Law Commons^™

The Equitable Subordination Of Claims In Bankruptcy, Asa S. Herzog, Joel B. Zweibel

Vanderbilt Law Review

The authors of this article address themselves to the problems raised by the use by bankruptcy courts of their equity powers to subordinate claims. They discuss the distinctions between subordination and disallowance, the interplay between state and federal law, res adjudicata, and the classes of cases in which equitable subordination occurs. They conclude that, while much confusion exists in this area, the equitable principles involved are generally sound and that applying them is often in the best interest of debtor, creditor, and public.

Federal Tax Liens In Bankruptcy, Pierre R. Loiseaux

Vanderbilt Law Review

In this article, the author considers the peculiarly preferred position of the tax lien under section 67 of the Bankruptcy Act. From his consideration of the position of the trustee and the claim of the government he concludes that the law as presently applied is inequitable. He advocates that the government's secret lien be held invalid against the trustee, that the inchoate lien doctrine should not be applied in bankruptcy, and that the doctrine of Moore v. Bay be modified.

The Wage Earner's Plan In Practice, Reginald W. Mcduffee

Vanderbilt Law Review

In this article Judge McDuffee discusses the present use of the Wage Earner's Plan, the need for its extension, and the potential which this provision possesses for benefiting both debtor and creditor. He documents his commentary both with statistical data and with statements made by referees throughout the nation.

Summary Proceedings In Direct Contempt Cases, Thomas R. Allen

Vanderbilt Law Review

That the "power and majesty" of the law, personified by the court and its decrees, could not be lightly brushed aside even by a prince was a settled fact by the time of Shakespeare; it remains so today. But the proceedings by which such an offense may be punished is another matter. At the present time a large number of contempts are disposed of by summary proceedings. It was not always so, and recently a number of highly respected judges and writers have begun to argue that the practice should be discontinued. This revival of interest is the raison d'etre …

Determination Of The Effect Of A Discharge In Bankruptcy, T. A. Smedley

Vanderbilt Law Review

This article examines the operation of the system under which the granting of the discharge is the function of the bankruptcy court but the construction of the effect of the discharge falls within the power of any court in which a creditor happens to bring suit to enforce an obligation of the bankrupt. The customary practice of leaving to the lower state courts the task of determining the dischargeability of specific debts is evaluated, and the bases for having this determination made in the bankruptcy court instead are explored.

Preferences Under The Bankruptcy Act, Charles Seligson

Vanderbilt Law Review

The Bankruptcy Act allows the trustee in bankruptcy to avoid the effect of certain transactions entered into by the debtor on the ground that these transactions give some creditors a preference. In this article, Mr. Seligson examines section 60 of the Bankruptcy Act to determine when this can be done. He discusses the elements of preferential transfers, the problems of proof, the relationship between state and federal law, and the manner in which the statutory provisions have been applied by the courts.

Public Utility Debt Ratios And The Public Interest--Reasonable Fixed Charges And Just And Reasonable Rates, Melvin G. Dakin

Vanderbilt Law Review

Mr, Dakin explores the complex and difficult field of the financing of public utilities corporations. He describes and evaluates the approaches of four commissions: the Securities and Exchange Commission which must approve the reorganization of public utilities corporations which have gone into bankruptcy, the Federal Communications Commission, the Federal Power Commission, and the Michigan Public Service Commission. He concludes by suggesting that in some instances these agencies are placing too great emphasis on their conception of sound financing at the expense of the customers served by these utilities.

Insurance -- 1961 Tennessee Survey, Robert N. Covington

Vanderbilt Law Review

The developments in the Tennessee law of insurance during the past year were important without being surprising. The various courts delivered opinions dealing with a number of the central issues in insurance law, especially in the field of risk control, and by and large followed the line of thinking established by past years. Many of the decisions are of less significance than one might suppose, because of their extreme involvement in particular fact situations.

