y entered into a written contract under seal for the purchase of a
quantity of the needed materials from Z on credit for $1,000. When the $1,000 was
not paid, Z brought suit against Y and secured a judgment. However, Y was judgment-
proof and the judgment was not satisfied. But, as Z was seeking assets of Y
against which to levy, Y's relationship with X came to light. Thereupon Z brought
suit against X. Appraise, on doctrinal and policy grounds, the following matters
that might be advanced as a defense by X in Z' s suit against him:

1. The contract was between Y and Z, and X was not a party.

2. X had paid over to Y the $1,000 for the materials.

3. The judgment that Z bad obtained against Y.

Final Examination in Business Associations (Law 320), Summer Session i960 Page 2

III. (30 points) A and B formed a partnership for the purpose of operating a re-
tail store, and each contributed his agreed share of the capital.
Their relationship was not disclosed, however, and for several

years A operated the store in his own name. In 1959 >

(1) The store delivery boy, negligently operating the delivery truck, ran
into and injured X; and

(2) In response to A's request, B borrowed $2,000 from the Y Bank, advancing
the same to A for use in the business and signing the note simply "B."

About a year later, B sued A for an accounting, in the course of which, of course,
their partnership came to light. Consider the following problems:

1. X's negotiations with A having failed to produce a settlement, X now
sues B for damages.

2. Y Bank having sold B's note to Z, Z now brings suit against the A and
B Partnership and A and B personally on the note.

3. In B's suit against A for an accounting, B asserts a right to interest

on the $2,000 advanced to A, and A counters with a claim for compensation
for his services in running the store.

FINAL EXAMINATION IN COMPARATIVE LAW (Lav 382)
Second Semester 1958-1959 Professor Looper

TOTAL TIME: k HOURS
Write on any five (5) of the following seven questions.

1. Discuss the following aphorisms by Sir Henry Maine:

(a) "Primitive law knows not so much a law of contract as a law of debt."

(b) "Criminal law is the mother of tort law."

(c) "The development of progressive societies has hitherto been a devel-

opment from Status to Contract."
In a final paragraph, briefly assess Maine's contribution to the "science of
comparative jurisprudence."

2. Discuss Holmes' views on:

(a) the common law of agency,

(b) the nature of contractual obligation,

(c) the foundation of liability in tort.

In a final paragraph, briefly assess Holmes' contribution to the "scisnce of
comparative jurisprudence."

3. How do the civil law and common law systems differ in their approach to problems
of procedure? (Admittedly there is a penumbra of ambiguity in the use of the word
"procedure" here, and you may wish to clarify the "procedure-substance" dichotomy.)
Evaluate these differences from the standpoint of procedural law reform in our own
system.

h. In Commissioners of Homochitto River v. Withers, Mr. Justice Handy said:

"What must be understood by the term private property? It appears
to us that it applies to such property as belongs absolutely to an
individual, and of which he has the exclusive right of disposition;
property of a specific, fixed, and tangible nature, capable of being
had in possession and transmitted to another, as houseB, lands, and
chattels."

To what extent is this quotation applicable to the various legal systems you know
anything about?

5. Under the French, German, and common law rules of contract, compare

(a) the practical position of the offeree during the period in which he
is considering whether to accept an offer,

(b) the distinction between unilateral and bilateral contracts.

6. To what extent do the different legal systems follow

(a) the principle of "formlessness" of contractual obligation,

(b) the principle of the "abstract" contractual obligation?

What policy factors are involved in each case? Is there any relationship between
(a) and (b)?

7. "The transition in every legal system is from Trespass to Negligence to Strict
Liability — i.e., from liability based on intentional aggression, to liability
based on non- intentional fault, to liability based on non-culpable causation of
harm." To what extent is this true? Desirable?

MIDSEMESTER EXAMINATION IN CCMPARATIVE LAW (LAW 382)
March 31, 1959 Professor Looper

1. (J+5 minutes) Discuss the role of the jurist in the development of the law:

(a) in the Roman legal system

(b) in the modern civil law system

(c) in the common law system.

(Some particularity of reference is desirable here: be allusive but not
elusive. )

2. (15 minutes) Compare the attitudes of Blackstone and Benttam toward the

common law in general and codification in particular.

MIDSEMESTER EXAMINATION IN COMPARATIVE LAW (Law 382).
December l6, 1959 Professor Looper

TOTAL TIME: 60 minutes

(The two questions count equally)

1. "It may be more or less true of all codes that they represent an end as much
as they do a beginning." Discuss.

2. State concisely the significance in legal history of the following:

(a) William Blackstone

(b) Rudolf von Jhering

FINAL EXAMINATION IN COMPARATIVE LAW (Law 382)
First Semester 1959-1960 Professor Looper

TOTAL TIME: 3 HOURS

Part I (2 1/2 Hours)
Write on any four (k) of the following five questions:

1. "There is more affinity between the Roman jurist and the common lawyer than
there is between the Roman jurist and his modern civilian successor." Discuss this
statement with reference to (a) methods and techniques of legal thought, and (b)
substantive principles of law.

2. "The Anglo-American law of tort, no less than the law of contract, is ill
equipped to meet the needs of an age of standardized mass consumption." Discuss.

3. Comment upon the following statement:

"The more satisfactory treatment accorded problems of formation and form
in French and German contract law as compared with the common law seems
due, in large measure, to the role which speculative and systematic thought
played in the evolution and ultimate codification of these laws. At least
until recent times, the common law has not benefited from any comparable
efforts to think legal problems through systematically and to develop a
rationalized body of legal solutions, rules, principles, and doctrines.
Nor has the common law had the benefit of a thorough legislative reshaping
in the course of which many inherited complexities and encumbrances could
be discarded. In some areas of the law of contracts the common law may
be better today just because this has not taken place; but it would seem
that the common law pays a price in other areas — areas which can benefit
from rationalized, speculatively developed doctrines and in which the
greater freedom of action at any given point in time ordinarily possessed
by a legislature as compared with a court can be of considerable importance
in determining the shape the law will take. At least these are the con-
clusions suggested by a comparative study of the evolution of contract
in the civil and common laws."

k. Under the French, German, and common law rules of contract, compare

(a) the practical position of the offeree during the period in which he
is considering whether to accept an offer,

(b) the distinction between unilateral and bilateral contracts.

5. "From one end of the bookshelf of the centuries to the other, in every mature
legal system, there is only one rule of substantive law in torts -- he who injures
another must make the injured party whole." (Cardozo) Discuss.

Part II (1/2 Hour)

Write short notes on any four (k) of the following:

(a) Jand'heur v. Les Galeries Belfortaises

(b) lesion

(c) the position of the bailee in the common law and civil law systems

(d) the principle of numerus clausus

(e) the "extra -delictual law of damage distribution" in the German legal
system

FINAL EXAMINATION IN CONFLICT OF LAWS (Law 339)
First Semester 1958-1959 Professor Holt

TIME: 3 Hours

Give reasons for your conclusions. Expect no credit for rambling
and impertinent dissertations .

1. State X in its Domestic Relations Law has the following provision:

"A married woman has a right of action against her husband for his wrongful

or tortious acts resulting to her in any personal injury as if they ve-e

unmarried, and she is liable to her husband for her wrongful or tortious acts
resulting in any such personal injury to her husband.... as if they were air^rriec.1'

In its Insurance Law State X has the following provision:

"No policy or contract shall be deemed to insure against any .Liability of an
insured because of death of, or injuries to, his or her spouse or because of injury
to, or destruction of, property of his or her spouse unless express provision
relating specifically thereto is included in the policy."

In State X the S Company, an insurance corporation organized under the laws
of that state and doing business therein, executed and delivered to W, th? wife
of H, an insurance policy binding the S Company "to pay on behalf of the Insured
(w) all sums which the Insured shall become legally obligated to pay as damages
becavse of bodily injury caused by accident and arising out of the ownership,
maintenance or use of the automobile" if the accident occurs "within the United
States of America, its territories or possessions, Canada or Newfoundland." The
policy had no express provision concerning liability of S Company for injuries to
the: spouse of an insured.

H, W, and T were at all material times domiciled and resident in State X.
In State Y, like State X one of the United States, W and H were riding in a
car owned and driven by W when '■/ collided with a car owned and driven by T. H
was severely injured.

Law.

State Y has no statute like the quoted prevision from the State X Insurance

Rights of H in State X: In State

2. H and W, domiciled in State X, were there divorced under a decree awarding
W a certain monthly sum as alimony "so long as she shall remain unmarried . " In
State Y a divorce was procured by M from his wife, S, who was served only by
publication in State Z, where she resided. 3 neither appeared nor pleaded in M's
divorce suit. M, shortly after this State Y decree, married W in State Y. The
two at once went to State Z to reside. S in State Z sued M for separate mainten-
ance and obtained a decree in her favor. M appeared and contested the suit; the
court found that M's divorce in State Y was "null and void." W then sued M for an
annulment of their marriage. M defended, but the court found that their alleged
marriage in State Y was "null and void" because M had another wife livinr at the
time of the alleged marriage between M and W, and gave a decree for W. W now sues
H in State X in a federal district court for alimony alleged to have accrued since
the date of her "void" marriage to M. Discuss W's rights.

Final Examination in Conflict of Laws (Lav 33^), First Semester iy5o-V Page c.

3. '. statute of the United States provides tnat United States District Courts may
entertain civil actions against the United States "for money damages. ..for injury
or loss of property, o± personal injury or death caused by the negligent or wrong-
ful act or omission of any employee of the Government while acting within the scope
of his office or employment, under circumstances where the United States, if a
private person, would be liable to the claimant in accordance with the law of the
place where the act or omission occurred."

P was employed by E to work primarily in State X, but while in State Y in the
course of his employment, p was injured by the negligence of an employee of the
United States who was acting within the scope of his employment. During the period
of his disability F was paid his regular wages by £. Under the law of State X,
there was no duty on P to reimburse E for such payment out of the proceeds of any
recovery P might have against the United States . Accordingly, under such circum-
stances State X would have allowed recovery for loss of wages during the period
of disability, but State Y would not. P sued the United States in a district
court in State Y.

(a) How could a judgment allowing recovery for loss of wages be upheld'.

(b) How could a j augment denying recovery for loss of wages be upheld'.

k. The Workmen's Compensation Act of State X is applicable to injuries received
inside or outside of the state when the employment contract is made in the state,
and under the Act every employer and employee shall be "conclusively presumed to
have elected to accept" the Act unless "prior to the accident" he shall have filed
with the Compensation Commission a written notice that he "elects" to reject the
Act. The Act further provides that the rights and remedies granted by it "shall
exclude all other rights and remedies at common law or otherwise" on account of
the injury or death.

The Workmen's Compensation Act of State Y provides an "exclusive" remedy for
an employee against the employer, but not against a third party.

W was an employee of E (a painting contractor), both residents of Sta';e X,
unaer a contract of employment made in State X. Neither W nor E ever filed a
written notice of "election" to reject the State X Workmen's Compensation Act.
E was insured against liability under the Workmen's Compensation Acts of X and
Y. T was a general contractor for a construction job in State Y and as such made
a contract with E as subcontractor for certain painting in connection with this
construction job. While on the painting job in State Y, W was injured by the
negligence of T.

Discuss rights and remedies of W.

5. In State X Saunders sold and delivered to Brooks a chattel under a contract of
conditional sale. In State X Brooks defaulted on his payments, but sold the
chattel outright to Peterson, a bona fide purchaser with notice. By the law of
X Saunders ' reservation of title was valid between the original pa. ties to the
contract of conditional sale and as against Peterson. In State Y Peterson sold
and delivered the chattel to Davis, a bona fide purchaser without notice. By the

Final Examination in Conflict of Laws (Law 339), First Semester 1958-9 Page 3.

law of State Y conditional sales contracts are enforced as between the original
parties and subsequent purchasers with notice, but are invalid as against bona
fide purchasers without notice and creditors of a vendee in possession urder a
contract of conditional sale. Davis took the chattel to State Z, the law of which
is similar to that of State X, and there Saunders sued Davis to get repossession
of the chattel. Result 1

6. A statute of State X provides that "every conveyance. . .affecting the estate...
of any married woman in lands... must be executed by such married wo-nan and her
husband; and due proof or acknowledgment thereof must be made as to the husband
and as to the wife; and the privy examination of the wife touching her voluntary
assent to such conveyance shall be taken separate and apart from her husband. . .
and such acknowledgment or proof and privy examination shall be certified...." H
and W were man and wife domiciled in State Y, where there is no requirement for the
separate examination of a married woman when conveying land. In State Y, H and W
executed and delivered to B a deed to land which W owned in State X. The price
paid VI was $200, admittedly a fair and equitable price. The deed was a warranty
deed and on its face was executed with all necessary formalities, but W had not
been examined separate from her husband, H, in accord with the statute of X.
Twenty years later, when the land had been improved by successive grantees and
was worth $20,000, W sued in State X to recover the land and damages for ius deten-
tion. The defendants claimed by mesne conveyances from the original giantee, B.
Result T Is your conclusion in accord with that section of the Restatement that
"capacity to make a valid conveyance of an interest in land is determined by the
law of the state where the land is"?

7- Under the law of State T an action in tort does not survive the death of the
tort feasor; the lav of State F is to the contrary. F, a domiciliary and resident
of State T, was driving his car with due care in that state when D, a domiciliary
and resident of State F, negligently drove his car into P's and injured P severely.
D was also injured in the collision and died as a result of his injuries- D left
estates in both States T and F, and administrators were appointed in each state.

Rights and remedies of P7

FINAL EXAMINATION IN CONFLICT OF LAWS (LAW 339)
First Semester I959-I960 Professor Holt

Time : Three hours

USE CLEAR AND CONCISE ENGLISH. GIVE REASONS FOR YOUR CONCLUSIONS. YOU
ARE FREE TO MAKE ASSUMPTIONS OF LAW OR FACT REASONABLY CALLED FOR BY THE
QUESTIONS, BUT ALL SUCH ASSUMPTIONS MUST BE CLEARLY STATED.

1. In State X marriages between first cousins are not prohibited, but in States
Q, Y and Z such marriages are by statute prohibited and declared void. H was
domiciled in State Q when he received an advantageous offer to engage in business
in State X. He accepted the offer, moved to State X, and six months after his re-
moval married W, his first cousin, in State X by a ceremony that complied with the
law governing celebration of marriage in State X. H and W lived together as man
and wife in State X for five years and then moved to State Y, where they lived
together as man and wife. Two years after such removal H died intestate, owning
land in State Z. A week after the death of H, his only child, a son S, was born
to W. The State Z Cede provides that

"The status of legitimacy is determined by the law of the domicil of the
parent whose relationship to the child is in question."

Is S entitled to inherit any interest in the Z land as legitimate son of H?

2. W sued H for divorce in State X. H entered a personal appearance and contested
the suit on the merits, but the court, finding that W had a domicile in State X,
granted W a divorce and $200 a month alimony "until she should semarry." M and S
were domiciled as man and wife in State Y. M left S in State Y, went to State Z,
and two months later sued S for a divorce in State Z. S was served only by publi-
cation and made no appearance in M's divorce action. The Z court, finding that M
was domiciled in Z, granted M a divorce. M married W in Z. H then ceased to pay
alimony to VJ. Later W sued M in Y for an annulment of the marriage. M was person-
ally served in this action, but defaulted, and the Y court, finding that at all
material times M had been domiciled in Y, granted W an annulment on the ground that
at the time of the marriage ceremony with W, M "had another wife living." W then
sued H in an action at law in State Z for arrears of alimony from the time of the
marriage ceremony with M in State Z. Personal service was had in State Z on H,
who pleaded that the marriage in Z between M and W had terminated his duty to pay
alimony under the State X decree. As counsel for W, how would you plead and argue?

3. To secure a loan made by C to him, M in State X executed and delivered to C a
chattel mortgage of cattle then in State X and owned by M. The chattel mortgage
was duly recorded in State X and was legally executed in accordance with the laws
of State X. Later M delivered the cattle to D in State Y, a livestock commission
merchant . D sold the cattle in the usual course of trade to bona fide purchasers
without knowledge of the chattel mortgage. C consults you about a possible action
against D for conversion. Discuss the possibilities of C's recovery of a judgment.

Final Examination in Law 339, First semester 1959-1960 Page 2.

h. State X has a statute giving a right of action for wrongful death to "the per-
sonal representative" of the person wrongfully killed. It also has a statute that
provides that

"The defense of contributory negligence shall, in all cases whatsoever, be a
question of fact, and shall, at all times, be left to the jury."

In the only case involving the latter statute before the Supreme Court of
State X, it was held that the statute could, consistently with due process, apply
to the trial of an action based on an accident occurring in State X before the
enactment of the statute, the statute being regarded as one regulating procedure.

In State F a trial court has power to direct a verdict on the issue of con-
tributory negligence.

R was killed in a railway crossing collision in State X when the car he was
driving collided with an engine operated by I i ailroad. P, the duly qualified
"personal representative" of R, sued D Railroad in State F. At the close of de-
fendant's case, counsel for D Railroad moved for a Erected verdict on the ground
that all evidence introduced showed beyond reasonable doubt that R had been guilty
of contributory negligence .

(a) Indicate the reasoning that would lead the court to deny the motion.

(b) Indicate the reasoning that would lead the court to grant the motion.

(c) Which of the two decisions would be better and why?

5- (a) A statute of State X prohibits anyone from following the business, tem-
porarily or otherwise, of a real estate broker in X without first procuring a
license. The statute further provides that no person acting as a real estate broker
within the State of X shall sue for a commission in the courts of X for the per-
formance of any act as a real estate broker in State X without alleging and proving
that he was a duly licensed real estate broker at the time the alleged cause of
action arose.

D, the owner of land in State X, in State Y requested P, a resident of State
Y and duly licensed as a real estate broker under the law of Y, to procure a pur-
chaser for such land at a sales price of $300,000, and agreed to pay P a commission
of 5$> for services in procuring such a purchaser. P fully performed, but D refused
to pay the commission. P sued D in the proper court of State X. D moved for dis-
missal on the ground that the complaint did not state a claim upon which relief
could be granted. The court dismissed the action.

(b) State A has a statute that provides that no person is to be charged on a
promise to pay a real estate broker a fee for procuring a sale of land unless the
promise is in writing and signed by the person to be charged. D, the owner of land
in State B, there employed P, a broker resident and duly licensed in State B, to
procure a purchaser for such land and promised to pay a commission of 5$> of the
sale price, but the promise was not in a writing signed by D. P procured in State
A a purchaser of the land and in State A the deed of transfer to the purchaser was
delivered. D refused to pay the agreed commission. P sued D in State B. The court
refused to rule that the contract to pay a commission had to be in writing as re-
quired by the State A statute and gave judgment for P.

Final Examination in Law 339, First semester I959-I960 Page 3.

(c) State F has a statute that "no contract for the payment of any sum of
money as a commission for the finding, by one person, of a purchaser for the real
estate of another shall be valid, unless the same shall be in writing, signed by
the owner of such real estate or his duly qualified representative." In State S a
parol contract for the payment of a commission for the sale of real estate is valid.
In State S David made a parol agreement with Peter for the payment of a commission
to Peter for effecting a sale of land in State S owned by David. David refused to
pay. Peter and David had been residents of S, but David became a resident of F and
in that state Peter brought an action for the recovery of his commission. He re-
covered judgment.

In each of the three cases just stated write an opinion in support of the de-
cision. Indicate briefly how the three decisions can be reconciled.

6. State X has a statute that removes all contractual incapacities from married
women. State F has a statute that removes contractual incapacities from married
women with one exception: It expressly states that married women shall be incapable
of contracting as sureties or guarantors for their husbands. D, a married woman
domiciled with her husband, H, in State X, promised in State F by writing there
delivered to C, a domiciliary of State F and engaged in a wholesale business there,
to guaranty payment of goods that might be sold on credit to H by C during the
following thirty days. In reliance on D's promise, C on H's order shipped goods
from F within the thirty-day period to H, who accepted the goods at his place of
business in State X, but who unjustifiably refused to pay therefor. Discuss C's
rights against D.

7- C, a domiciliary and resident of State X, was driving his car with due care in
that state when D, a domiciliary and resident of State F, negligently drove his
car into C's and injured C severely. D also received injuries from the collision
and died as a result thereof. He left estates in both States F and X; and admin-
istrators were appointed in each state. Discuss the rights and remedies of C.

FINAL EXAMINATION IN CONSTITUTIONAL LAW (Lav/ 310)
Second Semester 1958-1959 Dean Sullivan

TIME: 1+ HOURS

1. The State of X levied a tax on the gross income of all individuals and
corporations domiciled in the state and a tax on the gross income of foreign
corporations j based on the income derived from business activities in the state.
The ABC Corporation was chartered in X and therefore was a domestic corporation
with its principal place of business in X. It engaged in the manufacture of
machinery. ABC had income from the sale of manufactured articles which were
sold F.O.B. the factory in X. Some machinery was sold F.O.B. the place of
business of the buyer in other states so that the price included the cost of
transportation in ABC's own trucks. One part of the principal product required
some special processing which was done in State Y. The parts were trucked to
State Y in the vehicles owned and operated by ABC and were returned in the

same trucks. The price paid for the processing was included in the sale price
of the finished machinery. ABC also had income from some state bonds of State
Y and from some United States Government bonds. ABC refused to pay the taxes
and, when sued by State X, defended on federal constitutional grounds. Which
parts, if any, of the gross income are taxable? Why?

Would it make any difference if this had been a foreign corporation? Why?

What effect would it have on the outcome of the case, if any, if the tax
had been called a privilege tax? Give reasons.

2. Johnny Senno, a notorious gangster, was picked up in a police dragnet after
the shotgun murder of one of Senno1 s competitors in the gang world. He was
taken by the sheriff of the county in which he was arrested to the jail of an
adjoining county where he was questioned at length about his whereabouts at the
time the crime was committed. No force was used and he was permitted the usual
amount of time for sleeping and eating, but the police questioned him continuously
during his waking hours for four days; for all of this period he was denied the
right to call an attorney or his friends. While he was under arrest, the police
went to his apartment and conducted a careful search to discover anything that
would connect him with the crime. They seized a gun which was proved to be the
murder weapon and some letters indicating that there had been a disagreement
between Senno and the murdered man.

Senno at first demanded a lie detector test, which the police refused to
administer. At the end of the fourth day of questioning, he confessed. He
then was permitted to call an attorney, but he became dissatisfied with his
lawyer and subsequently dismissed him. At the trial, he appeared without an
attorney and, although the court offered to appoint one for him, Senno refused
to accept the attorney named by the judge. He went to trial without assistance
of counsel.

At the trial the confession and the gun and letters secured by the search
of his apartment were admitted in evidence. The jury convicted him of murder,
and, under the 6tate Law, made no recommendation for the sentence. In a sub-
sequent proceeding, the court heard evidence of prior convictions for crimes
and the general unsavory character of Senno. Acting on this information, which
was not subjected to cross-examination, the judge sentenced Senno to be executed.

Assume that no state constitutional provision had been violated and that the
defendant raised the federal constitutional questions at the appropriate time .
Should the conviction be affirmed or reversed? Discuss fully.

FINAL EXAMINATION IN LAW 310, Second Semester 1958-1959 Page 2.

3. The legislature of State A passed a statute providing for a grant of scholar-
ships of $500 each to graduating seniors of the state's high schools who scored
the highest on a state examination. The scholarship would be available to the
student only if he could show "need" for public support for his education. He
could use the scholarship at any school within the state, and the tuition would
be paid by the state to the college for any academic program he chose, including
the study for the ministry in a sectarian seminary.

(a) Is this statute valid under the United States Constitution?

Suppose State B, below the Mason-Dixon Line, had a similar statute and the
scholarship was used at a private school which was operated as a segregated
college.

(b) Is this statute constitutional?

(c) Would it make any difference in (a) and (b) if the tuition were paid
for a secondary school? A primary school?

State X has a similar statute which provides a scholarship of $1,000 per
student for all in the upper 2$ of the high school graduating class with a
minimum of one scholarship to each school, regardless of size.

(d) Is this program valid?

k. In 1955, the legislature of State X passed a statute requiring every truck
using the roads in the state to have lights which completely outlined the vehicle,
so as to give other drivers notice of the size of the truck. This statute also
imposed certain requirements on the size of tires of the trucks, the weight and
load limitations, and the brakes which had to be installed. State Y, which
bordered State X, had regulations which differed materially from those of X.

(a) Are these regulations valid? Why?

In 1959, the Congress passed an act as follows:

"1. The business of trucking on the highways shall be subject to
the laws of the several states which relate to the regulation of
safety on the highway.

"2. No Act of Congress shall be construed to supersede any law
enacted by a state to regulate safety on the highway , unless the
Act of Congress expressly provides that it shall supersede the
state enactment."

(b) Discuss the validity and effect of this act of the Congress.

5 • The legislature of State X passed the following statute :

"It shall be unlawful for any person, firm or corporation to
manufacture, sell, or offer for sale, advertise or publish,
present or exhibit in any public place in this state any
lithograph, moving picture, play, drama or sketch, which
publication or exhibition portrays depravity, criminality,
unchastity, or lack of virtue of a class of citizens, of

■

FINAL EXAMINATION IN LAV/ 310, Second Semester 1958-1959 Page 3-

any race, color, creed or religion, which said publication or
exhibition exposes the citizens of any race, color, creed or
religion to contempt, derision, or obloquy or which is pro-
ductive of breach of the peace or riots . Any person, firm or
corporation violating any of the provisions of this section,
shall be guilty of a .misdemeanor, and upon conviction thereof,
shall be punished by a fine of not less than fifty dollars
($50), nor more than two hundred dollars ($200)."

A was charged with publishing and distributing the following statement:

"Protect our country from the EPISCOPALIAN MEIIANCE.

"The Episcopal Church in the United States is the agency of
Great Britain in our country. It works to undermine democracy
and to turn us over to Socialist Great Britain. It is cor-
rupting our people and undermining our power to resist British
propaganda. Shun all Episcopalians and use your influence to
prevent the growth of the Church in the United States."

(a) A was prosecuted under the statute and he defends on the ground
that the statute is unconstitutional. What result? Why?

B, a motion picture theater owner, showed a war film which depicted Japanese
in a very unfavorable light. It showed them as killers of defenseless prisoners
and as arrogant conquerors in areas in which they had been successful.

(b) B was prosecuted under the same statute. What result? Why?

■

FINAL EXAMINATION IN CONSTITUTIONAL LAW (law 310)
Second Semester 1959-1960 Dean Sullivan

Total Time: 3 l/2 Hours

You are urged to read the questions carefully and to prepare your analysis
before you begin to write. Maximum credit will be given for concise and
accurate analysis and for application to that analysis of your knowledge
in this field. No credit will be given for excessive length of answers.

1. The School and University Employees Union is a national labor organization
which is composed of local unions in many states. The Union's by-laws provide
that membership shall be restricted to white persons. The Union represents the
employees in certain classes of employment in collective bargaining with the
University of Illinois, a state supported institution. Though not required to do
so by law, the University recognizes the Union, and wages and other terms and
conditions of employment in the classes represented are negotiated between the
parties and are applicable to all in these positions. Because of the civil service
laws of the State, the Union does not have either a closed or union shop contract
with the University, but the Union does urge its members to apply for positions
and to take the civil service examinations, and urges the employing agencies

to select from the applicants the individuals who are members of the Union.

Two non -white applicants were denied membership in the Union. They seek to
enjoin the Union from enforcing its by-law in a way which prevents their membership,
and they also seek to enjoin the University of Illinois from continuing to recognize
the Union. The Illiana Local of the Union is willing to accept the applicants
but is unwilling to risk expulsion from the national if it does so. Assume that
the National Labor Relations Act does not apply.

Decide all of the issues presented by the petition for an injunction.
Discuss fully.

2. The Red Ball Trucking Company operates common carrier motor trucks exclusively
in interstate commerce under a certificate of convenience and necessity issued by
the Interstate Commerce Commission. Trucks operate between Louisville, Kentucky,
and Chicago, Illinois. There are three kinds of vehicles: twenty-ton semi-trailers
which are operated over the road; twenty-ton semi -trailers of special construction
which are operated piggy-back on special cars of the Pennsylvania Railroad
between the same points when the shipment consists of a full truckload, delivery
then being made in the large truck directly to the consignee; and five-ton trucks.
For less than truckload lots, the load is assembled at terminal warehouses and
docks at the two terminal cities. A truck is unloaded, breaking the bulk at the
warehouse, and individual deliveries are then made in the five -ton trucks located

at the two terminal cities. Similarly pickups are made and brought to the warehouses
for loading into the through vehicles. Occasionally goods may be stored temporarily
in the warehouses. It should be clear that all shipments are received from or
destined for transportation outside the state.

The State of Kentucky sought to impose the following taxes:

1. A warehouse tax of five cents per square foot on all warehouse space.

2. A personal property tax on all of the five -ton trucks in Kentucky, and
one -half of the value of all of the through trucks.

Final Examination in Law 310, Second Semester 1959-63 Page 2

3. A personal property tax on the value of all of the property which is
stored in the warehouse on tax day.

h. A franchise tax measured by the gross income from shipments which originate
in the State.

Determine the validity of these taxes. Explain.

3. The State of Missokan becomes concerned over juvenile delinquency and especially
about the increasing crimes of violence being committed by persons of tender years.
The Legislature creates the Missokan Youth Commission. The statute provides that
no action of the Commission shall ever be considered to be an adjudication of
criminality on the part of any minor under its jurisdiction. The Commission is
given exclusive jurisdiction of proceedings concerning any minor under the age of
18 living or found in Missokan:

"(a) who has cocmitted what would otherwise be a crime, whether state or
local, or (b) whose environment is injurious to his own or another's
welfare, or (c) who, upon the testimony of at least two psychiatrists
licensed by the Department of Health of the State of Missokan, is found to
be a probable future incorrigible, whose presence at large within this state
presents a clear and present danger of public offense or disorder."

For any minor found by the Commission to come within the terms of the statute,
the Commission may prescribe curative custody in an appropriate state institution
until such time as the Commission shall find that the interests of the minor shall
permit his release. A separate section of the statute provides for 'Procedures
in Minors' Cases, ' which shall be "conducted in an informal manner" from which
the general public shall be excluded and to which:

"only persons shall be admitted whom the presiding Commissioner finds to
have a direct interest in the case or in the work of the Commission.
The minor shall be excluded from the hearing at any time at the discretion
of the presiding Commissioner.'

The statute further recites that

"in the interest of the minor and for facilitating speedy and accurate
decisions as to his physical, mental, and social well-being, technical rules
of evidence shall not be utilized. Whatever evidence the Commission
deems reasonably probative shall be admitted, including reports of
social and psychiatric workers who may have made investigations of the
minor's environment, experiences, character, or aptitudes.

'The record in any case before the Commission shall be sealed
at the close of the hearing and shall not be available to the press."

Terrible Terry was placed in a security institution for minors after a
proceeding conducted under the above statute. His father, Thomas Terry, files a
petition for the release of his son on the ground that the statute is unconstitutional.
What result V Discuss fully.

-

Final Examination in Law 310, Second Semester 1959-60 Page 3

h. The governments of Great Britain, United States, and Mexico have become concerned
over the deterioration of good relations between Cuba and the other states in the
Organization of American States. They fear that the anti-Yankee campaign carried
on by Castro and his followers will evoke anti-Cuban activities in the United
States, Mexico, and the West Indies Federation. Britain, Mexico, and the United
States negotiate a treaty in which each agrees "to restrict expressions of press,
radio, or television, circulated or broadcast across international boundaries,
directed against governmental institutions, which expressions have as their purpose
the undermining of an existing government or giving aid or assistance to a
revolutionary movement in any country in this hemisphere." A Florida radio
station, WMNO, broadcast anti-Castro propaganda. The Federal Communications
Commission revoked the license of the station. WMNO files a petition in the
Court of Appeals to rescind the order of the Commission. (Assume that this is
the correct procedure.) What result? Why?

5. The state of Calvada is the owner of a local railrcad which serves as a bridge
for transfer of freight between railroads engaged in interstate commerce, and
which also furnishes service to the wholly owned decks at which ships in foreign
commerce load and unload.

The Railway Labor Act (United States) requires every railroad to bargain
collectively with representatives of its employees. The state of Calvada requires
all of its employees to be selected through merit system procedures. All persons
so selected are civil service employees of the state, and their compensation and
terms of employment are fixed by the Legislature. The civil service act prohibits
collective bargaining by civil service groups and makes illegal and unenforceable
any collective bargaining contract which might result frcm this prohibited
bargaining process.

A group of employees of the state who work on the state-owned railrcad
file a petition with the Railway Labor Beard, asking that the managers of the
state railway be directed to bargain with their representatives. Assume that
the state railroad comes within the definition of that term in the federal act.
What result? Why?

MIDSEMESTER EXAMINATION IN CONTRACTS A (Lav 301)
November 2k, 1958 Professor Davis

TIME ALLOWED: Fifty-eight Minutes

1. Curing World War II some thirty ships were wrecked or grounded in shallow waters
adjacent to New Guinea. After the War the Australian government commissioned a
private corporation to dispose of the vessels within a specified time. Some of the
ships were salvaged by the corporation, some were towed to deep water and sunk, and
others were sold for salvage. The corporation advertised for bids for "an oil
tanker, approximately 6,000 tons, on Jourmaund Reef about 100 miles north of
Samurai." Actually there was no such tanker in existence, although an agent of

the corporation had heard unverified rumors from shipping interests that there was
a stranded tanker in the designated place. In fact the only vessel stranded on
Jourmaund Reef was a 12,000-ton Japanese submarine tender.

Captain Strong tcaae tne highest bid for the tanker, and it was accepted
by the corporation. After an unsuccessful search for the nonexistent ship, during
which the submarine tender was located, Captain Strong brought suit in a common- lav
court for damages for breach of contract. He then brought a second action to re-
cover expenses incurred prior to discovery of the submarine tender and for expensed
of hia return voyage from the point of such discovery. What decision in each case,
and vhy?

2. D's salesman called on M and demonstrated a new type of industrial vacuum
cleaner manufactured by D. M was favorably impressed, and after some diccussion
of price, terms, and delivery dates, the salesman filled out a printed form which
read: " NONCANCSLLABLE ORDER. Not binding on D until accepted by D in writing.

To D — Customer hereby orders ten Model Z cleaners for delivery in 28 to 30
days. Price $200.00 each, delivered to Customer's place of business. T^rms

cash in 60 days. Signed , Customer. Above order accepted

." This document was signed by M in the space preceding

the word "Customer," and was then promptly transmitted to D by the salesman. Upon
receiving it, D at once shipped the ordered cleaners to M, shipping charges prepaid.
While the goods were in transit, M wired D: "Cancel my order." On arrival of the
cleaners, which was prior to the delivery of M1 s telegram to D, the carrier
attempted to deliver the cleaners to MatM's place of business, but M refused to
receive them. Dees D have an action for breach of contract? Give reasons.

End of Examination

FINAL EXAMINATION IN CONTRACTS A (Law 301)

First Semester 1958-59 Professor Davis

TIME ALLOWED: THREE HOURS

Instructions: The examination consists of three questions, which will be weighted
as follows for grading purposes: Question 1 — 3 A3

Question 2 -- 5/13

Question 3 -- 5 A3
At least 75 minutes should be reserved for Question 3, which will require a close
reading and careful analysis of the agreement set out in the Appendix.

1. During 1958 T bought from R. at 25^ per pound, a considerable quantify of
industrial grease known as "R-Lube." Meantime, during 1958 R developed r new,
lighter weight grease suitable for some but not all of the purposes for which
"R-Lube" is suitable, taking great pains to keep the development work secret. By
the end of the year the new product was ready to market and was designated on R's
records as "R-Lube Special. On January 2, 1959, R mailed to about 1000 of his
customers a card reading:

R is now offering for immediate order in any quantity not
exceeding 2000 lb. R-Lube Special at 20^S per pound. This is
an economy product of good quality. Detailed technical speci-
fications will be provided on request.

R knew the new product was not heavy enough for T's operations and dia not intend
that a card go to T. One of the cards, however, was sent to T by reason of a
clerical error in R's office. T at once wrote R: "Am pleased to note the special
price on R-Lube. Send me 2000 pounds." Upon receipt of this Tetter R telephoned
T, learned that a card had reached T, explained that the card had been sen" to
him by mistake, and informed T that a new product was intended by the phrase
"R-Lube Special." T nevertheless insisted that he had a contract for 20C0 j. sunds
of R-Lube at 20^ a pound. The prevailing price on R-Lube was then and has re-
mained at 25^ per pound.

Assume that R consisted you at once . Indicate your advice to R concerning his
legal relations tfith T.

2. Bullionhead, a wealthy farmer and philanthropist, wanted to help his nephew
Morpheus, a down-and-out narcotics peddler who was too proud to accept charity.
Accordingly he wrote Morpheus as follows: "If you will come down and take care

I of my little flock of Buff Orpingtons /a good all-purpose breed/ until I die, you
can have room and board for tne rest of my life and my private swamp in Florida
when I go. The Buffs are just too vicious for me to handle." Morpheus left the
skid row where he had been working and went to Bullionhead ' s farm, where ho cared
for the chickens (there were about six in the flock) without incident for three
months . At this point Bullionhead became disturbed by Morpheus ' apparent interest
in Bullionhead' s teen-age daughter. Bullionhead privately informed his v».fe one
!evening: "I'm going to kick that Philadelphia aainliner off the farm tomorrow."
Bullionhead 's wife, who was secretly enamored of Morpheus, replied: "If you will
'let Morpheus stay for another two years, I promise that at the end of that time
I shall contribute from my separate funds at least $5000 a year to your favorite
charity as long as I live." Bullionhead agreed. About a year la^er, however, he

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Final Examination in Contracts A (Law 3°l) Page 2

evicted Morpheus from the farm. Several months thereafter, Bullionhead died of a
heart attack while chasing an escaped Buff Orpington. By his will Bullionhead
devised the Florida swamp to his daughter. What decision in the following law-
suits, and why?

(a) Morpheus v. Bullionhead 's executor for breach of an alleged contract by
Bullionhead to furnish Morpheus with room and board for the rest of Bullionhead' s
life and to leave the swamp to Morpheus.

(b) Bullionhead 's widow v. Bullionhead 's executor for breach of an alleged con
tract with the widow, the breach consisting of evicting Morpheus as stated above.

3. Construction Company (plaintiff) entered into the agreement w? ';h Donald Digger
(defendant) which is attached hereto as an appendix. The highway improvement
referred to in the agreement was to consist of a new stretch of highway for about
five miles through a low and usually wet area. 3efore work began, the area was
filled partly with about 50,000 cubic yards of refuse from an old city dump (de- •
scribed In the agreement as "dump removal") and partly with about 100,000 yards
of sandy earth (described in the agreement as "unsuitable earth removal"). It
was clear that neither type of stuff was usable in the new roadbed, and that most
of it could be removed by filling with water and dredging. Defendant moved his
equipment onto the site on October 28, 195$, hut never removed any "dump" or
"unsuitable earth." He stalled for about a month, saying his dredge would not
work, and then abandoned the job. Plaintiff had the dredging done by another
subcontractor at a cost considerably in excess of the estimated cost under ios
agreement with defendant .

Plaintiff now sues defendant for breach of contract. What decision?

End of Examination

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FINAL EXAMINATION IN CONTRACTS A (LAW 301)
Second Semester 1958-1959 Professor Davis

TIME ALLOWED: THREE HOURS

1. Your client is a wealthy sportsman, Sam Schooner, who owns a yacht which
he keeps in a yacht basin at the port of Fantail. For some years he has been
eager to employ Spelvin Spar, a native of Fantail, as the captain of his
yacht. On May 20 he heard that Spar was free for the summer season this
year. He immediately sent a telegram to Spar reading: "ONCE AGAIN OFFER YOU
POSITION AS CAPTAIN OF MY YACHT, JUNE THROUGH AUGUST, SIX HUNDRED PER MONTH,
CREW OF TWO OTHERS PAID BY ME. LET ME HEAR BY NOON WEDNESDAY TWENTY SEVENTH.
SAM SCHOONER." Late on the evening of May 21 Schooner received a telegram
reading: "WOULDN'T SAIL YOUR BUCKET FOR TWICE THE PAY. SPELVIN SPAR."
Schooner began looking around for another captain. He met with Paul Poopdeck
on Saturday, May 23- Because he knew that Schooner preferred Spar as his
captain, Poopdeck was at first reluctant to take the job, but finally signed
a contract as captain for the season. On Wednesday morning, May 27, Schooner
received a letter from Spar reading: "Have not heard from you since my letter
was mailed last Thursday. Do you still want me to report? Sincerely yours,
Spelvin Spar." As soon as he could, last Sunday, May 31, Schooner made a
trip to Fantail to find out what had happened. He learned that the day after
receiving his telegram, Spar had had dinner at the Mai de Mer Inn with some
fellow seafarers. Spar had shown them his offer from Schooner, and in their
presence had written out an acceptance which he had posted at once in the
lobby of the Inn. For some unknown reason this letter never reached Schooner.
After Spar had gone home early, his companions stayed on at the Inn and had

a good many drinks. Someone conceived of a practical joke on Spar, and the
result was the telegram previously set forth. After posting his acceptance,
Spar declined two other offers of summer employment, and still desires to
serve as captain for Schooner.

Schooner wants to know whether he is legally bound to Spar, and whether there
is any way he can get out of his deal with Poopdeck.

2. Fifteen years ago two friends, Herm and Sherm, were picnicking on a
riverbank with their fiancees. Herm's girl, Torchy, who could not swim,
accidentally fell into the river and was in obvious danger of drowning.
Herm yelled, "I can't swim either," whereupon Sherm dived in and expertly
rescued Torchy. Some days later Herm wrote Sherm: "You have saved my
future wife, and I am going to pay you $1000 to show my gratitude." Sherm,
although preserving the letter, did not answer it or ever mention it to
Herm until a few weeks ago. Meanwhile over the years Herm has prospered in
business, whereas Sherm has always been a pauper. He and his apparent wife
Sheila have frequently stayed for long periods as guests in the mansion
owned by Herm and Torchy. The last such visit terminated in an acrimonious
exchange between Herm and Sherm, in which the former described the latter as
a "meathead," "bum," "freeloader," and "deadbeat." Sherm then reminded
Herm of his letter as previously set forth. Herm vigorously protested that
he had merely forgotten the letter and would "pay the lousy thousand next
Monday." As Sherm and Sheila departed, bag and baggage, Herm handed Sherm

a signed "IOU" for $1000. A week later, Sherm received the following letter:

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FINAL EXAMINATION IN CONTRACTS A (LAW 301 ) Page 2.

Dear Sherm,

Much to my astonishment, I have just learned that you and Sheila
never went through a marriage ceremony. To the shame of our-
selves and our friends, it now appears that for years we have
"been fraternizing with mortal sinners. For this reason, it
will be impossible for me to pay you $1000 or any other amount.

Regretfully,
Herm

Sherra now seeks your advice concerning his chances to recover $1000 in a
legal action against Herm.

3. On April 1, X Hotel Company announced that it planned to build a new
hotel. Anticipating that the Company would soon invite bids for con-
struction, P, a bathtub dealer, obtained the plans and submitted a bid
on bathtubs to a number of general contractors considered likely to bid on
the construction job. P's bid contained the following statement: "This
bid is an offer to supply bathtubs at the above rates and in accordance
with the terms herein recited. This offer is firm and will not be re-
voked prior to May 20. However, if our bid is used by you in submitting
your bid for construction of the hotel, this offer will be revoked on
May 7 unless you notify us by then that you have used our bid." One of
P's bids was sent to D. On May 1, the X Hotel Company invited bids from
general contractors, and D submitted a bid. On May 6, D wired P: "We
used your bid on bathtubs on the X Hotel project." P received the wire
on the same day. On May 8, P wrote D: "We regret that we must revoke our
offer to supply bathtubs." D immediately replied: "We reject your attempted
revocation." On May 11, D was awarded the contract to build the hotel.
That day D wired P: "You will be glad to hear that we got the X Hotel job.
We will contact you about it soon." Upon receiving this wire, P set
about acquiring enough bathtubs to carry out his offer to D. On May l6,
after P had acquired the bathtubs, D notified P: "We will buy our bathtubs
from Y. Thank you for dealing with us." P has been unable to dispose
of the bathtubs, and now sues D for breach of contract. Decide the case.

h. The Whole Hole Company, excavators, contracted with X to do specified
excavation work for $5000 on a lot owned by X, preliminary to construction
of a nuclear explosion shelter planned by X. When the work was about half
finished, Whole Hole found that it would lose from $500 to $1000 on the
contract because of an unexpected rise in the cost of labor since the
contract was made. Whole Hole notified X that it would not complete the
job unless X would agree to pay $500 more, and X agreed to do so. Dr.
Headshrinker owned and operated a psychiatric clinic on an adjoining lot.
Thinking that the explosion shelter would enhance the value of his practice,
he also promised to pay Whole Hole $500 if it would go ahead and finish
digging. Whole Hole then completed its work. The explosion shelter was
finished shortly thereafter. X built a steel fence around it and posted
several large signs reading: "PRIVATE. KEEP OUT AT ALL TIMES'. TRESPASSERS

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FINAL EXAMINATION IN CONTRACTS A (LAW 301) Page 3-

WILL HE PROSECUTED." Subsequently Dr. Headshrinker climbed the fence out
of curiosity and was snooping around inside the shelter when an abandoned
USAF aircraft crashed squarely on top of it. Headshrinker was uninjured.

(a) Whole Hole now sues X and Headshrinker to recover the additional
amounts promised by them respectively. What decision in each case?

(b) X sues Headshrinker to recover the value of Headshrinker f s life. What
decision?

End of Examination

MIDSEMESTER QUIZ IN CONTRACTS A (Law 301)
April 21, 1959 Professor Davis

1. A wrote 3 on April 1: "I will give you $600 for your Ford car,
provided you deliver it to the above address /stated in the letterhead/ on
or before noon, April 10. My offer is not subject to countermand." B
replied by mail the following day: "I accept your offer with regard to
the Ford, and I promise to deliver it to the address you specified on or
before noon, April 10.'' This letter was not received by A until April 8.
A had bought another Ford from C for $500 a few hours before. C on the
same day encountered B on the street and happened to mention to B that

he, C, had just sold a Ford to A for $500. B nevertheless drove his Ford to
the address A had specified and parked in the driveway at 11:55 a.m. on
April 10 . A was taking a shower and did not answer B ' s ring on the door-
bell until 12:05 p.m. A then rejected B's car on the ground that he had
already bought the car he wanted from C . B now sues A for breach of
contract . What decision?

2. After the murder of his brother, Buster Bullionhead published in
the newspapers an offer to pay $100 "for the arrest and conviction of the
person or persons who murdered my brother." Sherlock Hammer, an amateur
detective, read the ad and then wrote a letter to Bullionhead stating that
he considered an offer of such an amount an insult to the profession of
criminology. He concluded by saying, "No self-respecting citizen would
work for or claim any such trifling amount . " Hammer subsequently obtained
information which incriminated the killer of Bullionhead 's brother.
During the killer's trial Bullionhead published a withdrawal of his
offer in the same newspapers and for the same length of time as had been
utilized in making the offer. The killer was thereafter convicted of

the crime, and the conviction has become final. Hammer now sues Bullionhead
for the reward. What decision?

End of Quiz

MIDSEMESTER QUIZ IN CONTRACTS A (Law 301 )
December 11, 1959 Professor Davis

TIME ALLOWED : Sixty Minutes

1. X orally offered to lease his farm to Y for two years at an annual
rental of $1200. Y replied, "It's a deal, but I hope you'll let me
have the place for $1100 a year." X answered: "I may do that. I'll
think it over and in the meantime I ' 11 have my lawyer draw up the lease
and he'll phone you when to come by his office and sign it." X sub-
sequently instructed his attorney to draft the lease at a rental of
$1200 a year. The lawyer, however, inadvertently typed in the rent as
$1100 a year. X then called at the lawyer's office and signed the lease
so drafted without reading it. Later the same day Y went to the lawyer's
office, read the lease carefully, and signed it. Several weeks later X
discovered that the lease called for an annual rental of $1100, and
thereupon brought suit for rescission and reformation of the lease so
as to substitute $1200 for $1100. What decision?

2. Oliver Owner and Bertram Broker signed a document which read as
follows :

Agreement . I, Oliver Owner, hereby give Bertram
Broker the exclusive sale of my house and lot on
Green Street for one month from date; commission 5
per cent when and if a sale is consummated, price
subject to my approval . In consideration of the
above, I, Bertram Broker, hereby accept the said
agency and agree to carry it out. Signed this
first day of November, 1959- Oliver Owner. Bertram
Broker .

One -half hour after the agreement had been signed, Hobart Homeless
appeared at Broker's office, told his wants, and, on being informed by
Broker of the availability of Owner's house, took Broker in his (Homeless')
car to see the property, which was in the possession of a tenant. Homeless
then made an offer of $20,000 for the property, which Broker communicated
to Owner about one hour after the above agreement had been signed. Owner
stated that he had himself meanwhile sold the house to another purchaser
for $25,000, and that the agency was terminated. Broker now consults you
for advice concerning his legal rights against Owner.

End of Puiz

PINAL EXAMINATION IN CONTRACTS A (Law 301)
First Semester 1959-1960 Professor Davis

TIME ALLOWED: THREE HOURS

1. Botwell operates a Large retail grocery store. U-Eata is a corporation selling
various brands of crackers and cookies at wholesale. Pressure is a traveling sales-
man working for U-Eata. Pressure called on Botwell and showed him the cookies and
crackers carried by U-Eata. A written agreement followed:

Botwell agrees to buy all of the graham crackers needed in his business
for the next six months from U-Eata at $6.00 per crate. Requirements
not to exceed 1000 crates during the six months. U-Eata hereby agrees
to sell all chocolate cookies which Botwell thinks necessary for his
trade; price 5 cents per pound, orders not to exceed 1000 pounds per
month -- contract to run for six months. No agent or representative of
the company, except agents at the home office in Chicago, has any power
to bind the U-Eata Corporation to any agreement. All contracts subject
to approval of the home office.

/s/ Botwell Grocery
/s/ U-Eata Corporation
December 1, 1959 by I. pressure

On December 15 Botwell received the following letter from Kookoo Kookies Korporation,
a manufacturer of chocolate cookies: "We have just today heard about your deal with
U-Eata, which is one of our outlets. If you will agree to buy all your requirements
of chocolate cookies from them for the next six months, we will pay you a bonus of
four cents for each pound of cookies you order." Botwell immediately wired Kookoo
Kookies: "Delighted to accept your offer." This wire was delivered in normal
course. Botwell heard nothing from U-Eata' s Chicago office for a month. On Janu-
ary 2, i960, he ordered 1000 pounds of Nabisco chocolate cookies. U-Eata wrote
back saying that they had no contract with Botwell because the agreement above had
never been accepted by the home office. Botwell purchased the cookies elsewhere
at a higher price.

What are Botwell' s rights against U-Eata if he proves that for five years he
had signed similar agreements with U-Eata and that at no time had U-Eata 's home
office notified him of approval of the agreements? What are Botwell' s rights
against Kookoo Kookies?

2. Nick Stone, apparently drowned, was pulled out of a lake by a professional
lifeguard. The latter fainted from exhaustion. Miss Creole Cribbet, a Girl Scout-
mistress, happened to be present and promptly applied artificial respiration to
Stone. After three hours of this, he regained consciousness. Several days later,
Stone gave Miss Cribbet a promissory note in the amount of $2000 in return for her
agreement to bring her Girl Scout troop out to Stone's small backyard and to clear
it of grass snakes, weeds, and insects. In the course of this project, Miss Cribbet
was bitten by a scorpion and almost died because of extreme allergy to insect venom.
Stone thereafter defaulted on the note. Does Miss Cribbet have an enforceable
claim against him? Explain.

3. In January 1959> the Justinian Law School, an incorporated private (profit-
making) institution in southern Illinois, mailed two hundred pamphlets to under-
graduate college deans and department heads all over the country. The pamphlets
contained this announcement:

A. For the first year's work in this Law School, we are now granting
an unlimited number of scholarships consisting of full tuition plus
a cash stipend of $2000. The applicant must qualify as follows:
(l) Prior to registration at this Law School he must have completed

Final Examination in Law 301, First Semester 1959-1960 Page 2

three years of undergraduate work in the liberal arts and sciences
at any accredited college or university in the United States and
must have achieved a cumulative grade average of A-minus for all
such work. (2) He must present an executed loyalty oath or affi-
davit in the form now prescribed by the National Education Act.
(3) He must appear at the Dean's Office for a personal interview.
B. Application forms are available upon request to the Dean's Office.

In March 1959> Bertha Boondoggle, a senior in the College of Liberal Arts and Sci-
ences at the University of Illinois, wrote the Dean of Justinian Law School as
follows: "I have read your brochure, which is posted on our bulletin board. This
is a splendid offer, and I accept it — on condition, of course, that my qualifica-
tions meet your requirements. Please send me an application form." In May 1959*
Bertha persuaded her uncle, Briskethead Boondoggle, to rewrite the latter' s will
so as to substitute a bequest of $10,000 to Justinian Law School for a prior bequest
of $10,000 to the University of Illinois. Uncle Briskethead died in July. In
September 1959* Bertha Boondoggle in person presented her scholarship application,
with transcript of undergraduate work and executed loyalty oath, to the Dean at
Justinian. The transcript showed a cumulative A-minus average for her first three
years of college, but only a B-plus average for all four years. The Dean rejected
her application, Bertha learning for the first time that late in May the Dean had
mailed to all the original addressees notices "cancelling and voiding" the January
pamphlet. Bertha now consults you on the question whether she has any enforceable
rights against Justinian Law School.

k. X desired to install for his farm dwelling lawn a sprinkler system using water
pumped from a nearby stream. Y recommended to X a system of smaj.1 ground- level
sprinkler heads, estimated the cost at $3000, and declined to make a firm bid for
the job because of special problems posed by sediment in the stream. On January
3 X wrote Y: "If you can get started expeditiously, go ahead and install the
sprinkler system we discussed. I can pay you cost plus 10$." Y received the letter
on January k at 10:00 a.m. On January k W came to X, said he had installed several
sprinkler "systems using large above-ground revolving sprinklers unaffected by
sediment, and offered to install such a system on X1 s property for $1700. X
replied: "I have already asked Y to put in my system. However, the job is yours
if I succeed in withdrawing from my deal with Y. I will write him now." W then
said: "I will go by Y's place on the way to town and will deliver your letter to
him." An itinerant seed salesman witnessed this conversation. X wrote Y: "I
have changed my mind. Please ignore my January 3 letter." W was handed this
letter at 2:00 p.m., tried without success to find Y, and then deposited the letter
in a post-office mail slot at 6:00 p.m. on January 4. Y did not receive it until
3:00 p.m. on January 5- However, Y met the itinerant salesman at a social gather-
ing the evening of January 4, and the salesman repeated to him the substance of
that afternoon's conversation between X and W. At 8:00 a.m. on January 5, Y came
"co X' s farm with a crew of workmen, equipped to and intending to install X's
pprinkler system. When half the pipe and other materials had been unloaded, X
observed Y and said to him: "Didn't you get my second letter? I don't want you
to do this work." Despite Y's insistence that he had received no letter cancelling
X's request, X refused to let Y go ahead with the work. As a result of the
ensuing controversy, X sought legal advice. Indicate, with your reasons, the
correct advice to X ooncerning his legal relations with Y.

End of Examination

FINAL EXAMINATION IN CONTRACTS A (Law 301)
Second Semester 1959-60 Professor Davis

PART I
TIME ALLOWED: ONE HOUR AND A HALF

1. Fred Facile was both a general insurance agent and a real estate
broker. Val Vendee wanted to buy a hotel building from X by paying the
purchase money in yearly installments over a 15-year period. Vendee
asked Facile to negotiate the purchase and promised him a $500 commission
if the deal could be made on the desired terms. Vendee also promised
Facile that the latter "could write all fire insurance on the building
for each year during the 15-year payment term." Facile replied, "Okay."
Facile then effected the purchase from X as Vendee wanted it, and the latter
paid Facile the $500 commission and the premium for the first year's

fire coverage. At the end of that year Vendee refused to renew the
insurance through Facile, who immediately filed a lawsuit to recover his
commission on the anticipated fire insurance premium for the second
year. While this action was pending the parties negotiated a settlement
whereby Facile voluntarily dismissed the suit and Vendee promised to
procure a $50,000 life insurance policy on himself through Facile 's
agency. Vendee's application for such a policy was rejected at the life
insurance company's home office because the medical examination disclosed
that Vendee had only one kidney. Facile now seeks your opinion regarding
his rights against Vendee.

2. The Heartburn Grocery Company placed a large jar of beans in its show
window, and through a widespread handbill distribution announced a
guessing contest concerning the number of beans in the jar. The hand-
bills stated, "The person guessing nearest the actual number in the jar will
be awarded $1,000 in groceries. No purchases necessary to enter." Inside
the store each contestant was supplied a form reading, "Enter your bean
guess and your name and address, neatly and legibly printed, on the
reverse of this form and drop it in the container at the back of the store . "
At the end of the contest an accurate count showed there were 7,^68 beans in
the jar. Tom Ptomaine, whose name was sloppily but legibly printed on his
entry form, had guessed 7,^67. ^en Burp, who, as it turned out, was unaware
of the handbills, had entered a proper form guessing 7,^69 beans. While
the store manager and other contest judges were deliberating, Felix Fuddy

(a wealthy uncle of Ben Burp ) approached the store manager and said,
"I hear by the grapevine that you have a close one in the bean contest.
My nephew Burp is a proud pauper who won't take help from me or anybody
else. If he should happen to win this contest — fair and square, you
understand — I'll pay $1,000 into the Heartburn Company's Employee
Pension Fund." Shortly thereafter, Burp was declared the winner.

Discuss the legal rights and duties of all parties involved in this
situation.

End of Part I

~ ■ I ■■■

FINAL EXAMINATION IN CONTRACTS B (LAW 302)
Second Semester 1958-1959 Professor Davis

TIME ALLOWED: THREE HOURS

1. A, a professional entertainer, entered into a contract with B, a producer of
theatrical attractions, for a singing engagement in a theater owned by B. The en-
gagement was to begin on January 1, 1959, and to continue for three months. A's
salary was to be $1,000 per week. A knew when he entered into the contract that

B had already assigned all the rights to the receipts of the show to Z and that
B's only means of paying A was a deposit in B's account in the First State Bank,
then in excess of the amount promised. On November 20, 1958, A became ill with
pneumonia, and B was advised by competent medical authority that A would not be
able to sing before April 1, 1959- Accordingly, and without notifying A, B hired
X, another singer, to fill A's place in the show. On December 20, 1958, B cancelled
the show because, on that date, a fire totally destroyed his theater. A made a
very rapid recovery from his illness, and was ready, willing, and able to start
the singing engagement on January 1, 1959- Naturally, B declined A's offer to
fulfill the contract. A thereupon got another singing engagement at $500 per week
for the first three months of 1959- He now sues B for breach of contract. In
his defense B sets out all of the above facts and, in addition, proves that
the First State Bank became insolvent on December 30, 1958, with the consequence
that B's deposit therein was completely wiped out. Decide the case.

2. Brotherhood X, a labor union, and the Acme Tool Company entered into a collective
bargaining contract to run from January 1, 1958, through December 31, 19^0. The
contract contained a number of wage and hour provisions, and agreements on working
conditions, grievances, and union security. Included was a "holiday clause" in
which the Company promised to pay all employees their regular hourly wages for
eight hours, but without work, on a number of specified holidays, among them

July h. Various commitments by the Brotherhood included a "no strike" clause where-
by the union agreed not to call or authorize a strike by union members for any
cause during the life of the contract. On Thursday, July 3, 1958, the Brotherhood
called a strike and its members left their jobs at noon on that day. The Company
immediately, on July 3, notified the Brotherhood in writing:

We consider your action a flagrant violation of our collective
bargaining contract, which continues in full force through
December 31> 19°0 • We stand on the contract and intend to hold
you fully responsible for any damages we may sustain as a result
of your breach.

On the following Sunday, July 6, the Brotherhood called off the strike. Its
members resumed their jobs on Monday morning and have continued to work regularly
thereafter. However, a dispute arose over the question whether the strikers were
entitled to full pay for July k. The Brotherhood concedes that the strike was a
breach of the "no strike" clause, and makes no claim for any other wages possibly
accruing while its members were out on strike .

(a) You are appointed by the Brotherhood and the Company to arbitrate the dispute,
pursuant to arbitration provisions in the collective bargaining contract. What
should you decide?

(b) Assume that the contract contains no arbitration provisions, the facts other-
wise being as stated above. Beaver, a non-union employee of the Acme Company on
July 3 and thereafter, declined to cross the Brotherhood's picket line in order to
resume his work after lunch on the afternoon of July 3 and again declined to do so

Final Examination in Contracts B (Law 302) Page 2

on Saturday, July 5 • Beaver can prove that on both occasions he was peaceably
advised by several picketers not to cross . He now sues Acme for full pay allegedly
due him for the afternoon of July 3> for all of July k, and for his usual working
hours on July 5- What decision?

3- T negligently injured V in an automobile accident. While V was undergoing
treatment for his injuries in Mercynary Hospital, an adjuster for I (T's liability
insurance company) offered V $5000 as settlement in full of T's liability. V agreed,
gave the adjuster a signed release, and received a memo in which I promised to
pay V $5000 by check within 30 days in full settlement of V's claim against T. The
adjuster had been authorized by I to make this settlement. / was discharged from
the hospital two days later, at which time the hospital demanded payment of his
stated bill ($1+000). Having no funds, V gave the hospital his own negotiable promis-
sory note for $U000, payable to the hospital's order in 30 days, and at the same
time, as security for the note, assigned to the hospital the memo he had received
from I's adjuster. The hospital at once assigned the memo end negotiated the note
to H, who took as a holder in due course of the note. A few days later V falsely
represented to I's adjuster that he had lost the settlement memo and needed another
in order to finance some new furniture. The adjuster issued to V another memo
identical to the first, and V assigned it to the Migraine Furniture Company to
secure a contemporaneous $5000 conditional sale contract for the purchase of furni-
ture. Migraine immediately notified I of the assignment. Later these additional
facts were discovered: (l) Because of a clerical error the hospital in its stated
bill had overcharged V in the amount of $1000. (2) T was a twenty-year-old
"hotrodder" who had been chsr^ed with manslaughter and was free on appearance
bond at the time V was injured. T's uncJe, representing that he was T, had fraudu-
lently obtained the insurance policy with I on T's car.

The following litigation has developed, the first parties named being the respective
plaintiffs. Decide each case:

(a) V v. I

(b) H v. V

(c) H v. I

(d) Migraine v. I

k. Daddyo Rumble (2^ years old and a senior at the University of Illinois College
of Law) ordered from Sullivan's Haberdashery a custom-made suit to be tailored from
a rare cloth called "Looperuna." Delivery was to be made in 30 days, at a price
to Rumble of $150. Two weeks later Rumble notified Sullivan that he would not
take the suit. Sullivan sued for damages, alleging the following items: (a) Labor:
$U0 . (b ) Five yards of rare Looperuna patterned for Rumble and now worthless :
$50- (c) Commission due Sullivan's salesman at 10$: $15> (d) Profit on sale:
$35- (e) Loss of advertising value: $10,000. Item (e) was explained by an alle-
gation that Looperuna was not known or worn in the community, that it could be ob-
tained only by purchasing a bolt of 5000 yards at $2 per yard, and that Sullivan
had undertaken the job in reliance on the popularity it expected to result from
Rumble's purchase --all of which was well known to Rumble. The defendant answered,
'admitting a breach of contract, but alleging that plaintiff was under a duty to
finish the suit and that damages should be limited to the difference between the
market price and contract price of the finished garment. Over defendant's objection,
the court permitted the introduction of evidence to establish each item of damage.
jEn regard to item (e), a salesman testifying for plaintiff said that when the risk
lad been explained to Rumble, the latter had replied, "I must have Looperuna or
lose my social standing."

iow should the trial court instruct the jury? Give reasons .

— -p TP..«-

-

NAME NO.

FINAL EXAMINATION IN CONTRACTS B (Law 302)
Summer Session 1959 Professor Stone

TIME: k HOURS

Part I

Please do not write anything but your name on the first page of your exami-
nation book; start writing your answers on page 3-

Begin each answer with a statement of your decision or your conclusions.
Discuss all points and issues involved, and give reasons fully but
succinctly. If you think that you must make assumptions as to law or
fact, state what they are. LARGE CREDIT WILL BE GIVEN FOR BREVITY,
CLARITY, COBERENT ORGANIZATION, AND GOOD ENGLISH PROSE.

1. C, a contractor, and 0, an owner, entered into a contract for building 30 houses
in a development which 0 was promoting. The contract, which was signed last Septem-
ber, provided that performance and payment were to be completed by June 1, 1959-

0 was to make payments in installments at certain stages of construction. The total
amount was $200,000.

By April 1, 1959, construction had been so delayed that both 0 and C estimated
that it could not be completed before the middle of July. 0 had made payments
totalling $135,000. After revising their estimate of the completion date, but with-
out any new agreement, C proceeded with the work, but 0 began to fall behind in his
payments. By May 15 he was $5,000 behind, by June 1, $10,000 behind, and by June
15, $12,000 behind with reference to the contract provisions for payments at various
stages of completion of the work. 0 was approaching insolvency, and on June l6 he
entered a contract with X whereby he assigned to X all his rights under the contract
with C, and X assumed all of his obligations. C was notified promptly of this
transaction. Two days later, C wrote both 0 and X that payments had been so far
delayed and uncertainty about the future had become so great that he would not con-
tinue to perform the contract.

Is C entitled to further payments? If so, from whom, and measured how? Why?

2. The Splendiferous Mining Company operates two mines: at the Boom Boom Mine,
uranium is extracted; at the Glitter Mine, gold.

a) The chief markets for uranium presently are military use and use as a fuel
in the generation of electric power and the propulsion of ships. A tiny amount is
used in medical research. Splendiferous executives are well aware that the military
market will diminish, since it apparently would not profit any country to stockpile
more bombs than it could deliver, or more than would, if delivered, destroy this
small planet. They are also aware of the conduct of research in thermo-nuclear
power, the object of which is the development of a process whereby electric power
could be generated at a very low cost by using the hydrogen in sea water as a fuel.
None of the latter research has yet gotten to first case, however; predictions
are current that no workable system will be developed before the year 2000. No
cranium can be sold for any purpose without a license from the Atomic Energy Com-
mission. Factors of foreign policy, economic philosophy, and even partisan politics
have been known to affect decisions of federal administrative agencies such as the
AEC.

The Boom Boom executives are considering leasing some valuable uranium deposits
on a royalty basis from an owner who demands minimum royalty payments on 60,000
tons of ore, whether actually mined or not, per year for ten years, and 30,000 tons
per year thereafter for twenty years. They are also considering the hiring of a

Final Examination in Contracts B, Law 302, Part I, Summer 1959 Page 2

mine manager who demands a 10-year contract at a very high salary. He is worth the
price if the mine can he operated to produce the foregoing tonnages, hut not if pro-
duction would he at much lower rates. It now appears that existing contracts with
the AEC, subject to termination at the AEC s option, and the predicted demand of
power installations planned or now under construction here and abroad, will furnish
a sufficient demand to allow Splendiferous successfully to market the quantities of
uranium concentrates that would be produced from the foregoing tonnages of ore.

The executives ask your advic.fi concerning the effect, if any, on such long-term
commitments of such fortuities as a break-through on hydrogen power, an embargo on
uranium exports, or a shut-down of the mine as a result of radiation hazards.
Advise them.

b) The Glitter Mine is located in Canada and is free to sell its production
anywhere in the free world. The price of gold in free world markets is determined
by the price paid by the U.S. Treasury, now approximately $35 per ounce. Some
monetary experts believe that the U.S. will soon be forced to increase the price
of gold - i.e., devalue its currency; others disagree violently. If the price were
to be increased, Glitter's profits from sale at the higher price would go up pre-
cipitously.

(1) Some current contracts call for future deliveries to customers at
$35 per ounce. Will Glitter have to continue to deliver at that price if the U.S.
Treasury should increase the price to $1+0 per ounce? to $70? to $105?

(2) Other contracts call for payment of the market price in Toronto.
In the event of devaluation, will the old or the new price be due on gold which
has been mined, refined, and poured into bars which have in turn been loaded onto
armored trucks hired by a customer to carry the bars to the latter* s depositary?
Why?

(3) A substantial amount of Glitter's production is cast in bars and
sold to Canadian banks, which in turn sell depositary receipts to U.S. citizens. The
Dwner of such a receipt thus hedges against devaluation of the U.S. dollar.
Present law prohibits the possession of gold, except for jewelry, dental or
comparable use, in the United States, but it is legal for U.S. citizens to buy it
and keep it in other countries. Their doing so creates a strain on the U.S.
dollar, however, and some fear that the Congress or the Treasury may require U.S.
citizens to surrender to the Treasury all depositary receipts. If it does so,

the price of gold bars will drop.

Will the banks who have ordered gold bars from the Glitter Mine
be required to take and pay for them if the U.S. government should suddenly
iestroy the market for them by making it illegal for U.S. citizens to buy or
own depositary receipts?

(U) Some of the bars sold to the Last Royal Bank of Montebec have in
turn been sold to a ring of smugglers who deliver them at enhanced prices to
aoarders in France, Egypt, India, and other countries where it is illegal to import
sr possess gold. Must Glitter, upon discovery of this fact, continue to make
leliveries under its contract with Last Royal?

■

•

FINAL EXAMINATION IN CONTRACTS B (LAW 3O2)
Second Semester 1959-60 Professor Davis

TIME ALLOWED: THREE HOURS

1. On April 1, i960, S, a supplier, entered into a written contract with the Ajax
Truck Co. to supply the latter with a specified number of metal castings for use
in trucks to be made by Ajax. Plans and specifications for the castings were
included in the contract. June 15, i960, was fixed as delivery date for the castings
In full payment, Ajax agreed to convey to S on or before June 1, i960, a described
plot of land owned by Ajax. On April 3, i960, S made a written contract with M, a
manufacturer, whereby M agreed to manufacture at an agreed cash price and to deliver
to Ajax on June 15, i960, the castings required by S's contract with Ajax. M.
experienced extreme difficulty in locating certain raw materials necessary in the
manufacture of the castings. M finally located these materials in the hands of Z,
who demanded such a high price for them that if M purchased them from Z he would
suffer a substantial loss on the contract with S. On May 26, i960, M notified S
that because of the current raw materials situation he would be unable to make
castings in time for June 15 delivery, or at any other time within the foreseeable
future. On May 27, i960, S wired Ajax as follows:

Sub -contract with M for castings has collapsed.
No other sub -contractor in sight. Am at a loss
to know how to proceed.

Ajax Truck Co. consults you today concerning its legal rights and duties in light
of these facts. What advice would you give?

2. On December 30, 1959, X sent Y a telegram reading: "Our sales manager died today.
I want you to take his position and start work January 2. Salary $2^,000 per year."
On receipt of this telegram Y called X by long distance telephone and said: "I am
interested in your offer. Is any incentive arrangement in prospect?" X replied:
"For many years I have on January 2 paid my sales manager a bonus, three percent of
the amount by which my sales during the preceding twelve months exceeded those of
the year before. I would expect to do the same for you." Y then said: "Let me
think about it overnight." The next morning, December 31, 1959, Y wired X: "Re
your telegram and our telephone conversation, I accept." On January 2, i960, Y
arrived at X's office and assumed his duties as sales manager. Y proved to be
incapable in X's estimation (but not in Y's) of performing satisfactorily the
planning and supervisory functions of his position. On February 1, 196o,X discharged
Y. Y was paid nothing. Assume that Y consulted you on February 2. Indicate with
your reasons the rights, if any, of Y against X.

3. C, a contractor, and 0, an owner, entered into a contract for building thirty
houses in a development which 0 was promoting. The contract, which was signed last
September, provided that performance and payment were to be completed by May 1,
i960. 0 was to make installment payments at specified stages of construction. The
contract price was $200,000. By March 1, i960, construction had been so delayed
that both 0 and C estimated that it could not be completed before the middle of June.
0 had made pyaments totalling $135,000. After revising their estimate of the
completion date, but without any new agreement, C proceeded with the work but 0
began to fall behind in his payments. By April 15 he was $5,000 behind, by May 1,
$10,000 behind, and by May 15, $12,000 behind with reference to the contract's
progress payment terms. 0 was approaching insolvency; and on May l6 he made a
written agreement with X whereby he assigned to X all his rights under the contract
with C, and X assumed all of 0's obligations. C was notified promptly of this
transaction. Two days later, C wrote both 0 and X that payments had been so far

FINAL EXAMINATION IN CONTRACTS B (LAW 302) page 2

delayed and uncertainty about the future had become so great that he would not
continue to perform the contract. Is C now entitled to further payments? If so,
from whom, and measured how?

h. B, a theatrical producer, and C, a designer, signed a document reading:

C will design the costumes, scenery, and backdrops for B's
forthcoming stage production "Moscow Rock 'n Roll." B will
pay C $1,000 plus kfy of the net profits of the production
before taxes, the percentage to be paid monthly. C will get
credit for design in all advertising and programs, C's name
to be in type half the size of the star's name.

As C knew, X for several years had been B's principal financial backer and was
expected to supply the funds needed to produce "Moscow Rock 'n Roll." C also knew
that Olga Minsk had been signed to star in the show. Two days after the above
agreement was signed, X and Olga were killed in a widely publicized common dis-
aster. C completed the promised designs, et cetera, expending 150 hours on the work,
and tendered them to B. B rejected the tender. He informed C that he had made a
strenuous but unsuccessful effort to raiee the funds needed to produce the play,
and would therefore be unable to produce it. Shortly thereafter B informed his
attorney that just before execution of the document set out above, he had said to
C: "If for any reason this play does not open, I will pay you only $5.00 per hour
for the time you have spent on design for it, up to a limit of $500"; that C had
replied, "I understand"; that C now demands payment according to the terms of the
document. Indicate with your reasons whether B is under a duty to pay C $1,000 or
any other amount.

End of Examination

NAME NO.

FINAL EXAMINATION IN CONTRACTS B (Law 302)
Summer Session i960 Professor Stone

TIME: k HOURS

PART I

Start writing the answers to the questions in Part I on page 3 of your
examination book. Do not write anything but your name on the first page.

