USING THE I-R-A-C STRUCTURE IN WRITING EXAM ANSWERS The IRAC method is a framework for organizing your answer to a business law essay question. The basic structure is: Issue, Rule, Analysis, and Conclusion. Using this simple framework for structuring your answer will ensure that you have written a complete answer. Issue Begin your answer by stating the issue presented by the essay question. Sometimes the question will provide the issue for you. If not, then ask: What is the legal question that, when answered, determines the result of the case? The issue should be stated in the form of a question in a specific, rather than general form: \"Is there an agency relationship if there was no compensation paid?\" would be an acceptable issue. \"Will the plaintiff win?\" would not be acceptable. Note that the issue may be case specific, mentioning the parties' names and specific facts of the case. Example: \"Did Jones have an agency relationship with XYZ Corp. due to his acting on behalf of XYZ and following its instructions?\" The issue can encompass all cases which present a similar question. Example: \"Is an agency created whenever there is an employment relationship?\" Most cases present one issue. If there is more than one issue to address, then you must write a separate IRAC analysis for each issue. Rule The rule describes which law or test applies to the issue. The rule should be stated as a general principal, and not a conclusion to the particular case being briefed. Example: \"An agency relationship is created when there is an agreement that the agent will act for the benefit of the principal at the principal's direction or control regardless of whether compensation is paid\" would be an acceptable rule. \"The plaintiff was the defendant's agent\" would not be an acceptable rule. Do not use parties' names or specific facts from the case. Hint: Frequently, the rule will be the definition of the principle of law applicable in the case. Example: An agent may not use or disclose confidential information acquired through the agency absent an agreement to the contrary. Analysis The analysis is the most important, and the longest, part of your answer. It involves applying the Rule to the facts of the problem or question. You should use the facts to explain how the rule leads to the conclusion. Discuss both sides of the case when possible. Important: Do not merely state a conclusion without also stating reasons for it. A conclusion without reasons or explanation means that you have not used the rule and the facts to analyze the issue. Hint: The rule can be used as a guide in your discussion. Example: Suppose the issue is whether A is an independent contractor. Using the facts of the case, explain whether or not they fit into the definition of what is an independent contractor: \"In this case, A was told by the foreman what to wear, how to operate the machine, and when to report to work each day, giving her little control over the job.\" If the rule is a test with multiple factors, then you must analyze each factor by pointing out how the facts do (or do not) fulfill each factor. Conclusion The conclusion is your answer to the Issue. State the result of your analysis. Examples: \"Smith is liable for negligence\" or \"Therefore, no valid contract was formed between X and Y.\" If there are multiple issues, there must be multiple conclusions as well. SAMPLE IRAC ANALYSIS Caroline was employed as a receptionist for ABC Corporation. Her desk was located at the entrance of the corporate office and her duties were to greet customers, answer telephone calls, sort mail, and respond to general requests for information about ABC. One day, while all of the managers of ABC were out of the office, a representative of XYZ Insurance Co. stopped by to solicit ABC as a new client. He told Caroline that he wanted to find out whether ABC might be interested in canceling its present employee health insurance plan and adopting a plan provided by XYZ. Although Caroline explained that none of the ABC managers were in the office, the XYZ representative nevertheless described his company's health insurance plan in detail. When Caroline reacted by stating that XYZ's plan sounded better than the current ABC plan, the XYZ representative immediately produced a contract for Caroline to sign. Reluctantly, Caroline signed the contract accepting the offer to adopt XYZ's insurance plan. If XYZ seeks to enforce the contract against ABC, is ABC bound to the contract? ANSWER EXPLANATION Whether the insurance contract is binding on ABC Corp. depends on whether A had actual or apparent authority to enter into it. Actual authority is the agent's power or responsibility expressly or impliedly communicated by the principal to the agent. Express actual authority includes the instructions and directions from the principal, while implied actual authority is the agent's ability to do whatever is reasonable to assume that the principal wanted the agent to do to carry out his or her express actual