Law Commons^™

Recent Cases, Law Review Staff

Vanderbilt Law Review

Recent Cases:

CONTRACTS--CONFLICT OF INTERESTS--GOVERNMENT EXPERT'S PRINCIPAL EMPLOYMENT INSUFFICIENT TO VOID CONTRACT ON GROUNDS OF PUBLIC POLICY

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CRIMINAL LAW-ATTEMPT-CONVICTION OF ATTEMPT TO RECEIVE PROPERTY NOT IN FACT STOLEN

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DOMESTIC RELATIONS-UNIFORM RECIPROCAL ENFORCEMENT OF SUPPORT ACT--RELIEF FROM-EXTRADITION UPON PETITION OF THE OBLIGOR

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EVIDENCE-ADMISSIONS--GUILTY PLEA TO TRAFFIC LAW VIOLATION INADMISSIBLE IN SUBSEQUENT CIVIL SUIT

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FEDERAL JURISDICTION AND PROCEDURE--DIVERSITY JURISDICTION--ABSTENTION BY FEDERAL COURT FROM THE EXERCISE OF JURISDICTION IN DIVERSITY CASE

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LABOR LAW--LABOR--MANAGEMENT RELATIONS ACT-STATE COURT PRE-EMPTED FROM ENFORCING GRIEVANCE PROCEDURES OF COLLECTIVE BARGAINING AGREEMENT

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PROFESSION OF LAW--BAR ASSOCIATION MAY NOT DISCIPLINE AN ATTORNEY FOR CONDUCT AS …

Wrongful Death-Bases Of The Common Law Rules, T. A. Smedley

Vanderbilt Law Review

One of the oft-sung glories of the English common law is the vitality of its many rules which evolved originally from ancient custom, usage, tradition and experience. This truly amazing vitality has the virtue of imbuing the law with stability, of providing legal sanction for established commercial practices, of protecting vested property interests, and of furnishing some measure of predictability of decisions. Unfortunately, it also serves to perpetuate the force of some rules far beyond the period of their usefulness and to maintain their influence after the reason for their existence has been long forgotten.'Such was the case in regard …

United Nations General Assembly--A Captive Of Its Own Procedures, Erle Cocke Jr.

Vanderbilt Law Review

The work of the Assembly is hindered by its tedious parliamentary procedures. Its procedures should be expedited. A thorough review of these procedures and practices has been had only twice. Consideration of the procedures of the Main Committees where most of the work is done has not been had since the Fourth Session of the United Nations General Assembly. The laggard work of the Assembly increases the cost, places a great burden on the Foreign Offices of member Nations, and hinders the Assembly's efficiently discharging its functions. These functions have grown far beyond those originally intended, and the membership of …

The Real Estate Broker's Undertaking, William E. Wallace

Vanderbilt Law Review

In earlier articles I have discussed problems dealing with the enunciation and expression of listing agreements, their formal import' and the effect of one important segment of many of the attendant" payment" clauses. The former article concerned itself with the general problem of the relationship existing between a real property owner and his broker, while the latter dealt with the significance of words by which the payment clause of a brokerage agreement was introduced and with the effect of a wrongful default by the landowner. The present article will consider the legal significance of the actual terms employed to designate …

Disqualification Of Administrative Officials For Bias, Robert N. Covington

Vanderbilt Law Review

For centuries English and American writers on jurisprudence have been concerned with the problem of the impartial tribunal. With the rise in importance of the administrative agency, which often may function as investigator, prosecutor, and judge in the same proceeding, this concern has found a new focal point.' This note is designed to explore one question arising from the problem of administrative prejudice: When should an administrative official be disqualified from acting because of his bias? In investigating this problem, we shall examine the various formulas developed by the courts before whom disqualification has been urged; call attention briefly to …

Libel Per Se And Special Damages, Alfred H. Knight Iii

Vanderbilt Law Review

Toward the end of the last century a few of the American courts began to express the view that allegation and proof of special damages is necessary in libel actions unless the defamatory meaning of the words is apparent on their face.' Although none of these courts appeared to realize it, this notion was entirely of their own invention. Under the orthodox theory, which went virtually unquestioned in the century preceding these decisions, all written defamation is actionable without proof of special damages, whether it is designated libel per se or libel per quod. Words which are defamatory on their …

Tax And Other Legal Aspects Of The Corporate Practice Of Medicine, Jerry B. Martin

Vanderbilt Law Review

With the coming of regulations allowing doctors the tax advantages of corporate employees, the doctors will probably be more solidly behind the positions of the AMA in favor of the prohibition against the corporate practice of medicine. For example, at least one state group, the Tennessee State Medical Association, has recently adopted a resolution against practicing medicine in the corporate form, and there have been no recent reports of state associations taking the opposite position. The American Hospital Association which seems to lead the opposition to the corporate practice rule does not attack the rule as being intrinsically bad but …

Remaining Tort Liability Of Employers And Third Parties Under Workmen's Compensation Statutes, Ben F. Loeb, Jr.