Analyze each question and plan your answer before you write. Begin each
answer with a statement of your decision or your conclusions. Discuss
all points and issues involved, and give reasons fully but succinctly. If
you think that you must make assumptions as to law or fact, state what they
are. LARGE CREDIT WILL BE GIVEN FOR BREVITY, CLARITY, COHERENT ORGANIZATION,
and GOOD ENGLISH PROSE.

1. (Suggested time: 25 minutes) The Hi Building Corporation leased part of the

ground floor of its building to Tom Tenant. The
lease prohibited Tenant from using the premises
for the sale of soft drinks. The reason for this prohibition was that Hi had given
another occupant of the building the exclusive right to sell soft drinks in the
building. Tenant agreed in the lease to reimburse Hi for any damages that might be
legally assessed against it as a result of any breach of any of Tenant's covenants.
Also, the lease provided that for any month during which Tenant committed a con-
tinuing violation of any covenant relating to his use of the premises, he would pay
as rent 25$ more than the sum provided in the lease.

Tenant installed a soda fountain, and has sold soft drinks for the past three
months. He tells you, his lawyer, that he did so only after the tenant with the
exclusive right to sell soft drinks began to sell cigarettes, and that the land-
lord's representative had assured him at the time the lease was signed that no other
tenant had the right to sell tobacco products.

Hi has brought an action against Tenant for additional rent for the past
three months and has also requested an injunction against further sales of soft
drinks by Tenant. What plausible defenses can you offer on Tenant's behalf?
What is the likelihood of success for each defense?

2. (Suggested time: 35 minutes) The Fixit Furniture Company is a family corpora-

tion, all of the stock being owned in equal
shares by Al Fixit and his two sons, Bill and
Charlie. In order to finance a plant expansion, the Company borrowed $250,000
from Bruno Bucks. As a condition of making the loan, Bucks demanded a provision
that he could gain a controlling interest in the corporation under certain circum-
stances, the stock to be transferred to his son Peter. The loan agreement \ras
signed by the three Fixits as well as by the Company and by Bruno Bucks. It pro-
vided, "... each of the subscribing stockholders agrees to transfer 51 VeT cent
of the shares he now owns to Peter Bucks on demand by Bruno Bucks. In that event
the obligation of the Company to Bucks shall be reduced by the fair value of the
shares so transferred. Bucks may make such demand at any time he deems the
financial position of the Company insecure as it is reflected in the books of the
Company."

Some time later, Al Fixit died, leaving his shares in equal portions to his
two sons and their sister, Dolly. Each brother purchased half of Dolly's shares.
Their purchase agreement with her provided that "... purchasers assume all ob-
ligations connected with ownership of these shares. They will be held subject to
demand by Bruno Bucks in satisfaction of his claim."

■ ■

Final Examination in Contracts B, Lav 302, Summer i960, Part I Page 2

Bucks subsequently gave notice that he deemed the financial position of the
Company insecure, though in fact its prospects had never been rosier. He demanded
that 51 per cent of all of the shares owned by Bill and Charlie be transferred to
him. (He had fallen out with Peter.) On being refused, he sued for specific per-
formance of their agreement.

What issues of substantive law are presented by this lawsuit and how should
they be resolved?

3- (Suggested time: 60 minutes) Madame Diva, a famous foreign singer, contracted

with Best Productions, Inc., to present concerts
in the Chicago Music Hall on three successive

evenings in August. As compensation, she was to receive one-half of the box-office

receipts for these performances. Best was to provide the hall, the accompanist,

and the publicity.

State and explain the legal consequences of the following facts and events.
Each numbered paragraph represents a separate contingency.

(1) Because of a large number of cases of poliomyelitis, the City, by a valid
exercise of its police power, closed all theaters in Chicago for a period
including the dates of the scheduled performances.

(2) During rehearsal on the afternoon before the first performance, Madame Diva
flew into a rage because the accompanist played a certain passage too loudly.
She slapped his face, whereupon he walked out. It was too late to arrange
for another accompanist for the first concert, as a result of which it had to
be cancelled, and the ticket money refunded.

(3) After giving the concerts, Madame Diva was arrested by immigration authorities,
charged with violation of the terms of her visa, and held for deportation.

She was then released on bail pending a hearing on the charges. She hired a
Chicago lawyer to assist her and promised to pay him $3,000 if he could make
it possible for her to fulfil scheduled engagements over the next year; other-
wise he was to receive nothing. The attorney went to Washington, where, in
a number of interviews with members of Congress, he convinced them that this
country' s cultural level would be uplifted by the presence of and performances
by a singer of the caliber of Madame Diva. The Congressmen then sponsored
a private bill to allow Madame Diva to stay and work in this country as a
non-quota immigrant, the dispensation to be retroactive to the date of her
original entry. The bill passed Congress and was signed by the President.
Madame Diva refused to pay the lawyer.

(U) Before they signed their contract, Best informed Madame Diva that its lease
with the owners of the Chicago Music Hall required Best to present at least
three performances each week, and that Best expected to present no other per-
formances during the week of Madame Diva's scheduled concerts. The contract
contained no reference to Best's lease. On the first day of the week in
question, Madame Diva unjustifiably repudiated the contract. Best was unable
to arrange for other performances that week, and the lessor thereupon ter-
minated Best's lease because of that breach. Best sues Madame Diva for one-
half the ticket money refunded, plus $25,000, the estimated value of its
lost leasehold.

Page 2

FINAL EXAMINATION IN CORPORATIONS (LAW 32*0
Second Semester I958-I959 Professor Frampton

PART II - Essay Questions

1. Cap, Inc., is an Illinois corporation engaged in the manufacture of caps. Of its
15,000 authorized and 10,000 issued common shares, 7,^50 have always been held by Dan
Dart, president of the company, 100 by Paul Pry, and the remainder by others. Dart,
his wife, and his 22-year-old son, Dow, are the three directors. For many years no
formal directors' meetings have been held and no shareholders* meetings at all have
been requested or called. On December 31, 1958, Dart, whose salary had been $12,000
a year for the previous five years, decided, in view of his and the company' s per-
formances, to increase his benefits. After taking the matter over with his wife, he
notified all shareholders on March 1, 1959, that his salary for the calendar year
1959 had been raised to $2U,000, that he had taken $2,000 as a cash bonus for ser-
vices "above and beyond the call of duty" for 1958, and that he was taking a stock
option to purchase 5,000 shares of Cap, Inc., at any time prior to his retirement for
$5 a share. Paul Pry, who is almost impecunious, consults you on March 5, 1959,
about what he could do in this situation. Advi6e him, discussing the merits of and
defenses to any claims he may have and to any action he could take.

2. Art Able Is president of Werl, Inc., a corporation engaged in the manufacture of
laundry machinery in Werlburg. Ben Bar, a retired millionaire, is a friend of Able.
These two believe, on the basis of information known to Bar and told by him to Able,
and on their estimate of the economic future of the Werlburg area, that the land on
which the Werl general office is located, if put together with surrounding contiguous
properties, will probably be worth, in about fifteen years, four times its present
tnown and established market value. Each owns outright, or controlled through their
families and close friends at the annual meeting held about two weeks ago, 22,500 of
the 100,000 authorized, issued, and outstanding shares of Werl, the book and market
/alue of which on the Midwest Stock Exchange, where it is traded daily, is $10 a
share. Able is one of the seven directors elected at the annual meeting. Bar is
aot a director. Their plan is to get Werl, Inc., to sell its land and buildings to

1 new company, Abar, Inc., which would be organized and owned by them and which would
then formulate and offer Werl a long-term lease-back of these properties. Thereafter
Ybar would acquire the contiguous properties, which Able has assured Bar that Werl
:ould not afford to do. List the legal steps that will have to be taken to effect
shese measures, indicating, where a vote may be required, the proportion of the vote
leeded; and, as counsel for Able and Bar, indicate by what different means they could
iccomplish their aims, pointing out the possible obstacles and liabilities which will
lave to be overcome or minimized with respect to each of the means employed.

5. Ben Bran, who devoted virtually all of his time during the year 1958 to the idea
md working model of a three-dimensional amateur still color camera, caused an Illi-
lois corporation, Clik, Inc., to be duly formed on December 2, 1958, to exploit the
tamera. He persuaded ten others to invest a total of $100,000 under an arrangement
thereby they received 5,000 of the 15,000 authorized no-par common shares and Bran
'eceived 5,°01 shares in exchange for the camera model, idea, and patent application
'ights, which were valued on the books at one dollar. Bran and two of the investors
rere duly elected directors and Bran was chosen president. On January 2, 1959, Bran,
rho regarded the margin of his control as slightly precarious, acquired an addi-
tional 1,500 shares by persuading the board to issue him 500 shares and to sell him
liOO treasury shares for $15 a share in cash, and by purchasing, on the same day, 500
ihares in a private transaction for $17-50 a share. On February 2 the market price
if the shares was $30 a share, and Bran sold out his entire holdings for a flat
.200,000. He remained, however, as director and president. By May 2 Clik shares,
tartly on news of Bran's sale, had sagged to $10 a share. Disturbed by reports that
actions against him are threatened by various angry present or former shareholders,
ie asks you on what possible theories and for what damages or relief they might pro-

eed against him and with what probability of success. Write a brief memorandum

dvising him.

NAME NO.

FINAL EXAMINATION IN CREDITORS' RIGHTS (Law 3hk)
Summer Session 1959 TOTAL TIME: 3 HOURS Professor Looper

PART I
(Suggested Time: One Hour)

This part consists of 70 "objective-type" questions. Answers should
he indicated on the question sheets, which should he turned in with
the examination booklet containing your answers to Part II.

Assume that A, B, and C are general partners on an equal basis and that all
have joined in a bankruptcy petition in behalf of themselves and their part-
nership; that the partnership assets are worth $10,000 and the partnership
debts equal $15,000; that the individual estates of A, B, and C are respective-

ly: A

B
C

$25,000

10,000

5,000

and that the individual debts of A, B, and C are respectively

15,000
20,000
10,000

1. The bankruptcy filing fees should total $

2. The partnership creditors should receive $

3. A* s creditors should receive $
h. B' s creditors should receive $

5. C's creditors should receive $

Assume that X Corp. leased premises from A under a 10-year lease, beginning
January 1, 1950, for $12,000 annual rental, payable monthly. Rent was paid
through December 31, 1953. X Corp. filed a petition on March 1, 1951*-. Its
receiver and then its trustee remained in possession of the preraiees until
May 1, 195^> when the trustee rejected the lease. The reasonable' rental value of
the premises was then $500 monthly.

6. How much should be allowed for accrued rent prior to bankruptcy? $

7. How much should be allowed for the use and occupation of the premises by

the receiver and trustee as a first -priority expense of administration? $

8. How much should be allowed on the claim for future rent? $

9. Assuming that the lease was only for five years beginning January 1, 1950>
how much should be allowed on the claim for future rent? i

The following events in an ordinary involuntary bankruptcy are listed out
of chronological order. Renumber them (l through 16) according to correct
sequence:

Final Examination in Creditors' Rights (Law 3^*0, Summer Session 1959 Page 2

10. Discharge

11. Adjudication

12. Trustee's final accounting

13- Jury trial of contested issues of insolvency and commission of act of

bankruptcy

lk. Filing of verified answer

15. Appointment of receiver

l6. Filing of involuntary petition in bankruptcy

17. Deadline for filing of proofs of claim

18. Closing of estate

19. Liquidation of unliquidated or contingent claims and evaluation of security

held by claimants for purposes of final allowance

20. Issue of subpoena addressed to alleged bankrupt

21. Election of trustee(s)

22. Opening of first meeting of creditors

23. First meeting examination of bankrupt

2k. Filing of schedule of property, list of creditors, etc.

25. Allowance or disallowance of claims for voting purposes

True -False
(Circle the correct answer)

The following may file voluntary bankruptcy petitions:
T F 26. Life insurance company
T F 27. Federal savings and loan association

T F 28. Stock corporation engaged in the gas and electric business
T F 29. Farm owner whose principal income is derived from non-farm investments
T F 30. Workman earning $2,000 wages per year

The following constitute "acts of bankruptcy":

T F 31« Concealment of one' s property with intent to hinder, delay or defraud
creditors

T F 32. Transfer, while insolvent, of portion of one's property to secure
contemporaneous advance of funds

Page 2

Final Examination in Creditors' Rights (Law 344), Summer Session 1959 Page 3

T F 33* Transfer, while insolvent, of portion of one's property to creditor on
account of antecedent debt where such creditor had no knowledge of
insolvency

T F 34. Subjecting one's property, while insolvent, to a mortgage lien to secure
a contemporaneous loan, and permitting such lien to continue for more
than thirty days

T F 35 • Making, while solvent, a general assignment for benefit of one's creditors

T F 36. Appointment of receiver to take charge of a parcel of one's extensive
land holdings while one is insolvent

T F 37. Admission in writing by one, while solvent, of his inability to pay his
debts and his willingness to be adjudged a bankrupt

The following claims (existing as of the time of filing of the bank-
ruptcy petition) are provable:

T F 38. Tort claim for technical conversion not reduced to judgment

T F 39* Judgment for wilful conversion

T F 40. Qua si -contractual claim for conversion

T F 4l. Claim for anticipatory breach of executory contract

T F 42. Claim for negligent performance of contractual duty neither reduced to
judgment nor the subject of a pending action

The following claims (existing as of the time of the filing of the
bankruptcy petition) are dischargeable in bankruptcy:

T F 43. Sums due the Federal Government by the bankrupt for last year's income
tax

T F 44. $5,000 due a former wife as back alimony

T F 45. Claim for assault and battery reduced to judgment

T F 46. Claim for assault and battery not reduced to judgment

T F 47. $5,000 due an officer of a bankrupt corporation for back salary

T F 48. Claim for negligence reduced to judgment

T F U9. Claim for negligence not reduced to judgment but the subject of an
action pending at the time of the filing of the bankruptcy petition

T F 50. Claim for negligence neither reduced to judgment nor the subject of a
pending action

T F 5±. Unscheduled debts where the creditor had no notice or knowledge of the
bankruptcy proceedings

Page 3

Final Examination in Creditors' Rights (Law 3^*0, Summer Session 1959 Page k

T F 52. Unscheduled debts where the creditor learned of the bankruptcy proceedings
ten months after the date first set for the meeting of creditors

T F 53 • Unscheduled debts where the creditor learned of the bankruptcy proceedings
five months after the date first set for the meeting of creditors

*■*■*

T F 5h. On January 5> 1952, B filed a petition in bankruptcy, receiving a discharge
on April 3, 1952. On February 1, 1958, B again filed a petition in bank-
ruptcy. B may not receive a discharge in the second proceeding.

T F 55- The bankruptcy of a corporation releases its stockholders, as such, from
any liability under state law.

T F 56. Where a petition is filed in behalf of a partnership by less than all of
the general partners, the petition must allege that the partnership is
insolvent.

T F 57. In a civil contempt proceeding, upon certification by a referee, the
burden of proof is proof beyond a reasonable doubt.

T F 58* Chapter X of the Bankruptcy Act deals with arrangements.

T F 59- In determining the existence of a preference, the "greater percentage"
requirement relates only to the final effect upon liquidation.

T F 60. A transfer of property of the bankrupt to a bona fide purchaser for a fair
equivalent value, made within the interval between petition and adjudica-
tion, may be good as against the trustee.

T F 6l. The trustee in bankruptcy brings a bill in equity before the referee to

set aside an alleged fraudulent chattel mortgage under which the mortgagee
had obtained possession of the property. If the mortgagee makes timely
objection, the referee has no jurisdiction to set aside the mortgage.

T F 62. A homestead acquired after the creation of a debt may generally be asserted
as an exemption, even against the levy of the antecedent creditor.

T F 63. Most courts hold that creditors of a fraudulent transferor are subordinated
to intervening lien credi tors of the fraudulent transferee .

T F 6k. Creditors of a factor are uniformly held to have no right as against the
consignor to levy on the consigned goods.

T F 65. In Illinois a levying creditor of a conditional vendee will normally pre-
vail over a conditional vendor whose conditional sales contract is un-
recorded, even though the creditor cannot show that he extended credit
in reliance on reputed ownership.

T F 66. In Illinois the return of an execution nulla bona is a prerequisite to
maintenance of a creditor's bill by a judgment creditor.

T F 67. Under the Uniform Fraudulent Conveyance Act, the holder of a promissory
note may not, before dishonor of the note by the maker, attack as
fraudulent a conveyance by an accommodation endorser.

Page k

.

Final Examination in Creditors' Rights (Law 3^)> Summer Session 1959 Page 5

T F 68. In a non-bankruptcy liquidation, a federal tax lien will be subordinated
to the lien of a prior recorded mortgage.

T F 69. In Illinois the priority of execution liens is dependent upon the order
of delivery of the writs to the proper officers rather than the order
in which levy is made.

T F TO. In Illinois a delinquent judgment debtor is subject to imprisonment where
the judgment is obtained on a tort involving malice, but a contract judg-
ment debtor is generally immune to body execution unless he fraudulently
conceals assets or wilfully refuses to surrender same.

Page 5

FINAL EXAMINATION IN CRIMINAL LAW (Lav 309)

Second Semester I958-I959 Professor Bowman

TIME: 3 HOURS

I. Dolly Dawn obtained a preliminary decree of divorce from her first husband.
Under the law of the particular jurisdiction, the decree did not become final until
one year from the date it was granted and the divorced persons could not legally
marry again before the day following the final decree date. Dolly's decree became
final on August 7 , 1958, and under the law she could legally marry again on August
8, 1958. Acting in good faith and under the mistaken impression that the state
Office of Vital Statistics was responsible for interpreting and administering the
divorce law as to when decrees became final, in May 1958 she wrote to the Office of
Vital Statistics inquiring if she was correct in thinking that her decree would be-
come final on August 7 and that she could marry again on that date . The Office of
Vital Statistics had the ministerial responsibility for keeping records of all
marriages and divorces in the state but no legal responsibility for interpreting or
administering the marriage and divorce laws . However, a Supervisor in the Office
replied to Dolly's inquiry on the official letterhead of the Office of Vital
Statistics, advising her that she was correct in thinking that her decree would be-
come final on August J, 1958, and that she could marry again on that date. He
signed it: "Caleb M. Foreman, Supervisor of Divorce Records." Dolly married again
on August 7> 1958. She was indicted and tried for bigamy before the court without
a jury. Her defense before the court was based on three primary grounds:

(1) Mistake of fact

(2) Mistake of law

(3) No criminal intent

Discuss the validity of each ground of defense and how each should be decided. Why?

II. Roy Deegan and his wife, Julia, had been having difficulty for two years with
their neighbor, Thomas Jolley, over Julia's "rambling" rose bushes which "rambled"
over the dividing fence each spring and summer, entwining themselves in Jolley 's
honeysuckle hedge . Jolley repeatedly asked Roy and Julia to stake and guide the
"runners" in another direction. Julia insisted that they must be permitted to grow
"naturally," and that they did no harm to Jolley 's hedge. She often added, "That
old hedge is too high anyway." One day in May 1958 Roy was working around the
roses along the dividing fence when Jolley came out and began cutting off the rose
"runners" which were on his side of the fence and beginning to wrap themselves
around his honeysuckle. This he had a legal right to do. However, while he was so
cutting the offending "runners," Roy Deegan objected strenuously and said that
Jolley was not a "... decent neighbor for a man to have." Jolley used considerable
profanity toward Deegan and finally said, "Everybody knows that you and Julia are
nothing but selfish slobs and not fit to live with honest folks." At that point
Deegan said, "That does it! I'll teach you to talk about my wife that way." Dee-
gan walked rapidly to his house, which was located about 100 feet away. He went
inside the back door to the kitchen where Julia was busy preparing lunch. She
asked, "What's the matter?" Roy replied, "I'm so mad I can't see straight; that
jerk next door just called you a slob. I'm going to get my rifle and teach him a
lesson." While talking, Deegan was getting his high-powered rifle out of the
hallway closet just off the kitchen. He returned to the kitchen, sat down at the
kitchen table and began taking the rifle out of its cover. He then went back to
the closet and obtained a handful of steel- jacketed shells for the rifle. He re-
turned and sat down at the table and began loading the rifle . Julia placed a cup
of coffee on the table and said, "Here, drink some coffee. That guy is always
shooting off his mouth, Don't pay any attention to him." Deegan laid the rifle

on the tahle and began sipping the coffee, saying, "Well, maybe so, but I don't
like t.n he t.nl kerl f.o that wav. or to have him sav thirurs ahout. vnu. Resides, he's

Final Examination in Law 309, Second Semester 1958-1959 Fage 2

cutting off your roses." Julia said, "He is? Why that no-good pipsqueak; he de-
serves to he shot. Go out and do it right now. We'll show 'in." Roy went outside
with his rifle and walked toward Jolley, who was still working at the dividing fence.
When Deegan was about fifteen feet from Jolley, Deegan stopped, raised his rifle and
fired at Jolley. The bullet went through Jolley, seriously wounding him, and hit and
killed John Jolley, Thomas' twelve -year -old son who had joined Thomas and who was
standing directly behind Jolley. Deegan had not seen John and did not know he was
there .

While Jolley was still in serious condition in the hospital, Roy and Julia Deegan
were indicted, tried, and convicted of

(1) Conspiracy to kill Thomas Jolley

(2) Murder of John Jolley

Each prosecuted separate appeals urging reversal. On appeal, what decision on each?
Why?

III. David Washburn was an experienced crane lift operator with some twenty years of
experience. He was employed as such by a contractor constructing a Fine and Applied
Arts Building and Museum for the University of Illinois. The crane was in operation
on the south side of the building under construction, adjacent and in close proximity
to a busy university street which carried a constant flow of vehicular and pedestrian
traffic. After Washburn had been working on the job for some months and was thor-
oughly familiar with the working conditions and surroundings, he came to work one
morning slightly intoxicated but not noticeably so. His crane was located in the
space between the building under construction and the busy university street. During
the morning he was engaged in lifting heavy plumbing equipment from the bed of a
truck parked on the side of the university street to the unenclosed second floor of
the building. As he levered one hoist of heavy equipment from the truck bed, he
heard a noise behind him in the crane cab which indicated that the machinery was not
functioning properly. He turned to locate the noise so that he could report it. In
turning he levered the hoist in the opposite direction so that it swung out over the
university street, on which many law students were then hurrying to class. When he
turned back to position and noted that the hoist was over the street, he quickly
kicked at the emergency pedal to disengage the automatic controls and give him manual
control of the swinging hoist. In kicking at the emeTcncy pedal he missed it and
kicked the "rapid descent" lever. The heavy plumbing equipment then descended
rapidly, hitting and killing instantly a commerce stui?nt who was then riding his
bicycle along the university street. Washburn was indicted, tried, and convicted of
manslaughter. He appealed. What decision? Why?

IV. Robert Morrison was engaged in a complicated confidence game selling stock in a
"moose pasture" in Canada, which he alleged to be rich in uranium deposits. His head-
quarters were in Chicago, Illinois. Henry Tobrook was his attorney in Chicago and
was familiar with Morrison's illegal promotions. After Morrison bad been operating
for some months, collecting large sums of money from persons throughout the United
States, he learned that his operations were under investigation by a Congressional
committee. He asked Tobrook how he could avoid criminal responsibility. Tobrook
advised him to go to Canada. Morrison agreed to do so. Before leaving, Morrison
took $30,000 in cash from a safe in his home and asked Tobrook to go with him to the
bank. Tobrook did so and carried the satchel containing the money from Morrison's
home to the bank, where he gave it to the bank teller, who counted it. While the
teller was counting the money, Morrison told him to deposit it to Tobrook' s account
and Tobrook made out the deposit slip and handed it to the teller. Subsequently,
Tobrook was indicted, tried, and convicted of receiving stolen goods, the $30,000
deposited to his account in the bank. He appeals. What decision? Why?

FINAL EXAMINATION IN CRIMINAL LAW (Lav 309)
Second Semester 1959-1960 Professor Bowman

TIME: 5 Hours

I. Peter Case determined to kill his wife's lover. Pursuant to such design he pur-
chased a .38 caliber revolver and cartridges. On the day he had decided upon for the
deed, he loaded the revolver, stuck it inside his belt, buttoned his jacket over it,
and went to the restaurant and bar where he had been told his wife regularly had
been meeting Clarence DeMure. He arrived at the establishment about 1 p.m. and sat
at one end of the bar where he could watch two entrances, the barroom and adjoining
grill area. He began drinking whiskey and sodas, consuming, according to the bar-
tender's testimony, fifteen to twenty one-ounce drinks between 1 and 6 p.m. At
approximately 6 p.m. Peter's wife and Clarence entered the grill together and walked
on into the bar area and up to the bar before they saw Peter. Peter was ''quite
drunk" and had given no indication of seeing either his wife or Clarence until his
wife exclaimed, "Why, Peter, what in the world are you doing here?" Peter raised

his head and tried to get off the bar stool. As he did so his jacket, which had
become unbuttoned, opened and his wife screamed, "Look out, he's got a gun'." A
stranger sitting alongside Peter glanced downward, glimpsed the gun butt sticking
out of Peter's waistband, and threw both arms around Peter, holding Peter's elbows
and arms pinned tightly to his sides until the bartender summoned a police officer
from the grill area, who disarmed Peter and took him to the station. During the
whole period from the time Clarence and Peter's wife walked into the bar area until
after Peter had slept approximately six hours in a jail cell, no one heard Peter
say anything intelligible, although he seemed to be mumbling something most of the
time until the police put him on the cot in the cell. He was indicted and tried for
attempted murder. His attorney requested the court to instruct the jury that if
they found that

(1) Peter had abandoned his intent to kill by the time his wife and
Clarence entered the grill, or

(2) when Clarence and Peter's wife entered the grill, Peter was too
drunk to know what he was doing,

then, and in either event they, the jury, should find Peter not guilty. The court
refused to give the instruction. After verdict of guilty and sentence, Peter
appealed, alleging as error the trial court's refusal to give the instruction indi-
cated. What decision? Why?

II. Joseph Devaney was a third-year student at the University of Illinois in Urbana,
Illinois. His permanent heme was in New York City. In April 1959 he began thinking
about cheap transportation home at the end of the semester. According to his sub-
sequent statement, he " . . . had a vague notion that if I did not do so well on my
final exams and could obtain a good car I might just keep it and go on to Canada or
some place and not go heme or return to school, since I didn' t like college very
well anyway." During the latter part of April he contacted Professor Hadd of the
University, who was going to England for the summer and remaining there on a sab-
batical leave during the fall semester. He proposed to Frofessor Hadd that he,
Devaney, would drive Professor Hadd' s car to New York and there deliver it to the
steamship company for transshipment to England, and that Professor Hadd would then

be free to fly to New York, or even to London if he wanted to save time. Professor
Hadd thought it was a good idea and since time was important to him, he made arrange-
ments to fly to London and for the Atlas Steamship Company to receive his 1958
Buick from Devaney at Pier 90 in New York on June 10, and to ship it on to London.
With Devaney he agreed to pay all car expenses for the trip to New York but Devaney
would pay his own personal expenses for meals, lodging, etc.

Final Examination in Criminal Law (Law 309), Second Semester 1959-60 Page 2

According to plan, on June 9 Devaney obtained the car from Professor Hadd in
Urbana. Prior to departing for New York, however, he drove to the local Western
Union office and sent the following wire to the Atlas Steamship Company in New York:

"Car will be delivered to you at Pier 90 tomorrow according to previous
arrangements. Personal plans have been changed, hovever, and must spend
three months in Canada before going to England. Cancel previous shipping
instructions on automobile and deliver it to your pier warehouse in
Quebec where I will pick it up. (Signed) Professor E. H. Hadd, University
of Illinois."

Devaney then drove the car to New York and delivered it to the Atlas Steamship Com-
pany at Pier 90 on June 10, obtaining a receipt therefor from the company employee.
On June 25 Devaney appeared at the Company warehouse in Quebec, Canada, showed the
warehouse superintendent the receipt, stated that he was Professor Hadd, and obtained
the automobile. Four months later he was arrested in Newark, New Jersey, still in
possession of the car.

Devaney was extradited to Illinois in due course and held for the action of
the grand jury in the Circuit Court of Champaign County. Disregarding the procedural
problems as to place of the offense, trial, etc., discuss briefly for the grand jury
Devaney1 s possible guilt or innocence in regard to the following offenses:

1. Larceny

2. Embezzlement

3. Larceny by bailee

h. Obtaining property by false pretenses
5. Confidence game

Give reasons. Is it possible that he is guilty of no offense? Why?

III. Alexander Petrone and Harvey Jasper were jointly indicted in the Criminal
Court of Cook County, Illinois. The indictment contained two counts. Count 1
charged Petrone and Jasper with conspiracy to commit burglary, and Count 2 charged
them both with burglary. At Jasper's trial the evidence tended to show that Jasper
and Petrone planned to steal the day's receipts from the tavern where Jasper worked.
On the agreed night Jasper closed the tavern at 2 a.m., the regular time, but,
according to plan, left Petrone hidden inside. Jasper made it a point to greet the
parking lot attendant and call attention to the time, 2:05 a.m., and did the same
with the night clerk at his apartment hotel at 2:U0 a.m. At approximately 3:55 a-m.
Petrone, who had gathered up all the money Jasper had conveniently left for him,
$W38.92, set off the burglar alarm at the tavern and departed. When both were
arrested in Jasper's apartment about 10 a.m. the same morning, the money was found
in a coffee canister in the kitchen. Petrone confessed and testified for the state
at Jasper's trial. The state nolle prossed Count 1 as to Petrone, and after his
plea of guilty to Count 2, the court granted him probation. Jasper was convicted
on both counts. On Count 1 he was sentenced to one to three years in the penitenti-
ary, and on Count 2, to one to five years in the penitentiary, the sentences to be
served consecutively. On appeal from his conviction Jasper urged two grounds for

reversal:

(1) As a matter of law he could not be guilty of burglary
as charged in Count 2^.

(2) Assuming that he was properly convicted on both counts,
as a matter of law he could not be required to serve any
part of the sentence under either Count 1 or Count 2.

What decision on each of his contentions? Why?

PINAL EXAMEIrTIOH IN CBDCHAL PR0CI117I Law ::-

First Semester 1958-1959 Professor -:u-:..

EDS: 1 HOURS

I. On September 23, ±957, Charley Ray was indicted in the circuit ::ur: :: [
Island county, Illinois. The indictment ccr-eiiced of four counts. The first
charged burglary (unlawful entry) of a warehouse of the Mississippi Fuel Corpor-
ation with intent to steal its property- lie seicr.d count charged larceny of
$78.35 in money, the property of the Mississippi Fuel Corporation. Ehe fchi - i
court charged larceny cf a Sheaffer pen and deir: set of the value of Sc2.;I, the
property of John Morris. The fourth count charged arson of a 1 arc ouse Lbed
the same as the warehouse described in :c nt one] of the Mississippi Fuel Cirpcra-
tion. The place and time of all four offenses was alleged :: be t c city of Re .
Island on the evening of . t 10, 1957j between the hours of :.-: p.m. and
11:15 p.m.

A jury found Ray guilt as charged in :•: nts one and four." ani he vas
sentences to the penitentiary for a tern of one tc lit teen years, "r. June 1: ~'-z : ■
appearing pro se. Ray prose : bed a writ cf error in the Supreme ."" : irt of llliriiE.
alleging the following err'.

(1) The indictment was fatally defective because it was multiplicitous .

(2) The third court :t the indictment was fatally defective because :ne prop-
erty vas net suff i L tiy described.

(3) The trial court erred in overruling iefends t's motion 1 : suppress
certain evidence 'rich 'he police bad found _a defendant's home ani
seize! vithcut a sear en variant -

(h) In instructing the .try tne court iii net aaeccacily define 2nd it; -
tinguish tne offenses of burglary arc larcen;

(5) tne jury vas net polled.

No bill cf exceptions,, report of proceedings, or trans:ript vas f led in tine and

the clerk of the trial court certified tc the Supreme Court only tie common-law

reccri. laced u. the ::crt;n-lav recori only, what ruling on eacn :t the a::~ -
allegations of error: Hhyl

II. On January 18, I95S, Jonathan Spencer was arrested on a warrant of the United

States District Court for the Eastern listrict if Illinois at Danville for a %«iola-
tion of the federal narcotics act. After preliminary rearing before a commissioner,

he vas releasee, on tail pending action by the federal grand jury.

While Spencer vas free on bail, he vac arrested in Irtara, Illinois, and in-
iictei in the Champaign County circuit court fir larceny cf a motor vehicle. .n
March 19, 195- • re pleaded guilty tc the _atter iharge. Dn April 2 the circ
court of Champaign County found Spencer guilty m accordance with his plea a

entered judgment accordingly. On the same date, before sentence. Spencer requested
probation and the case vac continued for the purpose if investigation.

Cn April 5 , 195b, Spencei was indicted by tne federal grand jury fir violation
of the federal, narcotics act. and continue a on bail tuning trial. me -.

195c, he pleaded guilty to the federal indictment an guested probation, vhich

V£~ granted for a period of two years . He vas reles .... the -?:_

On June II, 1958, his request for probatim in the circuit court v —

County vas denied and he vas sentenced in accordance with t„e statute tc a peril

Final Examination in Criminal Procedure (Law 33U) , First Semester 1958-9 Page 2

of three to ten years in the penitentiary. On June 12 he was transferred to
the state penitentiary at Joliet and incarcerated therein to serve his sentence.

On June 15, 1958, Spencer's attorney went before the United States District
Court in Danville and secured his discharge from the penitentiary on a writ of
habeas corpus, on the ground that he was within the jurisdiction of that co^rt.

On December l6, 1958, Spencer filed a motion in the circuit court of Cham-
paign County to vacate its judgment of April 2 and for leave to withdraw his plea
of guilty on the following grounds :

(1) The court was without jurisdiction to enter the judgment.

(2) The plea of guilty was mistakenly entered because the State's Attorney
had promised Spencer that he would be granted probation on a plea of
guilty.

In the alternative, Spencer, in his motion, requested the court to:

(a) Suspend its sentence of June 11, set aside its denial of probation, and
grant Spencer's request for probation.

As State's Attorney for Champaign County, state all of the arguments you
would make in opposition to Spencer's motion. Give the reason for each argument.

III. Pursuant to lawful instructions from the Secretary of State, the Illinois
State Police, who have the arresting authority of any other law enforcement officers
in the state, set up a road block at University and Wright streets on Route krj, in
Champaign County, to stop all motor vehicles and inspect drivers ' licenses . They
were instructed to issue a summons for violation of the motor vehicle code to any
driver who did not have a valid license. While so engaged on a bright, sunny
afternoon in July 1958, Officers Stewart and Thompson stopped the automobile
owned and driven by Leroy Trees and asked to see his driver ' s license . While Trees
was fumbling for his wallet and license, Officer Stewart's casual gaze came to
rest on some familiar -looking pieces of paper in a box on the back seat. Stewart
said to Trees, "What are those pieces of paper?" After some hesitation Trees
replied, "Policy slips." Stewart said to Officer Thompson, "Get 'em." Tnompson
opened the back door, took the box containing the slips and handed it to Stewart.
After examining the slips Stewart said to Trees, "We're taking you to the station;
follow the squad car . " At Stewart ' s suggestion Thompson got into the front seat
beside Trees, who followed Stewart to the Champaign Police Station.

While Stewart and the Champaign Desk Sergeant were questioning Trees, Officer
Thompson conducted a further search of Trees' car, and, found, concealed under
the back seat, a quantity of narcotics. When he took the narcotics in to Officer
Stewart and the Desk Sergeant and told them where he had found them, Soe_..art said,
"That does it. We were going to book you for illegal possession of policy slips
but now you're really in trouble." Then to the Desk Sergeant, "Lock him up and book
him for illegal possession of narcotics."

Trees was subsequently indicted in Champaign County circuit court for illegal
possession of narcotics. Prior to trial Trees' attorney moved the court to suppress
the narcotics found by Thompson under the back seat of Trees' car.

(1) What decision on the motion to suppress? Why?
Assume that the motion is granted:

(2) May the State, by any method, obtain review of the ruling? Why?

•p.;'

FINAL EXAMINATION IN CRIMINAL PROCEDURE (Law 33*0
Summer Session 1959 Professor Bowman

TIME: 2 HOURS

I. Mazie Polk kidnaped three-year-old Bobby Akers for ransom in Chicago, Cook
County, Illinois, and took him to Waukegan, Lake County, Illinois, where she killed
him on May 20, 1958* She was captured in Waukegan on June 1, 1958* and returned

to Cook County. She was indicted by a Cook County grand jury on June 25, 1958.,
and by a Lake County grand jury on July 1, 1958. Both indictments were identical
and in two counts. The first count of each indictment was for kidnaping for ransom
(which carries a death penalty in Illinois), and the second count of each was for
murder. At her arraignment in the Criminal Court of Cook County on July 20, 1958 >
Mazie pleaded not guilty and stated that she was without counsel or funds to employ
one. The court assigned the Public Defender to represent her and set the trial for
September 15 . Bail was refused. Mazie refused to accept the Public Defender as
counsel and insisted that she desired "a good lawyer." At the trial, when asked if
she were represented by counsel, she replied, "No." Mr. Shott of the Public Defend-
er's Office was at the defense counsel table and said, "I represent the defendant,
Your Honor." Mazie said, "You do not. I want a good lawyer." The court said,
"Counsel has been assigned to you; the trial will proceed." Mazie refused to ask
or answer any questions for Mr. Shott, the court, or anyone else throughout the two-
day trial. The defense offered no evidence and Mr. Shott made a brief closing
argument devoted primarily to explaining to the jury and judge how handicapped he
was in trying to do a good job because of Mazie' s stubborn non-cooperation. The
jury's verdict was, "We, the jury, find the defendant guilty as charged in the
indictment." The court rendered judgment on the verdict and on October 14 sentenced
Mazie to 99 years imprisonment on Count One, and to life imprisonment on Count
Two, the sentences to run consecutively.

Immediately after sentencing by the Criminal Court of Cook County on October
Ik, Cook County officials delivered Mazie to the custody of Lake County officials.
On her arraignment in the Lake County circuit court on October 15, on the indictment
returned against her on July 1, 1958, Mazie was represented by the Lake County
Public Defender. He entered a plea in bar of trial on the ground of former jeopardy
and conviction. The State's Attorney of lake County argued that the defendant
had never been in jeopardy on the same charge because: (1) the trial and conviction
in Cook County was unconstitutional and void because the Criminal Court of Cook
County was without jurisdiction; (2) the verdict of the Cook County jury was
vague, indefinite, and insufficient to sustain any judgment so that even if the
Criminal Court of Cook County had jurisdiction a new trial there would be necessary,
and, therefore, defendant was subject to trial on the same charge; and (3) the
conduct of Mazie constituted separate offenses against Cook County and against Lake
County so that she might be prosecuted by both.

What ruling on each of the State's Attorney's contentions? Why?

II. Deposits in the First National Bank of Champaign, Illinois, were insured by
the Federal Deposit Insurance Corporation. By federal law, the robbery of such
hanks is a federal offense. Scott Townsend robbed the First National Bank of
Champaign during the afternoon of July 8, 1957. He escaped in a black 1956 Buick
sedan with approximately $2^,000 in a canvas bag. An all-points bulletin was broad-
cast, describing Townsend' s automobile, but the description of Townsend was stated
to be "uncertain." During the same afternoon, about forty-five minutes after the
bank was robbed, the Sheriff of Vermilion County, Illinois, an Illinois state
trooper, and a federal F.B.I, special agent were parked alongside highway 150 just
west of Danville, Illinois, when they observed a 1956 black Buick sedan pass,
heading eastward and containing one person, a middle-aged male driver. The car
appeared to be traveling well within the speed limit. The three officers were in a

Final Examination in Criminal Procedure, Law 33^, Summer Session 1959 Page 2

state police car which was distinctively marked as such. As the state trocper pulled
into the highway and came up behind the Buick, the Buick increased speed just as it
reached the edge of the Danville business district. In the dense business district
traffic, the Buick pulled away from the police car. By the time both cars had
cleared the business district, the Buick was several hundred yards ahead of the
police car and was traveling approximately 100 m.p.h. The chase continued east on
routes 150 and 136 across the state line and into Indiana. Several miles west of
Covington, Indiana, the police car forced the Buick off the road and as it came to
a stop, the driver, who was Townsend, jumped out and ran into a ravine. The three
officers ran after him. As they drew closer Townsend fired his pistol and killed
the F.B.I, agent. The state trooper and the sheriff returned the fire and when
Townsend threw out his gun and surrendered, they placed him under arrest. They
found an empty canvas bag behind a rock where Townsend had been hiding, but no
money. They searched Townsend and found $24,000 in bills stuffed in various pockets
and inside his shirt. Although Townsend asked to be taken into Covington, Indiana,
the officers refused to do so and took him back to Danville in the state police car,
the sheriff driving the Buick back to Danville. They held Townsend in the Vermilion
County jail until Champaign County officials came and returned him to the Champaign
County jail in Urbana. Subsequently Townsend was indicted

(1) In the Champaign County circuit court for robbery,

(2) In the Federal District Court for the Eastern District of Illinois (in

which Champaign County is located) at Danville for robbery of a
federally insured bank,

(3) In the Warren County, Indiana, circuit court for murder, and

(4) In the Federal District Court for the Western District of Indiana (in

which Warren County is located) at Crawfordsville, Indiana, for the
murder of a federal officer. (The killing of the F.B.I, agent occurred
in Warren County, Indiana . )

Indiana sought by the usual procedures to extradite Townsend frcm Illinois, and
the Governor of Illinois approved the request and directed the Champaign County
officers to release Townsend to the Indiana officers who would call for him.
Townsend petitioned for a writ of habeas corpus in the circuit court of Champaign
County and requested his release frcm custody on the following grounds:

(1) He had been illegally arrested.

(2) He was not a fugitive from Indiana and could not be returned there on

extradition for trial in either the state or federal court.

(3) The Champaign County circuit court had no jurisdiction of any offense

because the federal law protecting federally insured banks had pre-
empted the field of protection of such banks from robbery.
(k) The search and seizure of the money was illegal.

(5) The federal district court in Danville had no jurisdiction over him

because if he had committed any federal offense in regard to the bank,
it would be merged in the greater offense of murder of a federal officer,
since both alleged offenses arose out of the same comprehensive trans-
action.

Assuming that the above contentions are pertinent and proper to be raised by
Townsend in attempting to secure his liberty on a petition for a writ of habeas
corpus, what ruling on each of the above contentions? Why?

III. :~ Setter; '= r 1. 1>; , 7s.z-zc Trorr;™ v= = ::i ■■■■_ : -ei ::" =rmsd r-rccerv. ;.t-^n.ei-

- £ r-r- -,; -i£- 7i;~5:z re-.£_iei 7:1. a; :;.; =Ttcm=7 =.-i tr^t irve ; " ■. ^3 -. -_ :ti

FINAL EXAMINATION IN CRIMINAL PROCEDURE (Lav 33*0
First Semester 1959-60 Professor Bowman

TIME: 2 HOURS

I. A duly constituted grand jury of Madison County, Illinois, returned an indict-
ment in the circuit court of said county charging that Leonard Atwood, judge cf the
county court of said county, while then and there acting as such judge had the r:
and authority to admit to bail persons charged with criminal offenses and to forfeit
for payment into the general fund of the county the amount of bail bonds on which
bailed persons failed to appear as required. It was further charged that on divers
and sundry occasions Atwood had entered orders of forfeiture in specific cases
wherein the accused failed to appear, but subsequently, and in violation of his
duty and responsibility as judge of said court and in violation of the statutes in
such cases made and provided, he had entered or caused to be entered orders vacating
the orders of forfeiture so that such bail bonds were never forfeited and the
sureties thereon were never required to pay into the county fund the amount of the
bond, so that the people of the county were illegally deprived of such funds through
the unlawful acts of Judge Atwood. A second count of the indictment was substan-
tially to the same effect, charging that Judge Atwood conspired with certain persons
illegally to deprive the county of large sums of money which it was entitled to re-
ceive under the bail bond forfeiture laws of the state.

Judge Atwood filed a plea in the circuit court of Madison County, asserting
that he was a duly elected judge of the county court and as such immune from indict-
ment and trial for the offenses alleged to have been committed in his office as
judge; that the circuit court had no jurisdiction to try him so long as he was the
duly elected judge of the county court, and that the circuit court had no jurisdic-
tion of the subject matter set forth in the indictment since all matters set forth
therein related exclusively to official judicial acts of Atwood as judge of the
county court.

The state moved to strike the "plea" and to require the accused to plead guilty
or not guilty. After hearing, the circuit court denied the state's motion to
strike and sustained the judge's "plea." The judge was ordered discharged from
custody. By writ of error the state sought review of the trial court's order
sustaining the plea and ordering the judge discharged. The accused filed a motion
in the reviewing court to dismiss the writ of error.

(1) What ruling on the motion to dismiss the writ cf error? Why?

(2) Assume that the motion to dismiss the writ of error is granted.
there any other procedural methods by which the state may obtain review of
the trial court's action? Explain.

II. Irvin Waltham was indicted and charged with the murder of Robert Orr. At the
trial there was evidence to the effect that Waltham and Orr were frequent fishing
companions but often quarreled, sometimes engaging in furious fisticuffs . On the
day of Orr's death, according to evidence in the case, the defendant and Orr were
digging for fishworms about 7:00 a.m. A violent verbal quarrel ensued, terminated
by Waltham' s telling Orr, "From now on you stay away from me or I'll kill you en
sight." Waltham then returned to his home, which was about a quarter of a mile frrn.
Orr's home. According to Waltham 's testimony at the trial, about 9:30 a.m. he left
his house to go hunting down in the thicket along the river. He carried with him,
fully loaded, a sixteen shot automatic .22 calibre rifle. To get to the woods he
had to pass Orr's house, which sat back about fifteen feet from the road. Waltham

Final Examination in Lav/ 33^> First Semester 1959-60. Page 2.

testified that as he neared Orr's house Orr appeared in the doorway with a shotgun
which he aimed at Waltham saying, "You've been asking for this for a long time; now
you get it," and fired directly at Waltham, but missed. Waltham testified that he
then raised his .22 and fired seven times. He stated that as he fired Orr stepped
back inside the door and fired the shotgun again from inside the house, but missed
him. He said that he then turned and ran back up the road to his house where he
remained until the sheriff arrived and arrested him about 10:30- The sheriff's
testimony was to the effect that all seven of Waltham1 s shots went through the walls
or door of Orr's shack, that three of them hit Orr in the shoulder, chest, and
abdomen, causing his death, and that it appeared from the position of the shotgun
on the floor beside Orr, from the angle of the shotgun pellets through the door and
adjacent wall, and from the position of the door that the door had not been open at
any time during the exchange of shots .

At the close of the trial the defendant requested the court to instruct the
jury on self-defense, and when the court refused to instruct on self-defense, the
defendant requested an instruction on manslaughter, which the court gave. The jury
returned a verdict of guilty of manslaughter. The defendant made no post-trial
motion but took an appeal (writ of error in Illinois), alleging as grounds for
reversal :

(1) The court erred in refusing to instruct on self-defense.

(2) The court erred in instructing on manslaughter, as on the whole evidence
in the case, the offense was murder or justifiable homicide.

1. '.Jhat ruling on (l)? Why?

2. \Jhat ruling on (2)? Why?

3- Assuming that the reviewing court rules in favor of defendant on (l) or (2),
what disposition of the case should it make.' Why:

III. A warrant was duly issued for the arrest of Sam Thomas on a complaint for
embezzlement sworn to by Seth Wagner, District Manager of the Acme Distributing
Company, Chicago, Illinois . Sam was a collector for the company and instead of
turning in the day's collections as he was required to do on Friday evening, Septem-
ber k} 1959 (preceding Labor Day weekend), he had exchanged the day's collections
for a currency exchange draft to the company and had mailed it, together with his
resignation. The draft was not delivered until Tuesday, September 8, and the com-
plaint was signed and the warrant issued on Saturday, September 5- Immediately
after issuance of the warrant on Saturday morning, an all-points bulletin was broad-
cast over the Chicago and Illinois state police radio circuits notifying all depart-
ments of the issuance of the warrant and asking them to be on the lookout for Sam,
and to arrest and hold him for the Chicago Police Department. The bulletin also
described Sam's 1959 Oldsmobile .

Saturday afternoon, September 5, Sam was proceeding southward on Highway h^
south of Champaign, Illinois, when Illinois Highway Police Officer Estey came up
behind in a patrol car, identified Sam and his automobile as the subject of the all-
points bulletin he had previously received over his car radio, and had Sam pull off
the highway and stop. When Officer Estey looked at Sam's driver's license and veri-
fied the fact that he was the man for whom a warrant had been issued, he said,
"You're under arrest. Get out of the car." Sam got out of the car and Estey
searched him. Sam asked what it was all about. Estey informed him of the arrest

Final Examination in Law 33^> First Semester 19^9-00. Page 3-

warrant which had been issued in Chicago and the complaint charging him with
embezzlement. Sam denied vehemently that he had embezzled and said Estey had no
right to arrest and search him. Estey told him to open the car trunk and when Sam
refused, Estey took the keys and opened it. In the trunk were several cartons of
electronic parts which had been stolen by Sam from a warehouse in Kankakee, Illinois,

Sam was subsequently returned to Chicago where the charge of embezzlement
against him was dismissed on Tuesday, September 8, when the Acme Company received
the draft which Sam had mailed the preceding Friday evening. However, Sam was
delivered to the sheriff in Kankakee, Illinois, and subsequently indicted there for
burglary and grand larceny. Prior to trial Sam's attorney moved to suppress the
evidence of the electronic parts found by Officer Estey in the trunk of Sam's auto-
mobile. The motion was denied. Sam was convicted and sentenced to the peniten-
tiary. On review by writ of error he urged that the trial court erred in denying
his motion to suppress from evidence the electronic parts and the testimony of
Officer Estey in relation thereto. What ruling? Why?

FINAL EXAMINATION IN DECEDENTS ' ESTATES AND TRUSTS (Law 329)
First Semester 1958-1959 Professor Stoles

TIME: 3 Hours

INSTRUCTIONS

Note : Do noX| begin until the time indicated.

1. You are furnished a copy of the Illinois Probate Act for reference where
pertinent. The provisions cf the Act may or may not bear on the problems
presented. On occasion, reference is suggested to specific sections, but
this is not intended "so preclude your reference to other sections if you feel
the need. The copy of the Probate Act must be turned in with your examination.

2. Print your name on the front of each examination book* Please do not write
on the front of the booklet .

3- Before answering a question, take time to think. Read the questions care-
fully, analyze the facts, locate the issues, and organize your answer.

k. If you believe there is an error in any question or that additional fa^ts are
needed, do not waste time consulting the instructor. State the correction or
additional facts you think necessary and answer the question en that basis.
Give full reasons in all cases .

5. Each answer should show: a recognition of the problems presented by the facts,
the law applicable, your solution and the reasoning relied on by you to support
it. Analysis and reasoning, expressed clearly and concisely, are primarily
important. Make your answer complete, but do not volunteer immaterial infor-
mation. Demonstrate not merely your memory, but your ability to think. The
value of an answer does not depend so much upon the mere correctness of the
conclusion as upon the evidence it displays of the elements above-mentioned.

No penalty will be imposed for legibility.

6. Allocate your time so that each question is answered within the time allowed.

Final Examination in Law 329, First Semester 1958-59 Page 2.

FACTS

Lothario Bickerly, age l6, and Prudence White, age 15, were married in June,
1915« The marriage was moderately successful and a considerable amount of property
was accumulated by the couple, particularly after the death of their parents. In
1950, Prudence died from overwork while Lothario was on his bi-monthly trip to
Las Vegas, survived by Lothario and six children. In 1951* Lothario married Carmen
Prolifera, a hardworking girl whom he had met at a night club in Vegas where she
was employed as a hat check. In 1956, after five happy years of marriage and six
children, including one set of 'wins, Mrs. Bickerly discovered that Mr. Bickerly
was having an affair with a young lady in Calumet City. This discovery led to
considerable family differences .

Early in 1957 Mr. Bickerly transferred assets which were in his own name to the
Peoria Bank and Trust Co., in trust. These assets were 1000 shares in Atlas Corp.,
a Delaware corporation, and a dairy farm which he had inherited from his father-in-
law White. The Atlas stock was worth $200 per share and the farm was valued at
$300,000. By the terms of the trust, Mr. Bickerly was to be paid the income for
life, at his death the income was to be paid to his six eldest children, who were
named, for their lives and at their death the property was to be distributed to
their issue. Bickerly reserved the power to alter, amend, or revoke the trust and
to appoint the principal by will to anyone, including his estate as he saw fit.

At about the same time in 1957, Mr. Bickerly withdrew $100,000 from joint bank
accounts held in the name of himself and his wife Carmen, and deposited this money
in the Springfield First National Bank in an account entitled "Lothario Bickerly,
trustee for Allen Bickerly".

Mr. Bickerly executed a will on Sept. 1, 1957, leaving his wife, Cauien, his
residence, valued at $50,000, and a personal bequest of $10,000. His eldest grand-
son, Franklin D. R. Bickerly was bequeathed $30,000 "to start him in life'1.
Whiteacre, valued at $200,000, was devised to his second eldest son, Biackington
White Bickerly. The balance of his estate was given to the Champaign Bank and
Trust Co. in trust to pay the income in equal shares to all of his children during
their lives, the issue of a deceased child to take the deceased parent's share,
and at the death of the last surviving child of the testator to distribute the
principal to the testator's then living issue, per stirpes, and if none to the
Chicago Home for Wayward Girls. He expressly refrained from exercising any powers
of appointment.

When Mrs . Carmen Bickerly learned of the will, she filed suit for divorce on
Jan 2, 1958, alleging adequate grounds and was assured by her attorney that the
evidence available was more than adequate under almost any circumstances to obtain
a decree in her favor .

In February, 1958, Mr. Bickerly 's rich uncle, Don Juan Bickerly, died leaving
sixteen children and a will which in addition to providing adequately for the
uncle's family, devised a farm valued at $150,000 to Mr. Lothario Bickerly. It
March, 1958, Mr. Bickerly filed an instrument of renunciation in his uncle's
estate whereby he renounced any right, title or interest in the farm devise^ him
in the will of Don Juan Bickerly.

Final Examination in Law 329, First Semester 1958-59 Page 3.

On Nov. 1, 1958, while the divorce suit was pending, Mr. Bickerly was killed
in a head on collision with J. Wellington Waterloo on Route 150 just west of
Danville, Illinois. Mr. Bickerly was survived by eleven of his twelve children
and fourteen grandchildren. The assets held in the name of Mr. Bickerly at his
death included $^00,000 in securities and real estate valued at $1,000,000, all
located in Illinois. You may assume debts and costs of administration to be
$100,000 and Federal Estate tax to be $600,000.

After an appropriate period of mourning, Mrs. Carmen Bickerly retains you as
attorney for herself and her minor children in the matters relating to the estate.
During the estate administration, the following specific problems are raised for
your consideration and advice. You may assume the estate is administered in
Illinois.

1. The grandson, Franklin D. R. Bickerly, was one of the two surviving children

of Mr. Bickerly 's deceased child, Esmerelda, who died in April, 1958- Franklin
D. R. Bickerly was one of two attesting witnesses to the will of Mr. Bickerly.
A clerk of the Champaign Bank and Trust Co. was the other. Mrs. Bickerly asks
you what effect this has on the will. How would you advise her? Why? Particu-
lar reference to Illinois Probate Act sec. hk may be helpful.

2. Mrs. Bickerly brings you evidence that upon grandson Franklin's graduation from
business school in January, 1958, Mr. Bickerly purchased and gave to Franklin s
gasoline station business which cost $15,000. When Franklin married in March cf
1958, Mr. Bickerly paid off the mortgage on the home Franklin had purchasad.
The balance was $10,000 at the time the mortgage was satisfied. Mr. Bickerly
also gave Franklin $2,500 on each of his last two birthdays (August 15th) before
Mr. Bickerly1 s death. No other grandchild received similar gifts. Advise

Mrs. Bickerly of this significance, if any, of these facts.

3. During your investigation of the execution of the will, you di_ cover that it
was executed at the bank with Mr. Bickerly' s attorney present. After the
testator signed the will, he handed it to the two witnesses at the same table
and asked them to sign it. The pen used in signing went dry at this point, as
did Mr. Bickerly, and while the pen was being filled at the table by a witness,
Mr. Bickerly stepped over to the open door of the room and got a drink of water
from the cooler standing in the hall immediately adjacent to the open door.

Mr. Bickerly stood in the open door, leaning on the jamb talking to his
attorney about another matter while the witnesses were signing the will. He
did not see them sign and his back was toward them part of the time. After
they signed, they gave Mr. Bickerly the will; he thanked them and they left.
Mrs. Bickerly asks you to explain the effect this has upon the estate.

k.a. Mrs. Bickerly feels she should have a more substantial part of the estate
than was left to her. Assuming the will was validly executed, how would you
advise her? Why?

b. Mrs. Bickerly asks you for an opinion as to her rights in or to any part of
Mr. Bickerly' s Uncle Don Juan's farm referred to above. Ho\v would you advise
her? Why?

Final Examination in Law 329, First Semester 1958-59 Page k.

5. A year after letters testamentary were issued in Mr. Bickerly's estate,

Blackington White Bickerly makes a demand upon the personal representative to
discharge a purchase money mortgage of $100,000 against Whiteacre. The- mort-
gage is satisfied with his security and this is the first anyone has said any-
thing about the mortgage. Assume the will contains a provision authorizing
distribution in kind and that this mortgage is in addition to the debts pre-
viously indicated in the fact statement. What position would you urge on
behalf of your clients? What result would you anticipate? Why?

■•'

FINAL EXAMINATION IN DECEDENTS' ESTATES AND TRUSTS (Law 329)
First Semester 1959-1960 Professor Scoles

TIME: 3 Hours

INSTRUCTIONS

Note : Do not begin until the time indicated.

1. Print your name on the front of each examination book. Please do not write on
the front of the booklet .

2. Before answering a question, take time to think. Read the questions carefully,
analyze the facts, locate the issues, and organize your answer.

3- If you believe there is an error in any question or that additional facts are
needed, do not waste time consulting the instructor. State the correction or
additional facts you think necessary and answer the question on that basis. Give
full reasons in all cases.

k. Each answer should show a recognition of the problems presented by the facts,
the law applicable, your solution and the reason: .ng relied on by you to support it.
Analysis and reasoning, expressed clearly and concise.! y, are primarily important.
Make your answer complete, but do not volunteer ia js.ter3.aJ. information. Demonstrate
not merely your memory , but your ability to think. an answer does not

depend so much upon the mere correctness of the con ] . ". > a." upon the evidence it
displays of the elements abov- -.. iioned. No penalty will be iroposed for legibility.

5- Allocate your time so that each question is answered within the time allowed.

Final Examination in Law 329, First Semester 1959-1960. Page 2.

1. Saunders died about six months ago, leaving his residuary estate to Tarns, his
executor, in trust to pay the income to his daughter, Delia, for her life, with the
remainder in fee to his grandson, Garry. The will gave the executor and trustee
power to sell assets "as in his discretion he sees fit." The testator left
sufficient money in his bank accounts to meet estate obligations. About a month
ago, Tarns sold 100 shares of Wild Cat Oil Co. stock, which was inventoried in the
estate at $10,000, to his wife Tabby Tarns, who was an oil speculator in her own
right, for $12,000. Six days later Tabby Tarns sold 50 shares to Dodds, who knew
nothing of the prior transfers, for $25,000 and gave 50 shares to her son Ted Tarns,
who knew nothing about the prior transfers, as a wedding present . Ten days later
Wild Cat Oil Co. brought in three widely separated gushers on a 1000 acre tract
which it owned and its stock went up to $1000 per share. Delia and Garry have just
learned of these events and come to you for advice as to their rights in the matter,
'.-.'hat advice would you give and why?

2. The testator left his residuary estate to trustees to hold one-half in trust to
pay the income to his daughter Betty until she attained age 25, at which time she
was to receive the principal of the one-half free of the trust. If Betty should
die before age 35* the principal of the half was to be paid her estate . The other
half of the residue was to be held in trust to pay the income to Betty for life, re-
mainder to the testator's son Charles. The will also directed that the trustee re-
tain all securities owned by the testator at his death. Substantially the entire
estate consisted of the municipal bonds of Prairie Hill, Illinois, which the
testator had developed during his lifetime. The trust contained the following
clause :

"No interest of any beneficiary shall be subject to alienation, anticipation,
or attachment by any creditor or otherwise . "

Two years after the testator's death, Betty was permanently injured in an acci-
dent. She needs constant attendance and her current expenses exceed the trust in-
come by several hundred dollars annually. The trust is producing less than 2$ net
because of the low rate of interest on the Prairie Hill bonds . The trustee seeks
instructions from the court permitting him to sell the Prairie Hill bonds and rein-
vest in more productive investments and permitting him to invade equally the princi-
pal of both trusts to the extent necessary to maintain Betty in reasonable comfort.
Betty is now 21 and joins in this request. Charles, age 2k is made a party. What
result would you anticipate? Why?

3- S and T had discussed in a general way the possibility of T becoming the trustee
of an intervivos trust that S was contemplating setting up. Before anything con-
crete was agreed upon, T went to Europe on an extended tour. S's circumstances so
changed that it became important for him to set up the trust immediately. Without
further contacting T, S executed a trust instrument purporting to transfer a large
amount of securities to T in trust for B for life, remainder to R. The securities,
all bearer instruments or indorsed in blank, together with the trust instrument were
delivered to a local bank with a letter saying they belonged to T and directing the
bank to hold them subject to T's order. S then took a business trip to Australia.
The bank thereafter wrote to T in Europe listing the securities and asking for in-
structions. T answered saying:

Final Examination in Law 329 > First Semester 1959-1960. Page 3-

"I am not sure I can carry out S's plans. However I will talk to him next
summer about that. Sell the Bolivar Copper stock immediately. Buy Arredonda
Common with the proceeds. Hold the rest until I get back."

The bank carried out T's instructions. T returned six months later and after
a conference with B and R decided he would not serve as trustee and wrote to the
bank saying:

"I find I cannot accept the trusteeship of the S trust. I must refuse to serve.
You are directed to hold the securities subject to S's order."

Thereafter T ignored the bank, the securities, and all communications from S,
B, and R. Three months later S died before he returned. There had occurred a
$5,000 loss after T's first letter and before his second and a $10,000 loss after
T's second letter. Both losses were such that a reasonably prudent trustee could
and would have avoided them.

S's executor sues the bank to recover the securities delivered to the bank, B
and R claim the securities as beneficiaries of the trust and file a suit against T
to surcharge him for $15,000, to have him removed as trustee, and request a new
trustee be appointed. The Bank interpleads, all parties are joined. What results?
Why:

k. Nine years ago Stanton entered into an unfunded trust agreement with the Trenton
Trust Company under which he delivered to the trust company certain life insurance
policies in the face amount of $100,000 on his life. The beneficiary designated in
each policy was the Trenton Trust Company. Stanton expressly reserved the power to
change the beneficiaries of the policies and to amend or revoke the trust . The
agreement provided that the trust company, as trustee, acknowledged receipt of the
policies and agree upon the death of Stanton to collect the same and to hold the
proceeds in trust to pay the proceeds in equal shares i.e. one-fifth to Winifred,
his wife, and one-fifth to each of his four children as they severally attained 21,
if, but only if, Winifred took under his will. In the event that his wife Winifred
renounced his will, the proceeds were to be paid in equal shares to his children.
Stanton died last month and his will, which has just been filed for probate, dis-
poses of his net probate estate, consisting of $100,000 in securities and $50,000
in realty, in equal shares to his wife and his four children. Trenton Trust Com-
pany is executor and is directed to hold the shares of minor children in trust until
they reach their majority. Only two of the children are minors, one 15 and the
other 17- The widow, Winifred, files a motion in the probate court to require the
executor to inventory the proceeds of the life insurance payable to it as assets in
the decedent's estate. How would you support her claim? What result would you
anticipate? Why?

5- In 1955, a widower, Trapp, validly executed a will dividing his estate between
Alvin, a nephew, and his two sons, Bob and Charles. In 1959 > Trapp moved to another
town and later executed a will leaving his entire estate to his sons, Bob and Charles.
The 1959 will contained an express revocation clause revoking all prior wills.
After execution of the 1959 will, Trapp phoned his former attorney who had the 1955
will and directed him to tear it up, which the attorney in fact did while Trapp was
on the telephone. Trapp commented that he heard the will being torn up. Trapp

Final Examination in Lav.- 3^9, First Semester 1959-196o« -are -■

recently died and it was only then discovered that the 1959 will was attested by

but one person although another disinterested person was present. Alvin offers the
1955 will for probate by filing a photostatic copy vhioh had been retained ":y the
former attorney. What result vould you anticipate? Why? The pertinent statute of
the state provides :

Sec. U6. A will may be revoked only (a) by burning; cancelling, tearing,
or obliterating it by the testator himself or by sc~e perscr. ir. his
presence and by his direction and consent, (b) by the execution of some
other will declaring the revocation, (c) by a later will to the extent
that it is inconsistent with the prior will, or (d) by the execution :
an instrument in writing declaring the revocation and signed and attest;!
in the manner prescribed by this Article for the signing and attests." _
of a will. Unless the -..'ill expressly provides to the contrary: (l)
marriage of the testator revokes a will executed by the testator before
the date of the marriage; and (2) divorce or annulment of the marriage
of the testator revokes every beneficial devise, legacy or interest
given to the testator's former spouse in a will executed before the
entry of the decree of divorce or annulment, and the will shall take
effect in the same manner as if the former spouse died before the
testator.

No will which is in any manner revoked shall he revived otherwise
than by the re-execution thereof, or by an instrument in writing de-
claring the revival and signed and attested in the manner prescribe i by
this Article for the signing and attestation of a will.

FINAL EXAMINATION IK ESTATE AND GIFT TAXATION (Law 352)
First Semester 1958-1959 Professor Stephens

ALLOWED TIME: 3 HOURS

This examination consists of six questions. However, seme
of the questions have several parts. The relative weight to be
ascribed to each question or part is indicated by percentage figures
in parentheses throughout the examination. Plan your time to answer
all the questions.

Although brief answers are requested do not skimp on reasons,
which will be regarded as more important than conclusions for grading
purposes. The request for brevity is more a request that you organize
your answers with care and that you be concise.

If in order to answer any question you find it necessary to
assume additional facts, state what facts you are assuming.

1. On July 1, 1951, when D was 70 years old and well aware of many physical
frailties that threatened his life, he transferred outright to his sen S as a gift
100 shares of Z Corporation stock with a value at the time of $50,000. In March
1952 he filed a gift tax return reporting the gift but paid no tax. When D died
on July 1, 1953, S still owned the Z Corporation stock, which had risen in valve
to $100,000, and had received cash dividends of $5,000 on the stool: .

The federal estate tax return for D' s estate was filed by the executor on
September 15, 195*+ • The executor did not elect the alternate valuation date and
did not list the Z Corporation stock on the return. On September 1, 1957, the
executor filed a claim for refund of estate tax paid, based on the contention that
he erroneously had overvalued an asset included in the gross estate by $10,000.
When the claim was denied on July 1, 1958, "the executor filed suit for refund in
the district court against the district director to whem the estate tax had been
paid. On January 1, 1959, while the refund suit was pending, the commissioner
issued a notice of deficiency contending that the Z Corporation stock was errone-
ously omitted from D1 s gross estate.

Briefly discuss the following:

(5$) a. Circumstances that would support D1 s payment of no gift tax on
the 1953 transfer.

(5/o) b. The timeliness of the deficiency notice.

(5^) c. Alternate judicial remedies available to the estate upon receipt
of the deficiency notice, assuming it was timely.

(5$>) d. Factors that bear on the merits of the commissioner's contention
that the Z stock should have been included in D' s gross estate.

(5$) e. The amount to be included in D' s gross estate with respect to the
Z stock if the commissioner is sustained.

(5%) f» Whether the estate would receive a refund on the facts stated if
the commissioner' s deficiency notice were held to be untimely but La was sustained
in his contention that the Z stock should have been included in D' s gross estate.

«32

Final Examination in Law 352, First Semester 1958-1959 Fage 2

2. In 195*4-, D transferred property in trust with the income payable to h.s rife
for her life and with the remairder payable to the decedent or, if he was not liv-
ing at his wife's death, to his daughter or her estate. He retained no power or
other control over the trust. D died in 1958 survived by his wife and daughter.

Discuss briefly:

(5$>) a- The question whether or to what extent D made a gift subject to tax

in 1951*-.

(5^) b. The question whether or to what extent the trust property should "be
included in D's gross estate.

3. D was a spendthrift who had been unable to accumulate any property. However,
on January 1, 195$ > about six months before D' s death, his father died le^viug his
very substantial estate all to D. Upon his lawyer's advice D, who was a compara-
tively young, married man in excellent health, then created a trust consisting of
virtually all the property received from his father, naming himself the inccme
beneficiary for life and providing for payment of the income to his wife for her
life after his death. Upon the death of D and his wife, the trust was to be dis-
tribuxed to D' s children, if any survived, and if none, to the X charitable
foundation. D reserved no power whatever over the trust. He died July h, 1958,
survived by his wife and one child.

Briefly discuss:

(1C$>) a. The gift tax consequences of creation of the trust.

(10$) b. The extent to which the property will affect the estate tax
liability of D's estate.

h. When D died he left an estate of approximately $20C,CC0, all of which was
located in Illinois. He had never made any lifetime gifts of consequence. D, a
resident of Illinois, was a member of a large family and had a large family himself,
and D's wife was independently wealthy. Accordingly, by will he disposed of his
estate by making a $2C,0C0 bequest to his wife, a $20,CC0 bequest to each of his
five children, and a $10,000 bequest to each of his five brothers. The remainder
of his estate was left to the X charitable foundation.

(10$) Briefly discuss the liability of D's beneficiaries a:_d his estate for
Illinois death taxes. Would your answer be significantly different if about one-
half of D's estate consisted of Wisconsin farm land? Explain.

5- In 1950 D established a trust for the benefit of his five children. Cne chile,
S, was 35 years old and well on his way to becoming established in business. The
other children, all born to D's second wife, were younger and by no means estab-
li?hed. To insure an equitable distribution of the trust income dependent on cir-
cumstances as they developed, D provided that initially the annual income of the
trust should be divided equally among the five children but reserved the right to
shift such income interests within the group with the consent of S. D reserved no
rights in nor any other powers over the trust and provided that tne trust should
terminate when the youngest child should reach the age of 30, or in any event in
1970 in the case of the prior death of such child, at which time each child or his
estate should receive 20 percent of the corpus. D died in 1958.

Discuss briefly:

v**v

Final Examination in Law 352, First Semester 1958-1959 Fage 3

(lOfo) a. On a comparative basis the two provisions of the federal estate
tax statute that may hear on the includibility of the trust property in D1 J
estate.

(10$) b. With your answer to part "a" of this question compare thj gift
tax principles that bear on the determination of when a completed gift occurs for
gift tax purposes on facts such as these.

6. The federal estate tax is imposed without any attempt to apportion it among the
several states in accordance with their respective populations, as is required with
respect to some types of taxes by the Constitution. Moreover, although by sxatute
the proceeds of certain life insurance policies issued by the TFetei ins' Administra-
tion are expressly exempt from taxation, such proceeds have been held to be
includible in a decedent's gross estate for federal estate tax purposes.

(5$) a. Briefly discuss the basis for sustaining the estate tax again^ con-
stitutional attack under the apportionment provision and for interpreting the
statutory exemption provision concerning insurance so as not to exclude the pro-
ceeds from the gross estate.

(5$) b. Assume that when D died the effective option under an insurpnce
policy on his life, which D could change until he died, called for payments of
$270 per month to his wife for life but for a continuation of such payments for
10 years in any event, the payments to be made to D' s daughter or her estate if the
wife died before the expiration of 10 years. If the total value of the proceeds
was about $58, GOO and the insurance company allocated this $28,000 to the payments
to be made for 10 years certain and $30,000 to the payments to be made to the wife
for her life beyond the 10-year period, how would such proceeds affect the estnte
tax ljability of D' s estate?

FINAL EXAMINATION IN EVIDENCE (Law 326)

Second Semester 1958-1959 Professor Cleary

Instructions : Do not read the questions until the 1 o'clock

bell rings. Do not write more than one page per question.
There are eight questions .

1 . In a proceeding by the county to acquire a tract of land by eminent domain,
the following evidence is offered:

(1) By the landowner, the records of the county assessor, placing on
the land a value of $25,000 for tax purposes;

(2) By the county, a certified copy of a sworn objection filed by the
landowner with the county assessor, stating that the assessed value
was too high and the property worth only $10,000.

Discuss the admissibility of these two items of evidence.

2. D is on trial for the murder or a police officer. Assuming that all appro-
priate objections are made, discuss the admissibility of the following items of
evidence, offered by the state as part of its case in chief:

(a) Testimony of a bank cashier that, one week before the killing of the
police officer, the bank was robbed and that he identifies D as one
of the robbers.

(b) Testimony of a detective that he put on the clothes of a priest and
visited D in jail; that during the visit D said he had never belonged
to any church and was not sorry he had killed the officer.

3- Old man T died in 1958 > leaving as his heirs three sons, A,B, and C. By
his will, executed in 1958 , he bequeathed one -half of his estate to A and one -half
to B, the estate consisting of stocks and bonds . C has filed a suit to contest
the will, alleging fraud and undue influence. At the trial C calls W as a
witness. W was married to A in 1956 and divorced him after T's death. Through
W's testimony, C offers to prove that A said to W, a few days before the date
of the will, "B and I have made up some false stories about C and are going to
tell them to the old can." Assuming that all appropriate objections are made
to the admission of this statement, what ruling and why?

k. In a criminal prosecution for selling intoxicating liquor to a minor, D
testified on direct that he did not make the alleged sale. On cross-examination,
D was asked, "In the year preceding the date of the sale in question, did you at
any time sell any liquor to a minor?"

(1) Objection. Overruled. Answer, "No."

In rebuttal the prosecution called witnesses to prove other sales
to minors within the year .

(2) Objection. Overruled.

Discuss the propriety of the rulings on objections numbered (l)
and (2).

Final Examination in Law 326, Second Semester I958-I959 Page 2

5- P, as administrator of the estate of X, sues D for the wrongful death of
X. P' s complaint alleges that X was crossing the street at a marked crosswalk,
in the exercise of due care, and that D negligently drove at an excessive speed
and failed to yield the right-of-way, striking and killing X. As part of P* s
case in chief, W, the widow of X, was called and asked about X' s reputation for
being a careful man.

