ASSIGNMENT
Thomas Clements brought an action to recover damages for breach of warranty against defendant Signa Corporation. (A warranty is an obligation that the seller of goods assumes with respect to the quality of the goods sold.) Clements had purchased a motorboat from Barney’s Sporting Goods, an Illinois corporation. The boat was manufactured by Signa Corporation, an Indiana corpo- ration with its principal place of business in Decatur, Indiana. Signa has no office in Illinois and no agent authorized to do business on its behalf within Illinois. Clements saw Signa’s boats on display at the Chicago Boat Show. In addition, literature on Signa’s boats was distributed at the Chicago Boat Show. Several boating magazines, delivered to Clements in Illinois, contained advertisements for Signa’s boats. Clements also had seen Signa’s boats on display at Barney’s Sporting Goods Store in Palatine, Illinois, where he eventually purchased the boat. A written warranty issued by Signa was delivered to Clements in Illinois. Although Signa was served with a summons, it failed to enter an appearance in thiscase. The court entered a default order and, subsequently, a judgment of $6,220 against Signa. Signaappealed. Decision?
8. Mariana Deutsch worked as a knitwear mender andattended a school for beauticians. The sink in her apartment collapsed on her foot, fracturing her big toe and making it painful for her to stand. She claims that as a consequence of the injury she was compelled to abandon her plans to become a beautician because that job requires long periods of standing. She also asserts that she was unable to work at her current job for a month.
She filed a tort claim against Hewes Street Realty for negligence in failing to maintain the sink properly. She brought the suit in Federal district court, claiming damages of $25,000. Her medical expenses and actual loss of salary were less than $1,500; the rest of her alleged damages were for loss of future earnings as a beautician. Hewes Street moved to dismiss the suit on the basis that Deutsch’s claim fell short of the jurisdictional requirement, which then was $10,000, and that the Federal court therefore lacked subject matter jurisdiction over her claim. Decision?
9. Vette sued Aetna under a fire insurance policy. Aetnamoved for summary judgment on the basis that the pleadings and discovered evidence showed a lack of an insurable interest in Vette. (An “insurable interest” exists where the insured derives a monetary benefit or advantage from the preservation or continued existence of the property or would sustain an economic loss from its destruction.) Aetna provided ample evidence to infer that Vette had no insurable interest in the contents of the burned building. Vette also provided sufficient evidence to put in dispute this factual issue. The trial court granted the motion for summary judgment. Vette appealed. Decision?
10. Mark Womer and Brian Perry were members of the U.S. Navy and were stationed in Newport, Rhode Island. On April 10, Womer allowed Perry to borrow his automobile so that Perry could visit his family in New Hampshire. Later that day, while operating Womer’s vehicle, Perry was involved in an accident in Manchester, New Hampshire. As a result of the accident, Tzannetos Tavoularis was injured. Tavoularis brought action against Womer in a New Hampshire superior court, contending that Womer was negligent in lending the automobile to Perry when he knew or should have known that Perry did not have a valid driver’s license. Womer sought to dismiss the action on the ground that the New Hampshire courts lacked jurisdiction over him, citing the following facts: (a) he lived and worked in Georgia, (b) he had no relatives in New Hampshire, (c) he neither owned property nor possessed investments in New Hampshire, and (d) he had never conducted business in New Hampshire. Did the New Hampshire courts have jurisdiction?
11. Kenneth Thomas brought suit against his former employer, Kidder, Peabody & Company, and two of its employees, Barclay Perry and James Johnston, in a dispute over commissions on sales of securities. When he applied to work at Kidder, Peabody & Company, Thomas had filled out a form, which contained an arbitration agreement clause. Thomas had also registered with the New York Stock Exchange (NYSE). Rule 347 of the NYSE provides that any controversy between a registered representative and a member company shall be settled by arbitration. Kidder, Peabody & Company is a member of the NYSE. Thomas refused to arbitrate, relying on Section 229 of the California Labor Code, which provides that actions for the collection of wages may be maintained “without regard to the existence of any private agreement to arbitrate.” Perry and Johnston filed a petition in a California State court to compel arbitration under Section 2 of the Federal Arbitration Act. Should the petition of Perry and Johnston be granted?
12. Steven Gwin bought a lifetime Termite Protection Plan for his home from the local office of Allied-Bruce, a franchisee of Terminix International Company. The plan provided that Allied-Bruce would “protect” Gwin’s house against termite infestation, reinspect periodically, provide additional treatment if necessary, and repair damage caused by new termite infestations. Terminix International guaranteed the fulfillment of these contractual provisions. The plan also provided that all disputes arising out of the contract would be settled exclusively by arbitration. Four years later Gwin hadAllied-Bruce reinspect the house in anticipation of sell- ing it. Allied-Bruce gave the house a “clean bill ofhealth.” Gwin then sold the house and transferred the Termite Protection Plan to Dobson. Shortly thereafter, with termites. Allied-Bruce attempted to treat and repair the house, using materials from out of state, but these efforts failed to satisfy Dobson. Dobson then sued Gwin, Allied- Bruce, and Terminix International in an Alabama state court. Allied-Bruce and Terminix International asked for a stay of these proceedings until arbitration could be carried out as stipulated in the contract. The trial court refused to grant the stay. The Alabama Supreme Court upheld that ruling, citing a state statute that makes pre- dispute arbitration agreements unenforceable. The court found that the Federal Arbitration Act, which preempts conflicting state law, did not apply to this contract because its connection to interstate commerce was too slight. Was the Alabama Supreme Court correct? Explain
