Gale Encyclopedia Of American Law 3Rd Edition Volume 8 P50 pot

If the goods are only partially destroyed or have deteriorated, the buyer may demand to inspect the goods and either void the contract or accept the goods with a reduction in the contrac

buyer and seller A contract may be made verbally or in writing or through any other conduct by both parties that acknowledges the existence of a contract

To form a contract, one of the parties must make an offer, the other party must accept the offer, and consideration, or something of value, must be exchanged An offer may be revoked without any loss to the offeror if the revocation

is made before the other party accepts the offer and gives consideration However, an offer may not be revoked for up to 90 days if it is (1) accompanied by an assurance that the offer will be kept open; (2) made by a merchant; and (3) in writing signed by the offering merchant (U.C.C § 2-205)

If a party accepts an offer but in the process

of accepting changes material terms of the offer, the acceptance may be considered a counterof-fer A counteroffer eliminates the first offer, and

no contract is formed until the original offeror accepts the counteroffer and consideration is exchanged In contracts between merchants, additional or different terms by the offeree become part of the contract unless (1) the offer expressly limits acceptance to the terms of the offer; (2) the new terms materially alter the contract; or (3) the offeror objects within a reasonable time

Many basic principles of contract law also apply to the sale of goods TheSTATUTE OF FRAUDS

requires that an agreement to sell goods at $500

or more must be in writing or it cannot be enforced in court The writing must be signed

by the party to be charged, it must contain language indicating that a contract has been made, and it must identify the parties to the contract and the quantity of goods sold There are a few exceptions to the Statute of Frauds

A sales contract that isUNCONSCIONABLE may

be struck down in whole or in part by a court A sale is unconscionable if a person in a superior bargaining position dictates terms that are grossly unfair to the other party A court will determine whether a sale is unconscionable by examining the circumstances at the time the contract was made Courts rarely find uncon-scionability in sales between merchants because merchants generally are more sophisticated in sales negotiations than are non-merchants

Parties to a sale sometimes do not include all the terms of the sale at the time the agreement is made Such omissions will not

destroy the agreement if the parties intend to add terms at a later date If the parties wish to modify an existing sales contract, the modifica-tions should be in writing if they increase the value of the sale to $500 or more

Issues Arising Prior to Performance

Performance is the fulfillment of a promise in the contract Many issues can arise in a sales contract after the contract is made and before a party’s performance is required

Sometimes performance may be made im-practicable If the goods are completely destroyed before the risk of loss has passed to the buyer, and the goods have not been destroyed through the fault of either party, the seller may be excused from performing Risk of loss is responsibility for any damage or destruction of goods; the parties may decide in the contract when the risk of loss

of the goods passes from the seller to the buyer

If the goods are only partially destroyed or have deteriorated, the buyer may demand to inspect the goods and either void the contract or accept the goods with a reduction in the contract price

A seller may avoid performing only if the destroyed goods were specifically identified when the sale was made For instance, if the sale is of a lamp handpicked by the buyer, the destruction of that particular lamp would excuse the seller’s performance, and the seller would not be liable to the buyer for the loss However, if the contract is simply for a lamp of

a specific description, the seller could tender any lamp that meets the description, and the buyer would not be excused from performing There are two situations in which a party must make a substituted performance in case the agreed method of performance becomes impracticable First, when the goods cannot be transported by the agreed-upon method of transportation, the seller must use available transportation that is a commercially reasonable substitute Second, if an agreed-upon method of payment fails, the buyer must use a commer-cially reasonable substitute method of payment

if one is available If a party fails to substitute transportation or payment, that person could be liable to the other party for losses resulting from the failure

In some cases the purpose of a sale may be frustrated by circumstances beyond the control

