Does the clause making the policy effective only after a medical examination violate public policy? What other basis for a lawsuit might Martha have against the insurance company? Explain.

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The Case of the Customer Who Died to Soon

 

Facts:

On October 26, a Wednesday Country Life Insurance agent went to the house of Martha and Gary Andersen. He persuaded the Andersens to buy a life insurance policy and accepted a check for $1,600. On his way out the door, he gave the Andersens a “conditional receipt for medical policy,” dated that day. The form stated that the Andersens would have a valid life insurance policy with Wednesday Country Life, effective October 26, but only when all conditions were met. The most important of these conditions was that the Wednesday Country Life home office accept the Andersens as medical risks after the company scheduled a medical examination. The Andersens were pleased with the new policy and glad that it was effective that same day.

Gary died in a car accident three weeks later. Wednesday Country Life declined the Andersens as medical risks and refused to issue a policy. Martha Andersen sued. Wednesday Country Life pointed out that medical approval was a condition to being covered. In other words, the company argued that the policy would be effective as of October 26, but only if it later decided to make the policy effective. It had not made that decision as of the date of Gary’s death.

At Trial

Plaintiff argued that the policy was a scam. The so called “conditional receipt for medical policy” is designed to trick customers and then steal their money. The company leads people to believe they are covered as of the day they write the check. But they aren’t covered until much later, when the insurer gets around to deciding the applicant’s medical status.

The company gets the customer’s money right away and gives nothing in exchange. If the company, after taking its time, decides the applicant is not medically fit, it returns the money, having used it for weeks or even months to earn interest. If, on the other hand, the insurance company decides the applicant is a good bet, it then issues the policy effective for weeks or months in the past, when coverage is of no use. No one can die retroactively. The company is being paid for a period during which it had no risk.

Defendant, Wednesday Country Life, argued that it would be impracticable for Wednesday Country Life to issue life insurance policies without doing a medical check. That is the road to bankruptcy and would mean that no one could obtain this valuable coverage. They further argued that they do a medical inquiry as quickly as possible as it is in their interest to get the policy decided one way or the other.

The policy clearly stated that coverage was effective only when approved by the home office,after all inquiries were made. The Andersens knew that as well as the agent. If they were covered immediately, why would the company do a medical check?

Questions:

  1. Does the clause making the policy effective only after a medical examination violate public policy? Explain
  2. What other basis for a lawsuit might Martha have against the insurance company? Explain
  3. Based on your answers to Nos. 1 and 2 who will win this case and why?

Has Kilo acted unethically in any way(s)? Explain using one of the ethical philosophies from the readings and facts from the scenario.

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Case of Global Ethics vs. Global Economy

This is a case that will be tried in the court of Public Opinion.

Kilo Shoe Company, a United States corporation, buys clothing assembled by Crystal, LTD., a foreign company that employs children under 12 years of age. These children work nine hour days and for low pay. Crystal’s nation does not enforce its child labor laws limiting workdays to seven hours for children under 12. Many times the children’s income is needed by the family for basic necessities. Crystal and Kilo are aware of this.

Human International Politics (HIP), an international political activist organization, discovered Kilo’s connection to Crystal, LTD. HIP plans to reveal this information to the press and on social media. Kilo hears about this proposed action by HIP. Before HIP can act, Kilo terminates its relationship with Crystal. Kilo then publicizes this action in its advertising. The company’s sales and profits increase, apparently as a direct result.

  1. Has Kilo acted unethically in any way(s)? Explain using one of the ethical philosophies from the readings and facts from the scenario.
  2. From an ethical perspective, is Kilo’s conduct in terminating its relationship with Crystal more important than whatever its motive might be? Why or why not?

Should Dawn be forced to settle her claim through arbitration? Why? Assume your company’s arbitration policy was exactly like Tooters’. Name one aspect would you retain, and which one might you change? Why? Be specific.

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Tooter’s and ADR

Tooters Restaurant used an alternative dispute resolution program. Employees of Tooters had to sign an “agreement to arbitrate employment-related disputes” to be eligible for raises, transfers, and promotions. Under the agreement, both Tooters and the employee agreed to resolve all disputes arising out of employment, including “any claim of discrimination, sexual harassment, retaliation, or wrongful discharge, whether arising under federal or state law,” through arbitration.

In a separate policy document not shared with employees until after they had signed the agreement, Tooters set forth the rules and procedures of its arbitration program:

The employee had to provide notice of the specifics of the claim, but Tooters did not need to file any type of response to these specifics or notify the employee of what kinds of defenses the company planned to raise.