(1) Objection. Overruled. Answer, "He was a very careful man."

D then took the stand and offered to testify that he was driving
at a moderate speed and that X darted out in front of his car.

(2) Objection. Sustained.

Assuming that all appropriate objections are made, discuss the
propriety of the rulings on objections (1) and (2).

6. D Insurance Company issued B a life insurance policy which provided: "The
insured, before reaching age 60, may exchange this policy for any other form
of policy issued by the company, without medical examination, upon payment of
such additional premium as may be fixed by the company." P sued the company for
a declaratory judgment that he was entitled to the issuance of a policy provid-
ing for monthly payments in the event of disability. P alleged that he was
under 60, had tendered the additional premium fixed for the disability policy,
and had demanded such a policy, and that the company refused to issue it.

At the trial the company offered evidence that prior to the issuance of
the life policy, P had applied for a disability policy, had taken a medical
examination, had been shown to have an incipient disability, and had been ad-
vised that the company would not under any circumstances issue him a disability
policy. Discuss the admissibility of this evidence.

7. T executed a will on May 30 and died on June 1. In a suit to contest T's
will, on grounds of mental incapacity, the contestants offered in evidence a
hospital record, showing the following entries:

May 25
May 27
May 29

T admitted as patient. Diagnosis: Dementia praecox
Patient acting irrationally. Does not recognize relatives
Patient confined in strait jacket

Discuss the admissibility of these entries.

8. P sues D Broadcasting Company for defamation. At the trial P offers to
prove the defamatory statement by the testimony of witnesses who heard it on
their radio receivers. The defendant objects on the ground that the broadcast
was made by playing a tape recording, which it offers to produce. What ruling
and why?

■

FINAL EXAMINATION IN EVIDENCE (Law 326)
Second Semester 1959-1960 Professor Barnhart

TIME: 3 1/2 HOURS

1. Prosecution of James, vice-president of the First National Bank of Newtown,
for receiving deposits while the bank was in a failing condition. (R.S. C.38, §6l)
Prosecution offers testimony of X, Y, and Z, members of a committee of bankers
which, snortly before the acts complained of, had examined the books of the Newtown
Bank and the collateral it held as security for loans, for the purpose of
determining whether or not the banks they represented should continue making loans
to the Newtown Bank. X, Y, and Z are prepared to testify that in their opinion
the Newtown Bank was insolvent. Prosecution offers also the testimony of Adams,

an agent of an express company, that he had received for collection from a bank in
Peoria a draft drawn on the Newtown Bank, with instructions to accept nothing
but legal tender, although the custom was to accept exchange drawn on another
bank. The defense objects to all of the above. How should the court rule?
Explain .

2. (a) Insured was found dead in circumstances equally consistent with accidental
death and with suicide. He was insured under a policy which excluded payment of
indemnity in case of suicide, and included a double indemnity clause covering death
from bodily injuries effected through external, violent, and accidental means.

In a suit by the beneficiary of the policy, the plaintiff offered the fact of
death and rested. No other evidence was offered by either party except the
circumstances in which insured's body was found. How should the case be decided?

(b) Wrongful death action in which the defendant was alleged to have been the
driver of the automobile in which the plaintiff's decedent was a passenger at the
time of the collision which caused his death. The evidence tended to show that
the automobile was driven into the back of a trailer-truck on the open highway.
The truck driver testified that immediately after the impact, he walked back to the
automobile and found the defendant on the left-hand side of the front seat, his
body partially outside the left front door, and that the person later identified as
the owner of the car was on the right side of the front seat with his body
partially outside the right front door. There was evidence that the owner was
fatally hurt and that the defendant received severe chest injuries. The
defendant testified that at the time of the accident the owner was driving and
defendant was asleep on the right side of the front seat. The trial judge ruled
that the testimony of the truck driver as to the position of the defendant after
the accident created a presumption that the defendant was driving, but that the
direct testimony of the defendant that he was not driving overcame the presumption
as a matter of law and required the court to direct a verdict for the defendant.
Did the court properly apply the law of presumptions? Explain.

3- X is charged with the murder of S. At the trial the state offers a statement
of X. The defense objects that the statement is inadmissible and tells the judge
that X is ready to testify, that he was arrested and held for several days without
being taken before a magistrate, that he was subject to continuous questioning
for long periods by relays of officers, that he was not allowed food or rest
during the periods of questioning, and that he constantly requested to be
allowed to conmunicate with his family or friends or to call a lawyer and was
not permitted to do so. The defense states further that X will testify

Final Examination in Evidence (Law 326), Second Semester 1959-1960 Page 2

that when he persisted in denying any knowledge of the killing of S, the police
threatened to flog him, that he was struck once or twice, that he then agreed to
make a statement, that because of exhaustion and fear of physical torture he made
a statement, and that only then was he taken before a magistrate and charged
with murder. The state is prepared to admit the above facts except for the
allegation that X was struck or threatened, and insists that X made the statement
of his own free will, uninfluenced by any of the admitted circumstances. The
state proposes to offer W, a member of the state's attorney's staff, to testify
to the statement of X. The defense objects that a stenographer was present and
took down the statement in shorthand, later reduced to writing and signed by X
under compulsion, and that the written statement should be offered instead of
the testimony of W. There is evidence that X is 19 years of age, illiterate,
and of low mentality. What should the court do? What would be X' s rights if
the statement should be admitted and X convicted?

Later in the trial the defense offers the death certificate for S in which the
cause of death is listed as "suicide." Prosecution objects. What ruling?

h. J died after being struck oy a hit-and-run driver. Plaintiff, J's
administrator, sued D for wrongful death, alleging that D's car with D driving
struck J. The answer specifically denied the allegations of the complaint. At
the trial the plaintiff offers testimony of E, a police officer, that when R arrivec
at the scene he found M ministering to J, who was badly hurt, that M said,
"I saw the car that hit him and the number was 297013, " and that R wrote the number
down and now remembers it. M is in court and is ready to testify that he read
the license number on the car which he saw hit J, and that he told it to R but
does not now remember it. The number 297013 has been established as the license
number on D's car. D's lawyer objects to the testimony of R and M. The defense
as part of its case offers K to testify that she, a nurse, was at the hospital bed-
side of one T sometime after the date on which J was fatally hurt, that
T told her that he was driving his car and hit J, that he was frightened and
drove off without stopping, and that he knew that he was about to die and
wanted the truth about J's death known because he did not want an innocent
man to suffer for it. K further will state that T died shortly after making
the statement. Plaintiff's lawyer objects to this evidence. How should the
court rule on these objections?

If the judge sustains the objections, how should counsel preserve the
points for appeal?

* * * * * * #

In the following two questions, state whether the evidence offered is
admissible or inadmissible and give brief -- one- or two-line --
reasons for your answers. If the evidence would be admissible for
one purpose but inadmissible for another, so indicate.

5. Plaintiff sues for $25,000 for personal injuries received while a passenger
in the defendant's taxi which collided with a truck at an intersection.
Plaintiff charges that the taxi driver drove into the intersection without observin,
a stop sign.

m

Final Examination in Evidence (Law 326), Second Semester 1959-1960 Page 3

(a) The taxi driver had a similar accident at another intersection the day
before the collision in question.

(b) Prior to trial the plaintiff offered to settle for $500.

(c) Testimony of the truck driver that immediately after the collision
the taxi driver said, "My brakes didn't hold -- I tried to stop but couldn't."

(d) Defendant offers L, an attorney, to testify that after the accident the
plaintiff consulted L, who told plaintiff that he had no cause of action and
refused to take the case.

(e) After the accident the defendant repaired the brakes of the taxi.

(f) Plaintiff's wife is called to the stand to testify that plaintiff was not
badly hurt.

(g) Instruction to the jury: "The plaintiff has the burden of proof in this
case, which means that unless you are convinced of the truth of the facts which the
plaintiff has presented as establishing his case, then you should find for the
defendant. It is not enough that the evidence of the plaintiff preponderates
over the evidence of the defendant; it is also necessary that you be persuaded
that the plaintiff's evidence is true."

(h) Cross-examination of the taxi driver: 'How fast were you driving when
you approached the crossing?" Defense counsel objects that the answer might
subject the witness to criminal prosecution.

(i) Letter of one Mrs. M, who was an eyewitness to the accident. Mrs. M
wrote the letter to her mother the same day, describing in detail what she had
seen. Mrs. M is dead and the letter is in court, available to both parties.

(j) Testimony of T, dispatcher for the defendant taxi company, that the
driver involved in the accident was one of the most careful drivers and always
came to a full stop at stop signs.

6. Prosecution of C for larceny of a radio from the store of one Bell. Plea:
Not Guilty.

(a) Testimony of W that he has known C from boyhood and that C is a person of
upright character, always truthful and well-behaved.

(b) Articles seized in C's home by the police, who searched it without a
warrant, which articles are identified as having been stolen from several shops
including that of Bell. The articles do not include the radio.

(c) On the day of the alleged theft, C stole other things from stores in the
vicinity of Bell's store.

(d) Instruction that the presumption of innocence is like a bat flitting in
the twilight but disappearing in the sunlight of actual facts indicating the guilt
of C.

Final Examination in Evidence (Law 326), Second Semester 1959-1960 Page h

(e) Testimony that the character of C is bad.

(f ) C offered $100 to the officer who arrested him if he would let him go.

(g) Testimony of a policemen that when questioned about the stolen radio,
C said that it was a gift from C's wife.

(h) Testimony of C's wife that on the day of the theft, C came home and
surreptitiously concealed the radio in a cabinet.

(i) Question to C on the stand: "Didn't you get fired from your lest job
for drinking?"

(j) Question of state's attorney to Bell: "Where were you when C picked
up this radio and started to sneak out with it?"

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Final Examination in Law 356, Second Semester 195&-1959 ?~.ze 1 .

"Section 2. An automobile dealer may bring suit against any automobile
manufacturer engaged in coianerce, in any district court of the United

States in the district in which said manufacturer resides, or is founds
or has an agent, without respect to the amount in controversy, and
shall recover the damages by him sustained ar.d the ocst of suit by
reason of the failure of said automobile manufacturer from ar.d after
the passage of this Act to act in good faith ir. performing or comply-
ing with any of the terms or provisions of ode franchise, or in term-
inating, canceling, or net renewing ode franchise with said dealer :
Provided, That in any such suit the manufacturer shall not be tarred
from asserting in defense of any such action the failure of the dealer
to act in good faith. * * *"

The Jitney corporation, which produces popular cars, is about to brir.5; out a
new and expensive model which it wishes to market through its preseno dealers. To
assure adequate distribtuion, it proposes to establish a quota system ur.der which
each dealer is required to take one of the new oars for each five of the older
models he receives. Unless the dealer will agree 00 obis arrangement , Jitney pro-
poses to decline to renew his franchise, or, if the franchise is terminable at will,
to terminate the franchise . i-!any of the Jitney dealers are opposed to this proposed
arrangement and have threatened to invoke the statute. Some are located ir. Michigan,
where Jitney, a Delaware corporation, has its principal offices ar.d pianos. Jitney,
of course, would like a quick, decisive disposition 0:" the whole question,, including
the issue of the possible unconstitutionality of the statute.

Write a memorandum for Jitney's president explaining how, where and at whose
initiative issues relating to the statute's impact, if any, upon Jitney's proposed
course of action might be litigated.

III. As you know, Professors Hart and Wechsler disapprove the construction given
the Erie doctrine in Guaranty Trust Co. v. York, and subsequent cases. They sug-
gest that the "outcome" test should be supplanted by a substance -procedure test
which would classify as substantive "those rules of lav which characteristically
and reasonably affect people's conduct at the stage of primary activity", and as
procedural "those rules which are not of significant importance at the primary
stage." Federal courts would presumably follow state substantive rules, but would
express their own law on matters classified as procedural.

(a) How, if at all, would the Hart-Uechsler rule have changed the result in each
of the following cases?

1. Guaranty Trust Co. v. York (statute of limitations)

2. ;ohen v. Beneficial Industrial Loan Corp. (plaintiffs' bond in stockholders1
derivative action)

3- Angel v. Bullington (deficiency judgment on mortgage)

h. Klaxon v. Stento -""("interest on judgment)

5- Woods v. Interstate Realty (corporation not qualified to do business)

6. Bernhardt v. Polygraph Company (The first three headnctes in the United States
Supreme Court report of this case, 350 U.S. I9Q (1956), read:

"Petitioner's action against respondent in a Vermont state court, for
damages for the discharge of petitioner -under an employment contract,
was removed to the Federal District Court on grounds of diversity of
citizenship. The contract had been made in New York, where both parties

Final Examination in Law 356, Second Semester , I958-I959 Page 3.

resided at the time, and provided that the parties would submit any
dispute to arbitration under New York lav; but petitioner had later be-
come a resident of Vermont, where he was to perform his duties. Res-
pondent's motion for a stay of the proceedings so that the controversy
could go to arbitration in New York was den ied by the District Court,
which ruled that the arbitration provision of the contract was govern-
ed by Vermont law and that, under Vermont law, the agreement to arbi-
trate was revocable any time before an award was actually made. The
Court of Appeals reversed. Held: The judgment of the Court of Appeals
is reversed and the cause is remanded to the District Court.

1. The provision of § 3 of the United States Arbitration Act for
stay of the trial of an action until arbitration has been had does not
apply to all arbitration agreements but only to those covered by §§ 1
and 2 of the Act (those relating to maritime transactions and those in-
volving interstate or foreign commerce), and there is no showing that
the contract here involved is in either of those classes.

2. The difference? between arbitration and judicial determination
of a controversy substantially affect the cause of action arising under
state law and make the doctrine of Erie R. Co. v. Tompkins, 30^ U.S.
6k, applicable.

3. If in this case arbitration could not be compelled in the Ver-
mont state courts, it should not be compelled in the Federal District
Court."

(b) Which rule do you prefer? Why? Or would you prefer some other solution? Why?

IV. The Blue Ridge Railroad, incorporated in Delaware, owns and operates its rail-
road lines through Tassel County, Iowa. Its main office is in New York City, and
it operates railroad lines in seventeen states, including Iowa. It received
authorization from the Interstate Commerce Commission and the Iowa State Commerce
Commission to improve its lines through Tassel County and to acquire by condemna-
tion any land necessary for such improvement. The relevant Iowa statute provides:

"Any railway incorporated under the laws of the United States or any
state thereof may acquire by condemnation or otherwise so much real
estate as may be necessary for the location, construction and conven-
ient use of its railway.

"Proceedings to acquire land for such purposes by condemnation
shall be instituted by a written application filed with the sheriff of
the county in which the land sought to be condemned is located.

"The sheriff shall thereupon appoint six resident freeholders of
his county, none of whom shall be interested in the same or a like
question, who shall constitute a commission to assess the damages to
all real estate desired by the applicant and located in the county.

"Upon the filing of the commission's report with the sheriff, the
applicant may deposit with the sheriff, the amount assessed in favor
of a claimant, and thereupon the applicant shall have the right to take
possession of the land condemned and proceed with the improvements . No
appeal from such assessment shall affect this right to possession.

■

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■

Final Examination in Law 356, Second Semester, 1958-1959 Page k.

"Any party interested may, within thirty days after the assessment
is made, appeal therefrom to the district court of the county by giving
the adverse party, his agent or attorney, and the sheriff written
notice that such appeal has been taken.

"The appeal shall be docketed in the name of the owner of the land,
or of the party otherwise interested and appealing, as plaintiff, and
in the name of the applicant for condemnation as defendant, and be
tried as in an action by ordinary proceedings . "

Pursuant to this statute the Blue Ridge sought to condemn certain lands in
Tassel County, Iowa, owned and tenanted by one Cornhusker. After proceeding in
accordance with the first four quoted paragraphs of the statute, Blue Ridge took
possession of the property and Cornhusker was awarded the sum of $25,000, which sum
was paid to the sheriff by Blue Ridge. Thereupon Blue Ridge took the following
steps :

1) Filed a complaint against Cornhusker in the United States District Court
for the Southern District of Iowa, which encompassed Tassel County, alleging di-
versity of citizenship, jurisdictional amount, and the steps taken under the proce-
dure set forth by the Iowa statute, further alleging that the award of $25,000 was
excessive and requesting that damages for the taking of the land be assessed at
$10,000.

2) Filed a complaint against Cornhusker in the United States District Court
for the Southern District of Iowa, alleging diversity of citizenship, jurisdiction-
al amount, the authorization to condemn land pursuant to the orders of the two
Commissions, and praying that the District Court condemn the land and fix the amount
of compensation.

3) Filed an appeal from the assessment in the state court, the District Court
for Tassel County, Iowa. The case was docketed there, pursuant to statute, with
Cornhusker as plaintiff and Blue Ridge as defendant. Blue Ridge then removed the
case to the United States District Court for the Southern District of Iowa.

In the federal District Court, Cornhusker moved to dismiss the two complaints
filed in the federal District Court and to remand the case removed to the federal
District Court. Write an opinion disposing of the motions and all of the issues
raised thereby.

■

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-

FINAL EXAMINATION IN FEDERAL COURTS (Law 356)
Second Semester 1959-60 Professor Stone

TIME: 3 HOURS

Please do not write anything but your name on the first page of your
examination book; start writing your answers on page 3-

Begin each answer with a statement of your decision or your conclusions.
Explain your answers. If you think that you must make assumptions as to
fact or law, state what they are. LARGE CREDIT WILL BE GIVEN FOR BREVITY,
CLARITY, COHERENT ORGANIZATION, AND GOOD ENGLISH PROSE.

I. (Suggested time: 27 minutes) Discuss the soundness of the decision in one and

only one of the following cases:

(a) Skelly Oil Co. v. Phillips Petroleum Co., casebook, p. 769

(b) Indiana ex rel. Anderson v. Brand, casebook, p. U58

(c) National Mutual Insurance Co. v. Tidewater Transfer Co., casebook,

p. 351

II. (Suggested time: 72 minutes) Lauzier, a citizen of Massachusetts, filed his

complaint in the U. S. District Court for the
District of Rhode Island on March 29, 1956, against D'Onofrio Construction Co., a
Connecticut corporation doing business in Rhode Island. The matter in controversy
exceeded the jurisdictional amount. The complaint alleged that plaintiff was in-
jured on May k, 1955, while working on a scaffold in Newport, Rhode Island, as a
result of the negligence of the defendant. On February 13, 1957, D'Onofrio moved
for leave to bring into the action as a third-party defendant, Recon Company, Inc.,
a Rhode Island corporation. Leave having been granted, D'Onofrio filed its third-
party complaint against Recon, based on alternative theories of contribution or
indemnity, and charging that negligence by Recon, its agents and servants, caused
whatever injuries plaintiff had sustained. The demand for contribution placed re-
liance on the Rhode Island version of the Uniform Contribution Among Tortfeasors
Act, which, after establishing a right to contribution, provides in a section
added some years after the original Act was passed:

"A joint tortfeasor is not entitled to a money judgment for contribution
until he has by payment discharged the common liability or has paid more
than his pro rata share thereof. Actions for contribution shall be com-
menced and sued within two (2) years next after the cause of action shall
accrue to the injured person, and not after."

After Recon had secured five extensions of time, on May 28, 1957, it filed
a third-party answer, together with a motion to strike from the third-party com-
plaint all reference to a claim for contribution. The motion was based on the
contention that the third-party plaintiff had not yet discharged any common lia-
bility within two years after plaintiff's cause of action accrued, as required by
the Rhode Island statute as a condition for obtaining a judgment of contribution;
in resisting the motion, D'Onofrio relied on Federal Rule ll+(a).

In actions under the Rhode Island contribution statute brought in federal
court before the quoted provision was added, and in actions brought in federal
courts in other states where the quoted provision has not been added to the Uniform
Act, it has been held possible for a joint tortfeasor to be subjected to a suit for
contribution long after the period of limitations has run on a suit against him by
the original plaintiff. No Rhode Island decisions have interpreted the new pro-
vision, however.

Recon' s motion was granted by the District Court on December h, 1957; the
order dismissing the claim for contribution contained a certificate under Rule 5Mb)
that there was no just rep son for delay. D'Onofrio appealed.

Final Examination in Federal Courts (Law 356), Second Semester 1959-60 Page 2

(a) Recon moved to dismiss the appeal on the ground that the order grant-
ing its motion was not appealable because under Rhode Island practice review of such
an order would have to await final judgment. Assuming that Recon correctly stated
Rhode Island law and that the trial judge had correctly interpreted the precedents
in the United States Court of Appeals for the First Circuit concerning the availa-
bility of Rule 5Mb) when one of two alternative grounds of recovery has been
stricken from a claim, what decision on the motion to dismiss? Why?

(b) Assuming that the motion to dismiss was denied, whether correctly or
not, and that Rhode Island practice does not allow for the impleading of third-party
defendants as provided for under Federal Rule lU, should the trial judge's order be
affirmed or reversed? Why?

(c) While the case was pending in the Court of Appeals for the First Cir-
cuit, D'Onofrio and Recon joined in a motion, made on April 30, 1958, to dismiss
the complaint on the ground stated in the second sentence of Federal Rule 25(a)(1);
an affidavit was attached which showed that the plaintiff Lauzier had died on April
26, 1956, that his widow had thereafter been appointed administratrix of his estate,
but that no motion to substitute her as party plaintiff had ever been made. Mrs.
Lauzier then made a counter -mot ion under Rule 25(a)(1) that she be substituted as
party plaintiff. (Substitution can be made in the Court of Appeals.)

(i) Assuming that in Rhode Island practice there is no time limit
upon the making of a motion for substitution, what disposition should be
made of each motion? Why?

(ii) Suppose that a motion for substitution had been made 18 months
after Lauzier1 s death, but that Rhode Island law required dismissal if a
motion to substitute were not made within one year of death. What
decision? Why?

III. (Suggested time: ^5 minutes) The following resolution was adopted by the Con-
ference of State Chief Justices on August 23,
1958:
Resolution on Allocation of Judicial Power

WHEREAS the allocation of judicial power between the states and the
nation is largely made by the Judicial Code of the United States; and

WHEREAS the state judicial systems have not heretofore been consulted
as to the proper allocation of that power; and

WHEREAS the distribution of judicial power between the state and
federal courts does not appropriately reflect the interests of the
state judiciaries; and

WHEREAS no substantial revision of the Code has occurred since 1875;

NOW THEREFORE, BE IT RESOLVED that the Chairman of the Conference be
directed to appoint a special committee to examine the allocation of
jurisdiction between the state and federal courts now contained in
Title 28 of the United States Code;

BE IT FURTHER RESOLVED that the committee make recommendations to the
Conference for achieving a sound and appropriate distribution of
power between the nation and the states.

The special committee has been organized and has asked you to suggest the three
areas you consider most appropriate for the committee's initial attention. Restrict-
ing yourself to the subject matter covered in this course, what is your advice?

Final Examination in Federal Courts (Law 356), Second Semester 1959-60 Page 3

IV. (Suggested time: 36 minutes) Because the widows of federal agents who die

in the line of duty are often needy, an appro-
priate Congressional committee has under

consideration a bill which would add a new section, §1350 l/2, to the Judicial

Code:

"Section 1350 l/2. Widow's action for death of federal agent

The district courts shall have original jurisdiction of any
civil action brought by the widow of any special agent of the Federal
Bureau of Investigation, any Treasury agent, or any other peace of-
ficer of the United States Government, on any claim arising out of
the death of her husband in the line of duty."

Write a memorandum for the committee which will explore and recommend conclusions
as to issues of policy and of constitutionality, if any, involved in such a pro-
posal.

FEBAI EZAME8A3KK 321 7~~- ZS~E3ZSIS lav l-i
Secord Seoester 1958-1959

Ilcce: I :.:ur.

1) Print your rare or the front :f ea:r. exseutat i :r. booklet. Pleese d: not
write anything else :r. the front :: the booklet;.

2) Before writing an answer, take tiae tc think. Bead the :_esci:r. caret —

•ze the facts, identify the Issues, and organize :_:• answer.

3) Analysis and reascr.ir.-. expressed clearly and concisely, are priBsrily
i [portent, legibility is al_sc to be desired.

k) All questions are given equal weight. Allocate your ti e ;; each cuesci.v
is answered within the time allowed.

1. The testator devised his residuary estate tc the children of Archibald, to

be naif. -":.er. they should respectively attain the age cf t--= rt y - e r.e . la:- child
is to receive "'r.e accumulated inco e :r. bis share when the share is paid tc him.
At the testator's death. Archibald had three children,. 5cb . age ~, risrer.ce, age
5, and Ion, age 3- Bob died at age ~ and luring the following two •.•■ears Archi-
bald bad two children, Elsie and Fannie. Fifteen years after the testator's
death,. Archil:. Id had si ill arcther child, Bert, and a year later, Ilarerce the
oldest of Archibald's children cither than Bob, attained the age :: rventy-cre.
'-oat is riarence 's share and what share it the ethers have? Why?

2. By her father's will, Doris was given a Life estate in 5 : 1.*. Til and the power
tc appeirc the principal by will tc ant ar.crg her children cr any ether kindred

shall survive her in such shares and tanner as she shall think proper. In
default tke property was tc pass tc Doris1 descendants and in a'cserce c: such
descendants to the then living heirs of the doner. In !---• at the age 1~
Doris married Frank, who was then 21. A nonth after her nsrriage tc Frank,
Doris executed a will in which she appointed £H0O,00C to her children, should
she have any,, $50,000 to her favorite cousin Charles and $-:.:■:: to .varies'
eldest son Edward. Icris and Frank :- :. particularly happy earriage and one
child, a son, was bom in 19^3- In l-~r. the cousin's son, Bdward, 're care in-
volved in a protracted law suit. In If':. Doris executed a second will, revekdng
the first. By the 1958 will, she appointed id :■:.:■;: :: her sen, and Sj ;:.;'."" tc
her cousin Charles. In an exchange :f letters shortly before tee l-'-f -ill was
executed, Icris had ashei and Charles had afreet that be would Bake a gift cf
$150,000 to Frank after Charles . ed the sun appointed tc hen. Icris

was killed in an air crash in West Virginia this sprint. The trustee under .
father's will has filed a bill for instruct icr.s for final iistrihution of the
trust principal. A guardian ad Litea »~s.s appointed for Icris' son. Tat should
be the positions urged hy the parties? hat result -eld ycu anticipate? !

3. In 1921, Adatcs conveyed ten acres cf lard free, his l6C acre fara :c -he trustee;
of a religious organization "to have and :: held .is long as the property is lised

for the church purposes cr as an evangelical caup and vhen :. cr used as sue -

the sscie is to revert each to the original tract of lard and its then e-.ters.

FINAL EXAMINATION IN LAW $k6, Second Semester 1958-1959 PaSe 2-

Later in 1931, Adams conveyed 150 acres to Mr. and Mrs. Baldwin. In the deed to
the Baldwins, the land was described as "the S.W. l/k of Sec. l6 excluding
approximately ten acres deeded for a church camp in 1922." The Baldwins sold
the farm to Ohsse in 1938 by description similar to that in their deed. Chase
has owned and farmed the land since that time. In 1939, Adams conveyed the
church camp by quitclaim deed to Baldwins for five dollars ($5.00). In 19^0,
the church abandoned the church camp and conveyed it by quitclaim deed to Chase
for $250.00.

In I9U1, the Baldwins conveyed the old church camp land to Davis for $500.00.
Since then no one has actively occupied the land. All of the people mentioned
have cut wood and hunted on it from time to time. The land is still carried on
the assessment rolls as being owned by a charity so no taxes have been paid.

About 1953, oil was discovered on nearby land and in 195^ Chase filed suit
to quiet title to the ten acres in himself and Adams and Davis were made defendants
and each defendant claimed the land. What result? Why?

k. The testator died in 1956 leaving a will by which his residuary estate was
given to trustees "to hold and pay the income from one half to my wife for life
and to pay the income from the other half to my daughter, Dawn, for life; remainder
to my two sons Able and Baker, their heirs and assigns. In the event of death
of either of my sons without issue the whole shall go to the other." The
testator was survived by his wife, his daughter, Dawn, his bachelor son, Able,
and his son, Baker, who had been married only six months. The widow renounced the
will and took her statutory share . Baker died two years later survived by his
wife, Carol, to whom he left his entire estate by his will. Able married in
1957 and now has an infant son. Last month Dawn died in an auto accident, sur-
vived by her mother who was her sole legatee and her brother Able . Dawn was
unmarried. Able has contracted to sell a farm which constituted the bulk of the
testator's residuary estate. The buyer questioned the title and Able files a suit
to quiet his title. The testator's widow, who is still alive, and Carol, Baker's
widow, defend and cross petition for partition. What result and why.

5- Thompson died in 19^0, testate. By his will, he gave $30,000 in general be-
quests and then gave the residue of his estate to his wife, Wanda, as trustee to
pay herself the income for life and at her death, in absence of an appointment the
principal was to be paid to his nephew Ralph. The widow was given a general testa-
mentary power to appoint the principal as she saw fit. The residuary trust prin-
cipal amounted to $100,000 in negotiable securities when it was turned over to
Wanda as trustee. Ralph successfully requested the probate court to require Wanda
to post a bond for the "proper administration of the trust and protection of the
remainder interests." The bond in the sum of $100,000 was posted by a corporate
surety, Defiance Indemnity Co.. Wanda died recently leaving a will by which she
appointed one -half the principal of the trust to Ralph, her husband's nephew, and
one -half to her niece, Mary. It has developed that Wanda invested the trust funds
in speculative and unlawful ventures and that only $30,000 remains of the trust
assets. Wanda's only assets will amount to $20,000 in personalty after administra-
tion (disregarding any trust litigation) and were bequeathed by her will to her
nephew Harry. Ralph and Mary institute proceedings against the Defiance Indemnity
Co. on the bond, Harry and Wanda's executor are made parties. Assuming all questions
can be litigated in this court, what final result would you anticipate and why?

FINAL EXAMINATION IN LAW "$&, Second Semester 195c-155? Bags _:.

6. The testator's will provided: :'In rer.euhrar.:e ti aany kindnesses ":y Philip
Potter and his family, I give SlOjOCO to the Industrial Trust Bo. tc pay the
income to Philip Potter for life art then tc pay the principal ir. equal shares

to the grandchildren of Philip Potter.1'

Philip Potter is a sprightly widcver cf l'z with four children ranging in
age froc. 25 to 37- His eldest son, Earcld, had two children., ages 1 and 2.
at the death of the testator. The other children of rhiltr Plotter it not yet
have children. Philip Fetter has recently become engaged to a young women sged

28. The residuary legatee cf the testator's will asserts the Tetter trust is
invalid and passes to him as part of the residue, '..hat is your upinicail Hhyl

FINAL EXAMINATION IN FUTURE INTERESTS (Law 3

Second Semester 1959-1960 Professor Scoles

Time : 3 hours

Instructions

NOTE; Do Not "begin until the time ir.dic_~ed

1) Print your name on the front of each examination booklet. Please do net
write anything else on the front of the booklet.

2) Before writing an answer, take time to think. Read the question carefully,
analyze the facts, identify the issues, and organize your answer.

3) Analysis and reasoning, expressed clearly and concisely, are primarily
important. Legibility is also to be desired.

U) All questions are given equal weight. Allocate your time so each question
is answered within the time allowed.

.

In 1923, a suburban real estate promoter conveyed a strip of land containing
k l/2 acres to an electric railway company pursuant to an agreement under which
service was to be extended to the suburban community from a nearby metropolis .
The deed conveyed the land "in fee simple so long as the premises are used for an
electric railway. Should the property be used for any other purpose it shall
pass to the Village for public purposes." No other pertinent provisions appear
in the deed. About six months ago, the electric railway company removed the
tracks and station and spent $250,000 in converting the tract into a parking
area which the company last month leased to the village for a 20 year period.
The heirs of the grantor file suit against the railroad, the village and any
unknown grantees of either, to quiet their title and to regain possession of
the tract now worth upwards of a million dollars . What result would you
ant ic ipate ? Why .

2.

Adams died fifty years ago, leaving a will which provided in part:

"Third. I devise the Fourth Avenue building (valued at $100,000) and 1000
shares of Pacific Steel (valued at $75,000) in trust to my trustees heretofore
named with full power to sell or retain and invest and reinvest except that
no investment shall to be held more than ten years unless a majority of the
trustees shall so determine. The trustees shall pay the income to my son Boyd
for his life and at Boyd's death, the income shall be paid to the children of
Boyd living at Boyd's death as joint tenants for the life of Boyd's surviving
child. At the death of the last surviving child of Boyd, the corpus shall be
distributed as such last surviving child shall by will appoint among my descendants
living at Boyd's death.

"Fourth. All the rest and residue of my estate I give to Charles."

Boyd had three children, the youngest of which was born six months after
Adams' death. Boyd died thirty years ago. Boyd's youngest child, Dale, survived
his siblings and left a valid will which stated "I appoint Grandfather Adams '
Trust to Young." Young is a first cousin of Dale who was alive at Boyd's death.
Shortly after Dale's death, Boyd's three grandchildren, each representing a
deceased child, and the executor of Charles' estate threatened to sue the trustees
if the corpus were paid to Young. The trustees petition the court for instructions.
How would you advise the trustees to distribute the property? Why?

3-

The testator left his entire estate to his wife for life, with directions
to his executors at her death to "pay $1,000 to each of my son Sam's children as
attain 21 and the balance to the children of my son Paul as attain 21." At the
testator's death, Sam had one child Alex, age 11. At the widow's death, Alex
was 22 and his only sibling, Bob, was 12. A year after the widow's death, Sam
had twins, Cal and Doug, and is optimistic about the future. Paul also has
three children; Lil, age 12, born before the testator's death; Mary, age 8, born
during the widow's life; and Nancy, 2 months, born a year after the widow's death.
The executors have not yet distributed the estate. How and when would you advise
the executors to distribute the estate? Why?

J-JJ-

k.

The testator, a widower, died survived by three children and leaving a
net estate of approximately $350, COO, which was disposed of as follows:

"5. I will $100,000 to my trustees in trust to pay the income there-
from to my daughter Delia for her life, and at her death to her husband
for his life and after his death to distribute the corpus to her then
surviving children or surviving issue of deceased children per stirpes.

"6. I will $100,000 to my trustees in trust to pay the income there-
from to my son Oren for his life and at his death to his widow for her
life and after the death of the survivor of them to pay the income
to the surviving children as joint tenants for the life of the last
surviving child and after the death of such last surviving child to
distribute the property to Oren's grandchildren or issue per stirpes
then surviving.

"7. The rest and residue of my estate I will to my only other child,
Norton, his heirs and assigns."

Delia, age 50, and her husband Tom, age 51> have three children. Oren,
age k5, and his wife Sarah, age V?, have two sons. Norton, age UO, has just
recently married. The executor petitions for an order of distribution setting
forth the interests of all concerned. How should the property be distributed?
Why?

5.

Able left the residue of his estate in trust to pay the income to Baker for
life, remainder as "Baker shall by will appoint to such one or more of his
children or other issug as he sees fit and in default of appointment to Baker's
children equally in fee." Baker died leaving a will appointing to his son Carl
(who was alive at Abie's death) for life, one-half the remainder as Carl should
by will appoint to his issue or spouse, the other half as Carl should by will
appoint, in default to Carl's son, Donald. Carl died leaving a will which gave
to his wife, Uendy, (who was alive at Abie's death) all of his property including
property over which he had a power to appointment. Donald comes to you and tells
you that his uncle Eph (short for Ephraim, Baker's only other child) is claiming
the trust property. Donald asks your advice as to the interests in the property.
How would you advise him? Why?

The testator died seventeen years ago leaving by his residuary clause
valuable farm lands to "my beloved wife, Winifred for her life or widowhood
and at her decease or remarriage, I devise such farms to the children of my
two sons in equal shares and their heirs forever." The testator was survived
by his widow and two sons, his only descendants. Cne son died before the widow
without ever having issue. The widow died a short time ago, survived by Albert,
a gay but childless bachelor about fifty years old. Albert has tendered your
client a favorable offer to sell or lease the premises. Your client has wanted
the farm for sometime for his operations and is willing to enter into either
transaction but dislikes buying a "pig in a poke". Your client seeks your advice
as to what he may do about the offers tendered by Albert, What will you tell him?

Uh-u?

FINAL EXAMINATION IN FUTURE INTERESTS (Law 346)
Summer Session i960 Professor Cribbet

TIME: Three hours and fifteen minutes

Please write legibly, succinctly, and briefly. The major emphasis
should be on legal analysis, not on a wordy discussion of irrelevant
points.

I. (Uo points) The course in future interests has a variety of objectives. One
of these is to develop skill in spotting troublesome language in
deeds, wills, trusts, etc. The following limitations are

litigation-producers. What is the problem in each instance and what result do you

think a present-day Illinois court would reach? Why?

(1) 0 devised to A and the heirs male of his body, remainder to B and his heirs.

(2) 0 devised to A for life, remainder to those sons of A who survive him and
attain the age of 30. A, who survives 0, has three sons, X, Y, and Z. X
predeceases 0; Y predeceases A; Z survives A but is only 17 at A's death.

(3) 0 devised to A for life, remainder to B for life if B survives A, remainder
to B's heirs if B survives A.

(U) 0 conveyed Blackacre to A for life, remainder to B and his heirs so long as
the land is used for school purposes, then to "my" (0'c) heirs.

(5) 0 devised to A for life, and on A's death to such persons as A shall appoint
by will. A appoints by will to his brother B, who predeceases A by two days,
survived by one son, X, and a grandson, Y, son of a deceased son of B.

(6) 0 devised certain property to A and gave A a power to appoint certain other
property to any person in Henry County except himself (A) or his estate. A
exercises the power by deed and appoints to his son B at a time when A is
insolvent. Creditors of A try to reach the appointed property.

(7) 0 devised to A, a nephew, and his heirs but if A dies without issue to B for
life, remainder to C. A, who is now dead, had two children who died in
infancy. B died in the lifetime of A. C was the only son and sole heir at
law of 0 and still survives. A's wife W is also still alive.

(8) 0 devised to A and his children. At the execution of the will, A had a
child B who predeceased 0. A also predeceased 0 by a few weeks, but A's
wife was then pregnant with a daughter C, subsequently born alive.

(9) 0 devised to A and the children of B. A and B are children of 0. At the
execution of the will B has five children but at 0' s death only three survive.
One of the deceased children died at the age of five; the other is survived
by one child. A dies without issue in the lifetime of 0.

(10) 0 devised to A for life, and if A die without children, then to B if B shall
survive W (O's wife). A died in the lifetime of 0 survived by C, a son, and
D, a daughter. B and W both survived 0 and are still alive.

Final Examination in Future Interests (Law 3^6), Summer Session i960 Page 2

II. (20 points) Sometimes language is deceptive; it looks clear enough at first

reading but contains booby traps which may explode after a testa-
tor' s death. Explain the problems implicit in the following
language, frequently found in wills.

(11) "To all my grandchildren, now four in number (naming them) and any other
grandchildren hereafter born to my two children."

(12) A will leaves the residue to W for life, "then to the children of my scn;
to be paid at their respective ages of 21."

(13) "To A for life and then to the children of B when the youngest reaches 25."
(lU) "To A for life and then to the children of A who reach 21."

(15) Deeds too contain pockets of quicksand, e.g., "To my wife for life, "hen to
my children. ' What are the possible constructions'? What dc you think the
grantor meant? How might he better have accomplished his purpose?

III. (15 points) Even though the legal document is carefully drafted, it may give

rise to unforeseen difficulties. If you were a judge, how would
you decide the following cases? Why?

(16) 0 gave his son A a life estate in property with power to appoint by will to
one or more of 0' s lineal heirs. A appointed to his brother B, on condition
that B pay certain specific debts of A's and pay an annuity to A's widow.

B knew nothing about this until A's will was admitted to probate. Result?

(17) O's well-drafted will gave A a general power of appointment over 20C shares
of A.T.&T. stock, exercisable by will only. A fell on evil days and, while
insolvent, covenanted to appoint to X in return for a substantial lean.
Shortly before his death, A inherited outright ICO shares of A.T.&T. stock.
At his death, A bequeathed "my stock in A.T.&T." to his son B. In the residu-
ary clause of his will, A left "all the rest and residue of my property to

my beloved wife, W." What happens to the 200 shares of A.T.&T.? How much
help would the following (Virginia) statute provide?

"A devise or bequest shall extend to any real or personal estate,
as the case may be, which the testator has power to appoint as he
may think proper and to which it would apply if the estate were
his own property, and shall operate as an execution of such power,
unless a contrary intention shall appear by the will."

(18) T devised a tract of land (3CO acres) to his grandson A for life :'and after
his decease to the heirs of his body lawfully begotten, and their heirs and
assigns respectively forever, in such manner and shares as the said A may see
fit to divide it among them." T' s will had a residuary clause leaving the
residue of his estate to the X Church. A had two daughters, two sons, and an
adopted son. By his will A exercised the power as follows: three acres to
one daughter, three acres to another daughter, ninety-four acres to one

son, one hundred acres to another son, and one hundred acres to the adopted
son. What result?

Final Examination in Future Interests (Lav? J>h6) , Summer Session i960 Page 3

IV. (25 points) If a testator successfully avoids the traps of archaic language,
peculiar constructions, and odd rules from a feudalistic past,
he may still stumble over the law's policy against creating
perpetuities. Consider the following cases:

(19) A will left the residue in trust, income to go to T' s son for life, then to
T's grandchildren, until the youngest attained twenty-one years and nine
months, at which time the corpus was to be distributed to living grand-
children; if all grandchildren died under twenty-one, then to the Childrens
Hospital. The will also stated: "If any provisions of this will should be
void on account of the rule against perpetuities or any other rule of law
pertaining to such trusts, then the trusts herein provided shall continue
in force for the full period permitted by law and on the day prior to the
expiration of such full period, the trustee shall make distribution of any
remainder of the trust estate to the persons herein named who would be en-
titled to take distribution thereon upon termination of the trust." T was
survived by a son, S, and a daughter, D. Each child had two children and
all four grandchildren were under five years of age. S and D claim the
residue as sole heirs at law, alleging the trust to be void. Result?

(20) The will of Anne Slocome, widow, bequeathed to her son and sole heir, five
dollars, declaring be was to have no further role in her estate because of
his lack of interest in his mother. Anne then gave the residue of her estate
in trust for the children of the son, share and share alike. The trust was
to continue until the youngest of the said children living at the time of
Anne' 6 death should reach the age of thirty-five or, if the youngest child
should die before reaching such age, at the date the child would have reached
such age if he had lived. The will further provided: "In the period from my
death until the termination of said trust, the income from said trust shall
be divided equally among such children as may be living, and paid to them in
quarterly installments. Should any such child die during the period of said
trust estate, leaving no children, the income shall be divided among the
surviving children equally. The child or children of any deceased child
shall succeed to the share of the parent, per stirpes and not per capita.
When said trust is so terminated, the corpus thereof and any undistributed
income shall be divided equally among such chi3.dren of my son as may then

be living, the children of any who may have died to take their parent's
share, per stirpes and not per capita."

At the testatrix's death the youngest child of the son was one year
old. There were three older children living at that time. How much, if
any, of the disposition is valid? Why?

Name No .

FINAL EXAMINATION IN INCOME TAXATION (LAW 328)

Second Semester 1958-1959 Professor Stephens

Allowed Time: 3 l/2 Hours

This examination consists of two parts. In Part I there are 30 multiple-
choice questions that will be graded on the basis of 2 points of credit for
each question answered correctly, without any penalty other than loss of
credit for incorrect answers. In Part II there are k- hypothetical questions
that will be scored on the basis of 10 points each. Thus, the examination
will be graded on the basis of a maximum of 100 points.

Part I

Do not devote more than one hour to this part until you have completed
Part II.

The thirty questions in this part are of the familiar multiple -choice
variety. Of the four possible completing statements in each question, mark
only one by placing an X on the proper blank. If you feel that a question
presents a close choice, select the completing statement that you think can
best be defended as accurate in all likely circumstances. Indicate your
answers to this part on the examination paper.

1. No federal income tax is likely to be imposed on the salary of:

a. The governor of any of the United States.

b. A member of the Federal Trade Commission.

c. A foreign service officer of the State Department who is abroad uninter-
ruptedly for several years .

d. The foreign sales representative of a United States corporation who is

out of the country almost all the time for several years.

2. The exclusionary principle upon the basis of which the first question can be
answered is found in:

a. An express provision in the United States Constitution.

b. An express provision in a federal statute.

c. A Treasury Regulation adopted under a statutory provision authorizing
but not directing such exclusion.

d. A Supreme Court decision resting on broad constitutional principles.

3- An express statutory provision excluding from gross income interest paid on
state bonds is traceable at least in part to:

a. Early indication of judicial doubt concerning the scope of the federal

taxing power.

FINAL EXAMINATION IH LA",/ 328, Second Semester 1958-1959, Part I PaSe 2.

"b. A Congressional desire to treat alike interest paid on state and foreign
bonds .

c. A Congressional desire to equalize competition in the sale of state and
federal bonds.

d. A reluctance on the part of Congress to tax a common element of the

income of widows and orphans.

h. If a taxpayer receives something of value in circumstances not expressly
dealt with by the Code, his chance for excluding the item from gross income
will be best if he can correctly argue that it:

a. Does not represent "wealth available for recurrent consumption, recur-
rently received."

b. Is "a restoration of capital."

c. Is not "gain derived from capital, from labor, or from both combined."

d. Represents "punitive damages, rather than damages for lost profits."

5. If union benefits paid to striking members can properly be excluded from
the members' gross incomes, it must be because:

a. The amounts paid are to supply food and lodging, receipt of which is

generally exempt from taxation.

b. Such benefits, even when paid only to striking workers, constitute gifts,

c. The Code expressly excludes from gross income amounts received in exchange

for an agreement not to do something.

d. Supreme Court decisions interpreting "incomes" as the term is used in

the l6th Amendment indicate that Congress lacks power to tax such receipts.

6. In cases of divorce the spouse who pays alimony:

a. Can exclude from gross income all amounts he is required to pay period-
ically under a judicial decree.

b. Is taxed on his entire income without regard to alimony payments.

c. Can claim a deduction for periodic alimony payments, including amounts
paid for child support, if the decree specifically requires such support
payments .

d. Can claim a deduction for periodic alimony payments, except the part of
such payments which the decree fixes as for child support.

Page 2

-

FINAL EXAMINATION IN LAW 328, Second Semester 1958-1959, Part I Page 3-

7. Although amounts received by a person upon the death of another generally
escape income tax, there would not be excluded from gross income an amount:

a. Received under the state's laws on interstate succession.

b. Received by one admittedly an heir in settlement of his suit attacking the

will.

c. Received by one as an heir after judgment in a will contest suit in which

the will was set aside.

d. Received as a result of successful suit to enforce the decedent's con-
tractual agreement to bequeath property to the recipient.

8. The United States Supreme Court has held that gross income does not include
amounts received by means of:

a. Illegal bootlegging operations.

b. Embezzlement.

c. Unlawful gambling.

d. Extortion.

9- One who receives amounts under an ordinary single-life annuity policy with
no refund feature can exclude from gross income:

a. All such amounts until the total received equals his cost for the policy.

b. A portion of each amount received until his death, determined with respect

to his cost for and his expected return under the policy.

c. A portion of each amount received as indicated in b, above, but only until

he has been pevndtted to exclude his cost.

d. All that he receives each year that is in excess of 3$ of his cost until

he has excluded an amount equal to his cost for the policy.

10. An individual's discharge of his indeb+edness by payment of something less than
the full amount is held not to result in income subject to tax:

a. If such discharge would be treated as a gift by the creditor to the debtor
for gift tax purposes .

b. If the debtor was insolvent both before and after the discharge of the
indebtedness.

c. If the indebtedness arose out of the purchase of property from someone other
than the creditor.

d. In any case in which the debtor consents to make a downward adjustment in
the basis of property owned by him.

Page 3

FINAL EXAMINATION IN LAW 328, 8econd Semester 1958-1959, Part I Page k.

11. The income from a trust will be taxed to the settlor, even though payable and
paid to private beneficiaries, merely because:

a. The corpus of the trust will revert to the settlor twelve years after the

creation of the trust.

b. The corpus will revert to the settlor upon the death of the life beneficiary.

c. The trust income can be used to discharge the settlor's obligation to sup-
port minor children.

d. Someone with no interest adverse to the settlor can direct the trustee to

return the trust corpus to the settlor.

12. Absent special circumstances, an ordinary private trust that is required to
distribute all its income currently is:

a. Exempt from taxation.

_b. Treated in much the same manner as a corporation,
c. Treated in much the same manner as a partnership.

d. Taxed upon all the income it receives without regard to what it must

distribute .

13- If an individual makes a gift to charity of property that has a fair market
value in excess of his basis for the property:

a. He can deduct only the amount of his basis in determining taxable income.

b. Ke can elect to deduct the fair market value of the property if he consents

to be taxed on the difference between that and his basis.

c. He can deduct the fair market value of the property without being taxed

on his gaxn.

d. He would have fared as well or better tax -wise by having sold the property

and given the proceeds to charity.

l^-. Amounts paid for the services of a child of a taxpayer:

a. Can eliminate the taxpayer's right to claim a deduction for the child as

a dependent.

b. Are taxed to the taxpayer if the child is under l8.

c . Are taxed to the taxpayer if such amounts are treated as his property
under local law.

d. Cannot be offset by the child's deduction for personal exemption if the
taxpayer claims the child as a dependent.

Page k

FINAL EXAMINATION IN LAW 328, Second Semester 1958-1959, Part I Page 5-

15. In family partnerships in which capital is a material income producing

factor, and in which the partners' incoaie interests are in direct proportion
to their capital interests, a donee partner's share of the income:

a. Is always taxed to him in full.

b. Is taxed to such donee except where established principles apply to tax

the entire income to the donee ' s parent .

c. Is taxed to the donee except where services of the donor partner require

adjustment of the agreed income interests .

d. Is not immediately recognized for tax purposes if the donee is a minor

but will later be taxed as an accumulation distribution.

l6. A corporation's election of "tax-option" or "pseudo -corporation" status
under Code Sections 1371 et seq. :

a. Eliminates the coroorate tax at the expense of making shareholders directly

taxable on the corporate income .

b. Relieves such a corporation from the normal tax but not the surtax.

c. Makes applicable to such corporation the partnership provisions of the Code.

d. Is most likely to be advantageous if the corporation's shareholders are all

in a very high tax bracket.

17- The relationship between the "standard deduction" and the concept of "adjusted
gross income" is such that:

a. Election of the standard deduction forecloses all other deductions that

the taxpayer might otherwise claim.

b. The standard deduction is in lieu of most deductions for ordinary and

necessary business expenses.

c. The standard deduction is in lieu of most deductions for otherwise deducti-
ble personal expenditures.

d. Wage earners who are not making heavy interest payments on personal in-
debtedness rarely benefit from the standard deduction.

18. A taxpayer probably can claim a tax deduction for:

a. The cost of replacing some rotting boards on the floor of the porch of his

residence.

b. Amounts paid to discharge the debts of his former employer, a bankrupt

corporation, if paid to establish his credit standing in business.

_ c. Legal fees incurred in the collection of rent for residential property that

he holds for investment. N

d. The payment of state taxes on property owned by his son.

"Do rro ^

FINAL EXAMINATION IN LAW 328, Second Semester 1958-1959, Part I Page 6.
19. A tax deduction can properly be claimed for the expense of travel:

a. From an employee's home to his regular place of work.

b. In search of new employment.

c. Away from home in pursuit of business, even though in pursuit of business
for the taxpayer's employer.

d. To the place of a new job secured with a new employer.

20. If a taxpayer proves that he has incurred deductible business expenses but
cannot prove the exact amount thereof, he will be allowed to deduct:

a. Only such amounts as he can prove were incurred.

b. An amount representing a reasonable though perhaps conservative estimate

on the known facts.

c. The amount claimed less such amounts as the government can prove were not

in fact incurred.

d. No part of such expenses, disallowance of the provable expenses being the

statutory penalty for an excessive or unsupported claim.

21. A taxpayer can treat as a deductible business expense the cost of education:

a. To improve skills used in his current employment.

b. Necessary to his promotion in his current employment.

c. Needed to qualify him for a job with a new employer.

d. Essential to his qualifying for a specialty within his chosen profession.

22. No immediate deduction is presently authorized for an individual's expenses
incurred in:

a. The management of property held for investment.

b. A suit to quiet title to investment property.

c. The maintenance of property held for the production of income.

_d. Contesting federal income tax liability.

23. If in the fourth year of a five-year lease, under which the lessee has an
option to renew for five years, the lessee places an improvement on the
property which has a useful life of ten years, the cost of the improvement
will probably be written off as a tax deduction:

a. By the lessee over the remainder of the five-year term.

b. By the lessee over the term of the lease plus the optional renewal period.

c. By the lessee over the ten-year life of the improvement.

d. By the lessor rather than the lessee. Page 6

•

FINAL EXAMINATION IN LAW 328, Second Semester 1958-1959, Part I Page J.

2k. There is authority supporting a taxpayer's expense deduction (rather than
capitalization) for the cost of:

a. A substantial wire fence put around a plant for wartime security.

b. Permanently partitioning a general office to provide space for private
offices.

c. Lowering a basement floor to adapt a basement to a new business use.

d. Lining basement walls to prevent oil seepage that threatened continued

use of the basement of a packing plant.

25. The Code permits the deduction as tax paid (without regard to any possible
connection with business) of:

a. State assessments against local benefits designed to increase the value

of the property assessed.

b. State real property taxes imposed for general revenue purposes.

c. The federal excise on admissions.

d. The federal income tax.

26. If a taxpayer purchases improved property adjacent to his business property
and, as initially planned, razes the building on the newly acquired property,
replacing it with an addition to his business buildings, he can:

a. Take a loss deduction for the part of the purchase price attributable to

the razed building.

b. Treat the part of the purchase price attributable to the razed building

as a part of the cost of the new building for depreciation purposes.

c. Amortize the part of the purchase price attributable to the razed

building over the period it would have been useful if not razed.

d. Treat the part of the purchase price attributable to the razed building

only as a part of the cost of the land.

27. If a taxpayer bought a personal pleasure car for $3,000, used it two years
with a shrinkage in actual value to $1,500, and it was then completely
destroyed (no salvage) in a collision for which he received no insurance or
other compensation, his loss would be :

a. A non-deductible personal loss.

_b. Deductible in the amount of $3,000.
c. Deductible in the amount of $1,500.

_d. Deductible in an amount equal to $3,000 less the amount of straight line
depreciation that would have been allowed if the car had been used in
business.

Page 7

FINAL EXAMINATION IN LAW 328, Second Semester 1958-1959, Part I Page 8.

28. If a taxpayer made a loan to a friend to aid the friend in meeting a personal
need and the friend's obligation became worthless, the taxpayer should:

a. Treat the loss the same as a casualty loss.

b. Treat the loss as a short terra capital loss.

c. Treat the loss as a long term capital loss.

d. Claim no deduction for the year of worthlessness but charge the loss

against the reserve usually set up to take into account such losses.

29. A cash method-calendar year individual would not Include in gross inocme
for 1958:

a. Salary credited to his account by his employer, which he could have with-
drawn in 1958 but did not withdraw until 1959*

b. Interest credited on savings bank deposits in 1958 but not withdrawn that

year.

c. Interest coupons on bonds, which matured in 1958, but which coupons were

not clipped because the individual was physically unable to go to the bank.

d. A salary check mailed in accordance with regular practice on December 31,

1958, but not received until January 2, 1959-

30. If a cash method lessee of business property pays $5,000 cash as rent for
a five-year leasehold upon execution of the lease:

a. The $5,000 is income to the lessor and deductible by the lessee in the

year the lease is executed.

b. The $5,000 is income to the lessor in the year the lease is executed but

deductible by the lessee in part in subsequent years.

c- The $5,000 is income to the lessor in the year the lease is executed only

if the lessor is on the cash method but without regard to the lessee's
accounting method.

_d. The $5,000 is income to the lessor only in part in the year of execution
if the lessor is on the accrual method.

Page 8

FINAL EXAMINATION IN INCOME TAXATION (LAW 328)

Second Semester 1958-1959 Professor Stephens

Fart II

1. Assume that the taxpayer is single and that without regard to transactions
discussed in this question he has taxable income for the year 1958 in excess of
$50,000. In that year he sold the following items of property:

Adjusted basis Sales Price

a. His personal residence $35,000 $3°, 000

b. A truck used in his contracting 800 2,000
business

c . A milling machine used in his

contracting business 500 300

d. Unimproved realty held for

investment 1,000 ^,000

Each item sold had been owned by the taxpayer for more than one year .

In addition, the taxpayer had purchased 100 shares of Builders' Supplies, Inc.,
in 1955 for a total cost of $3,000. In 1953 the corporation went into bankruptcy
and its assets failed to discharge fully its obligations to its creditors.

Making (and stating) any further assuinptions you deem necessary, indicate how
these circumstances will affect the taxpayer's income tax liability for 1958-
Whether or not you show a confutation (which you need not do), explain fully your
conclusions .

2. X owns 1000 acres of farm land which he purchased for $20,000 subject to
a mortgage of $5,000 (still outstanding) which he did not assume. The property is
potentially good farm land but needs much work done on it before it can be operated
profitably. Y has cash that he is willing to put into a farming venture with X.
They agree that X's land has a market value of $35*000. Upon deciding to form the
Farm Corporation, the following exchanges take place:

a. Y receives 100 shares of stock in the newly formed corporation for $25,000
cash.

b. X contributes his property, subject to the mortgage, and receives from the
corporation :

(1) 100 shares of its stock,

(2) and $5,000 cash.

It may be assumed that the stock received by each shareholder is worth $25,000
when issued.

What is X's "realized" gain, if any, on the exchange? To what extent, if at
ill, is his gain "recognized"? What is X's basis for his 100 shares of stock?
Explain .

.

Final Examination in Law 328, Second Semester 1958-9, Part II Page 2.

3 • The taxpayer owns a residence in which he has lived for several years . He
acquired it by devise from his father in 195^ when it had a value of $26,000, even
though his father had purchased it for $20,000 several years earlier. A vould-be
buyer has offered $30,000 for the house, which he is vailing to pay in equal $5,000
amounts, giving notes secured by a mortgage for the deferred payments. The tax-
payer is tempted by the offer but completely uninformed as to the possible tax
consequences of its acceptance and quite undecided whether or where or when he may
acquire a new residence if he sells his present one. Bill him in on the possible
tax consequences fully but succinctly.

k. T's father gave him 100 shares of X Corporation stock on June 1, 1956-
At that time the shares v/ere worth $10,000 but T's father had paid $12,000 for
the stock when he purchased i% in 195'+- In 1958, T sold the same 100 shares to
his wife for $8,000. Late in 1959 T;s wife contemplates a sale of the stock.
Indicate what the tax consequences will be upon her sale if she sells the stock:
(a) for $6,000 and (b) for $12,000. Fully explain your answer.

u»

FINAL EXAMINATION IN INCOME TAXATION (LAW 328)

Second Semester 1958-1959 Professor Stephens

Part II

1. Assume that the taxpayer is single and that without regard to transactions
discussed in this question he has taxable income for the year 1958 in excess of
$50,000. In that year he sold the following items of property:

Adjusted basis Sales Price

a. His personal residence $35,000 $30,000

b. A truck used in his contracting 800 2,000
business

c . A milling machine used in his

contracting business 500 300

d. Unimproved realty held for

investment 1,000 U,000

Each item sold had been owned by the taxpayer for more than one year .

In addition, the taxpayer had purchased 100 shares of Builders1 Supplies, Inc.,
in 1955 for a total cost of $3,000. In 1958 the corporation went into bankruptcy
and its assets failed to discharge fully its obligations to its creditors .

Making (and stating) any further assumptions you deem necessary, indicate how
these circumstances will affect the taxpayer's income tax liability for 1958.
Whether or not you show a computation (which you need not do), explain fully your
conclusions .

2. X owns 1000 acres of farm land which he purchased for $20,000 subject to
a mortgage of $5,000 (still outstanding) which he did not assume. The property is
potentially good farm land but needs much work done on it before it can be operated
profitably. Y has cash that he is willing to put into a faming venture with X.
Ihey agree that X:s la^c. has a market value of $35»000. Upon deciding to form the
Farm Corporation, the tallowing exchanges take place:

a. Y receives 100 shares of stock in the newly formed corporation for $25,000
cash.

b. X contributes his property, subject to the mortgage, and receives from the
corporation :

(1) 100 shares of its stock,

(2) and $5,000 cash.

!t may be assumed that the stock received by each shareholder is worth $25,000
fhen issued.

What is X's "realised" gain, if any, on the exchange? To what extent, if at
11, is his gain "recognized"? What is X's basis for his 100 shares of stock?
Explain .

■

Final Examination in Law 328, Second Semester 1958-9, Part II Page 2.

3 . The taxpayer owns a residence in which he has lived for several years . He
acquired it by devise from his father in 195^+ when it had a value of $26,000, even
though his father had purchased it for $20,000 several years earlier. A would-be
buyer has offered $30,000 for the house, which he is willing to pay in equal $5,000
amounts , giving notes secured by a mortgage for the deferred payments . The tax-
payer is tempted by the offer but completely uninformed as to the possible tax
consequences of its acceptance and quite undecided whether or where or when he may
acquire a new residence if he sells his present one . Fill him in on the possible
tax consequences fully but succinctly.

k. T's father gave him 100 shares of X Corporation stock on June 1, 1956.
At that time the shares were worth felO,000 but T's father had paid $12,000 for
the stock when he purchased it in 195^- In 1958 > T sold the same 100 shares to
his wife for $8,000. Late in 1959 T's wife contemplates a sale of the stock.
Indicate what the tax cor sequences Td.ll be upon her sale if she sells the stock:
(a) for $6,000 and (b) for $12,000. Fully explain your answer.

'

fuiai ex i ::;::::; m ::;:::z zaxatich law 326

Second Semester 1959-19 Professor Yc

ALLOWSE FBE: ; BOOT

:::£~v:r:::;:

(1) Begin vriting on the second page cf tie examination booklet. Start each
question at the top of a nev page.

(2) Organize your answers carefully. State fully ycur reasons. Budget your
time.

^r . _ =; _ e 5C

(3) Adhere to tee indicated space limitations. Each
examination book is treatei as one page
Quality, not quantity . is preferred.

(U) Students may have the CCb pamphlet copy :: the Internal Revenue I tie with
them.

I. (20$) (a) T, a distinguished university professed :: physics, wrote a letter

to the editor cf the student newspaper :h vas published on tie
editorial page en 15 November 1955- In the letter. 7 advocated
appeasement of Soviet Russia ty surrender of Vest Berlin, publication of all our
atcmic and other defense secrets, admission of Red China to the United Rations, ani
withdrawal of United States support of Jorucsa. As a consequence of one latter, a
number of persons charged that I vas a :cmmunist. Phis lei to ^ hearing by the
board of regents of the university tc determine whether ~ should be continued in bis
position. T retained an attorney to represent bin at the nearirg. Co finance tbe
expenses involved, T borrowed ;1,5CC at tbe local bank en 1 December 1959 -ton tbe
security of his promissory note due 1 March i960. These funis were immediately
paid over to his attorney. The hearing was held during the last week of lecember
1959, and on 15 January i960, the board of regents ruled that 1 should be retained
on the faculty of the "university. On 1 February 1::.. I paid his attorney an adii-
tional $1,CC0 for his services. In 1 March Ijf:. 1 paid the ncte which fell due at
the bank.

(b) Immediately fclicving the hearing by the hoard of regents. 1 filed suit for
damages against certain individuals cased on allegations of libel. Ibis suit --as
settled on 1 April i960. T received $10,OOC in the settlement, zi which |2,00C was
paid to his attorney for legal services.

T reports his income on a cash ani calendar year 'cases, be requests your
advice as to the proper treatment of these transactions for inccme tax purposes.
Discuss. (3 pages)

EI. (20$) In 1955, A, an architect, enterec cute a contract with V Tec— oration -c
prepare certain preliminary designs for nev buildings which -"ould be re-
cuired for plant expansion. Under one terrcs of the contracc. A vas cc
receive a fee of $10, ICC for his services. A completed the work as of 1 September
L95Q • Upon completion cf his services, cue president of M Corporation, pursuant tc
authorization by the hoard of directors, offered an Ic-month assignable cp-_:n to
purchase ICO shares of treasury common stock par value rll. at a price of 31-" per
share. The option vas offered in lieu of tbe S1C.CC1 fee. although the Corporation
indicated its willingness tc pay in cash if A preferred.

As of 1 September 1958> the M Corporation stock was selling at £20C per snare.
This was the price at which the M Corporation stock bad stabilized for a peric
)f about a year prior to 1 September 195-'. A agreed tc accept tbe option which
'as granted as of 1 September 1955 ani extended cc 1 March 1 fter

;he execution cf the option, the price of M ::_- 1 tion stock began to iecline.

Final Examination in Income Taxation (Law 328), Second Semester 1959-60 Page 2

By 1 July 1959, the M stock had declined to $150 per share. On that date, A assigned
his option to B, an attorney, in payment for legal services which had been rendered
in connection with A's business operations and which had been billed in the amount
of $5 > 000. B held the option expecting the price of the M stock to recover. How-
ever, the price continued to drop and by 1 March i960, the M stock was selling at
$90. B permitted the option to expire on that date.

Discuss the tax consequences of these transactions: (a) to A (2 pages); (b)
to E (l page); (c) to M Corporation (l page). A and B report their income on a
cash and calendar year basis; M Corporation, on an accrual and calendar year basis.

III. (10$) In Rev. Rul. 60-158, published 25 April i960 in 1960-17 Internal Revenue

Bulletin, the Internal Revenue Service announced that "fees paid to an
employment agency" in obtaining employment are not deductible expenses.
In issuing this ruling, the Service revoked an old ruling, O.D. 579 (Office Decision),
3 Cum. Bull. 130 (1920) in which it was held that "fees paid to secure employment
are considered allowable deductions." On 20 May i960, the Internal Revenue Service
announced that Rev. Rul. 6O-I58 "is revoked" and that "the Service will continue to
allow deductions for fees paid to employment agencies for securing employment." What
is your appraisal of this action of the Internal Revenue Service and the implications
thereof? Discuss fully. (2 pages)

IV. (20$) On 1 July 1958, T Corporation employed A as vice president in charge of

production at a salary of $5,000 per month, payable semi-monthly, for a
term of five years ending 30 June 1963- Early in i960 it became appar-
ent that A's services were unsatisfactory. On 1 March i960, the board of directors
gave A notice that his employment would be terminated as of 1 June i960. A immedi-
ately threatened to bring suit for damages for breach of contract. After considerable
negotiation, a settlement agreement was executed by the parties which provided for
the following payments to A:

$3,000 per month, June i960 through December i960

$2,000 per month, 1961

$1,500 per month, 1962

$1,000 per month, 1963

$1,000 per month, 1964

Your firm serves as legal counsel for T Corporation. The Corporation reports
its income on a calendar year basis and by the accrual method. You have been re-
quested to advise the corporation as to the proper tax treatment of this trans-
action. What do you advise? Discuss fully. (3 pages)

V. (20$) H and W were divorced 2 January 1959- Pursuant to an agreement incorpor-

ated in the decree of divorce, H was required to convey to W the fee
interest in the residence which had been occupied by them as their home.
The home had been purchased in 19^5 at a total cost of $60,000 including a mortgage
of $1*0,000. Title to the property was taken subject to the mortgage. At the date
of the divorce, the balance due upon the principal of the mortgage was $2^,000,
which was payable in annual installments of $2,000 over a 12-year period, with
interest at five per cent per annum on the unpaid balance. The property was valued
on 2 January 1959 at $120,000. The agreement provided that W would accept H1 s equity
in the property in full satisfaction of her dower and other property rights in H's
estate. The decree also provided that, in addition to alimony of $200 per month,
H should pay the principal and interest upon the mortgage and the local property
taxes upon the home. During the year 1959, H made the following payments: $2,000
upon the principal of the mortgage; mortgage interest of $1,200; and real property
taxes of $1,800.

Final Examination in Income Taxation (Law 328), Second Semester 1959-60 Page 3

H, who regularly prepares his own tax return, claimed a deduction in his 1959
return for the monthly alimony payments of $200. It has subsequently occurred to
him that the other transactions relating to his divorce should have been included
in his 1959 return. He consults with you. What do you advise? Discuss.
(3 pages)

VI. (lOfo) On IT May i960, the Fifth Circuit, in a divided opinion, held that a
Louisiana state supreme court justice could deduct as traveling ex-
penses the rent paid for an apartment in New Orleans which he and his
wife occupied while the court was in annual session in that city. The taxpayer's
family home was 75 miles distant. State law required two years' residence in the
judicial district from which a justice was elected as a prerequisite to eligibility,
and required continued residence therein during the term of his office. The tax-
payer received a salary as full compensation for his services without reimbursement
for traveling expenses, meals and lodging. No deduction was claimed by the taxpayer
for transportation or meals.

It is likely that the government will apply for certiorari in this case. Dis-
cuss the prospects upon review by the Supreme Court in the light of the Peurifoy
decision and any other relevant factors. (Mimeographed copies of the Peurifoy
decision are included with the examination materials.) (2 pages)

FINAL EXAMINATION IN INSURANCE (LAV.' 338)
First Semester 1958-1959 Professor Davis

TIME ALLOWED: THREE HOURS

Instructions: A sample Multiple Automobile Policy is distributed with the
examination questions. To the extent of all relevant provisions (disregarding
car description, names, dates, places, and figures inserted in the cample),
assume that the various policies involved in Questions 3 and h are in the form
of the sample policy, except as otherwise stated.

1. X's accident insurance policy, payable to his estate, covered death ''resulting
from bodily injury, sustained and effected directly through external, violent,
and accidental means." X was in the American army in Korea, and after the ces-
sation of hostilities was shot and killed in a fight with another American sol-
dier. A clause excluded death occurring "while the insured is enrolled in zhe
military service in time of war." The insurer refuses to pay. X's executor

can prove, if the evidence is admissible, that X took out the policy during the
Korean conflict, after he had joined the army and had been assigned to overseas
duty, that the soliciting insurance agent knew these facts when he book the
initial premium, and that the insurer received and cashed a remittance for the
second annual premium which on its face made it clear that X wat> in military
service in Korea. Advise the executor whether to sue the insurer or to forget
it, and write a supporting memorandum.

2. The Y Fire Insurance Company issued to A a $50,000 policy of fire insurance
covering the fluctuating stock of goods in A's furniture store. A standard
mortgage clause made the policy payable to B "as his interest r..„y appear." B
held a mortgage on the fluctuating stock in the store to secure present and
future advances to A. At the time of the fire described below, A owed B
$10,000. The policy insured against all "direct loss by fire, while the books
and inventories of the insured are kept in a fireproof safe or locked fireproof
file cabinet, and not otherwise," and also contained the following clause: "It
is warranted by the insured that he will take a complete itemised inventory of
the stock on hand at least once in each calendar year, and that he wi.. 1 maintain
a set of books presenting a complete record of business transacted, and will keep
such books and the last two such inventories in some place not exposed to fire
which would destroy the building. Any failure by the insured to comply with the
terms of this clause will render the policy void." The insured had a fireproof
safe in the store and habitually used it. But one Saturday night he was working
on the books until after midnight and expected to return about 6 a.m. on Sunday
to continue the work. Not wishing to disturb his work, he left the books si read
out on his desk. In fact he was too tired to return on Sunday morning, and the
books were left out for the week-end. On Sunday night a fire in the store, of
unknown origin, destroyed $15,000 worth of the furniture. The value of the re-
maining stock substantially exceeds the amount of the debt owed to B. The books
were not touched by the fire, and from them the status of the stock was accurate-
ly reconstructed. The insurer disclaims liability, and A su_s. C intervenes,
claiming as B's assignee for value of the debt, of the mortgage, and of the
insurance. No notice of the assignment was given to A or the insurer. Decide
the case .

FINAL EXAMINATION IN INSURANCE (LAW 338) Page 2.

3- J and his son S jointly owned a car that was described in a liability policy
issued by L insurance company, both J and S being named as insureds. While this
car was undergoing repairs, Mrs. J lent her car (insured against legal liability.,
with Mrs. J as named insured, by A insurance company) to S, who gave perrissioi.
to T to drive it. T's own car was out of gasoline at the time. While driving
Mrs. J's car, within the scope of S's permission, T tortiously caused personal
injuries to P in a head-on collision with P's car. At this time T was named
insured in a liability policy on his own car (not involved in the accident)
issued by M insurance company. The personal injury liability coverage of each
of the policies mentioned herein was limited to a liability of $20,00u to each
injured person. P obtained a judgment against T for $25,000 on account of
personal injuries. As soon as it became final, P sued insurers L, A, and M.
What decision? Do not consider the facts stated in Question h.

h-. Assume the same facts and parties are those described in Question 3- Mrs.
J's car was also insured by A insurance corpany against accidental loss cr damage
by collision or upset. X held a chattel mortgage on the car, and va.s named in
the policy as payee in an open loss-payable clause. In the "Declarations" of
the policy it was stated, "The automobile will be principally gcraged in
Champaign, Illinois." When the policy was issued and for six months thereafter,
Mrs. J lived in Champaign and kept her car there most of the time. Three weeks
be for j the accident, however, Mrs. J and her family moved to Chicago to live,
and the accident occurred there. Insurer A paid to X the amount of the collision
damage to Mrs. J's car. Insurer A then sued Mrs. J, T, and insurers L and M.
What decision?

End of Examination

FINAL EXAMINATION IN INSURANCE (Law 338)
First Semester 1959-1960 Professor Davis

TIME ALLOWED: THREE HOURS

1. Jake's declarations to an agent of Insurer X in obtaining an automobile
liability insurance policy contained the following questions and answers :

Q: Did any company ever decline to write automobile liability insurance for

you?
A: No.

Q: Do you have defective eyesight or hearing?
A: No.

In fact several companies had declined to write insurance for Jake because of his
defective vision and hearing. Prior to this application, however, both had been
adequately corrected, by glasses and a hearing aid. No question on the form
elicited information about convictions, but Jake had been convicted three times of
drunken driving. On the last such occasion his driver's license had been revoked
for a year. Since a judgment for damages, still unpaid, had also been rendered
against him on that occasion, the financial responsibility act of the state re-
quired liability insurance before Jake might regain his license. Insurer X issued
the policy applied for and certified issuance to the motor vehicle division without
inquiring why the act applied to Jake. Subsequently Jake negligently injured
Hortense by speeding while sober, and Insurer X disclaimed any duties under the
policy. Hortense reduced her claim to a judgment against Jake, and now sues on the
policy. Decide the case and state your reasons, both under common-lav principles
and in the light of any commonly enacted statutes affecting the problem.