Vanderbilt Law Review

Workmen's compensation is a mechanism designed to provide cash benefits to employees to recompense for loss of wages due to injuries sustained in work-connected activities. Theoretically, the cost of the program is charged to the consumer by increasing the price of goods and services sold to the public. An employee, covered by a compensation act, is entitled to payments if he is injured by an accident arising out of and in the course of his employment; and the fact that such employee was at fault or guilty of negligence himself is normally of no consequence.

Compensation benefits, in contrast to …

Deferred Compensation Plans: Qualifying For Non-Qualified Treatment, James F. Neal

Vanderbilt Law Review

For an important number of people in our "affluent society," the problem of spreading large current earnings, and the federal income tax imposed thereon, over a number of years has taken on sizeable proportions. Only slightly helpful for some of these people are the deferred compensation provisions of sections 401 through 404 of the Internal Revenue Code of 1954 (hereinafter referred to as the Code).'Consequently, many highly paid executives must still resort to other arrangements. The purpose of this paper is to explore the present status, from an income tax standpoint, of those non-qualified arrangements between employers and employees which …

The Constitution And The Standing Army: Another Problem Of Court-Martial Jurisdiction, Robert D. Duke, Howard S. Vogel

Vanderbilt Law Review

With the emergence of the Soviet menace after World War II, the United States has, for the first time in its history, found it essential to maintain, both here and abroad, a large standing armed force in what is technically peacetime. That has in turn brought to the fore important and novel questions concerning the jurisdiction which courts martial may constitutionally exercise. With millions of Americans serving and likely to serve in the armed forces, it is to be expected that the Supreme Court will scrutinize, with more care than ever before, legislation which purports to strip from these"citizen soldiers" …

A Variety Of Freedoms, Stanley D. Rose

Vanderbilt Law Review

The Idea of Freedom: A Dialectical Examination of the Conceptions of Freedom By Mortimer J. Adler Institute of Philosophical Research. Garden City, New York: Doubleday and Co. 1958. Pp.xxvii, 689. $7.50 . . .

Each year a number of books appear which are devoted to the subject of freedom. This has been going on for at least two thousand years. But a reading of only a few of this multitude of volumes will show that one man's freedom is not necessarily another man's. It appears obvious that some order and classification ought to be introduced into our thinking about this …

Book Reviews, Laurence H. Eldredge, Henry N. Williams

Vanderbilt Law Review

Evidence of Guilt: Restrictions Upon its Discovery or Compulsory Disclosure

By John MacArthur Maguire

Boston: Little, Brown &Co. 1959. Pp. xi, 295. $12.50

reviewer: Edmund M. Morgan

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Government and Public Administration

By John D. Millett

New York. McGraw-Hill Book Co. 1959. Pp. x, 477. $7.95

reviewer: Henry N. Williams

Recent Cases, Law Review Staff

Vanderbilt Law Review

CONSTITUTIONAL LAW--PRE-EMPTION--FEDERAL COMMUNICATIONS ACT OF 1934 DOES NOT INVALIDATE STATE WIRETAPPING STATUTE

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CONSTITUTIONAL LAW--SCHOOLS--UNCONSTITUTIONALITY OF STATUTE REQUIRING BIBLE READING IN PUBLIC SCHOOLS

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CRIMINAL LAW--BRIBERY--OFFER TO GIVE MONEY TO CONGRESSMAN'S POLITICAL PARTY

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CRIMINAL LAW--CONFESSIONS--REQUIREMENT OF CORROBORATION OF EXTRAJUDICIAL CONFESSION

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EVIDENCE--EXPERT TESTIMONY--INADMISSIBILITY OF EXPERT TESTIMONY THAT A NARCOTIC ADDICT IS UNWORTHY OF BELIEF

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FEDERAL RULES CIVIL PROCEDURE--DECLARATORY JUDGMENTS--RIGHT OF COUNTERCLAIMING DEFENDANT TO TRIAL BY JURY

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PROFESSION OF LAW--UNAUTHORIZED PRACTICE--CORPORATION MAY ENGAGE IN ACTIVITIES CONSTITUTING PRACTICE OF LAW IF SUCH ACTIVITIES ARE INCIDENTAL TO ITS PRINCIPAL BUSINESS

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STATE AND LOCAL TAXATION--INVALID ASSESSMENTS-JUDICIAL REVIEW AFTER FAILURE TO …

Executive Compensation: The Taxation Of Stock Options, Jack D. Edwards

Vanderbilt Law Review

The popularity of the stock option as a method of executive compensation results primarily from its favorable tax consequences. Under present law, an executive's ordinary income may be converted into capital gain. These discriminatory provisions provide a fertile field for tax avoidance. The first portion of this paper deals with the history of stock option taxation to date. Much of the earlier law remains applicable. The historical perspective shows the wide latitude for avoidance and the faulty assumptions in which tax treatment has been grounded. The second part deals with the present tax treatment of stock options.