Only the employee had to provide a list of all facts or witnesses and a brief summary of the facts known to each.

While the employee and Tooters could each choose an arbitrator from a list, and the two arbitrators chosen would then select a third to create the arbitration panel that would hear the dispute, Tooters alone selected the arbitrators that were put on the list.

Only Tooters had the right to widen the scope of arbitration to include award any matter, whereas the employee was limited to the matters raised in his or her notice.

Only Tooters had the right to record the arbitration.

Only Tooters could cancel the agreement to arbitrate or change the arbitration rules.

Dawn had worked as a bartender at the Tooters restaurant for about five years before Tooters adopted its arbitration policy. Dawn was given a copy of the agreement to arbitrate to review for five days and then sign. Approximately two years later, a Tooters official grabbed and slapped her buttocks. After appealing to her manager for help and being told to “let it go,” she quit her job. When she threatened to file a lawsuit for sexual harassment, Tooters filed an action in federal district court to compel arbitration of Dawn’s claims.

  1. Should Dawn be forced to settle her claim through arbitration? Why?
  2. Assume your company’s arbitration policy was exactly like Tooters’. Name one aspect would you retain, and which one might you change? Why? Be specific.

It is acceptable to use the Power Point slides for the required text reference.

In October, 2019, California companies can no longer require employees to sign an agreement forcing harassment, discrimination and wage claims into arbitration as a condition of employment instead of being able to sue.

California’s legislation was careful not to conflict with the Federal Arbitration Act and U.S. Supreme Court case law that allows companies to enforce mandatory arbitration agreements. The new state law says it’s illegal to require mandatory arbitration as a condition for employment, but doesn’t invalidate existing agreements. It also protects employees from retaliation and allows them to go to the state Labor Commissioner’s Office.

What kind of suit will Jim file and what is its basis? Who are the Plaintiffs and who are the Defendants? Why? What are the defenses, if any, of Rico or Christina?

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The Case of the Director Who Wore Too Many Hats

Christina is one of 5 directors of Rico Investments Corporation. She is also a majority shareholder holding both common and preferred stock. Her stock with voting rights amounts to 47% of all stock issued with voting rights.

Christina buys, for $1,500, an option to purchase a tract of real estate called Blackacre, which is next to Rico’s home office, for $50,000. Christina forms a new corporation, Commercial Property, Inc., to hold the option. She then has Commercial Property buy Blackacre. As a director of Rico, Christina orders Rico to authorize its real estate agent to negotiate the purchase of the land from Commercial Property for $100,000. After a successful negotiation for the purchase of Blackacre for $100,000, Christina has Commercial Property sell it to Rico, and loan the money to Rico for the purchase price at a 5% interest rate which is 2% below the market rate. Jim, a minority shareholder in Rico, formally complains to Rico’s board which takes no action.

The Trial

Jim files a suit against Christina on Rico’s behalf seeking to cancel the sale. Christina asks the Court to dismiss the lawsuit as Jim has no standing to bring the lawsuit.

Arguments At Trial

Christina’s attorney argues that Blackacre is necessary for Rico as it will allow them to expand their offices and production plant thus increasing the net worth and potential profits to the shareholders. Further, the Board of Directors of Rico authorized the purchase which appeared to be in accordance with the Articles of Incorporation.

Jim’s attorney argues that the purchase of Blackacre should have been put to a vote of the shareholders of Rico as required by Rico’s Bylaws. Rico’s Board of Directors failed in its duty to make sure this sale was in the corporation’s best interest.

Questions to Decide

  1. What kind of suit will Jim file and what is its basis?
  2. Who are the Plaintiffs and who are the Defendants? Why?
  3. What are the defenses, if any, of Rico or Christina?
  4. Who will win the case and why?

Jeff Case, Mary McDonald, and Jen McManus tried to create a corporation in order to produce electric scooters. They satisfied all of the requirements, but did not file the corporate charter with the state of California. They believed that a valid corporation had been formed and conducted business as a corporation. After seven years, the corporation became bankrupt. The creditors of the corporation would like to hold each of the three owners of the business personally liable. Can they? Discuss.

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Discussion

  • David Walker and Robert Hudson were best friends and business partners. They paid $500,000 in cash for an old warehouse. Later, they received an appointment as promoters for a new corporation that would manufacture artificial arms. The corporation need a large production facility, and David and Robert sold the warehouse they owned for $800,000 worth of stocks in the new corporation once it was formed.