2. A policy insuring the XYZ Manufacturing Company against payroll robbery con-
tained the following clause :

It is agreed that one armed guard with no other duties will be on duty
within the premises at all times when money, intended for the payroll
of the Insured, is exposed to robbery loss. Otherwise this policy shall
be null and void.

A relevant state statute reads as follows :

No breach of warranty or condition shall avoid an insurance contract or
defeat recovery thereunder unless such breach materially increased the
risk of loss, damage or injury within the coverage of the contract.

In an action on the policy the insured proved that payroll money had been delivered
to its accounting and disbursing office, which was in a small building separate
from the rest of the plant, at about one o'clock in the afternoon. The money had
been placed and locked in a 600-pound safe. No armed guard was present at any time
that day. A few minutes later armed robbers threw more than a dozen hand grenades
through the doors and windows of the building and killed all the personnel within.
The robbers then took the safe with the payroll money locked inside and escaped.
What decision?

Final Examination in Lav 338> First Semester 19?9-1960 Page 2.

3- The Preferred Life Insurance Company has its home office in Hartford, Connecti-
cut. It maintains an agency in Albuquerque, New Mexico. On November 5> 1959* Paul
Praline applied to the Albuquerque agency for a $20,000 policy on his life payable
to Ann Oxia as beneficiary and requested that the right to change the beneficiary
be not reserved. Praline paid $735 and was given the following receipt:

November 5, 1959

An application for a $20,000 policy having been made by Paul Praline,
there has been collected from him $735 to be considered the first annual
premium on said policy provided the application is approved by the Com-
pany at its home office, and in that event the insurance as applied for
will be in force from this date . If the application is not approved,
the sum collected will be returned.

Preferred Life Insurance Co.
By Fred Facile, Agent

The application papers reached the Company's home office on November 8. On Novem-
ber 9 "the home office received a telegram from Praline withdrawing his application
and demanding that the premium be returned. On November 10 the home office approved
Praline's application, mailed the policy applied for to its agency at Albuquerque
with instructions to deliver it to Praline, and wrote Praline directly saying that
it could not return the premium "which our representative in Albuquerque accepted
from you in good faith." On November 11 Praline was killed in an automobile
accident. On November 12 the policy reached Albuquerque. At all material times
Praline and Ann Oxia were engaged to be married; but the New Mexico statutes pro-
vided that "all civil causes of action for breach of promise to marry are hereby
abolished. "

Ann Oxia sues Preferred for $20,000. The administrator of Praline's estate sues
Preferred in two counts, one for $20,000 and another for $735- The suits are
consolidated. What decision?

k- In 191*1 P took out a 20-year term fire policy in the face amount of $20,000
with the Z Insurance Company on a residence situated in Illinois and owned in joint
tenancy by P and his brother. The policy was written in the 1918 New York standard
form, and named P only as the insured. P paid the premium in advance for the full
term. P's brother died a week after issuance of the policy. In 19^+6 P took out
another 20-year term fire policy, also for $20,000, on the same house with the X
Company. The full premium was paid in advance. This was a 19^-3 New York standard
policy. Both policies contained the following provision:

This Company shall not be liable for a greater proportion of any loss
than the amount hereby insured shall bear to the whole insurance, whether
collectible or not, covering the property at the time of loss.

In 1959 P offered to sell the insured house to a prospective buyer for $^0,000.
The next day, before the prospect could act on the offer, the house burned to the
ground. The prospective buyer is willing to testify, however, that he had made up
his mind to accept P's offer before learning of the fire. What are P's rights
against the Z Company and the X Company?

End of Examination

No.

FINAL EXAMINATION IN INTERNATIONAL LAW (Law 3U8)
Second Semester 1958-1959 Professor Carlston

IMPORTANT: You will find a number in the upper right-hand corner of this page.
This will be your examination number. Your grading will be made without
knowledge of your name. A list of the members of the class will be passed
around. Place your examination number in the space opposite your name on this
list. Do not write your name on either this question sheet or the examination
book.

You will have 3 l/2 hours for answering this examination. Always
state reasons for your answers.

25 1. A revolutionary group of about 100 armed men land on the coast of
points Panama. They had obtained their arms and vessel in Cuba and had sailed

from a Cuban port. Panamanian natives join in their movement. The
Panamanian army refuses to fire upon citizens and the government is overthrown.
A government named the Peoples Republic of Panama is then established and shows
itself to be composed of Communists. The new government declares the canal regime
to be at an end and the treaty with the United States establishing that regime to
be terminated pursuant to the principle of rebus sic stantibus.

(a) The United States, affirming its intention to maintain its rights under
international law by force, if need be, lands forces in Panama, a- . swiftly es-
tablishes its military power throughout the state. It then conduct: e] : -tions by
secret ballot and a new government is elected and placed in office. The United
States leccgnizes this government and advises it that the United States will be
available whenever it might call upon the United States to assist it in maintaining
its pc/eier.gnty.

(h) The Organization of American States holds a meeting in which a resolution
is passed ncndemning Cuba for supporting attempts to overthrow other American
states by force or revolution as action in contravention of international law.

Discuss the extent to which the actions of the United States and the Organi-
zation of American States in (a) and (b), respectively, are well founded in
international law.

15 2. What evidences of international law occur to you to support your
points conclusions in 1 (a) above, and to what degree are they entitled to
weight in supporting your conclusions?

25 3- A United States military plane, based in Denmark under NATO, while
points enraged in reconnaissance is shot down by a Soviet military plane at

a point 8 miles off the Russian coast in the .Baltic Sea. The plane
crashes into the sea. Its cr -v are picked up by a Danisn fishing vessel then
drifting towards shore as a result of engine failure which occurred at a point 16
miles from shore. The vessel was 7 miles from land when it rescued the crew of
the plane. The fishing vessel had at no time been within 12 miles of the Russian
shores until after its engine broke down. A few minutes after the plane' s crew
were picked up, a Soviet government vessel seizes the Danish vessel and all per-
sons on board, Danes as well as Americans, are arrested. All are held in Russia
for trial on charges of espionage. Neither American nor Danish protests result
in their release.

The dispute is placed on the agenda of the United Nations General Assembly.
The Soviet representative, in the debate, charges that the actions of the United
States and Denmark cannot be justified by the NATO treaty and that such treaty is
itself illegal, that Soviet territory was illegally invaded by the American plane,
and that the entry of the Danish vessel into Soviet water was also illegal.

Tirai Ix^cciraticr ir Lav <-c,. Seecri Scze;-.e: l>;:-5? Bags E

7cr your irfcrratict, tie Soviet supports lie principle tret its :err:::r^
- = -=rs exceto 12 riles frrr its ::s=:,

7c viae extent ices Soviet action involve e violation of the rigits of tie

tie validity of tie points reisei iy tie Soviet representative . :eref_lly con-
sider your srsver tc ie sure ciat vcu ieve ocverei ell tie issues raised "ry tie
aic-<

' *i ?3 -* +• !

15 -. Tie :iarter cf tie 5urect"curg trial cas

points It ias also ieer approved iy tie Asseoci

Is it la-- as tc ttt-ra-.'.fyi:; states viici ere tetters of tie 1'ritei
Nations; As tt non-ratifying setes Vnioi ere ret renters cf tie I'tctei Sacicrcs:

points 13-12 :er ---eels of tie vai.e cf 2-. ICC t: tie lecccral Ssclvays cf

Mexico, a Mexicer ctr~ iracicu. a ra'cricv cf tie st-cci of viici '.as

iy tie Vtitei States, iy ie:ree t::i possession cf tie Metrical Sailvays. 7ce

States. It 1923 a treaty -as resciei tetveer tie Vnitei States etc Mexioc estai-
listing a triiutel for tie settlerent cf tier tecicr^ : leers nerve en tie tvo
states.

Assure tiat ir i;2c tie licisct Irtrcary consults you es tc tie recovery cf :
3-.;:: tc tie 7scicral railways :f Mexico, teat ct es:i suei cccssict tie latter

, - *- .

„ -

tierefrcr eri i

else a suiscartiel ialarce it. its tare ir e }Te"-" icri iari.
if so. a~airst "-'t"r etc vcur ~ii=~iic~i ~~ success tieralr
cleir your client ray iave.

FINAL EXAMINATION IN INTERNATIONAL LAW (law 3U8)
Second Semester 1959-1960 Professor Looper

Instructions: There are five questions on this examination. It is
suggested that you spend about ^0 minutes each on the first four
questions, and about 30 minutes on the last question.

1. In 1950 the United States and Canada negotiated a treaty regulating the uses of
the waters of the Niagara River, particularly for power purposes. Article VI of
this treaty, for example, provided that, "The waters made available for power pur-
poses by the provisions of this Treaty shall be divided equally between the United
States of America and Canada." But the treaty did not deal with the question how
each nation was to exploit its share of the water.

The Senate Foreign Relations Committee recommended that the Senate advise and
consent to the ratification of the treaty, subject to the following reservation:

"The United States on its part expressly reserves the right to provide
by Act of Congress for redevelopment, for the public use and benefit,
of the United States' share of the Niagara River made available by
the provisions of the Treaty, and no project for redevelopment of
the United States' share of such waters shall be undertaken until it
is specifically authorized by Act of Congress."

The Senate unanimously gave its consent to the ratification of the treaty subject
to this reservation. The President ratified the treaty subject to the reservation
and communicated the existence of the reservation to the Canadian Government. The
Canadian Government, in its ratification, accepted the reservation.

But for the reservation, the Federal Power Act of 1920 would apply and the
Federal Power Commission could under this Act consider proposals and issue licenses
for diversion and redevelopment. In 1956 the Power Authority of the State of New
York (a state agency) applied to the Federal Power Commission for a license to con-
struct a power project to utilize all of the Niagara River water which, under the
1950 treaty, is available for American exploitation. The Commission dismissed the
Power Authority' s application, declaring

"In the absence of the treaty reservation we would act on the Power
Authority' s application in accordance with the provisions of the
Federal Power Act of 1920. But if we are to accept the injunction
of the reservation as it stands, we would have no authority to con-
sider the application of the Power Authority on its merits. ... We
are without authority to issue a license for the redevelopment."

The Power Authority brought a proceeding in the U. S. Court of Appeals for the
District of Columbia to review the Commission's dismissal order. How should the
case be decided?

/Cf . Power Authority of State of New York v. Federal Power Commission,
2V7 F. 2d 538 (19572/

2. Before World War II a man named Ahmedoglu made a deposit in your city in the
First National Bank, which is a regular commercial bank with its deposits insured
by the U.S. Federal Deposit Insurance Corporation. Ahmedoglu was a citizen of
Albania, which was then a monarchy. Early in 19^+5 a communist regime took control
of Albania and ousted the King. The United States Government has consistently re-
fused to give formal diplomatic recognition to the communist regime, although the
ex-King is not looked upon as the ruler and 0 negotiating mission was sent to
Albania for several months in I9U5.

Final Examination in International Law (Law 3^+8), Second Semester 1959-60 Page 2

In 19^+8 the communist Albanian government issued an order nationalizing all
property of certain classes of persons, including their property located outside
Albania. Ahmedoglu was included in the group. The bank has not heard from him
since the beginning of the war, but it has no reason to believe that he is dead.
This week a citizen of the United States appeared at the bank and exhibited documents
purporting to have been duly executed by officials of the Ministry of Finance of
the present communist government of Albania. These documents authorize the bearer
to withdraw the funds originally deposited by Ahmedoglu and subsequently expropri-
ated. The bank calls you in as their lawyer to examine the documents and advise
whether the funds may safely be paid to the bearer. The bank officials point out
that Albania was admitted to the United Nations in 1955, with the concurrence of
the United States.

Draft a memorandum advising the bank whether and on what conditions it should
pay the funds to the bearer of the Albanian government documents, with your reasons.

3. An airplane owned and operated by a privately owned corporation organized under
the laws of Mexico by Mexican citizens, and bearing the Mexican flag, was regis-
tered as a Mexican flag aircraft. While the plane was in the air over the water
about halfway between the mainland coast of California and Santa Catalina Island, a
disturbance occurred on the plane, resulting in the killing of one of the passen-
gers (a Puerto Rican) by another. The pilot in charge of the plane, fearing more
trouble, quickly headed for the nearest airport, which happened to be in Long Beach,
California. He radioed ahead, and municipal police officers were on hand to meet
the plane. They removed the man who had done the killing and took him to the local
jail. He kept shouting through the bars, "You can't do this to me'. I'm an American
citizen'."

What arguments would you make on his behalf in a habeas corpus proceeding?
What arguments would you make as prosecuting attorney in opposing the habeas corpus
proceeding?

Santa Catalina Island is about twenty miles from the California mainland.

k. In 19^2 Hans Bankburger was living in Germany, his native country. He owned
a considerable amount of property in the United States, and all of it was seized
in that year by the U.S. Office of Alien Property in the exercise of powers granted
in the Trading with the Enemy Act. In 19^6 Bankburger left Germany and took up
permanent residence in Brazil, where he duly became a citizen.

Beginning in 19^5 Bankburger tried to get possession of the property in the
United States. He wrote several letters to the Office of Alien Property, requesting
that they release the property, and even visited the United States once to try to
convince them to let him have it. They refused persistently and merely suggested
to him that he bring suit to test his rights. Finally in i960 Brazil instituted
a suit in the International Court of Justice against the United States, demanding
the property claimed by Bankburger, alleging that retention of the private property
of any individual under such circumstances is a violation of international law.

If ycu were an attorney in the Office of Alien Property in the Department of
Justice and were asked by your boss to prepare a memorandum In the next forty min-
utes, to be used in response to the State Department's request for the Justice
Department's views as to the procedural and substantive defenses available to the
United States, what would you write?

5. Write short notes on the following: (a) the jurisdiction of the Nuremberg
Tribunal; (b) jurisdiction over the continental shelf; (c) the status of Antarctica

tjJ3_J_Dt.Pr-Tiat-ior101 Iot.7

MIDSEMESTER EXAMINATION IN INTRODUCTION TO LAW (Law 315^
Second Semester 1959-1960 Mr. Brown

TOTAL TIME: 2 hours. Please allow 30 minutes to
each question.

I. Rudy Dixon left the key in the ignition and the engine of his 1959 Chevrolet
running while he hurried into the Hughes Dry Cleaning establishment in Urbana,
Illinois, to pick up a suit of clothes. He was not in the establishment more

than four minutes. While he was inside Jacob Whipple, with the purpose and intent
of stealing Dixon' s car, drove it off at high speed. Two blocks from the cleaning
establishment, while traveling 55 miles per hour in a 35~mile speed zone, Whipple
rammed the rear end of an automobile driven by Ruth Drummond, which had slowed at a
pedestrian crossing. Ruth Drummond died immediately as a result of injuries re-
ceived in the collision.

Illinois has a statute which provides, in part:

"No person driving or in charge of a motor vehicle shall permit it
to stand unattended without first stopping the engine, locking the
ignition and removing the key, . . .

"Every person convicted. . . for a violation of any of the provisions
of this Act . . . shall ... be punished by a fine of not less than
$1.00 nor more than $100.00; . . ."

Rudy Dixon was indicted in Champaign County, Illinois, for manslaughter. At his
trial before a jury the evidence revealed the facts given above. The jury found
him guiliyas charged, and he was sentenced to the penitentiary for a term of 1 to 3
years (the penalty for manslaughter in Illinois may be not less than 1 nor more
than ll<- years). On appeal from his conviction, what result? Why?

II. On Saturday morning Mrs. A went shopping at the X Department Store. Among
other things, she purchased three expensive imported linen handkerchiefs, which were
neatly packaged in a cellophane bag. After returning home she decided that she pre-
ferred another gift for the person she had in mind and, therefore, decided to have
her husband return the handkerchiefs the following Monday. Accordingly, on Monday
morning Mr. A went to X store. Since the handkerchiefs had been wrapped with the
other things and since they remained in the cellophane bag, he simply put the bag

in his coat pocket.

On arriving at X store Mr. A approached the handkerchief counter and pulled the
cellophane bag out of his pocket. It happened that the store was unusually busy at
the moment and he waited for fifteen minutes without attracting a clerk, whereupon
he decided to return at another time. He was just putting the cellophane bag back
into his pocket when a floorwalker saw him and approached. The floorwalker politely
asked Mr. A to see the saleslip on the handkerchiefs. Mr. A produced the slip which
ais wife had given him, but it turned out to be the wrong one, the proper one having
oeen left at home. The floorwalker then asked Mr. A to step into the office with
lim. Mr. A was embarrassed by this turn of events, and he hotly resented the im-
plication that he had stolen the handkerchiefs. He insisted that there was no reason
Tor going to the office. By this time a crowd had gathered around them. The
rioorwalker took Mr. A firmly by the arm and led him into the office. Mr. A did
lot resist. Mr. A was kept in the office for one hour while the store records were
searched. During this time he was allowed to call his wife. She became extremely
ipset by the incident. After one hour the store located its record of the sale,
ipologized profusely to Mr. A for detaining him, and told him that he was free to
eave .

Midsemester Examination in Introduction to Law (Law 315) Page 2

Mr. A was deeply humiliated by this experience, and Mrs. A alleges that she
has never been able to step into the X store again without feeling that both she
and her husband are regarded as thieves. She has become very morose over this,
and alleges that she now shuns even her friends because they too may feel that she
is dishonest.

Based on common- law principles, what rights, if any, does Mr. A have against
X store? Explain and indicate what you believe the results would be.

Assuming this series of events took place in Illinois, would the result be
affected by any statutes, and if so, how?

III. Farmer Fleece ran the following classified ad in the Champaign News-Gazette:

Will absolutely sell at auction my pair of prize two-year-old
mules, Kelly and Nellie. Sale to be held at Cornbog Estate,
Monticello, on March 10, i960, at high noon. Minimum bid $250.
F. Fleece.

Recondite McDrivel, a retired law professor and would-be farmer, read the ad and
appeared at Cornbog Estate at noon on March 10. He could find no one, man or
mule. Returning home, he promptly wrote Fleece this letter:

I will buy Kelly and Nellie for $250 cash, and will pick them
up at your place the afternoon of March 15, i960. I plan to
raise several species of livestock, including mules. Kelly and
Nellie sound like the starting breeders I need.

/s/ R. McDrivel

Fleece wrote back on March 11: "Accept your offer of March 10. I'll be looking
for you next Tuesday. For breeding, you will need a jackass, but I believe you
already have one." Fleece refused to complete the sale on March 15 . McDrivel
immediately threatened suit for breach of contract, and Fleece now consults you
regarding his legal rights and duties in the matter. You make inquiries on the
local mule market and learn that mules like Kelly and Nellie are sold every day for
$275 or more. Write a memorandum of your advice to Fleece.

IV. A statute of the State of Illinois reads:

"1. No bank, trust company, national bank, individual, partnership, unincor-
porated association or corporation other than a savings bank or a savings and
loan association shall make use of the word 'saving' or 'savings' or their
equivalent in its banking or financial business, or use any advertisement con-
taining the word 'saving' or 'savings', or their equivalent in its banking or
financial business, nor shall any individual or corporation other than a sav-
ings bank in any way solicit or receive deposits as a savings bank.

"2. No bank, trust company, national bank, individual, partnership, unincor-
porated association or corporation shall offer a safe deposit service unless
it shall first have applied for and received a permit from the State Banking
Commission.

"3- Any violation of the above sections of this Act may be enjoined and any per-
son or corporation found guilty of a violation of this Act shall be fined not
less than $100 or more than $1,000 and be imprisoned for not more than one
year in the county jail."

The Brightville National Bank, chartered by the Federal Government, advertises
as a "Savings Bank" and offers a safety deposit service without a permit. The
bank sues to enjoin the enforcement of the Act. What result? Why?

NAME NO .

MIDSEMESTER EXAMINATION IN JUDICIAL REMEDIES (Law 305)
November 10, 1958 Professor Stone

TIME: Fifty Minutes

PART I

INSTRUCTIONS

If you think that any further facts have to he assumed,
assume them and say what they are. If you think that
ambiguities exist, point them out, and resolve them in
some stated way, or deal with the question . on the basis
of alternative resolutions.

Please do not write anything except your name and action
on the cover page of the examination book.

"X- "X' x x

James and Wilson are citizens of the State of the Everlr sting
Harmon Law. Last July k Wilson asked James if he could borrow the James car so that
ne could drive his family to the local Independence Day celebration James con-
sented. Wilson used the car to drive his family to the celebration site. There
bhey met the Eenton family, who invited the Wilsons to stop by for refreshments
iftsr the celeoration. The Wilsons drove to the Eenton home, which wa^ several
niles cut of town, and, after a brief visit, re-entered the James car and started to
I~ive hcLe. On the way, a torpedo was thrown against the side of the car; it
?xploded with a long bang. Mrs. Wilson screamed. In an involuntary reaction to
zb.e two loud noises, Wilson twisted the steering wheel, and the car ran up over a
: -Thing and into the side of Snyder's house. Mr. and Mrs. Wilson both sustained
personal injuries. The Snyder house and the James car were damaged. Police
Investigation revealed that McDougald threw the torpedo.

Which, if any, ccmmcn-law remedies are available to any of the
)ersons named above, and against whom?

FINAL EXAMINATION IN JUDICIAL REMEDIES (Law 305)
First Semester I958-I959 Professor Stone

PART II

Write the answers to the following questions in the examination bool'.
Do not write any part of your answer on the first or second pace cf
the book, or of any additional book you may use; start writing on
page 3 of each book.

Begin each answer with a statement of your decision or your conclusions.
Discuss all points and issues involved, and give reasons fully, but
succinctly. If you think that further facts have to be assumed, assume
them and say what they are. If you think that ambiguities exist, point
them out and resolve them in some stated way, or deal with the question
on the basis of alternative resolutions.

1 and 2. George Bernard is the author of a play entitled "Coffee and CoTmisera-
tion," which deals in a thoughtful and non-sensational manner with the subject of
hcmo sexuality. He has entered into a contract with Lewis Wayward whereby Wayward
will produce the play on the stage and otherwise exploit it commercially, and
Bernard will become entitled to certain royalties based on receipts frcm stage,
motion picture, and television production. Wayward has engaged a steff and
actors, the sets have been built, and rehearsals are well along. Wayward has also
entered into a written lease with Hubert, the owner of a theater, covering the
first six months of what is hoped will be an extended stage run.

With first night a week away, the local District Attorney has stated
publicly that in case the play opens, he will prosecute all concerned, including
the theater owner, for violation of the state "obscenity" statute. This statute
reads in part:

"Any person who as owner, manager, director, or agent, or
in any other capacity, prepares, advertises, gives, presents
or participates in any obscene public performance or enter-
tainment shall be guilty of a misdemeanor . . ."

After this announcement was made, Hubert sent notices to Bernard and to Wayward
calling attention to a provision in the lease entitling Hubert to terminate it
without prior notice, and without further liability of either party to the other,
in the event that the lessee "uses the premises to present an obscene performance.''

Bernard and Wayward have informed you of the foregoing facts and request
your advice. Advise them as to what alternatives they have; what judicial or
other remedies either might have, against whom and why; and the advantages and
disadvantages of each alternative.

3- Having been a l6-letter man in high school, Joe Blow was considered quite a
catch for those who recruit college athletes. Ox College apparently won the
competition. In addition to the financial aid permitted by the rules of the
National Collegiate Athletic Association and of the Conference to which Ox be-
longed, Blow was surreptitiously given regular payments for doing his homework,
and he was promised and was given a key to one of the Ox Athletic Association
station wagons which was never used for official business after 5 p.m. or on week-
ends. Blow reciprocated by performing magnificently in three sports daring his
first two years in "college."

Last year Howard Battem, the Ox baseball coach, resigned his position to
join the staff of the Fugwash Midgets, a professional baseball team. Shortly

Final Examination in Judicial Remedies (Law 305), Part II, First Semester 1958-9

Page 2

thereafter, in response to an offer of a large bonus payment from Battem, Jon
Coup, a star Ox athlete, left college to play professional baseball. Coup had
received thousands of dollars in aid and gratuities from Ox and its alumni, and
his departure before he had played the full three years of varsity baseball angered
Ox athletic officials. They were only slightly mollified when the Pu^wash Midgets
made a $500 contribution to the Ox Athletic Association's Scholarship Fund.

Battem has just reappeared in Oxville. He has been seen carrying a check-
bock and talking to Blow. Last week Blow stopped going to classes, began packing
his belongings, and shopped for a Rolls-Royce automobile. Ox's president nonsuits
you as to how to protect the investment in Blow. Advise him.

h. W, an Urbana watch-repairman, has received from P, a Champaign pawn-shop opera-
tor, 2 group of 12 watches which P has ordered W to repair and refurbish tj make
them more salable. At the same time/ W sent over for repair his personal \>/ristwatch,
which he had purchased for $U00 in Switzerland in 1950. The latter watch now sells
for core than $1000 in New York and Chicago stores.

While repairing the watches, W noticed an inscription on one of the.ii which
identified it as a souvenir watch purchased by his father at the San Francisco
Exposition of 1915- When W was a boy, his father had promised to give him this
watch when he reached the age of 21, but his father had lost the wptch before he
died in the '30's, while W was still in high school.

W then offered to buy the watch from P for $25, which is more than P could
get for it elsewhere. P refused the offer, whereupon W declined to return any of
the watches unless P would sell him the souvenir.

P seeks your advice. He further informs you that the reason that he will
not let U buy the souvenir watch is that he, P, erred in sending it out for repair
before the redemption period expired, that the pawnor has demanded its return, and
that P might lose his pawn-shop license if he fails to redeem a pawned item upon
tender of the amount owed thereon. Recommend a course of action to P. carefully
explaining why you prefer it to any alternatives which may exist.

NAME - NO.

MIDSEMESTEB EXAMINATION IN JUDICIAL REMEDIES (Law 305 )
December h, 1959 Professor Stone

TIME: Fifty Minutes

PART I

INSTRUCTIONS

If you think, that any further facts have to be assumed, assume
them and say what they are. If you think that ambiguities exist,
point them out, and resolve them in some stated way, or deal with
the question on the basis of alternative resolutions.

Write the answer to Part I in the examination book. Please do not

write anything except your name on the cover page; start writing on

page 3-

* * *

A car belonging to Paul Hays, a citizen of the State of Everlasting Common
Law, broke down whUe ne was driving along a highway in that State. A cruising
police patrol noted his plight, and by radio called to his aid a truck manned by
two employees of the ABC Auto Repair Company, a local corporation. When the truck
arrived, Hays said, "I think it's gasket trouble."

Employee A said, "Let's have a look." They looked.

Then Employee A said, "Yep, it's a gasket. We'll have to take it in."
Hays scowled.

They towed the car in, worked on it, repaired it, and then presented him
with a bill for $175-00. Hays said, "This is highway robbery. I won't pay such
an outrageous bill."

The ABC employees then refused to allow Hays to take the car, whereupon
he came to see you, a local lawyer. Hays wants the car now.

(a) Explain to Mr. Hays what judicial remedies might be available to him
and why. (Your state does not recognize artisans' liens.)

(b) After you have finished explaining to Mr. Hays, he receives a tele-
phone call. The manager of ABC informs him that they will not continue to hold
the car, but that the amount of the bill will not be changed. "I'll get the car
right away," says Mr. Hays, "but if I refuse to pay that awful bill, what can they
do to me?" Tell him (in terms of judicial remedies).

Name ! fc .

FINAL EXAMINATION IN JUDICIAL REMEDIES (Law 305)
First Semester 1959-1960 Professor Stone

TIME: h HOURS

PART I

Write the answers to the following questions in the examination book.

Do not write any part of your answer on the first cr seocnd page ::
the book, or of any additional book you may asej start writing on
page 3 of each book.

Begin each answer with a statement of your decision or ycur conclusions.
Discuss all points and issues involved, and give reasons fully, but
succinctly. If you think that further faces have to be assumed, assume
them and say what they are. If you think that ambiguities exist, point
them out and resolve them in some stated way, or deal with the question
on the basis of alternative resolutions .

* * *

1. M. Lucien was imported to cook exclusively for the Rive Gauche, a Washington
restaurant. His contract provided that he would serve the Rive Gauche for five
years, and would not act as chef for any other employer luring that period. The
management accused him of jumping his contract and removing himself to -he kitchen
of a rival restaurant, the Cordon Bleu. The Rive Gauche obtained a Terrperary
restraining order to prohibit M. Lucien frcm practicing his art for the Ccrier.
Bleu.

a) M. Lucien made a motion to dissolve the temporary restraining order.
What ruling? why?

b) The Rive Gauche charges that while the temporary restraining crier
was in effect, M. Lucien illegally cooked a souffle; moreover, that he was seen
to add a pinch of something to another dish. A policeman who happened to be in
the Cordon Bleu kitchen on business testified in support of the charge. There
was no denial. The Rive Gauche asks that K. Lucien be held in contempt. What
ruling? Why?

c) After disposition of the foregoing, the zc rt is asked for a permanent
injunction against M. Lucien. Should it be issued. If so, what should its terms
be? Why?

(After the examination, compare editorial, Chicago Tribune, Monday, January
18, i960, p. 20, col. 2.)

2. An opinion rendered by Judge Xam in the case of Parker v. Garrison begi
with the following statement:

"The bill alleges that John T. Parker, about the first of Februa .

agreed to sell a tract of land to Lewis Garris en for i±62Q, 1: be paid
in instalments, with interest; that nothing was paid on the peer chase,
but Garrison went into possession of the land, and raised a crop of
corn thereon; that, having failed, and being unable to pay z'za first
instalment falling due, Garrison prevailed on Farker to release him
from the purchase, with the agreement that Parker should treat him as

Final Examination in Law 305, Part I, First Semester 1959-60 Page 2

a tenant, and receive from him, for the use of the land during the year,
one-half of the crops raised on the land, to be paid in corn; that
Garrison raised on the premises three thousand bushels of corn; that
Garrison hauled to Manteno and delivered to Adam Sockie about six
hundred bushels of the corn, and stored the same in his own name, and
was hauling the remainder to him to be stored in the same manner;
that Sockie refused to let Parker have the corn or to pay him for the
same, and that Garrison is insolvent, and intended to defraud com-
plainant out of his rent. The bill makes Garrison and Sockie defendants,
and prays that Sockie be restrained from delivering the grain to, or
paying Garrison therefor, and that Garrison be restrained from selling,
mortgaging, pledging, etc., the grain.

"To this bill a demurrer was filed, which the court sustained and
dismissed the bill, and the complainant appeals to this court."

Complete the opinion for Judge Xam.

(After the examination, compare Parker v. Garrison, 6l 111. 250 (1871).)

3. When attorneys Farley and Granger dissolved their law partnership, they
signed an agreement which included the following provisions, among others:

a) When and if Zoom, Inc., an impoverished but promising client, should
ever choose to show its gratitude for past indulgences as to fees
by issuing seme of its stock to either of the partners, the op-
portunity should be shared equally by both.

b) When and if any dispute should arise concerning the agreement, it
should be submitted to arbitration before a board consisting of one
arbitrator nominated by each lawyer, and a third nominated by the
president of the local bar association.

Granger has heard that Zoom, Inc., has sold Farley 1000 shares of its stock at
$5 a share, a price which is substantially below the market price of the stock,
and has issued him certificates therefor. Too busy and too wise to act as his
own lawyer, Granger consults you as to what he can and should do in the situation.
Advise him. (Your state has no legislation on the subject of arbitration.)

Page 2

NO.

FINAL EXAMINATION IN JURISPRUDENCE (Law 351)
First Semester 1958-1959 Professor Carlston

PART I

IMPORTANT: You will find a number in the upper right-hand corner of this page.
This will be your examination number. Grading will be made without knowledge
of your name. A list of the members of this class will be passed around.
Place your examination number in the space opposite your name on this list.
Do not write your name on either this question sheet or the examination booklet.

You are supplied with two booklets in which your answers are to be
written in your own handwriting. You will use your natural style of writing,
i.e., do not write in small characters in order to get more words on the page.
You may use only these books for writing your answers.

1. Discuss the social function served by property, contract, tort, and criminal
law.

2. (a) Would a stable society be able to function if its law were limited to

the fields listed in Question 1?

(b) Would a stable society be able to endure without legislation?

3. List the ideas and questions which are s-^gested to you by the material under
heading V on pages 816-819 of the text. Such ideas and questions should be
those which seem to you to be significant in the light of the understanding
of law generally, as well as the meaning of property, which you have
acquired from this course.

::

NO.

FINAL EXAMINATION IN JURISPRUDENCE (Law 351 )
irst Semester 1958-I959 Professor Carlstcn

PART II - Hohfeld Jurisprudence
(One Hour Allowed)

MPORTANT: You will find a number in the upper right-hand corner of this page.
This will be your examination number. Grading will be made without
knowledge of your name. A list of the members of this class will be
passed around. Place your examination number in the space opposite your
name on this list. Do not write your name on either this question sheet
or the examination booklet.

State concisely in Hohfeldian terms the legal relations involved in
the following two cases, translating to the extent possible the state-
ments made into Hohfeldian description. If you are in doubt in any one
situation, indicate your opposing choices and state why you hrd diffi-
culty in selection of the appropriate category.

L. A was the owner of an RCA-Victor television set which was located in bis hcr.e
Ln Champaign. The set was out of order. A called X, a television engineer, to come
co t^e hour.e and repair it. A gave X his address, a description of the set, and
told him that he and his family would be out of town for the approaching week-end,
out that he could enter the house by use of a house key which would be left with
the ncxc-docr neighbor. He could accordingly do the work while the family was away.

B, a university student, roomed at A's house. Unknown to A, B had pur-
chased a used RCA-Victor television set, very similar to A's set. This set was als>-
in A's house, in B' s room, which was on the first floor. B1 s set was out of order
when he purchased it, but he intended to repair it himself. B also left town for
jthe Thanksgiving vacation. Luring the absence of both A and B, X entered the house,
but, without seeing A's television set, by mistake repaired B' f set. The mistake
was not discovered until a few days later when A received a $Uo repair bill from
X, $15 of which was for parts and $25 for labor. X, informed of the mistake, then
hilled B for the $1+0. Both A and B refused to pay.

2. In 1925 D leased a tract of grazing land from A for a term of 25 jears. In
1926, to secure water for his cattle on the leased tract, D laid a pipe to a natural
spring on P' s adjoining tract and pumped water therefrom. P protested to D a number
of times about the taking of the water and even threatened suit, but did nothing
more. D continued the use of the water. At the expiration of D' s lease, D purchased
the leased land from A. In 195^ P brought a suit again.:t D to enjoin the taking of
water from the spring.

'

■

NO.

FINAL EXAMINATION IN JURISPRUDENCE (LAW 351)
First Semester 1959-1960 Professor Carlston

PART I

IMPORTANT: You will find a number in the upper right-hand corner of this page.

This will be your examination number. Grading will be made without knowledge
of your name. A list of the members of this class will be passed around.
Place your examination number in the space opposite your name on this list.
Do not write your name on either this question sheet or the examination
booklet .

You are supplied with two booklets in which your answers are to be
written in your own handwriting. You will use your natural style of writing,
i.e., do not write in unusually small characters in order to get more words
on the page. You may use only these books for writing the final answers
to the questions.

V V Y
*. R A

Prepare an outline of this course, as we have so far covered it, under three
headings: (l) the ends of law; (2) the growth of law in society; and (3) the
nature and structure of law. This is to be a topical outline, that is, with
headings I, A, 1, a, etc. You may include short explanations or statements
wherever you find it desirable. Do not obviously borrow from any outlines of
topics furnished you in this course. It would be preferable not to adopt
literally the chapter headings for the entire book; for example, you might want
to combine some chapters. Again, you might want to shift topics or ideas as
they were taken up chronologically in the course to another place where you
believe they would logically fit in your outline. You will be graded on the
clarity and comprehensiveness of your outline and the degree to which it shows
you have absorbed and understood the course. The materials on which you will
be graded will be the text and the ideas developed in class discussions and
lectures.

FINAL EXAMINATION IN LABOR LAW (Lav 3^7)
First Semester 1958-1959 Professor Fleming

TIME: 3 1/2 HOURS

I. X department s+ore, which is located on the state line in Distill City, employs
30 clerks. The store handles merchandise from all over the world and does ar. excej -
lent business. Z union decided to undertake the organization of X' s 80 c]^rks.
Planning its organi^.ng campaign carefully, Z sought and obtained fiom other local
unions Jae names and addresses of wives or relatives of union members working in the
store who might be favorable to the union. From among this group io then recruited
a nucleus who agreed to push for the organization of a union in X.

Z's second step was to assign a representative to distribute union leaflets
to employees as they came to i"ork in the morning and as they left in the evening.
This was not very successful because X is located on a busy street corner v/here it
was difficult to identify which persons were employees, and because the city requires
as a condition for permitting distribution of leaflets that the distributor agree
to pick up all discarded paper so that the streets will ho clean. At the same time
that outside distribution of union literature was being made, the nucleus of union
members in the store attempted to distribute similar literature inside the i tore
just before work began in the morning and just after it closed in the evering.
Company supervisors promptly adv: sed them that distribution of any kind of litera-
ture on company time or property was forbidden by express rule enacted originally
in connection with charitable drives in the community. Thereafter, Z union offic-
ially requested permission to distribute leaflets by the above method but was
denied permission by the company.

While the above campaign was taking place, store executives made two counter-
moves. First of all, they called in employees in groups of ten for a chat with the
store manager. In the course of the conversation employees were r;njund<=d of what a
happy family they had been without "outside" interference, and advised that a union
could do them little, if any, good. On the other hand, it was made clear th9.t em-
ployees were entirely free to do as they pleased about joining the union and there
TOuld be no retaliation. The manager then suggested that it would be help^i for him
t» know about how many employees were interested in a union. He proposed that em-
ployees vote "yes" or "no" orally while he turned his back. This, he said, would
give him an idea of the interest without permitting him to identify individual votes.
His request was carried out and there was just a sprinkling of votes for the union.
4s a second step, the store, during working hours, assigned a supervisor uo dis-
tribute daily bulletins to employees containing extracts from the hearings of the
4cClellan Committee relating to union abuses.

At the same time the local newspaper, with which X had no connection, took up
the fight against unionization and carried on a vicious campaign designs to com-
pletely discourage employees from organizing. X occasionally posted excerpts from
the newspaper on its bulletin board.

At about this time Z decided that its best strategy would be to resort to
Peaceful picketing of the store. Because it did not have a majority of the employees
enrolled, it first advised the store by registered letter that it was not seeking
'eco^nition and that the picketing was purely organizational. The picket rigns were
carefully phrased to make it clear that the union did not seek recognition.

Eased on the above facts answer the following questions:

1. Z alleges that X is guilty of various unfair labor practices. What
iractices, if any, are unfair, and what should the ruling be?

Final Examination in Later Law, Law 3U7, First Semester 1958-1959 Page 2

2. X alleges that the union is guilty of unfair labor practices. What
practices, if any, are unfair, and what should the ruling be?

3. X asks the NLRB to order an election in order to determine whether the
union represents its employees. What ruling and why?

h. Assume that the NLRB orders an election. The union wishes to appeal
the order. May it do so, and if so, on what ground?

5. X goes into the state court asking for an injunction against the picket-
ing and damages for the loss of business it has suffered through the picketing.
What ruling in the state court and why?

II. X union and Y company entered into a collective bargaining agreement, which con-
tained neither a no-strike nor an arbitration clause. It did, however, include

a paragraph which read as follows:

"When an employee is required to fill the place of another employee
receiving a higher rate, he shall receive the higher rate."

Employee C was required to fill the place of another employee in a higher
rated job. The job in question carried two rates, one for the probationary employer-
and the other for the regular employee. Both rates were higher than C's regular
rate. The company paid C the probationary rate. Thereupon C grieved, clar^ng that
under the terms of the contract he was entitled to the permanent rate when required
to fill temporarily the job of another employee. The grievance was discussed by
company and union representatives and they were unable to agree. The union then
struck .

On this set of facts, and assuming that Y is engaged in interstate commerce,
answer the following questions:

1. What relief, if any, could the company obtain from the National Labor
Relations Board? Explain.

2. Could the company maintain an action for an injunction and/or damages
in a federal court? Explain.

3- Could the company maintain an action for an injunction and/ or damages
in a state court? Explain.

h. Assume the union did not strike, but brought an action for specific
performance and damages in the federal court. What result, and why?

5- If the above contract contained both a no-strike and an arbitration
clause, in what way would your answers to the above questions be affected?

III. Mr. A was interested in getting into the dairy business. Toward that end
he studied the market conditions in Podunk for some time. Among otner things he
observed that no milk was offered for sale in paper containers, and that retail
sales in stores were small as compared with sales by home delivery. He kne,r that
in order to create large volume sales through retail stores, it was necessary to
use paper containers and to sell the milk to consumers for at least 2 cents "ess
than they would pay for home delivery. After satisfying himself that there was a
inarket of the above type in Podunk, Mr. A started in business, hauling all of his
milk from across a nearby state line. He sold only at wholesale, principally to

Final Examination in LaVor Law, Law 3U7, First Semester 1958-1959 Page 3

supermarkets, and the sales were in large volume to relatively few outlets. At the
time Mr. A entered business in Podunk there were three other dairies, X, Y, and Z,
serving the city. The employees of all these dairies were represented by the union,
and all were bound by a common contract which the dairies negotiated through a
Eairy Association. Mr. A joined, the Dairy Association and became a partv to the
contract with the union.

Two years after Mr. A joined the Dairy Association, the union male a new
proposal with respect to pay. As in the past each driver would be paid a base
salary, with a commission based on points calculated on the sale of the product.
Because Mr. A sold to the supermarkets in such large volume, his drivers accumulated
points far beyond those achieved by drivers for the other dairies. The union pro-
posal with respect to commission points was on a graduated scale. To illustrate:
no commission would be paid for the first 12,CC0 points; 1 cent per point for the
range between 12,000 to 20,000; and, at the top of the scale, h cents for points
over 30,000. Only Mr. A would have drivers in the top bracket, and their earnings
were already running as high as $17,500. Mr. A charged that the effecc of the
proposal was either to force him out of business or to force hii to split Lis routes
since the U-cent rate was prohibitive. The union argued that the purpose of the
provision was to ease the heavy loads which were damaging the health of A's drivers,
and to provide more jobs for union men by route- splitting. It was also conceded
that the drivers for other dairies were jealous of the amounts being earned by A' s
drivers, and that route- splitting would reduce the individual earnings of A's
drivers.

When the union made the above demands in bargaining, Mr. A withdrew from the
Dairy Association. Thereafter he was absent at negotiations which, however, made
no progress. Finally the union reached an agreement with X dairy, and thereafter
each of the others signed the same agreement. Minor modifications were t.ade in the
original demands. Mr. A signed under protest, but sought and obtained an additional
sixty days within which to purchase additional trucks and plan the necessary
route -splitting. After the contract was signed, Mr. A brought an action for
treble damages against the other dairies and the union, contending that Section 1
of the Sherman Act had been violated.

What will the arguments of the respective parties be, and what result would
you expect?

IV. X is a licensed, over-the-road, trucking firm which has a long-established
collective bargaining relationship with Y union. For the past several years the
contract has contained a clause stating that X will not require members of the Y
union to handle non-union goods.

Z mousetrap company hires X to transport all of its mousetraps to whole-
salers all over the country. Z is unorganized and Y now decides that ofae time has
come to attempt to bring Z's employees into the union. Toward this end Y places
a single picket outside Z's premises with a sign stating that Z is unfoir to
organized labor. Y also circulates Z's name to all affiliates with a notation
that Z is unfair. When X' s employees, who are members of Y union, see the picket
in front of Z's premises, they refuse to cross the picket line. Instead they
promptly notify X of the situation and remind him of their contractual agreement
that employees do not have to handle non-union goods. X responds that despite hie
!agreement with the union, he must insist that his employees load and transport Z's
.mousetraps. The employees refuse and X then fires them for insubordination. This
causes the union to strike. On this set of facts answer the following questions:

1. What possibilities of legal action are open to X? Explain.

2. What can Y do? Explain.

3. What can Z do? Explain.

Oil

Final Examination in Labor Law, Law 3^7, First Semester 1953-1959 Fage k

V. X industrial union wants to organize the Y farm equipment company, which is
engaged in interstate commerce. Y is a typical large manufacturer of farm equip-
ment, losing assembly line methods. X seeks a unit which will encompacs all pro-
duction workers, including the patternmakers. The latter are highly skilled
employees who serve a substantial apprenticeship. They work in a sepa~at° part of
the plant, which is nevertheless located in the production space. There is a
patternmakers union of long standing to which at least seme of the pattertnaKers
at Y allege they wish to belong. Finally petitions for an election are filed by
both X and the patternmakers. How should the NLRB treat these petitions?

Assume that X is ultimately certified for an agreed-upon production unit.
X and Y then enter into negotiations. Y is located in a semi -rural! area where a
majority of its employees are part-time farmers. For this reason they strongly
desire a clause in the collective bargaining contract which will permit them to
have both a priority in purchasing the new small tractor which the company is pro-
ducing, and a 20$ price rebate in making the purchase. Y absolutely revuser to
discuss this demand but it willingly enters into negotiations on all other subject-.
Finally agreement is reached on all items except the one listed above. The union
then refuses to sign an agreement without some clause on employee purchase rights,
and the company refuses to discuss the matter at all. The union then strikes to
enforce the demand.

During the strike the company decides to try to continue to operate. C, who
is an employee of the company and a member of the union, voted against the strike
and he therefore decides to cross the picket line. As he approaches the plant,
seme of the pickets see him and begin to direct toward him epithets which are of
an extremely coarse and uncomplimentary nature. A few pickets even spit in
his direction. At that point C remembers pictures in the morning paper cf develop-
ments in Cuba with respect to seme of Batista's followers and he decides to go
home.

Luring the course of the strike the company hires a number of replacements
for s+.rikers. Finally the strike is settled without a purchase clause of the type
sought by the union. The contract dees include a valid Taft-Hartley union shop
agreement .

Based on the above facts, answer the following questions:

1. What, if anything, can the union do about its demand for priority and
rebate rights as to the purchase of tractors? Explain and state your conclusions.

2. What, if anything, can C do about his claim that he remained away from
work because of the picket line? Explain.

3. What, if anything, can employees who were replaced during the strike do
about getting their jobs back? Explain.

h. If the union expels C for conduct detrimental to the union during the
strike, what, if anything, can it require the company to do about C under the
valid union shop agreement?

FINAL EXAMINATION IN LABOR LAW (LAW 3U7)
First Semester 1959-1960 P ofessor Fleming

TBffi: 3 1/2 HOURS

I. X union undertook to organize the employees of Y steel company. Y vas clearly
engaged in interstate commerce. While the union was organizing, the company
announced that the annual Christmas bonus would not be paid if the union won be-
cause inefficient practices promoted by the union would reduce profits. The company
also posted daily extracts from the McClellan Committee hearings with respect to
criminal practices in certain unions. During one week employees received two checks
which totalled the same amount as the usual single check, but with a letter indicat-
ing that the smaller check would have to be contributed to the union in the form of
dues if it won the election. Finally, in the last week before the election, the
manager called in employees in groups of 25 for a little chat in which he stressed
the "homey" atmosphere of the plant without any outside union. Is there anything
the union can do about any of the above practices?

Assume that an election was finally held and that the union won. Thereafter
bargaining began but the parties were unable to reach an agreement and a strike en-
sued. The company decided to keep the plant open and to hire replacements. Employ-
ees A, B, and C, all of whom held office in the local union, were convicted of
throwing rocks through the windows of employees who were going to work and were
fined $25 each.

After the strike had been on for one month the company announced tnat it would
refuse to pay Christmas bonuses to any employees who did not return to work within
the next week since the strike was reducing profits and it felt that only those
employees who were working deserved such a bonus. The union responded with an un-
fair labor practice charge. What will the NLRB rule and why?

One month later the union offered to return to work without a contract, but
the company refused to reinstate A, B, and C on the ground that they had led the
strike, and so the dispute continued. The union filed another unfair labor practice
charge against the company. What will the NLRB rule and why?

Thirteen months after the strike began, an employee who had returned to work
filed a petition for a decertification election and accompanied it with a 30$ show-
ing of interest. Will the NLRB order an election, and, if so, why. If there is a
decertification election, who will be eligible to vote?

II. X union was attempting, without success, to organize the Y shoe company. In
order to put pressure on Y, X posted pickets at the factory and in front of the
customer entrances of Z department store where Y's shoes were sold. The picket
sign at the department store read: "Please do not buy Y shoes at this store. They
are made by unorganized workers." X also published a full page ad in the local
newspaper asking customers not to purchase Y's shoes at the Z store. Despite these
steps there was no evidence that Z's employees were refusing in any way to display
or sell Y's shoes. Z is part of a national chain of stores. The particular store
in question does a business well within the NLRB's jurisdictional standards. It is
a leased site in a Shopping Center owned by W. W retains control of all the side-
walks on the site. The union pickets were necessarily walking on V."s property. W
advised the union that he had no interest whatsoever in the labor dispute with Y,
but that he would bring an action in trespass against the union unless the picket-
ing ceased forthwith.

Final Examination in Lav 3'+7 > First Semester 1959-1S Page 1 .

Can '.' maintain a trespass action against X. Explain.
k. '.That course of action, if any, is open to Y as against X? Sxplac...
3- What course of action, if any, is open to Z as against X." JLxtlaia .

III. The Beanpole Construction Co. is a national organization which bids on major
construction projects all over the country. After being awarded, a $7, ICC, IOC con-
tract in Philadelphia for the construction of a Sports Falace, Beanprle signed a
contract with various building trade unions requiring all employees in the respec-
tive skill classifications to join the unions as a condition of employment, within
seven days of the date of the agreement. The contract also provided that the unj
would be the sole and exclusive source of referrals of applicants for employment,
and that the union would refer without discrimination as to membership in the

but on the basis of past experience with this employer.

Beanpole's contract with the Plumbers' -anion contained the following clause:

"The Company agrees not to require any plumber or pipefitter
to install prefabricated pipe unless such pipe is more than
two inches in diameter, in which case it may be prefabricated
off-site provided the work is performed at building trades
rates under an agreement with a local union of the United
Association of Journeymen and Apprentices of the Plumbing ai
Pipefitting Industry."

After construction had started, District pC of the United Mineworkers Union
started soliciting members from among the various tradesmen, all of ■:..:::. were
covered by one or another of the building trades agreements. District % finally
asked the NLPJ3 for an election and made the appropriate 30$ shoving. While the
construction project was in progress a dispute arose between the Cement Finishers
and the Carpenters as to which group should dismantle forms used for pouring con-
crete. Both unions were signatory to the AFL-CIO jurisdictional agreement and the
question was submitted to the Joint Beard for decision. An award was made in favor
of the Cement Finishers, but the Carpenters refused to accept the award.

1. Is the compulsory membership clause between the Beanpole Co. an
building trades 'anions valid? Explain.

2. Is the fabrication clause between Beanpole and the Plumbers' unic valid
Sxplain.

3- Will the NLRB grant an election to District yC": y or way aot?

h. "hat can the employer do to end the jurisdictional dispute "
Cement Finishers and the Carpenters?

IV. Fifty of the fifty-five filling stations in Middletc-.r were organized by the
Teamsters union. Since the five unorganized stations continued to cut

pay substandard wages, the 'onion was under great pressure to organize them, fe spite
its best efforts, it was unable to do so because the employees in question refused
to join the union. Thereupon the union picket I wil th result that deliveries to

Final Examination in Lav/ 3V7, First Semester 1959-1960. Page 3.

the five stations were cut off. The union notified the station owners by register-
ed mail that the union did not desire recognition and that the pickets were there
solely for organizational purposes . There was no violence and the picket signs
were truthfully and appropriately worded.

Assuming the NLRB will take jurisdiction, what remedy, if any, do the five
filling station operators have?

Assuming it is not clear whether the NLRB will take jurisdiction, what remedies
do the five operators have?

Assuming NLRB jurisdictional standards are not met, and the state statute reads
as follows, what remedy, if any, do the operators have?

"No restraining order or injunction shall be granted by any
court of this State, or by a judge or the judges thereof in
any case involving or growing out of a dispute concerning
the terms or conditions of employment . "

Suppose that in the next bargaining session for a new contract the fifty fill-
ing stations form an association which represents them in bargaining. In order to
hold its own members in line on prices and wages, the association insisted upon in-
clusion of the following clause in the new contract:

"The Union agrees that upon being advised by the Association
that any member of the Association is engaged in unfair trade
practices, union members will refuse to perform further ser-
vices for said employer until such time as the unfair trade
practices are discontinued."

All other terms of a new contract had been agreed upon, but the association
was adamant as to the inclusion of the above clause, and the union refused to
accede to it. The union then filed an unfair labor practice charge, contending
that the association was not bargaining in good faith. Assuming the NLRB takes
jurisdiction of the case, how will it dispose of the unfair labor practice charge
and why?

V. The Stretch Rubber Co. is an integrated industrial plant which has a twelve-
year bargaining history with the Rubberworkers union for all production and main-
tenance employees. Some of the maintenance painters in the plant were dissatisfied
with the rate differential they were receiving. They contact the Painters' union
with the result that the business agent for that union shortly had 30$ of the main-
tenance painters enrolled in the union and he petitioned at an appropriate time for
an election . Both the company and the Rubberworkers union opposed severance of the
painters from the over-all bargaining unit. VJhat factors will the NLRB take into
consideration in deciding whether to grant the Painters' petition? 'Jhat result
would you expect, and why?

Suppose the NLRB granted the petition and ordered an election. Could the
Stretch Co. or the Rubberworkers go into the federal district court and get an
order restraining the NLRB from conducting the election? If so, on what ground?

Seneseer L< f ' -ig

;
heir. ; : .. ; ;i ; _; c:~
- . -.re ': ereci'
::_-...: ar.i a :
signei; che ur.icr. a
clothing alic--ar.ee
that the contrace w
and chae -he iee ■=
tract expired. Can
against che ccnpar.y

: ir. che next negotiation the - kersj

: an cr_g its painter neanberSj - Mr.

. _ . - ant spe ;ial :

- signed vi-chou* them. After the ;octraet
that it wished tc bargain over a special
ir.~: effect imedia-ely. Ire pany claa

.: jeec ;: fec-cher cer.efi.e for the painters
ice : .__ not be raised jmtil the present :. -

- p

eve ::/ sever

errrine e

suppose X
ers in their m
tending to und
agair.se hire, v
a hearing "cefc
the Stretch Te
the contract rec-iree oezdbej
if the company discharges hel
and if so, for what

:ne rurcer-

lco, But : led ere racr.c-

iscip-rinec ." . ervca : . activity

advised registered nail ::' e = charges

to discnar.ee him since re »as n: lenger 2 ehe _nien ani

union. Hhat recoursej e: . LU X have

lave ;f =:::::. against the i

NAME No .

FINAL EXAMINATION IN LAW AND SOCIETY (Law 383)
First Samester 1958-1959 Professor Locper

INSTRUCTIONS

1. You have 3 l/2 hours for this examination, of which a good part
should be spent in thinking rather than in writing.

2. The examination consists of two parts: Part I is short answer
and Part II is essay. The time allocation is roughly: Fart I,
1 1/2 hours; Part II, 2 hours.

3- In Part II, there are four essay questions of which ycu are to
choose two (one out of each pair). Thus about an hour for each
question is allowed. Organize ycur answers; don't madly fling
yourself on a steed and go galloping off in all directions.

4. Part I consists of twelve quotations. On the lined spaces, you
are to identify each quotation and give a brief explanation of
its meaning in context. Perception is here as important as memory.
If you cannot recall exact authorship, don't hesitate to say whom
it sounds like and what you think the quotation means.

The following example may be suggestive of what is wanted:

Q.: "The prophecies of what the courts will do in fact, end nothing
more pretentious, are what I mean by the law."

A.: This statement occurs in the early part of Holmes's "The Path of the
Law." In the first part of this essay Holmes is attempting to dispel the "confusion"
between morality and law. For this purpose he enunciates the "bad men" theory and
asserts that legal analysis should be concerned with the prediction of the inci-
dence cf the public force through the instrumentality of the courts. This

litigation-oriented "predictive theory" of law is perhaps the basic premise of

American "legal realism."

•

Final Examination in Lav and Society, Lav 383, First Semester 1958-I959 ?sg3 2

PART I

1. "Questions of ultimate ends are not amenable to direct proof ... We are not
however, to infer that acceptance or rejection (of an ultimate end; must depend on
blind impulse, or arbitrary choice."

2. "The gsuealogy of legal myth-making may be traced as follows: Chi1 dish dread
of uncertainty and unwillingness to face legal realities produce a basic legal myth
that law is completely settled and defined. Thence springs the subsidiary myth
that judges never make law. That myth, in turn, is the progenitor of a large brood
of troublesome semi -myths."

3- "The books are full of schemes of natural rights. There are no schemes of
public policies."

Page

Final Examination in Law and Society, Law 3^3 Page 3

h. "A norm is not valid because it is efficacious; it is valid if the order to
which it belongs is, on the whole, efficacious.'1

5. 'The object of this Essay is to assert one very simple principle, as entitled
to govern absolutely the dealings of society with the individual in the way of
compulsion and control, whether the means used be physical force in the form of
legal penalties, or the moral coercion of public opinion."

3. "The word rights, the same as the word law, has two senses: the one a proper
sense, the other a metaphorical sense. ... In this anti-legal sense, the word
'ight is the greatest enemy of reason, and the most terrible destroyer ^f govern-
ment."

Page 3

Final Examination in Law and Society, Law 383, First Semester 1958-1959 Page k

7. "The grandest function of the Law of Nature was discharged in giving birth to
iiKX'err International Law."

8. "An intellect great enough to win the prize needs ether food besides success.
. . . connect your subject with the universe and catch an echo of +-.he infinite."

9. "Rules of law, enabling us to determine the operative effect of facts, are not
discovered by mere analysis; they are discovered rather by a study of history —
by a knowledge of written statutes, of precedents, and of social mores. The terms
and onohod of analysis here presented are merely to malie possible a greater clear-
ness of mental concept and a nicer accuracy of expression."

Page k

Final Examination in Lav; and Society, Lav 363, First Semester 1956- 195v Page 5

10. "From the judicial standpoint law is a rule according to which the judge has
to decide the law-suits that are brought before him. . . . /But law may also be
defined as>7 a rule f»f human behavior. A rule of human behavior and a rule according
to which a judge decides law-suits may be two very different things, for men cer-
tainly do cot always behave in accordance with the same rules that are applied for
the decision of their suits."

11. "The great gain in its fundamental conceptions which Jurisprudence mfde during
the last century was the recognition of the truth that the Law of a State or other
organized body is not an ideal, but something which actually exists."

12. "If by any means we can determine the early forms of jural conceptions, they
will be invaluable to us. These rudimentary ideas are to the jurist what t^
primary crusts of the earth are to the geologist. They contain, potentially, all
the forms in which law has subsequently exhibited itself."

Page- 5

*?i

Final Examination in Law and Society, Law 383, First Semester 1958-1959 Page 6

PART II - Essay (2 Hours)

A. Write on one of the following two questions (about one hour):

1. In an article at 71 Harv. L. Rev. 593, Professor H. L. A. Hart says:

"It may help to identify five (there may be more) meanings of 'positivism.'
bandied about in contemporary jurisprudence:

(1) the contention that laws are commands of human beings,

(2) the contention that there is no necessary connection "heLreen
law and morals or law as it is and ought to be,

(3) the contention that the analysis (or study of t^e meaning) of
legal concepts is (a) worth pursuing and (b) to be distinguished from
historical inquiries into the causes or origins of laws, from socio-
logical inquiries into the relation of law and other social phenomena,
and from the criticism or appraisal of law whether in terms of morals,
social aims, ' functions' , or otherwise,

(k) the contention that a legal system is a 'closed logical
system' in which correct legal decisions can be deduced by logical
means from predetermined legal rules without reference to social aims,
policies, moral standards, and

(5) the contention that moral judgments cannot be established
or defended, as statements of facts can, by rational argument, evidence,
or proof ( 'noncognitivism' in ethics)."

Of the various writers we Lave studied in this course, which of them are
"legal positivists" and in what sense(s) of that word? Co you consider yourself
a "legal positivist" and if so, in what sense(s)?

2. It has been said that "there are basically only two sources of law: legislation
and adjudication." What views as to the relative importance and interrelation of
these two sources were held by some of the main writers we have studied in this
course? What view of the matter do you take?

B. Write on one of the following two questions (about one hour):

3. Comment on the following statements: (a) "The only truth in theories of
natural law is the obvious truth that positive laws are not immune from moral
criticism." (b) "The history of the last few years suggests that natural law is
a necessary fiction."

h. The Nineteenth Century has been described as the great century of ferment in
legal philosophy. What were the main currents of juristic thought in this century?
Why was the Nineteenth Century generally a period hostile to natural law?

.

•

-

NAME NO .

FINAL EXAMINATION IN LAW AND SOCIETY ( Law 383 )
Summer Session i960

Question I. Professor Cleary. Time: 15 minutes

Can legal "realism" be turned to constructive ends? Discuss.

Final Examination in Law and Society (Law 383), Summer Session i960 Page 2
NAME NO.

QUESTION II. Professor Stephens. Time: 15 minutes

With regard to the "uneasy case for progressive taxation," if one plausible but
uncertain assumption is made, "the logical outcome of the benefit test would . . .
be a highly regressive tax system." Indicate the necessary assumption and explain
how it would lead to the supposed outcome .

Final Examination in Law and Society (Law 383)7 Summer Session 196c Page 3

NAME NO.

QUESTION III. Professor Young. Time: 15 minutes

Discuss the following proposition: Our tax system, federal, state and local,
reflects strict adherence by the legislative and judicial branches of the govern-
ment to the ability to pay and benefit principles of taxation.

Pq cr& 3

Final Examination in Law and Society (Law 383), Summer Session i960 page

Part II
NAME NO.

QUESTION VII. Professor Cribbet. Time: 15 minutes

Anglo-American property law has long recognized (since the Statute of Wills, 15^-0)
the power of a testator to dispose of his property interests with relative free-
dom. In i960, State X passes an Act which restricts the objects of a testator's
bounty to the categories listed in the Statute of Descent, i/£ = > the will may
allocate the amount to be given to relatives of various degrees but it may not go
beyond those classes. Any attempt to leave to individuals, corporations, etc.,
outside the Statute causes the testator to die intestate as to that property. A
testator leaves all of his property to a university which claims the gift and
alleges that the Act is unconstitutional and void since it is a deprivation of
property without due process of law.

Is the Act valid or invalid? Explain your answer in the light of Holmes's
philosophy of law and/or the assigned material on "Property as an Institution."
(Please write answer on this page.)

NAME NO

FINAL EXAMINATION IN LAU AND SOCIETY (Law 383)
Summer Session i960 Professor Looper

Part II

Time: 11/2 Hours

Write on any two (2) of the following four questions. You have about
lj-5 minutes for each question, but spend a fair part of this in think-
ing rather than writing.

1. What do you find distinctive about the American contribution to legal theory
(as contrasted with the British or Continental)? In the aggregate is the
American contribution really significant?

2. What are the real issues in the controversy between "natural law" and "legal
positivism"? What are some sham issues in this controversy?

3. Discuss the applicability of Aristotle's theory of justice to some current
problems of tax law. As a part of this discussion, you might examine the
notion of "fairness" or "justice" in taxation.

h. Discuss and compare the legal philosophies of any two of the following judges
(created by Fuller): Chief Justice Truepenny, Justices Foster, Tatting,
Keen, and Handy.

(Please write answers in examination booklet.)

Final Examination in Law and Society (Law 383)? Part II, Summer i960 Page 2
NAME NO.

QUESTION V. . PROFESSOR STONE. Time: 15 minutes
(Please write answer on this page.)

For those assigned Wolfe v. North Carolina : Discuss the .justification for a court's
disposing of a case on the basis of an assumption which is contrary to fact.

For those assigned Hannah v. Lore he: Can you justify the sacrifice of individual
interest to the legislature's need for information? What, if any, change in the
present accommodation of conflicting interests might be preferable?

Final Examination in Law and Society (Law 3^3) Part II, Summer i960

NAME

Page 3
NO.

QUESTION VI. PROFESSOR HAWKLAHD. Time: 15 minutes
(Please write answer on this page.)

"Law is the ensemble of precepts, rules or statutes which govern human activity
in society, the observance whereof is sanctioned in case of need by social con-
straint, otherwise called public force." - 1 Colin et Capitant, Droit Civil
Francais p. 1 (I91U); see Patterson, Jurisprudence, p. 73 (1953).

Is the quotation a definition of law or a partial characterization of law (a
statement about law, giving seme of its necessary attributes without purporting to
be complete)? Answer the question from the point of view of (l) ideal conceptions
of law; (2) institutional conceptions of law; and (3) imperative conceptions of law.

Part II, Page 3

m

No.

FINAL EXAMINATION I^7 LEGAL ACCOUNTING (Lav ^57)
First Semester 1958-1959 Professor Stephens

TIME LIMIT: 3 HOURS

This examination consists of four parts. Eacn part is marked with
a percentage figure to indicate its relative weight for grading pur-
poses, but this may not be an accurate indication of the portion of
the examination period that should be devoted to such part. Lo^k over
the entire examination and then budget your time with a view to com-
pleting it.

PART I (to$)

In this part ten business transactions are briefly described. After
each description journal entries are presented that might be used to
record the transaction. In each instance, one proposed entry is in-
correct; of the other two one is preferable, at least if scne further
reasonable assumption is made. In the spaces provided, marl the in-
correct entry "I"; mark the preferable entry "P"; leave the remaining
space blank. Finally, in at most a sentence or two and witutn the
space provided on the examination paper, give your reasons for not
selecting the entry which is not marked. The explanatory remarks will
be of substantial importance for grading purposes.

1. The A Company purchases from B Company, its regular supplier, $1000
worth of lumber for fabrication into wooden boxes, A's main product.

a. Purchases $1000

A/?, B Co. $1000

b. A/P, B Co. $1000

Profit and Loss $100C

c. Inventory $lo0C

A/P, B Co. $1000

rinal Examination in Legal Accounting, Law 357, First Semester 1958-1959 Page 2

2. At the end of an accounting period, the office employees of C Crmpany
lave earned $2000 in salaries that will not actually be paid until the fourth day
jf the next period.

a.

Salary Expense
Cash

$2000

$2000

b.

Salary Expense

Accrued Salaries

$2000

$2000

c.

Salary Expense

Accounts Payable

$2000

$2000

3- D Company returned to E Company, its regular supplier, materials D had
purchased in the same accounting period on open account for $500, and L Company
issued a credit memo for that amount.

A/P, E Co.

Purcha ses Returns

A/R, E Co.

Purchases

Purchases Returns
A/P, E Co.

$500

$500

$500

$500

$500

$500

Page 2

Final Examination in Legal Accounting, Lav 357, First Semester 1956-1959 rage 3

k. F Co., G1 s regular supplier of bolts used in its manufacturing ox ora-
tion, raised the price of the bolts $1.CC per hundred to $6.00 per hundred. Upon
G1 s protest, F agreed to and did supply G 10,000 bolts at the old p^'ice.

Purchases

A/P, F Co.
Discount on

Purchase

$600

$500
$100

Purchases

A/P, F Co.

$500

$500

Purchases

A/P, F Co.

Profit on Purchases

$6oc

$500

$1C0

5. The I Company constructs ibridges. Its practice is to take up one-half
of its expected profit vhen a job is three-fourths completed and the balance when
the job is done. In 1958 it began construction of a bridge and had reached the
stage of 8<yfo of completion by the end of the year, its sole project at the time.
Anticipated total costs are $200,000; costs of $l6o,000 have been incurred. The
price of $2^0,000 is to be paid upon completion. Its closing entries, in part:

a.

Contracts in Process

Sundry Cost Accounts
Profit on Bridge

$180,000

$160,000
$ 20,000

b.

Contracts in Process
Profit & Loss

$l8C,0C0

$180,000

Profit & Loss

Sundry Cost Accounts

$160,000

$160, COO

c.

Accounts Receivable

Sundry Cost Accounts
Deferred Income

$180,000

$160, CCO

$ 20,000

Page 3

Final Examination in Legal Accounting, Law 357, First Semester 1958-1959 Page k

6. Late in December 1958, J Company sublet to K part of a building that J
rented from L. K agreed to pay in advance quarterly rent of $500 ueginning January
1st and paid $500 upon execution of the sublease, which J Company credited to
Miscellaneous Income. Upon closing the books for 1958:

b.

Miscellaneous Income
Deferred Income

$500

$500

Miscellaneous Income
Rent Expense

$500

$500

Prepaid F.ent

Miscellaneous Income

$500

$500

7- During the year the M Company became liable for real property taxes of
$3000, which it paid when due and charged to Tax Expense when paid. At the end of
1958 it appeared that $500 of this amount was properly paid but paid as tax on a

building
The year-

that
•end

was
adju

under construction and
sting entry:

would

not

be

completed until

mid-

■1959.

a.

Prepaid Taxes

Tax Expense

$500

$500

b.

Deferred Expense
Tax Expense

$500

$500

c.

Land and Buildings
Tax Expense

$500

$500

.....

1

1

—

Page

k

Final Examination in Legal Accounting, Law 357, First Semester 1958-1959 Page 5

8. At the end of 1958> "the N Company's directors decide to expand its manu
facturing business and to build a new plant that will cost $100,000, funds for
wrich should be set aside.

a. Profit & Loss (1958) $100,000

Reserve for Plant Expansion $100,000

b. Retained Earnings $100,000

Reserve for Plant Expansion $100,000

c. No journal entry but note in annual statement

explaining directors' plans

9- The 0 Company follows the practice of crediting Reserve -for Ba^ Debts
periodically with a percentage of sales and charging the same account with debts
written off as uncollectible. When P went through bankruptcy in 1956. 0 Company
wrote off the $600 that P owed to 0 for purchases on open account. In 195" r
voluntarily paid 0 the full $600.

c.

Cash

$600

A/R, P

$6co

Cash

$6oo

Reserve for Bad Debts

$6oo

Cash

Bad Debts Collected

$6co

$6co

Page 5

4B
Final Examination in Legal Accounting, Law 357, First Semester 1958-19:59 Page 6

10. The Q Company filed a claim for refund of federal incon.^ tax paid for
the year 1952 and after extended negotiations with the Internal Revenue Service
received a refund check for $5000 in 1958.

b.

c.

Cash

$5000

Retained Earnings

$5000

Cash

$5000

Miscellaneous Income

$5000

Cash

Tax Expense

$5000

$5000

■* * * •* *

Page 6

Final Examination in Legal Accounting, Law 357, First Semester 195&-1939 Fage 7

PART II (2Cfl)

This part consists of four questions that are to be answered briefly. If
possible, confine your answer to the space provided after each question. If abso-
lutely necessary, continue your answer on the back of the page on ^hich the question
appears .

1. With respect to its investments, Able Corporation follows the practice
of making year-end adjusting entries so as to reflect investments in its accounts
at the lower of cost or market. In 195o Able purchased ICO shares of Baker stock,
which it still owns, for $100 per share. At December 31, 195&, "the stock was worth
$11,000, but on December 31, 1957, it was worth only $9, COO. Eaker be I a good year
in 1958 and by December 31 of that year its stock was selling on a major stock
exchange for $150 per share. What adjusting entry, if any, should be made at the
end of 1958? What bearing, if any, should the fluctuation of the Baker sxock have
on the propriety of dividend declarations by Able Corporation?

2. Charlie Corporation decided to raise funds for expansion by way of a bon:".
issue. It was decided to issue $100 face amount ten-year bonds at an annus. 1 in-
terest rate of k.5<fo, but at the time of issuance the company was advised that the
bonds would not be marketable unless the yield to lenders was 5$- Should the bonds
be issued at a cost to investors of $85, $90, $95, or $100? Shcw.the proper journal
sntry upon the sale of one bond at the determined price and indicate very briefly
how the transaction will affect the determination of the income of Charlie Corpora-
tion in the current year and future years.

Page 7

Final Examination in Legal accounting, Lav 357, First Semester 195&-1959 Page 8

3. Dog Corporation had authorized 10,00C shares of $100 par common stock of
which 9 > COO shares were outstanding, all issued at the time of incorporation and
paid for at par. On July 1, 1958, it issued, the remaining 1,000 shares that were
authorized and received $200 per share. A3 of the end of 1958 the Dog Corporation
balance sheet reflected, among other things:

Paid in Surplus $100,000

Criticize the term used to designate this account in part by explaining another way
in which a credit to "Paid in Surplus" might arise.

h. Journalize and explain the legal and accounting significance of the
following transaction: Easy Corporation, with retained earnings of $200,000,-
declares and distributes to its shareholders a stock dividend consisting of iooo
shares of $100 par value common stock. Indicate a genuine business reason that
might induce such action.

Page

a*

Final Examination in Legal Accounting, Law 357, First Semester 1958-1959 Page 9

PART III (20$)

There are just two questions in this part. They are of equal value for
grading purposes.

1. Fox Corporation is in the merchandising business and deals ,ia cnlv one
commodity. Curing the year 1957, it made the following purchases at the following
prices:

Date No. of Units Price

January 1 10,000

April 1 20,000

July 1 10,000

October 1 10,000

It sold 50,000 units during 1957- Its balance sheet as of December 31, 1956, showed
an inventory figure of $50,000 (which reflected 50,000 units on hand). I+s balance
sheet as of December 31, 1957, also showed an inventory figure of $50,000.

In 1958, Fox Corporation again sold 50,C00 units. Its purchases for the year
were as follows:

"Date No. of Units Price

January 1 20,000 1.25

April 1 10,000 1.25
July 1

October 1 20,000 1.00

Determine the cost of goods sold for 1958. Show and fully explain yen.
cemputations.

1

00

1

.10

1

.10

1

20

Page 9

Final Examination in Legal Accounting, Lav 357, First Semester 1958-195° Page 10

2. George Corporation rents most of the facilities used in its business;
however, it owns a delivery truck which it purchased new on January 1, 15?^> at a
cost of $3,000. It may be anticipated that the truck will be used for 60,000 miles
of service and that it will be useful for a period of five years. It was in fact
driven 15,000 miles in 1956, 15,000 miles in 1957, and 10,000 miles in 1958. As of
the end of 1957, the George balance sheet showed the truck as follows:

Delivery Truck:

Cost $3000

Res. for depreciation 1920 $1080

In accordance with the depreciation method that has been adopted by the
Company, determine depreciation expense for 1958- Show your computations, ana
indicate why you think George Corporation may prefer the method adopted over other
possible methods.