Federal And State Condemnation Proceedings--Procedure And Statutory Background, William E. Miller

Vanderbilt Law Review

The development of our modern and complex society has necessitated a widespread appropriation of private property for public use. The vital importance of present-day eminent domain is emphasized by the staggering proportions of recent and proposed takings in terms of the amount of land appropriated, its monetary value, and the number of individual citizens whose property is affected. In the Middle District of Tennessee alone--of course a small part of the national total-in excess of 700 tracts or parcels of land have been condemned during the past seven and one-half years for various projects, including the Old Hickory Dam and …

Agency -- 1961 Tennessee Survey, Elvin E. Overton

Vanderbilt Law Review

The topic "agency" includes the areas of "master and servant" as well as those of "principal and agent." There were few cases in these areas decided by the Tennessee courts during the period under survey. Generally, basic principles were applied to routine cases.In certain instances the reliance upon a prior fact determination avoided the necessity of an elaborate treatment of the facts. In one or two cases the court reached a result that may not be deemed desirable though supported by much authority. Significant points received less attention than they deserved in certain cases. In one case the basic question …

Business Associations -- 1961 Tennessee Survey, Kenneth L. Roberts

Vanderbilt Law Review

I. CASES

A. Disregard of Corporate Entity

B. Action in Corporate Name After Revocation of Charter

C. Effect of Merger

1. Privilege Tax

2. Statute of Limitations

D. Judicial Intervention in Internal Corporate Affairs

E. Disregard of Fictitious Corporate Records

F. Criminal Liability of Corporation for Acts of Agents

G. Corporate Venue Under Federal Anti-Trust Laws

II. STATUTES

A. Unincorporated Associations Treated as Corporations

B. Amendments to Securities Law

C. Massachusetts Trust Act

D. Industrial Development Corporation "Projects"

E. Amendments Relating to General Welfare Corporations

F. Miscellany

Contracts -- 1961 Tennessee Survey, Paul J. Hartman

Vanderbilt Law Review

I. Offer and Acceptance--Notification of Acceptance Before Notification of Revocation--Duration of Offer with Fixed Expiration Date

II. Implied and Quasi Contract--Claim for Services Where Family Relationship Involved

III. Parol Evidence Rule--Application of Rule to Third Party Not a Party to the Written Instrument--Pre-existing Duty as Consideration

IV. Exculpatory Contracts--Contracting Against Liability for Consequences of Own Negligent Conduct

V. Agreement in Restraint of Trade-Agreement of Seller of Business Not to Compete--Enforcement of Restraint in Area Greater than Required to Protect Purchaser

Personal Property And Sales -- 1961 Tennessee Survey, James O. Bass, Jr.

Vanderbilt Law Review

The Tennessee courts have heretofore denied recovery in actions for breach of warranty in the absence of privity of contract between the plaintiff and the defendant.' The required privity had not previously been found when a manufacturer was sued by a consumer who purchased from an intermediate dealer. . . .

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Contractual Disclaimer.-In the Dodson case, there was an alter-native holding that the consumer could recover on the theory of an implied warranty of quality or fitness. The significance of such a holding lies in the fact that the express warranty which the court found running from General Motors …

Procedure And Evidence -- 1961 Tennessee Survey, Edmund M. Morgan

Vanderbilt Law Review

In this article no mention is made of the numerous reiterations of the rule that in considering a motion for a directed verdict, the trial court must deny the motion where there is any material evidence that would warrant a jury in finding against the moving party. Nor is there noted the many, many applications of the courts' settled practice to deny a petition to rehear which merely reargues matters which counsel insist were improperly decided after argument and full consideration. Again, it must be said that this survey is in most respects a mere "horizontal digest." Thus far the …

Characterization Of An Income Tax For The Purpose Of The Foreign Tax Credit, Stanley L. Ruby

Vanderbilt Law Review

Perhaps the best reconciliation of the many conflicting policies underlying the foreign tax credit would be to give preferential treatment by tax treaties to investment income from those areas where our foreign policy dictates that investment should be encouraged, whereas taxes imposed on income from other areas should be handled by the deduction approach. Thus the loss of revenue through investment in heavily industrialized areas (with stable governments and relatively little risk-taking) with high tax rates would end, but there would exist the flexibility, through treaties, to encourage investment in underdeveloped areas.

