CONSTRUCTIVE TRUSTS & TRACING THROUGH
EXCHANGES
• Direct Exchange - P can trace through direct exchanges (Problem 8-1)
• Exchanges & Commingling
If D commingles P’s stolen cash with his own, P must use the tracing
fictions/presumptions:
1. D spends his own $ first
2. New $ lawfully acquired is Ds unless D manifests intent to replenish P’s $
3. D invests P’s $ first
1 & 3 can be used at P’s election to maximize P’s recovery although can only
use in “real time.” 2 must be used as it is stated.

Use of these presumptions with the ledger system will illustrate the lowest
intermediate balance rule (without consciously applying it)

Lowest Intermediate Balance Rule – If total balance of account falls below
the value of the stolen item deposited in the account, the lowest balance
prior to the next deposit of P’s $ (or an adjudication) limits what P can get for
that particular property
FACTS COMMON TO ALL TRACING PROBLEMS
• Scum manages a trust fund for his mother which contains the
following:
• 100 shares Microsoft at $30/share
• 100 shares of Exxon at $50/share
• 100 shares of Walmart at $60/share
• Scum embezzles from Mom in each problem so we know that there are
GROUNDS for a constructive trust. The key is to find out whether there is an
identifiable asset.
• Scum maintains his own checking account which, at the beginning of each
problem, has $10,000 in it.
• Due to financial difficulties, after the actions identified in each problem, Scum
eventually goes bankrupt making a damage judgment essentially not worth
it.
• Each transaction in each problem occurs in chronological order on a different
day with the balance immediately being recorded.
DRAFTING INJUNCTIONS
• FRCP 65(d) and state analogs - Contents and Scope
of Injunctions
• (1) Contents. Every order granting an injunction
and every restraining order must:
• (A) state the reasons why it issued;
• (B) state its terms specifically; and
• (C) describe in reasonable detail—and not by referring to
the complaint or other document—the act or acts
restrained or required.
STATING REASONS WHY THE INJUNCTION ISSUED
• How specifically must reasons for the orders be stated?
following good enough?
Is the
• Based on the facts adduced at trial, the actions of Monroe and
Citizen’s for life continue to constitute trespass and harassment.
• No. Although it gives notice of the laws violated it gives the reader no
idea of the actions that violated the law.
• What facts regarding D’s actions would you want in the injunction?
• Key: want enough facts to show the injunction is warranted and not
too intrusive
• Note – a complete list of everything that happened is not necessary.
Only need facts relevant to injunction. But some additional facts may
be helpful to show culpability, etc. and to strengthen court’s decision to
issue injunction of particular breadth
STATING REASONS – IN THE CONTEXT OF THE
PROJECT 2
• Here – judge wants permanent order to be broader than the
preliminary order – thinks former hasn’t worked
• At very least need to state:
• D’s committing trespass; harassment by … (minimal facts on early stuff
needed here)
• Earlier order requiring D’s to do X didn’t work
• P’s continued to thwart spirit of order/law by doing the following things
• List them
• The point of all this is to set the stage for an order that goes
beyond the original order and possibly beyond the four corners of
harassment/trespass law if that’s where your orders went
• Need to have enough facts to support order as a general rule but here
need enough facts to support prophylactic order.
ADDITIONAL ISSUES RE REQUIREMENT OF
“REASONS” IN ORDERS
• Ripeness & Irreparable Injury
• Somewhere in your findings, indicate that the injunction is
warranted because P has suffered irreparable injury and, if it is a
preventive injunction, that the action is ripe.
• The injunction need not be detailed on this point; much of that detail
would have been covered at trial or stated in the opinion. You just want
it stated.
• Statement that D’s actions violate the law.
• This seems obvious but, in addition to setting forth D’s actions,
indicate that they violate specific statutes or constitute a tort, or
are necessary to ensure those violations don’t occur. There is no
basis for an injunction if there is no law violation.
THE ACTUAL ORDER – AVOIDING PITFALLS
• What does plaintiff want here?
• Wants Ds to stop harassing and trespassing – directly or indirectly.
• Would it be enough for injunction to state:
• Monroe/Citizens for Life are barred from entering ReproHealth’s property
located at 123 Broadway without ReproHealth’s permission.
• Probably not:
• This is perilously close to an “obey the law” provision
• Also possibly overly broad/vague
• what if they “negligently” enter – trespass law only prohibits knowing
trespasses
• Bars even entries by individuals seeking health services or other nonprotest reasons without explicit permission – is that necessary?
• Better to describe prohibited acts with specificity
THE ORDER – SOME POSSIBLE PROVISIONS (TAKEN
FROM YOUR ANSWERS)
• Repeat ban on harassment & trespass in original order – worth saying
again; don’t want to incorporate by reference; it should be the basis
around which anything else is built. Then get specific if think
necessary:
• No actual obstruction of P’s driveways/entrances
• No attempts to block driveways by intentionally walking slowing or milling
about in large groups of protestors
• No following clinic clients onto property in order to counsel, hand literature
or other objects, etc.
• No approaching clinic clients while in their cars (either on property on
directly on street in a manner to block traffic)
• Creation of buffer zone 10-30 feet around driveway entrances where
protestors & counselors cannot operate [unless in groups of 4 or less]
• Cease & desist provision requiring counselors to stop if asked
• No creation of loud sounds that can be heard within confines of clinic