Page 10

Final Examination in Legal Acoounting, Lav 357, First Semester 1955-19^9 Page 11

PART IV (20$)

At the close of 1958 tne ledger accounts of Wholesale Suppliers, Inc., re-
flected the following balances:

Cash

Inventory (1/1/58)

Furniture & Fixtures after

reserve for depreciation
A/R, Smith
A/R, Jones
Note Payable
A/P, Black
A/P, White
Sales

In accordance with the Company1 s regular practices, the closing inventory is deter-
mined to be $15,000.

$8,000

Sales Returns

$ 500

l4,0C0

Purchases

16,000

Purchases Returns

1,000

4,500

Advertising Expense

500

500

Accrued Wages

500

5,000

Wages Expense

2,500

6,000

Common Stock

14,000

4,000

Surplus

6,400

100

Dividend Paid

1,000

20, 500

1. On the basis of the facts given, fill out the Trial Balance, P & L
Statement, and Balance Sheet columns on the work sheet form provided ou the next
page.

2. Prepare a Ealance Sheet for Wholesale as of December 31, 19^8, in
account form, and a simple income statement and statement of surplus changes for
1958, disregarding the question of taxes. (Use this page and the back of it to
answer this and the next question. )

3. If you had money to invest and the principal shareholder in Wholesale
Suppliers offered to sell you 25^ of the outstanding stock of the company for
$5500, what would your reaction be? Explain fully.

Page 11

Final Examination in Le^al Accounting, Law 357, First Semester 1958-1959 Page 12

Wholesale Suppliers, Inc. — Dec. 31, 1958

Ledger Accounts

Trial Balance

Profit & Loss

Balance Sheet

1

i

1

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FINAL EXAMINATION IN LEGAL PROFESSION (Law 3pO)

First Semester 1958-1959 Dean Sullivan

MAXIMUM TIME: 1 l/2 hours

1 . A was licensed to practice both as an attorney and as a certified public
accountan': and he had engaged in the practice of both professions. As an account-
ant, he had done work for the J.B. Company. Three years later Shapiro, presi-
dent of the J.B. Company, discussed with A the bringing of a suit against the
United States to recover income taxes which Shapiro thought had been overpaid.

A wrote a letter to Shapiro agreeing to bring the suit on a contingent-fee basis
for a fee of 50% of the money. The letter then read as follows:

"We will, of course, bear the expense of the expert. We will bill you for
the filing fees and such other minor incidental costs as may be incurred pur-
suant to rules of the District Court. We would appreciate your signing the orig-
inal , of this letter to signify your consent to this proceeding. Will you please
return the signed letter as soon as possible, and retain the duplicate for your
files .

(Signed) A"

"(Signed) Shapiro. As approved by Shapiro subject to abOA'e deletion as discussed
with A."

The sentence beginning "We will bill you" had been deleted by drawing a line
through the words .

A was successful in the law suit and the United States sent a check for
$9,000, being $8,000 refund plus $1,000 interest. A is holding the check and he
demands that Shapiro agree to pay $^500 from the check before A is required to
turn it ever to Shapiro. Shapiro refuses and A seeks to enforce his lien. What
result? Why?

Does A's conduct violate the standards of professional ethics? Discuss.

2. L.M., an attorney at law admitted to practice in State X, represented L, the
defendant, in a prosecution in the United States District Court under the Smith
Act for advocating the overthrow of government by force and violence . The trial
lasted mere than six weeks . During this period A, an officer of the ur.icn of
which D was a member, arranged some meetings to arouse interest in the outcome
of the suit and to raise funds to help pay the expenses. L.M. attended two of
these meetings and made speeches . Reporters from the local newspapers were
present and they reported and the papers printed a story that L.M. attackeu. the
judge in the proceedings by saying, "This trial is a phony," "They are making up
the rules of evidence as they proceed in this trial," ;'D is being persecuted in
this trial," and "The FBI is out to break this union by a smear campaign of
communistic charges . "

Charges were filed with the grievance committee of the local bar association.
The committee members had been appointed as commissioners in the State Supreme
Court to hear complaints and make recommendations to the Court. Upon tnese facts
(assuming that L.M. does not deny that he made the statements attributed to him),
what action should the committee and the Court take? Discuss.

3- C, the client, has employed A to represent him in an action to recover damages
for a personal injury sustained in an automobile accident. After the complaint
was filed, C insisted on participation in the decisions on the witnesses to be
ca]led, the proof to be elicited from the witnesses, etc.

Discuss the scope of the authority of A tc control all phases of the liti-
gation.

FINAL EXAMINATION IN LEGAL PROFESSION (Law 350)
First Semester 1959-I960 Dean Sullivan

TIME: 1 1/2 HOURS

1. Comment on the following practices in the light of the decision of the Supreme
Court of Illinois in "In re Brotherhood of Railroad Trainmen" :

1. The practice of attorneys or their representatives at any time, whether
organized or in isolated instances, in soliciting directly or indirectly
by personal contact, telephone, or other means, legal business or causes
of action of any kind or description.

2. The practice of attorneys engaged in the defense of personal injury
actions for and on behalf of insurance companies in inducing by solici-
tation, suggestion, or other means injured parties to retain their
services or the services of other attorneys named by them in establishing
claims for injuries or property damage, arising out of accidents in
which the insurance companies represented by such attorneys carry the
liability insurance for the injured party.

3- The practice of attorneys in expending substantial suras for elaborate
entertainment of individuals or corporate representatives at private
clubs or otherwise as a means designed for obtaining legal business, or
by the bestowal of gifts of substantial value to such parties, for the
purpose of inducing such individuals, representatives, or their
corporate principals to retain or engage the services of such attorneys
in any legal matters or business .

h. The practice of attorneys in soliciting insurance companies or other
corporations by any means to employ or forward legal business to them.

5. The practice of attorneys for insurance companies, railroads, and other
corporations or their representatives or claim departments in inducing
parties seriously injured as a result of an accident for which their
principals may ultimately be held liable, to settle their claims before
they have had adequate opportunity to confer with and obtain the advice
of counsel of their own choice .

2. In a personal injury action in State X, the case was tried for a corporation
of State Y by an attorney in State X. The decision was against the corporation.
On appeal an attorney from State Y prepared the brief and argued the case . In
the brief Y attorney contended that: "It is shown by uncontradicted evidence that
an interval of 15 to 20 minutes had elapsed between the all-clear signal, followed
by an air brake test, which took thirty seconds, and the actual starting

of the train by the engineer." The Appellate Court examined the transcript of the
evidence in the case and found no ground whatever for this statement. Since this
might have influenced the result in the case, attorney Y is directed to show cause
why he should not be disciplined.

(a) Decide the case. Give reasons.

(b) Discuss the following quotation:

"The extent to which it is regarded as counsel's duty to advise
the court as to matters relevant to the proper decision of the case

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Final Examination in Law 350, First Semester I959-&0 Page 2

of which opposing counsel is ignorant or which he has overlooked
turns on the degree to which the old idea that litigation is a game
between the lawyers has been supplanted by the more modern view that
the lawyer is a minister of justice. Always, however , must be borne
in mind the principle that the theory of our system is still that
justice is best accomplished by having all the facts and arguments
on each side investigated and presented with maximum vigor by
opposing counsel, for decision by the court and jury."

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FINAL EXAMINATION IN LEGISLATION (Law 331)
Second Semester 1958-1959 Professor Conn

TIME: k HOURS

t

Note : Wherever canons of interpretation may be relevant, they should he
noted.

1. A federal statute is entitled "An Act to punish the purchase and sale of public
offices." It consists of two sections which read as follows:

"Sec. 1. Whoever pays or offers or promises any money or thing of
value, to any person, firm, or corporation in consideration of the use
or promise to use any influence to procure any appointive office or
place under the United States for any person, shall be fined not more
than $1,000 or imprisoned not more than one year, or both.

"Sec. 2. It is unlawful to solicit or receive from anyone whatso-
ever, either as a political contribution, or for personal emolument, any
sum of money or thing of value, whatsoever, in consideration of the
promise of support, or use of influence, or for the support or influence
of the payee, in behalf of the person paying the money, or any other
person, in obtaining any appointive office or place under the Government
of the United States. Whoever is guilty of a violation of this section
shall be fined not more than $1,000 or imprisoned not more than one year,
or both."

An information was filed in a federal district court alleging that defendant
Jackson had offered Adams, a member of the Congress, to contribute $1,000 per year
to the Republican Party in consideration of the Congressman's use of his influence
to procure for the defendant the postmastership of a designated municipality. The
information alleged this to be a direct violation of Section 1, although it did not
charge that the Congressman would directly benefit from the payment of money to the
Republican Party. The district court granted a motion to dismiss for failure to
state facts sufficient to constitute an offense against the United States. The
government appeals to the United States Supreme Court.

The Committee Report which accompanied the introduction of the bill stated in
part as follows:

"This bill seeks to punish the purchase and sale of public offices .
Certain members of Congress have brought to the attention of the House
both by speeches on the floor and statements before the Judiciary Com-
mittee a grave situation, disclosing corruption in connection with postal
appointments in Mississippi and South Carolina. It is believed that this
bill will prevent corrupt practices in connection with patronage appoint-
ments in the future."

The Congressman who introduced the bill, in describing the corruption to which
the Committee Report refers, said, in response to the question, "Where did this
money finally find its home?",

"I do not know. As I said here once before, I doubt if much of it
gets to the Republican Executive Committee, but I do not care where it
goes . Either it goes into his pocket and the pockets of his machine or

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Final Examination in Lav 331, Second Semester 1958-1959 Page 2.

it goes into the coffers of the Republican Party. If it does, it is
the most blatant defiance of the civil service law that any party has
ever had the hardihood to put over, and it is as disgraceful as the
Teapot Dome proposition any day."

Other aspects of the Committee Report and legislative history shed no further
light on the problem.

(a) As counsel for the government, develop your interpretative analysis in
support of the information.

(b) As counsel for the defendant, develop your interpretative analysis in
support of the district court's order.

(c) As a member of and speaking for the United States Supreme Court, give
your decision and reasons.

2. In 19^3 > the Illinois General Assembly enacted a lav, the title and Section 1
of which read as f ollovs :

"A Bill

For an Act to authorize the investment of public funds of public
agencies in obligations of the United States of America.

/Enacting Clause (assume in proper foraOZ

"Sec. 1. Any public agency may invest any public funds in bonds,
notes, certificates of indebtedness, treasury bills or other securities
now or hereafter issued by and constituting direct obligations of the
United States of America. Any such securities may be purchased at the
offering or market price thereof at the time of such purchase."

The remainder of the section defines "public agency" and "public funds." The
Act contained no provisions imposing civil or criminal penalties upon public officers
making investments not authorized by this Act .

In 1957 the General Assembly enacted two laws, one amending Section 1 of the
aforesaid Act (H.B. 350) and the other an original act (S.B. 590). House Bill 350
inserted the following language after the word "America" :

"or may invest in shares or other forms of securities legally issuable
by savings and building and loan associations incorporated under the
laws of this state or any other state or under the laws of the United
States; provided, however, that investments may be made only in those savings
and loan or building and loan associations the shares, or investment
certificates of which are insured by the Federal Savings and Loan In-
surance Corporation."

The remainder of Section 1 was set forth and repeated without change.

Senate Bill No. 590 vas an act entitled "An Act to make unlawful, and to pre-
scribe penalties for, the investment of public funds by public agencies in violation
of limitations prescribed by lav." The body of the Act read as f ollovs :

Final Examination in Law 331, Second Semester 1958-1959 Page 3.

"Sec. 1. It is unlawful for any public officer to invest public
funds except as authorized by 'An Act to authorize the investment of
public funds of public agencies in obligations of the United States of
America,1 approved July 6, 19^-3 • Any public officer who violates the
provisions of this act shall be fined not more than $5,000 or imprisoned
for not more than 5 years, or both."

The corporate authorities of the city of Champaign, a public agency within the
definition of the aforesaid laws, desire to invest $50,000 of public funds in the
shares of a state building and loan association, which shares are issued by the Fed-
eral Savings and Loan Insurance Corporation, a governmental instrumentality. They
ask your advice, as city attorney, as to their legal power to do so. Analyze and
discuss the constitutional and interpretative issues involved in the foregoing
legislative history.

3. The Federal Trade Commission issued a complaint chaiging the X Department Store,
a retailer, with "false invoicing" in violation of Section 3 of the federal Fur
Products Labeling Act. An administrative hearing resulted in findings of violation.
The Commission issued a ceas e 'and desist order and the X Department Store sought
judicial review in the appropriate Court of Appeals, which set the order aside. The
Commission appeals to the United States Supreme Court.

Section 3 reads as follows :

"The manufacture for sale, sale, advertising, offering for sale,
transportation or distribution, of any fur product which is made in
whole or in part of fur which has been shipped and received in commerce,
and which is misbranded or falsely or deceptively advertised or invoiced,
within the meaning of this Act, is unlawful and shall be an unfair method
of competition, and an unfair and deceptive act or practice, in commerce
under the Federal Trade Commission Act."

Section 2 of the Act defines the term "invoice" as a "written account, memo-
randum, list, or catalogue, which is issued in connection with any commercial deal-
ing in fur products or furs, and describes the particulars of any fur products or
furs, transported or delivered to a purchaser, consignee, factor, bailee, corres-
pondent, or agent, or any other person who is engaged in dealing commercially in
fur products or furs."

Section 5 provides that a fur product or fur is falsely invoiced "if it is not
invoiced to show (a) the name of the animal that produced the fur; and, where appli-
cable, that the product (b) contains used fur; (c) contains bleached, dyed, or
other artificially colored fur; (d) is composed in whole or substantial part of paws,
tails, bellies, or waste fur; (e) the name and address of the person issuing the
invoice, and (f) the country of origin of any imported furs."

Section k requires each fur product or fur to have affixed thereto a label and
provides that a fur product is misbranded if it is falsely or deceptively labeled
or if there is not affixed a label setting forth the same items of information re-
quired for an invoice under Section 5- Labels need not be pieces of cloth sewn
into the fur products . They can be tags attached by string to the garment .

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Final Examination in Law 331, Second Semester 1958-1959 Page k.

The Commission found that respondent had violated the "invoice" provisions of
the Act by failure to include in many of its retail sales slips of fur products (a)
its address, (b) whether the fur was bleached, dyed or otherwise colored artifically,
and (c) the correct name of the animal producing the fur. The Commission did not
find any violations of the labeling requirements of Section k.

The title of the Act states that its purpose is to "protect consumers and
others against false invoicing, misbranding and false or deceptive advertising."
The Committee Reports speak generally of the protection of consumers and others frcm
"widespread" abuses "arising out of false and misleading matter in advertising and
otherwise . "

Analyze and discuss the interpretative issues, giving decision.

k. In February 1959 "the Supreme Court of Illinois upheld the validity of exculpa-
tory clauses in business and residential leases exempting the lessor from liability
for injuries to persons or property caused by or resulting from the negligence of
the lessor, his agents, servants or employees, in the operation or maintenance of
the demised premises. Shortly thereafter H.B. 129 was introduced in the Illinois
General Assembly, passed both Houses, and was signed by the Governor early in May
1959- Its provisions are as follows:

"Every covenant, agreement, or understanding in or in connection
with or collateral to any lease of real property, except those business
leases in which any municipal corporation, governmental unit, or cor-
poration or instrumentality of the State or federal government is lessor,
and except leases of property designed and used for single family dwelling
purposes, exempting the lessor from liability for damages for injuries
to person or property caused by or resulting from the negligence of the
lessor, his agents, servants or employees, in the operation or mainten-
ance of the demised premises or the real property containing the demised
premises, shall be deemed to be void as against public policy and wholly
unenforceable . "

In 1957, the X Building Corporation had leased business premises to Jones and
Adams, a partnership engaged in light manufacturing in the leased premises. The
lease was for a period of five years and contained the exculpatory clause. Assume
that in September 1959 Jones is injured on the premises as the result of the negli-
gence of the lessor's employee in repairing a section of the floor. Jones files
suit for damages against the X Building Corporation. What defenses would the de-
fendant raise? Analyze and discuss all such defenses and give decision.

5- Answer the following questions true (T) or false (F) in the examination booklet:

(1) Under Article k, Section 20 of the Constitution of Illinois, an act
appropriating public funds to a named person for a purpose which cannot
be public in nature is unconstitutional.

(2) Incorporation of an act by reference is not permissible under the Con-
stitution of Illinois .

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Final Examination in Law 331, Second Semester 1958-1959 Page 5.

(3) An act which is general in form but special in fact and which deals with
a subject specifically enumerated in Article k, Section 22 of the Consti-
tution of Illinois cannot be valid under that section.

(k) A law which changes a crime from a felony to a misdemeanor and which
applies retroactively to crimes committed before its effective date is
invalid as an ex post facto law.

(5) Under the Illinois Constitution, a statute is invalid in its entirety if
the title embraces two distinct and unrelated subjects where the body of
the act contains only one of the subjects expressed in the title.

(6) A statute will not be construed to have retroactive application unless it
expressly so provides.

(7) In Illinois a statute reviving a cause of action barred by the statute of
limitations is valid.

(8) Statutes in pari materia will be construed to make them harmonious and
consistent with each other.

(9) Canons of interpretation may not be ignored by the courts where their
employment is necessary to clarify uncertain or ambiguous meaning.

(10) A long continued and consistent administrative interpretation of a statute
which is not amended at any time after its original enactment does not
prevent the court from adopting a contrary or modified interpretation.

FINAL EXAMINATION IN LEGISLATION (Law 331)
Summer Session 1959 Professor Cohn

TIME: U HOURS

NOTE: Wherever canons of interpretation or presumptions may be applic-
able, reference thereto should be made. Questions are rated as
follows: 1 and k, 25$; 2 and 3, 20$; 5, 1C#.

1. Prior to the enactment by the Congress of the 195*+ Internal Revenue Code, the
predecessor Code contained the following two sections:

"Sec. 15. (a) If any person liable to pay any tax neglects or refuses
to pay the same within 10 days after notice and demand, it shall be lawful
for the Secretary or his delegate to collect such tax ... by levy upon all
property and rights to property belonging to such person.

"(b) The term 'levy' as used in this title includes the power of dis-
traint and seizure by any means. In any case in which the Secre-crry or his
delegate may levy upon property or rights to property, he may seir.e and
sell such property or rights to property (whether real or personal, tangible
or intangible).

"Sec. 16. (a) Any person in possession of (or obligated with respect
to) property or rights to property subject to levy upon which a levy has
been made shall, upon demand of the Secretary or his delegate, surrender
such property or rights (or discharge such obligation) to the Secretary or
his delegate, except such part of the property or rights as is, at the
time of such demand, subject to an attachment or execution under any
judicial process.

"(b) Any person who fails or refuses to surrender as required by sub-
section (a ) any property or rights to property, subject to levy, upon demand
by the Secretary or his delegate, shall be liable in his own person and
estate to the United States in a sum equal to the value of the property or
rights not so surrendered, but not exceeding the amount of the taxes for
the collection of which such levy has been made, together with costs and
interest on such sum at the rate of 6$> per annum from the date of such levy.

"(c) The term 'person,1 as used in subsection (a), includes an officer
or employee of a corporation, or a member or employee of a partnership, who
as such officer, employee, or member is under a duty to surrender the
property, or rights to property, or to discharge the obligation."

Both these sections were re-enacted without change in the 195^ Internal Revenue
Code. In 1955 the Congress passed an amendment to Sec. 15 in the following form:

"An Act to amend Section 15 of the Internal Revenue Code of 195^

"/Enacting clause (assume in customary formjj

"Section 1. Amend Section 15 of the Internal Revenue Code of 195^ , in
subsection (a) thereof, by adding the following sentence at the end of said
subsection:

Levy may be made upon the accrued salary or wages of any officer,
employee, or elected official of the United States, the District of
Columbia, or any agency or instrumentality of the United States or
the District of Columbia, by serving a notice of levy upon the employer."

The House Report accompanying this amendment stated that it was necessary to
overcome the effect of a Supreme Court decision which had held that a federal dis-
bursing officer could not, in the absence of express Congressional authorization,
set off an indebtedness of a federal employee to the government against the employ-
ee's salary, and a subsequent ruling of the Comptroller General, based on this

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Final Examination in Legislation (Law 331) > Summer 1959 Page 2

Court decision, that an administrative official served with notice of a levy would
be without authority to withhold any portion of the current salary of such . r
employee in satisfaction of the notices of levy and distraint.

In February 1956 the Commissioner of Internal Revenue (the delegate of the
Secretary of the Treasury) issued the following regulation applicable to Section 15:

"State and municipal employees. Accrued salaries, wages, or other
compensation of any officer, employee, or elected or appointed official of
a State or Territory, or of any agency or instrumentality, or political
subdivision thereof, are also subject to levy to enforce collection of
any federal tax."

In June 1956, the Congress amended Section 15 of the Code, making a slight
clarifying change in subsection (b), but effecting no change whatsoever in sub-
section (a).

In September 1956, "the Commissioner of Internal Revenue assessed an excise tax
deficiency against two residents of Illinois and forwarded the assessment lists to
the appropriate District Director of Internal Revenue for collection. The defici-
encies remained unpaid for more than 10 days after demand for payment was made;
whereupon the District Director issued notices of levy directed to the State of
Illinois and served then upon Smith, the State Auditor of Public Accounts, seizing
the accrued salaries of the taxpayers who were employees of the State of Illinois,
pursuant to Section 15 . Smith refused to honor the levies and instead issued and
delivered payroll warrants to the two employees for their then accrued net salaries
aggregating $650.00. Thereafter, the government brought suit under Section l6
against the Auditor in the appropriate district court to recover from him personally
the $650.00 that he had paid in disobedience to the government levies, the said
amount being less than the assessed deficiencies.

Under Illinois statutes, state funds are in the custody of the State Treasurer,
but no payments of public funds may be made except upon a warrant issued by the
Auditor of Public Accounts. The Auditor is also empowered and directed by statute
'to deduct and withhold from the salaries of state employees sums to pay taxes as
may be required by any act or acts of the Congress of the United States of America."
Under this latter statute, federal income taxes are withheld from state employees
and paid to the federal government in the same manner as taxes are withheld by
private employers.

The District Court rendered judgment for the government. The Court of Appeals
reversed, and the Supreme Court granted certiorari.

(a) As counsel for the government discuss all issues and develop your inter-
pretative analysis of the statutes and regulations in issue in support of the
suit.

(b) As counsel for the Auditor of Public Accounts, discuss all issues and
develop your interpretative analysis in support of his defense.

(c) As a member of the Supreme Court, give decision supported by a brief
analysis.

2. Section 3h of the Illinois Drivers' License Law provides that the Secretary of
State may revoke or suspend the operator' s or chauffeur' s license of a person who

"has been convicted of not less than three offenses against traffic
laws governing the movement of motor vehicles within any 12 -month period."

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Final Examination in Legislation (Lav 331), Summer 1959 Page 3

Assume that the Illinois General Assembly in 1957 enacts a law which in form
is as follows:

"A Bill

"For An Act to amend Section 3^ of the 'Illinois Drivers' License Law,'
approved June 25, 1953, as amended, and to add Section 3^.1 thereto.

"/Enacting clause (assume in proper formy/

"Section 1. Section 3k of the 'Illinois Drivers' License Lav,' ap-
proved June 25, 1953, as amended, is amended, and Section 3^.1 is added
thereto, the amended and added Sections to read as follows:

"Section 3^- /Assume Section properly amended as to form, with only
change being the substitution of the figures "18" for the figures "12.^7

"Section 3^.1« Notwithstanding the provisions of Section 3U, if a
person is convicted of not less than two offenses against traffic laws
governing the movement of motor vehicles within any l8-month period, such
offenses having occurred within the corporate limits of any city, village
or incorporated town of more than 5CO,000 population, the Secretary of
State may revoke or suspend the operator' s or chauffeur' s license of such
person in accordance with the procedures designated in this Act."

Assume the Act becomes effective July 1, 1957. The Secretary of State on
September 15, 1957, after appropriate notice and hearing, revokes the operator' s
license of Adams. The evidence proves that Adams was twice convicted of speeding
in Chicago on the following dates: July 26, 1956, and April 1, 1956. Adams seeks
a reviev of this order under the provisions of the Administrative Reviev Act as
authorized by the Act.

Analyze and discuss all issues, giving decision. Assume that the Act of 1957
is in proper constitutional form as regards the title and subject matter provisions
of the Constitution.

3- The Federal Kidnapping Law, commonly knovn as the "Lindbergh Lav," punishes
anyone who knovingly transports or aids in transporting in interstate or foreign
commerce

"any person vho shall have been unlawfully seized, confined, inveigled,
decoyed, kidnapped, abducted, or carried avay by any means whatsoever
and held for ransom, reward or otherwise, except in the case of a minor,
by a parent thereof."

The Act vas passed in 1932 against a background of organized violence in which
it had become quite common for ruthless criminals or bands of criminals to seize
wealthy adults or the children of wealthy parents, transport them across state
lines, and demand ransom payments for the safe return of the person so seized. The
Legislative Reports of the House and Senate Committees stress almost exclusively
this customary pattern and the helplessness of state law enforcement officials to
deter or punish the guilty persons. The Act provides a death penalty or life
imprisonment as possible sanctions.

Jones, in the State of Kansas, seduced and had criminal conversation with a
1^-year-old girl who consented to the act. Under the laws of Kansas, Jones was
guilty of statutory rape. He was indicted on this charge and pending trial was
permitted his freedom on bail. The girl, in a juvenile court proceeding, was de-
clared a delinquent child and placed in a state rehabilitation center under the

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Final Examination in Legislation (Law 331 ), Summer 1959 Page h

legal control and custody of the State Director of Welfare. Jones, under an assumed
name, visited her, and induced her to agree to a plan of escape to Texas under a
promise that he would marry her. In accordance with the plan, the following night,
Jones again visited her, bound and gagged the nursing attendant, and escaped with
the girl. He transported her to Texas where they lived together for two years as
man and wife without benefit of clergy. Subsequently Jones, wearying of the girl* s
demands that they marry, killed her. He was apprehended by federal authorities in
California and returned to Kansas where he was charged with a violation of the
Lindbergh Law. The District Court convicted, the Court of Appeals affirmed, and the
Supreme Court granted leave to appeal.

Analyze and discuss the issues and give decision.

k. In 1891 the Illinois General Assembly enacted a law authorizing cities to estab-
lish, operate, and maintain public hospitals, and to levy a tax therefor. After
detailing the provisions relative to acquisition or construction of a hospital, the
management thereof, and the procedures for and the limitations upon the levy of a
tax, Section 10 dealt with the "use" of the hospital and provided as follows:

"Every hospital established or purchased under this Act shall be maintained
for the benefit of the inhabitants of the city in which it is established
who are sick, injured, or maLned. But every inhabitant of that city who is
not a pauper shall pay to the hospital board reasonable compensation for
occupancy, nursing, care, medicines, or attendance, according to the rules
and regulations established by the board. For the purposes of this Section,
a 'pauper' means any indigent person who has been a bona fide resident of
the city for at least 12 months prior to the time of becoming a patient for
treatment in the hospital."

In 187^, the General Assembly had enacted the so-called "Paupers Act," which
imposed responsibility upon counties to relieve and support all persons who tech-
nically qualified as "paupers" and in addition to pay the costs of hospitalization,
support, and care of persons who were destitute but who for lack of residence eli-
gibility failed to qualify technically as a pauper. In 1937 the Fauper Act was
revised to place the obligation for the support of paupers and other indigent persons
upon (l) cities, villages, and incorporated towns having a population in excess of
500,000 (Chicago) j (2) in counties not under township form of government, upon the
counties; and (3) in counties under township form of government, upon the townships.
In each case, liability for support was limited to the residents of the particular
governmental unit, but each governmental unit was also required to provide temporary
support to indigent persons who were technically not paupers, or to paupers who were
legally residents of another chargeable governmental unit, with the right granted
to recover the costs of such support against the governmental unit in which the per-
son had established residence, or was living.

In 19^9 the General Assembly enacted the "Public Assistance Code of Illinois,"
a comprehensive act dealing with all phases of governmental assistance. In this
Act, they re-enacted the provisions of the Pauper Act without change, and repealed
a number of separate laws dealing with public assistance, but neither repealed,
amended, nor made reference to the 1891 City Hospital Act.

In 1957 in the City of Champaign, which had established a public hospital under
the I891 Act, a person who did not qualify as a "pauper" under the Public Assistance
Code but who did qualify under the City Hospital Act as a "pauper" was treated in
the City Hospital for injuries. The City of Champaign is coterminous with the Town-
ship of the City of Champaign, which township under the Public Assistance Code is

Page k

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Final Examination in Legislation (Lav 331 ), Summer 1959 Page 5

liable for the support of paupers resident therein, as well as indigent persons who
technically do not qualify as paupers. The city hospital rendered medical and
nursing services totalling $U,500, and demanded payment of the township. The demand
was refused and the city brings action for recovery of this amount against the
township.

(a) As attorney for the city, interpret the statutes in support of its claim.

(b) As attorney for the township, interpret the statutes in defense of the
township' s claim of freedom from liability.

(c) As a member of the Illinois Supreme Court, give decision and, briefly,
reasons in support thereof.

5. Answer the following questions T (true) or F (false) in the examination booklet.

1) A law special in form and effect cannot be validly enacted under Article IV,
Section 22 of the Constitution of Illinois.

A law granting or creating a special right or cause of action not existent at
common law may be repealed with the legal effect of negating accrued rights
and pending actions.

3) An ex post facto law can never be valid under the federal constitution or the
Constitution of Illinois.

k) A judicial interpretation of a statute by the highest court of a state precludes
contrary administrative interpretation.

5) The counties and other political subdivisions and municipal corporations in the
State of Illinois do not enjoy constitutional immunity from tort or other
liability.

6) A civil cause of action is not presumed to derive in favor of a person injured
by conduct which by statute is made a criminal offense.

T) Legislation authorizing the expenditure of public funds for the benefit of pri-
vate persons may nevertheless be valid if the purpose of the expenditure is
public.

8) Incorporation by reference and repeal by implication, unlike amendment by
reference, are not prohibited by the Constitution of Illinois.

9) Retroactive legislation may validly impair existing rights in most states if
the purpose of the legislation serves the public interest.

10) In an act non-regulatory in nature, the failure of a person to comply with
statutory directions relative to registration will not generally preclude his
right to recover under a contract entered into with another person in respect
to a transaction related to the requirement cf registration.

NOTE: ALL EXAMINATION QUESTIONS MUST BE RETURNED WITH

THE EXAMINATION BOOKLET.

Page 5

FINAL EXAMINATION IN LEGISLATION (Law 331)
Second Semester 1959-1960 Professor Conn

TIME: h HOURS

1. A statute of the State of Illinois establishes a public employee's annuity
and benefit fund which provides retirement and disability benefits. Membership in
the fund is compulsory upon all employees. The fund is financed by employee contri-
butions and state funds. Until July 1, 1959, the provisions respecting eligibility
for disability benefits read as follows:

"Any employee who because of mental or physical disability arising from
any cause becomes unable to perform the duties of his assigned position for
any period exceeding 60 days shall be entitled to a disability benefit; provided,
that no disability benefit shall be paid to any employee who has been an employee
for less than five years if the disability is the result of a mental or physical
condition existing on the date the employee first became a member of the fund."

In 1950, the Illinois General Assembly, by an amendment proper in form, effect-
ive July 1, 1959, repealed the proviso ilause and substituted the following proviso
in lieu thereof:

"provided, no disability benefits shall be payable for any disability which
begins prior to the completion of two years of service unless the disability
is caused by an accident."

Adams, Baker, and Collins were employed on September 1, 1957 , and on that
date first became members of the fund. The physical examinations given them as
required by the Annuity and Benefit Fund Act disclosed that Adams was suffering a
mild degree of hypertension (high blood pressure) and that Baker and Collins were in
perfect condition. On June 1, 1959, Baker suffered a heart attack and while still
hospitalized on August 1, 1959, filed an application for a disability benefit. On
July 25, 1959:. Collins was stricken with tuberculosis, and on September 25 filed his
claim for a disability benefit. On October 1, 1959, Adams suffered a cerebral
hemorrhage, a direct consequence of his hypertension, and on December 1, 1959, he
filed his claim for a disability benefit.

You are the attorney for the Pension Board and are requested to review the
three claims and to recommend approval or disapproval. Analyze the claims and give
your decision in each case.

2. In each of the following problems, state the legal issue in not more than 20
words , and discuss and give decision in not more than 100 words .

(a) Under federal law, transportation of narcotics in interstate commerce
(except where authorized by special permit) is an offense punishable by a fine not
in excess of $15,000, or imprisonment in the federal penitentiary for not less than
one year nor more than five years, or both. Assume that the Congress in i960 enacts
the following amendment to that law, which becomes effective on April 1, i960:

"Any person heretofore or hereafter transporting narcotics in interstate
commerce, except as authorized in this Act, shall be fined not more than $10,000,
or imprisoned in the federal penitentiary for not less than 3 years nor more
than 20 years , or both . "

Final Examination in Legislation (Law 331), Second Semester 1959-19^0 page 2

In June i960, X is prosecuted for a violation of the statute occurring on
November 15, 1959. He is convicted and is sentenced to a term of three years, and
fined $10,000. X appeals. Assume the statute is complete and definite in all
respects.

(b) A state statute provides that it is a misdemeanor punishable by a fine not
in excess of $100 for a person to leave a motor vehicle unattended on a public stree
with the key in the ignition or the motor running. X parked his car on a public
street, leaving the key in the ignition. A few minutes later Y started the car and
made off with it. In his haste to make the getaway, Y ran a red light, crashing
into a car having the right-of-way and injuring P. P sues X for damages to the

car and personal injuries, alleging a violation of the statute.

(c) A state statute provides that a cause of action for breach of contract
shall not be maintained if instituted more than 10 years after the cause of action
accrues. In 195^, P entered into a written contract with D for the sale of personal
property which was delivered to D. D defaulted in the payment of the purchase price
in January 1955. In 1959, the law is amended, effective July 1, 1959, reducing the
period to six years, and is made applicable to causes of action accrued prior to
its effective date if the time remaining to institute action under the amendment

is not less than 180 days. P, unaware of the 1959 amendment, files suit against
D for breach of contract in June 1961. D pleads the statute.

3. In 19^, the United States Supreme Court in United States v. Southeastern
Underwriters Ass'n, 322 U.S. 533, declared the insurance business to be interstate
commerce, thus raising serious doubts as to the continuing power of the states
to tax and regulate the business of insurance, a power which had always been exer-
cised theretofore by the states. In 19^5, the Congress enacted the McCarran-
Ferguson Act, the relevant portions of which are as follows:

"Sec. 1. The Congress hereby declares that the continued regulation
and taxation by the several States of the business of insurance is in the
public interest, and that silence on the part of Congress shall not be
construed to impose any barrier to the regulation or taxation of such business
by the several States.

"Sec. 2 (a). The business of insurance, and every person engaged therein,
shall be subject to the laws of the several States which relate to the regu-
lation or taxation of business.

Ob). No act of Congress shall be construed to invalidate, im-
pair, or supersede any law enacted by any State for the purpose of regulating
the business of insurance, or which imposes a fee or tax upon such business,
unless such Act specifically relates to the business of insurance; provided,
that the Sherman Act, the Clayton Act, and the Federal Trade Commission Act
shall be applicable to the business of insurance to the extent that such
business is not regulated by State law."

A Nebraska statute reads as follows :

"No person shall engage in this State in unfair methods of competition
or in unfair or deceptive practices and acts in the conduct of the business
of insurance. No person domiciled or resident in or resident of this State
shall engage in unfair methods of competition or in unfair or deceptive acts
and practices in the conduct of the business of insurance in any other state,
territory, possession, province, country or district."

Final Examination in Legislation (Law 331); Second Semester 1959-1960 page 3

The O.K. Insurance Company is a Nebraska corporation engaged in the business
of selling health insurance. Licensed only in Nebraska, the Company sells no policies:
through agents, but from its office in Omaha, Nebraska, transacts business by mail
with residents of every state. It solicits business by mailing circular letters to
prospective buyers recommended by existing policyholders. All business is conducted
exclusively by direct mail from the Omaha office; it is from there that policies
are issued, and there that premiums are paid and claims filed.

In I9U6 the Federal Trade Commission issued a regulation interpreting the
McCarran-Ferguson Act. The regulation stated that it had no jurisdiction to enter-
tain complaints of unfair or deceptive acts or practices of any insurance company
domiciled or licensed in a state which by law prohibited unfair or deceptive acts
or practices of the company in that state and elsewhere in the country. In 19^7,
the Congress re-enacted Section 2 of the McCarran-Ferguson Act, making no changes
therein except to add a reference to the "Robinson -Pa tman Anti -Discrimination Act"
to the proviso in (b). In 1951 the Federal Trade Commission, under its statutory
power to promulgate rules and regulations, repealed its interpretive regulation
of Section 2 and adopted a new regulation to the effect that it did have juris-
diction to entertain complaints and to issue cease and desist orders to prevent
unfair or deceptive acts or practices of insurance companies beyond the borders of
the states in which the companies were licensed.

In 1953, Adams , a resident of Tennessee, purchased a policy through the mail
order solicitation of the O.K. Insurance Company. The circular of the O.K. Insurance
Company relied upon by Adams was obviously unfair and deceptive, a fact which became
abundantly clear when Adams's claim under the policy was denied. Adams filed a
complaint with the Federal Trade Commission, which investigated the charge and after
a hearing issued a cease and desist order prohibiting the O.K. Insurance Company
from making certain statements and representations found by the Commission to be
deceptive and misleading in violation of the Federal Trade Commission Act. On
judicial review, the Court of Appeals set aside the order. The Supreme Court
granted certiorari.

Analyze and discuss the interpretive and other issues and give decision.

h. A state statute reads as follows:

"Sec. 1. It is the public policy of this State that the public
commissions, boards and councils, and the other public agencies in this
State exist to aid in the conduct of the people's business. It is the
intent of this Act that their actions be taken openly and that their
official deliberations be conducted openly.

"Sec. 2. All official meetings at which any legal action is taken
by the governing bodies of the State, counties, townships, cities, villages,
incorporated towns, school districts, and all other municipal corporations,
boards, bureaus or commissions of this State shall be public meetings,
except for deliberations for decisions of the Public Utilities Commission
and the State Pardon and Parole Board, meetings where the acquisition or
sale of property is being considered, and where the constitution provides
that a governmental unit can hold secret meetings.

"Nothing in this section shall be construed to prevent the governing
body of any agency of government from holding closed meetings to consider

Final Examination in Legislation (Lav/ 331), Second Semester 1959-19^0 page k

information regarding employment or dismissal of an employee; provided,
that no final action for employment or dismissal shall be taken at a
closed meeting.

"Sec. 3. Any person violating any of the provisions of this Act
shall, upon conviction, be punished by a fine of not more than $100,
or by imprisonment in the county jail for not more than 30 days, or
both."

The members of the following designated agencies are prosecuted under Section 3
for violating the Act, upon the following facts, respectively:

(a) An employee files a claim against an employer for accidental injuries
suffered under the Workmen's Compensation Act. Public hearings are held by a .
referee and before the Industrial Commission on administrative appeal from the
recommendations of the referee. Upon conclusion of the public hearings, the members
of the Commission meet in closed session to deliberate upon the record. They reach
a decision denying the claim and notify the parties by mail.

(b) A state university whose affairs are administered by an elective board
of trustees, upon charges filed by the president of the university that a faculty
member has abused his academic responsibility by publishing in a student newspaper
a statement endorsing premarital relations for responsible and mature students,
holds a secret hearing upon such charges. If the board concurs in the charges, the
faculty member may be dismissed. The decision of the board is thereafter announced
in a regular public meeting as a result of deliberations held secretly following
the hearing.

(c) The same board as in (b), composed of 9 members, organizes three committees
of three members each, to consider and make recommendations to the full board on
subjects not within the statutory exceptions to the public meeting requirement.

The three committees meet separately in closed sessions and discuss and deliberate
the matters fully. Each committee reaches decisions and at a following public
meeting of the board, the recommendations of each committee are formally adopted by
the board, with due formality, but with no discussion or deliberation.

Analyze the interpretive issues of the foregoing problems and give decision
in each case .

5. Section 1-10 of the Public Assistance Code of Illinois establishes a one-
year state residence requirement for eligibility for general assistance to needy
persons. General assistance grants are payable from funds raised locally as
implemented by state appropriations. Since World War II there have been large and
continuing migrations of needy persons from southern states into the larger cities
of northern states, especially New York, Ohio, Michigan, Pennsylvania, and Illinois.
After establishing residence eligibility, it is alleged that many of these people
become recipients of general assistance. Assume that you are a lawyer and member
of the Illinois General Assembly. Representative Jones of Chicago introduces the
following bill, explaining that the condition attached to the appropriation is the
result of information that he has that it is the prevalent practice of southern
states and local governmental units therein to encourage migration of needy residents
by paying their costs of transportation to northern cities:

Final Examination in Legislation (Law 331), Second Semester 1959-I960 page 5

"A Bill

"For An Act making an additional appropriation to the Illinois
Public Aid Commission for the purpose of meeting the state's general
assistance obligations under the Public Assistance Code of Illinois."

/Enacting Clause (assume in proper form)_/

"Sec. 1. In addition to the other sums heretofore appropriated
for such purpose, the sum of $35,000,000 is appropriated to the Illinois
Public Aid Commission for the purpose of providing general assistance
grants to needy persons as provided in the Public Assistance Code of
Illinois. No portion of this appropriation shall be used to pay general
assistance to any person hereafter establishing a residence in this
State whose costs of transportation into this State are paid in whole
or in part by another state, territory, dependency or possession, or by
any municipal corporation or political subdivision of such other state,
territory, dependency, or possession."

Analyze and discuss the policy and legal issues sugggested by this proposed
legislation and on this basis, as a lawyer and legislator, how would you cast your
vote?

FINAL EXAMINATION IN MORTGAGES (Law 3U2)

Second Semester 1958-1959 Professor Holt

TIME: 3 hours

Give reasons for your conclusions, but avoid impertinent discussions. Be
coherent. Give due weight to statutes of the types considered in the course. You
may make reasonable assumptions of fact, but be sure to state your assumptions
clearly.

1. Pursuant to an agreement between A, B, and C, A and B purchased a tract of land
from V and took a deed from V naming them (A and B) as grantees. According to the
agreement between A, B, and C, C was to pay A and B one-third of the purchase price
within three years and was to have a one-third interest. Three years and three
months later C tendered A and B an amount equal to one -third of the purchase price
and interest and demanded a deed conveying to him a one-third interest. A and B
refused to comply. Rights of C?

2. M gave a lease to L of Tract X, which M owned in fee. While the lease still
had six years to run, M gave a trust deed of Tract X to E to secure a loan made
by E to M and evidenced by M's negotiable note, payable to the order of M and
endorsed in blank. Prior to any default on the trust deed, M and L made an agree-
ment in writing whereby in return for an immediate cash payment to M by L, M agreed
to an immediate cancellation of the lease, although it still had five and a half
years to run. One month after such cancellation of the lease, M defaulted on his
trust deed. Rights of E?

3- M gave a first mortgage on Tracts X and Y to E. M gave to E-2 a second mortgage
on Tract X and a first mortgage on Tract Z. Still later M gave E-3 a second mortgage
on Tract Y. All mort sages were given to secure loans and l^ad the same maturity
date. Assuming that all parties in interest are before the court in suits to fore-
close the mortgages and that the suits are consolidated for trial, discuss when and
how marshalling should be applied, (it is to be assumed that all mortgages were
promptly recorded.)

U. Statutes of State X provide that "every conveyance of real estate within this
state . . .which shall not be recorded as provided by law shall be void as against
any subsequent purchaser in good faith and for a valuable consideration of the
same real estate or any portion thereof whose conveyance shall first be duly recorded.'
The statutes further provide that 'the term 'conveyance' shall be construed to
embrace every instrument in writing by which any estate or interest in real estate
is created, alienated, mortgaged or assigned or by wnich the title to any real
estate may be affected in lav or equity; and the term 'purchaser' shall be construed
to embrace. . .every assignee of a mortgage ..."

M mortgaged Tract 1 in State X to E to secure his negotiable note, and the
mortgage was promptly recorded. Before maturity of the note E indorsed
the same to A for value and also assigned to A in writing the mortgage, but such
assignment was never recorded. Later M conveyed his interest in the land to E by
deed that was promptly recorded, and E conveyed in fee to P, a bona fide purchaser.
Rights of P and A?

■

Final Examination in Law 3U2, Second Semester 1958-59 Page 2

5. In 1931*, in return for a loan of $4000 by E to M, M gave E his negotiable
promissory note due July 1, 1936, payable to his own order and indorsed in blank,
secured by a trust deed to E of Tract X, which trust deed was duly recorded. In
1935 M conveyed to B, who assumed payment of the encumbrance. Later in 1935 B
conveyed to G, who also assumed payment of the encumbrance. G paid interest on
the note down to 1955, and then by writing agreed with E not to plead the ten-year
statute of limitations on the note and to pay the same in full if he should be
able to sell Tract X. In 1958 G sold Tract X to P by warranty deed for $25,000.

P filed a bill to have the trust deed declared a cloud on title. E filed a cross-
bill to foreclose. (E has never negotiated the $*t000 note.) Result?

6. M conveyed Tract X to B, who assumed and agreed to pay a mortgage on the same
which M had given to E to secure M's negotiable note. B in turn conveyed the tract
to G, who also assumed and agreed to pay off the mortgage. At maturity of the note,
for a valuable consideration, E granted to G an extension of time without the
knowledge or consent of either M or B. G failed to pay at the end of the extension
period, and on foreclosure Tract X was sold for less than the amount of the mortgage
debt. All deeds and mortgages were promptly recorded. Discuss the rights and
liabilities of the parties .

7 ■ A statute of State X provides that "the recording of an assignment of a mortgage
shall not, in itself, be deemed notice to the mortgagor, or his heirs or personal
representatives, so as to invalidate any payment by them, or either of them, to
the mortgagee . " M gave his negotiable note to E in return for a loan secured by a
mortgage. Before maturity E indorsed and transferred the note to P, a bona fide
purchaser for value, together with a written assignment of the mortgage. Later,
but before maturity of the note, M paid E the full amount of the note, without
demanding production of the note or mortgage deed, and E gave M a satisfaction-piece
acknowledging payment in full. At maturity of the note P consults you as to his
rights. What advice?

FINAL EXAMINATION IN MORTGAGES (Lav; 3U2)

Second Semester I959-I960 Professor Holt

Time : 3 Hours

Give reasons for your conclusions. Pay due consideration to statutes of the
types considered in the coarse. Any reasonable assumptions of fact should be
clearly stated. Expect no credit for rambling and impertinent dissertations.

1. By statute in State X every conveyance of real estate by deed, mortgage
or otherwise is to be recorded, and every conveyance not so recorded is void as
against any subsequent purchaser in good faith and for value. E, mortgagee of a
mortgage given by M to secure his negotiable promissory note for a loan of $5^00,
before maturity sold the note and mortgage to P by indorsing the note in blank,
executing on the back of it an assignment of the mortgage, and delivering the
note and mortgage to P. No assignment of the mortgage was ever recorded, but the
mortgage had been duly recorded on the day of its execution. Alter M had default-
ed at maturity, E caused foreclosure proceedings to be instituted by advertisement.
He purchased at foreclosure sale, recorded the sheriff's certificate of purchase,
and after the expiration of the period of redemption from foreclosure sold to B,
who relied upon E's record title, (it is to be assumed that E had wrongfully
foreclosed without P's knowledge or consent, but the foreclosure sale was not
without legal effect; in State X, S would hold on constructive trust for P. )

B gave E a purchase -money mortgage for a part of the price, which was duly re-
corded. E assigned this purchase-money mortgage for value to G, who recorded
a formal written assignment. P seeks your advice as to a suit to set aside the
foreclosure of the original mortgage, the later deeds, the B mortgage, and the
assignment thereof to G, and then for the foreclosure of the mortgago assigned- to
him (P). V/hat advice as to the rights and liabilities of the parties?

2. M mortgaged a house and lot to E to secure a loan. Later M mortgaged the
same house and let to E-2 to secure a second loan. Both mortgages were duly and
promptly recorded. M remained in possession and sold the furnace in the house to

B for cash. B removed the furnace. E-2 consults you as to his rights. What advice?

3. In State X land was mortgaged by M to E to secure a loan. On M's default
there was a foreclosure, and at sale on foreclosure E purchased and received from
the sheriff who made the sale a certificate of purchase. One week before the
expiration of the period afforded M for redemption, M borrowed from L the amount
needed for such redemption and, having made redemption, delivered to L his prom-
issory note for the amount advanced, due one year after date. At the same time

M gave L a writing signed by M which stated that L had made tne loan in order to
enable M to redeem; that as security for repayment of the advance by L, M had
deposited with T in escrow a deed from M to L to be held until payment of the
debt; and in the event of M's failure to pay the debt at maturity, the deed was
to be delivered to J$L. Such a deed was executed and delivered in escrow to T.
'■Jhen the note to L was not paid at maturity, T delivered the deed to L. One week
later M tendered L the amount of the note and accrued interest and demanded a return
of the deed from M to L, but was refused. M's rights?

h. M mortgaged Lots 1, 2 and 3 to E. Later M gave a second mortgage on
Lots 1 and 2 to E. Still later M gave a third mortgage on Lots 2 and 3 to E-2.
All mortgages were duly recorded. On foreclosure of the second mortgage there was
a foreclosure sale, and B was the purchaser, subject to the first mortgage. No
attempt to redeem was made by anybody during the redemption period. £ filed
a bill to foreclose the first mortgage. B and E-2 were made parties to the pro-
ceeding. Discuss the rights of the parties.

Final Examination in Mortgages (Law 3^2)

Second Semester 1959-1960 Page Two

5- M mortgaged 1000 acres to E. M then sold the 1000 acres to A subject to
the mortgage. A conveyed 250 acres of the tract to B, who did assume payment of the
mortgage debt. B later conveyed the 250 acres to C, who also assumed payment of
the mortgage debt. A conveyed the remaining 750 acres to D, warranted title
against the mortgage, and took a junior purchase -money mortgage for the purchase
price. C failed to pay the assumed debt, and E foreclosed and caused the land to
be sold on foreclosure sale to X. A thereby became liable on his warranty to D
and lost the value of his junior mortgage. Rights of A?

6. M mortgaged a tract of land in Illinois to E. The mortgage was foreclosed
in May 19^9, and at a foreclosure sale on June IT, 19^9, E purchased and received

a certificate of purchase. E obtained deficiency judgment against M on June 25,
19^9- In March 1950 M conveyed all interest in the premises to G, who redeemed
in April 1950 and received a certificate of redemption. In May 1951 "the premises
were sold on execution issued on the deficiency decree that E had obtained against
M on June 25, 19^9- E purchased at the execution sale. G was in possession of
the premises. E sued G in ejectment. What disposition?

7. In 1911 M mortgaged a tract of land in Illinois to E to secure M's
negotiable promissory note due August 1, 1912. The mortgage was promptly recorded
on the date of its execution and delivery, July 31, 19H» January 2, 19l6, the
note and mortgage were assigned to A. Interest was paid regularly semi-annually
until July 1, 19^3, when A surrendered the note of M due August 1, 1912, in return
for the follo\;ing instrument delivered by M:

"July 1, 19^3
"$5,000.

Twelve months after date for value received I promise to
pay to the order of A the sum of five thousand dollars, with
interest thereon at the rate 7$, per annum, payable annually.
This note is secured by a real estate mortgage of July 31, 1911,
on . . . "

and then followed a brief description of the land by quarter-section, township,
and range, and the instrument was signed by M. M failed to pay the instrument at
maturity on July 1, 19M+. Rights of A?

(in answering assume tnat nothing was ever filed for record to provids for
the renewal or extension of the instrument of mortgage of 1911.)

FINAL EXAMINATION IN MUNICIPAL CORPORATIONS (LAW 3^0 )
Second Semester 1958-1959 Professor Kneier

1. Plaintiffs seek an injunction against enforcement of an ordinance of the city
of R relative to the use of certain streets on vhich they are abutting owners
and tenants. The city had by ordinance carried out an agreement with the state
as to widening and paving the street (a state hi: .way) which contained the
following provisions:

"(a)Trat it (the city) ••Jill not permit parking in, along, or upon said street
or highway except as permitted by written authorization from the State High-
way Department .

"(b)That no advertising signs, or signboards, or devices will be permitted with-
in the right of way cf sa Ld street or highway, and that no directional,
minimum speed or traffic control signs will be placed in said right of way
by the city without written approval from the State Highway Department.

"(c)That on said street the city will regulate and control automobile parking
lots, where eight or more motor vehicles are kept or stored at any one time
for a consideration, so that neither the owner of such parking lot or his
agents or employees shall drive, park, stand, stop or store any vehicle
parked or stored in any such parking lot on, upon or across any public
street, public sidewalk, public alley or other public place, or drive or
move any vehicle parked or stored in any automolile parking lot, except
within the property lines of such automobile parking lot."

Your decision with reasons .

2. Plaintiff, a gas company, located its lines in defendant city with the consent
of the city, and in county highways pursuant to a county franchise . Defendant
city in carrying out a sewer outlet construction in an unincorporated area of
the county made it necessary for plaintiff to relocate some of its pipes in the
county highways. Plaintiff seeks to recover from the city the expenses incurred
in relocating its pipes .

Your decision with reasons.

3- A zoning ordinance prohibits the operation of automobile parking lots in areas
zoned for residences, and defines a parking let as a lot, whether open or cov-
ered, in which eight or more motor vehicles are kept at any one time for a
consideration. The ordinance made violations punishable by fine or imprison-
ment, or both. M was tried in county court for operating a parking lot in
violation of the ordinance, and was acquitted on the ground that the ordinance
did not forbid the parking lot operation in which he was engaged. The city
appealed and the appellate court reversed on the same legal question. A peti-
tion for rehearing on the ground that the county court judgment was an acquittal
on a criminal charge and, thus, not appealable, was denied.

On appeal to the Supreme Court of the state, what decision? Reasons.

^. Action to enjoin city officials of the city of X from changing the city bound-
aries on the ground that the statute under which such action is taken is un-
constitutional. The act is applicable to all cities in the state in which the
council, after public hearing, decides that there is danger of racial conflict

Final Examination in Law 3^0, Second Semester 1958-1959 Page 2.

unless certain areas or sections now within the city are excluded by a change
in boundaries. Upon adoption of the act as provided above, the council is given
power by the act to exclude by ordinance such areas or sections as it sees fit.
Before the action excluding such areas was taken by the council of the city of
X, there were ^00 qualified Negro voters in the city; after the action was
taken there were only five qualified Negro voters. Before the exclusion there
were 600 qualified white voters; after the exclusion the number of qualified
white voters remained the same. The state constitution prohibits special
legislation granting power to cities.

Should the injunction be granted? Reasons .

Action for damages for personal injuries and damages to the automobile of
plaintiff brought against the city of T, a municipal corporation, and W, an
employee of the city of T. Plaintiff's injuries and the damages to his auto-
mobile were caused by defendant >.-J while driving a garbage truck belonging to
the city of T out of a driveway in order to go to a wash rack 300 yards distant
from the lot. W made a left turn contrary to municipal ordinance and his
negligence was the cause of the accident. The truck involved had completed the
work for the day and had been taken to a storage lot maintained by the Refuse
Department some 300 yards from the wash rack. In this storage lot drivers left
their trucks, and W, a truck washer, took them to the wash rack and washed them
inside and out. The wash rack was used also for washing other cars belonging
to the city but they were under the supervision of the Superintendent of the
Refuse Department .

The trial court overruled the motion of each defendant for a directed verdict.
The city and W appeal from a verdict for the plaintiff. Your decision with
reasons .

FINAL EXAMINATION IN MUNICIPAL CORPORATIONS (Law 3*+0)
Second Semester 1959-1960 Professor Kneier

TIME: Three Hours

1. Action against the City of C for the amount of a reward offered by its council
for the apprehension and conviction of incendiaries. In this state, which is not a
home-rule state, there are no statutes specifically authorizing municipal corpora-
tions to offer a reward for the detection, apprehension, or conviction of offenses
against the criminal laws of the state. The statutes do provide that municipal
corporations may "pass and enforce all necessary police ordinances" and "to do

all such things as it may deem proper for the prosperity, quiet and good order
of the city." A statute provides that a "majority vote of the members of the
council elected" is necessary for any action to be taken. The council was composed
of fourteen members but when the action offering the reward was taken, there was
one vacancy. The vote on offering the reward was seven in favor and six opposed;
the mayor declared the resolution offering the reward was passed.

Your decision with reasons.

2. Action by plaintiff, who owns property abutting on a street, to enjoin the
defendant from operating a newsstand on the sidewalk in front of plaintiff's
property for the sale of newspapers, magazines, pocket books, and comic books.
The street was originally dedicated to public use in 185^ by deed of dedication,
and in 1901 it was widened as a result of condemnation proceedings. Defendant's
newsstand is located partly on the land which was acquired by deed of dedication
and partly on that part of the street acquired by condemnation. No action has
been taken by the city relative to newsstands on the streets but the custom of
having them has existed for over eighty years. The defendant started his news-
stand at the location in dispute inl932 while he was a child and sold from a
small wagon. In 19^ he built a newsstand four feet long, five feet high, and
twenty-four inches wide. It was gradually expanded to its present size of nine
feet long and six feet high. Plaintiff acquired the property in front of which
the newsstand is located in 19^8 for $100,000 and has spent approximately
$250,000 in remodeling. He operates a clothing store for men.

Your decision with reasons.

3. An amendatory zoning ordinance was enacted by the city council of C for the
purpose of changing the zoning of an area from single family residential to an
apartment district. The amendment received the required affirmative votes of five
members of the council, including the vote of one councilman who owned land in the
area affected by the amendment which would increase in value $200,000 because of
the zoning change. Plaintiffs, owners of property in the zone near that of the
member of the council, filed suit to have the amendatory ordinance declared in-
valid and to enjoin its enforcement.

Your decision with reasons.

^. Action by plaintiff, superintendent of schools, against defendant, a school
district, for breach of a contract of employment. The plaintiff had been employed
first in 19^5 °a a two-year contract, and then on a three-year contract. In
April 1950 the parties entered into a new contract for one year, to take effect
July 1, 1950, at the end of the then existing three-year contract. On July 5,
1950, the new one-year contract having been in operation five days, at a special
meeting of the board of education, at which all members were present, a resolution
was passed by a vote of three for and two against, hiring the plaintiff for three

Final Examination in Municipal Corporations (Law 3^0) Second Semester 1959-1960

Page 2

years beginning July 1, 1950 • The contract was duly executed the following day,
July 6, 1950. At the school election on July 11, 1950, two new members of the
board were elected, replacing two members who were defeated. On July 12, 1950,
the board organized for the ensuing year, and by majority vote asked the plaintiff
to resign. He refused and on July 15, 1950, sent a written communication to the
board, tendering his services under the contract of July 6. In reply, and in
writing, the board informed the plaintiff on July 21, 1950, that his services
as superintendent were at an end, and directed him to deliver up to the secretary
of the board his keys and other school property.

Plaintiff remained ready and willing to perform his contract, and at the end
of five months brought this action. Your decision with reasons.

5. This is a proceeding to determine the validity of bonds proposed to be issued
in order to finance the acquisition of off-street parking facilities in a city
which has reached the constitutional debt limit. The bonds, which are payable
"solely from the net operating earnings of the proposed parking facilities",
provide for a conveyance in trust to a private trustee of the facilities proposed
to be acquired as further security for the bondholders. Action was taken by the
city under a state law authorizing the issuance of revenue bonds for the acquisi-
tion of off-street parking lots by cities having a population of not less than
25,000 and not over 500,000. The council action to proceed with the acquisition
of off-street parking facilities as provided in the statute was five to four.
One of the councilmen is the brother of the operator of a downtown department
store who is interested in having more parking facilities in the central section
of the city.

Assume Illinois constitutional provisions are applicable. Are the proposed
bonds valid? Your decision with reasons.

FINAL EXAMINATION IN OIL AND GAS (LAI.7 3UI)
First Semester 1959-1959 Professor Warren

TIME: k HOURS

Instructions: Please do not write your name on the examination booklet.
Please give some thought to your English usage in writing this paper.
Lea/e a space between paragraphs, and maintain reasonable margins.
Make your handwriting legible.

1. State A enacted the following statute in 19^-5:

"The production of natural gas in State A in such manner and under
such conditions and for such purposes as to constitute waste is hereoy
prohibited.

"The term 'waste1 as herein used, in addition to its ordinary mean-
ing, shall include economic waste, underground waste and surface waste.
Economic waste as used in this act, shall mean the use of natural gas in
any manner or process except for efficient light, fuel, carbon black
manufacturing and repressuring, or for chemical or other processes by
which such gas is efficiently converted into a solid or a liquid sub-
stance. The term 'common source of supply' wherever used in this act,
shall include that portion lying within this state of any gas reservoir
lying partly within and partly without this state. The term 'commission'
as used herein shall mean the state corporation commission of the state
of A, its successors, or such other commission or board as cay hereafter
be vested with jurisdiction over the subject matter of this act

"Whenever the available production of natural gas from any common
source of supply is in excess of the market demands for such gas from
such common source of supply, or whenever the market demands for natural
gas from any common source of supply can be fulfilled only by the produc-
tion of natural gas therefrom under conditions constituting waste as
herein defined, or whenever the commission finds and determines that
the orderly development of, and production of natural gas from, any
ccmrnon source of supply requires the exercise of its jurisdiction, then
any person, firm or corporation having the right to produce natural gar
therefrom, may produce only such portion of all the natural c:is that
may be currently produced without waste and to satisfy the market demands,
as will prrmit each developed lease to ultimately produce approximately' the
amount of gas underlying such developed .lease and currently produce pro-
portionately with other developed leases in said common source of supply
without uncompensated cognizable drainage between separately-owned,
developed leases or parts thereof. The commission shall so regulate the
taking of natural gas from any and all such common sources of supply
within the state as to prevent the inequitable or unfair taking from
such common source of supply by any person, firm or corporation and to
prevent unreasonable discrimination in favor of or against any producer
in any such common source of supply. * * *

"The commission shall promulgate such rules and regulations, ss
may be necessary for the prevention of waste as defined by this act,
the protection of all water, oil or gas-bearing strata encountered in any
well drilled in such common source of supply, ascertaining the several
factors entering into the determination of the productive capacity of
each well, the total productive capacity of all wells in the common
source of supply, the establishment of such other standard or standards

Final Examination in Oil and Gas, Law 3^1, First Semester 1958-1959 Page 2

as the commission may find proper to determine the productive capacity
of each well and of all wells in such cannon source of supply, and as
the ccmnission may find necessary and proper to carry out the spirit
and purpose cf this act: * * *."

In 19^-8 the royalty owners in the huge Griffith field in State A filed a
petition with the Conservation Commission setting forth in great detail feet:, which
may be summarized as follows: The Griffith field is one of the largest gas produc-
ing fields in the world; supply from the field was greatly in excess of the capacioy
of the pipe lines transporting gas from the field; many producers had not been able
to market their gas through any of the existing pipe lines; prices being paid to
producers varied from four to eight cents per thousand cubic feet; and producers,
in effect, had to accept what pipe line companies offered to pay for the gas.

After due notice and hearing, the Commission decided that the fair and
reasonable value of natural gas at the wellhead in the Griffith field was at least
eight cents per thousand cubic feet, and the taking of gas cut of the field at a
lower price was not conducive to the fulfillment of the purposes of the statute
relating to the conservation of gas and should be prohibited. Therefore, the
Ccmmicsion ordered that the minimum wellhead price of gas be eight cents and that
all purchasers and takers of gas must take ratably trcr: each well in the field.

(a) Is it within the powe?" of the Commission to promulgate this order? Explain.

(b) Does this order further the aims and objectives of conservation as you
understand them? Explain.

(c) Discuss briefly what alternative solutions to this problem the legislature
and/ or the conservation agency might have adopted.

2. (a) In 1920 X purported to convey all her mineral interest in a certain tract
to A. In 1921 A leased the premises for oil and gas to L, and the lease was duly
recorded. A extended the lease several times; finally, in 1936 L drilled a pro-
ducing well which has continued to produce in paying quantities. In 19^-2 it was
discovered that in 1919 X had conveyed half of her mineral interest to Y end that
the conveyance was duly recorded. A claims that he is entitled to all the royalties
from the well and brings suit to enforce his claim. Should he win? Explain. You
may assume that the relevant statute of limitations in this jurisdiction is twenty
years. Y asserted no claim to the minerals frcm 19 19 to 19I+2.

(b) In 1920 Parsons went into adverse possession of a tract of land. In 1930
he sold the surface of the land to Eaker and reserved the minerals. Eaker has
remained in possession of the surface until the present, but Parsons has never con-
ducted operations on the land to recover any of the minerals. The land had pre-
viously belonged to Stables. \Jho owns the minerals today? Explain. You "ay assume
that the relevant statute of limitations in this jurisdiction is twenty years.

3. Mr gee held leases on tracts A and B. Each lease had a primary term of ore year
with the usual "thereafter" clause and "unless" drilling clause. Shortly after

the lea^e on tract A was executed, Magee assigned it to Roe, reserving a l/l6th
overriding royalty. At the time of the assignment, Roe and Magee entered into a
written agreement wherein Roe undertook to drill a well on tract A to the Eartles-
ville sana within six months. The well was drilled within this period and was a
producer.

Final Examination in Oil and Gas, Law 3^1, First Semester 1958-1959 Page 3

A month after the ahove -mentioned assignment, Magee assigned the lease on
tract £ to Roe, the only consideration being the reservation of a l/l6th overriding
inter.3st by Magee. At the end of the primary term of the lease on tract *3, Roe had
neither drilled nor paid delay rental. After filing for record a release of the
original 3 ease on tract B, Roe obtained a new lease on the tract from ^he owner and
drilled a producing well thereon. The new lease made no mention of any overriding
interest in favor of Magee.

Magee brought an action to have his overriding interest recognized by Roe
as a charge on the second lease on tract B. On trial Magee introduced testimony
of some rather vague oral statements by Roe to the effect that Roe promised to drill
on tract B within the one-year term of the lease. Roe denied making any statement
at all. The trial court held for defendant Roe.

(a) If this case were appealed, what disposition should be uade by the
appellate court? Why?

(b) Would your result in (a) be the same or different had there been a
clause in the assignment agreement requiring Roc to give Magee notice beiore re-
leasing che lease on tract B, assuming that no notice was given? Why?

(c) Would your result in (a) be the same or different had there been a
clause in the assignment agreement giving Magee an overriding interest in any
"modifications, extensions, cr renewals" of the original lease on tract B? Why?

(d) Draft a clause tha4: will clearly protect Magee against the risk of
having his overriding interest "washed out."

k. Feezor leased a 6^0-acre tract of land to Sell. A standard oil and gas lease
form was executed providing for a primary term of five years, an "unless" drilling
clause, and the usual one-year exploratory period. The cash bonus for the lease
was $6Uo, and the delay rentals were $1 per acre. Three hundred feet southwest of
the southwest quarter >of the tract, a producing well was drilled which was chaining
some oil from f-.szor1 s land. This well was completed three years after- Feezor and
Sell entered into their lease.

(a) Assume that in the first year of the lease Sell drilled a producing well
on the northeast quarter of the lease. This well promised to produce enough in a
few years to repay the cost of drilling and equipping it, as well as to show a
profit over and above the cost of operating it. For about a year before suit was
brought, Feezor demanded that Sell must drill another well, but Sell has refused.
Has Sell violated any of Feezor' s rights? If so, what remedies may Feezor employ
against Sell, and what must Feezor prove to recover on these remedies? You may
assume that Fee:or's Gait was brought four and one-half years after- the date of

th" lease. Please answer this question as you think the courts of Illinois, Texas,
and Oklahoma would answer it.

(b) Assume that Sell had not drilled a well but had paid the delay rentals
at the proper times. Has Sell violated any of Feezor' s rights by refusing to
drilj. after Feezor repeatedly demanded a well? If so, what is Feezor' a lemedy and
what must he prove to recover? Answer assuming that Feezor brought suit: (i) two
and one-half years after entering into the lease; (ii) three and one-half years
after entering into the lease; and (iii) four and one-half years after entering into
the 'ease. If the law of the three jurisdictions mentioned in part (a) varies on
these points, indicate the differences in their views-

(c) Would it make any difference in your answers to parts (a) and (b) if
Sen were the lessee who drilled the well southwest of the tract in question?

-

Final Examination in Oil and Gas, Law 3^1, First Semester 1958-1959 Fage k

5- (a) Draft an instrument granting to X a one-eighth mineral fee interest in
tract A. Tract A is presently subject to a valid oil and gas lease. Exactly what
interest, if any, does X take in any royalties, rentals, or bonuses payable under
the present or future leases? Must he join in any future leasing?

(b) Draft an instrument granting to X a one-sixteenth perpetual non-
participating royalty interest in tract B. Tract B is presently subject to a v^.lid
oil and gas lease. Exactly what interest, if any, dees X take in any royalties,
rentals, or bonuses payable under the present or future leases? Must he join in
any future leasing?

NO.

MIDSEMESTER EXAMINATION IN PERSONS (Law 333)
October 27, 1958 Professor Carlsten

IMPORTANT: You will find a number in the upper right-hand corner cf this pege.
This will be your examination number. Grading will be made \/ithout knowledge
of your name. A list of the members of this class will be passed around. Place
your examination number in the space opposite your name on this list. To not
write your name on either this question sheet or the examination booklet. Answer
questions on the basis of Illinois law; this means the statutory and common law
which would be applied by the Illinois courts.

1. "Jimmy the Con" was a confidence man. He established himself in a
small town under the fictional name of J. R. Morgan and let it be known that be
was interested in making investments. He drove an impressive car which was in
fact purchased by him as a used car on time payments. He opened an office under
the name of Morgan Investment Company. He wooed and married the town banker' s
daughter when she was age 15. Two years after her marriage, she discovered that
he was a criminal, when the F.B.I, found him and removed him to Leavenwoith
Prison to complete a prison term of which he had three years yet to sprve. State
her possible courses of action, the grounds therefor, and the degree to which such
grounds are well founded.

2. An Illinois boy was drafted and sent to a foreign country. In con-
formity with its laws, he there married by proxy a girl who was an Io^ a resident.
Discuss tee validity of their marriage.

3. A boy discovered that the girl he had previously promised to marry
had been a "stripper" in a night club and was a drug addict. May ne lawfully
break his promise to marry on these grounds?

Final Examination in Persons, Law 333, First Semester 1958-1959 Page 2

owned a car. W procured a divorce for H' s cruelty. At that time H and W entered
into an agreement whereby H conveyed his interest in the home to W, W conveyed
her interest in the business to H, and H agreed to pay W $100 a month unt_l both
children reached majority.

W thereafter began a real estate agency of her own, but. this was un-
successful. In 1958 she was unemployed and had savings of $10,000 and a car.
She consults you as to whether she has any remedies against H. What is your advics
and why? Would your answer be any different if the above agreement had been
incorporated in the divorce decree? Would it be any different if it had b^en
so incorporated and the $100 monthly payments had been designated as "alimony"?

If W had married before the children reached majority, would s>ie be
entitled to continue to receive the $100 monthly payments?

NO.

FINAL EXAMINATION IK PERSONS (Law 333)
First Semester 1958-1959 Professor Carlstcn

TIME ALLOWED: TWO HCURS

IMFCKTANT: You will find a number in the upper right-hand corner of this page.
This will he your examination number. Grading will he made without
knowledge of your came. A list of the members of this class will be
passed around. Place your examination number in the space opposite
your name on this list. Do not write your name on either this question
sheet or the examination booklet.

Answer questions on the basis of Illinois law; this means the statutory
and common law which would be applied by the Illinois courts, If the
majority view of the common law is different, so indicate. Always state
reasons.

(25 points) 1. H dated W for three years, seeing her regularly at least once a
week. She was invited to his heme and he to hers by their
respective families frcm time to time. He wrote her letters in
which he used words of affection and spoke of the time when they would always be
together. She claimed he promised to marry her but he denied it. She claimed
that in reliance on his promise, she had sexual intercourse with him as a result
of which a child was born, which she has since had to support at a cost of $4,000..
Her medical and hospital bills, including loss of earnings while bearing the child
and recovering her health after birth, were $2,000. The value of the living which
he would have provided her for her lifetime, had he married her, was estimated at
$100,000.

W consults you as to her rights against H, who has since married another.
What is your advice and wny?

(20 points) 2. (a) H agreed in writing to give W $1,CC0 if she married him.

She did so but H refused to perform his promise. W left him and
H obtained a divorce for desertion. May W then recover $x,000

from H?

(b) H maliciously set fire to a building owned by W, his wife.

What actions may be brought against him on account thereof?

(25 por'nts) 3* H accused W, his wife, of committing adultery on November 1, 1956.
She admitted the act and H left home. The following May they
discussed the matter and H returned home to her. W, however,
refused to have sexual relations with H and H left her again in June 1957- Tn July
1958 H brought an action for divorce against W alleging the adulter^ of November 1,
1956, as grounds. W filed a counter claim for divorce on grounds of desertion.
On the above facts, what disposition should be made of the case?

(30 points) 4. H married W in 19U0. Each was a skilled real estate salesman.
They jointly carried on a real estate agency as a partnership
under the name of Brown Associates. By written partnership agree-
ment, H drew down 5Cfa of the profits and W the other 50$. Two children were born.
W still continued in the business but only on a part-time basis, ^om 19^0 to 19!v^
she still continued to receive 50f> of the profits, which she banked or invested in
her own name. During this period H supported the family.

In 1950 H and W jointly owned their house, worth $30,000. H had savings
°f $3,000 and owned a car. W had savings and investments of $35 > 000 and also

NO.

FINAL EXAMINATION IN PERSONS (Law 333)
Summer Session 1959 Professor Carlston

TIME ALLOWED: THREE HOURS

IMPORTANT: You will find a number in the upper right-hand corner of this page.
This will be your examination number. Grading will be made without
knowledge of your name. A list of the members of this class will be
passed around. Place your examination number in the space opposite
your name on this list. Do not write your name on either this
question sheet or the examination booklet.