authority. Here, Caroline's express authority was to answer phones, direct messages, collect and sort the daily mail, greet visitors, and schedule appointments for the company managers. Her implied authority was to do anything reasonably related to performing those duties. She was not given any express authority to sign contracts, and signing contracts was not related to or implied in her duties as a receptionist. Therefore, Caroline had no actual authority to bind ABC to the contract. First, the main issues to be addressed are stated. Apparent authority arises when the principal's conduct, past dealings, or communications cause a third party to reasonably believe that the agent is authorized to act or do something. In this case, ABC did not communicate to XYZ that Caroline had authority to enter into an insurance contract, and no facts suggest that ABC and XYZ had done business in the past. The nature and typical responsibilities of Caroline's position as a receptionist does not make it reasonable for the XYZ representative to conclude that she was empowered to select and approve health insurance plans for ABC's employees. Thus, Caroline had no apparent authority to authorize the contract. Because Caroline did not have either actual or apparent authority to sign the contract, it is not binding on ABC Corp. The general rule of law to be applied in analyzing the next issue is stated. Next, the applicable rules of law or legal tests to be used in analyzing the issue are explained. The rule of law or legal test is applied to the facts. Note that the facts are not merely repeated; rather, they are linked to elements of the rule or test as evidence to explain and justify the ultimate conclusion that there is no actual authority. Conclusion as to the first issue. The rule is applied to the facts. Note that the facts mentioned are those that relate to the definition of apparent authority. Conclusion for the second issue. An overall conclusion is reached as to the issue of liability. 23 P.2d 35 FOR EDUCATIONAL USE ONLY 132 Cal.App. 454, 23 P.2d 35 (Cite as: 132 Cal.App. 454, 23 P.2d 35) District Court of Appeal, Third District, California. PATTERSON v. CLIFFORD F. REID, INC., ET AL. Appeal from Superior Court, Los Angeles County; Harry R. Archbald, Judge. Action by Annie L. Patterson against Clifford F. Reid, Incorporated, and another. From a judgment in favor of plaintiff, defendants appeal. Affirmed. West Headnotes 16(1) 400 Vendor and Purchaser 400I Requisites and Validity of Contract 400k16 Offer to Sell, and Acceptance Thereof 400k16(1) k. In general. Most Cited Cases Where prospective purchaser signed land contract and other instruments on printed form with material portions left blank, and it was agreed instruments would not become effective until purchaser gave approval, and purchaser subsequently communicated intention not to purchase, there was no contract; there being no acceptance or meeting of minds. Civ.Code, 1585. [2] Contracts 95 16 95 Contracts 95I Requisites and Validity 95I(B) Parties, Proposals, and Acceptance 95k16 k. Offer and acceptance in general. Most Cited Cases To make contract, there must be express or implied offer which must be accepted according to its tenor. West's Ann.Civ.Code 1585. Civ. 4882. June 6, 1933. [1] Vendor and Purchaser 400 Page 1 [3] Contracts 95 22(1) 95 Contracts 95I Requisites and Validity 95I(B) Parties, Proposals, and Acceptance 95k22 Acceptance of Offer and Communication Thereof 95k22(1) k. In general. Most Cited Cases Intention to accept offer must be expressed in positive terms. West's Ann.Civ.Code, 1585. [4] Contracts 95 39 95 Contracts 95I Requisites and Validity 95I(C) Formal Requisites 95k39 k. Incomplete instruments. Most Cited Cases Writing is incomplete as agreement, where blanks as to essential matters are left therein. [5] Cancellation of Instruments 69 69 Cancellation of Instruments 2014 Thomson Reuters. No Claim to Orig. US Gov. Works. 4 23 P.2d 35 FOR EDUCATIONAL USE ONLY 132 Cal.App. 454, 23 P.2d 35 (Cite as: 132 Cal.App. 454, 23 P.2d 35) 69I Right of Action and Defenses 69k2 Right to Cancellation 69k4 k. Invalidity of instrument. Most Cited Cases Where signed land contract never became valid contract, and note and trust deed executed by prospective purchaser on own property were allegedly sold to innocent third party, prospective purchaser held entitled to bring equitable suit for cancellation of contract and recovery of amount of note. Civ.Code, 3412. [6] Cancellation of Instruments 69 37(5) 69 Cancellation of Instruments 69II Proceedings and Relief 69k36 Pleading 69k37 Bill, Complaint, or Petition 69k37(5) k. Averment of ground of cancellation in general. Most Cited Cases Prospective purchaser's complaint alleging facts showing signed land contract was never valid, and alleging that defendant sold plaintiff's note and trust deed to innocent third party, held to state cause of action for cancellation of contract, though not alleging reasonable apprehension of serious injury. Civ.Code, 3412. [7] Courts 