If not Ghostbusters, then perhaps your lawyers. They would probably consider at least two situations.

First, in the context of the formation of contracts, a misrepresentation is a false statement of fact made by one party, which causes another party to enter into the contract, and which gives that latter party the right to set the contract aside. So, if you were spooked enough to ask whether the house was haunted, and if the sellers were skeptical enough to say that it wasn’t, and if a court were to find that it was in fact haunted, then you would be able to set the contract aside for misrepresentation.

Second, whilst there is no general duty of disclosure, particular duties of disclosure can – exceptionally – arise; in such cases, a material non-disclosure by one party, which causes another party to enter into the contract, gives that latter party the right to set the contract aside. So, even if you didn’t ask whether the house was haunted, but if a court were to find that it was, that the sellers knew about it, that they chose not to tell you about it, and that they should have done, then you would be able to set the contract aside for this material non-disclosure.

Of course, both of these hypotheticals turn on the fact that the court would find as a fact that the house was haunted. And no court would do that, would it?

Well, in Stambovsky v Ackley 572 NYS 2d 672 (NY App Div 1991) (blog post | ContractsProf Blog here and here | full text | the house | wikipedia), the New York Court of Appeals confirmed the orthodoxy that the doctrine of caveat emptor imposes no duty upon the vendor of property to disclose any information concerning the property; but it held that, by way of exception, a duty of disclosure could arise if there is some conduct on the part of the vendor which constitutes “active concealment”. Moreover, in an entertaining decision citing Hamlet and Ghostbusters (the movie and its theme song), the Court held that since the seller had deliberately fostered the public belief that her house was haunted, she was estopped from denying that it was, and it followed that

…. as a matter of law, the house is haunted.

The purchaser was not a local and was unaware of the house’s reputation, which the seller actively sought to conceal during the negotiations for the purchase and sale of the house:

It has been remarked that the occasional modern cases which permit a seller to take unfair advantage of a buyer’s ignorance so long as he is not actively misled are “singularly unappetizing” (Prosser, Torts § 106, at 696 [4th ed 1971] [[5th ed here]]). Where, as here, the seller not only takes unfair advantage of the buyer’s ignorance but has created and perpetuated a condition about which he is unlikely to even inquire, enforcement of the contract (in whole or in part) is offensive to the court’s sense of equity. Application of the remedy of rescission … is entirely appropriate to relieve the unwitting purchaser from the consequences of a most unnatural bargain.

Hence, on these unusual facts, the court allowed the purchaser to rescind or set aside the contract. the facts may have been unusual, but the legal structure of the argument was not. It is a classic case of material non-disclosure. An excellent example is provided by Obde v Schlemeyer 56 Wn 2d 449, 353 P2d 672 (1960). Here, the Supreme Court of Washington held that seller of house should have told buyer that it was infested by termites. Although the vendors knew there was widespread termite infestation in the residence, the purchasers did not. The vendors argued that they had no duty to inform the purchasers of the termite condition because the purchasers had not so inquired. This court, however, held that such a duty existed, and allowed the purchasers to set aside the contract. Moreover, Obde v Schlemeyer has been several times referred to as a classic example of fraudulent concealment (Hughes v Stusser 68 Wn 2d 707, 415 P2d 89 (1966); Atherton Condominium Association v Blume Development Co 115 Wn2d 506, 799 P2d 250 (1990)). Once the Court in Stambovsky found that the seller was estopped from denying that the house was haunted, then it was exactly the same as Obde: in both cases, an important fact was concealed by the seller, and it was such an important fact that it would have changed the purchaser’s mind had it been disclosed. As the New York Times observes, in an article headlined Some Buyers Regret Not Asking: Anyone Die Here?

Today, a home associated with a murder or suicide can become what some brokers call a stigmatized property. So can homes reputed to have a resident ghost. Although they are free of physical defects like leaky roofs or lead paint, such properties can so spook potential buyers that they linger on the market and command less than market value. Or, the discovery of the death can prompt a sudden change of course.

