Digital Commons Network^™

Utilization Of State Commissioners In The Administration Of The Federal Motor Carrier Act, Paul G. Kauper

Michigan Law Review

The problem of securing effective governmental regulation of economic interests that overlap state boundary lines, while at the same time curbing the growth of a centralized bureaucracy and preventing the disintegration of local government, becomes daily more disturbing. For this reason the passage of the Motor Carrier Act in the closing days of the 74th Congress and its approval by the President on August 9, 1935, was an event of singular importance for students of American governmental administration. Important as the legislation is in its substantive aspects, it is equally noteworthy because of its administrative provisions. The striking feature of …

Practice And Procedure - Reservation Of Decision On Motion For Directed Verdict As Means Of Avoiding Unnecessary New Trials

Michigan Law Review

What may be done to remedy the situation if a jury brings in a verdict in favor of a party against whom a verdict should have been directed? This question becomes pertinent in view of the fact that judges, while hard pressed by counsel in the heat of trial, frequently wrongfully deny a motion for directed verdict and submit the case to the jury. One obvious remedy is the granting of a new trial by the trial judge, or by an appellate court after reversal. But this practice has proved eminently unsatisfactory, for it submits the aggrieved party to the …

Public Utilities -- Rate-Base -- Late Supreme Court Decisions

Michigan Law Review

In fixing the rate-base of a telephone company, the Maryland Public Service Commission translated the agreed 1923 rate-base (with all subsequent additions to plant) to 1933 price levels by means of a composite price index which included both general all-commodity indices, and indices particularly adapted to the telephone business. Held, that an order enjoining enforcement of the rates will be affirmed. West v. Chesapeake & Potomac Telephone Co., (U.S. 1935) 55 S. Ct. 894.

Bankruptcy- Preferred Stockholders As Creditors For Accrued Dividends Under Section 77b Of The Bankruptcy Act

Michigan Law Review

Preferred stockholders were "beguiled" into purchasing their stock, and paid, as part of the subscription price, for accrued dividends at the rate of 6 per cent per annum from June 1, 1933, to the date of their respective subscriptions, upon the "virtual promise of refund" on December 1, 1933, the next dividend date. No dividend was declared or paid. Such stockholders seek to file a petition for the reorganization of the corporation under Section 77B of the Bankruptcy Act as "creditors" within the meaning of the word as employed in that section. Held, they are "creditors" within the meaning …

Constitutional Law - Power Of State Legislature To Provide For Jury Trial In Proceedings For Contempt Of Court

Michigan Law Review

The defendants, an independent union, and members thereof, were cited for contempt before a court of common pleas for the violation of an in junction restraining them from interfering with the operation of the plaintiff's mines. The alleged contumacious acts took place some ten miles from the court house and consisted of gathering about automobiles containing employees of the plaintiff company, throwing stones at them, breaking windows of the cars, and injuring some of the occupants. The contempt proceedings arose on petition of the company and were before the same judge who granted the injunction. The defendants claimed that under …

Physicians And Surgeons-Voluntary Sterilization-Public Policy

Michigan Law Review

Plaintiff, advised by his physician that further pregnancy would endanger the life of his wife, submitted to an operation of vasectomy. Defendant physician informed him that the operation had been successful and that he could resume sexual relations with his wife without fear. The wife, however, became pregnant and plaintiff alleged that as a consequence he suffered mental agony and was put to great expense. He sued his physician on the theory of deceit in falsely representing to him that he was effectively sterilized. The lower court sustained a demurrer on the ground that the contract was contrary to public …

Wills - Gift's - Construction Of Instrument

Michigan Law Review

Decedent had lived with plaintiff and her parents. In 1932, after telling plaintiff's parents that he had some money in the bank, decedent said, "I got a will here . . . I understand I have got to have two signatures." Both parents, at his request, signed the instrument below.

"Dear Carlotta

"I give to you my money in Live Stock Bank.

"Hans Larsen

"April 16, 1932

"Witness: Michael C. Kelley

"Mamie V. Kelley."