106 Page 2 Prospective purchaser's suit for cancellation of signed land contract which never became valid, and for recovery of $900, amount of note and trust deed of plaintiff sold to third party, held properly brought in superior court; municipal court having no jurisdiction because relief sought under statute was equitable. Civ.Code, 3412; Const. art. 6, 11. [8] Cancellation of Instruments 69 24(1) 69 Cancellation of Instruments 69I Right of Action and Defenses 69k19 Conditions Precedent 69k24 Restoration of Consideration or Benefit 69k24(1) k. In general. Most Cited Cases In suit to cancel signed land contract which never became valid, brought under statute authorizing cancellation of instrument in respect to which there is reasonable apprehension that it might cause serious injury if left outstanding, statute requiring party rescinding to do so promptly and restore property received held inapplicable. Civ.Code, 1691, subds. 1, 2; and 3412. **36 *455 Gibson, Dunn & Crutcher, of Los Angeles (Robert F. Schwarz, of Los Angeles, of counsel), for appellants. 472.6 106 Courts 106VII Concurrent and Conflicting Jurisdiction 106VII(A) Courts of Same State 106VII(A)1 In General 106k472 Exclusive or Concurrent Jurisdiction 106k472.6 k. Municipal or other city courts. Most Cited Cases (Formerly 106k472(6)) Marshall Stimson and Noel Edwards, both of Los Angeles, for respondent. TUTTLE, Justice pro tem., delivered the opinion of the court. This action was brought to cancel a written instrument and to recover the sum of $900. This relief was granted, and defendants appeal from the judgment. The complaint alleged and the trial court found 2014 Thomson Reuters. No Claim to Orig. US Gov. Works. 23 P.2d 35 FOR EDUCATIONAL USE ONLY 132 Cal.App. 454, 23 P.2d 35 (Cite as: 132 Cal.App. 454, 23 P.2d 35) the following facts: That defendant bank, through its agent defendant Reid, negotiated for the sale of a lot to plaintiff, who was a widow without previous experience in business matters and especially in relation to the execution of deeds of trust; that as a result plaintiff signed a contract for the purchase of said lot for the sum of $3,725, payable $900 down and the balance in monthly installments; that the agreement and the note and the deed of trust were on printed forms, and when plaintiff signed these documents, the date, description of the property, and amount and terms of payment were not filled in; that the deed of trust covered real property owned by plaintiff, and it was represented to plaintiff by Reid that it would be accepted as the first payment on the purchase price; that after signing these documents, plaintiff informed Reid that she would consider the matter; that plaintiff did not accept the agreement; that Reid stated to her that unless she accepted said offer, the papers signed by her would not be used, but would be returned to her; that three or four days later plaintiff informed Reid that she did not intend to accept the offer and for them not to go ahead with the transaction; that falsely and fraudulently and in contravention to its said agreement with plaintiff, defendant Reid caused the blanks in said papers to be filled in and the agreement to be signed by defendant bank, and caused the note and trust deed to be sold for the sum of $900 to an innocent purchaser, who now holds the same and *456 threatens to cause the same to be foreclosed, and that plaintiff has been obliged to pay the interest on said trust deed; that plaintiff was induced to sign said documents through the false and fraudulent representations of defendant Reid, the agent of defendant bank. [1][2][3][4] It is at once apparent that the purported agreement of sale is not a contract as plaintiff never accepted the offer of defendant bank. There must be an offer expressed or implied and this offer must be accepted according to its tenor, before a binding contract is formed. \"The intention to accept Page 3 must be expressed in positive terms. Thus a statement by the offeree that he would think over the matter, or that he would like to accept, or a promise to 'take up the matter' at a later time or that he would see what he could do and give notice later, are none of them equivalent to acceptance.\" 1 Page on Contracts, 44. \"An acceptance must be absolute and unqualified, or must include in itself an acceptance of that character which the proposer can separate from the rest, and which will conclude the person accepting. A qualified acceptance is a new proposal.\" Civ. Code, 1585. According to the record, plaintiff here testified that the signing of the papers was tentative and that she told Reid \"they were not to be used.\" She further told him that \"they must notify me and see if it met with my requirements-my approval. I told him that my approval meant if the terms were agreeable to me.