of both buyer and seller For example, assume

that a party agrees to buy one thousand T-shirts

in anticipation of a local rock concert If the

concert is cancelled after the sales contract is

made, the buyer may escape the contract under

the doctrine of frustration of purpose

At times it may appear to a party that the

other party will be unable to perform by the

expected date For example, assume that a party

agrees to sell goods on credit If the buyer

becomes financially insolvent before the goods

are delivered, the seller may demand cash before

delivering the goods If the goods are in transit,

the seller may instruct the carrier to withhold

delivery of the goods A party is considered

insolvent if he or she cannot pay debts as they

come due, has ceased to pay debts, or has

liabilities that exceed assets

If a party has reasonable grounds to feel

insecure about the other party’s ability to

perform, the insecure party may demand

assurances before performing For example, a

seller may be insecure if a buyer falls behind in

payments, or a buyer may feel insecure if a seller

delivers defective goods to another party and

those goods are of a kind similar to those

expected by the buyer In such cases the

concerned party may demand assurances such

as an advance payment or some other

AFFIRMA-TIVE ACTION, and if the other party does not

provide any assurance, the concerned party may

withhold performance Alternatively, if the

other party gives the assurance, the concerned

party must follow through on his obligations

Precisely what constitutes an effective assurance

is aQUESTION OF FACTthat depends on the nature

of the goods, the size of the contract, the length

of time until performance, and similar

con-siderations In any case a concerned party may

not make commercially unreasonable demands

on a party prior to performance and then

withhold performance if the other party does

not meet the demands

If a party unequivocally declares an

unwill-ingness to perform prior to the time of

performance, the other party may consider the

declaration an anticipatory breach of the sales

contract An anticipatory breach operates in the

same way as an actual breach and gives the

non-breaching party the right to sue for losses

resulting from the breach A refusal to give

assurances after a demand for assurances may

be considered an anticipatory breach A party

may retract a repudiation if the retraction is

made before the aggrieved party cancels the contract

Seller’s Obligations

Generally, the seller’s primary obligations are to transfer ownership of the goods and deliver the goods A seller may agree with the buyer to perform other obligations For instance, a seller may agree to package or label the goods in a certain way or service the goods for a specific period of time

A seller should convey the title to the goods free from any security interest or other lien or claim, unless the buyer was aware at the time of the sale that other persons had a claim to the goods If the sales contract does not specify a time of delivery, the seller should deliver the goods within a reasonable time after the contract is made Delivery should occur in one shipment unless the parties agree otherwise If the sales agreement does not indicate where the goods are to be turned over, the delivery of the goods should occur at the seller’s place of business The tender of the goods should be at a reasonable hour of the day, and the buyer should have the ability to take the goods away

If the goods are in the possession of a third party, or bailee, at the time of the sale, the seller must arrange matters with the bailee so that the buyer may take possession If the goods are to

be transported, there are two ways to handle delivery The buyer and seller may agree to a shipment contract, in which case the seller must arrange for the transportation In a shipment contract, the seller’s duties for delivery are complete as soon as the goods are delivered to the carrier With a destination contract, the seller’s obligation to deliver does not end until the goods are delivered to the buyer or at a selected location

Warranties

In the context of the sale of goods, aWARRANTYis concerned with identifying the kind and quality

of the goods that are tendered by the seller The two basic types of warranties are express warranties and implied warranties

An express warranty is any representation or affirmation about the goods made by the seller’s words or conduct For example, the description

of the goods in the sales contract constitutes an express warranty that the goods will conform to the description

Implied warranties are warranties that are imposed on sellers by law A warranty of merchantability is implied in every sales con-tract This warranty is a promise that the goods pass without objection in the trade, are adequately packaged, conform to all promises

or affirmations of fact on the container, and are fit for the ordinary purposes for which such goods are used The IMPLIED WARRANTY of merchantability also includes a promise that multiple goods will be of even kind and quality

Another implied warranty recognized by courts is the warranty of fitness for a particular purpose This warranty requires that goods be fit for an identifiable, particular purpose It is effective only if the seller has reason to know of any particular purpose for which the goods are required and also knows that the buyer is relying on the seller’s expertise to select suitable goods

Some sellers attempt to disavow any responsibility for the quality of their merchan-dise Sellers may not disclaim the warranty of merchantability unless they use the word

“merchantability” in the disclaimer, which may be oral or written If written, the disclaimer clause or term must be conspicuous The implied warranty of fitness for a particular purpose may be disclaimed in writing, but it cannot be disclaimed orally In some states, statutes or court decisions prohibit the dis-claimer of warranties in consumer sales

If a seller fails to tender goods, the buyer may choose one of three remedies First, the buyer may seek damages from the seller

Damages are the total financial losses resulting from the failure to tender Generally, damages for non-delivery consist of the market price of the goods minus the sale price Market price is figured by determining the market price at the time the buyer learned of the breach at the place the tender was to have been made

Second, the buyer may cover or purchase similar goods elsewhere and then recover for losses resulting from the purchase If the purchase price of replacement goods is greater than the original sale price, the buyer may recover the difference from the seller The buyer must cover inGOOD FAITH, without delay, and on reasonable terms When a seller is unable to perform a sale as agreed, the buyer should try to minimize his or her damages by covering the loss If an aggrieved buyer fails to make

reasonable efforts to cover, a court may reduce any damage award to account for the failure Third, a buyer may force the seller to per-form by taking the seller to court and obtaining

an order forSPECIFIC PERFORMANCEor maintaining

an action for REPLEVIN An action for specific performance may be ordered if the goods are unique and in other proper circumstances Goods may be considered unique if the buyer

is unable to find the goods elsewhere An action for replevin is a method of recovering goods that

is similar to specific performance Replevin is allowed where the goods are specifically identi-fied in the contract and the buyer is unable to cover the goods after a reasonable effort, or the circumstances indicate that the buyer will be unable to cover If a buyer has paid only part of the sale price and the seller becomes financially insolvent within ten days of the first payment and is unable to tender the goods, the buyer may pay any remaining balance and sue to obtain the goods This would give the buyer the goods and prevent the seller from using the goods to pay other debts

