Law Commons^™

Modernizing Notice Of Breach Rules To Preserve Contract Remedies, Stephen Plass

University of Michigan Journal of Law Reform

Recently, the legal community has scrutinized the capacity of mandatory arbitration rules to deter or foreclose claims for breach of contract. But little attention has been paid to express and constructive notice of breach rules that are just as effective at foreclosing contractual remedies. While four-year statutes of limitations are typically viewed as the default cutoff time for breach of contract claims, contracting parties, particularly buyers of goods, must act much sooner to preserve their legal remedies. It is now common practice for sellers to require notice of breach within days or weeks of their performance as an express condition …

Applying 42 U.S.C. § 1981 To Claims Of Consumer Discrimination, Abby Morrow Richardson

University of Michigan Journal of Law Reform

This Note explores several interesting legal questions regarding the proper interpretation of 42 U.S.C. § 1981, which prohibits racial discrimination in contracting, when discrimination arises in the context of a consumer retail contract. The Note further explores how the Fifth Circuit's and other federal courts' narrow interpretation of § 1981's application in a retail setting (which allows plaintiffs to invoke the statute only when they have been prevented from completing their purchases) is contrary to the statute's express language, congressional intent, and to evolving concepts of contract theory, all of which reflect a commitment to the strict enforcement of civil …

Public Nuisance Claims Against Gun Sellers: New Insights And Challenges, Jean Macchiaroli Eggen, John G. Culhane

University of Michigan Journal of Law Reform

Gun violence continues unabated. Regulation of these deadly instruments is woefully inadequate, and legislatures are compounding the problem by barring or restricting access to the courts for the death and injuries that guns cause. In short, Congress and state legislators have repeatedly acquiesced to the demands of the gun lobby.

During the past several years, cities have struck back by filing public nuisance claims against those gun sellers whose practices pose a risk to the public's health and safety. After a slow start, public nuisance claims have recently gained traction in state appellate courts, which are increasingly coming to realize …

Comparative Negligence Under The Code: Protecting Negligent Banks Against Negligent Customers, Julianna J. Zekan

University of Michigan Journal of Law Reform

This Article will examine modern banking practices with respect to processing checks and the effect of technology on liability for forged or altered checks. Part I describes the magnetic ink character-recognition system. Part II discusses check truncation. Part III recounts the evolution of contract and tort theories of liability from traditional to modern bank practices. Part IV analyzes the new comparative negligence provisions. Part V investigates the standards of ordinary care. Part VI evaluates the respective duties of the banks and their customers in light of the provisions that reflect the banking industry's transformation from the Paper Age to the …

Defining "Green": Toward Regulation Of Environmental Marketing Claims, Roger D. Wynne

University of Michigan Journal of Law Reform

This Note joins a rising chorus calling for government regulation of green marketing claims. It attempts to encourage and add a sense of urgency to a burgeoning regulatory movement by highlighting some of the legal issues that such regulation entails. Part I identifies a gap in the law: the inability of current truth-in-advertising laws to clarify the legality of green marketing claims. Part II urges bridging that gap quickly; it examines the costs of continued nonregulation and describes some of the forms regulation is taking. Part III attempts to allay any fears that such regulations might be challenged on first …

Preserving Purchase Money Security Interests And Allocating Payments, Lynda Kay Chandler

University of Michigan Journal of Law Reform

This Note explores the rationale underlying the courts' conflicting decisions in light of the purposes of the UCC. It concludes that the language of the UCC and its goals of uniformity and simplification require that a PMSI should not be entirely destroyed because a creditor also has a security interest in items the debtor acquired after the purchase money transaction or because a creditor extends additional credit. The best solution is to permit the creditor to retain a PMSI, to the extent of the purchase money loan, in those goods that the creditor's loan helped to purchase.

Part I is …

Action Accrual Date For Written Warranties To Repair: Date Of Delivery Or Date Of Failure To Repair?, Carey A. Dewitt

University of Michigan Journal of Law Reform

This Note argues that the statute of limitations for an action for breach of a repair warranty should begin to run not when the goods are delivered (on-delivery rule), but when the manufacturer has failed to repair the goods (failure-to-repair rule). Part I considers the current division of authority relating to the action accrual date (the date at which the limitations period begins) for repair warranties. It analyzes the issue of whether the repair warranty is a species of future performance warranty under section 2-725(2) and examines non-Code law on repair promises. Part II discusses the advantages and disadvantages of …

Consumer Warranty Claims Against Companies In Chapter 11 Reorganizations, Elizabeth Warner

University of Michigan Journal of Law Reform

This article examines the rights of individuals who have purchased warranted goods from a business that subsequently undergoes reorganization under Chapter 11 of the Bankruptcy Reform Act of 1978. Part I establishes that warranty rights are claims in bankruptcy and outlines the procedure that must be followed by a creditor for distribution from the debtor's estate. Part II focuses on how warranty claims are treated in Chapter 11. Part III discusses ways to alleviate the warranty creditor's representational burden, particularly through the intervention and aid of public interest groups. This article concludes that . warranty creditors will receive favorable treatment …