Initial Capitalization And Financing Of Corporations, Chester Rohrlich

Vanderbilt Law Review

Since one of the varied uses to which stock purchase options maybe put is as a means of raising, or facilitating the raising, of capital, we deem it appropriate to direct attention to them. Like so many instrumentalities, they are subject to abuse and raise some difficulties, but used honestly and with discretion, they do represent a means (a) of compensating promoters and underwriters and retaining their continuing interest in the financial success of the corporation, (b) of adding speculative attraction to the security with which it is issued, or, less frequently, (c) of raising funds by direct and independent …

The Corporate Guaranty, Arthur M. Kreidmann

Vanderbilt Law Review

Corporate business, with increasing frequency, is conducted through subsidiary and affiliated corporations. Normally, one or two of the entities in a multi-corporate enterprise enjoy a highly rated credit standing. The remaining corporations, engaged in selling, marketing, maintenance, or other functional activities, are often under-capitalized and cannot alone develop their credit resources. Similarly, many businesses which fall without the pale of the parent-subsidiary-affiliate relationship are commercially interdependent and can operate only with the aid of a corporation whose credit position is strong. Material men and contractors, manufacturers and suppliers, sellers and customers typify such relationships connoting a business nexus.

Book Notes, Law Review Staff

Vanderbilt Law Review

Living the Law By Frank E. Cooper Indianapolis: The Bobbs-Merrill Company, Inc., 1958. Pp. xv, 184. $7.50.

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Shared Government in Employment Security By Joseph M. Becker New York: Columbia University Press, 1959. Pp. 501. $6.50.

Stock Options And Other Executive Incentive Arrangements, Charles W. Steadman

Vanderbilt Law Review

The immense economic expansion and changes of the post-war period have generated numerous problems. In American business a major product of this is to be found in the difficulty of developing and maintaining the reservoir of executive talent at levels sufficiently high that managerial functions can continue to be performed with an advanced degree of efficiency. The shortage of qualified executives has been widely reported. The competition for those available is intense and increasing.

Unfortunately, it would seem that at the very time the need is greatest the normal incentives for an individual to assume major executive status have been …

State Taxation Of Corporate Income From A Multistate Business, Paul J. Hartman

Vanderbilt Law Review

So long as we have a federal system of government, a continuing problem, and certainly one of the most pressing, is that of an effective coordination of taxes. That problem has achieved paramount impor- tance in late years. Because of new and expanding conceptions as to what governments should do for people, our state governments are continually confronted with ever-increasing demands that they provide additional governmental functions and supply more governmental services. The resulting increase in governmental activities and extension of benefits mean urgent needs for additional revenue. As prices have spiraled under the increasing pressure of meeting our domestic …

Fifteen-Year Survey Of Corporate Developments, 1944-1959, Miguel A. De Capriles

Vanderbilt Law Review

The foregoing survey, it is believed, amply demonstrates the kaleidoscopic variety of the corporate developments of the past fifteen years, even though for obvious reasons much of the detail has had to be omitted. General conclusions are difficult to draw. It seems likely that the success of capitalist enterprise in this, period and the self-imposed improvement in standards of corporate. Fanchon & Marco, Inc. v. Paramount Pictures, 202 F.2d 731 (2d Cir. management have retarded the underlying trend toward expansion of the role of government in the regulation of economic affairs. There has been no occasion for new dramatic statutory …

Subchapter S And Its Effect On The Capitalization Of Corporations, Mortimer M. Caplin

Vanderbilt Law Review

Our federal tax laws encourage the creation of complex capital structures. "Thinning" capitalizations by issuing corporate indebtedness offers well known tax advantages to both shareholder and corporation.' Also, since 1954, issuing preferred stock on incorporation is a standard procedure for side-stepping the "bail-out" prohibitions of code section 306. A "good" capitalization from a tax viewpoint, therefore, will often involve a small base of common stock, a heavier layer of preferred stock and as much debt as the tax adviser believes will be given tax recognition.

