Banking and Finance Law Commons^™

The De Minimis Exemption Of Stored Value Cards From Regulation E: An Invitation To Fraud., Sean M. O'Connor

Richmond Journal of Law & Technology

How valuable is $100? To a student? To a single unemployed parent? To a well-compensated professional? The Federal Reserve Board apparently believes that the potential loss of $100 is not a tremendous burden on anyone. In a recently proposed rule, the Board exempts stored value cards that contain less than $100 from the same regulations that protect consumers from most types of fraud associated with ATM, debit, and credit cards. Regulation E (Reg E) currently regulates the electronic funds transfers (EFTs) that are at the heart of ATM/debit/credit card transactions by requiring printed receipts, error resolution procedures, periodic statements, initial …

The American Corporation In The Twenty-First Century, Marleen A. O'Connor, George Triantis, Mark Roe, Ronald J. Gilson, Jeffrey N. Gordon

University of Richmond Law Review Symposium

"Opportunistic Downsizing of Senior Workers: Exploring the Fiduciary/Contract Distinction to Enforce Implicit Employment Agreements" lecture given by Marleen A. O'Connor, Professor of Law at Stetson College.

"The Motivational Implications of Debt Financing" lecture given by George Triantis, Nicholas E. Chimicles Research Professor of Business Law and Regulation at the University of Virginia and the Director of the John M. Olin Program in Law and Economics.

"Political Backlash and the Corporation" lecture given by Mark Roe, Professor of Law at Columbia University and Director of the Columbia Law School Sloan Project on Corporate Governance.

"Venture Capital and the Structure of Capital …

It's Not Love, But It's Not Bad: A Response To Critics Of Prepaid College Tuition Plans, J. Timothy Philipps, Ed R. Haden

University of Richmond Law Review

Two years ago one of the authors published an article surveying the tax ramifications of prepaid college tuition plans, with a focus on the Michigan plan - the Michigan Education Trust ("MET"). That article took a generally positive view of such plans in general and of MET in particular. It discussed three basic themes: 1) the uncertainty of existing tax law with respect to prepaid tuition plans requires clarifying congressional legislation; 2) the position of the Internal Revenue Service ("Service") with respect to prepaid tuition plans, as enunciated in a private letter ruling addressed to MET, is flawed; and 3) …

The Rtc: A Practical Guide To The Receivership/Conservatorship Process And The Resolution Of Failed Thrifts, Vicki O. Tucker, Patti G. Meire, Phyllis M. Rubinstein

University of Richmond Law Review

In response to a growing crisis in the thrift industry, Congress enacted the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 ("FIRREA" or "Act"). The crisis was evidenced by the failure of over 500 thrifts between 1980 and 1988-more than three and one-half times as many in the previous forty-five years combined. In 1988 alone, the Federal Savings and Loan Insurance Corporation ("FSLIC," which prior to FIRREA insured most of the thrift industry's deposits) merged or liquidated over 200 insolvent thrifts, and the U.S. Government's General Accounting Office ("GAO") estimated in 1989 that at least 338 additional thrifts were …

Annual Survey Of Virginia Law: Creditors' Rights, Joseph E. Ulrich

University of Richmond Law Review

This article addresses developments in Virginia creditors' rights from April 1988 to April 1989. It is aimed at the non-specialist who nonetheless handles creditors' rights problems in practice. The following will describe the more important holdings and offer some comments about these holdings.

Annual Survey Of Virginia Law: Creditors' Rights, Joseph E. Ulrich

University of Richmond Law Review

This article is addressed to attorneys with a general practice, as well as those familiar with the creditors' rights area. Its purpose is to alert the non-specialist to developments of the last two years-April 1986 through April 1988. Virginia cases dealing with collection matters and federal bankruptcy decisions are reviewed. Legislation enacted over the past two years is also noted.