If the buyer elects to collect damages after covering or damages for non-delivery, the buyer may collect additional damages called incidental damages and consequential damages Incidental damages are those resulting from the seller’s breach These include expenses incurred in inspection, receipt, transportation, care, and custody of goods rightfully rejected; any com-mercially reasonable charges or expenses in-curred in covering; and any other reasonable expense incident to a delay in tender of the goods or other breach on the part of the seller Consequential damages include any loss that results from requirements of which the seller is aware at the time of contracting and that could not have been prevented by cover or other method, and foreseeable and avoidable injuries

to persons or property resulting from a breach

of warranty

In some cases the buyer and seller may agree

in the sales contract to LIQUIDATED DAMAGES Generally, a liquidated damages clause is placed into a sales contract to fix damages at a certain amount in case a party is unable to perform A court may strike down a liquidated damages clause if it does not bear a reasonable relation-ship to actual damages or anticipated damages

If a seller tenders nonconforming goods, or goods that do not meet the specifications in the

sales contract, the tender constitutes a breach of

the contract In such a situation, the buyer may

either accept or reject the goods Any recovery

by the buyer will depend on whether the buyer

accepts or rejects the goods

A buyer has the right to inspect goods

before accepting them If the goods are

non-conforming, the buyer may accept the goods

and recover from the seller the difference

between the value of the goods as warranted

and their actual value with the defects

A buyer may elect to reject nonconforming

goods To reject goods, the buyer must take

some positive action to give the seller notice of

the rejection If the seller can cure the problem,

the buyer should tell the seller why he or she is

rejecting the goods or risk a reduction in

damages In transactions between merchants, a

buyer should specify the problem to the seller if

the seller makes a written request for a full and

final written statement of all defects on which

the buyer bases the rejection

A seller has the right to cure nonconforming

goods if he gives notice to the buyer and if

conforming goods can be delivered before the

last date for delivery under the sales contract In

any case a buyer may agree to extend the time

for delivery of conforming goods In some cases

a buyer may have no choice Under section 2–

508(2) of the UCC, if a seller sends

non-conforming goods that he reasonably believed

would be acceptable, the seller has additional

time to deliver conforming goods if he gives

notice of such intent to the buyer

If a buyer rejects goods, the buyer may not

exercise any ownership over the goods The

buyer must hold the goods for a reasonable time

and permit the seller to remove them or await

instructions from the seller If the seller issues

instructions to the buyer, the buyer should

follow any reasonable requests For example, if

the goods are perishable and the seller has no

local agent, the buyer should attempt to sell the

goods for the account of the seller The buyer

then could recover the difference between the

amount that the buyer could have made with

the goods and the amount that the buyer

actually received

If the buyer rejects nonconforming,

non-perishable goods and the seller has no agent

near the buyer, the buyer should follow

instructions from the seller If the seller issues

no instructions, the buyer may either store the

goods for the seller’s account, reship the goods

to the seller, or sell the goods for the seller’s account An aggrieved buyer may then recover any losses incurred in storing, shipping, or reselling the goods

If a buyer rejects nonconforming goods and cannot sell them, the buyer may hold the goods for the seller and recover the difference between the market price of the goods as warranted and the value of the goods as delivered A buyer also may ask for specific performance If the seller is unable to provide the goods as requested, the buyer may recover any money already paid toward the sale plus any consequential or incidental damages resulting from the breach

Buyer’s Obligations

A buyer’s basic obligations are to accept the goods and pay the sale price If the goods are nonconforming, the buyer may reject the goods

If the goods conform to the specifications of the sales contract and the buyer wrongfully rejects them, the seller may choose one of four options,

or a blend of two or more options

First, the seller may sue for damages The amount of damages for a wrongful rejection would be the sale price minus the market price

of the goods, measured at the time and place of the tender Second, the seller may sue for the price of the goods, but only if the goods cannot

be resold in the seller’s ordinary course of business or if circumstances indicate that resale efforts will be fruitless Third, the seller could cancel the contract, putting an end to shipments and reserving the right to sue for damages or collect unpaid balances Fourth, the seller could resell the goods to a third party and recover the difference between the sale price and the resale price plus any incidental damages