Qualification Requirements For Foreign Corporations: The Need For A New Definition Of "Doing Business" Based On In-State Sales Volume, Stanley M. Klem

University of Michigan Journal of Law Reform

Part I of this article examines the mechanics of the present qualification system, paying special attention to the problems created by a multiplicity of vague state standards. Part II discusses the historical justification and purposes of the present system, concluding that only the protection function justifies the continued existence of the system. Finally, Part III proposes that "doing business" be defined in terms of the annual volume of in-state sales. This solution would remedy the problems which plague the present system while furthering the legitimate protection function of the state qualification requirements.

Customs Court Jurisdiction In International Trade Cases, Jonathan S. Brenner

University of Michigan Journal of Law Reform

This article discusses the specific problems involved in Customs Court jurisdiction. After outlining in Part I these jurisdictional problems and the court's failure to deal with them, the article, in Part II, proposes an analytic framework that focusses attention on the relevant criteria for ascertaining Customs Court jurisdiction. This framework is built upon the exclusivity of Customs Court jurisdiction and exhaustion of the administrative review process. The distinct rights of importers and manufacturers are also discussed and the special problem of cases which do not meet the procedural prerequisites for Customs Court jurisdiction are explored. Finally, Part III of this …

Products Liability: Developments In The Rule Of Successor Liability For Product-Related Injuries, Mary Annette Horan

University of Michigan Journal of Law Reform

This article will briefly review the traditional principles of corporate law governing the assumption of liabilities in the acquisition of an ongoing business, and the doctrinal premises of strict products liability. Attention will then be critically directed to recent developments in case law in which the traditional rules have been modified to reflect the policy considerations of strict products liability. Finally, this article will discuss the possibility of legislative intervention in the development of new principles governing successor responsibility for products liability claims and propose that this problem is an appropriate subject for legislative rather than judicial action.

Efts: Consumer Protection Under The Ucc, Susan E. Jinnett

University of Michigan Journal of Law Reform

In view of the economic significance of the payments system, the laws governing it must be equitable and comprehensive. The development of the commercial law applicable to EFTS's, however, currently lags behind the growth of these systems. Threats to the integrity of EFTS's stem from lost, stolen, or forged access cards, illegal taps into communication lines, physical impairment of the equipment, or improper programming. The legal rights and liabilities of consumers where the integrity of an EFTS has been breached remains unclear, in part because the status of EFTS's under current law is uncertain. The rights of the parties involved …

Toward A Uniform Approach To Multilevel Distributorships, Donald Daniels

University of Michigan Journal of Law Reform

The phenomenal growth and eventual collapse of the enterprises of Glenn Wesley Turner and William Penn Patrick during the 1960's should have surprised no one. They were only a recent example of an old and recurrent merchandising scheme, a variant of the chain letter device. Such operations, commonly called pyramid sales schemes, can temporarily succeed where a credulous public, willing to believe that it can get rich quickly for a small monetary investment and little or no expenditure of effort, exists in a legal system lacking a coordinated program for the prevention of such machinations. Pyramid sales schemes have been …

Michigan Motor Vehicle Service And Repair Act Of 1974, A. Russell Localio

University of Michigan Journal of Law Reform

This note will analyze the Michigan Motor Vehicle Service and Repair Act, examining the differences between it and prior Michigan and federal legislation. The new legislation will be compared with similar statutes in other states. Finally, the possible drawbacks of repair shop and mechanic certification programs will be discussed, and suggestions for improvements will be made.

The New York Truth In Travel Act, Lisa Kennedy

University of Michigan Journal of Law Reform

A New York couple arrange a vacation abroad through their travel agent. They expect a direct flight, deluxe, centrally located accommodations, and guided tours of local attractions. Once they have set out, they discover to their dismay that their flight makes several lengthy stops, their reservations are at a drab and uncomfortable hotel in an inconvenient location, and there are no reservations for the tours. This hypothetical situation is representative of instances of travel fraud, a frequent consumer grievance in what is acknowledged as the considerable volume of travel business being conducted in the United States. New York has attempted …

What Ever Happened To The "Checkless Society"?, Isaiah Baker

University of Michigan Journal of Law Reform

In the late 1960's and early 1970's, a proliferation of articles in law reviews and other scholarly journals predicted a fundamental change in the payments systems in the United States. The "checkless society" was hailed as the coming thing-the latest and best innovation to come along in the vast areas of law covered by the Uniform Commercial Code provisions governing commercial paper and bank collections. Despite the claims that present technology is capable of effecting basic alterations in the existing check collection and payment systems, changes have been slow to come and are coming with deliberate speed rather than the …