Virginia's 'Affiliated Transactions' Statute: Indulging Form Over Substance In Second Generation Takeover Legislation, Stanley K. Joynes Iii, Steven J. Keeler

University of Richmond Law Review

Virginia's recently enacted antitakeover statute, the "Affiliated Transactions" provision of the Virginia Stock Corporation Act, raises serious constitutional and economic questions. Although the form of the statute appears to regulate the internal affairs of Virginia corporations, the substance and practical impact of the statute render it violative of both the commerce and supremacy clauses. Constitutional analysis of state antitakeover legislation necessitates consideration of the economic desirability of an unrestricted market for corporate control. The United States Supreme Court's most recent statement on the subject, in CTS Corp. v. Dynamics Corp. of America, decided on April 21, 1987, reflects a noteworthy …

Criminal Rico: Forfeiture Of Fees, Sixth Amendment Rights, And Attorney Responsibilities, Elizabeth E. Stanulis

University of Richmond Law Review

The Racketeer Influenced and Corrupt Organizations Act (RICO) is the most expansive criminal statute ever passed by Congress. The statute and its amendments impose strict penalties for various activities associated with organized crime, including forfeiture of the proceeds of criminal activity. However, RICO's ambiguous language has caused confusion in its interpretation by federal courts.

Lowe V. Sec: Investment Advisors Act Of 1940 Clashes With First Amendment Guarantees Of Free Speech And Press, Stacy P. Thompson

University of Richmond Law Review

In the wake of mounting controversy over whether federal securities laws can withstand first amendment scrutiny, the United States Supreme Court granted certiorari in Lowe v. SEC to consider whether the first amendment prohibits an injunction against publication and distribution of an investment advisory newsletter by an unregistered investment advisor. However, the Court bypassed this constitutional question, and instead adopted a statutory construction of the Investment Advisers Act of 1940 (the "Act") that excluded Lowe's newsletters as "bonafide financial publications" of general circulation under section 80(b)- 2(a)(11)(D). The majority ruled that the petitioners were not investment advisers, and therefore did …

The Deductibility Of Bank Branching Expenditures: Central Texas Savings & Loan Association V. United States: A Weak Rebuttal To Ncnb Corp. V. United States, David Fields Webb

University of Richmond Law Review

In North Carolina National Bank Corp. v. United States, the Court of Appeals for the Fourth Circuit held that certain expenditures incurred by a national bank in connection with, yet prior to, the opening of branch offices were deductible under I.R.C. section 162 as ordinary business expenses. In Central Texas Savings & Loan Association v. UnitedStates, the Court of Appeals for the Fifth Circuit held that similar costs incurred by a savings and loan institution in its branching activities were capital rather than ordinary in nature, and could not be deducted under section 162.

The Trustee Versus The Trade Creditor: A Critique Of Section 547(C)(1), (2) & (4) Of The Bankruptcy Code, Michael J. Herbert

University of Richmond Law Review

The Bankruptcy Code, like its predecessor the Bankruptcy Act, permits the trustee to avoid certain preferential transfers made or suffered by the bankrupt just prior to bankruptcy. Generally, any transfer relating to an antecedent debt made to or for a creditor by an insolvent within ninety days before the filing of the bankruptcy petition is avoidable by the trustee. The trustee may sue the creditor to recover the preference. In addition, the preferred creditor will not be entitled to any dividend from the estate until the preference is repaid.

In Re Cheeseman: A Judicial Revision Of Virginia's Homestead Exemption Laws, Henry N. Ware Jr.

University of Richmond Law Review

The Bankruptcy Reform Act of 1978 was the first major revision of federal bankruptcy law in over forty years. An important goal of the Act is to provide the debtor with a "meaningful fresh start." To that end, the Bankruptcy Act provides liberalized allowances in amounts and types of property that a debtor may hold exempt from creditors in an insolvency proceeding. Under section 522 subsection (b) of the Act, however, a state is permitted to "opt out" of the federal exemption scheme and prescribe under its own law the exemptions a debtor may claim. Virginia is among those states …

Scheduled Principal Prepayments: The Residential Mortgagor's Financial Response To Front-Ended Interest Charges, James E. Anderson

University of Richmond Law Review

In this era of double-digit inflation and high mortgage interest rates, many aspiring homeowners (as well as present homeowners) are searching for ways to mitigate the financial sting of skyrocketing housing costs. Prepayment of mortgage loan principal is a simple, little publicized, but completely legal technique which allows certain mortgagors to completely repay their mortgage loans, usually within half of the original loan period. This technique simultaneously trims thousands, and more often tens of thousands, of dollars from the interest charges the mortgagor would ordinarily pay under the terms of his mortgage note.