The resale of wrongfully rejected goods presents a few special problems Under section 2–706 of the UCC, the sale may be either public

or private A private sale is made personally by the seller, whereas a public sale is made with public notice and carried out by a sheriff or at a publicly held auction In either case the sale must be commercially reasonable in method, manner, time, place, and terms Furthermore, the seller must notify new buyers that the goods are being resold under a breached contract to disclose the potential for legal conflict

A seller who resells wrongfully rejected goods must inform the original buyer of the

resale If wrongfully rejected goods are perish-able, the seller need not give notice to the buyer

of the time and place of the resale If the resale of wrongfully rejected goods is at a public sale, only goods identified in the contract may

be sold, and the sale must be made at a usual place for public sale, provided that such a site is reasonably available If the goods are not in view

of bidders at a public sale, the public notice of the sale must state the place where the goods are located, and the seller must give bidders an opportunity to inspect the goods If the seller resells the goods for a price higher than the price in the original sales contract and the extra profit covers costs incident to the resale, the seller has no damages, and the original buyer

is not liable to the seller for the wrongful rejection

In sales where the buyer pays a deposit and then wrongfully rejects the goods, the seller may keep the goods and the deposit However, a seller is not entitled to a deposit that far exceeds his or her actual or expected damages Under section 2–718 of the UCC, a buyer is entitled to restitution of any amount by which the sum

of the payments already made exceeds either (1) the amount of any reasonable liquidated damages clause, or (2) 20 percent of the value of the total performance for which the buyer is obligated under the contract, or $500, which-ever amount is smaller

When a buyer accepts a seller’s tender of conforming goods, the buyer is obligated to pay the sale price contained in the contract for sale

In some cases the parties may fail to agree to a price or choose to leave the price terms open

Under section 2–305 of the UCC, if a price term

is left open, the price should be set in good faith

at a reasonable market price at the time of delivery If the parties intend that there is to be

no contract unless a price is agreed to or fixed

by a particular market indicator and the parties ultimately are unable to agree to a price term, there is no contract In such a case the buyer must return any goods received, and the seller must return any money paid by the buyer

Generally, a buyer has the right to pay in any manner observed in the business unless the seller demands a particular form of payment

Unless the parties agree otherwise, payment should be made when the goods are delivered to the buyer A buyer does not have the right to inspect the goods if they are delivered cash on

delivery or on similar terms, or if the contract provides for payment before inspection

Installment Contracts

Installment contracts have a few of their own special rules An installment contract calls for periodic performances over a length of time The parties may agree to make payments in any way, but if the sale price can be divided, the buyer usually makes payments on installment contracts upon each delivery of goods

Buyers in installment sales do not have the same full rights of rejection as buyers in other sales If a seller tenders an installment of nonconforming goods, the buyer may reject the installment only if it substantially impairs the value of that installment and cannot be cured Under section 2–612 of the UCC, if the nonconformity is not substantial and can be cured by the seller, the buyer must accept a nonconforming installment and sue for damages

The tender of one nonconforming install-ment in an installinstall-ment contract for sale does not always constitute a total breach of the entire installment contract Generally, a non-breaching party to an installment contract may cancel the contract only when a breach or cumulative breaches substantially impair the value of the entire contract

The NCCUSL and the ALI began work in the late 1980s on a revision to Article 2 of the UCC Work on the project seemed to be finished in 1999, when the ALI approved what

it thought was the final draft of the revision However, opposition from certain important industries, including software manufacturers, led to the withdrawal of the revision It was feared that many states would refuse to adopt the changes because of this opposition The controversy surrounding the revision has centered on software, downloadable infor-mation and “smart goods.” These types of goods, which include cars, refrigerators, and other appliances, use computer programs to enhance their performance By 2002 the draf-ters’ latest revision excluded “information” from the definition of goods, thus removing the downloading of electronic information from the reach of the Article However, the comment section to the draft noted that Article 2 would cover the sale of smart goods, even though these goods include computer programs

After years of work, the NCCUSL and ALI

in May of 2003 adopted the revised version of

Article 2 After its final review, which was

completed in 2003, the revised Article 2 was

sent to the states for their considerations in

adopting the revised version No states have

adopted the revision

FURTHER READINGS

American Law Institute Available online at www.ali.org

(accessed January 28, 2010).

National Conference of Commissioners on Uniform State

Laws Available online at www.nccusl.org (accessed

January 28, 2010).

White, James J and Robert S Summers 2009 Principles of

Sales Law 1st ed St Paul, Minn.: West.

CROSS REFERENCES

Carriers; Consumer Protection; Model Acts; Product

Liability; Shipping Law.