Some Suggestions For Nonurgent Reforms In The Ucc's Treatment Of Accommodation Parties, James A. Martin

University of Michigan Journal of Law Reform

Anyone who has studied those provisions of the Uniform Commercial Code (UCC or Code) that deal with accommodation parties-chiefly Sections 3-415, 3-416, and 3-606-knows a certain amount of despair at trying to decipher the meaning of these provisions. Fortunately, most of the problems raised are fairly narrow, and few of them have yet posed significant problems for the courts, either because they have not yet arisen or (more often) because the courts have cut through ambiguous language to reach desirable and justifiable results. Thus, most of the problems discussed below do not cry out for immediate legislative attention. The position …

A Proposal To Prevent The Stranding Of Airline Passengers, Richard J. Gray

University of Michigan Journal of Law Reform

After surveying industry structure in terms of market conditions and actual practices, this article examines the failure of the air travel industry to provide bargained-for services to passengers. It compares the current regulatory pattern with alternative regulatory proposals and scrutinizes each to determine both the validity of the assumptions upon which they are based and the relative effectiveness of each in achieving desired consumer protection. The purpose of this detailed examination is to make possible the formulation of policy recommendations capable of serving as a basis for regulatory reform.

Consumer Complaints: A Proposed Federal Trade Regulation Rule, Howard R. Lurie

University of Michigan Journal of Law Reform

It is no secret that most consumers are unable to protect themselves in the marketplace, yet government assistance to the consumer is frequently unavailable. All too often the bureaus of government are interested primarily in controversies of major significance. Minor consumer complaints are viewed as an annoyance that distract and interfere with more important matters. What must be done to protect consumers is to redress the balance of power now heavily weighted in favor of business. To do so requires that government go beyond current concepts of appropriate consumer protection and establish unorthodox remedies. One such remedy is suggested in …

New Jersey Retail Installment Sales Act, Eric A. Oesterle

University of Michigan Journal of Law Reform

The effect of the enactment of the New Jersey bill is that a "retail buyer" may now assert against an assignee of the installment contract or subsequent "holder" of the negotiable note any defenses he has against the retail installment seller. The new law would appear to be one of the most comprehensive laws of its type to be enacted. However, the draftsmen apparently left a significant loophole, appropriately termed the "specious cash sale,” which, if exploited, could negate the intended effect of the new law. This note will analyze the bill, compare it with the relevant provisions of the …

New York Specious Cash Sales Act, Craig D. Holleman

University of Michigan Journal of Law Reform

The New York Legislature recently moved to protect consumers in that state from unscrupulous retailers of consumer goods and financers of consumer loans by enacting the Specious Cash Sales Act. The new law is the third in a series of measures designed to remedy certain perceived inequities to which the holder in due course doctrine gives rise in the consumer goods field. Earlier this year, the Legislature undercut complicated mechanisms whereby a finance company could procure from a retailer contracts and obligations containing a waiver-of-defenses provision executed by the buyer-consumer. This law in turn complemented a still earlier statute which …

Souped Up Affirmative Disclosure Orders Of The Federal Trade Commission, William F. Lemke Jr.

University of Michigan Journal of Law Reform

Under section 5(b) of the Federal Trade Commission Act the Commission is given authority to conduct hearings, make findings and issue cease and desist orders requiring any person, partnership or corporation to cease and desist from use of unfair methods of competition or unfair or deceptive practices in commerce. The Commission also issues consent orders in cases which are concluded by agreement between the Commission and the allegedly offending party. Consent orders have the same force and binding effect as those issued after hearings and findings. Although it is well established that the Commission has very broad discretion and authority …

Preferential Transfers On The Eve Of The Bankruptcy Amendments, Richard M. Kohn

University of Michigan Journal of Law Reform

While secured lenders may have been content to ride the crest of judicial legislation, the only permanent solution to the problem lie in amending either the Bankruptcy Act, the Uniform Commercial Code, or both. This at least is the view taken by the National Bankruptcy Conference's Committee on Coordination of the Uniform Commercial Code and Bankruptcy Act. Since its first meeting in June 1966, the Committee has focused its attention primarily upon the validity, in bankruptcy proceedings, of Article 9 security interests in after-acquired property. In September 1967, the Committee submitted to the Bankruptcy Conference its first draft of a …

Underground Gas Storage: Economic Needs And A Proposed Statutory Resolution Of Legal Obstacles, Steven Y. Winnick

University of Michigan Journal of Law Reform

Gas storage is necessary to equate the supply and demand for gas in different parts of the United States. Most areas of the country lack sufficient native gas supplies to meet their own demands for consumption, and commercial natural gas produced mainly in the southwest must be shipped to all parts of the country. The primary and most economical means of shipment is by pipelines. But during the winter months pipelines carrying capacity loads are incapable of meeting the demand for gas, especially for residential space heating. Contrariwise, capacity far exceeds demand during the warmer periods. This Article will discuss …