The Federal Conflicts Of Interests Statutes And The Fiduciary Principle, William P. Swain

Vanderbilt Law Review

Three events of recent months have concurred to focus public attention on conflict of interests in the federal service. The most significant of these events is the appointment by President Kennedy of a committee to inquire into the problems of ethics in government. It is to be hoped that the projected inquiry will amount to more than a footnote in a law review article, which seems to have been the fate of its predecessors.' The most spectacular event was the decision in the Dixon-Yates case, in which the Supreme Court held unenforceable a government contract because of the dual interests …

Local Government Law -- 1961 Tennessee Survey, Eugene Puett

Vanderbilt Law Review

Change of Boundaries.--Incorporated cities and towns continued to use the authority in the annexation statute to annex by ordinance,'and the courts were presented with several questions of interpretation of the statute not heretofore answered.

Discretion To Annex by Ordinance--The question in Central Soya Co. v. City of Chattanooga was whether or not a municipality when petitioned by "interested persons" must propose extension of its corporate limits by the referendum method.

Burden of Proof in Annexation--Since the action of the municipality is by ordinance, the suit to contest the validity of an annexation ordinance is in the nature of a quo …

Law And History, C. J. Friedrich

Vanderbilt Law Review

Law is frozen history. In an elementary sense, everything we study when we study law is the report of an event in history, and all history consists of such records or reports. It therefore cannot be my task to develop a sermon on the importance of historical records for the understanding of the law; the tie is too intimate and too obvious to need laboring." The work of Professor Maine on 'Ancient Law,'" wrote Professor T. W. Dwight in his Introduction to that book in the sixties of the last century, "is almost the only one in the English language …

A Decade Of The Celler-Kefauver Anti-Merger Act, Charles J. Steele

Vanderbilt Law Review

Corporations intent upon expanding via the acquisition route have had three statutory hurdles placed in their way by the Congress of the United States. As hurdles, the first two, the Sherman Act of 1890 and the Clayton Act of 1914, were failures. A judiciary which refused to give effect either to the language or intent of the acts nullified completely their usefulness as anti-merger weapons.

The third hurdle, the Celler-Kefauver Amendment to the Clayton Act, was enacted in 1950. Relatively few judicial opinions have interpreted this act, "new section 7," as it is called. It is clear, however, that it …

Annual Survey Of Tennessee Law, Val Sanford

Vanderbilt Law Review

The principal conclusion to be derived from a survey of the decisions reported and the statutes adopted during the past year in the field of administrative procedure is that sound policy necessitates the enactment of a general, uniform and effective administrative procedure act in this state.The standards by which any procedural system should be measured can readily be stated. The basic purpose of any procedural system should be to attempt to assure that all matters within its scope are resolved on their true merits, and not on some failure to follow exactly the prescribed path. To accomplish this end, there …

Bills And Notes -- 1961 Tennessee Survey, John A. Spanogle Jr.

Vanderbilt Law Review

The Tennessee courts decided three cases involving commercial paper this year. The Tennessee Supreme Court decided one case which, unless it is clarified in the near future, may upset principles which were heretofore well-established. Of the two cases decided by the appellate courts, one adopted a rule well-known in other jurisdictions, and the other adopted a sound minority view on a question not settled by the Uniform Negotiable Instruments Law.

Comment: The Enforcement Of Agreements To Arbitrate, Irving Kovarsky

Vanderbilt Law Review

Three 1960 Supreme Court decisions' have limited the ability of litigants to challenge successfully the jurisdiction and award-making powers of labor arbitrators. The limitations imposed by the Court upon the judiciary's power to question the arbitrator, a reversal of traditional procedure, is of great significance and will unquestionably necessitate some readjustment on the part of management. This article attempts to place these recent developments in perspective and to suggest briefly certain practical changes in the attitudes of courts and contract negotiators that may result from them.

