Law Commons^™

What's Your Sign? -- International Norms, Signals, And Compliance, Charles K. Whitehead

Michigan Journal of International Law

This Article proposes a new approach to understanding state compliance with international obligations, positing that increased interaction among the world's regulators has reinforced network norms, as evidenced in part by a greater reliance among states on legally nonbinding instruments. This Article also begins to fill a gap in the growing scholarship on state compliance by proposing a better framework for understanding how international norms influence senior regulators and how they affect both state decisions to comply as well as levels of compliance.

Creditors' Rights-Garnishment-Contents Of Safety Deposit Box Rented To Judgment Debtor Reached By Garnishing Lessor, Craig E. Davids S.Ed.

Michigan Law Review

Execution against the judgment debtors having been returned unsatisfied, plaintiff secured a writ of garnishment from the municipal court against the defendant bank in November 1935. The garnishee's disclosure indicated that it held a small amount of cash with other collateral as security for loans made to the judgment debtors and the unknown contents of a safety deposit box. The box was rented by the judgment debtors in the usual manner and access to it could be gained only by simultaneous use of two keys-a master key retained by the bank and another key issued to the customer. The garnishee …

Principal And Surety - Effect Of Release Of Principal Debtor With Reservation Of Rights Against Surety, Raymond H. Rapaport

Michigan Law Review

Plaintiff leased property to defendant, who in turn assigned his rights under the lease to one Garber, the latter assuming the covenants to pay rent and against commission of waste. Plaintiff did not release defendant from the lease. After the expiration of the lease plaintiff recovered judgment for $2,844.75 against defendant, for breaches of the covenants, and then recovered a similar judgment against Garber. Subsequently Garber paid the plaintiff $2,000, and plaintiff gave him a receipt acknowledging "full satisfaction of the judgment rendered against me in the within action. The receipt of said sum is not a release of any …

Some Problems Arising Out Of Deposits To Pay Principal And Interest On Bonds, Paul P. Lipton

Michigan Law Review

Since Lawrence v. Fox contracts students have been puzzled by the numerous and varying relations that may arise when A, the debtor, delivers money to B to pay C, his creditor. Equally puzzling and much more complicated are the rights and relations of the obligor, trustee and bondholders with respect to sums deposited with the trustee to pay principal and interest on bonds.

The insolvency during recent years of many large trust companies that had been named as trustees in indentures securing corporate bonds, having on hand at the time of their failure large sums of money which …

Public Officers - Duties And Responsibilities Of Custodians Of Public Funds, Michigan Law Review

Michigan Law Review

The treasurer of a village, acting under the direction of the board of supervisors, deposited the village funds in a certain bank. The village treasurer was the managing officer of this bank. A public official's bond was given to cover his specific term beginning May 5, 1931, and ending May 5, 1932. The bond included a provision exempting the surety from liability for loss by reason of bank failure. A state statute spelled out the obligations of the principal and surety in an official bond without making provisions for any exemptions. At the close of the term of office on …

Banks And Banking - Liability Of Bank Upon Payment Of The Check Of An Insane Depositor Without Notice Of The Insanity, William L. Howland

Michigan Law Review

The plaintiff, as trustee for a depositor, sought in this action to charge the defendant bank with the amount of a check drawn by the depositor while insane. On the ground that the depositor was an inmate of the state hospital for the insane, the plaintiff had been appointed his trustee. Subsequent to this appointment, the depositor drew the check in question, and the defendant paid the amount of the check to the payee. Held, in the absence of actual or constructive knowledge of the insanity, a payment by a bank of the check of an insane depositor is …

Mortgages - Limitation Of Actions - Deficiency Decree On Basis Of Covenant In Mortgage When Action On Note Barred, Donald M. Swope

Michigan Law Review

Defendant executed and delivered to plaintiff a promissory note and a mortgage securing it. The mortgage contained a covenant to pay $10,000 (the principal amount of the note) "according to the terms of a certain promissory note bearing even date herewith." Upon foreclosure it was held, three judges dissenting, that the mortgagee was entitled to a deficiency decree notwithstanding action on the note was barred by the statute of limitations. Guardian Depositors Corporation of Detroit v. Savage, 287 Mich. 193,283 N. W. 26 (1938).

Bills And Notes - Alteration -Additional Maker As A Material Alteration, John M. Ulman

Michigan Law Review

Defendant A made and delivered the note in question in 1921, payable in two years. In 1931 after the death of the payee, the note was duly assigned to plaintiff. When plaintiff received the note, the signature of defendant B appeared below that of A. The court found that B's signature had been added by someone unknown claiming a benefit under the note after delivery and for the purpose of giving a greater security to the note and that neither defendant authorized or had any knowledge of the addition of B's name. The plaintiff sued both defendants …

Bills And Notes - Execution Of Instruments By Agents - Liability Under N.I.L.