Decedent put the instrument in his bank book and took it into the other room where plaintiff was sitting. He said, "Carlotta, I will give you …

Evasion Of Mortgage Moratoria By Prosecution Of Personal Remedies, Gordon B. Wheeler, Edgar N. Durfee

Michigan Law Review

For reasons political, social and economic which have never been fully analyzed, the moratory legislation of the last five years has shown special favor to the debtor whose obligation is secured by mortgage of land, and this legislation is faintly echoed in moratory decisions which have no direct statutory foundation. Granted that contracts have sometimes received similar treatment, that banks and insurance companies have also enjoyed indulgence, and that the new chapters of the Bankruptcy Act extend asylum to all and sundry, yet the mortgage is so far favored that the word "moratorium" brings to mind this case before all …

Corporate Reorganization-Section 77 Of The Bankruptcy Act--Power Of Court To Enjoin Sale Of Bonds Pledged As Collateral

Michigan Law Review

The recent Chicago, Rock Island case raised an interesting problem under Section 77 of the Bankruptcy Act. The Chicago, Rock Island as parent railroad of a system extending into one-fourth of the states, had pledged large blocks of its own mortgage bonds and those of its subsidiaries, as security for loans made to it by the Reconstruction Finance Corporation and some Chicago, New York, and St. Louis banks, under an agreement whereby the pledgees were given a power of private sale, without notice, upon set contingencies. In addition to the above it had previously pledged with trustees as security for …

Bills And Notes - Bad Faith On Part Of Pledgee Taking Bonds

Michigan Law Review

Defendant, a Wisconsin firm, issued certain bearer bonds secured by a mortgage held by the T corporation, as trustee. A provision in the mortgage defining the duties of the trustee in the disposition of bonds delivered to it was incorporated into the bonds by reference. The trustee being insolvent, plaintiff bank, as pledgee of some of the bonds taken to secure personal loans to the trustee, petitioned the referee in bankruptcy for permission to sell them, claiming to be a bona fide pledgee for value. Held, since federal courts are bound to follow state decisions interpreting state statutes declaratory …

Constitutional Law - National Industrial Recovery Act

Michigan Law Review

Defendants conducted wholesale poultry slaughterhouse markets. They had been convicted in a District Court of violating the following provisions of the "Live Poultry Code," promulgated under Section 3 of the National Industrial Recovery Act: (1) Minimum wages; (2) Maximum hours; (3) Requirement of "straight killing"; (4) Requirement of compliance with the inspection ordinances of the City of New York; (5) Requirement of filing of true reports of volume of business, etc., to the Code Authority; (6) Requirement of sale to dealers licensed by the City of New York. On a writ of certiorari to the Supreme Court of the United …

Book Notes

Michigan Law Review

This department undertakes to list and, when possible, describe briefly current books on law and matters closely related thereto.

Corporations-Section 77b Of The Bankruptcy Act-To What Corporations It Applies

Michigan Law Review

Creditors of a title and mortgage company which had gone into receiver's hands petitioned for a reorganization of the company under Section 77B of the Bankruptcy Act. Held, that the company was an insurance corporation. Insurance corporations are not amenable to Section 77B. Petition for reorganization dismissed. In re New York Title and Mortgage Co., (D. C. N. Y. 1934) 9 F. Supp. 319.

Constitutional Law--Mortgages--Frazier-Lemke Act

Michigan Law Review

In 1922 and 1924 appellee mortgaged property worth $18,000 to secure a loan of $9,000 from appellant which was to be repaid in installments over a period of thirty-four years. Default being made on the covenants in the mortgage, the mortgagee declared the full amount due and brought a suit to foreclose. Proceedings were stayed when the appellee sought relief under Section 75 of the Bankruptcy Act, but he was unable to obtain the requisite majority in number and amount to the composition proposed. The state court entered a foreclosure judgment and ordered a sale. The mortgagor then sought relief …

Fraudulent Conveyances - Change Of Beneficiary Of Life Insurance Policy Formerly Payable To Insured's Estate

Michigan Law Review

An insurance company filed a bill of interpleader to determine disposition of the proceeds of a term policy on the life of one Fitzpatrick, now deceased. Claimants are the administrator, representing creditors, and the deceased's two sons. The policy had been issued payable to insured's estate, but reserved the right to change the beneficiary. A few days before his death (by suicide) deceased sent the company an application for change of beneficiary to his two minor sons. He was then hopelessly insolvent, and the administrator claims that the change of beneficiary was a fraudulent conveyance within the terms of the …

Book Notes, Michigan Law Review

Michigan Law Review

This department undertakes to list and, when possible, describe briefly current books on law and matters closely related thereto.