Later, the corporation was formed and the shareholders discovered just how much David and Robert paid for the facility. How much of the $800,000 in stocks is the new corporation entitled to cancel. Discuss.

  • Jeff Case, Mary McDonald, and Jen McManus tried to create a corporation in order to produce electric scooters. They satisfied all of the requirements, but did not file the corporate charter with the state of California. They believed that a valid corporation had been formed and conducted business as a corporation.

After seven years, the corporation became bankrupt. The creditors of the corporation would like to hold each of the three owners of the business personally liable. Can they? Discuss.

What three most important points should you, the defendant(carter), include in your opening statement? State briefly why they are important to your case.

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Brookson v. Carter, Defendant’s Worksheet

DEFENDANT’S WORKSHEET FOR TRIAL

Fred Brookson, a lifelong resident of Klamath Falls, Oregon, has hired your firm to file suit against Wendell Carter for injuries sustained as a result of an incident that occurred in southern Oregon. About three months ago, Brookson and his wife, Ellen, from whom he is now separated, participated in a demonstration concerning recent acts of violence against doctors practicing in a local abortion clinic. The demonstration occurred on a wharf extending into the Coos River. A group of people, including Wendell Carter, gathered around the demonstrators and began to heckle them. The two groups exchanged remarks and eventually, the hecklers threw rocks and bottles at the demonstrators. When Carter threw a rock that struck and injured Ellen, Fred became angry and approached Carter. Carter said he regretted injuring Ellen because he had been aiming at Fred. The two men exchanged heated remarks. Then, without any provocation, Carter pulled out a knife, screamed, and lunged at Brookson, intending to stab him. As Brookson jumped back to avoid being injured, he almost bumped into an unidentified demonstrator. The demonstrator, who apparently thought he was being attacked, struck Brookson several times and seriously injured him. Both Brooksons required hospital treatment. Fred Brookson ‘s medical expenses exceeded $75,000; his estranged wife’s expenses were approximately $2,000. Both have lost weight, exhibit chronic anxiety, and have periods of severe insomnia.

Carter grew up in California but has spent the last three years attending college and living with his brother in Oregon. Plaintiff’s attorney believes it best to bring this action in federal district court.

  • 1332. Diversity of Citizenship;

Amount in Controversy; Costs

(a) The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,00.00, exclusive of interest and costs, and is between …

(1) citizens of different States…

NOTE TO STUDENTS: (2,3 &4) have been intentionally omitted.

Jansen v. McLeavy (1987)

Mabel Jansen brought suit against the defendant for negligence and intentional infliction of emotional distress after the defendant’s car ran a stop sign and killed her young son. She witnessed the accident from her front yard. The jury awarded her $175,000 for the defendant’s negligence in causing the death of her son and $250,000 for intentional infliction of emotional distress. The defendant appeals only the latter award, and we reverse.

For intentional infliction of mental distress, proof of four elements is required to establish the cause of action: (1) the conduct of the defendant must be intentional toward the plaintiff; (2) the conduct must be extreme and outrageous; (3) there must be a causal connection between the defendant’s conduct and the plaintiff’s mental distress; and (4) the plaintiff’s mental distress must be extreme and severe. On this appeal, the defendant vigorously argues that the first element has not been met. The tort of intentional infliction of emotional distress requires some evidence that the defendant intended to inflict the emotional distress on the plaintiff. Although Jansen’s mental distress was great, the driver did not intend to cause that distress. While some jurisdictions have allowed recovery in similar circumstances on a theory that the defendant’s conduct made it probable that mental suffering would result, we will continue to require intentional infliction in this state.

Powers v. Locke (1989)

While plaintiff Anthony Powers and defendant James Locke were waiting in line to board a school bus, Locke shoved Powers in an effort to take his place in line. Powers fell through a glass door and suffered multiple injuries. Powers sued Locke for battery. The trial court entered a directed verdict in favor of Powers.

A defendant commits battery when he acts intending to cause a harmful or offensive contact with the plaintiff or a third person, and thereby causes a harmful or offensive contact with the plaintiff. Because battery is intended to protect a person’s body from intentional and unwanted contact, its protection extends to anything so closely connected with the person’s body as to be regarded a part of it, but it does not extend to contact that is legally consented to or otherwise privileged. One who commits battery is liable for no more than nominal damages unless the person contacted proves actual harm.