A Post-Santa Fe Blueprint For Courts In Rule 10b-5 - Actions For Breach Of Fiduciary Duty: Kidwell V. Meikle, Richard L. Sisisky

University of Richmond Law Review

Pursuant to the Securities Exchange Act of 1934, the Securities and Exchange Commission adopted SEC Rule 10b-5. Introduced without much fanfare in 1942, the Rule's potential effect was not then fully appreciated. There is no question that over the years the courts have interpreted the broad language of rule 10b-5 expansively, and while a great deal of the law governing securities matters is reflected in circuit court opinions, the Supreme Court has recently undertaken an active role in determining the scope of rule 10b-5. In the recent case of Santa Fe Industries, Inc. v. Green, the Supreme Court held that …

Redemption Of Stock Under The Model Business Corporation Act And The Virginia Stock Corporation Act, Daniel T. Murphy

University of Richmond Law Review

The Model Business Corporation Act (hereinafter the "Model Act") has been in existence for more than twenty-five years, and has served as the paradigm for the revised corporation statutes of approximately twenty-five states, including Virginia. Despite its age, certain of its provisions have been infrequently applied and interpreted in judicial opinions. One such set of provisions is that dealing with a corporation's right to redeem shares of its stock. The purpose of this article is to analyze the Model Act's provisions regarding the redemption of shares; and to review, in contrast thereto, the relevant provisions of the Virginia stock corporation …

Multiple-Party Accounts: Does Virginia's New Law Correspond With The Expectations Of The Average Depositor?, Barbara M. Rose

University of Richmond Law Review

There are literally thousands of joint savings and checking accounts throughout Virginia in which the bank signature card provides that either party during their joint lives or the survivor may withdraw funds without limit from the account. The Virginia Supreme Court forthrightly recognized the problems of such accounts in the landmark case of King v. Merryman, stating, "For more than half a century, the courts of this country have struggled to discover whether a joing deposit bank account with an extended right of survivorship ...is a gift, a trust, a contract, or joint tenancy, or a testamentary disposition." In an …

Regulation Of Consumer Credit In Virginia: A Suggestion For Legislative Improvement, Douglas P. Rucker Jr., William C. French

University of Richmond Law Review

The American economic system is the most successful yet developed, and consumer credit has played a vital role in that economy. Consumer credit has experienced tremendous growth, and has adjusted to the demands of changing life-styles, economic needs, and geographic distinctions, as well as to the different types of consumer goods which have become available with a minimal amount of government intervention. What government intervention there has been has involved restraint and restriction. There now exists the need to improve the consumer credit industry to enable the citizens of Virginia to continue to be able to obtain both the necessities …

Dissenting Stockholders' Rights In Virginia: Exclusivity Of The Cash-Out Remedy And Determination Of "Fair Value", Howard T. Macrae Jr.

University of Richmond Law Review

Until relatively recent times, the generally accepted rule was that a corporation could not merge, consolidate or sell all of its assets without the unanimous consent of its stockholders. Each stockholder was accordingly vested with an individual right of veto over any such corporate action from which that stockholder might dissent. In order to eliminate this shackle on corporate activity, state legislatures enacted legislation permitting corporations to enter into such so-called "extraordinary transactions" as mergers, consolidations and sales of all or substantially all of the corporate assets upon some specified majority vote of all of its stockholders. The price extracted …

The "Public Interest" And Bank And Savings And Loan Expansion In Virginia, David Parcell, Richard D. Rogers

University of Richmond Law Review

In the past, two phrases have been the subject of much evidence and legal argument in proceedings before the Virginia State Corporation Commission (SCC). The two phrases are public need and public convenience and necessity. Application of these two phrases has controlled the formation of new financial institutions and the expansion of existing ones. In 1976, the Virginia General Assembly eliminated in part these two phrases and in their place substituted a single phrase- public interest

Equal Credit Opportunity Act Amendments Of 1976, Judith B. Henry

University of Richmond Law Review

It would be difficult to exaggerate the role of credit in today's society. But for the availability of credit, it would be impossible for most Americans to obtain an education, purchase a car, own a home, or start a business. Because of the increasing popularity of credit cards, credit is relied on daily in consumer transactions. Yet a number of persons have been unable to obtain credit, not because of an inability to repay, but because of their membership in a particular class.