SALES TAX

A state or local-level tax on the retail sale of

specified property or services It is a percentage of

the cost of such Generally, the purchaser pays the

tax but the seller collects it as an agent for the

government Various taxing jurisdictions allow

exemptions for purchases of specified items,

including certain foods, services, and

manufactur-ing equipment If the purchaser and seller are in

different states, a use tax usually applies

The vast majority of states impose sales

taxes on their residents The only exceptions are

Alaska, Delaware, Montana, New Hampshire,

and Oregon Some states rely more heavily on

sales taxes for a significant portion of revenue

Tennessee, for instance, does not impose an

INCOME TAX, so it relies heavily on sales taxes

The combined state and local sales taxes average

about 9.25 percent per sale The state of

Michigan imposes a six percent sales tax, which

accounts for about 28 percent of the state’s total

revenue In 2002, the state collected $6.5 billion

in sales taxes

States have faced a long struggle to collect

sales and taxes from retailers that are based

outside the state and have no contacts with the

state seeking to collect taxes This is particularly

true of companies that sell goods through mail

orders or on the INTERNET Even if an

out-of-state retailer is not required to pay sales taxes

within a state, the purchaser is nevertheless

required to pay the sales tax on goods and

services purchased through the Internet or by

mail order However, states rarely collect these

taxes from the purchasers According to a study

by researchers at the University of Tennessee, states and cities in the United States lost an estimated $13.3 billion in uncollected sales taxes

in 2001

The U.S Supreme Court has addressed the issue of states requiring out-of-state retailers to pay sales taxes on several occasions In Complete Auto Transit, Inc v Brady, 430 U.S 274, 97 S

Ct 1076, 51 L Ed 2d 326 (1977), the Court required a showing of a “substantial nexus”

between a taxing state and the company providing goods and services before the taxing state can require the company to pay taxes

Without this substantial nexus, a state that taxes

an out-of-state retailer has violated the COM-MERCE CLAUSEof the U.S Constitution

Subsequently, the Court applied this test to a case involving a state’s attempt to tax a mail order company Quill Corp v North Dakota, 504 U.S

298, 112 S Ct 1904, 119 L Ed 2d 91 (1992) In Quill Corp., the state of North Dakota sought a

DECLARATORY JUDGMENT that Quill Corporation, which had is main offices in Illinois, California, and Georgia, was required to pay taxes on sales with North Dakota customers Quill had no outlets or any sales representatives in North Dakota, though it received $1 million of its annual $200 million in sales nationally from the state The Court held that North Dakota could not tax Quill because Quill did not have a substantial nexus with the state

In order to address the problems associated with the collection of sales taxes on the Internet, the National Governors Association drafted the Streamlined Sales and Use Tax Agreement, whereby states would agree to modify their sales and use tax laws to a more uniform structure

Thirty-one state representatives signed the agree-ment, though individual state legislatures would have to modify their tax statutes to conform The agreement is designed to remove complications among the sales and use tax laws in the different states and to eliminate the potential for double taxation Several commentators, however, have noted that such an arrangement could violate the Commerce Clause based on the decisions in Quill Corp., Brady, and similar cases

FURTHER READINGS Chi, Keon S 2000 Electronic Commerce: Revenue Implica-tions for States Lexington, Ky.: Council of State Governments.

Chriqui, Jamie and Shelby Eidson 2008 “State Sales Tax Rates for Soft Drinks and Snacks Sold through Grocery Stores and Vending Machines.” Journal of Public Health Policy 29.

Due, John Fitzgerald 1994 Sales Taxation: State and Local Structure and Administration 2d ed Washington, D.C.:

Urban Institute Press.

Murray, Matthew N., and William F Fox, eds 1997 The Sales Tax in the 21st Century Westport, Conn.: Praeger.

CROSS REFERENCE Taxation.

SALT SeeARMS CONTROL AND DISARMAMENT

SALVAGE The portion of goods or property that has been saved or remains after some type of casualty, such

as a fire

The term salvage is defined more specifically depending on the industry referring to it In business, salvage is any property that is no longer useful but has scrap value An example of business salvage is obsolete equipment In insurance, salvage is the portion of property that the insurance company takes after paying the claim for the loss The insurance company may deduct the salvage value from the amount

of the claim paid and leave the property with the insured In ADMIRALTY or maritime law, salvage is the compensation allowed to persons who voluntarily save a ship or its cargo from impending danger In addition to compensa-tion, maritime salvage may be property that is recovered from vessels that were shipwrecked, derelict, or recaptured Salvage as a legal concept typically concerns maritime salvage