Locke’s argument that the evidence does not support a finding that he intended to cause injury to Powers is without merit. The tort of battery requires only that the defendant intend the contact that caused the harm, not the harm itself. Here, the evidence is uncontroverted that Locke intended to shove Powers. Locke also argues that Powers consented to the battery by agreeing to engage in a “shoving match” with Locke. Because the evidence presented at trial is conflicting on this issue, a directed verdict was improper. Reversed and remanded.

 

LEASE ANSWER THE FOLLOWING:

1. What three most important points should you, the defendant(carter), include in your opening statement? State briefly why they are important to your case.

2. List the three most important witnesses to your case and briefly state why they are important to your case.

3. List the three most important pieces of evidence you will introduce at trial and briefly state why they are important to your case/what each will prove. HINT: EVIDENCE = STUFF/THINGS. NOT PEOPLE.

4.You have been given the following statute/legal cases to work with:

  • 1332. Diversity of Citizenship

Jansen v. McLeavy (1987)

Powers v. Locke (1989)

Which one is the strongest for your side? State the law and elements and apply them to the facts of your case( Carter). For example, in XXXXXX, the law is _________________. The first element is __________ and applies to our case because ___________________, etc.)

 

5. You have been given the following statute/legal cases to work with:

 

  • 1332. Diversity of Citizenship

Jansen v. McLeavy (1987)

Powers v. Locke (1989)

 

Which one is the weakest for your side (carter)? State the law and elements and state why they are not helpful to the facts of your case. For example, in XXXXX, the law is _________________. The first element is __________ and does not apply to our case because ___________________, etc.

 

6. What evidence, law, fact, etc. in favor of the other side is the most damaging to your case(carter) ? Why?

Additional points to know and to remember:

  1. Court cases are underlined or in italics. Statutes are in italics.
  2. Your memo must be presented academically and free of grammatical errors.

Rey owed Imperial Bank $400. When he could not pay, the bank took a judgment against Rey and filed a garnishment against his wages. Rey’s employer agreed to run all of Rey’s salary over to the bank until the debt was paid in full. May the employer do so?

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Discussion

Question 11, page 633, Chapter 36

Q: Rey owed Imperial Bank $400. When he could not pay, the bank took a judgment against Rey and filed a garnishment against his wages. Rey’s employer agreed to run all of Rey’s salary over to the bank until the debt was paid in full. May the employer do so?

Instructions

  • Discuss and cite the resources. If you use your textbook, cite it too.
  • Provide one similar example, case, or lawsuit and one external source and cite it in your writing following the APA 7th edition style.
  • Cite all sources, including YouTube videos.
  • Use the internet to visit news websites, a government website, etc., to find cases, examples, etc.
  • The initial post should contain 250-300 words, and the reply should contain 100-150 words.

Note: Grading will be based on the quality and logic of the discussion and not necessarily on the word count. Ensure that all references follow the APA 7th edition guide (Please provide at least one external source= 2 points.)

Will the offering need to be registered with the Securities and Exchange Commission (SEC) under the Securities Act of 1933? Explain. Does your answer differ if “Shares in Learning” are issued by Private College, a proprietary for-profit institution that does business in all 50 states? Why?

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Securities Law

Private University, a private nonprofit educational institution located in Califor­nia, decides to issue “Shares in Learning” certificates in a one-time offering to the public. These shares will be sold for $500 each and entitle the bearer to redeem each certificate for two undergraduate or one graduate college credit in any of its schools at any time in the future. The shares may also be resold without restric­tion by the initial purchaser. The offering will be made via the Internet.

Will the offering need to be registered with the Securities and Exchange Commission (SEC) under the Securities Act of 1933? Explain. Does your answer differ if “Shares in Learning” are issued by Private College, a proprietary for-profit institution that does business in all 50 states? Why?

Are all three proposals eligible for award? If not, why? Assuming all eligible offers were determined technically acceptable, which of the offerors is the apparent successful contractor?

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Far Acquisition

Assume the Contracting Officer determined the FD examinations were outside the scope of SGM’s existing contract and recommended a new contract award. Solicitation W912QR- 21-R-3520 was issued, stating award would be made to the responsible offeror that submitted the lowest priced technically acceptable offer. Three proposals were received in response to the solicitation. Review the proposals (U7S3 Artifacts) and answer the following questions.

  1. Are all three proposals eligible for award? If not, why? (2 pts)
  2. Assuming all eligible offers were determined technically acceptable, which of the offerors is the apparent successful contractor? (2 pts)
  3. Which price analysis technique would be most appropriate to determine the price of the apparent awardee fair and reasonable?
    Why? [HINT: See FAR 15.404-1(b) (2)] (2 pts)

Using IRAC discuss Cabinet Co.’s and its employees’ duties, obligations, and remedies with respect to the fact pattern.