Agency - False Representations By Agent - Ratification

Michigan Law Review

During an intensive stock-selling campaign of the defendant power company, the stock salesman represented to the complainant that the corporation would repurchase at par upon demand any of the stock then offered. Relying upon this representation the complainant purchased thirty shares of stock for $3,000, the company apparently receiving his money and issuing the stock with knowledge of the false representations; when he later wished the company to repurchase the stock, it refused. On suit for (1) rescission and recovery of sum paid, or (2) reformation and specific performance, the company claimed among other things that the agreement made by …

Taxation - Immunity Of State Officers From Federal Income Tax-Trustees Operating Boston Elevated Railway Company As State Officers

Michigan Law Review

A state law provided for public operation of the Boston Elevated Railway Company, with a board of trustees appointed by the governor with the advice and consent of the council. The salaries of the trustees were received from the company. The trustees were to manage and operate the company, having "possession of said properties in behalf of the Commonwealth." They were to fix rates of fare that would insure sufficient income to meet the cost of service including, in addition to operating expenses, specified rates of return on the investment. If the rates were insufficient for this purpose the deficit …

Legislative Attack On "Heart Balm", Nathan P. Feinsinger

Michigan Law Review

Public resentment over the abuses incident to "heart balm" suits has recently culminated in sweeping legislative reform. Through the repeated efforts of a woman legislator, Indiana has abolished actions for seduction of females over twenty-one years of age, for breach of promise to marry, and for criminal conversation and alienation of affections. Almost immediately New York, and shortly thereafter Illinois, passed similar legislation, and at least ten other states are now considering analogous proposals.

The Investigating Magistrate (Juge D'Instruction) In European Criminal Procedure, Morris Ploscowe

Michigan Law Review

For nearly five centuries the distinctive figure in the preliminary stages of European criminal proceedings has been the investigating magistrate, known in France as the juge d'instruction. Although temporarily eclipsed by the revolutionary reforms in France in 1791, he was soon re-established. In other European countries the juge d'instruction continued to be the central figure in the preliminary procedure through all the reforms achieved by the liberal movements of the nineteenth century. The investigating magistrate has remained a purely Continental institution. In theory and in practice he embodies the essential difference between Continental and Anglo-American criminal procedure preliminary to trial.

Has The Constitution Gone?, John A. Fairlie

Michigan Law Review

As far back as 1828, Chief Justice Marshall is quoted as saying: "Should Jackson be elected, I shall look upon the government as virtually dissolved." A few years later, when Taney was appointed Chief Justice by Jackson, Daniel Webster wrote: "Judge Story thinks the Supreme Court is gone, and I think so too." Soon afterwards, when the newly constituted Court rendered decisions upholding statutes from which Story dissented, the latter wrote to Judge McLean: "There will not, I fear, ever in our day, be any case in which a law of a State or of Congress will be declared …

Admiralty-Power Of Congress To Extend Jurisdiction Constitutional Limitations

Michigan Law Review

"The judicial Power shall extend . . . to all Cases of admiralty and maritime Jurisdiction."

"The Congress shall have Power . . . To make all Laws which shall be necessary and proper for carrying into Execution . . . Powers vested by this Constitution in the Government of the United States."

These clauses of the Constitution of the United States provide the foundation for the exercise of jurisdiction in admiralty causes by the federal courts. The recent decision of the United States Supreme Court in the case of The Thomas Barlum, upholding the constitutionality of the Ship …

Corporations-Liability For Unpaid Subscriptions-Power Of Receiver To Collect Unpaid Amount

Michigan Law Review

The liability of a subscriber to corporate stock exists by virtue of the contractual obligation to the corporation to pay the subscription price or the unpaid installment thereon. Because this liability is often declared by statute, it is essential, to avoid a confused analysis of the precise nature of the liability in question, to distinguish other types of stockholder's liability. Statutory super-added liability in excess of the par value of the stock, and liability for watered stock are excluded from consideration. An analysis of the subscriber's liability will be materially aided by a classification with respect to plaintiffs entitled to …