To establish a valid salvage claim under maritime law, the claimant must prove the following: the salvage was needed because of a marine peril; the claimant’s service was ren-dered voluntarily and not because of an existing duty or contract; and the claimant’s service contributed to the success of the salvage in whole or in part

The element of peril is an important, yet misunderstood, element The maritime inter-pretation of peril is broad and liberal Imminent and absolute danger is not a requirement for maritime peril If the property is in danger, or stranded“so that it [is] subject to the potential danger of damage or destruction,” then peril exists (McNabb v O S Bowfin, 565 F Supp 22

[W.D Wash 1983]) Also, the degree of peril does not determine whether the salvor will

be entitled to a salvage award, but it will be considered in determining the amount of the award According to the admiralty law of the United States, a stranded vessel that may

be exposed to wind, weather, and waves is considered to be in a position where it may be destroyed and is therefore in peril

A wide variety of services can support a claim for a salvage award For example, a claim for salvage has been granted where the salvor provided assistance in putting out a fire when the fire was not under immediate control A salvage service claim may even succeed where the salvor assisted in putting out a nearby fire that had the potential to endanger the vessel Voluntarily towing a drifting vessel to safety has also supported a claim for salvage award, even where the drifting vessel was not in danger

of immediate or absolute harm and apprehen-sion of danger was minimal Along the same lines, towing a stranded vessel has also consti-tuted salvage service In the towing situation, courts have held that although there is no apprehension of immediate harm or danger, a stranded vessel is subject to high winds and other severe weather, placing the vessel in peril Courts have also upheld a salvage service claim when the crew, master, or officers were incapacitated, and when the vessel was exposed

to a hazard of the sea as a result of its master’s uncertainty

In all situations of salvage service, the service must be entirely voluntary The salvor cannot have provided the service pursuant to any type of contract or agreement or other existing duty When the U.S Navy or Coast Guard provided the salvage service, the issue as

to whether those services were in fact voluntary has arisen

When the Navy performs the salvage service, courts have held that, because salvage

is not one of the functions of the Navy, any assistance provided by the Navy is voluntary, regardless of whether the Navy is in the area where the salvaged vessel is in peril Federal law now provides that “the Secretary of Navy may settle any claim by the United States for salvage services rendered by the Department of Navy and may receive payment of any such claim” (10 U.S.C.A § 7363 [1996])

Similar claims by the Coast Guard have had

different outcomes According to statute, the

Coast Guard may “perform any and all acts

necessary to rescue and aid persons and protect

and save property” (14 U.S.C.A § 88 [1996])

Most courts and commentators have interpreted

this language as creating a legal duty Therefore,

under this interpretation the government would

not have a right to a salvage award for services

rendered by the Coast Guard The Fifth Circuit

Court of Appeals declined to follow this

interpretation in the case of United States v

American Oil, 417 F.2d 164 (1969) In its

decision, the court held that the Coast Guard

did not have a preexisting duty to perform

salvage services and that the statutory language

defining the Coast Guard’s duties was

permis-sive Although the Fifth Circuit Court of Appeals

may allow the United States to recover salvage

awards for services rendered by the Coast Guard,

other courts have declined to follow this

interpretation, leaving the right of the

govern-ment to recover salvage awards for services

rendered by the Coast Guard still under debate

The salvage service rendered must also have

been successful, either in whole or in part

Furthermore, the salvor must have contributed

to the success The salvor, however, does not

have a right to force his or her services on a

distressed vessel The doctrine of rejection

applies when the master of a distressed vessel

directly and unequivocally rejects the salvor’s

services In that situation, the salvor does not

have a right to a salvage award

In determining the amount of the salvage

award, the court will go beyond the value of the

services In 1869 the U.S Supreme Court, in The

Blackwall, 77 U.S (10 Wall.) 1, 19 L Ed 870, set

forth the following criteria in determining the

amount of the award: (1) the labor expended by

the salvors in rendering the salvage service; (2)

the promptitude, skill, and energy displayed in

rendering the service and saving the property;

(3) the value of the property employed by the

salvors in rendering the service and the danger

to which such property was exposed; (4) the risk

incurred by the salvors in securing the property

from the impending peril; (5) the value of the

property saved; and (6) the degree of danger

from which the property was rescued

When a salvage award is granted, all of the

parties who participated in the salvage service will

share in the award based on their participation In

addition, the owner, master, and crew of the salvaged vessel are entitled to share in the award

If the salvaged property is damaged as a result of the salvage effort, the owner may claim that the salvor was negligent If the court finds that the salvor did not adhere to a standard of reasonable care, the salvage award will be reduced depending

on the degree ofNEGLIGENCE

An action for salvage is generally an in rem action This means that the suit is brought against the property saved, such as the ship or its cargo In the event that the property is no longer within the jurisdiction or has been destroyed, an in personam action may be brought to recover the salvage award These salvage actions fall under the jurisdiction of the admiralty courts