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2 case studies on Business Law knowledge

Case study 1

Before You Start

  1. Review IRAC.
  2. Read the chapters associated with this module.
  3. Carefully review the instructions and information below.

Important Guidelines

  1. Your score will be determined using the Critical Legal Thinking Case Study Rubric. Please read this rubric thoroughly before attempting this assignment.
  2. Your score will be determined by the evaluation of your substantive content. Using IRAC to structure and develop your answer is crucial. Your analysis and solutions must be based on the principles of law, ethics, and business—not on your opinions.
  3. Key facts are those facts that determine if the principles of law are met. You must demonstrate that you recognize the key facts in this case. Make sure you have identified those key facts and applied them in your IRAC.
  4. The length of your response doesn’t directly impact your score, but you need to provide a sufficient length of an answer to address the fact pattern completely. Although there is no minimum or limit, however, most responses will be at least two to three substantial pages.

Frank is the receiving dock supervisor for Cabinet Co., a company that manufactures metal storage cabinets. His job is to supervise the inspection and stocking of components and materials used in the manufacture of the cabinets as they are delivered and to notify the accounting department so invoices can be timely paid. On June 1, the company received a shipment of casters used in the manufacture of rolling cabinets. This new shipment would not be needed for three weeks, as there were plenty of casters located on the assembly line. The storage facilities where the casters would normally be placed were under renovation, and there would be no space to store this latest shipment of casters until June 20. Frank decided to leave the unopened boxes of casters in a secure and covered corner of the receiving dock. He did, however, notify the accounting department that the casters had been received. The accounting department paid the $8,000.00 invoice in time to earn the discount if paid within ten days.

On June 20 Frank had his workers open the boxes of casters to inspect them and place them in the appropriate space in the storage facility. Upon inspection, it was determined that nearly all of the casters were defective and unusable. This caused the company to default on several contracts for rolling cabinets as it ran out of casters before it could secure replacements for the defective ones. Cabinet Co. was able to replace the casters at a 15% increase in cost.

  • Using IRAC discuss Cabinet Co.’s and its employees’ duties, obligations, and remedies with respect to the fact pattern.
  • Using IRAC your answer should include the pro and cons outlined in the reading material. You should also discuss the elements of the cause of action, defenses, and your ultimate conclusion based on the fact pattern.

Case study 2

Before You Start

  1. Review IRAC.
  2. Read the chapters associated with this module.
  3. Carefully review the instructions and information below.

Important Guidelines

  1. Your score will be determined using the Critical Legal Thinking Case Study Rubric. Please read this rubric thoroughly before attempting this assignment.
  2. Your score will be determined by the evaluation of your substantive content. Using IRAC to structure and develop your answer is crucial. Your analysis and solutions must be based on the principles of law, ethics, and business—not on your opinions.
  3. Key facts are those facts that determine if the principles of law are met. You must demonstrate that you recognize the key facts in this case. Make sure you have identified those key facts and applied them in your IRAC.
  4. The length of your response doesn’t directly impact your score, but you need to provide a sufficient length of an answer to address the fact pattern completely. Although there is no minimum or limit, however, most responses will be at least two to three substantial pages.

Roger is a director of a major car manufacturer. This is one of the few remaining car companies yet to introduce a sport utility vehicle. Roger convinces the board to investigate forming a new division to design, build, and market a sport utility vehicle. Roger also convinces the board that the first sport utility vehicle that the division introduces should be the largest yet sold to the general public.

The board set up a committee to do some research, and this committee hired a marketing consulting firm. The committee and the consulting firm both had a few reservations about such a large vehicle, but the data showed that the market could most likely support it. After much discussion, the board of directors voted in favor of creating the new division and the huge sport utility vehicle as its first product. The vote was 9 to 6 in favor of the plan.

Shortly before this vehicle was introduced, there was a major oil supply disruption that caused the price of crude oil to nearly triple. Few purchasers were found for the huge new sport utility vehicle and the company lost considerable money. A shareholder filed suit against Roger claiming he violated his duty to the corporation by convincing the board to build and market the large SUV.

  • Using IRAC discuss the duties and defenses a director, here Roger, has to a lawsuit.
  • Using IRAC your answer should include the pro and cons outlined in the reading material. You should also discuss the elements of the cause of action, defenses, and your ultimate conclusion based on the fact pattern.