Answer questions on the basis of Illinois law; this means the statutory
and common law which would be applied by the Illinois courts. If the
majority view of the common law is different, so indicate. Always
state reasons. Do not assume any facts without the professor's per-
mission.

1. (a) A and B, 23 and 21 years of age, respectively, decided to get married dur-
ing a beer party. B left her husband the next day and sued for annulment. She
testified that she was drunk, that she would never have married A unless she was
drunk, and that she remembered the marriage ceremony and all events of that day.

A member of the party testified that he saw A "spike", i.e., render unusually
potent, B's drink. Is she entitled to annulment? Would A be entitled to annulment?

(b) B told A that she was pregnant with his child. B' s father later told A
he would beat him up unless he married B, but B was not then present. A married

B. A afterwards learned that B had been unchaste with others and the child was
not his. Is A entitled to annulment?

2. (a) In above case, 1(b), assume that B denied the allegations of A1 s complaint
and testified that A had given her no aid and that she needed funds for the sup-
port of herself and her child and also for the defense of the suit against her.

Is she entitled to an award of such funds?

(b) In above case, 1(b), assume that A left B as soon as he discovered that
the child was not his and remained away over one year. A then sued B for annul-
ment and B counter claimed with suit for divorce on grounds of desertion. What
result?

(c) Would creditors who had supplied food to B and her child be able to re-
cover the value thereof from A in situations (a) and (b) above? If so, on what
basis or bases of liability?

3. A married B, knowing that she had been previously married. He was under the
belief that she (B) had been divorced. After A's marriage to B, her first husband
obtained a divorce on grounds of B's adultery with A. A had been mistaken in his
belief as to her legal freedom to marry him. A continued to live with B for
three weeks and then left her. Is he entitled to either annulment or divorce?

h. B agreed to marry A in consideration of his written promise to will all his
property to her upon his death. After their marriage B committed adultery with

C. A knew of this and still continued to live with B. B thereafter began to
drink and occasionally stayed away from home as much as a week at a time. A would
receive hotel bills charged by her during her absence and would pay them. When

B was away on one of her trips, A consulted his attorney as to what steps he should
take and what remedies were available to him in the light of these facts, and as
to their effect upon his obligation to will his property to her. He also asked
whether he was liable for the hotel bills. What advice should the attorney give?

'

Final Examination in Persons, Law 333, Summer Session 1959 Page 2

5. (a) A had treated his wife, B, with extreme and repeated cruelty. B left
A and they entered into a separation agreement providing for payment by A to her
of $50 a week for her support, representing one-fourth of A's salary of $200 per
week. B was then pregnant and later had a child, after which B sued A for divorce
and requested an award of alimony of $75 per week. Is she entitled to the alimony
as requested?

Suppose she had instead sued for separate maintenance. Is this remedy avail-
able to her?

(b) After C gave D cause for divorce, they separated and entered into an
agreement providing that C gave D all his real property and all his personal
property in excess of $5,000, which C retained, thereby resulting in a transfer to
D of property having a total worth of $25,000. D then sued C for divorce and was
awarded a decree in her favor, in which, pursuant to the consent of the parties,
the above agreement was incorporated. C's income thereafter increased from $200,
as of the time of the divorce, to the sum of $500 a week and the cost of living
increased by 10$. D filed a petition to modify the decree so as to award her
weekly support of $125- Does she have a good case?

FINAL EXAMINATION IK PLEADING (Law 325)
First Semester 1956-1959 Professor Cleary

INSTRUCTIONS

1. The examination will begin with the 1 o'clock bell and will end with the 5
o'clock bell. Do not read the questions before the 1 o'clock bell, and do not
write after the 5 o'clock bell.

2. Do not write over one page, normal sized writing, in the examination book
on each question.

3- There are seven questions.

k. Write only your name on the first page of the examination book. Begin
answers on second page .

Final Examination in Pleading (Law 325), First Semester 195&-59 Page 2.

1. A truck owned by M and driven by S was in a collision with a car driven by D.
S brought a personal injury action against D, alleging negligence, and recovered.

M then brought a negligence action against D for damages to the truck. Discuss the
effect upon the second action of the judgment in the first action.

2. D Corporation issued 100C bonds of $100C each, due at the rate of 100 bonds per
year for 10 years . The bonds provided that upon failure to pay any bond, vhe holder
of any other bond might elect to declare his bond then due also, although the date
of maturity had not yet arrived. P-l held a bond maturing the first year, which
the corporation refused to pay. P-l then sued, on behalf of himself and all other
bondholders, for the total amount of all bonds. D Corporation filed an answer alleg-
ing that the bonds were not authorized by its directors. P-l demurred. The de-
murrer was overruled. P-l elected not to plead further, and judgment was entered
for D Corporation. The following year P-2 sues D Corporation, alleging that he is
the holder of a bond due in the second year. D Corporation in its answer pleads

the former judgment. P-2 demurs to the answer. What ruling and why?

3. P left his car in D's garage to be repaired. During the night, the garage and
car were destroyed by fire . Should P nave the burden of proving that the fire was
caused by D's negligence, or should D have the burden of proving that the fire was
not due to his own hegliger.ee?

k. A statute of Illinois provides: "If a dog, without provocation, attacks or in-
jures any person who is peacefully conducting himself in any place where he may law-
fully be, the owner of the dog is liable in damages to the person so attacked or in-
jured to the full amount of the injury sustained." D is sued because his dog bit a
two-year-old plaintiff. Who should have the burden of proving provocation or non-
provocation?

5- In an automobile collision case, P seeks discovery from D of the following items:

(a) A photograph of the wrecked cars made shortly after the collision by a
newspaper photographer;

(b) A copy of a report of the collision made by D to the insurance company
insuring his car against damage;

(c) A list of persons witnessing the collision.
D objects in each instance. VJhat ruling and why?

6. In a jurisdiction in which contributory negligence is an affirmative defense,
P's complaint alleges that he was crossing the street, that D was driving his car
and negligently failed to yield the right of way, and that P was injured as a
proximate result of D's negligence. D, as permitted under local rules, filed a
general denial.

At the trial, D offered the following items of evidence :

(a) P ran out in front of D's car;

(b) P was struck by a car driven by X;

(c) P had executed a release of his claim.

P objects to the evidence in each instance. What ruling and why?

?• P sues D for damages from an automobile collision. Claiming that X, who was
driving another car, was responsible for the injury to P and also for damage tc
D's car, D seeks to add X as a party and to file a counterclaim or third-party
complaint against him. P objects. What ruling and why?

FINAL EXAMINATION IN PLEADING (Law 325)

First Semester 1959-1960 Professor Fraser

Time Allowed: 3 l/2 Hours

Instructions

Answer all questions on the basis of Illinois law unless otherwise indicated.
Give reasons for your answers .

1. Plaintiff brought an action against the defendant on a negotiable instru-
ment. The complaint contains the necessary allegations for such an action, and

a copy of the note is attached. How should the defendant plead if he wishes to
show that :

a) Another suit on the same claim is pending between the parties to this
action;

b) The instrument is forged;

c) There is no consideration for the instrument;

d) Defendant was fraudulently induced to sign the instrument.

Explain why each pleading should be used. If the defendant has a choice of
pleadings, so indicate. Discuss each part of this question separately.

2. Do any of the defendant's pleadings in Question 1 require a reply by
the plaintiff? Discuss each part of Question 1 separately.

3- Explain the following terms, and illustrate, if possible:

a) Argumentative denial

b) Recital

c ) Departure

d) Aider by verdict

e) Speaking demurrer or motion

k. Paul, an employee of the Acme Manufacturing Company, was driving one of
its vehicles when it collided with an automobile which was owned and was being
driven by Dave . Paul sued Dave for damages for personal injuries .

a) Dave asserts that he was not negligent, but that the collision was
caused by the negligence of Paul so that Acme is liable for the damage to Dave's
automobile. May Dave make Acme a party to the action? Discuss.

b) Assume that Dave does not try to make Acme a party to the action. May
Acme intervene in order to recover for the damage to its vehicle? Discuss.

Final Examination in Law 325, First Semester 1959-60 Page 2

5. In a personal injury case plaintiff seeks discovery from the defendant
of the following:

a) Names of witnesses to the accident

b) Names of the mechanics who checked the brakes on defendant's vehicle
after the collision

c) Photographs of the scene of the accident taken by a newspaper photographer

d) A statement given by plaintiff after the accident to a claim adjuster
working for defendant ' s liability insurer

Discuss the right to discovery in each case.

Would the result be different if the action were brought in a federal court?
Discuss .

6. Paul brought an action against the David Corporation for injuries which
he received in an automobile accident. Paul alleged facts to show that he was
injured as a result of the negligence of Able on January 1, 19&0, that Able was
the agent and employee of the David Corporation, and that Paul had exercised due
care for his own safety. He also alleged his damages. Therefore, he asked

for judgment against the David Corporation. Assume that the complaint is sufficient.

The David Corporation filed an answer which consisted of a specific denial
that Able was the agent of the defendant corporation, and a plea of contributory
negligence on the part of Paul.

The defendant, the David Corporation, then filed a motion for summary judg-
ment to which was attached the following instruments :

a) An affidavit by Charlie Dog, the personnel manager of the David Corpora-
tion, in which he stated that Able had been discharged on December 30; 1959> for
drinking, and that he had been paid all wages which were due him.

b) An affidavit by Easy Fox, the service supervisor of the David Corporation,
in which he stated that the truck which was being driven by Able was removed from
the lot of the defendant corporation without permission sometime after 4:00 o'clock
p.m. on December 31, 1959-

c) An affidavit by George How, a police officer who reached the scene of the
accident shortly after it occurred, in which he stated that Able was intoxicated
when he saw him.

The plaintiff, Paul, filed an affidavit by Item Jig, another police officer
who went to the scene of the accident with George How, in which Item Jig stated
that Able had stated to him that the truck belonged to the David Corporation and
that he worked for the David Corporation. It also was averred that Able had on a
pair of coveralls on which were printed the words "David Corporation.'

How should the court rule on the defendant's motion? Explain the reasons
for your answer .

NAME No .

MIDSEMESTER EXAMINATION IN PROPERTY A (Law 307)
November 3> 1958 Professor Cribbet

Time: Sixty Minutes

Answer all questions in the space provided. The relative grading wight is indicated
in each instance. Please write legibly and succinctly.

I.
(lU points - 2 points for each part)

Mr. Dohme owned stock which was kept in a safety deposit box in Chicago. He
was residing in Decatur. On his wife's birthday, he wrote out and handed to his
wife, in the presence of the entire family, the following paper:

"Decatur, 111., Oct. 17, 1957
"I give this day to my wife, Sara I. Dohme, as a present for her (h6)
forty-sixth birthday (500) five hundred" shares of American Sumatra Tobacco Company
cemmon stock.

Leopold Dohme"
Mr. Dohme died six days later. His wife now claims the stock as her own. A
son, as executor, claims the stock for the estate.

1. Was there a valid gift to the wife? Why or why not?

2. Would the case for a gift to the wife be stronger or weaker if the 500 shares
of stoci had been in Mr. Dohme 's possession in his Decatur home at the time the
paper was handed to M.i 3. Dohme? Why?

Midsemester Examination in Property A, Law 307, November 3, 1958 Page 2

3. Would the case for a gift be stronger or weaker if the shares had been physical^
transferred to Mrs.Dohme at the birthday celebration? Why?

k. Ass,Tme the original facts, except that the paper seated: "I will r;ive or my
wife, etc." Dohme then died with the stock still in Chicago. Would that be a valid
gift? Why or why not?

5. Assume the original facts, except that no paper was involved. Mr. Lohme,in firoat
of the entire faailv., stated: "Darling, for your birthday I am giving you five
hundred shares of that American Sumatra stock. I don't have it with me now, but as
soon as I can get to Chicago I will give it to you." If you represented the wife
and claimed that a gift had been made, what would be your best argument? Explain.

Assume the original facts, except that two days following the alleged gift Mr.
DcLmr. h-„d a quarrel with his wife and demanded the return of the paper saying,
"I've changed my mind, you she-witch; you'll never get the stock. He did in
fact t£:ure the paper and tore it to pieces. He died four days la^ar.

Page 2

Midsemester Examination in Property A, Law 307, November 3, 195^ Page 3

6. If you represented the estate, what argument would you make against the gift?
What additional facts would you try to show?

7. If you represented Mrs. Dobine, what argument would you make for the gift?

II.

(6 points)

In Urbana, Illinois, in the summer of 1958, a group of boys were playing base-
hall on a large lot owned by the father of one of the boys. An excepticraily long
"Mickey Mantle drive" carried the ball to the adjoining lot and into a vegetable
garden. One of the boys, A, racing for the ball, noticed a gallon milk carton nf
the waxed paper variety and picked it up along with the ball. When he returned to
the playing lot, he tossed the carton high in the air and a green paper fluttered
out. E, another boy, seized the paper, which turned out to be a one-thousand
dollar bill.

Subsequent investigation showed that the adjoining lot was owned of record
(i.e., paper title as disclosed by the records in the county cour thjuse) by C.
C was living in Mississippi and had not been back to Urbana since ".9^9- 2 ^ad use<i
the plot as a garden since 1950 and had paid the taxes since 1951- V had paid X
$100 for the lot in 19^9 and had entered under X1 s oral authority. Tx in fact had
no valid claim to the lot.) C read about the above events in the local newspaper
and returned to Urbana following the finding of the bill. Intensive investigation
failed to disclose how the bill happened to be in the carton and on the particular
property.

A, B, C, and D all claim the one-thousand dollar bill. Who has the best claim
to it? Why?

(Lines for answer are on the following page)

Page 3

Midsemester Examination in Property A, Law 307, November 3, 195^ Page k

(Answer to Question II to be written here)

*age h

.- ...

NAME NO.

FINAL EXAMINATION IN PROPERTY A (Law 307)
First Semester 1958-1959 Profensor Cribbet

TIME: h HOURS

This examination consists of four questions. Question I should
be answered in the examination booklet. The remaining questions
are to be answered as indicated. Since the midsemester examina-
tion counted twenty points, this final examination will be graded
on a scale of eighty points. The relative grading weight is in-
dicated in each instance. Please write legibly and succinctly.

I (30)

This question is designed to test your ability to analyse a fairly
complicated fact situation and then organize your answer into a
coherent and usable memorandum.

Harry Grant and Mabel, his wife, were conveyed an estate in Blackacre,
a 360-acre farm located in Champaign County, Illinois, by Gerald Pinehurct, a
bachelor, who owned the tract in fee simple absolute. This conveyance was made by
a warranty deed in correct form, for an adequate consideration, dated January 3,
1920, and the granting clause read as follows: "Convey and warrant to Harry Grant
and Mabel Grant, not in tenancy in common but in joint tenancy." In 1927, Harry
Grant died intestate, survived by Mabel, his wife; John, a three-year-old son;
and Anne Grant, the mother of Harry. There was never any administration of the
estate of the deceased Harry Grant, and Mabel immediately took possession of Black-
acre and leased the entire tract to James Doan for a period of five years and "for
so long thereafter as said. James Doan shall desire to continue farming the land."
This was a written lease in proper form and the rental provisions called for a
crop share arrangement typical in central Illinois.

In 1935> Mabel Grant remarried and became Mrs. James Johnson III. She
conveyed Blackacre in 19^0 to Maurice Talbot and Dorothy, his wife, by a warranty
deed in correct form and for anple consideration, in which the granting clause read
as follows: "Convey and warrant to Maurice Talbot and Dorothy Talbot for life,
remainder to their heirs." This deed was signed by Mabel Johnson only. Mr. and
Mrs. James Johnson III then moved to Florida. James Dean continued in possession
of the la^d as tenant. In 19^5; Dorothy Talbot died testate, leaving such interest
as she might possess in Blackacre and other property to her only adopted child,
Benjamin Talbot. Her will was properly admitted to probate and the necessary legal
proceedings were correctly carried out. In 1950, Maurice Talbot, widower, deeded
all of his interest in Blackacre to John Hobart by a quitclaim deed in proper form
and for adequate consideration, containing the following granting clause: "Convey
and quitclaim to John Hobart and his heirs for so long as Blackacre is used for
farming purposes." Maurice Talbot died testate in 1952, survived by his adopted
son, Benjamin Talbot, and his (Maurice's) sister, Mrs. James Jordan. By the will
Maurice Talbot left his entire estate to the First Baptist Church of Urb^na,
Illinois. James Doan was still farming the tract.

Champaign has now grown to the extent that Blackacre is near the city
limits and ripe for subdivision development. The officers of the Ea_y Living Acre.:
Corporation hsve cane to you and have asked you to acquire a good title to Black-
acre for them. This means that you must obtain deeds from all of the individuals
having any property interest in Blackacre so that the corporation will obtain title
in fee simple absolute. Prepare a memorandum in which you analyze the property
interest of each individual involved, stating the nature of the estate held, the
reason for your conclusion, and whether a conveyance should be obtained from the
individual.

NAME NO .

MIDSEMESTER EXAMINATION IN PROPERTY A (Law 307)
November 20, 1959 Professor Cribbet

TIME: Sixty Minutes

Answer all questions in the space provided. The relative grading weight
and approximate time you should devote to each question are indicated in
each instance. Please write legibly and succinctly.

I. (3 points; 10 minutes) A, an Illinois resident, imported from Canada two silver

gray foxes, a male and a female, for breeding purposes,
and kept them confined in a pen floored and enclosed by
a plank wall five feet high. Six months later the male fox "gnawed out," escaped,
and was not seen in the vicinity thereafter. A searched for him and set a number of
traps near the place of confinement. Se/eral days later the fox was killed by B in
a thicket seme fifteen miles from A's property. B skinned the fox and preserved the
hide. The hide was seen by A and identified, due to some special markings, as the
skin of A's fox. Which party is entitled to the hide? Why?

II. (7 points; 20 minutes) A owned and operated a hotel in Chicago. He employed

B to decorate several rooms in the hotel and in the
course of the work B found it necessary "to raise up a
rug which was on the floor, and under this rug he found $7^0.00 in the form of
thirty- three old twenty-dollar bills, around which was wrapped a new one-hundred
dollar bill." Evidence indicated that the money must have been there for at least
ten years. A claimed that he knew to whom the money belonged and B gave the roll to
him. Later it developed that A did not know who owned it, but he now claims it for
himself. Litigation appears inminent. Give the argument for A.

Midsemester Examination in Property A, Law 307, November 20, 1959 Page 2

Give the argument for B.

To which party would you award the money if you were the judge in a trover
action brought by B against A, after proper demand made? (No reason need be given.)

III. (10 points; 30 minutes) A was a widow sixty- six years of age. She had been a

lifelong hypochondriac, who invariably appeared to
suffer the symptoms of the disease being currently
discussed in the medical section of Time. Convinced that she was suffering from
cancer of the blood and would soon drift on to a better life, she called B, a nephew,
to her home and handed him a key to her safety deposit box, saying, "B, this is
yours. On my death, you may have the jewelry contained therein." A few days later
she decided that she did not have cancer of the blood at all but had really suffered
from a series of cerebral strokes and would soon die from this cause. She summoned
C, a niece, to the house and gave her a duplicate key (the only one she had left)
to the safety deposit box, saying, "C, this is yours. You may have the jewelry
contained in the box." C replied, "Auntie, you have already given the jewelry to
my brother (B), and I don't want it anyway because I have more jewelry than I can
wear now."

A died the same night from a broken neck when she fell down the stairs of
her house while trying to answer the doorbell. By the statute of descent, all of
A's property passed on her death to her only son D, whom she had not seen for
several years. The jewelry in the box was found to be worth several thousand
dollars. It is claimed by B, C, and D. You. represent D. What are his chances
of inheriting the jewelry? Explain.

(Answer may be continued on page 3)

Page 2

Mi&semester Examination in Property A, Law 307, November 20, 1959 Page 3

******************

************

******

Page 3

FINAL EXAMINATION IN PROPERTY A (Law 307)
First Semester 1959-1960 Professor Cribbet

TIME: h HOURS

The midsemester quiz counted twenty points; this final examination
will be graded on a scale of eighty points. The relative grading
weight is indicated in each instance. All questions should be
answered in the examination booklet, beginning on the inside of
the first page. Please write legibly and succinctly.

I. (20 points)

In 19*+0> Amos Brown died testate in Urbana, Illinois. He owned Blackacre,
a Champaign County farm, in fee simple absolute and his will devised Blackacre
to his son James Brown "to have and to hold for so long as the land shall be
used for farm purposes." Amos was survived by a wife, Anne, and by two sons,
James and Harry. The will was properly admitted to probate and in due course
the estate was closed and the executor discharged.

James Brown married Lucille in 19^-5 and two daughters were born in 19^7
and 19^8 respectively. In 1955, James died testate, devising Blackacre to "my
wife Lucille as long as she remains my widow. In the event of her remarriage
then said remainder of my property is to be equally divided between my daughters
Judy and Kay." In 1958; Lucille died testate, without having remarried, and
her will devised Blackacre to the First Methodist Church of Urbana, Illinois.
No provision was made for the children.

Blackacre, although still a farm, is now prime land for a new shopping
center and your client would like to purchase it, providing he can secure a
merchantable title in fee simple absolute. All of the parties mentioned are
alive and well except those whose death has been specifically mentioned. Analyze
the property interests which are or may be held by each individual. Discuss fully.

II. (30 points)

Many of the problems in real property arise when the lawyer attempts to
decide on the state of the title to Blackacre by examining an abstract of title.
Assume that each of the following hypotheticals represents a situation appearing
in a separate abstract. Indicate the state of the title in each case and briefly
give the reason for your answer. The land is located in Illinois in each instance.

Abstract # 1. In 195^ > Henry Hart conveyed by warranty deed to "George and
Mary Brown, as husband and wife . " Nothing is shown as to the marital status of
Henry Hart.

Abstract § 2. In 1925, Marjorie Jones, widow, conveyed to "Mary Smith and
her heirs . "

Abstract # 3- In 1919, Harry Horn and Mary his wife, having received title
to Blackacre "in joint tenancy and not in tenancy in common, " conveyed to
"Samuel Horn for life, remainder to those children of Samuel who survive him."
In 1921, Samuel Horn died unmarried and childless. Mary Horn had preceded him
in death.

Final Examination in Law 307, First Semester 1959-60 Page 2.

Abstract # k. In 1930, Herman Holmes and Anne his wife conveyed to "Ray
Holmes for life, remainder to Joseph Holmes for life, remainder to the heirs of
Joseph . "

Abstract # 5- In 1958, John Rutgers, a bachelor, died seised of Blackacre .
He devised the land to "my illegitimate son Harold Rone and the heirs of his
body." Harold was married to Marjorie, who was pregnant with their first child.
John Rutgers was survived by Ruth, his mother, and Sara, the daughter of a
deceased sister of John.

Abstract # 6. In 19^5, Terry Randall and Eugenia his wife leased to "Amos
Jones for so long as said lessee shall desire to use the premises as a drug store,
the same to be rent free." In 1959, the Randalls brought ejectment against Jones
after giving him sixty days1 notice to quit. /The_suit is still pending and
Jones is still operating a drug store on the land^'

Abstract # 7. In 1935, Abner Holt, a widower, conveyed to "John Brown and
Mary his wife, not in tenancy in common but in joint tenancy, with right of sur-
vivorship." In 1939, John Brown conveyed "such interest as I have in Blackacre
to my son Jack Brown and his heirs forever. ' In 19^-2, Mary Brown died intestate
survived by John and Jack. In 19^5, Jack died testate, devising "all of Black-
acre to my beloved secretary Rita Ritz . " The estate of Jack Brown was heavily
encumbered by debts and his wife, Lola, renounced the will and elected to take
dower .

Abstract # 8. In 1959, Russell Noles, a bachelor, conveyed to "Margaret
Pease for life, remainder to my heirs."

Abstract # 9» In 1938, Lester Moe and Hazel his wife conveyed to "Joe
Massey for the use of Herman Yoder and his heirs, but if Herman die without sur-
viving children then to Isaac Yates and his heirs . "

Abstract # 10. In 1957, Caesar Roma and Mabel his wife conveyed to "Eugene
Karrel for life, remainder to his heirs." In 1959, Eugene Karrel, a bachelor,
conveyed to "Arthur Siebert in fee simple absolute."

III. (15 points)

Rex Wright was an impecunious but resourceful individual who lived "high on
the hog" in Danville, Illinois, by the simple expedient of putting up a good
front and mingling with the socially correct crowd. Since he desired a new
hi-fi recording set, he went to the Radio Shoppe, Inc., managed and in fact
largely owned by an acquaintance, Roger Frain, and represented that he was a man
of solid financial means . He told Frain that he carried an average bank balance
of $5,000 and Frain did not bother to check with the bank. In fact, Rex kept a
$50 account so that he could have printed personal checks. Rex purchased a
$959.99 hi-fi set and paid $59-99 in cash. He signed an agreement of sale which
obligated him to pay $100 a month for nine months plus carrying charges, title
to remain in the Radio Shoppe, Inc. until the last payment was made. Three weeks
later at a large party at Rex's house, Simon Dregnon so admired the set that he
offered Rex $600 in cash for it. Roger Frain was present and, downing a long
slug of Scotch, said: "Are you crazy? Rex paid nearly $1000 for it just a few
weeks ago." Nonetheless, to please an old friend, Rex accepted the offer,

Final Examination in Law 307, First Semester 1959-60 Page 3-

taking $300 in cash plus a promise to pay $300 in a few days, and Sin-on said
he would pick up the set the following day, which he did. Roger said nothing
more and walked away after Rex pocketed the $300.

A week later Rex Wright died intestate, leaving only debts to be distributed
according to the statute of descent. Simon had not yet paid the remaining $300
when Radio Shoppe, Inc., served him with notice to surrender the hi-fi set to
them at once or be faced with a replevin action.

Simon Dregnon comes to you for advice. Explain the legal facts of life to
him, giving a full analysis of the various possibilities.

IV. (15 points)

The Ajax Realty Company held title in fee simple absolute to numerous
apartment buildings in Chicago. In 19^5, Ajax leased the entire first floor
of one building to Modern Retail Industries for office and display space. It
was a twenty-year written lease with option to renew for an additional period of
twenty years, at $12,000 annual rental plus a further sum to be determined on
the basis of a percentage of gross profits. The lease contained a specific
prohibition against assignment without the written consent of the Ajax Realty
Company. In 1950, Modern Retail Industries transferred all their interest in
the lease to New Plastics, Inc., with the written consent of Ajax. In 1955, Hew
Plastics, Inc., transferred an estate for eight years in the premises to Hart
and Co., Inc., in spite of the objection of Ajax. Ajax did accept rent directly
from Hart but continued to protest the validity of the transfer from New Plastics .

One of the terms of the base lease was a covenant by Ajax to keep the main
entrance hall in good repair. This Ajax failed to do, and in January 1957, a
business guest of Hart and Co., Inc., fell over a broken hall tile and was so
severely injured that he incurred $15,000 in medical bills. Hart demanded that
Ajax pay this amount but the company refused on the grounds that Hart was no
more than a trespasser, had no rights in the lease, and was not protected by
the covenant to repair. Hart then vacated the premises in July 1957, refused
to pay any further rent, and the entire floor has been vacant since. In July
1958, the entire building was condemned for a new freeway to furnish access to
the northern suburbs of Chicago. The business guest has not yet been compensated
for his loss by anyone.

Discuss the rights of the various parties arising frcm this combination of
events .

NAME NO.

MIDSEMESTER EXAMINATION IN PROPERTY B (Law 308)
March 31> 1959 Professor Looper

I. (30 minutes)

0 is the owner of the land at the time the first conveyance listed below is
made. The land is located in a jurisdiction which has a grantor- grantee index and
does not have a tax lien statute which requires the searching of the grantor index
for periods after a grantor conveys his interest in order to determine whether
there are tax liens on the property. 0 and all other persons are competent to convey
and receive, as the case may be, title to real property. All conveyances are by
general warranty deeds. Deeds are not recorded except as stated. Each grantee is
a purchaser for a valuable consideration without notice (assume also that there is
no basis for inquiry notice) of the prior deed unless the stated facts establish
otherwise.

Assume that the statute in the controlling jurisdiction is ambiguous as to
whether it is a notice statute or a race-notice statute. In the space provided
write "notice," "race-notice," or "it makes no difference," depending upon the
position you should take as to the type of statute in view of the person you repre-
sent. All conveyances or mortgages relate to the same land. The various events
occur in the order they are listed.

1. 0 conveys to A; A conveys to B; B records;
0 conveys to C; A records; C records. You
represent C.

2. 0 conveys to A; 0 conveys to B who has notice
of A' s unrecorded deed; A conveys to C who has
notice of B' s unrecorded deed; B records; A
records; C records. You represent C.

3. A conveys to B; B records; 0 conveys to A; A
conveys to C. You represent C.

k. 0 conveys to A; A conveys to B; 0 conveys to
C; B records; C records. You represent C.

5. 0 conveys to A; A conveys to B; B conveys to
C; 0 conveys to D. You represent C.

6. Same as No. 5 with this fact added at the end:
D records. You represent C.

7. 0 executes a mortgage in favor of A to secure a
loan of $5000; 0 executes a mortgage in favor of

B to secure a loan of $3000; 0 executes a mortgage
in favor of C who knows of A's unrecorded mortgage
to secure a loan of $3000; C records; B records; A
records. You represent B.

(a) The value of the land is $^000.

(b) The value of the land is $6000.

Midsemester Examination in Property B (Law 308), March 31, 1959 Page 2

II. (20 minutes)

In 1950 in consideration of $10,000, R executed a warranty deed "by which he
purported to convey the fee simple absolute in Blackacre to E. In 195^ E quit-
claimed Blackacre to his friend F for a consideration of five dollars.

In 1958 E and F discovered that Blackacre was subject to a mortgage which
secured the payment of $12,0C0 to T in 1965. Recently F has instituted an action
against R to recover $12,000 as damages for breach of the covenants for title con-
tained in the 1950 deed. What judgment?

Page 2

Midsemester Examination in Property B (Law 308), March 31, 1959 Page 3

III. (20 minutes)

You are a junior in the law office of Pavis & Looper and a senior partner calls
you into his office and states as follows: "Mr. Russell 0' Sullivan came in today
and handed me this piece of paper. You will observe that the paper simply provides
that he promises to pay $50,000 two weeks from today for the land and buildings
located at 307 West Vermont Street, Urbana, Illinois. The other party to the
document agrees to convey the land and buildings on receipt of the $50,000. Both
parties signed the paper in duplicate and the other copy is in the hands of the
other party. Mr. 0' Sullivan said someone told him he ought to see his lawyer. By
the way, he wants to carry out his promise. I want you to give me a brief memoran-
dum pointing out what I should advise Mr. 01 Sullivan to do."

Page 3

NAME No.

FINAL EXAMINATION IN PROPERTY B (Law 308)
Second Semester 1958-1959 Professor Looper

Instructions: You have four (h) hours in which to complete this examination.

The examination is composed of two parts, each part to take about

two hours.
Part I is to be answered in the examination booklet.
Part II is to be answered on the mimeographed sheets.

PART I (Two Hours)

1. (^5 minutes) In Commissioners of Romochitto River v. Withers, Mr. Justice

Handy said:

"What must be understood by the term private property? It appears to
us that it applies to such property as belongs absolutely to an individual,
and of which he has the exclusive right of disposition; property of a
specific, fixed, and tangible nature, capable of being had in possession
and transmitted to another, as houses, lands, and chattels."

Comment on this quotation, stating wherein you agree or disagree with it, and
for what reasons, drawing on examples from the casebook and classroom discussion
(not excluding the materials covered in the first semester). You will be graded
primarily on the pertinency of your illustrations.

2. (U5 minutes) In the post-war building boom in a certain city, 0 bought a tract

of vacant, unimproved land in a general area which was being
rapidly developed primarily for residence purposes. 0' s tract
consisted of a single block, for which he prepared and filed a plat, in due form
and with proper authorization, which subdivided this block into 50 lots which were
duly designated on the plat. Then 0 began to sell these lots. This subdivision
was designated by 0 as the "Pleasant View Addition." 0 erected a large billboard
on this land which carried the heading "Pleasant View Addition," and also the
statement that it was to be a restricted area. The same references were made in a
number of newspaper ads which 0 ran to promote his sale of the lots. These ads
appeared at intervals for a period of about a year, during which period 0 sold all
of the lots except Lots 7, lo, 23, 3*+, and U6, which still remain unsold. 0 re-
moved the billboard at about the same time that he stopped running the ads. Each
of the deeds to the lots sold contained this language:

"Subject however to the following conditions, namely, that no building
except single-family residences shall be built on the above-described
premises, no residence shall be built at a cost of less than $10,000, and
no building shall be built on said premises nearer than 30 feet from the
street."

A bought Lot 6. Some time later B bought Lot ko, which was located on the opposite
side of the block from Lot 6. Both of these deeds, of course, contained the above
restrictions. A built a house on his lot and now resides there. B, however, did
not build, but about a year later sold his lot to C, the deed to C containing no
reference to the restrictions. C began to build a grocery store on Lot UO. A ob-
jected, and brought a suit to restrain C from doing so. As defenses, C alleged as
follows:

(a) He was not bound by the restrictive provisions in the deed to B.

(b) Whether or not he was bound by such restrictions, A had no standing
to enforce them.

(c) Whether or not A could have enforced the restrictions against C at
one time, he could no longer do so, because the restrictions had

Final Examination in Law 308, Second Semester 1958-1959 Page 2

ceased to be binding. On this count, C alleged that the opposite
sides of all four streets which bounded the block in question had,
in the 5 years since the subdivision was laid out, been built up
largely with small business buildings of one kind or another.

Discuss the validity of these defenses.

3. (30 minutes) You are attorney in a firm with a large real estate practice.
Your largest single client is the Savings & Loan Association
for which you do title searches of land on the security of which
the Association is contemplating making loans. In a local law review appears an
article entitled "Title Insurance: Our Conveyancers' Dereliction of Professional
Duty." The concluding paragraph of this article is as follows:

"Although both of the basic systems of title protection in modern land
transactions in the United States are available in this state, namely,
registration and recordation, our history and our practice show that we
have put our faith (and the bulk of our land) under the latter. However,
it is to be regretted that the members of our conveyancing bar have been
sloth- like in their acceptance and utilization of policies of title
insurance, the only available means of making the recording system
really effective. Particularly is this true where the conveyancer is
hired by a lending institution and the prospective purchaser of the
land is not represented by counsel. Policies of title insurance afford
security to the purchaser of his investment which is of course the only
security he can get under a recordation system, since it is only under
a registration system that he can get security of his title. Title
insurance should be recommended by conveyancers for all transactions,
and it is submitted that insofar as they do not do so our conveyancers
are failing to fulfill their professional obligations to their clients
since their prime consideration should be affording their clients with
as much security as possible so that they (the clients) will not un-
expectedly lose their land (and their investment) because of latent
and unsuspected defects in their titles."

The President of the Savings & Loan Association, your principal client, tells you
that several of the Association' s borrowers have seen this article and have in-
quired whether it is sound and why title insurance is not recommended to them.
Seme of these inquiries have been couched in terms of complaint. He asks you to
give him a memorandum which he can use as a basis for talking with borrowers.

.

FINAL EXAMINATION IN PROPERTY B (Law 308)
Second Semester 1958-1959 Professor Looper

PART II (Two Hours)

The following four questions are weighted equally. Therefore you
should spend about 30 minutes on each question, writing your
answer in the space provided.

U. D entered into a contract to sell a lot of land to P. D, as required by the
contract, furnished P with an abstract of title which showed a clear chain of title
from the government to the original patentee, and mesne conveyances from him down
to A. Then the abstract showed the following entries:

a deed from B to E dated in 19^7, recorded the same year,
a deed from A to C dated in 19^8, recorded in 19^9,
a deed from A to B dated in 19^6, recorded in 1950, and
a deed from C to D dated in 1951> recorded the same year.

P refused to accept a deed from D, on the ground that D did not have a mar-
ketable title, but agreed to complete the transaction if D could clear his title
within 30 days. What would you advise D to do, if anything? Assume you are in a
race-notice jurisdiction which has a tract index.

Final Examination in Law 308, Second Semester 1958-1959 Page ^

5. D and A owned adjoining lots in Urbana, Illinois. In 1930 they built garages
and graded and paved a driveway 8 feet wide astride the common boundary line. Each
paid one -ha If the cost of grading and paving the driveway. In 19^5 A sold to P.
Now D is laying out a new driveway around the other side of his house and is about
to build a fence on his property along the line down the middle of the old drive.
P1 s house is only h l/2 feet from the prospective fence and he cannot reach his
garage around the other side of his house without going to considerable expense
to cut down large trees which greatly enhance the attractiveness and value of his
property. P brings a bill to enjoin interference with his use of the entire 8-foot
drive. What result?

Page k

Final Examination in Law 308, Second Semester 1958-1959 Page 5

6. G was the owner of a house and lot which was in the possession of T, a tenant
under a 5-year lease. G was getting along in years. He duly executed and acknowl-
edged a deed to this property to his nephew, E, and handed the deed to his friend,
S, saying to S, "Please keep this deed for me and deliver it to E when I am gone,
if he survives me." Shortly thereafter E learned of what had happened, and in con-
sideration of a substantial sum of money paid to S, induced S to deliver the deed
to him. E immediately had the deed recorded. Several months later E entered into
negotiations with F for the sale of the property. The sale was consummated, E gave
a deed to F, and F paid a valuable consideration therefor and without any knowledge
of what had previously happened. At this time G knew nothing of what had transpired,
nor of the fact that his deed to E had been recorded. G learned of the facts when
F demanded payment to him of T* s rent. G immediately brought suit to quiet title,
joining E and F as defendants. Insofar as his rights against F are concerned, dis-
cuss the grounds which G might assert in support of his suit.

Page 5

Final Examination in Lav 308, Second Semester 1958-1959 Page 6

7. Write in each blank space the name of the owner of Blackacre after each trans-
action involved. Where an equitable ownership is enforceable against the holder
of the legal title, the equitable owner is "the owner." If the issue is in doubt
write the word "doubtful." The issue is in doubt if the cases are in conflict. If
you should answer any question "doubtful", explain why it is such in the space pro-
vided after the end of Part (k).

Unless it is otherwise stated in the question, you are to assume the follow-
ing facts: 0 owns Blackacre (both actually and of record) immediately preceding the
first transaction. Blackacre is vacant land and is located in a jurisdiction that
has a grantor- grantee index and does not have a tax-lien statute requiring searching
the grantor index for periods after a grantor conveys his interest. 0 and all other
persons are competent to convey or receive, as the case may be, title to real
property. All deeds contain full covenants of warranty. None of the persons in-
volved in any of the questions has actual knowledge of any facts not disclosed by
the record chain of title except as knowledge is indicated.

Notice Race-Notice
Statute Statute

(1) 0 to A, not recorded

A to B, recorded

B to C, recorded

0 to D, recorded

(2) 0 to A, not recorded

0 to B, not recorded

A records

B to C, recorded

(3) 0 to A, not recorded
0 to B, not recorded
B to C, not recorded
A records
A to X, recorded
B records

{k) 0 to A, not recorded
0 to B, not recorded

(B knows of the deed to A)
B to C, recorded

(C is shown the deed from 0 to B)
A records
A to D, recorded

Explain "doubtful" answers here:-

Page 6

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FINAL EXAMINATION IN PROPERTY B (Law 308)
Second Semester 1959-1960 Professor Cribbet

Time : h Hours

All questions should be answered in the examination booklet, beginning
on the inside of the first page. The relative grading weight is indicated
in each instance. Please write legibly and succinctly.

I. (20 points) A widow, Mrs. Ogden Reid Storke, orally agreed to sell Blackacre
to a neighbor, Mr. Jesse Jansen. Mr. Jansen paid Mrs. Storke $5,000 in

cash at the time of the agreement and a warranty deed in proper form was

given to a local notary public, Mr. Harold Black, to be delivered to Mr. Jansen

upon the payment of a further sum of $5,000 and the delivery of a purchase

money mortgage on Blackacre for $20,000. The deed was not to be recorded until

all conditions were met and Blackacre was to remain in the possession of Mrs. Storke

until that time. The parties orally agreed that time was of the essence and that

the contract must be performed by April 1, 1959-

Jansen did not meet the conditions on April 1, claiming that the title
was unmarketable because of outstanding liens. Mrs. Storke managed to have
the liens released but died testate April 30, 1959* Her will left all of the
real property to her only daughter, Judy Storke, and all of the personal property
to her only son, Richard Storke, a minor. The daughter was appointed executrix
of the estate and promptly tendered the $5,000 plus interest to Jansen and demanded
return of the deed from Black. The latter ignored the request and on May 25,
1959) delivered the deed to Jansen upon the payment to Black of $5,000 for the
Storke estate plus a properly executed mortgage. The daughter refused to accept
either item from Black. Jansen promptly recorded the deed and took possession
of Blackacre, without force.

The daughter, Judy Storke, is twenty-two years old and has good business
sense. She recognizes the potential value of Blackacre due to a projected new
highway in the area and, in fact, has a prospective purchaser who will pay $50,000
for the land if she can produce a clear title to it. At this stage Judy
Storke seeks your legal services. How would you advise her? Explain.
Be specific as to what legal or equitable relief you would seek, if any.

II. (20 points) 0, an Illinois realtor, conveyed Blackacre to A, purportedly
in fee simple absolute, by a statutory short form warranty deed in 1938-
(Price - $15,000) At that time 0 had only a life estate in the land conveyed
and the remainder was claimed by X under a will that was properly probated in the
county court where the land was located. A had not in fact checked the records
but relied solely on O's warranty deed. In 19l+5> A conveyed by statutory short
form quitclaim deed to B,vho paid $20,000 but did not check the records. The
two deeds were both recorded as soon as delivered. In 1950, B conveyed by
statutory short form warranty deed to C, who was warned by X, before he pur chafed
the land, that the title was bad. (Price - $30,000) C inquired of B and was
assured of the validity of the title, B saying, "What are you complaining about;
I'm giving you a warranty deed, aren't I?"

Final Examination in Property B (Law 308), Second Semester 1959-1960 Page 2

C occupied the land until 1959, when 0 died, at which point X brings
ejectment against C and seeks to recover possession of the land. C now comes to
you for advice . Explain the rights of the various parties . If you advise suit
on any of the covenants in the deeds, explain specifically which ones are
involved and why. What effect would it have on your answer if 0 acquired X's
interest in Blackacre in 1958? Who would then own Blackacre? Explain.

III. (20 points) In 1920, 0 owned a tract of undeveloped land bounded on the
north by Allen Avenue, on the west by Baker Street, and on the south and east
by the land of strangers to this proceeding. In 1923, 0 built a house on the
eastern portion of his tract and, after securing permission of the city, laid
sewer pipes from the house westward to Baker Street where they connected with the
main city sewer. The pipes were buried six feet in the ground and were not
visible, except to moles working in the community. In 1931, 0 subdivided his
tract into four lots of equal size with boundary lines running from north to
south and built a house on each lot, connecting each one with the buried sewer.
These lots were numbered 1, 2, 3, and h, reading from west to east. 0 sold

lot h in 1931, lot 3 in 1932, lot 1 in 193^, and finally sold lot 2 in 1937-
All conveyances were by warranty deed with the usual covenants and nothing was
mentioned as to easements of any kind (in fact none of the purchasers even
thought about sewage disposal at the time). The deeds to lots 3 and k contained
covenants that "said lot will never be used for other than a single family
residence." The deed to lot 1 contained no restrictive covenants of any
kind but the deed to lot 2 stated "said lot will never be used for other than
residential purposes .

By 1958 each lot had been conveyed several times and the then owners were
as follows: lot 1 - A; lot 2 - Bj lot 3 - C; lot h - D. All four lots contained
the original houses built by 0 in 1931- In 1958, A decided to tear down his
house and build a service station. The areas to the south and east of the four
lots were all residential but the land to the north, across Allen Avenue,
and to the west, across Baker Street, was mixed business and "seedy' residential.
A removed the house on lot 1 and started to dig a basement, but the workmen
struck the sewage pipes and filled the hole with a bit of a mess. B, C, and
D secured a temporary injunction, restraining A from building anything on lot 1,
other than another residence, and ordering him to restore the sewage pipes to
their original condition. At the final hearing the trial court gave a permanent
injunction against other than a single family residence and ordered A to allow
C and D to continue to use the sewage drain across his land, but held that B
could not use the drain without A's permission. A and B filed appeals.

How should the case be decided on appeal? Explain fully. How would
the case be affected by the introduction of evidence that a new city sewer
was planned for Allen Avenue and would be ready by 1959? Explain.

IV. (10 points) State X is in the eastern half of the United States and has
had very little litigation involving water rights. The existing authority
indicates that the riparian doctrine will be followed for streams and other natural

Final Examination in Property B (Law 308), Second Semester 1959-1960 Page 3

water courses and that the English doctrine of Actor, v. Blundell will prevail
where ground water is involved. Clear Creek is a substantial stream in State X
and its source is Clear Spring, which for more than fifty years has produced
a dependable flow of water for riparians along the stream. For most of the fifty-
year period riparians have used water from the Creek, until 1957 when numerous
water wells were drilled in the vicinity of Clear Spring for irrigation purposes.
These wells were all located on the lands of the drillers but the project
caused the stream to run dry. About 25$> of the ground water was used on the
land where the wells were located, the remaining 75% was piped to other land in
the immediate vicinity. The riparian owners seek injunctive relief against
the well drillers. How would you decide the case? Discuss the relevant factors.

V. (30 points) Section 26.5^7 of the Michigan Statutes Annotated reads as
follows: "Every conveyance of real estate within the state hereafter made, which
shall not be recorded as provided in this chapter, shall be void as against any
subsequent purchaser in good faith and for a valuable consideration, of the
same real estate or any portion thereof, whose conveyance shall be first duly
recorded. . .

Consider each of the following cases arising in Michigan:

(1) 0, being seized of an indefeasible fee in Blackacre, conveyed by
warranty deed to A for full value. A did not record nor did he enter into
possession. 0 then conveyed by warranty deed to B for full value. B had been
told by X, a stranger to the title, that he saw 0 hand A a deed to the land.

B ignored this comment, promptly recorded his deed, and entered into possession.
Who has the better claim to Blackacre? Why?

(2) 0 conveyed by warranty deed to A but the deed was not acknowledged,
as required by statute in Michigan. The deed was recorded in this defective
condition. 0 then quitclaimed the land to B, who did not check the records

and had no actual knowledge of A's deed. B promptly recorded his deed. Who
has priority? Why?

(3) 0 conveyed by warranty deed to A, who failed to record but who

did lease the land to X, who entered into immediate possession. 0 then conveyed
to B, a New York resident, by warranty deed. B had no knowledge of the prior
deed to A and never came to Michigan during the transaction. B's attorney
promptly recorded the deed. Who now owns Blackacre? Why?

(U) 0 conveyed to A by warranty deed and the deed was not recorded
at once. 0 then conveyed to B by warranty deed. B was a bfp. A then recorded
his deed and a few days later B recorded his. Who has priority? Why?

(5) 0 executed a contract of sale to A, who promptly recorded the
contract. 0 then conveyed the land to B, who had no actual notice and in
fact did not look at the records. B recorded his warranty deed at once. Who
has priority? Why?

(6-10) The general Statutes of North Carolina, Volume 2A, Section ^7-18,
read: "No conveyance of land, or contract to convey, or lease of land for more
than three years shall be valid to pass any property, as against creditors
or purchasers for a valuable consideration from the donor, bargainor or lessor,
but from the registration thereof within the county where the land lies. . . ."
Answer each of the preceding five questions in the light of the North Carolina
statute, explaining why your answer is different or the same, as the case may be.

FINAL EXAMINATION IN RESTITUTION (Law 330)

First semester 1958-1959 Professor Looper

Total Time: 3 l/2 hours

This examination consists of five questions. In answering these questions, assume
that you are in a common-law jurisdiction in which the following statutes are on
the books .

STATUTES

Chapter 83- Limitation of Actions.

Sec . 1 . Real actions . No person shall commence an action for the recovery
of lands, nor make an entry thereon, unless within seven years after che right
to bring such action or make such entry first accrued.

Sec. 2. Personal actions. The following actions can only be comirenced
within the periods hereinafter prescribed:

• ..(b) Actions on unwritten contracts, expressed or implied, or on
awards of arbitration, or to recover damages for an injury done to property,
real or personal, or to recover the possession of personal property or damages
for the detention or conversion thereof, and all civil actions not otherwise
provided for, shall be commenced within three years next after the cause of action
accrued.

(c) Actions on bonds, promissory notes, bills of exchange, written
leases, written contracts, or other evidences of indebtedness in writing, shall be
commenced within five years next after the cause of action accrued.

Sec. 3- Counterclaims. A defendant may plead a set-off or counterclaim
barred by the statute of limitation, while held and owned by him, to any action,
the cause of which was owned by the plaintiff or person under whom he claims,
before such set-off or counterclaim was so barred, and not otherwise.

Sec. h. Absence from state deducted. If, when the cause of action accrues
against a person, he is out of the state, the action may be commenced vi thin Ihe
times herein limited, after his coming into or return to the state; and if, after
the cause of action accrues, he departs from and resides out of the state; the
time of his absence is no part of the time limited for the commencement of the
action.

Sec . 5 • Fraudulent concealment . If a person liable to an action fraudulent! ,
corceals the cause of such action from the knowledge of the person entitled
thereto, the action may be commenced at any time within five years aft^r the
person entitled to bring the same discovers that he has such cause of accio-i, and
not afterwards .

Chapter 110. Civil Practice.

Sec. 38. Counterclaims. (a) The defendant may set forth, in his answer, as
many grounds of defense, counterclaim, set-off, and for relief, as he may have,
whether they be such as have been heretofore denominated legal, or equitable, or
both .

Final Examination in Restitution (Law 330) Page 2

(b) A counterclaim to a legal or equitable action arising out
of contract must itself be a cause of action arising out of contract.

(c) A counterclaim to a legal or equitable action not arising
out of contract must arise out of the same transaction as the original claim.

Sec. 72. Relief from judgments and decrees. (a) Relief from final orders,
judgments and decrees may be had upon petition filed in the same proceeding. All
relief heretofore obtainable, either at law or in equity, shall be available in
such proceeding.

(b) The petition must be filed not later than two years after the
entry of the order, judgment or decree. Time during which the person seeking
relief is under legal disability or duress or the ground for relief is fraudu-
lently concealed shall be excluded in computing the period of two years .

(c) Unless lack of jurisdiction affirmatively appears from the
record proper, the vacation or modification of an order, judgment or decree pur-
suant to the provisions of this section does not affect the right, title or
interest in or to any real or personal property of any person, not a party to the
original action, acquired for value after the entry of the order, judgment or
decree but before the filing of the petition, nor affect any right of any person
not a party to the original action under any certificate of sale issued before
the filing of the petition, pursuant to a sale based on the order, judgment or
decree .

(d) Nothing contained in this section affects any existing right
to relief from a void order, judgment or decree, or to employ any existing method
to procure that relief.

QUESTIONS

1. P took an assignment of a life insurance policy from X on the life of Y. X

had no insurable interest in Y's life, but P took the assignment after the insurance
company's officers had assured him that the policy was valid. P paid premiums on
the policy for several years. Y died, and the insurance ccmpany refused to pay P
the amount of the policy. Advise P as to his rights.

2. A is B's cousin. On B's death, A, mistakenly believing that he is B's heir
and next-of-kin, takes over B's farm- A pays the taxes, discharges a mortgage
indebtedness of $5000, tears down an old building and uses the wood for kindling,
builds a swimming pool worth £3000, and operates the farm for two years at a
profit of $8000 per year. B's heir, a nephew, now returns from a long trip abroad
and asks you what are his rights and liabilities.

3- B leased to P for three years a piece of land on which was a factory. The
lease gave P an option to purchase the premises during the term. There was no
provision in the lease for making repairs or for insurance. D insured the prop-
erty. The factory burned down, and D collected the insurance. On the assumption
that D would rebuild, P took up his option to purchase the propei ty and made the
required deposit of 10$ of the purchase price. D thereafter refused to rebuild.
P demanded the return of his deposit, which was refused. P then sued out a bill
of complaint in equity, asking the court to give relief in the .alternative, either

'

Final Examination in Restitution (Law 330) Page 3

(a) reformation of the written lease agreement, to clarify D's duty to rebuild,
or (b) rescission of the land sale contract and restitution of the deposit. D
counterclaimed for specific performance. How should the case be decided?

h. G, a gangster, disappeared in 19^8- Investigation disclosed that he left
town after several attempts had been made on his life. In 1955, A, the adminis-
trator of his estate, demanded payment of his life insurance, which was payable to
his estate. The company refused payment unless affirmative proof of G's death
could be produced. A brought suit on the policy and recovered judgment for $10,000,
its face value. The judgment was paid, and A distributed the proceeds as follows:
to the creditors of G he distributed $1+000, and the balance of $6000 he distributed
equally to G's next-of-kin, who happened to be X, Y and Z. X used his share of
the money to pay off his debts; Y bought an automobile which he ■would otherwise
have been unable to afford; and Z bought uranium stock which rapidly appreciated
in value. During all this time Y had been harboring G from his pursuers, and
was in fact the only person who knew of G's continued existence. Finally in
1959 G left hidin~ and returned to public life. The insurance co.jpany now comes
to you for advice as to the possibility of getting its money back.

5- D advertised for sale the "south 60 acres of my 80-acre farm." P did not see
the advertisement but heard from a neighbor, "D's farm is for sale." P was shown
the premises by D, who made no statement as -co the reservation of the north 20
acres, believing P knew of this from the terms of the advertisement. But P in
fact believed the whole 80-acre tract was encompassed in the offer. Accordingly
he paid the stipulated purchase price and accepted a quitclaim deed, which, however,
described by metes and bounds only the south 60 acres. P went into possession of
the entire 80-acre tract, and soon discovered a small uranium deposit under the
north 20 acres which he mined for several years. Ee did not discover an+il
six years after the conveyance the discrepancy between the terms of the deed and
his original understanding. He delayed taking action a further six months. P
then sued D for reformation of the deed to enlarge the terms of the conveyance to
include the north 20 acres. D demurred and also filed a counterclaim for f.oOCO,
alleging that P owed him $5000 for the conversion of the uranium and $3000 for the
rental value of the north 20-acre tract. How should the case be tecided?

MIDSEMESTER EXAMINATION IN RESTITUTION (LAW 330)
First Semester 1959-1960 Professor Looper

TOTAL TIME: 60 MINUTES
(The two questions count equally. )

1. P, an attorney at law, entered into an oral agreement with D to institute
a suit in D' s behalf for the recovery of damages for personal injuries allegedly
sustained by another's negligence. Under this agreement P was to receive one-third
of any recovery, whether by way of judgment or settlement. P spent several weeks
gathering evidence and doing other research, and in the process incurred various
expenses. He then instituted suit and opened negotiations for a settlement, both
of which were pending at the time he was disbarred from the practice of law for
reasons not connected in any wise with the prosecution of D' s suit. After P' s
disbarment, other attorneys were substituted for him and D' s suit was subsequently
settled for $6,000. D refused to pay P anything. What are P* s rights against D?

/See 79 A. 2d 310; 85 F. 2d 507

2. On October 1, 1959, Alexander and Bush each deposited $500 with Stake,
who delivered to each of them a written document which read as follows:

"I hereby certify that I have received the following
amounts:

Alexander $500

Bush $500

Canfield $1000

"In the event Black is elected governor of the State at the
ensuing election, then I am to pay Canfield $2,000; in case White is
elected governor, then I am to pay $1000 to Alexander and $1000 to Bush.

John Stake"

On October 30, Alexander demanded from Stake the return of his $500 deposit. On
November h, Black was elected governor by a landslide. On November 5> before Stake
had paid any of the deposited money to Canfield, Bush demanded the return of his
$500. Stake refused both demands, and on November 6 delivered the $2000 to
Canfield. Advise Alexander and Bush as to their rights, if any.

/Cf . Question #2*4-, Illinois State Bar Examination, September 1959/

FINAL EXAMINATION IN RESTITUTION (Law 330 )
First Semester 1959-1960 Professor Looper

TOTAL TIME: 3 HOURS

1. A contracts to convey lot No. 35 with the house thereon to B. By mistake the
adjoining vacant lot (No. 36) is conveyed. B moved into the house on lot 35-
Shortly thereafter B1 s creditor, X, levies execution on the lot as it appears in
the registry office, that is, lot 36, as belonging to B. At the sale the sheriff
points out lot 35 as the lot to be sold and B, who is ignorant of his lack of title,
says nothing. C is the highest bidder, paying $10,000, of which $8,000 goes to B's
creditors, $500 to the sheriff for expenses, and the balance to B. Does C have any
remedy?

2. An aged woman agreed in writing to give to her nephew "all of my property of
every description" in return for the nephew's promise to support her during life.
Her known property consisted of a small cottage worth perhaps $10,000 and life
insurance policies for $5,000. After her death intestate it appeared that a former
employee had embezzled $10,000 from her. This he donated to his niece. She,
ignorant of its source, invested it in land on which she found oil after boring
several unproductive holes. The decedent never knew of the embezzlement and as-
sumed, as did the nephew, that she had no property other than the cottage and the
insurance policies. What are the rights of the parties?

3. V was the owner of a small tract of land on which was located certain springs
or wells of mineral water known as the Crystal Rock Springs. On January 1, 1959>
V sold the premises, including the springs and buildings located thereon, to P for
the sum of $10,000, representing that the waters were natural mineral waters and
were bottled and sold as they flowed from the ground. He also stated to P that the
daily natural flow of water from the Crystal Rock Springs was 1200 gallons and
that this rate would continue in the future. The purchase price was to be paid in
ten yearly installments of $1000 each. After going into possession and paying the
first installment, P expended $U00O in erecting a small bottling plant for bottling
the water in the amount which V had represented would be the natural product of the
springs. After P had bottled a considerable amount of water, it was discovered
that the water was not a natural mineral water and that the flow did not exceed
k60 gallons. Thereafter P continued to bottle small quantities of the water, until
the plant burned down on August 1, 1959. On January 1, i960, when the second
installment payment became due, P refused to make payment and demanded of V the
return of his first $1000 payment. V refused and sued P for specific performance
of the contract. P now comes to you for advice.

k. Adams occupied an apartment on the third story of the Eagle Hotel, which was a
wooden building. He had an office in a brick bank building in the same town. As
he started on a short trip, Adams requested the landlord of the Eagle Hotel to take
out insurance on the furniture in his apartment. The landlord showed the furniture
to the insurance company' s local agent, who looked at the furniture in the hotel
room and agreed to put on a binder for $2500 pending a formal application and
issuance of a policy. As they went downstairs the landlord referred to Adams' of-
fice in the brick bank building. The agent got the impression that the furniture
was to be kept in that office, and in writing up the binder, he described the
property as being in a brick office building. The premium would be at the rate of
one per cent on property in a brick building and two per cent on property in a
wooden building. The next day the agent collected the $25 premium from the land-
lord. A week later the furniture in Adams' apartment was destroyed by fire. The
insurance company paid the face value of the policy. Upon discovering that the
property was located in the hotel, the insurance company demanded that Adams return
the payment. What are the rights of the parties?

Final Examination in Law 330, First Semester 1959-1960 Page 2

5. Under the terms of a will, Blackacre is left to T for life with remainder to
R. Believing that he is the owner in fee, T goes into possession and pays off a
$2000 mortgage which has matured. He then obtains a $^000 unsecured loan from the
Shark Bank on the representation that he owns Blackacre in fee without encum-
brances. With the proceeds of the loan, plus $4000 of his own money, T erects a
house on the land which enhances its market value by $7000. T then dies insolvent.
What are the rights of the parties?

FINAL EXAMINATION IK SALES (Law <)()
First Semester 195^-1959 P ofesdor Warren

ESSAY SECTION

TIME: Two hours and fort,/ minute::

IMPORTANT : Do hot write your name on either the question sheet or the examination
booklet .

DIRECTIONS : Write plainly and in ink. You are limited in space t: two and one-
half pages for each question. Nothing more will be graded. Please return the
question sheet with your booklet.

1. (a) Carmen Laboratories manufacture hair dye and sell their products through,
among other stores, Anabel et Cie., an exclusive cosmetics shop. X, a woman of 60,
entered the Anabel shop and asked for a package of "Carmen 10L, " but that number
was out of stock and she decided on "Carmen 105," described by the saj.es girl as
being a little darker shade but containing the same ingredients as 10V. X then
went to the house of Mrs- Kelly, a friend who always did X's hair although she was
not a licensed hairdresser, and had the dye applied. X and Mrs. Kelly opened the
package and read all of the following instructions which appeared in printed form
on the box:

"CAUTION. This product contains ingredients which may cause skin irri-
tation on certain individuals and a preliminary test according to the
accompanying directions should first be made .

"THE PRELIMINARY OR PATCH TEST. Medical science nas established the
fact that a susceptible person may be allergic to even the simplest
product. Of the millions of people using hair coloring, a limited few
may be allergic or hypersensitive to it. The common methoa used by
medical authorities in detecting those hypersensitive persons is by a
preliminary or patch test. Therefore, before contacting or using thi'
product, a test in strict accordance with the following directions
should be made before every application of this product." /instruction
regarding the procedure to be used in the patch test followed./

'•Irs. Kelly applied the dye to X's head with a toothbrush, and no patch test
was made by them at this time. That night X's head began to burn and within a few
days she was hospitalized with sores throughout the scalp area. Medical evidence
established a causal connection between the contact with the dye and her condition .
She was prevented by this illness from working for about a year. Within ohe propei
period and after giving reasonable notice to the defendant, X brought suit againrt
Carmen and Anabel for breach of warranty of quality. You may assume that testimon;.
on the trial besides establishing the facts set out above also showed thct X had
been using Carmen hair dye fcr several years and that she had last used Carmen 10L
and had had no trouble. X was unable to recall, when questioned, whether shs had

ever Laa a patch test for Carmen hair ayes, but asserted that since she had never
had trouble before, she saw no need for one. X testified that the dye h?d
practically eaten away the toothbrush used to apply it. Discuss ^he disposition
that American courts would be likely to make of X's suit.

'

Final Examination in Sales, Law 337, Essay Section, First Semestei 1958-59 Page 2.

(b) Suppose the facts are the same as in part (a) above except that instead
of merely having the dye applied to her head, X also applied some of the Carmen
hair dye to the head of her daughter, Lurlene, on the same night it was applied to
X's head, with the same disastrous result. Lurlene did not even see the box en-
closing the bottle of dye and had had no experience with the product at all. What
disposition should be made of Lurlene's suit against Carmen and Anabel for breach
of warranty of quality?

(c) Suppose the facts are the same as in part (a) above except that X pur-
chased the Carmen dye from the Owl Drug Store, a self-service merchandising
business, by simply selecting Iz from the counter and paying the cashier. What
disposition should be made of X's suit for breach of implied warranty against
Carmen and the Owl Drug Store ?

2. In January 1959; S, a licensed used car dealer, sold a 1957 Buick to B for a
time price of $1500, with $300 paid on delivery and the remaining $1200 tc be paid
in $100 installments over twelve months. The contract of sale was labeled "retail
installment sale contract." Before the first installment became dve, X notified E
that he owned two of the tires on the auto, having previously sold chem on condi-
tional sale for $30 each to S, who had failed to pay for them. When S refused B's
demand to settle with X for the tires, B surrendered the tires to X. Furt.ifcr.20re
B found that the block of the Buick was cracked at the time of the sale.

(a) Suppose B sues to rescind the contract and take back his down nayment due
to difficulty over the tires. The parties stipulated that it would cost $35 to
replace the two tires. What judgment should a court render? Expl;in.

(b) Suppose B sues S for breach of implied quality due to the condition of
the block. Suppose S proved that the condition of the block was not observable
unless the engine was torn down and that it was not the custom of automobile dealers
to inspect used cars this thoroughly. What result? Why?

(c) Suppose the sale contract said, "No warranties, expressed or implied,
representations, promises or statements have been made by the seller unless en-
dorsed hereon in writing." In fact, the written contract referred to above con-
tained no warranties. What effect would this clause have on your answers "in (a)
and (b) above?

(d) Suppose the sale contract indicated that $200 of the $1200 balance was
a finance charge. Is this a violation of the Illinois usury statute? Is this a
violation of the Illinois Retail Installment Sales Act? Assuming it is a violation
of the usury statute, what would the penalty be?

3. Answer the following question on the basis of the Uniform Trv.st Receipts Act:

(a) X Company is the American distributor of the Cheeta brand of foreign
sports cars; Y is the local wholesale distributor of this auto. Assume that X and
Y have filed a statement of trust receipts financing and that Y has given X a trust
receipt on a certain auto as security for X's loaning Y the money to purcix.se the
vehicle from X. Assume further that X has forbidden Y to sell without X's consent
but has allowed Y to keep the auto on the showroom floor. Is X's security interest
under the trust receipt valid as against the following parties :

Final Examination in Sales. Lav 337> Essay Section, First Semester 1958-59 Fage 3-

(i) -\ creditor of Y who attached the automobile on which Y had given the
trust receipt? Explain.

(ii) A retail dealer who purchased the automobile on which Y had given the
trust receipt for value and who had no knowledge of the limitations on Y's
power to sell? Explain.

(b) M, manufacturer, delivered an automobile to D, dealer, on July 1. The
transaction was financed by F, finance company, which took a trust receipt on the
automobile, executed on July 1.

(i) Suppose C, a creditor of D without notice of F's interest under thz trus^
receipt, attaches the auto in D's possession on July 25. F did not file a
statement of trust receipts financing until August 5- Is F's security good
against C? Explain.

( ii ) Suppose Z 3ank advanced money to D en July 5 and D pledged the auto to
them, giving up possession on the same day. On August 2, F filed a certifi-
cate of trust receipts financing. Is F's security interest good as against
Z? Explain. Would your answer to this question be different if F had filed
the certificate on July 10? Explain.

h. Turner is proprietor of a jewelry store where he sells new jewelry and watches
and both sells and repairs used jewelry and watches .

(a) Suppose 0 brings a watch to Turner to have it repaired. Turner wrong-
fully sells the watch to X, a BFP- As between 0 and X, who is entitled to the watch
under the USA? Under the UCC? Explain briefly the theory behind these ru^es.

(b) Suppose B purchases a watch from Turner but leaves it with the dealer to
have his name inscribed on it. Turner then wrongfully sells it to X, a. BFP. As
between B and X, who is entitled to the watch under the USA? Under the UCC? Ex-
plain briefly the theory behind these rules.

(c) Suppose S, a wholesaler, entered into the following agreement with Turner
concerning some jewelry: "The goods sent to you /Turner/ are sent to you for your
examination only to be held by you at your risk of loss, it being distinctly under-
stood that the title shall remain in S Company. Should you desire to purchase any
of these goods, no sale shall be consummated until S Company has approved."

(i) Turner goes bankrupt. Is S entitled to the goods covered by this agree-
ment and as yet unsold, under the USA? Under the UCC?

(ii) Turner's creditors attach the goods. Should they prevail over S under
the USA? Under tne UCC?

FINAL EXAMINATION IN SALES (Law 337)
First Semester 1959-1960 Professor Whiteside

TIME: 3 1/2 HOURS

Note : Omit one of Questions U, 5, and 6.

1. Central Hardware Company advertised a ladder sale in a newspaper, with the
following in large type:

"Sensational Factory Purchase of
'SAFETY FIRST'
LADDERS
In designing our ladders the prime consideration
was SAFETY — and that's exactly what you'll find
in these splendid ladders'."

The stock of ladders was acquired by Central Hardware directly from Safety First
Ladder Manufacturing Company. Three types of ladders were described as the "2-in-
1", designed for use both as a step ladder and as an extension ladder, with the
further language, "mighty strong and durable'."

Turner, a painting contractor, took the advertisement to Central Hardware,
pointed out the "2-in-l" in the ad, asked whether it would be good for cleaning
wallpaper. The salesman said, "I think that would be exactly what you want," that
"they were tested to 300 pounds or better." Turner said, "I don't know anything
about wood; I will rely on your judgment," and was told, "It is very good wood."
Turner bought the ladder, and his employee, Sam. Jones, was injured when it broke
under his weight (150 lbs). The cause was a defective siderail consiating "Of cross-
grained wood. The defect was not discoverable upon careful examination. Discuss
the rights of both Jones and Turner against Central Hardware Co. and Safety First
Ladder Manufacturing Company.

2. B came into S' s general clothing store and said that he heard that S wanted to
sell his entire stock of shoes. S said that was true but the price would be
$1000, "strictly cash down on the barrel head, possession to be taken on payment."
B said, "All right, here's my check" (on an out-of-town bank). After considerable
talk, B persuaded S to take the check, and S wrote B a receipt, as follows:
"Received of B, check in the amount of $1000, full amount due for all shoes in
store, if check is good." The next day B, with the help of S, stacked all the
shoes in the rear of the store. While S was out to lunch, B sold T the shoes for
$1200 (which T paid B $^00 in cash, $U00 in cancellation of an old debt owed by

B to T, and the remaining $1+00 by a one-year promissory note at 6$>). T had pre-
viously had satisfactory dealings with B and believed B' s story that he had bought
the shoes from S. S promptly sent the check to the bank for collection but it
came back five days later marked "insufficient funds." Meanwhile B had disappeared
and T had carried the shoes to his place of business fifty miles away. S now sues
T for conversion of the shoes. Give contentions of both parties and the court's
holding.

3- In August 1959 the following instrument was executed in Peoria by Millikan
Chevrolet Agency to First National Bank:

"RECEIVED FROM THE FIRST NATIONAL BANK on behalf of Millikan Chev-
rolet Agency merchandise specified in bill of lading No. , Interstate

Trucking Co., covering four Chevrolet automobiles /serial numbers/ which
we hereby agree to hold in trust for the account and benefit of said
bank, with power to sell the same and in case of sale to pay over to it
forthwith the proceeds thereof, consisting of cash or conditional sales
obligations, as security for any sums due or to become due said bank on
account of purchase of these automobiles and also as security for any
other indebtedness frcm us to said bank.

Final Examination in Law 337, First Semester 1959-1960 Page 2

"The delivery of the automobiles shall not operate as a waiver of
the title retained by said bank in the automobiles, and the bank may at
any time enter and reetaxie possession.

"Until the sale of any automobile covered by this receipt, we agree
to keep the same insured against loss by fire, in the name of said bank,
and to deliver the policies of insurance to it.

Millikan Chevrolet Agency"

Five months prior to the execution of the above instrument, First National
Bank had filed in the Secretary of State's office proper statements of trust receipt
financing of Millikan' s stocks of automobiles, but the above instrument was not
recorded anywhere.

(a) If prior to receiving the automobiles from the Trucking Co., Millikan
Chevrolet Agency pledges the bill of lading with the Citizens Bank as_security for

a new loan, what are the rights between First National Bank and Citizens Bank? What
additional fact or factor, not stated, is required for your answer?

(b) Assume that Millikan Chevrolet Agency receives the four automobiles from
the Trucking Co. and delivers the bill of lading to the Trucking Co. for cancella-
tion, and moves the automobiles to its showroom. One of the Chevrolets was sold
for cash to Adams. Another was sold to Baker under a conditional sales contract,
which Millikan assigned to Peoples' Finance Company as security for a loan by
Peoples' to Millikan. The remaining two automobiles were sold to Mercantile
Finance Company for use on the job by two of Mercantile' s employees; Mercantile gave
Millikan as consideration $1000 in cash plus two used Plymouth automobiles. Milli-
kan then gave a trust receipt on the two Plymouths to Commercial Trust Company as
security for another loan, and Commercial filed the statement of trust receipt
financing with the Secretary of State. Then Millikan filed his petition in bank-
ruptcy, adjudication was had, and a trustee in bankruptcy appointed. Discuss

very briefly the rights of First National Bank against the following parties:

(1) Adams, with regard to the Chevrolet sold to him;

(2) Peoples' Finance Company, with regard to the conditional sales

contracts assigned to it;

(3) Mercantile Finance Company, in respect to the two automobiles

sold to it;
(k) Commercial Trust Company, in respect to the two Plymouths;
(5) Millikan' s trustee in bankruptcy, as to funds on hand.

k. A sold to B 100 bushels of wheat in C's warehouse at $1.00 a bushel. C had in
storage 1500 bushels of wheat of the kind and grade which A sold to B, and A had
receipts for 200 bushels held by C. The entire amount was mixed together in C's
storage bins. B gave to A his time draft for the agreed price and A gave B a
delivery order on C for 100 bushels. A called C on the telephone, told him about
the delivery order, and C said, "All right." B went into bankruptcy before the
draft was due or paid. A, upon hearing of B' s bankruptcy, told C that the delivery
order was revoked and to please hold the wheat according to his directions. B' s
trustee in bankruptcy brought replevin for the 100 bushels of wheat, tendering the
amount of the draft, a crop shortage having caused the market value of the wheat
to increase about 50$. The trustee joined both C and A in this action. A, however,
sold the 100 bushels to X at $1.50 a bushel, and gave X a delivery order and re-
ceived the cash. Hearing of this resale, B' s trustee in bankruptcy amended his
complaint to seek the proceeds of the sale, and tendered the amount of the draft for
the price. What is the court's holding as between A and B' s trustee? Can B' s
trustee hold C or X?

Final Examination in Law 337, First Semester 1959-1960 Page 3

5. (a) A owned a wagon which he agreed to sell to B for $60. It was agreed that
B was to pay for the wagon and take it away within a week and that he was not to
have it until he had paid for it. Exactly what transpired between A and B at the
time of the bargain is not too clear, but A says that B offered $60 and A replied,
"It's a deal," and the two shook hands and B departed. Two days after this agree-
ment, A' s barn was struck by lightning and the wagon burned. What, if anything,
may A recover from B?

(b) S harvested his potato crop of seme 12 to lU tons and, after B had in-
spected them in several piles in the field, it was agreed that S would sell and B
would buy the entire crop at $2.80 per hundredweight. S was to take them as they
were in the field and have them weighed on designated public scales, and B was to
pay according to the weight tickets. It was understood that B was to pay for the
potatoes he took one day before he loaded any potatoes. The same night as the
agreement and before any potatoes were taken by B, there was a very unusual cold
wave, which froze the potatoes and made them practically worthless. B refused to
take the potatoes and S has filed this action for the price. Please decide and
discuss briefly.