Tax Considerations In Selecting A Form Of Foreign Business Organization, Walter W. Brudno

Vanderbilt Law Review

The provisions of the Internal Revenue Code which are of particular relevance to the planning of foreign operations are few in number and are generally deceptively simple in phraseology. The substantive provisions consist of those sections which specify rules for determining the source of income, for calculating the credit for foreign taxes paid in respect of foreign source income, and for allowance of concessional treatment accorded Western Hemisphere Trade Corporations, United States Possessions Corporations, and China Trade Act Corporations. Measures designed to prevent tax avoidance which are of particular relevance are those which relate to acquisition of corporate control for …

Extent Of The Legislature's Reserve Power To Change Common Law Attributes Of Corporations, Edward R. Hayes

Vanderbilt Law Review

Does a stockholder have a right, at common law, to dissent and have his stock repurchased when his corporation purchases the assets of another business? If he does, is this a common law attribute of corporations? What other common law attributes may there be? To what extent has a legislature power to alter or modify these attributes, or to authorize alteration or modification by the holders of a majority of a corporation's stock? The discussion will be directed first to what attributes a corporation has apart from those bearing on its relations with its stockholders; next, to what attributes are …

New Books And Recent Scholarship, F. Hodge O'Neal, Jordan Derwin, C. Edwin Chapman, Jr.

Vanderbilt Law Review

The years since World War II have brought extensive developments in the field of corporation law and practice. Many states have enacted a completely new corporation statute' or a new blue sky law. At the same time, "federal corporation law" and federal securities regulation have grown substantially. Legislatures and courts in many states have given some recognition to the distinctive problems of the close corporation. A number of highly publicized proxy fights have spurred developments in the law applicable to the proxy system. Some courts have enunciated interesting legal principles applicable to the sale of corporate control. And just last …

State Taxation Of Corporate Income From A Multistate Business, Paul J. Hartman

Vanderbilt Law Review

There was a time when state and local taxes were perhaps only a minor factor in determining where a new business would locate and were probably not seriously considered in connection with most locational decisions. In recent years, however, because of the need for additional revenue on the part of state and local governments and the resulting increases in varieties and amounts of taxes, business must give more attention to the question of state and local taxes in deciding where to locate and operate. In this discussion of state taxation of corporate income from multi-state operations, we will include taxes …

The Tax Treatment Of Collapsible Corporations, Boris I. Bittker

Vanderbilt Law Review

Introductory.-Section 331 (a) (1) of the Internal Revenue Code provides that a complete liquidation of a corporation is to be treated by the shareholder as a sale of his stock, which will ordinarily produce capital gain or loss, and section 334 (a) provides that the shareholders' basis for property acquired on the liquidation is its fair market value at the time of distribution. These rules, which are of long standing, led to the tax avoidance device known as the "collapsible corporation," which in its turn led,in 1950, to the enactment of what is now section 341. As will be seen, …

Book Reviews, John C. Wahlke, Walter P. Armstrong, Jr.

Vanderbilt Law Review

The State Legislative Institution By Jefferson B. Fordham Philadelphia: University of Pennsylvania Press. 1959. Pp. 109.

reviewer: John C. Wahlke

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Handling Accident Cases By Albert Averbach Rochester: The Lawyers Co-operative Publishing Co. 1958. Pp. xii, 1505.

reviewer: Walter P. Armstrong, Jr.

Corporate Law Department Communications--Privilege And Discovery, Thomas R. Hunt

Vanderbilt Law Review

With the growth in number and size of corporate law departments, there is increased interest in determining the conditions and areas in which their communications' may be called for, and used, in litigation. As business becomes more complex, requiring adherence to legislation and regulation which allows small tolerance between the licit and illicit, or demanding close attention to administrative detail, the role of the lawyer is amplified. Concurrently, corporate counsel is engaged in areas where the distinction between business and legal considerations becomes decreasingly apparent.

Negligence Liability Of Artisans And Tradesmen, Jerry L. Moore

Vanderbilt Law Review

The purpose of this Note is to examine certain aspects of the tort liability of nonprofessional persons who engage in a trade or craft which requires skill and abilities not ordinarily possessed by the average man. Since, with such a wide range of subjects, an adequate treatment of all the problems peculiar to each trade would require volumes, it is necessary at the outset to place rather narrow limitations on the scope of this analysis. Perhaps it is best to define the outside limits in the form of two "issues" as follows. When a person engages in a certain trade …

Recent Cases, Law Review Staff

Vanderbilt Law Review

Antitrust Act--Discriminatory Practices--Defenses Available to Charge of Discrimination in Furnishing Services and Facilities

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Bankruptcy--Priority of Wages--Employer's Contributions to Welfare Funds Are Not Entitled to Priority as Wages Due to Work

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Constitutional Law--Social Security Benefits--Automatic Suspension of Deported Person's Social Security Benefits a Denial of Due Process

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Constitutional Law--Union Shop Agreement Under Railway Labor Act Violates Constitutional Rights of Employees

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Corporations--Securities and Exchange Act of 1934--Liability of Director for Profits on Stock Acquired Prior to Election as Corporate Official

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Damages--Quasi Contract--Exemplary Damages in Quasi Contract When Defendant is Guilty of Fraud

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Evidence--Other Crimes--Admissibility of Evidence …