Anyone with a direct pecuniary interest in the property salved, such as the owner, may be liable for the salvage award In addition, anyone who may be liable for the property, for instance

a bailee, may also be liable for the salvage award

The persons liable for the salvage award are not necessarily the individuals who requested the salvage services

In the event that the salvage claim involves a shipwreck, the court has“qualified jurisdiction”

when the wreck site is exclusively within the waters of the contiguous zone of the United States In addition, U.S admiralty courts have asserted jurisdiction of wrecks in international waters when certain pieces of the wreck were brought into the jurisdiction of the court

This is based on the “first salvor rule,” which protects the first salvor from losing the“trove”

once it has started salving the wreck to other parties who may intervene and attempt to take over the salvage operations Most countries recognize the right of the first salvor and will uphold a lien issued by another jurisdiction according to this rule

According to the agreement, the convention was to become effective one year after 15 states had expressed their consent to be bound by it

In 1996 the agreement became binding, or entered into force, upon 22 countries

FURTHER READINGS Burstein, Susanne M 2002 “Saving Steel over Souls: The Human Cost of U.S Salvage Law ” Tulane Maritime Law Journal 27 (winter).

Clift, Rhys and Robert Gay 2005 “The Shifting Nature of Salvage Law: A View from a Distance ” Tulane Law Review 79.

Forrest, Craig J.S 2003 “Has the Application of Salvage Law

to Underwater Cultural Heritage Become a Thing of the Past?” Journal of Maritime Law and Commerce 34 (April).

Landrum, Bruce 1989 “Salvage Claims for the Navy and Coast Guard: A Unified Approach.” Naval Law Review

38 (winter).

Morton, C W 1999 Sea Trials New York: St Martin’s.

Neilson, William L 1992 “The 1989 International Conven-tion of Salvage ” Connecticut Law Review 24 (summer).

CROSS REFERENCES Admiralty and Maritime Law; Negligence.

SAME CONDUCT TEST The same conduct test for analyzing DOUBLE JEOPARDY cases under the FIFTH AMENDMENT was established by the SUPREME COURT in Grady v

Corbin (495 U.S 508, 110 S Ct 2084, 109 L Ed

2d 548 [1990]) Under this test, a criminal

DEFENDANT was extended double jeopardy pro-tection beyond the “same elements” test announced in Blockburger v United States (284 U.S 299, 52 S Ct 180, 76 L Ed 306 [1932]) In Blockburger, the Court held that the double jeopardy clause prohibits a subsequent prosecution if the crimes charged in the prior prosecution are identical to or included within the crimes charged in the subsequent prosecu-tion A lesser offense is included within a greater offense if it is established by proof of the same facts which must be proved to establish the greater offense Thus, everyMURDERincludes an

ASSAULT AND BATTERY, but not every murder includes an ASSAULT with a deadly weapon, because possession of a deadly weapon need not

be proved to establish murder This is known as the“same elements” test

In Grady v Corbin, the Court held that an individual could not be prosecuted twice for the same criminal behavior, regardless of the actual evidence introduced during trial or the statutory elements of the offense Therefore, prosecutors had to satisfy both the same elements test and the same conduct test Under the same conduct test, the Court stated that the test is not whether the lesser offense is included within the greater offense, but whether the prosecution, in proving the greater offense, will have to prove conduct that constitutes an offense for which the defendant has already been prosecuted The critical inquiry is what conduct the state will prove, not the evidence the state will use to prove that conduct The same elements test was developed to prevent the imposition of multiple

punishments in a single prosecution Beyond the possibility that the defendant would receive

a stronger sentence by going through multiple prosecutions, the double jeopardy clause would relieve a person of enduring embarrassment, expense, and emotional insecurity Using the same conduct test also prevented the prosecu-tion from rehearsing its presentaprosecu-tion of the evidence, which would increase the risk of an erroneous conviction for one or more of the charges

Courts found the same conduct test confus-ing In 1993, the Supreme Court reversed Grady

in U.S v Dixon (495 U.S 508, 113 S Ct 2849,

125 L Ed 2d 556 [1993]) The Court cited Blockburger’s “deep historical roots” and the fact that Grady lacked “constitutional roots.” In addition, Grady misread “the clear common-law understanding of double jeopardy” upon which the Blockburger test rested The Court also concluded that the same conduct test had

“proved unstable in application” and was a source of confusion The Court returned to the same elements test as the way to analyze double jeopardy claims

FURTHER READINGS LaFave, Wayne, and Jerold Israel 2006 Criminal Procedure: Constitutional Limitations 7th ed St Paul, Minn.: West.