The moral of the story, I suppose, is that a seller might have no general duty to speak, but should nevertheless consider whether silence really is the best policy in the face of stigmatizing facts. For example, it seems that Joan Rivers is seeking to sell her Fifth Avenue penthouse apartment, and there are reports that purchasers may get not only the formal dining room and ornately panelled library but also the ghost of a previous owner, so the question is whether she should come clean about the apartment’s additional occupant.

However, the law is different on this side of the Atlantic. Sykes v Taylor-Rose [2004] All ER (D) 468, (2004) 2 P&CR 30, [2004] EWCA Civ 299 (27 February 2004) is a graphic example. The defendants sold their house eighteen months after discovering that it had been the scene of a gruesome and infamous murder; the plaintiffs purchased the house, but learned of its history seven months later when it was featured on a television programme about the murder. (It was a very controversial case, which has featured in many news stories). The Court of Appeal reaffirmed the orthdoxy that there is, in property transactions, no general duty of disclosure (so that the doctrine of caveat emptor applied without exception). Failing to disclose a history of this kind would amount to active concealment giving rise to an actionable non-disclosure in the US, but not in the UK. Perhaps, therefore, the millionaire businessman who claimed that ghosts forced him to flee the 52-room Nottinghamshire mansion he had bought the previous year should instead have kept silent and simply sold the mansion. In that case, instead of calling Ghostbusters, or his lawyers, he should have called his estate agents. And if you’ve bought a haunted house, perhaps you might wish to do the same.

Happy Hallowe’en!

By Meredith R Miller on ContractsProf Blog, a story that needs no further commentary:

Was Carrie Prejean Unjustly Enriched? (Nudge Nudge Wink Wink)

You’ll undoubtedly recall that, back in May, we mentioned that Miss California USA (aka Donald Trump) might terminate then-Miss California Carrie Prejean for breach of contract; Prejean was in fact de-crowned, and she sued the pageant organizers for a whole host of things, including discrimination based on her anti-gay marriage stance and violation of her privacy when a representative acknowledged publicly that she had breast implants. The franchise wasted no time with a countersuit and, according to CNN, one of the claims seeks to recover some $5000 the pageant organizers loaned Prejean for the breast implant surgery – pursuant to an oral agreement between the parties.

Some stories, even contracts profs can’t make up. This ugly tale of caution is one of them.

Update (12 November 2009): the case has settled, but controversy continues to follow her.

Thomas Jefferson wrote that the First Amendment to the US Constitution erected “a wall of separation between Church & State”. This doctrine of the separation of church and state is taken to work both ways: a secular government should not establish or endow a formal state religion, and religious exercise should be free of state interference. The Irish provisions on this issue are contained in Article 44 of Bunreacht na hÉireann (the Irish Constitution):

1. The State acknowledges that the homage of public worship is due to Almighty God. It shall hold His Name in reverence, and shall respect and honour religion.

2.1° Freedom of conscience and the free profession and practice of religion are, subject to public order and morality, guaranteed to every citizen.

2° The State guarantees not to endow any religion.

3° The State shall not impose any disabilities or make any discrimination on the ground of religious profession, belief or status. …

Section 99 of the Charities Act, 2009 (pdf) raises many questions for this Article. It provides

(1) A person who sells a Mass card other than pursuant to an arrangement with a recognised person shall be guilty of an offence. …

(3) In this section … “Mass card” means a card or other printed material that indicates, or
purports to indicate, that the Holy Sacrifice of the Mass … will be offered …

[and] “recognised person” means (a) a bishop … or (b) a provincial of an order of priests … [of the Holy Catholic Apostolic and Roman] Church …

In yesterday’s Irish Times, David Kenny – who is working on a PhD the place of religion in the Irish Constitution in the School of Law, Trinity College Dublin – considers the various issues that have arisen in a current challenge to the constitutionality of section 99:

Judgment expected soon on challenge to Mass card regulations

The High Court recently devoted four days to a case which explored the extent to which a particular religious practice could receive protection from the State. …

The High Court will shortly give judgment in the case of McNally v Ireland, a constitutional challenge to section 99 of the Charities Act 2009. … If Mr McNally prevails, it will set a limit on the subtle elision of church and State and the favouring of religion. If he loses, the judgment will join those narrowing the scope of the discrimination guarantee as another indication that the State may constitutionally show significant favour to religion, even one particular religion. Mr Justice John McMenamin is expected to give judgment in coming weeks.

More background: Clerical Whispers blog here, here and here | Mass card sale ban challenged in court | Court fight begins on Mass card monopoly | Challenge to Mass card ban | Suspended priest’s name on Mass cards, court told | In Short – Judgment reserved in Mass card case.

The always-excellent Human Rights in Ireland blog has two wonderful posts on the case, one when it began, and the other picking up Kenny’s Irish Times piece, and Eoin O’Mahony (who has a comment below) has a very thoughtful discussion of this post.

Among his many accomplishments, Alex Steuart Williams – with Graham Francis Defries – draws and writes the weekly Queen’s Counsel cartoon column in the Times. Williams has just released a new book of cartoons, 101 Ways to Leave the Law. From his website, a typical observation concerning the evolution of man lawyers:

Suggestions welcome as to where scruffy, messy academic lawyers fit in to this picture.

I remember this one time, at BarCamp Dublin, I went to Darren Barefoot’s presentation, and he said

Things live forever on the web … the internet never forgets.

Total recall online is now a common trope, and one which forms the starting point of Viktor Mayer-Schönberger’s provocative new book Delete: The Virtue of Forgetting in the Digital Age (Princeton University Press, 2009). Your privacy is gone, and you don’t know what you’ve lost till it’s too late. Two years ago, Dan Solove warned in The Future of Reputation: Gossip, Rumor, and Privacy on the Internet (Yale University Press, 2007) that a permanent online chronicle of our private lives could mean that the freedom of the internet makes us less free. Now, for the “future that is forever unforgiving because it is unforgetting”, Mayer-Schönberger proposes the remedy of induced forgetting for the internet’s elephantine memory Read the rest of this entry »

One Irish politician recently appealed to another not to do anything “precipitous“.

Interesting appeal, but did the appealing (well, actually, unappealing) politician really mean that?

The Compact Oxford English Dictionary provides:

precipitous
/prisippitss/
• adjective 1 dangerously high or steep. 2 (of a change in a condition or situation) sudden and dramatic. 3 hasty; precipitate.

and

precipitate

• verb /prisippitayt/ 1 cause (something bad) to happen unexpectedly or prematurely. 2 cause to move suddenly and with force. 3 Chemistry cause (a substance) to be deposited in solid form from a solution. 4 cause (moisture or dust) to be deposited from the atmosphere or from a vapour or suspension.

• adjective /prisippitt/ done, acting, or occurring suddenly or without careful consideration.

• noun /prisippitayt, -tt/ Chemistry a substance precipitated from a solution.

Unsurprisingly, the late William Safire (whose special gift was in conveying his pleasure in ruminating about language) clarified that precipitous (”steep”) and is not a synonym for precipitate (”abrupt, rash, headlong”). It is one of the Common Errors in English Usage identified by Paul Brians:

Both of these adjectives are based on the image of plunging over the brink of a precipice, but “precipitate” emphasizes the suddenness of the plunge, “precipitous,” the steepness of it. If you make a “precipitate” decision, you are making a hasty and probably unwise one. If the stock market declines “precipitously,” it goes down sharply.

Perhaps if the (un)appealing politician had the other not to do anything “precipitate” things might have turned out differently? Well, perhaps not, but the appeal would have been more grammatically accurate.