Virginia Law Of Interest And Usury, John W. Edmonds Iii

University of Richmond Law Review

The concept of a limitation upon the charges that may be imposed for the hire of money is hardly modem. Although it may not be the oldest usury law, a reference to Deuteronomy should suffice: "Unto a stranger thou mayest lend upon usury; but unto thy brother thou shall not lend upon usury."

Preferential Land Assessment In Virginia, Eric E. Adamson

University of Richmond Law Review

The post-World War II land boom has seen cities and many towns snake outward into the countryside, engulfing millions of acres of formerly open land and developing them into suburbs. Cities have expanded not merely in numbers of people; they have over the past several decades also swallowed up vast areas of heretofore rural and farm land as city dwellers have fled to the suburbs.

Joint, Totten Trust, And P.O.D. Bank Accounts: Virginia Law Compared To The Uniform Probate Code, J. Rodney Johnson

University of Richmond Law Review

Litigation involving the survivorship rights of parties to joint accounts has been before the Supreme Court of Virginia on ten occasions since 1955. These ten cases, plus one older one, constitute all of Virginia's case law on this subject. Instead of attempting a chronological analysis of the development of this case law, it is proposed to state such rules as now exist and compare them with the results that would be obtained under the new Uniform Probate Code. In addition, attention will be focused on the statutes that deal with the rights of parties and financial institutions in deposit accounts …

Recent Legislation, J. Rodney Johnson

University of Richmond Law Review

The 1972 session of the General Assembly was especially active in the areas of wills, trusts, and estates. Much of this legislation deals with fine points not affecting the average lawyer in his practice. However, the following items of legislation should be of general interest to the attorney whose practice involves probate work or estate planning, even though he does not hold himself out as a specialist in these areas.

Limitations On Defenses Under 10 (B): In Pari Delicto And Unclean Hands, G. Andrew Nea Jr.

University of Richmond Law Review

The evolution 'and development of the corporate conglomerate has been the most significant factor in the growth of twentieth century American enterprise. Corporate growth has far outdistanced that of alternative forms of business. The purchase and sale of an increasing volume of corporate securities has permitted management to raise impressive quantities of capital, and has allowed numerous investors to share in the profits realized from the judicious use of their funds.

Recent Legislation

University of Richmond Law Review

This is a list of the recent legislation from 1970.

The Securities Acts And (Hopefully) How To Avoid Them, John W. Edmonds Iii

University of Richmond Law Review

With the boom and bust of the twenties and thirties, there developed a new legal concept-regulation of the sale and issuances of securities. It is an unfortunate comment upon the business ethics of some Americans that such laws were felt necessary. Nevertheless, such laws apply to the honest and the dishonest, and to the sophisticated as well as the credulous.

New Tricks For Old Dogs, Harry L. Snead Jr.

University of Richmond Law Review

On the first day of January, 1966, Virginia practitioners will receive a bagful of .new tricks. The UNIFORM COMMERCIAL CODE becomes effective in Virginia on that day. In adopting the Code during its 1964 legislative session Virginia became the twenty-ninth state to adopt the Code; the Virginia version of the Code follows, with but few exceptions, the official version sponsored by the Commissioners on Uniform State Laws.

Joint Control By The Surety: A Virginia Statute And Its Common Law Ancestry, D. Orville Lahy

University of Richmond Law Review

It happened in Texas, but it could just as well have been Virginia. At the June 1934 term of the County Court of Anderson County, Texas, there was offered for probate the holographic will of Herman Oberweiss. The testator and his several brothers had settled in Texas after emigrating from their native Germany, and without benefit of much education Herman Oberweiss had been able to accumulate considerable wealth during his lifetime.

Usury In The Purchase Of Negotiable Paper, James H. Barnett Jr.

University of Richmond Law Review

This monograph attempts to explore the nature of certain transactions in negotiable paper. In the transactions under consideration the plaintiff admittedly would qualify as a holder in due course under section 62 of the Negotiable Instruments Law, hereafter referred to as the NIL. In Lynchburg National Bank v. Scott, 91 Va. 652 (1895), it was held that the maker's defense of usury between himself and the payee was not good against a subsequent holder in due course. The validity of that holding is not questioned here. It is important to distinguish the defense asserted in the unusual situations discussed herein …