Creditors' Rights And Security Transactions -- 1961 Tennessee Survey, Forrest W. Lacey

Vanderbilt Law Review

Two cases involving a claim of usury were decided during the period of this survey. However, in one, Post Sign Co. v. Jemc's, Inc.,'the court did not reach the issue of usury, but instead held that this issue could not be raised by the parties involved. The facts were somewhat complicated.

Constitutional Law -- 1961 Tennessee Survey, James C. Kirby, Jr.

Vanderbilt Law Review

Although a relatively small number of cases turned upon constitutional questions during the survey period, some important decisions were handed down in this area. In five separate decisions legislation was declared unconstitutional. The impact of the constitutional decisions varies from the right to millions of dollars in school funds in Shelby County and the salary of the clerk of General Sessions Court of Clay County to approval of permanent tenure for all franchised automobile dealers in the state. The scope of governmental power over the administration of estates, condemnation of private property and the pursuit of private businesses brought forth …

Conflict Of Laws -- 1961 Tennessee Survey, Elliott E. Cheatham

Vanderbilt Law Review

1. Non-Resident Motorists.-The statute subjecting non-residents to suit in Tennessee for injuries inflicted within the state has been extended by interpretation to non-resident parents who join in their minor child's application for a driver's license.

2. Watercraft.-The principle of the non-resident motorists statutes has been applied to watercraft by a statute entitled "Operation of watercraft in state as appointment of agent for process."

III. Support In Thomas v. Thomas a woman had been granted a divorce in Tennessee and custody of the children of the marriage, with a decree of support for the children against the father but with it …

Real Property -- 1961 Tennessee Survey, Thomas G. Roady, Jr.

Vanderbilt Law Review

Probably no area of the law is fraught with more confusion than that involving construction of clauses in deeds and wills which impose some restraint on the conduct of grantees or devisees- seemingly not in the best interest of society. Clauses which tend to deter grantees or devisees from marriage or remarriage have constituted a fertile source of litigation for centuries. And though the stated rules of law prohibit and restrict the use of marriage or remarriage as a condition to vest or divest interests in real property, there are very few cases in which the courts in this country …

Restitution -- 1961 Tennessee Survey, John W. Wade

Vanderbilt Law Review

"A person who has been unjustly enriched at the expense of an-other is required to make restitution to the other." This is the first section of the Restatement of Restitution.' It indicates the principle underlying a field of the law coordinate with tort and contract.About a dozen cases during the survey period may be classified as raising a problem within this general subject. They do not cover the whole range of the field and have here been classified on a pragmatic rather than an analytical basis.

Services are normally rendered under a contract which governs the nature of the services …

Domestic Relations -- 1961 Tennessee Survey, William J. Harbison

Vanderbilt Law Review

In the case of In re Van Huss' Petition' the Tennessee Supreme Court denied an adoption under a literal interpretation of the residence requirements inserted into the adoption statutes in 1959. Under the 1959 statutes, although the petitioners in adoption proceedings were not required to make Tennessee their legal residence, they were required to "have lived, maintained a home and been physically present in Tennessee, or on federal territory within the boundaries of Tennessee for one (1) year next preceding the filing of the petition .... -

In the Van Huss case the petitioning husband met all of the other …

State And Local Taxation -- 1961 Tennessee Survey, Paul J. Hartman

Vanderbilt Law Review

Not many cases involving state taxes have been decided by the Tennessee courts during the period covered by this survey. Action taken in the halls of Congress, however, has the potential of a major revamping of the taxing power of all state and local governments.

Decedents' Estates, Trusts And Future Interests -- 1961 Tennessee Survey, Herman L. Trautman

Vanderbilt Law Review

The subject matter will be discussed under the three headings indicated above. The developments of the year' include court decisions and relevant new legislation enacted by the Eighty-second General Assembly of the State of Tennessee. Perhaps the most significant development of probate law in Tennessee during the period was the enactment of the Uniform Testamentary Additions to Trusts Act, referred to generally as the "pour-over" statute. Very likely this statute will have a substantial and dramatic impact upon (1) the arrangements of decedents' estates, and (2). the future role that the executor and the lawyer will have in the settlement …