Is Blackmail Really a Contract?

Posted on November 17, 2009 by Gavin Craig

There is an interesting series of comments in theContract Prof Blog, and others, asking whether blackmail is just a form of contract. The odd thing is that blackmail certainly meeting the legal definition of contract, with an offer, acceptance and consideration. But then so would a contract for Murder, but that doesn't make it a contract.

But can the blackmailer sue for damages? The discussion was generated because of the Letterman case, where Letterman accused the alleged blackmailer of demanding money in exchange for withholding information about Letterman's affairs with staff members. While this is an interesting academic discussion, the fact that blackmail is a crime makes this a very different matter.

But the real question is whether there could be a contract, and I think the answer is yes, there could be. In fact, I understand that the defense is just that: there was a contract for a screenplay that disclosed these facts about Letterman. Would there be an enforceable contract if Letterman contracted to purchase all rights to the screenplay, and thereby prevent its publication? This later scenario sounds more like a contract. But it could also be blackmail.

I would think it would be hard to convict someone if there really was a screenplay with the embarrassing information in it. I don't know if there is, but it is still a fun academic exercise.

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Who is a Party to a Contract? Sometimes the Participants are Surprised!

Posted on November 5, 2009 by Gavin Craig

How often does an officer of a corporation sign a contract, listing the business as the contracting party, but neglect to indicate that the business is a corporation or an LLC?  Then sign the contract? 

Marc Ward in his Blog discusses a case of, who are the parties to the contract?

Marc writes:

In Builders Kitchen and Supply Co. v. Moyer, N0. 0-655/09-0194 (September 2, 2009) is a deceptively simple case.  On the one hand it represents the folly of not having even run of the mill contracts reviewed by lawyers before they are signed.  And on the other hand, it is a warning to lawyers that things aren't as simple as they appear.

Frank Moyer signed a contract with Builders Kitchen for the purchase and installation of some kitchen cabinets and countertops.  The contract was just two pages long.  On the first page there was a place for the name of the business and a little later a space to indicate the type of entity.  Moyer filled in the name of his business, Crystal Creek Development, but neglected to indicate that it was a corporation.  He signed the contract as "Frank Moyer, Pres." The second signature line, presumably for the guarantor, was left blank.

The question for the court was, is Frank Moyer a party to the contract?  As a simply matter of agency law, the answer has to be “Yes.”  The officer of the corporation is an agent, and the agent has the duty to disclose the existence and name of the principal.  For a lawyer these are fun cases, but I have had numerous attorneys argue with me that filing articles of incorporation are all the notice that the agent (officer) needs to give.  That position, by the way, is not the law. 

In Minnesota there is a famous case where the same thing happened.  Except that in the Minnesota case the defendants were lucky.  They had paid for the goods with checks that clearly showed that the seller was selling to a corporation, and the court found that the checks were sufficient  notice.    See Paynesville v. Ever Ready Oil, 379 NW2d 186 (Minn. App. 1985)

Earlier in my career I had an opposing counsel argue that a person listed as a contracting party and who signed the contract was really not intended to be a party. 

Most people, including especially small business owners, are very informal when signing contracts, and create real problems for the principal of any company.  The lesson is clear.  Have an attorney review the contracts.  Marc is right:  Pay me Now or Pay me Later. 

 

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I learned to Speak French Listening to my GPS. (Some off Topic Comments on Travel)

Posted on November 4, 2009 by Gavin Craig

I recently returned from a trip to France, and we took our GPS to use with our rental car. The GPS worked very well in France, about 95% of the time. The few exceptions include the time the GPS directed us to what can only be described as a rocky wilderness fire road. The wilderness road eventually led to the place we were headed, but it was so narrow we couldn’t turn around. But the GPS was always correct in that it guided us to the places we intended to go. We inadvertently saw a part of France we never intended to see, but it was a pretty area.

Occasionally the GPS would lead us to a single lane road along side the highway where we should have been. Unfortunately you don’t always know you should ignore the GPS until it is to late. Especially in a foreign country.

On the positive side, the GPS guided us flawlessly through the Paris highways as we drove through the city on our way to Provence.

The GPS voice system would tell us to turn on a named street. The problem in France is that you can’t see street names very often, and of course the GPS could not pronounce the French names. (But I must confess that the GPS spoke French better than I do, which is very faint praise.) The GPS gave instructions in English or we would still be there and lost.

I learned one thing though. If you’re going to rent a car in a foreign country – use a GPS. It made life a lot easier, as well as more exciting on occasion.

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