\" From the foregoing it is clear that the essential element of a valid contract, a meeting of minds on all essential**37 elements, was lacking and therefore the writing has no binding effect upon either party. Although plaintiff signed the documents, it was distinctly agreed that they were not to be effective until she gave her approval at some later date, when the \"blanks\" were to be filled in. \"A writing is incomplete as an agreement where blanks as to essential matters are left in it.\" 13 C. J. p. 308, par. 133. Appellants agree that the pleadings are framed upon the theory that no contract was ever entered into between the parties. They also cite the cases of Chas. Brown & Sons v. White Lunch Company, 92 Cal. App. 457, 268 P. 490, and *457McElhaney v. W. E. Moyer & Co., 101 Cal. App. 53, 281 P. 87, wherein it is held that an action for rescission must, of necessity, rest upon the existence of a contract to be rescinded, and where there is no meeting of the minds there can be no contract and hence there is nothing which can be rescinded. Therefore, they contend, the action is merely one to recover a money judgment for an 2014 Thomson Reuters. No Claim to Orig. US Gov. Works. 23 P.2d 35 FOR EDUCATIONAL USE ONLY 132 Cal.App. 454, 23 P.2d 35 (Cite as: 132 Cal.App. 454, 23 P.2d 35) amount less than $2,000 and that it should have been brought in the municipal court. Article 6, 11, Const.; St. 1925, p. 658, 29, as amended by St. 1931, p. 1717. [5] The solution of the questions here presented depends upon the nature of the action. Appellants contend that it is one at law. Respondent contends that it is a suit in equity, authorized by section 3412 of the Civil Code, which reads as follows: \"A written instrument, in respect to which there is a reasonable apprehension that if left outstanding it may cause serious injury to a person against whom it is void or voidable, may, upon his application, be so adjudged, and ordered to be delivered up or canceled.\" The instrument here involved is on its face a completed contract, signed and executed by all parties thereto. It could be placed upon record any time by defendants or assigned by them to a third party. That such recordation or assignment might cause serious injury to plaintiff is not open to question. We are of the opinion that the facts of this case entitled respondent to invoke the provisions of the Civil Code above quoted. [6] It is contended that the complaint does not state a cause of action under the provisions of section 3412 of the Civil Code, in that it does not allege that \"there is a reasonable apprehension that * * * it [the outstanding instrument] may cause serious injury\" to plaintiff, nor does it allege facts upon which a finding of reasonable apprehension could be based. The complaint alleges that defendants had sold the note and deed of trust which were provided for in the purported contract. This indicated conclusively that appellants were claiming rights under the purported contract. In the case of Prichard v. Kimball, 190 Cal. 757, 214 P. 863, 865, the court used the following language in considering the sufficiency of a complaint under this section of the Civil Code: \"Whether the appellants were using the document vexatiously or not was immaterial. If they were claiming rights *458 Page 4 under it, and their claim was groundless, respondents had the right to a decree that as to them the instrument was void, whether appellants' claim was bona fide or for purpose of vexation.\" This section has been applied to an action to cancel a deed upon the ground that it had never been delivered and the essential allegations of a complaint for such relief are clearly set forth in the case of Keele v. Clauser, 101 Cal. App. 500, 281 P. 1073. In the instant case there was no contract executed, nor was there any delivery of the same, according to the allegations of the complaint. We therefore hold that the complaint states a cause of action under the section of the Civil Code above quoted. [7] The municipal court had no jurisdiction because the relief under this section of the Code is clearly equitable. Angus v. Craven, 132 Cal. 691, 64 P. 1091. [8] It is contended by appellant that the action is \"barred\" by section 1691, subdivisions 1 and 2, of the Civil Code. These sections do not \"bar\" anything, nor should they be pleaded and treated as statutes of limitation. They simply lay down certain rules which should guide the trial court in determining whether or not a rescission has been accomplished. In any event, they have no bearing upon the issues here presented, as the action was not brought under those sections of the Code authorizing a rescission. Other points made by appellants have been considered, but they do not warrant further discussion. The judgment is affirmed. We concur: PULLEN, P. J.; PLUMMER, J. Cal.App. 3 Dist. 1933. Patterson v. Clifford F. Reid, Inc. 132 Cal.App. 454, 23 P.2d 35 2014 Thomson Reuters. No Claim to Orig. US Gov. Works. 23 P.2d 35 FOR EDUCATIONAL USE ONLY 132 Cal.App. 454, 23 P.2d 35 (Cite as: 132 Cal.App. 454, 23 P.2d 35) END OF DOCUMENT 2014 Thomson Reuters. No Claim to Orig. US Gov. Works. 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