C.

35 minutes
A.M.D.G.

EXAM NO._____

THE UNIVERSITY OF DETROIT MERCY SCHOOL OF LAW

CIVIL PROCEDURE §75

(3 Hours and 20 Minutes)

Professor Richard Myers Final Exam

May 3, 1995 Spring Term, 1995

Instructions

This examination consists of 3 pages plus this instruction page. This is a 3 hour and 20
minute exam. The time limit indicated for each question reflects the relative importance of the
question.

During the examination, you may consult the casebook, the supplement, any handouts,
your class notes, and your outline. You are not permitted to consult any “secondary” sources,
e.g., hornbooks, commercial outlines, or student prepared outlines to which you did not
contribute significantly.

A word of advice. Please read each question carefully. Pay particular attention to the
precise question I have asked. You should spend time thinking about and organizing your answer
before you begin writing. If your answer depends on facts you have assumed, please state them.

Finally, please write legibly!

C.35 minutes
Question I
(95 Minutes)

Rayne Storm was a United States citizen who made his domicile in Seattle, Washington.
Five years before his death, Storm took out a life insurance policy that would pay the designated
beneficiary $1 million on his death. According to the policy, the entire amount can only be
distributed to one individual. The insurer was the XYZ Corporation, a California corporation
with its principal place of business in California. XYZ maintains a large office in Seattle.

Storm had 15 grandchildren, all of whom are United States citizens with domiciles in
Seattle, Washington. For purposes of this exam question, the grandchildren will be identified by
the letters A-O. When Storm first established the policy he named A as the sole beneficiary.
Storm was a bit eccentric and every time it rained he would change the beneficiary of the policy
to one of the other grandchildren. So, depending on the day and the weather any one of the 15
grandchildren might be the sole beneficiary of the policy.

At the age of 95, on a dark and stormy night, Storm died. A, one of the grandchildren,
has now filed a state law claim against XYZ in federal district court in Washington to recover
the proceeds of the insurance policy. (For purposes of this question, assume that the entire state
of Washington constitutes a single judicial district.) As you might imagine, there is quite a
dispute about the identity of the beneficiary at the time of Storm’s death. Storm was nearly
unconscious during the last two weeks of his life (during which he changed the beneficiary
numerous times) and there is, therefore, a question about the validity of these purported changes
in the beneficiary. Also, according to A, some of the other grandchildren exercised undue
influence over Storm and this influence raises additional questions about the validity of some of
the changes made during the last two weeks of Storm’s life.

A. 35 minutes

You are XYZ’s General Counsel. You want to have the case dismissed. Assume that
XYZ is subject to personal jurisdiction in Washington. What arguments would you make in
favor of dismissal and how would you rate your chances of success? Explain your reasoning.

B. 25 minutes

Assume that XYZ’s motion to dismiss has been denied. The other grandchildren, B-O,
want to participate in A’s lawsuit. Assume that there is absolutely no cooperation between A and
the other grandchildren and so B-O have been unable to get A’s voluntary cooperation to join his
(A’s) suit against XYZ. You are a law clerk to the federal district court judge to whom the case
has been assigned. What arguments do you think B-O will make to try to participate in A’s suit
and how will you advise your judge about whether he should allow them to participate? Explain
your reasoning.
C.35 minutes
C. 35 minutes

Assume that no one has yet filed a lawsuit to resolve this controversy. You are XYZ’ s
General Counsel again. Is there some way that XYZ can bring all the grandchildren, A-O, into
one suit to resolve the controversy about which one of the grandchildren is the proper
beneficiary? Assume that XYZ wants to do this in federal court in Washington. Explain your
reasoning.

Question II
(45 Minutes)

A brings an action against B for the purchase price of a boiler sold by A to B. Three
weeks after the boiler was delivered to B’s home, the boiler exploded causing serious injuries to
B and to C, the wife of B. B defended the suit on the sole ground that the full price for the boiler
had been paid. After a full trial, judgment is given for A.

A. Would B be able to maintain a suit against A for restitution of any amount paid
pursuant to the contract action described above? Assume that B’s theory is that the boiler was in
a defective condition and that it would therefore be unfair for A to receive the agreed upon
purchase price.

B.
1. Assume that the events described in part A. of this question did not happen (that is, B
has not yet filed any action against A). Would B be able to maintain an action against A to
recover for his personal injuries based on the argument that A was guilty of breach of warranty
for selling the boiler in a defective condition?

2. Assume that in the suit described in B.1. the court finds that A did breach a warranty
by selling the boiler in a defective condition, but the court gives judgment for A because it finds
that B was contributorily negligent because B installed the boiler in an inappropriate manner.
Assume that B’s contributory negligence is a complete defense to the breach of warranty claim.
C wants to file an action against A for the personal injuries she suffered in the explosion based
on a breach of warranty claim. Will the B v. A suit described in this paragraph (B.2) have any
effect on C’s suit?

3. Assume that in the B v. A suit B recovers because the court finds that A did breach
a warranty by selling the boiler in a defective condition. Assume that in this subpart (B.3)
that A did not have available a contributory negligence argument because A installed the
boiler. Will this version of the B v. A suit (in which B recovers) have any effect on a suit by
C against A for the personal injuries she suffered in the explosion based on a breach of
warranty claim?
C.35 minutes
Question III
(60 Minutes)

A. A was driving his car when it was struck from behind by a car that was driven by B. C
was a passenger in B’s car. Assume that A has filed a state law suit against C in federal court
based on diversity. For reasons that are too complicated to discuss here, A had a good faith belief
that C was the driver of the car that struck him. A’s suit against C was filed one month before the
state statute of limitations was to expire.

Two months after the complaint was filed, A discovers his mistake and now seeks
permission from the federal court to amend his complaint to substitute B as the defendant.
Assume that this proposed amendment would be regarded as untimely by the state court. How
should the federal judge rule on A’s motion to amend his complaint? Assume that B now (two
months after the original complaint was filed) knows about the lawsuit and that B would not
have any difficulty in maintaining a defense on the merits. Also assume that B now knows about
the reason for A’s error about who was driving the car that struck A’s car. In discussing the
motion to amend, ignore any jurisdictional issues.

B. A was driving a car when it was struck from behind by a car that was driven by B. A
filed a state law claim in federal court based on diversity to recover for the damage to his car. A
was successful in this suit and now has filed a state law claim in federal court against B to
recover for the personal injuries (a broken arm) A suffered in the accident. B has filed a motion
to dismiss on claim preclusion grounds. The federal court has denied the motion to dismiss. Can
B take an appeal as a matter of right? Do not discuss the merits of the appeal.

C. Under the current version of Federal Rule of Civil Procedure 11 is the federal district
court required to award a sanction if the court finds that a Rule 11 violation has been
established? Assume that the district court decides not to award a sanction and that ultimately the
propriety of that decision (not to award a sanction) is properly before a federal court of appeals.
What standard of review should the court of appeals use in ruling on the appeal by the victim of
the Rule 11 violation? Do not discuss the merits of the appeal.

D. A sues B and C in federal court. B files a third party complaint against D. Do the Federal
Rules allow D to file a “claim” against C? (Ignore any jurisdictional problems.)