Michigan Law Review

The liability of parties on negotiable instruments executed by agents or representatives is a matter which has not been satisfactorily settled by the cases under the N.I.L., due partly to the ambiguity of the statute itself and partly to the obstinate refusal of some courts to adopt the approach of the ordinary business man. Under the law merchant the agent ran a great risk of personal liability in executing a negotiable instrument unless he was careful to spell out that he was signing for a named principal as agent only. If he merely added to his name the phrase "agent …

Bills And Notes-Bonds Payable At Office Of Trustee Which Becomes Insolvent After Deposit According To Agreement But Before Bonds Presented, Ralph W. Aigler

Michigan Law Review

By the terms of a trust mortgage securing a large bond issue the debtor agreed that it would punctually pay the principal and interest of every bond according to the terms of the bond and coupons and would "deposit the necessary funds for such purpose with the trustee at least five days prior to the respective due dates." For the maturities of March 1st and September 1st, 1931, the requisite funds were deposited. Plaintiff's coupons of March and his bonds and coupons of September were not presented on the due dates and not until after the trustee had failed and …

Banks And Banking - Bank Collection Code - Preference For Certified Check On Drawee Bank's Insolvency

Michigan Law Review

The petitioner accompanied a bid on construction work with two certified checks drawn on the M Bank and payable to the government. On rejection of the bid the checks were returned, but in the meantime the drawee bank had been closed. The petitioner presented the checks to the receiver of the defunct bank who refused to honor them as preferred claims. An Illinois statute provided that when a bank has presented to it for payment an item drawn upon such bank, and such bank shall fail after having charged such item to the account of the drawer but without having …

Constitutional Law - Bank Reorganization Legislation - Composition With Depositors And Other Creditors, Maurice S. Culp

Michigan Law Review

Twenty States and the federal government now have laws permitting the reorganization and reopening of insolvent or failing banks. The usual statute provides for the reorganization of a bank upon some plan approved by a large majority of the general creditors of the institution; the plan must also have the approval of state banking officials and of a court of general jurisdiction, although the last is by no means a universal requirement. The reorganization, when approved, becomes binding upon all depositors and general creditors of the bank regardless of consent. By the terms of a few statutes, non-assenting creditors are …

Suretyship - Revocation By Death

Michigan Law Review

In consideration of a promise on the part of the vendor in a land contract to accept from the purchaser the first four installments of interest in the form of four notes, the decedent agreed in writing to indorse said notes and become responsible to the vendor for their payment. The surety died before the first of the notes was to be made and indorsed. A claim was made against the estate of the surety on this writing, the trial judge finding for the estate on the ground that there was no competent evidence from which damage might be determined; …

Banks And Banking - Statutory Liability Of Directors Of Insolvent Bank For Issuing Renewal Certificate Of Deposit

Michigan Law Review

The plaintiff renewed certain certificates of deposit with the defendant bank. When each renewal was issued the bank was "unsafe or insolvent," and the directors knew or had good reason to know it to be so. This was not the situation when the original certificates were issued. The plaintiff based his right of recovery from the directors of the bank upon Gen. Stat. 1923 (2 Mason, 1927) sec. 10407, which makes it a penal offense for the officers or directors of a bank to receive deposits knowing the bank is "unsafe or insolvent." Plaintiff recovered in the lower court. Held …

Suretyship-Right Of Surety To Subrogation When Creditor's Claim Not Fully Satisfied

Michigan Law Review

It may be stated as a general proposition that a surety is not entitled to subrogation until the creditor has been paid in full, and that until such time as the creditor has been completely satisfied, the right to be subrogated remains inchoate, as it was when the suretyship contract was made. A reason frequently advanced for this rule is that to allow the surety to have subrogation at once would create a hardship on the creditor. In fact, in the case of Motley v. Harris, the court permitted the surety to be subrogated to dividends of the insolvent …

Garnishment-Foreign-Double Liability

Michigan Law Review

Plaintiff, a resident of New York, obtained a judgment in Connecticut against El Saieh, a resident of Haiti, the court in that action obtaining jurisdiction by garnishment of a debt owed El Saieh by defendant, a Connecticut corporation, which was served with garnishment process, and admitted an obligation to El Saieh based on a policy of fire insurance issued through its agency in Haiti on a stock of goods located there. Plaintiff then sought to enforce the judgment against the defendant garnishee, which set up a defense of double liability, contending that under the laws of Haiti it was absolutely …

Mortgages - Equity Jurisdiction - Personal Decrees Against The Mortgagor

Michigan Law Review

The Michigan supreme court recently held that the jurisdiction of equity in proceedings for the foreclosure of mortgages is governed by statute, and that equity can only render a personal decree against the mortgagor where the statute expressly permits it. This view, if correct, must be recognized as an exception to the well settled doctrine that a court of equity which has obtained jurisdiction of a controversy on any ground or for any purpose, may retain such jurisdiction for the purpose of administering complete relief. Michigan has repeatedly affirmed this general doctrine.