6. The Great Atlantic and Pacific Tea Co., Chicago Branch ("A & P" ) bought its
fall supply of cranberries from Ocean Spray Cranberries, Inc., of the State of
Washington, under an agreement calling for shipment of 10,000 pounds per week, to
be shipped by rail from Seattle to Chicago under contract terms, the substance of
which may be condensed as follows: "Place of delivery, Chicago; terms, net cash
upon receipt of shipping documents with draft drawn by shipper upon A & P; price,
8 cents per pound shipping weight; to be shipped F.O.B. cars Chicago, C.I.F.
Chicago; inspection at Chicago." The shipment of the week of November 1 arrived
and was paid for and distributed by A & P to its retail grocery stores. Some of
this shipment was sold at retail to the public, resulting in some complaints and
returns, and the remaining portion was later taken from the shelves. The shipment
of the week of November 8 was put on board cars of the Union Pacific Railroad at
Seattle, with bill of lading to the order of Ocean Spray Cranberries, Inc., but
indorsed in blank and sent by air mail to Ocean Spray' s agent in Chicago, together
with draft upon A & P, certificate of insurance adequate to cover the shipment and
the invoice. Upon arrival in Chicago the cranberries were impounded by order of
the Chicago Board of Health, acting under advice from federal authorities that
Washington cranberries were potentially dangerous to human beings because sprayed
with aminotriazole, a chemical shown to produce cancer in rats. In fact these
particular cranberries had not been so sprayed. A & P refused to pay the draft,
and sued Ocean Spray for damages. Ocean Spray counterclaimed for the price as
represented by the amount of the draft. What decision and why?

FINAL EXAMINATION IN SALES (Law 337)
Summer Session i960 Professor Hawkland

Length of Examination: 2 Hours

Instructions: This is not an open-book examination, but students
may use the Statutory Supplement which was prepared
for use with Bogert and Britton's Cases on Sales.

All questions count equally.

I. Sam told Bill that he owned a threshing machine that was about to make me a
mint of money." Bill expressed an interest in the machine, and told Sam he
would like to buy it. Sam explained that the machine was in use in the western

part of the state, some distance away, but that he was willing to sell it to Bill
"sight unseen." Sam said, "Since the machine is used, I can give no warranties.
But the last I knew, it was in pretty good condition." Bill made a telephone call
to the place where the machine was located, and he received an accurate report that
the machine was working well. Bill then offered to buy the machine for $5,000.00.
Sam agreed to sell, and a bill of sale was prepared and signed by both parties.
The bill of sale contained no provision concerning delivery of the machine, but it
did contain a stipulation which read as follows: "The seller makes no warranties,
express or implied." Bill handed over the $5>0°0'00 to Sam.

A week or so later, Bill asked Sam when he was going to bring the machine to
him. Sam expressed amazement and told Bill that it was up to Bill to go out and
get it. Bill rejected this suggestion and finally told Sam, "I'll see you in court
about this."

Bill started an action to rescind the sale and recover his price. At a pre-
trial conference it was determined that the machine was encumbered by a chattel
mortgage which was duly recorded at the time of the sale by Sam to Bill. The mort-
gage secured a loan of $i+, 500.00 which Henry James had made from the National Bank.
James later sold the machine to Sam and concealed the fact from Sam that the machine
was mortgaged. It was also revealed at the pre-trial conference that Sam had never
made a profit with the threshing machine and had no reason to think he could ever
make much of a profit with. it.

How should the Bill vs. Sam case be decided?

II. Ennui was in the business of financing dealers in their purchase of new appli-
ances for resale. Troy was such a dealer. On March 29, 1958* Ennui filed with
the Secretary of State a "Statement of Trust Receipt Financing," designating

Troy as trustee and the goods as "new refrigerators and ranges." On April 11, i960,
the manufacturer of refrigerators for which Troy was the dealer, in accordance with
past practices, shipped ten new refrigerators to the city where both Troy and Ennui
were in business. The shipment was by a negotiable bill of lading made deliverable
to the order of the manufacturer. The bill of lading, with a draft drawn on Ennui,
was sent to Ennui's bank, and Ennui vras notified of the shipment. Before the
arrival of the refrigerators on April 15, Ennui procured trust receipts from Troy
covering them. Ennui paid the draft by a check certified by his bank and payable
to the manufacturer. He received the bill of lading indorsed in blank by the manu-
facturer and surrendered it without further indorsement to Troy on April 15 • Troy
had procured a loan from Morgan Bank on March 2, i960, giving as security a chattel
mortgage "on all property now owned or hereafter acquired'1 by Troy in connection
with his business. The mortgage had been recorded on the same day. On April 16
Troy took the bill of lading to the Morgan Bank and, on the strength of his new ac-
quisitions, the bank made new advances to Troy under its mortgage, which Troy used
to pay some old debts. April 20, Crush, a judgment creditor of Troy, levied upon

Final Examination in Sales (Law 337), Summer Session i960 Page 2

the bill of lading and the sheriff took it into his possession. Learning of this,
Ennui stopped payment on his check. He then brought suit against Crush to enjoin
sale under the execution. Morgan Bank intervened to have its mortgage lien declared
prior to the interests of both Ennui and Crush. What result in Illinois?

III. Burns, a retail clothing merchant, and Smith entered into an oral contract under
which Smith agreed to manufacture some suits of clothing for Burns for a price
of $2,000.00. Under the contract Smith agreed to place buyer's labels and lot

numbers in the suits and to deliver them on November 1. Burns agreed to receive the
suits and pay for them at the same time. Smith manufactured the suits and delivered
them on November 1. Burns was ready to accept them, and he tendered to Smith his
own personal check in the amount of $2,000.00 drawn on a distant bank. Smith took
exception to the check, alleging that it would take two weeks to collect it, and
he insisted that Burns pay cash. Burns told Smith that it would take a few days to
raise the cash. To this Smith replied, "When you get the cash, let me know. But
I can't wait very long."

Burns began the process of raising the cash. On November 8, Smith, not having
heard from Burns, sold the suits to Bilko for $1,600.00. Smith made this sale be-
cause he feared that Burns was insolvent, due to a credit report which showed
Burns' s economic position to be marginal, and because he feared that he could not
get another good offer for the suits. Smith gave no notice to Burns about his in-
tention to resell, nor the time or place of the resale.

Smith now brings an action against Burns for the $U00.00 deficiency. Decide
the case.

IV. (Short-answer question. Give reasons for your answers, but be brief.)

Sam Seller and Bill Buyer made an oral contract for the sale to Buyer of a set
of sterling silver, "price to be set by Seller on delivery." Seller immedi-
ately wrote to Buyer, "This will confirm our oral agreement of yesterday for
the purchase of silver /giving terms/. ^/Signed/ Seller." Buyer did not reply to
this letter, but one week later he went to Seller's place of business, examined the
set of silver, and said, "I accept this silver. Will you hold it for me for one
week? I am presenting it to my wife on her birthday, and I don't want to take it
home until then." Seller agreed to do so. When the week was up, Buyer refused to
go through with the deal, and, in a letter to Seller, Buyer wrote, "I have been
advised by counsel that our agreement ^giving terms/ is not binding, and therefore
will not proceed therewith. ^Signed/ Buyer."

1. Is the agreement binding under the Uniform Sales Act? Under the Uniform
Commercial Code?

2. Suppose the goods were destroyed through no fault of Seller or Buyer after
Buyer had inspected them. Who would have the risk of loss under the Uniform Sales
Act?

3. Suppose that creditors of Seller had attached the goods during the week
that Seller held them for Buyer pending Buyer's wife's birthday. Would the
creditors acquire an interest in the goods superior to Buyer's interest in
Illinois? How about in states that have enacted the Commercial Code'7'

.

FINAL EXAMINATION IN SOCIAL LEGISLATION (Lav 358)
First Semester 1958-I959 Professor Flering

TIME: THREE HOURS
PART I
I. (15 points) Assume that the 1959 Illinois Legislature passes a Fair Employirent
Practices Act which contains the provisions included in the
attached extract. Consider the following problem under this
legislation:

The Arabian Knights Oil Co. maintains offices in the city of Chicago, where it
has, and has had for many years, hundreds of clerical employees. It also has exter;
sive holdings in Saudi Arabia, for which it hires technicians. The Kingdom of Saudi
Arabia denies visas for work, trade or travel within its territory to all persons
of the Jewish faith. It is also known that the United States Department of State
is engaged in delicate negotiations with Saudi Arabia which are thought to be of
extreme importance to the policy of the Western Allies in the Near rast,

Arabian Knights Oil Co. is engaged in hiring, both for its Chicago office and
for its facilities in Saudi Arabia. Because the Kingdom of Saudi Arabia will not
issue a visa to a person of the Jewish faith, the Company decides it cannot hire
such a person for its facilities in that country. Moreover, certain of its techni-
cal employees in Chicago, and the chief receptionist, have more or less rejular
contact with visiting Arab dignitaries. For that reason and because it is fearful
that its facilities in Saudi Arabia will be nationalized, the Company feels that it
must not have a person of the Jewish faith in any such positions in Chicago. Pur-
suant to the above policy tne Company, in interviewing candidates for Saudi Arabian
positions, and for the sensitive positions in Chicago noted above, asks all candi-
dates about their religious faith and national origin. X, a highly qualified
technician of the Jewish faith, is immediately disqualified for a job in Scudi
Arabia. Y, a stunning and experienced receptionist, is likewise disqualified for
the receptionist' s job in Chicago because she is of the Jewish faith. Both complain
to the Illinois Equality of Employment Opportunity Commission.

After a hearing the Commission determines that the Company is an employer within
the meaning of the act, and that it has committed an unfair practice with respect
to both X and Y. It thereupon orders the Company to post a notice saying that it
will no longer discriminate, and to hire X and Y even if this means that those who
have been hired for the positions must be discharged. The Company refuses to comply
with any part of the order, and the Commission seeks enforcement in the court.
What result and why?

Assume the Company, instead of refusing to comply with the order, takes the
following action:

1. Agrees to post the order as directed.

2. Agrees to consider Y, since it has not yet hired a receptionist, along
with other candidates for the job. The Company ultimately takes Z in preference

to Y. Z is also a stunning and qualified receptionist. The Company frankry states
that one of her "merits" is that she is not of the Jewish faith and can therefore
meet visiting Arab dignitaries better than Y.

3- Hires X for the technicians position in Saudi Arabia, but when that
Kingdom declines to issue a visa to X, discharges him "for cause."

X and Y both complain to the Illinois Equality of Employment Opportunity Com-
mission about their treatment. What result and why?

■

Part I
Final Examination in Social Legislation, Law 358, First Semester 1958-9 Page 2

II. (20 points) Cable Company manufactures wire of all kinds. It is located in

Illinois, and its normal work force is UCO men. The following
incidents took place during 1958:

(1) B was employed in the wire-coating department. The odor of shellac in
this department often became so strong that employees were authorized to go into
the next room and stand next to the windows for some fresh air. Employees were
forbidden to go outside the building because there was a continuous movement of
trucks in the company drive which was deemed dangerous. On the occasion in question
the fumes became very strong and B ignored the company rule and stepped outside the
building. While he was standing there, a jet plane from a nearby air base went
out of control and came screaming into the company drive. B was not hit but he
became hysterical. Thereafter, although he was in no way impaired physically, ne
was never again able to work around noisy machinery because he was reminded of the
jet crash and became hysterical. Since he had had no training for other than a
production job, he finally became a night clerk at a local hotel at t. salarv of one-
third of what he had earned at Cable Company. Discuss and decide B's claim, if any.
against the Company.

(2) While B was hysterical, in the above incident, he rushed back into the
building, picked up an iron bar, and smashed it into C's leg. C was sitting at a
bench working at the time, but the blow broke his leg so badly that he was per-
manently crippled. C was able to return to work without bis leg1 s bothering him
because he had previously broken both arches in the employ of another cctrpany and
bad therefore been given a "sit-down" job at Cable Company. C now wants to know
what rights he has against Cable Company ard/or B. Discuss and decide.

(3) E is a skilled machinist who is an employee of Metal Co., located in St.
Louis, Missouri. He has been sent to Cable Company with a new machine which Cable
has purchased from Metal, to help install the machine and to teach an operator how
to make it work. While working on the machine at Cable Company, E sudienly drops
dead of a heart attack. A post-mortem reveals that E has been suffering frcm acute
heart disease. The doctor states that E' s death was in no sense brought on by the
work he was doing at the time of death and that there was an equal probability that
he would have died in his sleep. E is unmarried, but he has a dependent mother
who would like advice as to her rights, if any, against Cable Company and/cr Metal
C.

(k) F worked from 1956 to 1958 for Atomic Energies, Inc., which was located
in southern Illinois and which experimented in the production of atomic power.
Because he wanted to be nearer home, he left Atomic Energies, Inc., in 1952 and
came to work for the Cable Company. He was given the usual physical examination
and started work. In the fall of 1958 F1 s health began to deteriorate and be was
finally hospitalized, where he was found to be suffering from atomic radiation.
After spending three months in the hospital, F was released but was told that he
would never again be able to do more than light work. F now comes to you for
advice with respect to his rights against Cable Company and/or Atomic Energies, Ire.
Explain your advice.

III. (20 points) X brewery, doing business in the State of Illinois, employs 5C0

people. During the year 1959 the following incidents tcok place:

(l) B, who had worked in the loading room for fifteen years and had been
known as a competent employee, was called before a Congressional Committee and
asked whether he had ever been a Communist. B refused to answer and the committee

Pa era 9

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Part I
Final Examination in Social Legislation, Law 358, First Semester 1958-9 Page 3

has not yet decided whether to cite him for contempt. Following the committee hear-
ing B was called into the Personnel Office and asked the same question. He refused
to tell the Company whether or not he was, or had been, a Communist. Thereupon he
was discharged. B then filed a claim for unemployment compensation. He indicated
that he had been discharged for refusing to say whether he was, or ever had been,
a Communist, and he likewise refused to give this information to the UC office.
B duly registered for other employment and held himself out as ready and williug to
work when and if another job became available. Discuss the problems that are in-
volved with respect to B' s rights to unemployment compensation and decide the issue.

(2) Y union has a contract with X brewery under which X may not employ new
people while any qualified employee of X is laid off. During a period of extr?.
work X hired C, who knew of the above provision in the contract. Shortly thereafter
a lavoff in another section of the brewery made qualified employees available for
work and one of them bumped C out of his job. C now claims unemployment compensa-
tion but the brewery claims that C is not qualified because his unemployment is not
attributable to the company. What are the arguments which will be raised, and

what result would you predict;'

(3) D was a maintenance painter at the brewery. During the 1958 recr.sRion
the Company was not able to provide work for him and he was laid off. At the same
time, however, it was made known to D that because the company wished to ".^ee^ him
in its employ so that he could later be put back on painting, it would offer him

a job as a janitor in its downtown office building. D' s pay as a painter was
$3 per hour. The janitor's job paid $1.95. D lived outside the city, in the
direction of the brewery. The latter was ten miles from the heart of the city,
where its office building was located. D declined to accept the janitor's job even
though at the time there was a great deal of unemployment locally and the business
agent for the painters' union advised him that there were 100 painters cut of work
and looking for jobs. D filed his claim for unemployment compensation and indi-
cated that he was available for work. What problems are involved in deciding
whether D is entitled to unemployment compensation, and what is your decision?

(h) E, who had worked for the brewery for ten years, was extremely popular
with his fellow-employees and bad been very active in the union. At the age of
^0 he was suddenly stricken with an arthritic condition which made it impossible
for him to continue working. The affliction was not alleged to be work-cnnn^cted
and no claim for workmen' s compensation was filed. The brewery, partly out of
sympathy for E, who had five children, and partly to capitalize on his popularity,
suggested that E set up a public relations business in which his principal function
would be to publicize the brewery among the working people of the city. He would
do '•"his through his entre to union meetings. E liked the idea. It was agreed that
the brewery had no control over him whatsoever, that he could come and go as he
pleased, that his services, when performed, would be entirely in union halls, and
that he could accept or reject other clients as he pleased. For this the brewery
would pay him an annual fee of $2000, but it would in no way direct his efforts,
check on them, furnish him materials, or provide office space. E worked under the
arrangement for two years. At that time the brewery found that the 19?8 rec°ssion
was forcing it to cut back on expenses and the retainer for E was eliminated. E
then filed a claim for unemployment compensation. What considerations ar: involved
in deciding his claim, and what will the result be?

Page 3

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Part I
Final Examination in Social Legislation, Law 358, First Semester 1958-9 Page h

APPENDIX TO PART I

SOME. EXTRACTS FROM ASSUMED ILLINOIS FAIR EMPLOYMENT PRACTICES ACT

Section 1. Declaration of Policy. Denial of equal employment oprortunity "be-
cause of race, color, religion, national origin or ancestry and the consequent
failure to utilize the productive capacities of individuals to the fullest extent
deprives much of the population of the State of earnings necessary to maintain a
resemble standard of living, thereby causing many persons to resort to public
charity, and often causing conflicts and controversies resulting in grave injur/
to the public safety, health and welfare.

Therefore it is hereby declared to be the public policy of this State that the
right to equal employment opportunity is a fundamental right that should be pro-
tected by this State by law. Denial of this right is hereby declared to be against
the public policy of this State.

Section 2. Definitions. . . . (d) "Employer" includes all persons employing
more than twenty-five persons within the State within each of twenty or moie calen-
dar weeks, within either the current or preceding calendar year, except that the
term "employer" shall not include any religious, fraternal, sectarian, educacional
or charitable corporation, association or club exclusively social if such corpora-
tion, association or club is not organized for profit.

Section 3- Unfair Employment Practices. It shall be an unfair employment
practice:

(a) For an employer, because of the race, color, religion, national origin
or ancestry of any person, to refuse to hire, to segregate, or otherwise
discriminate against him with respect to hire, tenure, terms and condi-
tions of employment; . . .

Nothing in this Act shall preclude an employer from selecting
between persons of equal merit and ability, or from discharging
or taking disciplinary action against an employee for cause. . . ,

Section 5- Illinois Equality of Employment Opportunity Commission, (a)
There is created hereby the Illinois Equality of Employment Opportunity Commission.

• • •

Section 6. Powers and Duties of the Commission. The Commission shall have
the following powers and duties: . . .

(d) To adopt, promulgate, amend and rescind rules and regulations.

(e) To receive, cause to be investigated by its staff, and consider charges
of unfair employment practices and act upon them. . . .

Section 8. Procedure. . . . (e) When all the testimony has h^en taken the
Commission shall determine whether the respondent has engaged in or is engaging
in any unfair employment practice. The Commission then shall state its findings,
and if it finds against the respondent, shall issue and cause to be served on such
respondent and the complainant an order requiring such respondent tr cease and
desist from such unfair employment practices, and to take further affirmative or
other action as is required to enforce this Act, including but not limited to post-
ing of the order, hiring, reinstating, or upgrading of employees and admission or
restoration to union membership.

Page h

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Final Examination in Social Legislation, Law 358, First Semester 1958-9 Page 5

Part I
APPENDIX TO PART I - continued

Section 10. Judicial Review. Any complainant or respondent may apply for and
obtain judicial review of an order of the Commission . , . in accordance with the
provisions of the "Administrative Review Act"*, . . .

Section 11. Judicial Enforcement, (a) Whenever it shall appear that any
person has violated an order of the Commission . . . the Commission shall commence
an action . . . alleging the violation, attaching a copy of the order of the Com-
mission and praying for the issuance of an order in the nature of a writ of
mandamus, directing such person, his or her or its officers, agents, servants,
successors and assigns to comply with the order of the Commission.

*The Administrative Review Act provides: "The findings and conclusions oi
the administrative agency on questions of fact shall be held to be prim:* facie
true and correct."

Page 5

NAME NO .

FINAL EXAMINATION IN SOCIAL LEGISLATION (Law 358)
First Semester 1958-1959 Professor Fleming

PART II
IV. (25 points) The following objective questions may be answered by circling

either the T, for True, or the F, for False.

T F 1. Interpretation of the coverage of the Social Security Act has been com-
plicated by the fact that there is no definition of the term "employer"
or term "employee" in the Act.

T F 2. The 1956 amendments to the Social Security Act provided fw the payment
of disability benefits to all persons who could prove chat they were
permanently and totally disabled.

T F 3« Illegitimate children of a fully insured individual may never claits bene-
fits under the provisions of the Social Security Act.

T F k. X, a fully insured employee, is the sole support of his mother. X con-
tracts "Lou Gehrig's" disease, and dies a lingering death after 11 months
in the hospital. During the last three months of this period, Y, X' s
sister, took over support of the mother. On X' s death his mother is
not entitled to benefits resulting from his coverage under the Social
Security Act.

T F 5- After X1 s death his administrator found that X had saved six primary
benefit checks without cashing them. At the same time a final check
came in, covering a period which extended ten days beyond X's life.
The administrator was entitled to cash all of the checks.

T F 6. Under the 1958 amendments to the Social Security Act, the trustee of

OASI funds is entitled to maintain a ratio of investment of sucn funds
of 6c$> government bonds and kQ><$> private "blue chip" stocks.

T F 7- Under both private pension plans and OASI, once the individual has ful-
f i lied all the requirements for receiving a pension, he will receive the
pension regardless of what work or earnings he has thereafter.

T F 8. The Australian old age pension program is based upon a means test.

T F 9- The Internal Revenue Code provides that in order for a private pension
plan to be tax exempt, it must require both a minimum age and a minimum
period of service in order for the individual to be eligible for oenefits.

T F 10. The Internal Revenue Commission will approve differences in contributions
and benefits under an integrated and correlated pension pr.an, providing
higher paid employees will not receive proportionately greater benefits
than lower paid employees.

T F 11. Though the Labor-Management Relations Act of 19U7 has been held to require
bargaining over pensions, the company may unilaterally change the level
of benefits thereunder if the plan is non-contributory.

T F 12. Some courts have held that a competent employee may not be required to

retire at age 65 simply because the unilateral company retirement policy
so provides if the employee is protected by a collective bargaining
contract which authorizes discharge only for "cause."

Final Examination in Social Legislation, Lav 356, First Semester 1958-9 Part II

Fage 2

T F 13. The Welfare and Pension Flans Disclosure Act of 1958 was passed as the

result of Congressional investigations which showed abuses in the handling
of such funds in recent years.

T F lh. Supplementation of OASI benefits by private pension plans is no longer
legal since the 1958 amendments to the Social Security Act.

T F 15- Some states permit an employee who is retiring on pension benefits to
draw unemployment compensation during this same period if he registers
and is looking for work.

T F l6. A distinguishing feature of public assistance, as compared with CASI
benefits, is that the former is based on a means test.

T F 17. The primary reason why old age assistance benefits vary so vilely frcn

state to state is that seme states, like California and Florida, lave so
many more old people than others.

T F l8. It is possible for a recipient of OASI benefits to collect old age
assistance also.

T F 19. President Eisenhower's re-insurance program, which was submitted to the

Congress in 1952, would have protected the financial stability of private
pension plans by permitting the parties to re-insure benefits above -.nd
beyond those provided under OASI with the federal government.

T F 20. A major gap in the American social insurance field is that the employee
who is unemployed because of illness is ineligible for unemployment
compensation except in a few states.

T F 21. OASI benefits are now kept abreast of inflationary trends by adjusting

them according to the cost-of-living index put out by the Bureau of Labor
Statistics.

T F 22. The joint federal-state system of unemployment compensation requires the
federal government to pay each state for the cost of administering the
program.

T F 23. The "merit rating'' principle, which is widely used under unemployment
compensation laws, is popular with industry groups because it has the
effect of reducing taxes.

T F 2k. The reason members of the Itfusicians1 Union have worked cut stand-by

provisions in their collective bargaining contracts which require payment
for unnecessary work is that musicians are not covered by the unemploy-
ment compensation act.

T F 25- In almost all foreign unemployment compensation systems, contributions
are made by both employers and employees.

Part II, Page 2

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Final Examination in Social Legislation, Law 358, First semester 1958-9 Part II

Page 3
V. (20 points) The following objective questions may be answered by circling
either the T, for True, or the F, for False.

T F 1. The fellow- servant rule at common law, which made recovery for a work-
incurred injury difficult, meant that one had to show that a felDow-
worker caused the accident before the employer could be held liable.

T F 2. State health and safety statutes, such as are found in Illinois, usually
make non-compliance with the act negligence per se.

T F 3. Under the Illinois Scaffolding Act, the employer cannot escape liability
^or willful violation of the act if the scaffold is unsafe even though
he thought it was safe and had in fact inspected it.

T F '+. The Illinois Minimum Fair Wage Standards for Women and Minors Act is now
largely inoperative because of legal difficulties having to do with find-
ings of fact and details of issuing a wage order.

T F 5. Plant safety is never a matter for collective bargaining oecause it is
controlled by state statutes.

T F 6. The State of Illinois has supplemented its workmen's compensation act
by establishing an excellent rehabilitation program.

TFT. The "agreed-bill" process for amending Illinois workmen's compensation
and unemployment compensation statutes means that the Republican and
Democratic parties appoint a small sub-committee which reaches an inter-
party agreement on changes, which agreement is then adopted.

T F 8. In order for an employer to get a patent on an invention by one of his
employees, the employer must show either that the inventor was engaged
specifically to e- -reise his inventive faculties for the employee, or that
the invention was conceived and developed during working hours with the
aid of fellow- employees and with the use of the employer' s machinery
and materials.

T F 9» Early efforts on the part of states to regulate hours and wages were
declared to be unconstitutional on the ground that they impaired the
right of the employer and the employee to contract.

T F 10. The original purpose of the Fair Labor Standards Act was to put more

purchasing power in the hands of employees by forcing employers to pay
overtime for work beyond Uo hours in a week or 8 hours in a day.

T F 11. It is sufficient to bring employees under the Fair Labor Standards Act

if their employer is engaged in interstate commerce and they are essential
to the conduct of his business.

T F 12. Exempt work under the FLSA is irrmediately made subject to the act if the
employee engages in any covered employment during the same period.

I F 13. The Belo rule is associated with tne 19^-9 amendments to the FLSA, which
made guaranteed annual wage plans exempt from the act when they met cer-
tain standards prescribed in the act.

Part II, Page
3

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Final Examination in Social Legislation, Law 358, First Semester 1958-9 Part II

Page h

T F ih. The courts have held that under the National Labor Relations Act, the

Congress exercised the full scope of the commerce power, while mder the
FLSA it did not.

T F 15. The 50 per hour which the automobile companies pay into the trust fund
to finance supplemental unemployment benefits is a part of the "regular
rate" for purposes of the calculation required under the FLSA.

T F l6. The FLSA provides for certain exemptions from the maximvm hours provisions
without at the same time giving an exemption from the minimum wcge re-
quirements .

T F 17. An employee may sue under the provisions of the FLSA in either the state
or federal court for unpaid minimum wages and overtime compensation.

T F 18. The Portal-to-Portal Act, which requires the employer to compenbate his
employees while engaged in their "principal activity or p_tivities",
does not include time spent in changing clothes even where special
clothes are required if there is a past practice to the contrary.

T F 19. Unlike coverage under the FLSA, which in all cases depends upon tb"

activities of the individual employee, the basis for the application of
exemptions varies: sometimes it is phrased in terms of tv; individual's
activities; sometimes it relates to the nature of the industry; etc.

T F 20. An employee is covered by the wage and hour provisions of the FLSA if he
is engaged in the production of goods for commerce. Stocks, bonds, bills
of exchange, and insurance policies have all been held to be "goods."

Part II, Fage h

NAME NO .

FINAL EXAMINATION IN SOCIAL LEGISLATION (Law 358)
Second Semester 1959-I960 Professor Fleming

TIME: 3 1/2 Hours

Each of the five questions has a point value of 20.

I. Employees A, B, and C all work for X quarry in the State of Illinois. In the
spring of i960 they were involved in the following incidents:

While walking to the parking lot at the end of work one day, A was hit by a
falling wheel which had become detached from a commercial airliner flying overhead.
The plane belonged to the Y company. It did not normally fly over the quarry but
because of bad weather the pilot was following a somewhat circuitous route. Mr. A
sustained serious but not fatal injuries from the impact of the wheel. However,
fellow-employees D and E moved him so negligently after the injury that complica-
tions were caused which resulted in A' s death. What rights, if any, have A's heirs
against: (l) X company, (2) fellow -employees D and E, and (3) Y company? Explain.

During the midmorning break B, who held a timekeeper's job because in an acci-
dent on a previous job for another company he had lost his left hand in a punch
press, went to a nearby shed to get his thermos of coffee. In complete violation
of company rules against drinking on the job, B had laced the coffee with whiskey.
While standing in the shed drinking the coffee, B set the thermos down on a metal
heater powered by electricity. When he did so a short in the heater was transmitted
through the metal thermos to him, with the result that he suffered severe burns.
Naturally, the thermos spilled, with the result that everyone knew its contents.
B was incapacitated for three weeks as the result of the burns. What rights, if
any, has B against X company? Explain.

C drove a truck for X company. In the course of his customer contacts he con-
tracted smallpox from a customer who was himself just coming down with it and who
was in a highly contagious condition. C was ill for two months, partly because a
chronic silicosis condition contracted at the quarry had left him in a weakened
condition to fight smallpox. What claim, if any, has C against X company? Explain.

II. X company is a supplier of door handles and other small hardware for Y auto
company. Both companies are located in Illinois and are organized by locals of
the International Autoworkers Union. X is not a subsidiary of Y, but there is a
substantial overlap among the large stockholders in the two corporations.

Mr. A has been employed at the X company for ten years as a skilled machinist.
His hourly rate is $3-25. Recently his wife contracted a respiratory ailment for
the cure of which her doctor thought a year's residence in Tucson, Arizona, would
be the only remedy. Six weeks after she had gone to Tucson, A became lonesome and
decided to give up his job and join her. Upon arrival in Tucson he registered at
the employment service, but found that there were no openings for skilled machinists
at the moment. As a matter of fact, the only job then open was that of a night
watchman at one of the local banks. The pay was $1.75 Ver hour. In preference to
taking this A decided to apply for unemployment compensation. How would he go about
doing this, what would be his problems in qualifying, and what result do you predict?

Mr. B, a janitor in the X plant, was arrested on a morals charge when he mo-
lested an 8-year-old boy. Pending trial he was released on bail. The local news-
paper gave a good deal of publicity to the matter, including a statement of the name
of B' s employer. After that the president of X received many letters suggesting that
he fire B. Shortly thereafter B was discharged on the ground that he had brought
unfavorable publicity to the company and was disrupting the harmony of the work
force. What problems will arise if B applies for unemployment compensation, and

Final Examination in Social Legislation (Lav; 358), Second Semester 1959-60 Page 2

On April 1, i960, the local union at X plant entered negotiations with the
company. By May 1 an impasse had been reached and a strike was called. When in-
formed of the strike, the employees at Y, fearing that exhaustion of the supply of
door handles would shut down production at Y, began a calculated slow down. In
spite of this tactic, Y laid off several assemblers on the ground that not so many
were needed when door handles were in short supply. By June 1 the supply of door
handles was so low that Y could continue for only another week. Rather than so con-
tinue, Y decided to shut the plant down, hoping that by doing so the local union
would bring pressure on its sister local to settle the dispute at X so that produc-
tion could be resumed at both plants. On June 15 Y decided this was an erroneous
tactic, reopened its plant, and recalled all the workers. At the same time X an-
nounced that it was terminating all of its employees and would hire replacements.
On June 18 the strikers at X placed a picket before the Y plant in an effort to
bring pressure through Y on X to negotiate a contract with the union at X. This had
the effect of again closing the plant at Y, though there was no violence. Ulti-
mately, on July 1, a new contract was reached with the union at X and both plants
went back to work. Because it took the plants a few days to get back in operation,
employees were delayed over a period of a week in returning. What unemployment com-
pensation questions are raised in this set of facts, and what answers would you
predict?

III. X company is engaged in the business of purchasing wrecked or burned late
model automobiles. After stripping the cars of such items as generators and motors,
which are sold locally, the residue is sold for scrap metal to Y company, which is
located on the adjoining lot. Y buys scrap metal from several sources and then
sells it to local manufacturers who use it in the production of their products, most
of which are shipped outside the state. X's records show that for the past fiscal
year it sold less than 100 tons of scrap metal to Y, and that the receipts from this
sale constituted 1.67$ of X's total income during this period.

X employs a night watchman at $50 per week, for 50 hours of work. His sole
function is to watch the establishment, including the piles of parts and scrap.
Four other employees strip the cars of salvageable parts. They earn $96 per week,
with the understanding that they will work from kO to hQ hours each week according
to the demands of the job. In fact they work more than ^0 hours only about half
the time. Another man drives a wrecker to pick up automobiles and bring them to
the company's yard. He is paid on the same basis as the four salvage men and helps
strip cars during his spare time. Finally, there is one skilled machinist who works
from 1 to 5 p.m., six days per week, checking over salvaged parts to be sure they
are in working order. Since this does not take his full time, the machinist works
from 8 to 12 a.m., six days per week, for the Z company, which is located across
the street and which is owned and operated by the brother of the man who owns X
company. The machinist is paid $2.25 per hour for each hour worked for both X
and Z, and when the demands of either job require more hours on any given day, it
is understood that the machinist may continue at the job he is on until it is
completed.

During the spring of i960, the four salvage men and the driver asked for a
raise In pay. In response X suggested the following plan: Each man would be guar-
anteed $100 per week in return for signing individual contracts which called for a
basic hourly rate of $2.00 per hour with time and one-half after Uo hours, with the
understanding that the work week would consist of not more than 50 hours. The four
employees agreed to this plan and the contracts were signed.

What problems do the above set of facts raise under the Fair Labor Standards
Act, and what rulings would ycu anticipate?

Final Examination in Social Legislation (Law 358), Second Semester 1959-60 Page 3

IV. Assuming House Bill No. 2, as proposed in the 71st General Assembly of Illi-
nois, was passed, answer the following questions:

X corporation manufactures storage bins for surplus agricultural products.
It employs 100 clerical personnel and about 600 production workers. The latter are
members of Local 200 of the United Bin Builders of America. In hiring clerical
workers X administers an aptitude test acquired from the local vocational school,
requires a physical examination, and awards points for personality as judged by the
interviewer.

Miss A, who is a Negress, applied for one of the clerical jobs. She passed the
aptitude test and the physical, but was judged low on personality. The position was
awarded to Miss B, a white girl, who scored somewhat less on the aptitude test,
passed the physical, and was given a high personality rating. Miss B had been the
president of her high school class. There were Negroes in the production force at
X, but as of the present time no Negroes on the clerical staff. What complaint, if
any, does Miss A have, and what may the Illinois Equality of Employment Opportunity
Commission do about it?

Miss C, a rather plain single woman about 30 years of age, had been the recep-
tionist at the plant for five years. Unhappy with her unmarried state, Miss C was
attracted to and joined a new religious organization which espoused polygamy, on
the ground that woman's most sacred function was producing offspring, and since
there were more women than men in the population, polygamous marriages were desir-
able as a matter of moral principle. This religious sect received considerable
local publicity, and Miss C was identified with it. Fearing that ridicule and
scorn which were being generated locally towards the organization might hurt its
business, X removed Miss C as a receptionist and gave her a job which paid equally
well in another portion of the business office where she did not have access to
the public. Miss C did not like this move. What complaint, if any, does she have
under the above law, and what may the Commission do about it?

All of the janitors at the X plant were recently arrived Puerto Ricans who
spoke only Spanish. They were readily accepted into the union, but the union
insisted that since the passage of the 1959 labor law amendments requiring greater
internal union democracy, it was necessary for all workers who wished to be employed
in classifications above that of janitor to pass a basic English test as adminis-
tered by the local high school so that they could intelligently participate in and
understand the affairs of the union. The company would have been prepared to accept
Puerto Ricans in other jobs except for the attitude of the union. There is no
claim that the English test is unfairly administered, though up to the present time
no Puerto Rican has qualified for a job above the classification of janitor. Do
the Puerto Ricans have a valid complaint, and if so, what may the Commission do
about it?

V. Answer the following questions in the brief spaces allowed:

1. The basic difference in coverage between the National Labor Relations Act and
the Fair Labor Standards Act is:

1

Final Examination in Social Legislation (Law 358), Second Semester 1959-6° Page h

2. A principal reason why so much of the health and safety legislation is found in
state rather than federal statutes is:

3. "Willful violation" of the Illinois Scaffolding Act has been construed to mean
that the employer will be liable when:

k. Liability under the Scaffolding Act in Illinois is affected by the Workmen's
Compensation Law in the following fashion:

5. Tort actions at common law were relatively unsuccessful where an employee tried
to sue his employer for a work- incurred injury because:

6. It is thought that some workers who have incurred serious injuries for which
they are being compensated through Workmen1 s Compensation benefits resist efforts
at rehabilitation because:

7. If Miss X ,who has received a disfiguring facial scar in a factory accident and
has been compensated therefor under Workmen's Compensation, wants to bring an
action in tort against her employer for damages arising out of social embarrassment
and loss of friends, what will your advice to her be, and why?

8. Under what circumstances, if any, may an injured employee bring an action under
the workmen' s compensation statute of more than one state?

Final Examination in Social Legislation (Law 358), Second Semester 1959-60 Page 5

9- The essence of the argument in favor of disability insurance, which is now
available in only a few states, is:

10. The general rule with respect to the right to inventions may be stated as
follows:

11. The theory of the overtime -a fter-UO-hours requirement of the Fair Labor Stand-
ards Act at the time the act was passed was:

12. One of the principal criticisms of the merit cr experience rating principle
in unemployment compensation is that:

13- Some employers would prefer to pay the entire tax for supporting the unemploy-
ment compensation system rather than have employees contribute because:

Ik. State unemployment compensation agencies found it necessary to work out
reciprocity agreements because:

15. A significant corporate asset in the unemployment compensation field consists
of:

Final Examination in Social Legislation (Law 358), Second Semester 1959-60 Page 6

l6. Typical administrative problems faced by the Social Security Administration in
deciding entitlement to benefits would be: (give at least three)

17. Some of the reasons why private employers have found it desirable to establish
private pension plans are: (give at least four)

18. The argument that social security benefits are paid for twice is based upon:

19. The rationale behind permitting an executor to collect retirement benefits
due but unpaid to the deceased is that:

20. Some tax problems which arise in connection with the establishment of a
private pension scheme are: (give at least three)

FINAL EXAMINATION IN STATE AND LOCAL TAXATION (Law 3U9)
First Semester 1959-1960 Professor Young

TIME: 3 HOURS

Instructions: (l) Begin the first question on the second page of the

examination book.

(2) Plan your answers carefully and state your reasons fully.

(3) Adhere to the indicated space limitations.

1. D, a resident of State X, was engaged in the business of selling fresh fruits and
vegetables at wholesale in a principal city in State X. It was his practice to pur-
chase and sell these items in carload lots. His source of supply was primarily the
states of California, Florida, and Texas, where he made his purchases through local
agents. State X imposed, among others, the following taxes: (a) a general property
tax; (b) a flat 2$ gross income tax upon gross income including gross income derived
from trade or business conducted in the state; and (c) an inheritance tax. D died
January 2, 1959- On December 30, 1958, he had sold to A, one of his best customers,
ten cars of citrus fruit which were to be shipped from California. The memorandum
of sale read: "D has hereby sold to A, ten (10) cars of California citrus fruit
represented by the following bills of lading: . . . Payment of the purchase price
shall be made upon receipt and inspection of the merchandise by the purchaser."
The bills of lading covering these shipments were properly identified in the memoran-
dum. D' s California agent had purchased the ten cars of fruit on December 29. On
the same day, the agent obtained negotiable bills of lading in D1 s name and wired the
descriptive information to D. The ten cars were moved out of California by the rail-
road carrier on December 29, 1958, hut the bills of lading were held by the agent
until January h, 1959- On that date they were posted via air mail to D. They were
received at D1 s place of business on January 6. The shipment of the cars was delayed
in Omaha on December 31 as a consequence of a severe blizzard. To provide addi-
tional shelter from the freezing weather, the freight cars were shunted into a large
railroad shed in the Omaha terminal area. The cars were held there from December 31,
1958, until January k, 1959, when shipment was resumed. The railroad carrier
tendered delivery of the cars at D' s warehouse in State X on January 6. D' s office
manager advised the carrier that the cars should be placed at A' s warehouse, and
the bills of lading, properly endorsed, were delivered to A. The shipment was
accepted by A and payment of the purchase price was made to D' s executor. The only
family member who survived D was his daughter R, who is married and resides in
Florida. She is the sole beneficiary of D' s estate.

You are attorney for the executor of D' s estate. He has received the following
tax bills and requests your advice as to whether these should be paid. You are to
assume that in each instance the taxes assessed are within the scope of the re-
spective state statutory provisions. What do you advise? Discuss fully.

(1) (5$>) California assessed a property tax upon the value of the bills of lading
in the hands of D' s agent in California on January 1, 1959, which was tax day under
the California statute. (l/2 page)

(2) (5$) Nebraska assessed a property tax upon the value of the fruit held in
storage in the cars placed in the car shed in Omaha on January 1, 1959, which was
tax day for Nebraska. (l/2 page)

(3) (10$>) State X assessed a personal property tax upon the value of the ten cars
of fruit which had been purchased by D' s agent on December 29. State X also
assessed a personal property tax upon the amount due under the contract of sale
entered into on December 30 with A. January 1 was tax day in State X, but it was

Final Examination in Law 3U9, First Semester 1959-1960 Page 2

also provided that any property brought into the state after January 1 and prior to
June 1 should he added to the tax rolls for the calendar year, (l page)

{k) (10$) State X assessed an inheritance tax upon D' s estate by including in the
taxable estate the value of the 10 cars of fruit and the amount due at the date of
death under the contract of sale entered into with A on December 3°. (l Page)

(5) (5$) Nebraska assessed an inheritance tax upon the value of the ten cars of
fruit in storage in Omaha on the date of D* s death. (l/2 page)

(6) (5$) Florida assessed an inheritance tax upon the value of R's inheritance,
including the value of the ten cars of fruit and the amount due under the contract
with A. (1/2 page)

(7) (10$) State X assessed a gross income tax upon the amount realized upon the
sale to A. (1 page)

2. You are legal adviser to a member of the Illinois General Assembly who is Chair-
man of the Revenue Committee of the House. He has requested your advice as to the
validity of the following legislative proposals which are under consideration.
Discuss each proposal, limiting your comments to the space indicated.

(1) (10$) A major problem in the administration of the local property tax is the
assessment of industrial and manufacturing plants. These properties are presently
assessed by local assessment officials who rarely have the necessary training or
experience required for the proper performance of this task. It is proposed that
the responsibility for assessing such property be vested in the State Department of
Revenue. The assessment would be made by the Department and certified to the local
authorities in the same manner as the assessment of railroad property. To finance
this function, a special property tax would be imposed by the State upon industrial
and manufacturing properties throughout the State. These funds would be earmarked
for the payment of salaries and other expenses incurred by the Department of Revenue
in making these assessments, (l page)

(2) (10$) It is proposed that the provisions with respect to the taxation of per-
sonal property brought into the State after April 1 be changed to provide that such
property shall be assessed only for the fractional portion of the year that the
property is present in the State. To illustrate, if property were brought into the
State on July 1, it would be assessed at 50$ of the full assessed value for the
particular year; if it were brought in on September 1, at 33$; and if it were
brought in on October 1, at 25$. The sponsors of this proposal emphasize the fact
that the property in these circumstances enjoys the protection and benefit of
Illinois law only for a fractional portion of the tax year. (1 page)

(3) (10$) It is proposed that the provisions for the assessment and valuation of
improvements upon real property under construction on January 1 each year (tax day
for real property), be assessed at 10$ of the cost of construction incurred up to
the assessment date. Sponsors of this proposal point out that improvements under
construction do not represent income producing property and that lessening of the
tax load upon buildings under construction will tend to encourage economic activity.
(1 page)

Final Examination in Law 3^9, First Semester 1959-1960 Page 3

3. (20$>) R, a resident of Champaign County, Illinois, died in July 1958, leaving
the residue of his estate on trust with the provision that the yearly income be
divided equally between the following universities: Illinois, Columbia, Michigan,
and Pennsylvania. It was further provided that each university should apply the
amounts received under the trust to scholarships for worthy students. The residuary
estate consisted of Illinois farm land of the value of $200,000 and various common
stocks having a value of $300,000. You are attorney for the trustee under the trust.
He informs you that he has received property tax bills for the year 1959 based upon
an assessment of the farm land and common stocks at full market value. All other
property on the tax rolls has been assessed at approximately 50$> of full value.
The trustee requests your advice as to whether he should proceed to pay the taxes.
What do you advise? Discuss fully. (2 pages)

FINAL EXAMINATION IN STATE AND LOCAL TAXATION (Law 3^9)
Summer Session i960 Professor Young

ALLOWED TIME: 3 HOURS

Instructions: (l) Begin the first question on the second page of the

examination book.

(2) Plan your answers carefully and state your reasons
fully.

(3) Adhere to the indicated maximum space limitations.

I. The Cannonball Express Co., an Iowa corporation, operates an interstate truck-
ing business between Omaha, Nebraska, and Indianapoli6, Indiana. The company
has offices, shipping depots and warehouse facilities not only in Omaha and
Indianapolis, but also in Des Moines and Davenport, Iowa; Rock Island, Peoria,
Champaign, and Danville, Illinois; and LaFayette, Indiana. The principal office of
the corporation, however, is in Davenport, Iowa, where the company maintains a garage
to provide regular servicing and major repairs to its fleet of one hundred trucks.
A small truck is permanently assigned to each depot in the several cities to handle
the pick-up and delivery of small loads within the area served by each local office.
The company handles shipments between cities within each state as well as shipments
between cities in the different states. The assets of the corporation total
$1,000,000, consisting of a fleet of trucks valued at $500,000 and office, depot and
warehouse facilities alsc valued at $500,000. The office, depot and warehouse facil-
ities are allocated among the several states in approximately the following ratios:
Nebraska, 10$; Iowa, ^0$; Illinois, 30$; and Indiana, 20$. On a ton-mileage basis,
the fleet of trucks is operated continuously through the several states on approx-
imately the following basis: Nebraska, 5$; Iowa, 35$; Illinois, 35$; and Indiana,
25$. With this information as a background, consider the following problems.

A. (10$) The tax authorities of Iowa have assessed a personal property tax upon

the entire fleet of one hundred trucks owned by the Cannonball Express
Co. for the year 1959 as having a tax situs at the principal office in
Davenport. The assessment was made on tax day, October 1, 1959- On that date, only
twenty of the company trucks were in the State of Iowa. The 1959 Iowa tax bill has
been received by the corporation. Under the Iowa statutes it is provided that, in a
suit to collect taxes, the assessment shall be deemed prima facie correct. The
corporation requests your advice as to whether the tax should be paid. Discuss.
(1 page)

B. (15$) On April 1, 1959 > "the local assessor in Champaign observed that ten of

the Cannonball trucks were parked in the parking area of the company's
Champaign depot and warehouse. These ten trucks contained certain
machinery and equipment for delivery to the Urbana plant of Magnavox Company. The
machinery was for a new assembly line being installed in the Magnavox Urbana plant.
Arrangements had been made by Magnavox with the Indianapolis manufacturer to deliver
the new machinery at the Urbana plant on April 2. This schedule had been established
so that the machinery could be taken off the trucks and immediately placed in posi-
tion in the Magnavox factory. The Cannonball trucks delivered the machinery to the
Magnavox plant in accordance with this schedule on April 2.

During the period that the 1959 assessment of personal property was being made
in Champaign, the assessor delivered a tax return to the local office of the Cannon-
ball company. The company filled out the return and mailed it to the local assessor
but did not include the ten trucks. On the basis of information supplied by the
local assessor, the supervisor of assessments added the ten trucks to the Cannonball
assessment but no notice was given to the company. The assessment was duly pub-
lished, however, prior to the meeting of the Board of Review. Cannonball did not

Final Examination in State and Local Taxation (Law 3U9) , Summer Session i960 Page 2

file a complaint with the Board of Review with respect to the assessment, and the
Board proceeded to confirm the assessment submitted by the supervisor of assessments.
The corporation received its 1959 personal property tax bill on May 10, i960, but it
has not made payment. The addition of the ten trucks to the corporation's personal
property assessment resulted in an additional valuation of $50,000 and an additional
tax in the amount of $1,600. The collector has indicated his intention of bringing
suit in County Court to collect the amount of the unpaid taxes. The corporation
admits that the trucks have been fairly valued but objects on the ground that the
trucks are not taxable in Illinois. The corporation requests your advice. Discuss.
(l| pages)

C. (15$) The machinery and equipment on the Cannonball trucks described in (B)
above, which was delivered to Magnavox on April 2, was added by the
assessor to the 1959 assessment of personal property of the Magnavox
Co., an Illinois corporation, at a valuation of $100,000. This figure represented
50$ of the cost of the machinery to Magnavox, and the assessor followed the practice
of consistently valuing personal property at 50$ of its actual market value. The
assessor notified Magnavox of his action and Magnavox appealed the assessment to the
Board of Review on the ground that it did not own the property on April 1 since,
under the terms of the contract of purchase, title to the machinery was to pass to
Magnavox only upon delivery at the Magnavox plant. After a hearing, the Board of
Review affirmed the assessment. Magnavox has received its 1959 property tax bill,
and the additional tax due by reason of the assessment of this machinery is approx-
imately $3>200. The company has not paid the tax bill. The collector has indicated
his intention to bring suit and Magnavox requests your advice. Discuss. ( 1 J pages)

II. (20$) One of the most serious objections to the Illinois property tax is that

the burden of the tax falls primarily upon real property and tangible
personal property, since intangibles are consistently omitted from the
tax rolls. It has been suggested that this problem can be dealt with by imposing a
special transfer tax at the death of the owner upon the value of intangibles which
have been omitted by the decedent from his personal property tax returns during his
lifetime. The special tax would be in addition to the regular inheritance tax and
would be imposed at the rate of 1$ for each year during which the decedent omitted
the intangible property from his personal property tax return, but not to exceed a
rate of 20$. For example, if the decedent had owned the property for a period of
five years prior to his death and had never listed the property for taxation, the
special tax would be imposed at the rate of % upon the date of death value. If the
property had been owned and omitted for a period of seven years, the rate would be
7$; if owned and omitted for ten years, the rate would be 10$; and so forth, up to a
maximum of 20$. The problem of disclosure at death would be resolved inasmuch as
the intangible property would be included in the executor's inventory of property
owned by the decedent which would be filed in the probate court and become a matter
of public record.

Assume that this proposal is to be submitted at the next session of the General
Assembly and that you are requested to render an opinion as to the validity of this
legislation. What is your opinion? Discuss. (2 pages)

III. John Decedent, who held 60$ of the stock of Cannonball Express Co. (see ques-
tion I), died on June 1, i960, a resident of St. Louis, Missouri. He bequeathed
his stock in the Cannonball Express Co. to his son John, a resident of Seattle,

Washington. Several states have assessed death taxes upon the transfer of this
stock. Discuss in each case the validity of the tax. (See page 3)

Final Examination in State and Local Taxation (Law 3^9) > Summer Session i960 Page 3

A. {%) Missouri has assessed an inheritance tax upon the entire value of the

Cannonball stock owned by Decedent. (^ page)

B. (5$>) Iowa has also assessed an inheritance tax upon the entire value of the

Cannonball stock owned by Decedent. (^ page)

C. (9/0) Indiana has assessed an inheritance tax upon 10fo of the value of the

Cannonball stock. This assessment is based on the fact that the office,
depot, and warehouse facilities of the corporation which are located in
Indiana comprise approximately 10$ of the total assets of the corpora-
tion. (§ page)

D. (5$) Washington has assessed an inheritance tax upon John based upon the value

of the stock which he acquired from his father's estate. (^ page)

IV. (10$>) The Iowa statute under which the Cannonball Express Co. (question I) was

organized provided that any corporation organized thereunder should pay
an annual franchise tax as of January 1 of each calendar year, consist-
ing of the sum of the following:

(1) lfo upon its total gross receipts for the prior year; and

. . , , as of January 1

(2) 1/2 of 1% of the total value/of all its assets wherever located.

The franchise tax is payable on February 1 of each year. The statute provides that
failure to pay the tax shall constitute grounds for revocation of the corporate char-
ter. The Cannonball Express Co. has requested your advice as to whether this statute
is validly applicable to their operations. Discuss. (1 page)

V. (1C$>) An Iowa statute authorizes cities and villages to license and regulate

warehouses to assure safe construction and maintenance and to protect
against fire hazards. Pursuant to this statute, the City of Des Moines
has recently adopted an ordinance which provides for annual licensing of all ware-
houses located within the city limits and for periodic inspection of all such facil-
ities. The annual license fee is established at the rate of 10^ per square foot of
warehouse space. The depot and warehouse of the Cannonball Express Co. in Des Moines
(question I) has an area of 10,000 square feet and the annual license fee assessed
under the Des Moines ordinance is $1,000. The corporation seeks your advice as to
whether it should pay this license fee. Discuss, (l page)

FINAL EXAMINATION IN SURETYSHIP (Law 3i+5 )
First Semester 1958-1959 Professor Holt

TIME: THREE HOURS

Give reasons for your conclusions. Due attention should be given
statutes of the types considered in class.

1. (a) C made a contract with PD whereby C was to ship to PD 1000 tons of ccal
a month, and PD was to pay an agreed price within two weeks after the receipt of
each shipment. To induce C to enter into this contract with PD, S had signed

a written guaranty that PD would make the payments stipulated. C shipped the first
two shipcents as agreed, but sent no coal for the third month. If C shipped coal
the fourth month which PD refused to accept, rights of C against S? If PD accepted
the ccal for the fourth month and failed to pay for it, rights of C against S?

(b) Suppose the contract between PD and C required C to make shipments at the
rate of 1000 tons a month for one year, and PD to pay for each month1 s shipment
within two weeks after receipt of the same. C failed to ship the third mcnth, but
PD accepted shipments for each of the remaining nine months and prcmpcly paid the
stipulated price for each shipment but the last, which he faileJ to p<'^y. Rights
of C against S?

2. PD gave a mortgage to S and S-2 to secure them as sureties on certain outstand-
ing notes of his and on notes of his which they might later execute as sureties.

On one outstanding note for $10,000 - Note #1 - T was cosurety with S and S-2.
T paid this note, but before he did so, S, S-2, and R as sureties for I'D executed
another note for $10,000 - Note #2. R paid this second note. PD was insolvent.
On proceedings in equity to foreclose the mortgage, all parties in interest were
before the court. The proceeds of the foreclosure amounted to $10,000. What
disposition?

3. Maker executed and delivered to Payee for the latter' s accommodation his note
in negotiable form for $2000. Payee indorsed in blank and discounted with State
Bank, which had full knowledge of the accommodation character of the note. Before
maturity of the note, State Bank became insolvent. Payee as depositor then had a
credit balance with that Eank to the amount of $21CC. He brought suit in equity
against the receiver of the Eank to compel the latter to offset this balance
against the amount due on the note. Result?

1+. Paul, as payee, indorsed for the accommodation of Michael, as maker, a negoti-
able note due July 1, 1950. Michael delivered the ne'ee so indorsed to Charier and
received from Charles the face amount of the note. Michael made no payments on
tho note. Paul died in March 1956 and after his death his administrator paid to
Charles :'n February 1957 the balance due on the note. At that time action on the
note aga. nst Michael was barred by the statute of limitations, but action against
the administrator of Paul on Paul' s indorsement was not barred. The acministrator
promptly sued Michael for money paid for the use of Michael. How cau such an
action be supported?

5. State X had $150,000 of state funds on deposit with the Northland National
Bank. To secure the State, the bank had pledged with the State $15,000 par value
bonds and had given a bond in the penal sum of $125,000 on which 3 Company was
surety. Upon the insolvency of the bank the claim of the State was satisfied in
; full by a forty per cent dividend declared by the bank's receiver, proceeds frcm
the sale of the pledged bonds, and payment of the balance by S Company. Further
i dividends are to be declared by the receiver of the Northland National Bank.
Rights of S Company?

.

Final Examination in Suretyship, Lav 3I+5, First Semester 1958-1959 Page 2

6. By statute when a surety pays a judgment for a judgment debtor "the judgment
shall not be discharged by such payment, but shall remain in force for ■'"he use
of" the surety. In July 195- S became a surety for a stay of execution on a
judgment recovered by C against D, which was a lien on D' s land. In October 1952
S satisfied the judgment, ana the sheriff made return of execution as follows:

"I return the within writ of execution satisfied in full as
shown by C's receipt for principal and interest."

The return with receipt and release executed by C were duly recorded
in the execution docket. In 1955 -D sold his land to B, a bona fide purchaser
for fair value with no knowledge that S had paid C's judgment. In 195o S
caused execution to be issued on C's judgment against D and levied on the land.
B sued S fcxid the sheriff to enjoin the sale. What result?

7. S Surety Company was bound to County C upon the bond of A, county auditor.

A drew fraudulent warrants for the payment of county funds, payable to the order
of F, indorsed them "F by A," and collected payment from T, county treasurer, who
acted negligently but in good faith. S paid C County, as required by the bond,
the amount of A' s defalcations.

(a) Rights of S?

(b) In addition to the facts stated, assume that by staoite the bend
protected not only County C, but also "any person injured by the wrongful act of
A in his official capacity." Rights of 3?

NAME NO.

FINAL EXAMINATION IN TAXATION OF GRATUITOUS TRANSFERS Lav 252)
First Semester 1959-196: Prcfesscr Young

ALLOWED TE'E: 3 HCURS

::::3v:::'"3

(1) Questions 1 and V are to be answered in xhe space provide! in
these mimeographed materials. Questions II, III, and IV are tc
be answered in the examination book. All mimeographed materials
are to be returned with your examination book. Write your nane
and number on the separate examination bcc>.

(2) Organize your answers carefully. State fully ycur reasons.

(3) Adhere to the indicated space limitations. Each side of a
page in the examination book is to be treated as one page.

(h-) You are no: expected to make any computations involving the
use of the annuity tables included in the income and estate
tax regulations.

(5) Students may have with them the Internal Revenue Code, the Income
Tax Regulations, and the CCH students' tax service. Federal
Taxation - Current Lav and Practice.

Final Examination in Law 352, First Semester 1959-1960 Page 2

I. (10$) In 1940, A purchased certain securities at a cost of $60,000. In 1945,
when the securities were valued at $100,000, A transferred the property
on trust with the provision that the income be paid to W, his wife, for

life, thereafter to A for life if he should survive her, with a gift over to B in

fee. A died December 1, 1959> at which time the securities had a fair market value

of $350,000. Both W and B survived.

(a) What, if anything, is includible in A' s gross estate? Discuss.

(b) The trustee sold the securities on December 30, 1959, for $375,000.
What, if any, gain or loss should be reported on this transaction? Discuss.

Page 2

Final Examination in Law 352, First Semester 1959-1960 Page 3

II. (30%) On January 1, 1959, following surgery for a malignant condition, H

transferred on trust securities having a value of $500,000. Under the
terms of the trust, the income was to be paid to H for life with re-
mainder in fee simple to W, his wife. The accepted actuarial value of W* s remainder
interest at the date of creation of the trust was $^50,000. The trust was created
by H pursuant to a written agreement with W that in consideration of the trust she
would deed to their son John certain Illinois farm lands which she had inherited
in 19^0 from her father. Simultaneously with the creation of the trust by H, W
deeded to John the farm lands consisting of 800 acres and having a value of $2+50,000.
The farm lands had been included in the gross estate of W's father at a total value
of $120,000. On December 15, 1959, H died as a consequence of the malignancy.
At the date of H1 s death, the securities held on trust had a value of $510,000.
On December 16, 1959, John sold the farm lands for a cash consideration of $420,000.
Discuss the various tax consequences of these transactions. (3 pages)

III. (20$) On January 1, 1959, T, age 55, transferred on trust securities having

a value of $250,000. Under the terms of the trust, the income was to
be paid to T's father, age 75, for life, with remainder over to T' s
two children in equal shares. Under the provisions of the trust indenture, T
reserved the power to revoke the trust during his (T's) lifetime, but this power
could be exercised only after the death of his father. T was killed in an airplane
crash on January 1, i960. His father, his wife, and his two children survived.
The income of the trust for the year 1959 which was distributed to T' s father
totalled $15,000. Discuss the various tax consequences of these transactions.
(2 pages)

IV. (20$) On January 1, 1958, F conveyed to his daughter, S, the fee interest in

an apartment building having a value of $200,000 upon the oral under-
standing that S would apply the net income each year to the purchase of
common stocks selected by F. It was agreed that these securities were to be
registered jointly with rights of survivorship in the names of S and F. F died
in an automobile accident on January 1, i960. On that date the apartment building
was valued at $210,000. The net rentals from the building during the period
January 1, 1958, to January 1, i960, totalled $25,000. This sum was invested in
jointly registered common stocks which had a value of $30,000 at F1 s death.
Discuss the various tax consequences of these transactions. (2 pages)

Page 3

Final Examination in Lav 352, First Semester 1959-1960 Page k

V. (20$) Indicate by circling Y (yes),N (no), or U (uncertain) whether the follow-
ing items qualify for the marital deduction in H' s estate. H died
December 1, 1959> and- the family members who survived him were: his
wife, W, age 60; his son, S, age 3^J bis daughter, R, age 30; and his mother, age
80. State briefly in the space allowed the reasons for your conclusions.

Y N U (l) In 1951, H purchased a fully paid-up life insurance policy in the

face amount of $100,000, and designated W as beneficiary. In January
1957, H assigned the policy absolutely to R. R did not change the
designation of W as primary beneficiary but added a secondary beneficiary by
providing that the proceeds should be paid to H' s executor or administrator if W
did not survive H. Upon the death of H, the proceeds were paid to W pursuant to
the terms of the policy.

Y R U (2) In 19^0, H and W acquired as joint tenants by devise from W s

father an apartment building having a value of $100,000. In 19^5 >
H and W sold the apartment for $250,000. The proceeds were invested
in blue chip common stocks which were registered in W* s name. In 1956, W sold
the securities for $^-00,000 and purchased Illinois farm land, taking title in joint
tenancy with H, R, and S. At the date of H' s death, the farm was valued at$46o,0O0.

Page k

Final Examination in Law 352, First Semester 1959-1960 Page 5

Y N U (3) In 1950, H transferred securities on trust with the provision that the
income be paid to R until H1 s death. At H' s death the trustee was
directed to liquidate the trust assets and purchase an annuity for

W. H retained the power to revoke the trust at any time with the consent of W.

This power was not exercised. At H* s death, the trustee promptly liquidated the

corpus and realized $200,000, which was applied to the purchase of an annuity for

W.

(U) How should each of the foregoing transactions in this question (V) be treated
under the Illinois Inheritance Tax? Explain.

Page 5

MIDSEMESTER EXAMINATION IK TORTS A (Law 303)
October 27, 1958 Professor Proehl

TIME: One Hour

Robert, a grown man of 23 with the mentality of a boy of six and a
rheumatic heart, was attending a lodge picnic with his family. During the
course of the afternoon, he was playing about an automobile (not his father's)
and removed the two stones which the owner had placed in front of the rear
wheels of the car, which was parked in a marked parking area on an incline
above the picnic grounds. When he had tired of playing with the stones, he
climbed into the driver's seat of the car and in "pretend-driving", moved the
gear lever to neutral and released the hand brake. The car rolled down the
incline toward the picnic area. Robert became frightened and pressed the
horn, so that the persons in the picnic area dispersed in time, and no one
below was hurt.

When Robert pressed the horn, the pregnant Mrs. N. Ceinte, whose
husband owned the car, and who had been taking a nap in the rear seat of the car,
started up and screamed. This frightened Robert, and he had a heart seizure
and slumped over the wheel unconscious. The car, whose speed never exceeded
fifteen miles per hour, hit a rock, was diverted from its course toward che
river below, and came to a sudden but not violent stop in a large clump of
wild rose bushes, with Mrs. Ceinte seated and bracing herself. Mrs. Ceinte
fainted, but she was promptly revived. A doctor in the crowd examined Mrs.
Ceinte and Robert and determined that neither required attention for bruises,
fractures, etc. Robert was taken, still unconscious, to a hospital, where
he subsequently recovered. Mrs. Ceinte vomited that evening and complained
of a headache. She gave normal birth to a child subsequent to the filing of
her suit against Robert but before the suit came to trial. At the trial she
complained that as a result of the event she had been "nauseated", had felt
"discomfort and some pain 'all over'", and that she had "worried about having
an abnormal baby" during the remainder of her pregnancy as a result of the
shock she suffered. At the trial Robert admitted that he had seen Mrs. Ceinte
asleep in the rear seat when he got into the driver's seat.

1. Discuss the nature of Mrs. Ceinte' s action. What theory or
theories will Mrs. Ceinte' s attorney advance as a basis or bases of liability?
How will Robert' s attorney defend? How do you hold':

2. Does Mr. Ceinte have an action as owner of the car? Discvss.

FINAL EXAMINATION IN TORTS A (la".: 303)
First Semester 1958-1959 Professor Prcehl

TIME: 3 HCUR3

The problems have been stated as simply as possible, but this dees
not mean that the problems themselves are necessarily simple, r.eai each
question at least twice. Then think abcut it. Plan your answer. Know
.■/here you will start, where ycu will go, and where ycu will stop before
ycu begin writing. It is suggested that if ycu spend up to one-third rr
perhaps even as much as one-half of the allotted time thinking each
problem through (and perhaps jotting down seme ideas), the answer can
be written in the balance of the allotted time.

Write complete sentences and write legibly. If you think it neces-
sary to assume any facts beyond those given, be sure to state then.

I. (20 minutes) Plaintiff was a passenger in an automobile driven by defendant,
who lacked two months of being 17 years of age, and was driving an automobile owned
by his uncle. The car was so constructed that when the key was removed, a pin would
be inserted by a spring in a hole in the steering column and would lock th< eel
when the wheel was turned. On the way heme from high school, where the twe were
classmates, defendant drove along a straight read at a speed of approximately 50

tc 65 miles per hour. The defendant pulled out the ignition key and caused the car
to coast along the straightaway with the key removed. The car then came upon a
35- to UO-degree curve in the read. The defendant turned the car _.vto this surve
which caused the steering wheel to lock. Thereafter the car traveled about 125
feet when it hit a tree, at which time it was traveling 35 to k-C miles per hour.
Plaintiff sues for the injuries he suffered. The Illinois Automobile Guest Statute
applies. At the trial defendant testifies that he had "tried the ignition key many
times and had found the lock mechanism did not work'1 and that when he ttrove the car
with the key out the probability of causing injury to his guest "was the least of
my thoughts." Defendant admits, however, that he had never driven around a sharp
curve with the key out of the ignition and that furthermore he had never " gone into
detail about it." What result? Does the result depend in any way upon the a
of the defendant?

II. (20 minutes) Explain fully what Justice Holmes meant when he said in Texas
& Fac. R. R. v. 3ehymer (23 3, Ct. 622, 1903): "What usually is lone may be
evidence c: what ought to be done, but what ought to be done is fixed by a standard
of reasonable prudence, whether it is usually dene or not." Illustrate wi I
brief, hypothetical set of facts.

III. (tC m'.nutes) P, six years of age, walked into the front of a parked auto and
lost an eyp as the result of hitting the share radiator ornament which

beyond the iace of the radiator grill of the automobile. Sectic i 3 of the
California Vehicle Code provides in part. '. . .no person shall sell any ret"
motor vehicle, nor shall any person operate any motor vehicle . . . which is
equipned with a radiator cap or radiator ornament upon the top thereof which 5xt 1 .
or protrudes to the front of the face of the radiator grill of such meter vehicle. :
P sued the defendant (D) motor manufacturer. Argue separately tht ?-.ses for P and
D. ~~ ~ "

IV. (20 minutes) "An interesting question arises when several defendants are sued
and the proof affords an inference of negligence on the part of one of them but
does not afford a basis for saying that it was more probably one of them +har. the
others. Orthodox reasoning would lead to the conclusion that plaintiff has :

met his burden of proof as to any of the defendants and that it was therefore not
incumbent on any of them to come forth with an explanation." The plaintiff in

Final Examination in Torts A, Lav 3C3, First Semester I958-I959 Page 2

Ybarra v. Spangard could therefore not recover under this view without shewing
affirmatively which one of the defendants injured him. "This harshness has been
sought to be justified, however, by pointing out that the alternative seekb to pin
fault, and so liability, upon a group en masse. In a society like ours whi~h
values so highly the worth of the individual, this is a serious matter, .anything
like a finding of guilt or the imposition of punishment or personal civil liability
must be done on an individualized basis or there will be a serious threat to
individual rights."

Do you agree with the stated point of view? Give and explain your reasons
for agreeing or disagreeing. What factors, if any, mitigate the effect of lia-
bility "en masse" as stated here?

V. (30 minutes) Defendant (d) owned a department store. On the first floor en-
trance to the stairway to the basement, D had placed a rubber mat whose eages over-
lapped the first step. Mary, carrying her infant, and accompanied by her father,
stepped on the mat, lost her footing, and was thrown, with the baby in her arms,
down the stairs to a landing where the stairway took a right-angle turn. Mary's
father and others rushed to her assistance. As her father reached the landing,
however, others, rushing up from below, jostled him so that he lost his balance and
fell from the landing on down into the basement, striking Mrs. Hardluck (p) who was
on her v\y up. P sues D department store for her resulting injuries. Argue this
case for E in terms of Palsgraf v. Long Island R. R. Co.

VI. (30 minutes) Discuss what the following fact situations have in common and
whether ycu think res ipsa loquitur is applicable in each case.

(1) 3even-weeks-old infant was scalded by steam and boiling water from e vaporizer,
borrowed by infant' s father from a neighbor who had bought it two years before
from defendant manufacturer's retail outlet.

(2) Thirteen-month -old baby died as the result of chicken bone lodged in respira-
tory system after having eaten can of defendant's soup.

(3) Infant was burned to death in incubator, owned and furnished to hospital by
Illinois Department of Health, which caught fire while being transported in
defendant's ambulance.

{h) Plaintiff was injured when one of roller skates he rented from defendant came
xoose a few minutes after skates were fastened to plaintiff's feet by rink
attendant .

VII. (20 minutes) Plaintiff is the administratrix of Frank, who was a passenger en
a cabin cruiser fishing off New Jersey. Returning in mid-afternoon, the cruiser
became disabled and anchored U00 yards off shore. A storm arose and a Coast Guard
motor lifeboat put out to assist the disabled cruiser and took it in tow.

During the tow, Frank attempted to walk along the deck of th2 cruiser to the
after cabin, holding a handrail as he proceeded. The cruiser heeled sharply, the
handrail broke, and Frank fell into the sea. The lifeboat crew immedia^l" cut the
tov line and made very effort to rescue Frank; however, he drowned before they could
be of assistance to him. Plaintiff claims, in a suit against the United states
under the Federal Tort Claims Act, that negligence of Coast Guard personnel caused
Frank1 s death: first, the lifeboat had a defective reverse gear which delayed it
in reaching Frank after he fell into the sea; second, the life rings in the lifeboat

Final Examination in Torts A, Law 303, First Semester I958-I959 Fage 3

were so secure that they could not immediately he thrown overheard; third, the
crew of the lifeocat was less than the standard and customary Coast Guard comple-
ment. No other evidence pointing to negligence on the part of Coast Guard
personnel was submitted hy P.

The District Court found for the United States on the ground that the
plaintiff had not carried her hurden of proving that the attempted rescue failed,
because of the negligence of the Coast Guard. On appeal hy plaintiff to the
Circuit Court of Appeals, what result?

FINAL EXAMINATION IN TORTS A (LAW 303)
Second Semester 1958-1959

TIME: h HOURS Professor Fleming

I. (20 points) x, who is a veterinarian, specializes in dogs. He maintains a

kennel on what used to be the edge of the city, but is now a
residential area. The dogs often howl at night to the discomfiture
of the neighbors. Y, who is one of the recently arrived neighbors, complains to X
and asks him to move the kennel. This X refuses to do. Y then spreads two stories
around the city: (l) That X is leaving the city and going out of business, and (2)
that X is a Mormon seeking to do business in this overwhelmingly Catholic community.
In fact X is neither planning to leave the city nor to quit his business. X is a
Mormon, and the city is overwhelmingly Catholic. In the ensuing period Y is con-
tinually bothered by the dogs in X' s kennel, and X's business is hurt very substan-
tially by the stories which Y has spread. Discuss the tort problems which are
involved.

II. (25 points) X was without transportation but wished to reach the race track

seven miles away. He conceived the idea of pretending an interest
in buying a used car which, in the course of a road test, he might
drive to the track. X visited Y's used-car lot, where Y gave him a big sales talk
on an $1800 car, including some statements which were definitely false and mislead-
ing. X then asked, and received, permission to test-drive the car for a few
minutes. He promptly drove to the race track, where he parked the car and remained
for two hours. During this time the car was struck by lightning and totally de-
stroyed. X hitched a ride back to town and reported to Y that the car had been
destroyed. Y then locked X in his office and told him he would keep him there until
X made some arrangement to pay for the car. Four hours later X was released
although he had not yet worked out any method of payment. Since then Y has been
calling X at home every evening and threatening him with what he will do if X
does not pay. X's wife often answers the telephone and she has become so nervous
about the whole thing that she has been dismissed from her secretarial job. Discuss
the problems which are involved in this set of facts.

III. (15 points) X began his college career at Podunk where, at the end of his

freshman year, he was placed on probation for alleged involvement
in a panty raid. X denied that he had had anything to do with
the raid and was so incensed at being placed on probation that he transferred to
Siwash. When Y, who was the Registrar at Podunk, received the request for transfer
of credits, he complied, adding, however, an unsolicited note saying that X was on
probation for participating in a riot which resulted in thefts. Y also said that
there was an anonymous note in the Dean's office accusing X of stealing from his
fellow dormitory residents, although this had nothing to do with his having been
placed on probation.

Z, who was employed as a secretary in the Office of Admissions at Siwash,
saw Y's letter. She then informed her boy friend, B, who lived in X's dormitory
at Siwash, that X was a man of "bad moral character" and that the boys had better
watch him. B passed this word around ttte dormitory with the result that X was
shunned by everyone. Finally X found out what was behind the attitude of his
fellow residents, and he now seeks to take legal action. Discuss the problems
which are involved.

'

Final Examination in Law 303, Second Semester 1958-1959 Page 2

IV. (25 points) X was pledged to Y fraternity when he entered college. At the end

of the first semester, a hazing period preceded the initiation.

During this time X, like all the other pledges, was subjected to
a good deal of paddling. Brother Z, who was the paddle -master, never liked X very-
well and on one occasion during the hazing he hit X so hard that X sustained a
slight fracture of the tail hone.

