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Full-Text Articles in Law
Venture Capital On The Downside: Preferred Stock And Corporate Control, William W. Bratton
Venture Capital On The Downside: Preferred Stock And Corporate Control, William W. Bratton
Michigan Law Review
When stock indices drop precipitously, when the startup companies fizzle out, and when it stops raining money on places like Wall Street and Silicon Valley, attention turns to downside contracting. Law and business lawyers, sitting in the back seat as mere facilitators on the upside, move up to the front and sometimes even take the wheel. The job is the same on both the upside and downside: to maximize the value of going concern assets. But what comes easily on the upside can be dirty work on the down, where assets need to be separated from dysfunctional teams of business …
Startegy And Force In The Liquidation Of Secured Debt, Ronald J. Mann
Startegy And Force In The Liquidation Of Secured Debt, Ronald J. Mann
Michigan Law Review
The question of why parties use secured debt is one of the most fundamental questions in commercial finance. The commonplace answer focuses on force: A grant of collateral to a lender enhances the lender's ability to collect its debt by enhancing the lender's ability to take possession of the collateral by force and sell it to satisfy the debt. That perspective draws considerable support from the design of the major legal institutions that support secured debt: Article 9 of the Uniform Commercial Code and the less uniform state laws regarding real estate mortgages. Both of those institutions are designed solely …
The Transformation Rule Under Section 522 Of The Bankruptcy Code Of 1978, Raymond B. Check
The Transformation Rule Under Section 522 Of The Bankruptcy Code Of 1978, Raymond B. Check
Michigan Law Review
This Note rejects the statutory arguments that have been advanced in favor of the transformation rule, and argues that the rule is inconsistent with both the policies motivating section 522 of the Bankruptcy Code and the overall purposes of the U.C.C. priority system. Part I examines the treatment of purchase money security in the U.C.C. scheme. It also describes the exemption provisions of the 1978 Bankruptcy Code and the legislative concerns that shaped those provisions. Part II summarizes the judicial adoption of the transformation rule and the statutory basis relied upon by courts in applying it. Part III argues that …
Suretyship--Fraud Of Principal On Surety--Principal As Agent Of Creditor
Suretyship--Fraud Of Principal On Surety--Principal As Agent Of Creditor
Michigan Law Review
The plaintiff manufactured medicines, selling to peddlers who operated as independent contractors. Menning, a peddler, signed a new contract with plaintiff for operations for the ensuing year, the contract also covering payment of existing debts ($1,794) to plaintiff. The defendant, induced by Menning and relying on his statement that there was no existing debt, signed the contract as surety, the guaranty reciting a consideration of $1 received by defendant and an extension of time on any debts. This contract was terminated after seven weeks, and plaintiff sued for $1670, the balance due. The defendant claimed that Menning was plaintiff's agent …
Suretyship-Application Of Payments From Principal To Creditor-Equity Of Surety In Building Contract Funds
Michigan Law Review
A building contractor's bond, with professional surety, promises to see that all laborers and materialmen assisting upon a certain construction job are fully paid. With moneys received from work upon this building, the contractor pays a certain sum to a materialman without applying it to any particular debt. The contractor owes the materialman upon two separate debts: one for materials furnished upon this very job, and covered by this surety bond; and a pre-existing debt, in no way connected with the present contract. Is the surety able to insist that the materialman use this payment to discharge the debt on …