Rudstein, David 2004 Double Jeopardy: A Reference Guide to the United States Constitution New York: Praeger CROSS REFERENCES

Double Jeopardy; Fifth Amendment; Same Elements Test. SAME EVIDENCE TEST

A method used by courts to assess whether a criminal prosecution is barred by the DOUBLE JEOPARDY CLAUSEof theFIFTH AMENDMENTto the U.S Constitution, which guarantees that no individual shall “be subject for the same offense to be twice put

in jeopardy of life or limb.” Under this test, if the evidence required to support a conviction in one crime also would have supported a conviction in another, then double jeopardy exists

SAN FRANCISCO VIGILANCE COMMITTEES OF 1851 AND 1856 The San Francisco Vigilance Committees of 1851 and 1856 were self-appointed law enforcement committees organized to maintain order in San Francisco, California, during the mid-nineteenth century

As a result of the Treaty of Guadalupe

Hidalgo in 1848, which concluded the Mexican

War, the United States acquired a vast territory

in the Southwest, including California and New

Mexico After gold was discovered at Sutter’s

Mill in 1848, thousands of gold hunters flocked

into northern California Many of the gold rush

towns where the immigrants settled had been

little more than villages before the gold rush,

and they lacked the municipal institutions

that were needed to cope with the rapidly

expanding populations Government and law

enforcement became increasingly disorganized

and chaotic, and respect for the RULE OF LAW

disappeared As a result, vigilance committees

were formed in many towns The San Francisco

Vigilance Committees of 1851 and 1856 provide

two of the most famous examples of vigilante

activity

Before gold was discovered in 1848, the

population of San Francisco had been around

800 persons By 1851 nearly 25,000 gold seekers

had arrived, most of whom settled in or near the

city Crime quickly became a problem In 1856

a Sacramento newspaper claimed that there had

been 1,400 murders in San Francisco in the

previous six years and that only three murderers

had been hanged

In 1851 a group of citizens, including a large

number of business people, under the

leader-ship of Sam Brannan, formed the first San

Francisco Vigilance Committee The city

gov-ernment had failed to curb GANGS of outlaws

known as the “Regulators” or “Hounds,” who

preyed upon the inhabitants of the city and were

suspected of having set a series of fires that had

destroyed much of the city The committee

promptly sought out several of the alleged

outlaws and sentenced them to death,

DEPORTA-TION, or whipping

In 1856, after the county supervisor James

P Casey killed newspaper editor James King,

the committee came back into existence

under the leadership of William T Coleman

to combat lawlessness among the general

population and corruption and

mismanage-ment in the city governmismanage-ment The committee

began by trying and executing Casey and

Charles Cora, a notorious criminal Next the

committee barricaded the streets in an area

where the crime rate was high and captured and

punished all the criminals it could find within

the barricades

In the meantime, other citizens, including a number of city officials and attorneys, had formed the“Law and Order” faction to oppose the vigilantes.DAVID SMITH TERRY, a justice of the California Supreme Court, tried to prevent one

of the vigilantes from arresting a certain Reuben Maloney on the grounds that the committee had no legal authority to conduct arrests A fight ensued in which Terry stabbed Sterling A

Hopkins, the vigilante Although Terry was imprisoned for a few weeks, the vigilantes’

attempt to put him on trial failed, and the committee disbanded a short time later By that time, it had lost most of its supporters and its power had waned

Although the committees declared that the safety of the public was their purpose, the committees ignored the principles of govern-ment on all levels Their trials did not follow standard procedures but used only a skeletal version of established legal practices

FURTHER READINGS Gordan, John D., III 1987 Authorized by No Law: The San Francisco Committee of Vigilance of 1856 and the United States Circuit Court for the Districts of California San Francisco: U.S District Court for the Northern District

of California Historical Society.

McDowell, Andrea 2007 “Criminal Law beyond the State:

Popular Trials on the Frontier ” Brigham Young Univ.

Law Review.

Morriss, Andrew P “Hayek & Cowboys: Customary Law in the American West ” NYU Journal of Law & Liberty 1.

Mullen, Kevin J 1989 Let Justice Be Done: Crime and Politics

in Early San Francisco Reno: Univ of Nevada Press.

CROSS REFERENCE Self Help.

Violence ensued when San Francisco Vigilance Committee members attempted to arrest Reuben Maloney in 1856 California Supreme Court Justice David Smith Terry (top hat, center) stabbed to death vigilante Sterling A Hopkins.

CORBIS.