As a grand finale to the hazing X and the other pledges were taken 1C miles
out in the country, left in an open field late at night, and told to find their way
hack to town. Seeing a farmhouse in the distance, the boys started towards it.
As they approached the buildings a dog began to bark, and Farmer C, who had been
having trouble with chicken thieves, came running out of his house brandishing a
shotgun. Without waiting to say anything to the boys, C fired his ehotgun, which
was loaded with rock salt, over their heads. When they turned and ran, he fired at
them, hitting a number of them, including X, but doing no serious damage. When the
boys finally got away from the farm, they found an Illinois state highway leading
to the city and they began to follow it. Unfortunately, that portion of the high-
way was closed to traffic because of road repairs, but the appropriately lighted
sign blocking the road to vehicular traffic had been set up one mile ahead by the
State Highway Personnel. As the boys walked in the dark, X fell into an unguarded
hole in the pavement and broke his ankle.

X' s father was outraged by this series of events and refused to let X be
initiated. Instead he decided to find out what legal action would be available.
Discuss the problems which are involved in this set of facts.

V. (15 points) Y owned and operated the Crash Book Service, a loose-leaf report-

ing service which provided insurance companies, damage appraisers,
and automobile repair shops with data on current costs of auto

repairs. In 195^ X became a full-time distributor for Y in the New England area.

X agreed to plow back his commissions on the theory that he would profit more frcm

renewal commissions as the business grew.

Z published a competing service which was not doing well. Believing that
it would be more economical to buy out Y than to revamp its own service, Z under-
took negotiations toward that end. Y realized that Z' s resources were much greater
than his own and that the alternative to selling out might scon be tough competi-
tion with Z after it revamped its own service. Y therefore agreed to sell to Z
with an agreement that Y would remain as editor and would receive a royalty on all
future sales of books. Z knew that Y had a contract with X which contained the
following clause:

"Crash Book Service will deliver ... to the distributor
manuals necessary to . . . operate . . . subject to limita-
tions necessitated by unforeseeable contingencies."

Prior to the sale Z advised Y to .terminate the contract with X, following which Z
would notify all of X' s customers to deal only with Z's salesmen. X would no
longer have any connection with the business or receive any credit for profits due
on renewals.

Instead of terminating the contract, Y called X and asked him to return his
contract in order that a more favorable one could be drawn. This X did, but Y
then destroyed the contract, and X shortly received word that bis services were
no longer required.

Discuss the tort problems which are involved.

MIDSEMESTEP. EXAMINATION IN TORTS A (Law 303)
April k, 1959 Professor Fleming

I. X owns some woodland and pasture near a State Forest Preserve. Curing the
deer hunting season he often allows friends to hunt on his land. Y is among
those having special permission to do so.

When the 195& deer hunting season opened Y' s nephew, Z, came to visit him.
Both men wanted to go hunting and Y attempted to call X to ask if he might bring
Z along. X' s telephone was out of order, and Y took Z anyway without permission.
While hunting on X' s property Z, who was an inexperienced hunter, saw what he
thought to be a deer and fired, killing the animal. It turned out that what Z
thought to be a deer was, in fact, a prize steer which X1 s daughter, C, was
grooming for an important h-E contest. When X heard the shot he came out of his
house and, on seeing what had happened, was enraged. He came running up to Y and
Z, who were about to apologize, grabbed Z1 s shotgun away from him, and started
after both Y and Z with the gun raised over his head as if to hit them. Y and Z
ran, doubtless concluding that it would be better to send their apologies through
the mail. As Y ran he stepped into an unseen and unguarded posthole which X
was drilling and broke hia leg. Z safely outdistanced X and got out of sight. X
then smashed Z' s shotgun over a stump. As he did so the gun went off, shooting
off one of X1 s toes.

C, who had witnessed the shocking and untimely death of her pet steer from
the window, became despondent, lost all interest in her school and k-B. work,
and was a source of considerable expense to her parents for psychiatric treatment.

What legal problems are involved in this statement of fact, and how would
they be resolved under common- law principles?

II. X is a private university. Y owns a student rooming house near the univer-
sity. During a serious coal strike in January, X is unable to get high grade
coal. As a result it has to burn such poor ccal in its central heating plant
that an enormous amount of soot is caused to descend on the neighborhood. Y' s
rooming house is near the heating plant. The soot renders occupancy of the room-
ing house undesirable and makes the property dirty and dingy. It is anticipated
that the coal strike will last another two weeks. Y comes to you for advice as
to what kind of action, if any, he may bring against X. What is your advice and
why?

HOUR EXAMINATION IN TORTS ,. (Law 303)
November 13, 1959 Professor Proehl

Mr. Brassie and Mr. Putter, who lived across the street from each other,
never got along well. Mr. Putter, who lived on the north side of the street, where
parking was permitted, was blessed with a large and noisy family. Mr. Brassie, who
lived on the south side of the street, where parking was not permitted, had advanced
into middle age without issue, a fact which he looked upon as a blessing when he
viewed the Putter family, but for which he at other times upbraided his wife, whom
he considered responsible for their childless state. The Brassies and the Putters
did not speak to each other, except through the medium of the Putter children, and
this traffic was principally one-way, consisting of severe, and sometimes profane,
injunctions to the Putter children to stay out of the apple trees, to get out of
the flower beds, or just to get out. These tensions smoldered under the surface
for some time, but, as one neighborhood observer put it, the Putters and the
Brassies were inevitably headed for court .

One summer day while Mr. Brassie 's new car was parked on the Putters' side of
the street, Mr. Putter proceeded to mow his lawn with a rotary mower. Thoughtless-
ly but fully intending to do so (and resenting somewhat that the Brassie car was al-
ways parked there), he mowed clock-wise and the cut grass was expelled so that it
struck the side of Mr. Brassie' s car. Since the grass was wet, some stuck to the
side of the car and was noticed by the Brassies when they entered the automobile
that evening. Mr. Brassie swore vehemently, and marched up to the door of the
Putter residence to deliver a protest. Mr. Putter had by this time left to attend
a meeting of the local bird-watching society and was not at home. Mrs. Putter
answered the door. Upon learning that Mr. Putter was not at home, Mr. Brassie sub-
jected Mrs • Putter to a vehement tirade, loud, profane, and somewhat indecent. His
emotion was heightened by noticing for the first time that Mrs. Putter was obviously
pregnant again, and instead of forebearing, he grew more angry and more violent.
Mrs. Putter was standing behind the screen door, feebly trying to interject words
of apology each time that Mr. Brassie drew a new breath. When he had finally ex-
hausted his vocabulary, Mr. Brassie turned on his heel, stomped down the steps, and
out to the car. At that time Mrs. Brassie, who was happy to see him exhaust his
wrath on others, drew her husband's attention to the fact that two of the Putter
children were trespassing in a Brassie apple tree. Thereupon, Mr. Brassie lunged
across the street toward the tree, grasped it firmly in both hands, and shook it.
Young Peter Putter, who was firmly lodged on a branch well out of reach, thought
this great sport and taunted Mr. Brassie for what Peter obviously thought rather
feeble efforts to dislodge him, but Patrick Putter was dislodged, fell, and ran off,
clutching his left wrist. Mr. Brassie then tried to climb the tree, obviously doom-
ed to failure, which only caused Peter to laugh more uproariously. Thereupon Mr.
Brassie went into the house and brought out the Brassie cocker spaniel, which he
tied to the tree, saying (according to Peter), "Nov, you little worthless mutt,
earn your keep for a change. Bite that little so-and-so when he comes down out of
that tree." He and Mrs. Brassie then drove off to dinner and to go bowling. Mr.
Brassie's game was off considerably.

When Peter and Patrick did not show up for supper, the remaining members of
the Putter family were dispatched or. scouting expeditions. Peter was finally
located, still sitting in the Brassie tree, with the cocker at its foot. When
asked why he had not come home, Peter said that he was a prisoner, and that Mr.

Hour Examination in Torts A, November 13, 1959 Page 2

Brassie had told the dog to bite him when he came down. Peter was finally persuad-
ed to come down, and all the dog did was to look quizzically as the children went
home. Patrick was located under the Putter porch, nursing his wrist.

When Mr. Putter returned from his meeting, he found Mrs. Putter, whose
strength had been maintained by sheer force of will until the children were in bed,
prostrate on the living room sofa. She recounted the events of the evening and
said that Mr. Brassie' s visit had especially frightened and upset her, and that
after the children had been put to bed, she felt faint and had to lie down. Mr.
Putter helped his wife to bed and they retired. The next day an X-ray showed
Patrick's wrist to be fractured. A few days later the chemicals in a lawn weed
killer which Mr. Putter had used left a random but permanent pattern of grass
blades in the paint of Brassie' s car.

Discuss the rights of Mr. Brassie, of Peter, of Patrick, and of Mrs. Putter.

Name No.

FINAL EXAMINATION IN TORTS A (LAW 303 )
First Semester 1959-I96O Professor Proehl

TIME: 3 hours

I. Plaintiff (P) entered defendant's (D) self-service store on a busy Saturday
afternoon. P selected a purse and carried it with her as she moved on to look at
some skirts, but then she decided against buying, replaced the purse, and left.
Twenty feet outside the entrance P was overtaken by the Assistant Manager of the
store, who, red-faced and angry, put his hand on P's shoulder, blocked her path,
and ordered her to take off her coat. Being frightened, P complied. The Manager
then said "what about your pockets?" and reached into two pockets on the sides of
her dress . Not finding anything, he took her purse from her hand, pulled things
out of it, peered into it, replaced the things, returned the purse, mumbled some-
thing, and ran back into the store. Passers-by stopped to watch these proceedings,
to the humiliation and distress of P.

P cons\ilts you and you decide to bring an action based on four separate
counts. What are they, and on what facts and law are they based? The jurisdiction
has a "Shoplifters Statute" similar to that of Illinois.

Final Examination in Law 303, First Semester 1959-1960 Page 2

II. P brought an action for damages for interference with use and enjoyment of
his land by reason of D mining company's operation of a coal washer and drier. P
complained of (l) gas, smoke, and fumes from burning "gob" piles (impurities re-
moved from coal) and (2) dust from the stack of the drier. At the trial D showed
(l) the washer was required to remove impurities from coal, (2) D tried to pile
and feather-edge the gob to prevent spontaneous combustion, and put out such fires
as occurred, (3) the mine had been in operation before P built his house and was
the principal industrial employer in the county. P showed (l) gas, fumes, and
smoke from the burning gob piles had blown over P's premises for over 5 years, (2)
dust "was not too bad" except for the past 2 years, since the drier had been put
into operation, (3) the mine was the only one in the county, which was otherwise
agricultural. P failed to allege or prove any lack of care on D's part; and
whether P had ever complained to D of the dust, gas, smoke, and fumes was dis-
puted: P said he had; D said he had not.

Discuss. What result?

Page 2

Final Examination in Lav 303, First Semester 1959-I96O Page 3

III. In Reynolds v. Wilson (Cal., 1958) the California Supreme Court, basing its
decision on the modern view of the infant trespasser doctrine, held for the narents
where a child of 2 years, 3 months, drowned when it fell into a partially--: i.lled
private swimming pool in which dirt and decomposed matter had accumulated . The
father found the child dead, lying face down in the dirty, shallow water, and when
he went into the pool to rescue the child, the bottom was so slippery that he was
unable to carry the child to the steps. Now, in King v. Lennen (Cal., 1959)> a^
intermediate court holds no cause of action is stated where a 1 l/2-year-old boy
drowned in a private swimming pool filled to the normal level with "dirty, stagnant,
and opaque water." The court distinguishes the Reynolds case.

Discuss the law involved. Is the intermediate court right or wrong in
attempting to distinguish the cases?

Page 3

Final Examination in Law 303, First Semester 1959-1960 Page k

Page k

Final Examination in Law 303, First Semester 1959-1960 Page 5

IV. Consider the following letter from the Director of Nurses at the Rockton
Hospital to the local Nurses Professional Registry:

"I have your letter of January 2, concerning the application of Miss Eva
Smith to be registered with you.

"Miss Smith would not be permitted to serve on cases at this hospital if
referred to us by you. When she lived in Rockton some years ago, she did specials
/served as a non-staff nurse of special cases/ here over a period of 3 months,
during which we had 3 vials of demerol /a narcotic requiring prescription/ dis-
appear from our locked medicine cabinet on the floor where she was specialing.
In two instances the loss occurred on the 3-H shift while she was on duty, and
the other loss occurred on the 7-3 shift when she had changed shifts for a few
days. We also had two subsequent incidents, when she charted another medication
on her patients ' chart but was observed having taken demerol .

"I talked to Miss Smith about this loss of demerol at the time and recall
that she had a most unusual and abnormal reaction to my questioning her.

This in no way reflects upon the care which Miss Smith has given patients
in our hospital.

"Sincerely yours,

"(Mrs.) Ellen Queen
"Director of Nurses"

As a result of receiving this letter, the Registry refused to list Miss
Smith and she was unable to obtain employment as a nurse. Miss Smith thereupon
brings an action against Mrs. Queen, who comes to you.

Discuss how you would approach this problem. What other information (facts)
would you want from Mrs. Queen? What is the applicable law? In short, how
would you go about defending this case?

Page 5

Final Examination in Law 303, First Semester 1959-I960 Page

V. (a) In selling a lot, which both vendor and vendee believed to be 150 feet
deep, vendor failed to disclose that the abutting owner disputed the location of the
lot line. A survey showed the lot to be only Ikf feet deep. Does the vendee have
a remedy? Discuss.

(b) Vendor's agent misrepresented the condition of the store building, stating that
the roof did not leak, whereas in heavy rains it did. In fact, vendor knew the roof
leaked, but had withheld the information frcm his agent. The agent, in replying to
vendee's direct question concerning the roof, made his statement without any knowl-
edge of whether it was true or not. Vendee's stock was ruined as a result, for
which he seeks compensation, and he wants also to rescind the sale. What can he
do?

Page 6

Final Examination in Law 303, First Semester 1959-1960 Page 7

(c) Vendor intentionally misrepresents the condition of the house sold to vendee,
who continues to make monthly payments on the purchase price, knowing of the mis-
representation, until he brings his action some months later. Has he waived the
fraud?

(d) Stockbroker A tells customer B that X Company shares are a good buy, believing
this to be true. B demurs. A says he read in the pa-oer this morning that Rocke-
feller is buying in. As a matter of fact,A read a: newsstery about Y Company, which
has a name similar to that of X Company. B buys and xoses his money. Is A liable
to B?

(e) A life insurance investigator asks you about X. You falsely state he is a
light drinker, knowing that he is an alcoholic. X dies in a drunken stupor four
months after policy is issued. (l) Are you liable to the company for its loss?
(2) If you had told the truth about X, if the investigator had written your verba-
tim statement in his notebook, and X had found out, would you have been liable to
X? Would X have alleged slander or libel?

(1)

(2)

FINAL EXAMINATION IN TORTS A (Law 303)
Second Semester 1959-1960 Professor Fleming

TIME: 3 1/2 HOURS

Each of the questions carries a total of 20 points.

I. X owned 200 acres of woodland where the hunting was good. His friend Y sought
and obtained permission from X to hunt thereon. Since Y had never been to the hunt-
ing site, X gave him instructions as to how to get there. Unbeknownst to X some toys
had changed certain signs, with the result that Y actually ended up on the neighbor-
ing woodland of W. Just before leaving for the hunting trip, Y decided to take a
friend, Z, along with him, although it was too late to call X and ask if this would
be all right. When Y and Z reached W's land (which they thought belonged to X), they
found an old jeep which was in running order and which they decided to use to pene-
trate further into the woods. Accordingly, they took the jeep and started off. Along
the way they actually did cross over onto X's land. X had forgotten to tell Y that

a drainage ditch was being dug thereon and, without seeing it, Y drove the jeep into
the ditch. The impact broke the front axle of the jeep, sprained Y' s arm, and cut
Z's head.

Meanwhile W had come out to his land, only to find that his jeep was missing.
Suspecting robbers he grabbed his shotgun and began to follow the path through the
woods. When he came upon Y and Z he was furious, and without giving them a chance to
explain, he pointed the gun at them and said that if they did not follow his orders,
he would shoot. He then forced them to walk back to his cabin, where he locked them
in while he went to find the sheriff.

Identify the tort problems which are involved in this set of facts, and give
your analysis of the law with respect to each.

II. X was an artist of somewhat irregular working habits. He maintained a studio
and living quarters on the sixth floor of an apartment building which fronted along
the river. X conceived the idea of fishing out of his windows, and thereafter he
spent many hours during the day and night dangling a long line from his window into
the river. The neighbors were annoyed by this practice because they felt it en-
couraged children to lean out of the windows, because his lines became entangled in
their windows, and because they found it unpleasant to have a fish suddenly slap
against their windows as it was being hauled in by X. Several of the neighbors
asked X to cease fishing but he ignored them.

Y was a young stenographer who also had an apartment in the building. One
summer evening as she was sitting beside her open window reading, the fishing line,
on which X had hooked a water snake, suddenly dangled through her window and dropped
the snake in her lap. Y was badly frightened and became so nervous that she was not
able to go to work for several days thereafter.

At the time of the incident with Y, W was consulting the landlord about renting
office space on the first floor for an insurance office. He was just ready to sign
the lease when the snake incident took place. After hearing about the fishing prob-
lem, W decided that he would look elsewhere for office space and he left without
signing the lease.

What tort problems are involved in this set of facts, what is your analysis of
the law, and what result do you predict?

i

Final Examination in Torts A (Lav; 303), Second Semester 1959-60 Page 2

III. X was interested in buying some land along a county road at the edge of a city
in southern Illinois. The real estate agent, Y, informed X that the property would
greatly increase in value because Z Company was about to locate a new plant there.

Y knew at the time that no such commitment had been made by Z, although it was con-
sidering the matter. X decided to go for lunch at the local cafe while he pondered
whether to buy the property. While there he happened to sit next to a table where
a State Highway Department engineer was going over some maps with another party. In
the course of their conversation X heard the engineer say that a new state highway
was going to be put in immediately in place of the county road which bordered the
property which X was considering. In fact, the engineer was confused as to the
roads, and he meant to refer to another county road some ten miles away.

After lunch X. in reliance upon the assurance of the real estate agent that Z
was shortly moving to town, and upon the information which he had picked up from the
highway engineer, bought the property. Thereafter Z decided not to locate its
plant in that vicinity and the error in the highway engineer's statement was dis-
covered. X was upset by these developments, and was most unhappy about the fact that
he had paid twice as much as the property was worth. While X was pondering legal
action, oil was discovered on his land and it suddenly became worth ten times as
much as he had paid for it. Nevertheless X felt that he had been deceived by both
the real estate man and the highway engineer.

What tort problems are involved in the above set of facts, and what is your
analysis of the applicable law?

IV. Y was a distinguished biochemist on the faculty of a state university. During
the spring of i960 one of his female assistants was found murdered. There was suf-
ficient circumstantial evidence against Y to bring about his arrest, but the Grand
Jury refused to indict him and he was released. Thereafter he resigned from the
university because of the embarrassment which the publicity had brought to it, and
his resignation was accepted.

X publisher was just bringing out a new popular publication called, "Distin-
guished Men of Science," in which there was a chapter dealing with the life of Y.
Included in the chapter were two paragraphs which read as follows:

"After a distinguished career in the field of biochemistry, Y has recently
been under suspicion in a strange murder case. His young and attractive
assistant was murdered during the past year under circumstances which
pointed the finger of guilt at Dr. Y. Though the evidence before the Grand
Jury has not been made public, it is said that it clearly showed that Dr.
Y was having an affair with the young lady, and that they had on numerous
occasions registered at a motel under assumed names. It is thought that
pressure from Dr. Y's family to end the affair was being brought at the
time of the girl's death. Happily for Dr. Y, the Grand Jury refused to
indict him and he is now free, though the embarrassment occasioned by the
publicity caused him to resign his position.

"It is a distressing thought that even such distinguished men as Dr. Y are
not free from the emotions which trouble lesser human beings, and that
tragedy strikes at both the lowly and the great."

What rights, if any, does Y have against the publisher, what is your analysis
of the legal problems which are involved, and what result do you predict?

Final Examination in Torts A (Law 303), Second Semester 1959-60 Page 3

V. X was a United States soldier in Korea. He was captured by the Chinese and
"brainwashed" so that at the end of the conflict he decided to remain in China. Sub-
sequently he changed his mind and decided to come home. At the time of his return
he was thoroughly interrogated by American intelligence agents, who concluded that
he had defected because of immaturity and that he now genuinely renounced any
Communist inclinations which he might once have had. Nevertheless, as with all such
defectors, his name was in the files of the FBI and a periodic check-up was made
on his activities and whereabouts.

Some time after his return to America, X decided to go into business for him-
self. He leased a filling station from the Y oil company. Z, who also ran a fill-
ing station in the same town, learned of X1 s past record. Z then spread word around
town that X had gone over to the Communists while a soldier in Korea, that he was
now under surveillance by the FBI, and that he had been a traitor to his country.
Z spread this information with the object of ruining X' s business, and improving
his own. When the truck drivers who delivered gas to X heard these stories, they
refused to deliver to him, with the result that Y was unable to fulfill its con-
tract. X was ultimately forced out of business and went bankrupt.

What tort problems does this set of facts raise, what is your analysis of
the law which is involved, and what result do you predict?

■

FINAL EXAMINATION IN TORTS B (Law 304)
Second Semester 1958-1959 Professor Proehl

TIME: 3 Hours

There are seven (7) questions, all of equal value. You may omit one (l) of the
seven, either by omitting to answer one or by "scratching" one answer of seven- A
"scratched" answer will be totally ignored and the grade based on the remaining six.
No extra credit will be given for seven answers.

Read the questions over carefully at least twice. Think before you write, and
write systematically and (for my sake) legibly.

"Policy" explains a lot of law, but not all of it. Avoid subjective analysis
and conclusions.

I. Explain why, at least in some jurisdictions, the term "infant trespasser doc-
trine" is more accurate than "attractive nuisance doctrine." Justify or criticize
the shift which the change in terminology signifies. Illustrate.

II. On appeal from a judgment for P, a woman who had been frightened and had suf-
fered a subsequent nervous breakdown after seeing her husband run over by a negli-
gently driven car, defendant's attorney argued, inter alia, that (l) mental injury
cannot be measured in money; (2) the physical consequences of mental injury are too
remote, and proximate cause cannot be established; (3) recognizing the right to re-
covery in such cases would lead to a vast increase in litigation; (h) there is no
precedent for recovery in such a case; and (5) recognition of this as a cause of
action will lead to fictitious claims. How would you, as attorney for P-appellee,
reply

?

III. The U.S. Supreme Court recently had occasion to decide for the first time the
status of a non-paying guest on board a commercial ship who was injured when he
stumbled on defective flooring, and whether common-law principles governing such a
situation on land ought to be adopted in admiralty. In a unanimous opinion written
by Justice Stewart, the Court concluded, "We hold that the owner of a ship in navi-
gable waters owes to all who are on board for purposes not inimical to his legiti-
mate interests, the duty of exercising reasonable care under the circumstances."

Write the decision which precedes the above closing sentence in the opinion, in
which you consider the adoption of common-law principles concerning the status of
persons on the land or property of another (and the correlative duties of the owner)
to admiralty, leading to the above conclusion. If you disagree with the Court,
write a dissent and a closing sentence to replace the above .

Note : The fact that this case is in admiralty does not take it out of your
reach. Treat the basic question only. In other words, do not put yourself at sea;
but consider the problem strictly as a landlubber.

IV. You are attorney for a woman who is being sued because her dog bit a Fuller
Brush salesman who opened the gate and came up the walk. At the trial the salesman
testified that as he walked along the sidewalk toward the gate, the dog in the en-
closed yard followed him inside of the fence for about 50 feet, barking continuously.
Plaintiff predicates his complaint upon a state "Dog Bite Statute" which makes a dog-
owner liable "to any person lawfully on the premises who is bitten . . . regardless of
the former viciousness of the dog or the owner's knowledge of such viciousness." The
statute specified no defenses . Plaintiff admitted that he had not been asked to
call on defendant, and that he had been canvassing the neighborhood.

1. Discuss all defenses you would argue in behalf of your client, specifying
which you believe would be the most effective and arguing it in detail.

Final Examination in Lav/ 30k, Second Semester 1958-1959 Page 2.

2. How would you argue the case above for the defendant if there were no "Dog
Bite Statute, " if the dog were shown to have barked and snapped at turning automobile
wheels, and on one occasion, five years earlier, while the dog was nursing a litter,
to have bitten a newspaper carrier, but never subsequently to have bitten any of
hundreds of visitors or tradesmen?

V. Plaintiff purchased a wedge of cheese at one of defendant's stores. A few days
later while preparing dinner, P was slicing pieces from the cheese and eating them.
P noticed that one piece did not taste right and then observed a portion of a fly
imbedded in the cheese . She had cut down through the fly and had eaten a part of it.
About ten minutes later P did not feel well, and shortly thereafter became nauseated
and vomited, and was ill for several weeks . P saw a doctor the day after eating the
cheese, and he treated her over a period of five weeks. At the trial the doctor
testified that he "would probably" have called P's illness toxic gastritis, but he
did not testify that the ingestion of the fly caused or could have caused P's ill-
ness. The jury returned a verdict in P's favor, but the trial court directed entry
of judgment for D. You are representing D on appeal by P. Argue the case for D.

VI. Defendant mistakenly delivered five unmarked cases of inflammable cellulose film
to plaintiff's factory. One case was opened to determine the contents, but before
it could be repacked, a typist deliberately touched the material with a lighted cig-
arette, causing an explosion which damaged the factory, for which damage plaintiff
now sues.

1. What is the basis of the plaintiff's case? Of the defense? What is the result?

2. The typist's minor child, 8 years of age, who was visiting her mother at the
plant at the time and was being shown about the plant by her mother (contrary to P
company's standing instructions) when the mishap occurred, was burned and is also
suing D for (a) her own injuries, and (b) her mother's death. What result in each
cause of action?

VII. Defendant built and sold to plaintiff's parents a house. The parents had vis-
ited a "model house" constructed by D, one feature of which was an extra guard rail,
at a height so a child could reach it, along the steps leading to the cellar. This
was pointed out by D's salesman at the time as a desirable safety feature ("one of
many we have incorporated in these houses"), and P's mother agreed that this was an
excellent idea. The parents moved into the house they bought, which lacked such a
guard rail, and a week later P, three years old, fell off the cellar steps and suf-
fered severe head injuries when he landed on the concrete floor . P now sues for
damages .

At the trial it is brought out that (l) plans and specifications of the house,
on file with the Veterans Administration (through whose loan facilities the parents
bought the house) did not include the extra rail; (2) when the father took delivery
of the house, he executed an acknowledgment stating that he found the premises sat-
isfactory except for an unconnected bell wire, a broken window pane, and some
scratches on the walls; (3) the opening between the stairs and the "regular" hand-
rail was 36 inches; (U) after the mishap the father examined 32 other houses in the
subdivision and each had an extra, "child's" rail; (5) the construction superinten-
dent did not know of any house in the subdivision which did not have such a rail;
(6) D's engineer testified that it was up to the carpenter who installed stairs to
put in an extra rail or not, as he chose.

Can P recover? If so, on what basis? If not, why not?

FINAL EXAMINATION IN TORTS B (Law 304)
Summer Session 1959 Professor Proehl

TIME: k HOURS

I. (60 minutes) A statute of the State of Green prohibits deer-hunting except

during an open season from September 15 to October 15 . A and B
go deer-hunting on November 1. C, superintendent of a tract of
timber owned by a lumber company, has made no inspection of the
tract since September 15, believing it wiser to stay out of the woods during the
hunting season. On November 1, C is making a circuit of the timber tract on his
horse for purposes of inspection. A and B come across a deer and wound him slightly,
but the deer runs off. They follow his trail. After several miles of tracing the
deer, they hear a noise in the brush and see a movement of branches and twigs. A
and B both fire at the movement. They rush to the spot and find C, who has dis-
mounted and tied up his horse some distance away, wounded by a bullet in the calf
of his left leg. A and 3 remove C to A' s car to take C to a doctor. B offers to
drive, since A is holding the tourniquet in an attempt to control the bleeding of
C's leg. On the way to town, B drives at speeds of 60 to 70 m.p.h. over rough
roads, loses control, and the car crashes. In the crash, C's right leg is broken
and he sustains a concussion. A and B are seriously injured. All are removed to a
hospital, where C is attended by the doctor of his choice, a man of excellent
reputation .

Both A and B recover, but the doctor, in putting a cast on C* s right leg,
makes it too tight and fails to relieve the pressure over a period of days so that
gangrene sets in. C's vitality is lowered and he contracts pneumonia and dies. An
autopsy reveals that the bullet wound was healing satisfactorily at the time of
death. C's medical bills total $1350 and his funeral costs $800.

C s horse, which was forgotten by C after he had been wounded and of which
A and B never had knowledge, is left tethered in the forest and is attacked by
wolves and destroyed, to the lumber company's damage of $200. C's contract with
the lumber company has over a year to run and it costs the lumber company $500 in
employment agency fees to replace him.

What are the rights and liabilities of the parties, including those of C's
wife as personal representative or administratrix?

II. (40 minutes) A. In Bushnell v. Telluride Power Co. (IU5 F. 2d 950, igkk) D

started a brush firs without securing a permit as required by
statute. He started the fire with due care and kept it under
control until an unexpected wind of hurricane proportions came

along, causing the fire to escape L1 s control and to spread to P' s property. The

trial court granted P' s motion for a directed verdict,

(l) On what basis, if any, nan the judgment of the lower court be affirmed?
(2) On what basis can it be reversed?

B. In Mitchell v. Hotel Berry Co. (171 N.E. 39, 1929) P, a guest, sued D,
hotel owner, for injuries suffered by P in a fire, the injuries alleged to result
from the lack of sufficient exits. D showed that he had complied with the statutory
requirements as to the number of exits required of hotels. At the close of P' s
evidence, D moved for a directed verdict, which the court granted, entering judgment
for D.

(3) Should the trial court's judgment be reversed on appeal? Why?

1

Final Examination in Torts B, Law 3Qh, Sumner Session 1959 Fage 2

C. In Krebs v. Rub sain (lOU A. 83, 1918) D was the owner of an apartment
house. He was under a statutory duty "to keep a proper light turning in the public
hallways near the stairs, upon every floor, between sunset and ten o'clock each
evening." P alleged that because of D1 s negligent failure to perform this duty,
he fell while descending the stairs between sunset and 10 p.m. D showed by testi-
mony of tenants that the light was on shortly before the injury and that it had teen
extinguished by some unauthorized person without the knowledge of D' s janitor. D
moved for a directed verdict.

(h) Should D' s motion be granted? Why?

(5) What is the basic problem in all of these cases? Discuss. Suggest what
you consider the better rule and give your reasons.

III.(U0 minutes) A. P, guest in a car, was bending forward to deposit ashes in an
ashtray vbenthe owner-driver applied his brakes and swung the car
to avoid a collision. P was thrown against the ashtray and lost
the sight of his right eye, allegedly because the ashtray had a

jagged, unfinished edge. P sued the manufacturer of the car, alleging negligence.

D' s motion for judgment notwithstanding the verdict denied. Zahn v. Ford Motor

Co. (l6k F. Supp. 936, Minn., 1958)

B. P, a six-year-old child, walked into a protruding, bullet- shaped radiator
ornament on a parked car. It pierced his eyeball and he lost the eye. P sued the
manufacturer, alleging negligence on the part of the manufacturer. D' s demurrer
was sustained. Hatch v. Ford Motor Co. (329 P. 2d 605, Cal., 1958)

Discuss both cases, distinguishing or reconciling them. Was one of the
decisions "wrong"? Both? Neither? Why?

IV. (kO minutes) A. In Bosley v. Andrews (1U2 A. 2d 263, Pa., 1958) P sought to
recover damages for a heart disability which resulted from her
fright and shock upon being chased, while on her own property, by
a Hereford bull, which was owned by D and which had escaped from
D' s enclosure. The bull did not strike or touch P, and P suffered no physical
injury. However, at the_trial she testified in these words: "I turned around and
looked, and he ^the bull/ was coming at me with his head down, and I started to run,
but I thought I could not get my legs to go and I choked up and I collapsed, and
momentarily, I thought he was going to get me, I could just even feel that he was
on top of me." P' s collie dog intervened and, in the words of Musmanmo, J., "The
bull, then, as dull-witted as his brothers in the shouting arenas of Spain who pur-
sue an innocuous red rag, took after the dog, and Mrs. Bosley was saved from a
leaden-footed torreador's end." P fainted, was revived after some difficulty, and
put to bed. The doctor who was called found her suffering frcm "an attack of
coronary insufficiency and some heart failure." P' s doctor testified that P had
previously suffered from arteriosclerosis (hardening of the arteries) and that,
while the episode with the bull did not cause the coronary attack, it did "consti-
tute the trigger mechanism that brought the symptoms into clinical prominence,
precipitating her first attack of coronary insufficiency leading to subsequent
attacks." The judge allowed the question of property damage done to crops by the
bull to go to the jury, but not the question of her alleged personal injury.

B. In Colla v. Mandella (85 N.W. 2d 3^5, Wis., 1957) P sued for the wrong-
ful death of her husband from heart failure allegedly resulting frcm fright caused
when D' s driverless truck, negligently parked at the top of a hill on a road leading

Page 2

•

Final Examination in Torts B, Law 3C4, Summer Session 1959 Page 3

to P's house, rolled into the side of the house near the windows of the bedroom
where the husband was sleeping. The deceased was 63 years old and had previously
suffered from high blood pressure and a mild heart condition. He was white and
badly shaken after the event, remarking, "Gee, did I get scared. I heard a loud
noise as though the house was shaking and coming down." That night he had diffi-
culty breathing, gradually worsened, and died ten days later. The trial court
denied D1 s motion for summary judgment, and D appeals.

(1) Discuss the basic problem involved in both cases.

(2) What result in each case on appeal?

(3) Can the cases be distinguished on the facts, or is the law as applied
by the respective trial courts not to be reconciled?

V. (60 minutes) P owned 135 acres planted in cotton. At P's request a representa-
tive of D-l (Central Valley Cooperative) inspected the crop,
found insects known as cotton daubers, and advised P to use a spray
containing DDT. P agreed and authorized D-l to make the necessary
arrangements for obtaining the spray and to apply it. D-l instructed its pilot to
do the spraying and delivered to him at the airport 5 new, sealed, 30-gallon drums
of "DDTOL" manufactured by D-2 (Sherwin Williams Co.). The pilot opened the drums,
mixed the contents with water per directions on the drums, and sprayed the crop.
Shortly thereafter crop damage was noticed, plants grew abnormally, and production
was adversely affected. Three experts examined the crop and found that the cotton
was damaged by a plant hormone known as "2, U-D" which is used as a weed-killer and
has an adverse effect on cotton, even when used in extremely small quantities.
Samples taken from the empty drums, as well as two unopened drums, disclosed the
presence of "2, ^-D" in an amount toxic to cotton plants.

Labels on the drums gave directions for mixing and recommendations for use
on various products, such as potatoes, seed alfalfa and clover, onions, and other
truck crops but without mentioning cotton plants. Active ingredients were listed
as "DDT-25^; Xylene -6%; inert ingredients-10#." The label also stated that
"Seller makes no warranty of any kind, express or implied, concerning the use of
this product. Buyer assumes all risks in use or handling, whether in accordance
with directions or not." Burr v. Sherwin Williams Co. (268 P. 2d 10^1, Cal.,
195*0

Check the most nearly correct or the best answer in each case, and give a
reason for your answer if a space is provided therefor. If a question cannot
be characterized as either true or false, because of conflict between jurisdictions
or some other reason, give reason only.

Page 3

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•

■

FINAL EXAMINATION IN TORTS B (LAW 304)
Second Semester I959-I960 Professor Proehl

TIME: h HOURS

I. (90 minutes) On Monday a car negligently driven by Smith collided at an inter-
section with a bus owned by the City Transit Company (CTC), causing the bus to jump
the curb and crash into and knock over a stop sign. The collision occurred without
any negligence on the part of the driver of the bus, and he was unaware that after
his bus had jumped the curb it had knocked over and flattened the stop sign. A state
law made it a criminal offense to "remove, deface, or destroy traffic signs." On
the following Wednesday, while the sign was still down, a car driven by Abel, a
fifteen-year-old boy, proceeded through this intersection in the absence of the stop
sign. He was, moreover, traveling at a rate of speed estimated by witnesses to be
55 m.p.h. in a 25-m.p.h. zone. He collided with a car driven by Baker, which ap-
proached the intersection from Abel' s left, and which had the right-of-way in terms
of the stop sign which "should have been there" (although Abel testified that the
intersection was strange to him), but not in terms of established custom at inter-
sections where no stop signs exist. At the time Baker was traveling within the
speed limit. Witnesses did establish that his car was in the intersection before
the car driven by Abel. Both Baker and his passenger, Carrie, whom, it developed,
Baker had just brought across a state line in violation of the Mann Act (a federal-
law prohibiting the transportation of women across state lines for immoral purposes),
were injured in the collision. On the stand, Carrie had admitted having seen the
car driven by Abel approaching the intersection at a high rate of speed but admitted
that she said nothing to Baker about it. A "guest statute", permitting an action
by a guest against the host driver only upon a showing of "willful snd wanton mis-
conduct" obtained in the jurisdiction.

It was further developed at the trial that Abel did not hold a driver's
license, that his mother owned the car, and that he was on his way downtown at
the specific direction of his mother to purchase groceries. It was further devel-
oped that he saw the Baker car approaching the intersection but there being no
stop sign on his street and, honestly believing that he could beat the Baker car
across the intersection, proceeded, although he admitted he "could have stopped"
and that the Baker car seemed oblivious to his approach.

After the two cars hit, the car of Baker veered off to his left, jumped the
curb, and hit the porch of Doris's house, creating little property damage but a
great deal of noise, with the result that Doris, who was sitting inside, was
frightened, fainted, and struck her head on the corner of her grand piano, suffering
serious head injuries. Doris testified she was frightened because she thought her
five-year-old daughter was playing on the porch.

Discuss the various issues involved and determine all the possibilities of
actions and where liability might rest as among these various parties.

1 D

1 ' '

|B| x-collision

j xxx-flattened stop sign

Final Examination in Torts B (Law 304), Second Semester 1959-I960 Page 2

II. (2 parts - 80 minutes) Mrs. Byrnes was awakened from an afternoon nap by the
smell of smoke and the crackle of flames. She jumped up and ran through heavy
smoke to another room to get her small child and then, half unconscious, stumbled
to the telephone and dialed "0" for Operator. When the operator responded, Mrs.
Byrnes was able to gasp only "Get the fire department . . . 109 Oak Street ..."
She heard the operator reply, "I am sorr-ee. . . We are not allowed to relay such
information. You may reach the fire department by di-yalling Empire 5-3223." Mrs.
Byrnes collapsed, unconscious by the telephone; she and her child were rescued by
firemen called by a neighbor, but not before Mrs. Byrnes and the child had been
severely burned. The house was a total loss.

Mrs. Byrnes and her daughter brought suit against the telephone company. At
the trial, as the facts were reconstructed, it was estimated that the neighbor's
call to the fire department was made 3 to h minutes after Mrs. Byrnes' s attempt to
call, and the City Fire Chief testified that in his view this period was critical,
both as to the flames reaching the front hall, where the telephone was located,
and as to the department's inability to subdue the fire and save the house.

The manager of the local telephone company testified that over a year ago its
operators had been instructed not to relay messages for subscribers "because to
accept the responsibility for doing so might result in garbling, misunderstandings,
and perhaps liability for erroneously transmitted messages." Plaintiff's question
as to whether the manager did not think the company had a duty to relay this call
in these circumstances was objected to by defense counsel, which objection was
sustained. The manager was, however, required to say whether the company's opera-
tors had, previous to the instruction, relayed "emergency calls." He said there
had been "no policy" prior to the prohibition, that it might have happened locally,
but that the prohibitory policy came from the state office and was not initiated
locally. He testified that no public notice had been given concerning the pro-
hibitory instruction given the operators. A witness for the plaintiff testified
that two years ago an operator had been helpful in obtaining a veterinarian for her
ailing dog. Plaintiff herself testified that she had no knowledge that operators
had relayed messages but added that she never thought she would be refused. Plain-
tiff ' s counsel produced a news clipping five years old telling how a local boy's
life had been saved by the "friendly operator" locating a local surgeon at a
dinner party.

1. Why did defense counsel object to the question put to the manager and why
was the objection sustained? Answer this question in the context of a discussion
of the role of judge, jury, and witnesses in a negligence action. (30 minutes)

2. Should the telephone company be held liable to Mrs. Byrnes and the child
for personal injuries and to Mr. Byrnes for the destruction of the house? Write
the "heart" of an opinion as a judge might. (50 minutes)

III. (30 minutes) In his recent book, Traffic Victims: Tort Law and Insurance
(l958)j Dean Green, after a distinguished life of studying negligence law, observes,
"The courts are powerless to reconstruct a rational process for general use. They
have reached a dead end. As a means of giving adequate protection against the
machines of the highway, negligence law has run its course. Something better must
be found." (p. 82)

Depending upon your views, attack or defend this statement; do so with vigor,
spirit, and logic.

Final Examination in Torts B (Law 30U), Second Semester 1959-1960 Page 3

IV. (Uo minutes) Answer briefly and succinctly:

1. What kind of document appears to be the safest one for P's attorney to
insist upon in effecting a settlement with one of several joint tortfeasors?

2. State what appears to you to be the critical elements of an intervening
cause which will be considered to supersede the original actor's negligence.

3. Give an example of "involuntary assumption of risk."

k. Describe briefly the operative effects of res ipsa loquitur.

5- Why is strict liability a better term than absolute liability in cases
where negligence need not be proved?

6. Distinguish contribution and indemnity.

7. Is contribution between tortfeasors a necessary consequence of joint and
several liability? Discuss.

8. Give a brief, "working", definition of proximate or legal cause.

9. What is the critical factor in determining whether the negligence of one
person will be imputed to another?

10. Contrast the doctrine of Ry lands v. Fletcher with the "ultrahazardous
activity" provision of the Restatement of Torts.

FINAL EXAMINATION IN TORTS B (Law 30k)
Summer Session i960 Professor Proehl

TIME: 3 hours

I. (2 hours) A Ford was passing north through an intersection. It was being
driven by a competent, l6-year-old, unlicensed driver (D-l), who
had as passengers an adult (G), not related to D-l, and D-l1 s

younger brother (Y). The car was owned by D-l' s father (F), who had given D-l

permission to use the car. D-l was driving 7 miles in excess of the posted speed

limit of 25 m.p.h.

A Buick was passing south through the intersection when the driver (D-2)
decided to make a left-hand turn in front of the Ford; he thought that, given his
speed (15 miles above the posted limit) and being farther into the intersection
than the Ford, he could make it. He did not signal his turn. He had as his pas-
sengers two pals (P-l and P-2) who had each provided $1, along with D-2, to buy
$3 worth of gas, and they were headed for the Golden Onion. Also in the car was
an adult girl (L), who thought she was being taken home and had on several occasions
asked to be let out after the car had passed her apartment. D-2 had, unknown to
any of his passengers, stolen the car from Owner (0), who had left the keys in
the ignition when he parked to go into a drugstore. The accident happened approxi-
mately three hours afterward.

The Ford and Buick crashed. As a result G, Y, L, and P-l were injured and
both cars severely damaged. In the collision, a wheel came off the stolen car,
rolled over the sidewalk and struck Nancy (N), a girl of five, and knocked her
down, injuring her. N' s mother (M) across the street, heard the crash, saw it,
was frightened that the wheel might strike her (M) and felt faint. She then saw
the wheel headed for her daughter and fainted, suffering bruises and a fractured
skull. She was in her sixth month of pregnancy and her twins T-l and T-2 were
subsequently born weak and deformed, conditions which competent medical testimony
testified, without contradiction, derived from her fall that day. T-l survived and
T-2 died shortly after birth.

A policeman (c), employed by the City, who was supposed to be directing
traffic at the intersection, was in a restaurant drinking coffee at the time of
the accident.

At the trial it was brought out that the wheel on 01 s car came loose because
the impact of the collision had sheared loose an old cotter pin, one half of which
was missing before the accident (an expert testified that one metal break was old
and the other was fresh). 0 testified that he knew nothing of this defect, but he
admitted that the car had not been greased or inspected for over a year, since it
was an old car which he was planning to junk. A mechanic testified that had the
car been greased, the defect would "probably" have been spotted.

At the trial D-2's attorney argued that if D-l had paid proper attention to
driving, he could have stopped in time to avoid hitting the Buick.

The following statutes are in effect in the jurisdiction:

(1) A statute requiring a signal prior to making a turn.

(2) A permissive use statute, such as New York's.

(3) A statute prohibiting the leaving of keys in the ignition of un-

attended cars, such as Illinois' s.
(U) A Wrongful Death Act, such as Illinois' s.

(5) A statute making a city liable for the torts of its employees.

(6) A Guest Statute, such as Illinois' s.

Discuss in a systematic and comprehensive way the possible rights and lia-
bilities involved. A diagram is attached to help you sort out the facts.

Final Examination in Torts 3 (lav 3Ch), Summer Session 196: Page 2

II. (20 minutes) In the above fact situation, suppose that Rescuer '?. ,. a by-

stander, tad rushed to the aid of D-2, who was slumped ever the

wheel. Upon H' s arrival, D-2 recovered consciousness and,
wild-eyed, grabbed a gun from the glove compartment and shot and Injured ?. . D-2
was subsequently adjudged insane and committed to an institution. What are R*s
rights?

III. {h-0 minutes) Plaintiff's father (F) wanted to paint scree bricks alcrrside

his driveway white. He read the directions en a hex c:
Eondex and mixed it with water accordingly. Plaintiff (?)
was helping his father paint (by scraping away de'eris from tricks with a snail
hce). While P was shifting position, his right eye cane in contact with the taint
brush, dripping with Ecndex, which F was holding at his side. P, then 12 years
old, experienced immediate pain. F quickly ran water into t'ne eye. Within five
to seven minutes P was on a hospital operating tatle. But ?' s eye was sc turned
that sight, other than ability to distinguish between light and dark, was per-
manently gone.

F had read the following on the Bondex box: ''Caution: Inasmuch as the
alkalinity of Bondex may te irritating to tender or sensitive skin, it is advisable
to use a paddle for mixing, and to avoid excessive or prolonged contact with the
skin." He also read at another place that the paint contained Portland cement
and calcium oxide. Portland cement is 50 to il--, calcium oxide. Calcium oxide is
lime. The corrosive and caustic effect of lime on the eye is veil known; destruc-
tive, irreversible changes occur within a few minutes. F had never used Bondex
before. He knew the danger of lime, tut did net know that calcium oxide was lime
or what it was, and did not know Portland cement contained lime. He testified that,
if he had known Bondex contained at least %? lime, he either would net nave used
it or would have taken precautions to make absolutely certain that none of it vent
into anyone's eyes. Ee knew seme detergents or scaps might be irritating tc a
tender skin, which was the only significance he attached tc the words ex" caution
on the Eondex box. Cne of p's experts said it was not common knowledge that
calcium oxide was lime. The executive vice-president of Eondex So. (D) testified
he had learned only two weeks prior to the trial that calcium oxide was lime.
There was evidence that, subsequent to the accident, the warning on Eondex was
changed by adding the words, "Care should be taken to avoid contact with the
eyes."

1. What are p's rights against D?

2. F was covered by a comprehensive householder's liability policy. Should
P's attorney have joined F as a defendant or have sued F in preference te D?

3. Suppose it had teen a neighbor's child ['.',), watching F paint, who had
teen injured. What would N1 s rights be?

Final Examination in Torts B, Law 30k, Summer Session i960

DIAGRAM FOR QUESTION I

Page 3

4

i RESTAURANT

BUICK / \
\

>-'/

WHEEL

: D-l

NANCY X.

MOTHER

PARTIES NOT PRESENT:

0 - Owner of Buick
F - Owner of Ford

No.

FINAL EXAMINATION IN TRADE REGULATION (LAW 355)
Second Semester 1958-1959 Professor Carlston

IMPORTANT . You will find a number on the upper right-hand corner of this page. This
will be your examination number. Your grading will be made without knowledge of your
name. A list of the members of this class will be passed around. Place your examina-
tion number in the space opposite your name on the list . DO NOT write your name on
either this question sheet or the examination booklet.

ALWAYS state reasons with your answers. Always take a definite position one way
or another in your answer. If you feel you must qualify it or that the result is only
probable, indicate the reasons for your doubt.

You will have k hours for answering this examination. Take substantial time for
thought before writing. You will be graded on clarity and organization as well as
content .

(30 points) 1. X Company holds a combination patent on a water softener device, con-
sisting of a tank containing a chemical compound through which the water to be soft-
ened passes. The compound is a collection of unpatented ingredients, which when
placed together result in a water softening material having much greater lasting
power than commercial water softeners hitherto used. X Company also holds U.S. reg-
istered trademarks, as follows: (l) "Duracom, " for the chemical compound itself, and
(2) "Duraserv," for a type of service in which the compound is periodically placed in
softener tanks located in customers' houses or places of business. The president of
X Company consults the law firm by which, it is assumed, you are employed. He re-
quests advice on the following method of doing business:

(1) The patent will be licensed for its duration on the basis of a stipulated
royalty for each 100 pounds of the type of softener specified in the patent placed

in the tank for use. The licensee may purchase or acquire the chemical compound from
any source, although the X Company is engaged in its manufacture and sale under the
trademark, "Duracom."

(2) Each patent licensee will be requested to take a trademark license, giving
him the privilege to use the trademark "Duracom" and "Duraserv" in the water soften-
ing business. While he must take such a license in conjunction with his patent
license, the trademark license is terminable at will at any time by either party. The
trademark license authorizes him to sell "Duracom" as a part of a method of doing
business termed "Duraserv." The latter includes the grant of a warranty from X Com-
pany to the customer buying "Duracom" to the effect that each 100 pounds of "Duracom"
will satisfactorily soften a certain number of gallons of water and that the licensee
of "Duraserv" will at all times keep the customer's softening tank adequately serviced,
provided the customer gives him access thereto.

Each such trademark licensee will be privileged to sell any other type of water
softener, including softeners of the same specifications as those set forth in the
patent, acquired from any competitor of X Company, but his price for "Duracom" must
always match his price for such other water softener. He must, however, limit his
service function, i.e., the periodic filling of customers' tanks on a standing order
basis, to "Duraserv."

You are asked by your firm to prepare an opinion on the legality of the above
proposed practices under the antitrust laws . What is your opinion and why?

(30 points) 2. A Chicago company, engaged in the rental of trailers for use in

transporting goods by private passenger automobiles, submits to the law firm, by which,

it is assumed, you are employed, a proposed plan or venture (l) for advice as to its

legality under the antitrust laws and suggestions as to such modifications as the law

Final Examination in Law 355, Second Semester 1958-1959 Page 2.

may render advisable, and (2) for taking such steps as may be advisable under Federal
law before the plan is put into operation. The proposed plan is turned over to you
for study and report. What is your advice with respect to the plan, as hereinbelow
set forth:

There is to be established a national association of companies engaged in such
trailer rentals, which will be called the U.S. Speed-Safe Trailer Rental Association.
The headquarters of the association will be located in Chicago. Each member will re-
ceive a license to use the name of the association in his business and will be assign-
ed a specific territory for his operations. Whenever he rents a trailer for transport-
ing goods outside his area, the lessee will agree to deliver it, when he has finished
with its use, to the association member in such territory. Such member will then give
such trailer priority in any leases of the trailer which will be in the return direc-
tion towards its owner. If received by some other member, the latter will then en-
deavor to route it towards its owner and so on until the trailer is finally returned
to its owner.

A standard list of trailer rental fees is furnished each licensee but he is free
to charge such gross rentals on the association business as will be competitive with
other trailer rental companies. A standard basis of division of rentals on trailers
received through the association and owned by others is also furnished licensees.
Licensees must once a month report to the association all rentals made in business of
association origin, price charged and sums remitted to association members.

There will be two classes of members. Class A members will own ten or more
trailers and Class B will own less . Class A members will be entitled to vote in the
association's annual meetings.

The association will employ legal counsel to prepare standard form lease con-
tracts, to collect on behalf of association members unpaid trailer rental bills and
to represent it before legislative bodies .

No member may be connected with any other trailer rental association and each
member shall be the sole association member in his territory.

(20 points) 3- The Brown Furniture Distributing Company, generally known as 'Brown's,"
advertises itself as a furniture wholesaler. In fact, it receives large furniture
orders from retailers and places them with furniture manufacturers . Any such order is
required to be accompanied with cash equal to the manufacturer's price to wholesalers
of the furniture, plus l/2$ commission for Brown's. Pursuant to trade custom, the
furniture is shipped directly to the retailer by the manufacturer. Brown's makes its
profit because it has only paper work to perform and provides no storage, repackaging
or delivery services. A protest is filed with the FTC. Discuss the legality of this
practice .

(20 points) h. Plaintiff is engaged in the business of selling cold tablets under

the name of Way," with the "h" appearing above "Way." These are sold in white boxes,
which bear the said name and also a statement of the four beneficial effects alleged
to flow from their use. The pills are pink ir color, grooved down the center and
are hexagonal in shape .

The defendant is also selling cold tablets under the name "7-Way, " with the "7"
appearing next to the word "Way." These are sold in bottles, which bear the said
name and a list of seven assertedly valuable ingredients. The pills are salmon in
color, grooved down the center and are octagonal in shape.

Plaintiff introduced evidence that purchasers thought defendant's product to be
an improvement over the plaintiff's product and to emanate from the plaintiff.

What decree should issue and why?

NO.

FINAL EXAMINATION IN TRADE REGULATION (Law 355)
First Semester 1959-1960 Professor Carlston

IMPORTANT: You will find a number in the upper right-hand corner of this page.
This will he your examination number. Your grading will be made without
knowledge of your name. A list of the members of this class will be passed
around. Place your examination number in the space opposite your name on the
list. DO NOT write your name on either this question sheet or the examination
booklet.

ALWAYS state reasons for your answers. Always take a definite position one way or
another in your answer. If you feel you must qualify it or that the result
is only probable, indicate the reasons for your doubt.

You will have 3 l/2 HOURS for answering this examination. Take substantial time
for thought before writing. You will be graded on clarity and organization as
well as content.

(35 points) 1. Exco manufactures about 35% °f the juke boxes, i.e., coin-operated
phonographs, in the country. Its subsidiary, Juko, purchases
about four-fifths of Exco' s production, which it sold or leased
under the trade mark "Juko" largely to restaurants, taverns, and the like. It does
so under a contract to purchase its entire requirements of juke boxes from Exco.
Exco acquired the stock of Fonoco, a phonograph disc recording company, which manu-
factures about 8% of the records sold in the country. Fonoco has a very strong
position in the gospel type of music, manufacturing about 1+0% of such records. This
type of music is particularly popular in the Southeastern states.

Juko advertised that any of its lessees desiring to purchase "Juko" juke
boxes under lease to such lessees, could so purchase them under an arrangement where-
by Fonoco would remit to Juko, to apply on the purchase price, in respect of all
records purchased by such lessees from Fonoco, the difference between the list
retail price of Fonoco' s records and the price at which they were available to the
public at the nearest record discount house selling to the public. The advertise-
ment stated that leases were available to any person with good credit standing.
Within one year after the above arrangement went into effect, Juko's leases of
"Juko" juke boxes in the Southeastern states increased from about 33% to about 1+5%
of the market. Fonoco' s sales of records increased from about 8% to 9%> its sales
of gospel records increased to over 50% of the national market, and its sales of
gospel records in the Southeastern states increased to about 65%. Discuss the
legality of:

(1) Juko's entire requirements contract with Exco.

(2) Exco' s acquisition of the stock of Fonoco, in the light of all the
pertinent facts of the case.

(3) Juko's and Fonoco' s sales policies.

(25 points) 2. Gageco manufactured a patented gage for measuring metal strain.
; This gage was usually incorporated in scientific apparatus of

various types but it could also be used by itself. Gageco licensed
aircraft manufacturers to make and use its patented gage for 10% of their annual
requirements. Any additional portion of their requirements of the patented gage
had to be purchased from Gageco. The licensees could otherwise purchase gages from
anyone. The licensee could not make any scientific apparatus employing the
patented gage. Gageco licensed manufacturers of scientific apparatus to make, and
include in such apparatus, its patented gage. Any such apparatus could be sold in
any field of commerce except to aircraft manufacturers. Each such item of appara-

Final Examination in Law 355> First Semester 1959-&C Page 2

tus and each patented gage therein was required to have affixed to It a notice read-
ing: "U.S. P. No. 3,000, CCO. Not licensed for use in aircraft industry." C-ageco, in
its own sales of scientific apparatus containing its patented gage and also in its
own sales of patented gages, affixed the same notice to such items. The phrase
"Not licensed for use in the aircraft industry" was omitted in sales to that indus-
try, and the phrase "Licensed for use only in the aircraft industry" was substi-.u-ed.

The aircraft manufacturers are the principal users of such gages and appar-
atus. Gageco sold to them all of the scientific apparatus employing the pst-nted
gage and all gages employing its patent, except for their own manufacture of
patented gages. C-ageco made about 10$ of the gages used for measuring metal
strains.

Discuss the legality of the above arrangements.

(15 peints) 3- (a) Discuss the validity of the trade mark "Juko," mentioned in

Question 1 above, (b) The directors of Exco, mentioned in Question
1 above, are thinking of establishing the trade mark "Juko" through-
out its business, i.e., for all products manufactured by its group of companies.
Discuss how this might be done.

(25 points) h. The directors of Exco, mentioned in Question 1 above, decided that
their corporate aggregate is too static for growth purposes and
that they must enter some type of business which will enable a mere
rapid increase in their capital assets. They considered buying Acco, an electronics
concern making principally tape recorders and engaged also in government contract
research, which possessed a good research and engineering staff. The price proved
to be too high and they decided instead to hire the principal engineers ana research
personnel of Acco and to enter the tape recording business and seme other phase of
the electronics industry. Each such former employee of Acco had agreed in writing
not to divulge to others any trade secrets learned while in Acco' s employ and not
to enter into the employment of any of its competitors for a year after any ter-
mination of their employment with Acco. Any person leaving Acco' s employ was en-
titled to a terminal payment of a sum equal to three months' pay. Each such former
employee of Acco accepted this terminal payment on leaving Acco' s employ. Acco
was not notified by anyone that they were entering the Exec group of corporations
when they left Acco' s employ.

Each such employee entered the employ of Foncco. Neither Fcnoco or any one
else in the Exco group had any notice of the facts in the preceding paragraph.

The said research and engineering personnel were made a work team to design
a new tape recorder. This they did, in part utilizing designs that the engineers
had been working up during their former employ by Acco. They also utilized for
this purpose knowledge and skill in a certain area of thermoplastic recording in
which Acco had been working but in which no product had as yet been put on the
market by Acco. Fonoco put its tape recorder on the market three weeks after
Acco' s new model of the same reached the market. It was remarkably similar to it
in appearance and duplicated or exceeded its special advantages in use. Seme
months later Fonoco was the first to introduce a commercial thermoplastic recording
device.

Acco seeks your advice as attorney as to it L rights. It wishes to know

all possible remedies available to it, either in equity or common law,
theories of such causes of action, and its prospects of successful recovery there-
in. How would you adviee them?

FINAL EXAMINATION IN TRIALS AND APPEALS (Law 335)
Second Semester 1958-1959 Professor Stone

TIME: 3 1/2 hours

Begin each answer with a statement of your decision or your conclusions. Discuss
all points and issues involved, and give reasons fully, but concisely. If you think
that further facts have to be assumed, assume them, and say what they are. If you
think that ambiguities exist, point them out and resolve them in some stated way, or
deal with the question on the basis of alternative resolutions. LARGE CREDIT WILL BE
GIVEN FOR CLARITY, BREVITY, COHERENT ORGANIZATION, AND GOOD ENGLISH PROSE.

Please do not write any part of your answer on the first or the second page of your
examination book; start your answer on page 3.

I. (30 points) James Sullivan and his wife, Jean, were injured in a collision be-

tween the Yellow cab in which they were riding and an automobile
driven by George Gist. The cab driver was Paul Rector. Rector
brought an action for personal injuries against Gist, and the Sullivans brought a
similar action against Gist and Yellow. The actions were consolidated by the trial
court. Gist cross-claimed against Yellow for personal injuries, and also filed a
third-party complaint asserting that if any of the plaintiffs had been injured, it
was by reason of Rector' s negligence, and demanding judgment against Rector and
Yellow in the amount of any judgment rendered against him in favor of the Sullivan
plaintiffs.

1) Suppose the case is before an Illinois circuit court. Can the
party or parties adversely affected obtain review of the rulings described below
before the case is tried? Explore all possibilities, and give reasons for your
conclusion in relation to each:

a) Upon Gist's refusal to comply with a court order that he
submit to a physical examination, the judge dismissed his cross-
claim.

b) The judge denied Gist's motion that the Sullivan plain-
tiffs be ordered to submit to a physical examination, and granted
his motion that Rector be ordered to submit to a physical
examination.

c) The judge granted summary judgment in favor of Yellow on
the Sullivans' claim, Gist's cross-claim, and Gist's third-party
claim. (The basis of the ruling was that Yellow was not vicariously
liable for Rector's acts since he had fraudulently obtained the

cab from the Yellow garage, and was pocketing fares collected.)

2) Suppose the case is before a United States district court. How,
if at all, would your answer in each instance differ?

II. (kO points) In an action for personal injuries resulting from the collision of
automobiles driven and owned by plaintiff and defendant respectively, the sole
factual issue in relation to negligence and contributory negligence was whether
plaintiff or defendant had entered the intersection against the red light. P and D
were the only witnesses to the collision. P' s case as to negligence consisted sole-
ly of his own testimony that D had entered the intersection against the red light.
At the close of P' s case, D moved for a directed verdict in his favor, which motion
was denied. D offered no evidence. Both parties then made motions for directed
verdicts, but the judge reserved rulings thereon.

a) The jury returned a general verdict for P and, in response to
a special interrogatory, stated that P had not entered the intersection against the
red light. The judge then granted D' s timely motions for judgment and for a new
trial. P appeals. What issues are presented to the reviewing court and how should
they be resolved?

'

Final Examination in Law 335, Second Semester 1958-1959 Page 2

b) The jury returned a general verdict for D and, in response to

a special interrogatory, stated that P had not entered the intersection against the
red light. The judge then denied P' s timely motions for judgment and for a new
trial. P appeals. What issues are presented to the reviewing court and how should
they be resolved?

c) Facts as in b) above. The reviewing court was the Illinois
Appellate Court. Suppose that it held that the trial judge's ruling on the motion
for judgment was correct, but reversed and remanded the case with instructions to
grant the motion for a new trial. Suppose further that you are D' s attorney and
that your client has suffered retroactive amnesia and can remember nothing about
the collision. What do you do now? Why? With what probable consequences?

III. (30 points) The Sino Importing Company, a California corporation with office

in San Francisco, imports various items from the Orient for dis-
tribution in the United States. Among the items imported last
year were some straw sampan hats for children, which hats were manufactured in the
Portuguese colony of Macao by a Portuguese corporation, the Lisbon Manufacturing
Company. Sino sold some of these hats to Michael McMahan, doing business as the
Chinese Trading Company, a sole proprietorship, at XX Grant Street, San Francisco.
Mr. and Mrs. James Smith, residents of Urbana, purchased two of these hats from the
McMahan store, while visiting San Francisco recently. Upon their return to Urbana,
they presented the hats as peace offerings to their small children, who had been
left behind. The first time Junior Smith wore his hat in bright sunlight, it
ignited, and burned him severely. An examination of the other hat revealed that a
highly inflammable chemical with a very low ignition point had been used to color
and preserve the straw.

a) Suit on behalf of Junior Smith was commenced against Sino,
Lisbon, and McMahan, in the United States District Court for the Eastern District

of Illinois, located in Danville. Process was personally served on Sino' s president
in his office in San Francisco. Process was served upon Mrs. Michael McMahan, who
acts as buyer for her husband's business, while she was making purchases on Twenty-
second Street in Chicago. Process was also served on Senor Trajo, a director of
Lisbon, when he visited Chicago to raise funds for a mission school in which he had
a personal interest.

None of the three defendants has any office or resident personnel in Illinois;
Lisbon has none in this country. Each defendant moved to dismiss for lack of
jurisdiction over the person. What issues are raised by each motion, and what rul-
ing should be made thereon? (You may assume that the court has jurisdiction over
the subject matter, and that venue is proper.)

b) Assume that suit was filed in the local Circuit Court instead
and that personal service on Sino and McMahan was had within the state. Count I
of the complaint was based on a willful and wanton theory; Count II on ordinary
negligence; Count III on breach of warranty. Plaintiff proved purchase of the hats,
the ignition of the one Junior was wearing, the chemical analysis of the other one,
and absence of contributory negligence. The defendants introduced no evidence but
moved for directed verdicts on all counts; the judge reserved rulings on the motions.
The jury returned general verdicts for the plaintiff against Sino and McMahan.

What relief might each defendant request in his post-trial motion, and what
grounds might each assert in support of each request?

■

'

Final Examination in Law 335, Second Semester 1958-1959 Page 3

TITLE 28, UNITED STATES CODE

§ 1291. Final decisions of district courts

The courts of appeals shall have jurisdiction of appeals from all
final decisions of the district courts of the United States, the United States
District Court for the District of the Canal Zone, the District Court of Guam, and
the District Court of the Virgin Islands, except where a direct review may be had
in the Supreme Court.

§ 1292. Interlocutory decisions

(a) The courts of appeals shall have jurisdiction of appeals from:

(1) Interlocutory orders of the district courts of the United
States, the United States District Court for the District of the Canal Zone, the
District Court of Guam, and the District Court of the Virgin Islands, or of the
judges thereof, granting, continuing, modifying, refusing or dissolving injunctions,
or refusing to dissolve or modify injunctions, except where a direct review may be
had in the Supreme Court;

(2) Interlocutory orders appointing receivers, or refusing orders
to wind up receiverships or to take steps to accomplish the purposes thereof, such
as directing sales or other disposals of property;

(3) Interlocutory decrees of such district courts or the judges
thereof determining the rights and liabilities of the parties to admiralty cases
in which appeals from final decrees are allowed;

(k) Judgments in civil actions for patent infringement which are
final except for accounting.

(b) When a district judge, in making in a civil action an order not other-
wise appealable under this section, shall be of the opinion that such order involves
a controlling question of law as to which there is substantial ground for difference
of opinion and that an immediate appeal from the order may materially advance the
ultimate termination of the litigation, he shall so state in writing in such order.
The Court of Appeals may thereupon, in its discretion, permit an appeal to be taken
from such order, if application is made to it within ten days after the entry of
the order: Provided, however, That application for an appeal hereunder shall not
stay proceedings in the district court unless the district judge or the Court of
Appeals or a judge thereof shall so order.

■

FINAL EXAMINATION IN TRIALS AND APPEALS (Law 335)
Second Semester I959-I960 Professor Stone

TIME: 3 HOURS

Begin each answer with a statement of your decision or your conclusions.
Discuss all points and issues involved, and give reasons fully, but con-
cisely. If you think that you must make assumptions as to fact or law,
state what they are. LARGE CREDIT WILL BE GIVEN FOR BREVITY, CLARITY,
COHERENT ORGANIZATION, AND GOOD ENGLISH PROSE.

I. (90 minutes) (Do not assume uncritically that any of the judicial decisions

described in the question is necessarily correct.)

Jones lent $20,000 to Bigg Company. The loan was negotiated by J. B. Bigg,
president and secretary of Bigg Company, a resident of Florida. The borrowed funds
went into the corporate treasury and were used for corporate purposes. Jones received
a one-year promissory note, signed on behalf of the company by J. B. Bigg. Payment
on the note was due January 21, i960. The note contained a confession-of- judgment
clause. No payment on the note having been made on the due date, Jones instituted
proceedings in an Illinois circuit court of proper venue to have a judgment by con-
fession entered against Bigg Company. Judgment by confession was entered. The Bigg
Company filed a motion to open the judgment; the motion was made promptly and was
accompanied by an affidavit that disclosed a prima facie defense on the merits. The
motion was granted on January 25, i960. Jones then amended his complaint to add
Counts II and III; Count II demanded $20,000 from Bigg Company, and Count III de-
manded $20,000 from J. B. Bigg; each was based on the theory that the defendant
received $20,000 from plaintiff and would be unjustly enriched if allowed to retain
the benefit without repaying plaintiff. Count III contained allegations that J. B.
Bigg deliberately deceived plaintiff as to Bigg's authority to contract on behalf
of the Bigg Company. All of the foregoing occurred in Illinois.

(a) Bigg was served personally in Florida. Bigg moved to quash service on
the ground that Bigg was not an Illinoisan, that the only business he has ever
transacted in Illinois was in a representative rather than in an individual capacity,
and that the complaint did not allege commission of a tortious act by him in that
damages were asked on a qua si- contractual theory. What decision? Why?

(b) After denial of his motion to quash service, Bigg filed a motion demand-
ing a jury trial. What decision? Why?

(c) Upon denial of his motion to quash service of process, Bigg's attorney
requested and obtained from the trial court an express finding that there was no
just reason for delaying enforcement or appeal; he thereupon appealed to the Supreme
Court. Plaintiff moved to dismiss the appeal or transfer it to the Appellate Court.
What decision? Why? If you believe that the appeal should be transferred, what
disposition should the Appellate Court make of the motion to dismiss.-' Why?

(d) The appeal was dismissed. The case went to trial. There was proof to
support, and proof to defeat a recovery against Bigg on a theory of deceit, but
none to support recovery on a quasi-contractual theory. Plaintiff submitted in-
structions on both theories; Bigg objected to all of them and moved for a directed
verdict. What decision? Why?

(e) The jury returned a verdict against J. B. Bigg in the amount of $10,000
and against Bigg Company in the amount of $11,000, making a total recovery of $21,000,
the principal amount of the note plus a year's interest. If you were Bigg Company's

Final Examination in Trials and Appeals (Law 335), Second Semester 1959-60 Page 2

attorney, what, if anything, would you do when the jury's verdict is announced?
Why?

What, if you were Bigg's attorney?

What, if you were plaintiff's attorney?

(f ) Assume that all points were preserved by appropriate and timely post-
trial motions. Bigg Company appeals. One of the grounds of appeal is that there
was no evidence to support recovery against the company on the note because a
resolution of the Board of Directors had prohibited J. B. Bigg from borrowing money
on behalf of the corporation without specific authorization from the Board, and no
such authorization had been given. The record contains undisputed testimony evi-
dence to this effect. Suppose that the substantive law exonerates the corporation
from liability under these circumstances. Suppose further that no error was com-
mitted in relation to instructions or evidence on this subject. Has Bigg Company
stated a sufficient ground for reversal of the judgment against it?

II. (*+5 minutes) (Suppose that Green and Harno are states of the United States

and have legislation on procedure that ie indistinguishable
from the Illinois Civil Practice Act.)

John X. Cutive, a corporate officer who formerly lived in the State of Harno,
obtained a new position with Mom's Apple Pie Corporation (hereinafter "MAP"), a
corporation organized and doing business in the State of Green. He learned about
the position through, and was assisted in obtaining it by, the Organization Man's
Placement Bureau, a Harno partnership consisting of Slick, a Harno resident, and
Craft, who lives in New Jersey. The Bureau's efforts on behalf of Cutive consisted
entirely of correspondence and telephone calls.

Cutive 's contract with the Bureau provides that if the Bureau should place him
in a position with the salary he now earns from MAP, he is to assign to the Bureau
as compensation for its services the first $200 of his salary each month until a
total fee of $12,000 is paid. The contract was signed in Harno. Cutive has since
moved to Green to assume his new position.

MAP has deducted $200 from each of Cutive' s first two salary checks, even
though he has not executed any assignment. The Bureau has sent a photographic
copy of Cutive' s contract to MAP. MAP has informed Cutive that it considers that
the contract operates as an assignment and that it will continue to make such de-
ductions and forward the amounts thereof to the Bureau.

Cutive wants to avoid paying the Bureau what he now considers to be an ex-
orbitant fee. He consults you, a Green lawyer. Your preliminary investigation
indicates that possibly the contract between your client and the Bureau is unen-
forceable under Harno law and, under Green law, does not bind MAP, but that the
Bureau would be an indispensable party to any litigation between Cutive and MAP.
Outline a program of action to prctect and advance the interests of your client.
Consider and evaluate all litigational possibilities and the procedural problems
concerned with each.

III. (U5 minutes) In an action for personal injuries resulting from the collision

of automobiles driven and owned by plaintiff and defendant
respectively, the sole factual issue in relation to negligence
and contributory negligence was whether plaintiff or defendant had entered the
intersection against the red light. P and D were the only witnesses to the

Final Examination in Trials and Appeals (Law 335 ), Second Semester 1959-60 Page 3

collision. P's case as to negligence consisted solely of his own testimony that
he had entered the intersection with the green light. At the close of P's case, D
moved for a directed verdict; the motion was denied. D offered no evidence. Both
parties then made motions for directed verdicts, but the judge reserved rulings
thereon.

(a) The jury returned a general verdict for P and, in response to the sole
special interrogatory, stated that P had not entered the intersection against the
red light. The judge then granted D1 s timely motions for judgment and for a new
trial. P appeals. What issues are presented to the reviewing court, and how should
they be resolved?

(b) Same facts as in (a), except that in response to the sole special inter-
rogatory, the jury responded that D had not entered the intersection against the red
light. On P's appeal, what issues are presented to the reviewing court, and how
should they be resolved?

y w y y

Excerpts from the Judicial Code (Revised Title 28, U.S. Code)
§ 1332. Diversity of citizenship; amount in controversy

(a) The district courts shall have original jurisdiction of all civil actions
where the matter in controversy exceeds the sum or value of $10,000, exclusive of
interest and cost, and is between --

(1) citizens of different States;

§1391- Venue generally

(a) A civil action wherein jurisdiction is founded only on diversity of
citizenship may, except as otherwise provided by law, be brought only in the judi-
cial district where all plaintiffs or all defendants reside. . . .

§ lUoU. Change of venue

(a) For the convenience of parties and witnesses, in the interest of justice,
a district court may transfer any civil action to any other district or division
where it might have been brought. . . .

§ lUUl. Actions removable generally

(a) ... any civil action brought in a State court of which the district
courts of the United States have original jurisdiction, may be removed by the
defendant or the defendants, to the district court of the United States for the
district and division embracing the place where such action is pending. . . .

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