The title of this post comes from the headline in an interesting and provocative article by Larry Donnelly of NUI Galway (pictured left) in Monday’s Irish Times. His core argument is that the preparation of students for law practice should play a greater role in legal education in Ireland:

Historically, law study at third-level institutions in Ireland and in other common law jurisdictions was theory-based and took place exclusively in lecture halls. Law, however, is both an academic and a vocational discipline. Accordingly, law schools in every other common law jurisdiction have embraced the role of practice in legal education, but Irish law schools still lag far behind.

I entirely agree. Clinical and experiential learning centers on providing students with hands-on opportunities to understand how the law works in the real world. Along with the legal skills traditionally taught by law schools (legal research, legal analysis, and sometimes the ability to engage with policy and theoretical literature), the modern law degree should also seek to inculcate written and oral communication skills, interview skills, team-work, legal drafting, negotiation, advocacy, case management and practice management. 2007 saw the foundation of two very exciting Law Schools committed to this appraoch. The School of Law in the University of York began life with a bang, offering a completely progressive, clinical and experiential undergraduate curriculum, with problem-based learning modules centred on what they call the student law firm. The curriculum at School of Law at the University of California, Irvine self-consciously focuses on preparation for practice in the 21st century. Other successful start-ups, such as Bond in Australia and Northumbria in the UK, have built their programmes around legal skills as well as legal doctrine. Indeed, many established law schools the world over are in the process of adding important clinical elements to their curricula: the market leader in the US is the new third year program in the School of Law in the University of Washington and Lee in Virginia (even staid Harvard has made some moves in this direction). Moreover, the importance of this kind of development has already been appreciated in Ireland: NUI Galway has a Director of Clinical Legal Education, UCC established a degree in clinical legal education in 2004, whilst UCD has just announced a similar degree. Unsurprisingly, therefore, at the recent Legal Education Symposium, the most exciting plenary was on the topic of Law Schools and Clinical Legal Education, whilst the session on Experiential Learning was well attended and provoked lively debate. Read the rest of this entry »

The Hunting of the Snark is a nonsense poem written by Lewis Carroll subtitled An Agony in 8 Fits. In Fit 6, the Barrister dreams that the eponymous Snark serves as counsel for the defence, finds the verdict as the jury, and passes sentence as the judge. Perhaps it is fitting then to observe that, by way of update to yesterday’s post about Bofinger v Kingsway Group Limited [2009] HCA 44 (13 October 2009), Legal Eagle on SkepticLawyer characterises the judgment as “yet another snark at unjust enrichment”. True, but reaffirming a light approach to the “unifying legal concept” of unjust enrichment is not necessarily a bad thing, even if the tone is indeed unnecessarily snarky. She does concede that, “to give the High Court credit where credit is due, it gives reasoned arguments for rejecting the Banque Financière decision (see Banque Financière de la Cité v Parc (Battersea) Ltd [1999] 1 AC 221; [1998] UKHL 7 (26 February 1998)). It would sound quite reasonable if it weren’t for the usual snark beforehand” (given my views in my earlier post, it’s no surprise that I agree with her here). Her snark is that the Court does not provide similarly reasoned arguments for what she sees as negative knee-jerk responses to unjust enrichment reasoning. Among the questions she says the Court is ducking:

Are there benefits to having a unified concept of unjust enrichment? Are there detriments? Are all restitution scholars necessarily indulging in “top-down reasoning”? Is top-down reasoning necessarily a bad thing? Should the law evolve? I mean, they’re the High Court — within reason, the law is what they say it is. Why have the English courts made the changes they have? How have these changes worked? Have they made private law more manageable or less? I don’t mind so much what position the High Court takes on these questions as long as it actually thinks about it rather than just snarks. … I really wish the High Court would either (a) engage in reasoned criticism of unjust enrichment scholars or (b) desist from snarking.

I must say that I didn’t read the unjust enrichment comments quite as negatively as Legal Eagle did. Read the rest of this entry »