Tuesday, January 26, 2010

Lions and Tigers

"Of Lions and Tigers and Contract Terminations"

I'm happy that SCOTUSblog today was just as amused as I was last week with Justice Breyer's "lions and tigers" hypothetical in oral argument for Mac's Shell Service Inc. v. Shell Oil Products Co. The case concerns the difference between "constructive termination" and "implicit termination." As the law currently stands, constructive termination denotes a situation where the franchisee (i.e. a renter) voluntarily terminates a contract because the conditions have become intolerable (a leaser shuts off the water, electricity, dumps ants somewhere, etc). Implicit termination is when a franchisor behaves in a way that any reasonable person would believe that the franchisor themselves had terminated the contract (i.e. the leaser bulldozes the house). Implicit is clearly drawn, while constructive is fuzzy law. Hence, the following quote from argument last Tuesday:

Justice Breyer: "Now, suppose it's the same situation, but this person, the franchisee, being quite indefatigable and daring, finds a way of sneaking through the barbed wire that has been put up. And there is one pump they forgot, and there is a car that comes up and he serves that person. Now is it constructive eviction?"
Mr. O'Neil: "No -- That's where an objective standard is important..."

Justice Breyer: "Objective? You would say any sensible person would clear out immediately. There are lions and tigers roaming the gas station!"
Hypotheticals can be outstanding for their ability to clarify recondite principals. But as Justice Breyer has a tendency to show, revealing his stripes from 27 years as a law professor, those same principals taken to their extremes can add some much appreciated humor to an otherwise dry subject.

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