OBC General Legal common mistakes
OBC General Legal · Understand the traps and how to avoid them.
Treating the UCC sale-of-goods analysis and the common-law services analysis as interchangeable, applying common-law mirror-image rules to a merchant's purchase-order and invoice exchange and calling it an acceptance.
Candidates learn contract formation through the common law first and then bolt on Article 2 without switching frameworks; the exam deliberately mixes goods and services so the default rule is easy to misapply.
What to do instead
Before analysing any formation question, classify the contract aloud: goods, services, or hybrid, and state the predominant-purpose test if hybrid. Then recite the governing rule set (UCC 2-207 for conflicting terms between merchants versus common-law mirror image) before applying facts.
Concluding an agent had apparent authority based only on the principal's internal belief or the agent's own assurances, without identifying a manifestation by the principal to the third party.
Apparent authority feels intuitive and candidates conflate it with actual authority or with the agent's self-representation; exam fact patterns bury the principal's silence or inaction as the only manifestation.
What to do instead
For every authority question, write three labelled lines: actual (express or implied), apparent (principal's manifestation to the third party, reasonably relied on), and ratification (knowledge plus acceptance of benefits). If no principal-to-third-party manifestation exists, apparent authority fails.
Answering a personal-jurisdiction or venue question by reciting the minimum-contacts standard and stopping there, without completing the statutory and fairness steps or distinguishing general from specific jurisdiction.
Candidates memorise the constitutional test as a single step and skip the long-arm statute, the relatedness inquiry, and the fair-play prong; the exam rewards the full sequence.
What to do instead
Use a fixed checklist: (1) long-arm statute authorises, (2) constitutional minimum contacts, (3) relatedness, (4) fair play and substantial justice. State which prong fails when the answer is no jurisdiction, and separately test general jurisdiction only for domicile or continuous-and-systematic affiliations.
Relying on the business-judgment rule as an automatic shield in every governance question, without first checking whether the duty of loyalty, self-dealing, or a conflict of interest triggers entire fairness.
The business-judgment rule is the memorable default, so candidates apply it reflexively; they miss the threshold question of whether the decision-maker was disinterested and informed.
What to do instead
Before invoking business judgment, ask two questions: was the director or officer disinterested, and was the decision informed? If either answer is no, shift to entire fairness analysis and discuss the effect of approval by disinterested directors or shareholders.
Mixing the elements of negligence with the elements of a professional malpractice claim, omitting the duty-to-the-profession standard and the causation requirement that the client would have prevailed but for the error.
Malpractice is taught as negligence plus a gloss, and candidates drop the case-within-a-case causation element, which is the most heavily tested distinction.
What to do instead
Write the malpractice elements as a distinct list: professional duty, breach measured against the ordinary skill of the profession, actual and proximate causation, and damages including the lost underlying claim. Explicitly address the case-within-a-case proof before concluding.
Treating a secured party's failure to file a financing statement as fatal to its priority against all parties, ignoring the purchase-money security interest's twenty-day grace period and the automatic-perfection rules.
Candidates reduce Article 9 to file-first-wins and forget the exceptions; the exam tests the exceptions precisely because they are counterintuitive.
What to do instead
For each priority question, run an exception sweep: PMSI in consumer goods (automatic), PMSI in inventory or equipment (twenty-day grace), automatic perfection in proceeds, and control for deposit accounts. Then rank by the residual first-to-file-or-perfect rule.
Answering an ethics question by choosing the option that is merely prudent or client-friendly, rather than the option compelled by the applicable rule on confidentiality, conflicts, or candour to the tribunal.
Candidates reason from general fairness instead of the specific rule text, and the exam pairs a defensible-sounding distractor with the technically correct rule application.
What to do instead
Identify the governing rule number or doctrine first (for example, concurrent conflict, former-client conflict, or disclosure of adverse authority), state its elements, and eliminate any option that is only aspirational or discretionary when the rule is mandatory.
Confusing the standard of review for an agency adjudication with the standard for rulemaking, or asserting that a court reviews factual findings de novo when the substantial-evidence standard governs.
Administrative law is studied as a list of doctrines without pairing each to its procedural posture; candidates default to de novo review because it is familiar.
What to do instead
Build a posture table: formal adjudication and formal rulemaking get substantial evidence; informal rulemaking gets arbitrary and capricious; legal conclusions get de novo with deference doctrines considered. State the posture, then the standard, then the outcome.
Stating a hearsay objection or exception without identifying the declarant, the out-of-court statement, and the purpose for which it is offered, so the analysis never reaches the correct exclusion or exception.
Candidates jump to the exception name they recognise and skip the definitional threshold; non-hearsay uses such as effect on the listener or impeachment are frequently missed.
What to do instead
For every evidence question, write four lines: declarant, statement, offered-for purpose, and whether the purpose depends on the statement's truth. Only if it does proceed to a hearsay exception, and name the elements of that exception.
Treating a contract remedy question as answered once expectation damages are computed, without addressing mitigation, foreseeability, liquidated-damages enforceability, or the election among remedies.
Expectation interest is the first formula learned and candidates stop there; the exam adds consequential damages and penalty-clause facts that change the result.
What to do instead
Run a remedy checklist in order: expectation, reliance, restitution, then limiters (foreseeability, mitigation, certainty), then equitable remedies and enforceability of liquidated damages as a reasonable forecast versus a penalty. State which remedy the client may elect and why.