Corporations-State Privilege Taxes-Valuation Of Property To Determine Surplus

Michigan Law Review

Various bases have been evolved in this country for computing corporation privilege taxes. Of special interest is the fact that seven states have made corporate surplus together with capital the basis for such taxes - Louisiana, Michigan, Mississippi, Missouri, North Carolina, Ohio, and Texas. The statutes of these states adopt either the gross value or the net value of the assets of corporations as the foundation of the tax, depending upon whether or not liabilities may be deducted. In fixing the amount of such a tax, some valuation of corporate property to determine the corporation's surplus is necessary.

Eminent Domain --Valuation Of Leaseholds -- Apportionment Of Award Between Landlord And Tenant In Long-Term Lease

Michigan Law Review

The Michigan Supreme Court had before it last fall a very unusual case involving the apportionment of a condemnation award between landlord and tenant. Only a portion of the leasehold premises was condemned. The lease still had approximately eighty years to run; it had no market value due primarily to the depression; and it constituted the sole assets of the lessee. The lease contained a clause. providing for rent abatement in case part of the premises was condemned. The lessors insisted that the lessee must be content with this rent abatement and that they were entitled to the whole award. …

Corporations - Exculpatory Provision In Bond - Stockholders' Liability For Illegal Dividends

Michigan Law Review

A bondholders' protective committee sued a holding company under a Michigan statute making stockholders in street railway companies, who knowingly receive dividends in impairment of capital stock, liable for corporate debt then existing and subsequently accruing while they remain stockholders. The defense relied on was a "no recourse" clause in the bonds wherein the creditors waived their rights to any assessment whatsoever "against any incorporator, stockholder, officer or director of the railway company, or any successor corporation." Held, the "no recourse" clause waived only liabilities where the defendant acted in good faith; not where the defendant acted fraudulently in …

Criminal Law And Procedure - Right Of Accused To Be Present At Trial

Michigan Law Review

In a prosecution for bank robbery, testimony of a witness which did not connect the accused with the crime and merely served to qualify the witness was received during the unnoticed and involuntary absence of the accused. No objection was made by the counsel for the accused who was present at the time. When the accused's absence was discovered, the motion of counsel that the cause be withdrawn from the jury was overruled and the court admonished the jury not to consider the testimony. Appellant contended that he had been denied a right and that therefore injury must be presumed. …

Trusts - Mortgage Participations As Trust Investments -Effect Of Invalidity

Michigan Law Review

The Commercial Savings Bank and Trust Company of Toledo, Ohio, in March 1931, executed an instrument called a Declaration of Trust, in which it recited that it had transferred to its trust department certain notes and mortgages for the purpose of issuing certificates of participation therein. The notes alone were physically transferred to the trust department, the mortgages being retained by the real estate loan department of the bank. The real estate loan department also collected the interest and principal on the notes transferred to the trust department. The Declaration of Trust expressly authorized the trust department to make substitutions …

The Enforcement Of Foreign Judgments In Anglo-American Law, Hessel E. Yntema

Michigan Law Review

Conflicts of laws are the necessary result of the division of judicial business. There are too many legal actions arising in localities too diffused to be tried in a single court or system of courts; consequently, litigation has to be distributed, and a highly complex body of jurisdictional regulations has been evolved to control the distribution. Once admit the multiplicity of courts, and diversities of law appear. Not only does the procedure in particular courts respond in some degree to the local traditions of the bar and to the specialized needs of the communities served, but indigenous precedents and practices …

Federal Taxation Of Settlors Of Trusts, Harry B. Sutter, Anderson A. Owen

Michigan Law Review

In the Revenue Act of 1924 there simultaneously appeared three new provisions. By Section 219(g) the income of trusts revocable by the grantor, either alone or in conjunction with any person not a beneficiary, of the trust, was specifically required to be taxed to the grantor as his income. By Section 302(d) there was required to be included in the gross estate of a deceased grantor the value at his death of any property previously given by him in trust, where the enjoyment of such property remained subject to change through the exercise by the grantor, either alone or in …