TQ 3.1: How did the D.C. Court of Appeals’ decision in Hernandez v. Banks change the law regarding the enforceability of contracts entered into by mentally incapacitated persons? Why did the court make this change?
TQ 3.2: What two defenses did the insurance carrier assert in Harleysville Worchester Insurance v. Diamondhead Property Owners Association in an attempt to avoid any duty to defend or indemnify under the policy? How did the court hold on each of the asserted defenses? What was the outcome with regard to coverage under the policy?
TQ 3.3: In Pioneer Industries Inc. v. Hartford Fire Insurance Co., what specifically did Pioneer do that constituted fraud? Why did the court conclude that it was irrelevant whether Hartford would have issued the policy even if it had been aware of these facts?
TQ 3.4: How did the decision in Riverisland Cold Storage , Inc. v. Fresno-Madera change the rule established in Bank of America v. Pendergrass?
DQ 3.1: What do you think of the D.C. Court of Appeals’ decision to overrule the 1892 case of Sullivan v. Flynn? Do you think the court’s new approach offers greater protection to persons with mental impairments? Is there a potential it could lead to abuses or unfairness? In light of the importance of the principle of stare decisis, was the court justified in departing from a hundred-plus year old precedent?
DQ 3.2: A letter to the New York Times’ “ethicist” (https://www.nytimes.com/2013/09/22/magazine/garage-sale-arbitrage.html?smid=pl-share&_r=1) posed the following question:
Is it ethical to buy something at a yard sale or a flea market at the seller’s asking price if you know the value of the item to be significantly higher than what is being asked? Let’s say, for example, someone is selling an old comic book worth thousands of dollars but asks for only a quarter because he or she does not know the true value. Is it incumbent on the seller to do his or her research? If the seller does not, is it fair game?
First, put aside the ethical issues for a moment and consider the legal question: If the buyer purchases the comic book at the asked-for price, and the seller then discovers the book’s true value, would the seller be able to rescind the contract? Now consider the ethical issues. Do you agree with the New York Times’ columnist’s response to the reader? How would you have responded to the question?
