Tuesday, June 21, 2005
. . . it’s interesting anyway. Adam Feibelman (North Carolina) has a new paper, Defining the Social Insurance Function of Consumer Bankruptcy, coming out in a forthcoming issue of the American Bankruptcy Institute Law Review.
Feibelman examines the relationship between consumer bankruptcy and other forms of "social insurance," such as unemployment insurance, spousal support laws, Medicare, etc. He notes that even with the "safety net" some folks fall into bankruptcy as a result of job loss, illness, or divorce, but argues this isn’t necessarily a bad thing, since an optimal safety net system may well incorporate a bankruptcy-like solution for those whose losses are significantly above average. Click on "continue reading" for the abstract.
1774: Lawyer Daniel D. Tompkins is born at Scarsdale, New York. While serving as U.S. Vice President under James Monroe, he’ll lead a private venture that inaugurates steam ferry service between Manhattan and Staten Island.
1788: New Hampshire ratifies the new Constitution and becomes the ninth U.S. state.
1871: Four members of the Irish-American labor group the "Molly Maguires" are hanged at Carbon County, Pennsylvania, for the murder of two mine bosses.
1898: Guam becomes a U.S. territory.
1903: Caricaturist Al Hirschfeld, who will prove you can earn a nice living doing drawings where everyone’s forehead is way too big, is born at St. Louis, Missouri,
1905: Existentialist writer Jean-Paul Sartre is born at Paris, France, a cousin of Albert Schweitzer.
1927: Carl Burton Stokes (Cleveland-Marshall Law 1956), whose victory in Cleveland in 1967 will make him the first black mayor of a major U.S. city, is born at Cleveland, Ohio.
1942: A Japanese submarine lobs 17 shells into Fort Stevens at the mouth of the Columbia River in Oregon. They cause no damage.
1947: Harold Dahl, in a boat with his son and a dog, encounters six UFOs at Maury Island, Washington. The aliens kill his dog, but the government manages to hush things up.
1957: Progressive Conservative Ellen Louks Fairclough becomes the first woman to hold a Canadian cabinet post when she is sworn in as Secretary of State for Canada.
1965: Roger McGuinn’s 12-string Rickenbacker guitar becomes one of the distinctive sounds of the Sixties as the Byrds release the album Mr. Tambourine Man.
2003: J.K. Rowling’s 900-page Harry Potter and the Order of the Phoenix, the fifth in the projected series, is published. It sells seven million copies the first day, and as of today, two years alter, it’s still the top-selling book on Amazon.com.
On June 20, 2005, the U.S. Supreme Court granted certiorari in Cardegna v. Buckeye Check Cashing, Inc., 894 So.2d 860 (Fla. 2005). Plaintiffs in Cardegna brought a class action against the defendant, alleging usurious loan practices disguised as check cashing transactions. The defendant invoked an arbitration clause in the agreement, but the Florida Supreme Court ruled that a trial court, not an arbitrator, should decide whether the underlying agreement was illegal. In so doing, the Florida court distinguished Prima Paint Corp. V. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967), which held that a claim of fraud in the inducement to enter a contract was encompassed by the agreement’s mandatory arbitration provision pursuant to the Federal Arbitration Act. The Florida court cited other state courts and a number of federal courts of appeals opinions similarly ruling that claims a contract is “void ab initio” rather than “voidable” should be decided in court, not in arbitration, but acknowledged a contrary Eleventh Circuit opinion from 2002.
Judging by the lively discussion at the session on Contracts and Arbitration at the recent AALS Conference on Exploring the Boundaries of Contract Law, the scope and implementation of mandatory arbitration clauses is one of the hot topics in contract enforcement, and the Supreme Court decision in Cardegna will help clarify one more aspect of that subject.
Monday, June 20, 2005
1 (1) Commentary on the Acquisition Workforce, Steven L. Schooner & Christopher R. Yukins (Geo. Washington)
2 (2) Toward a Better Understanding of Anti-dilution Provisions in Convertible Securities, Michael Woronoff (Proskauer Rose LLP) & Jonathan Rosen (Shelter Capital Partners)
3 (5) The Political Economy of International Sales Law, Clayton P. Gillette (NYU) & Robert E. Scott (Virginia)
4 (6) Free Markets Under Siege, Richard A. Epstein (Chicago)
5 (8) Contracts, Holdup, and Legal Intervention, Steven Shavell (Harvard)
6 (4) The Role of Groups in Norm Transformation: A Dramatic Sketch, in Three Parts, Robert B. Ahdieh (Emory)
7 (7) Contracts and the Division of Labor, Daron Acemoglu (MIT Economics), Pol Antras (Harvard Economics) & Elhanan Helpman (Tel Aviv Economics)
8 (9) The Societas Europaea -- A Step Towards Convergence of Corporate Governance Systems?, Udo C. Braendle & Juergen Noll (U. of Vienna Business Studies)
9 (10) Whither Commodification?, Carol M. Rose (Yale)
10 (-) Trust as 'Uncorporation': A Research Agenda, Robert H. Sitkoff (Northwestern)
Numbers in parentheses indicate last week's rank.
An employee's claim that an employer promised to leave him $1 million in his will as inducement to get him to work raises a valid promissory estoppel claim, according to a recent decision from the U.S. District Court of the Western District of Kentucky.
Owsley Brown Frazier, a wealthy collector of historic firearms, regularly bought guns over the years from dealer Michael Salisbury. On these sales Salisbury charged Frazier a commission, which Frazier later denied he had agreed to. A few years into the relationship, Frazier decided to found the Frazier Historical Arms Museum in Louisville, which is home to such items as Sir Philip Sidney’s helmet, Geronimo’s bow, and George Washington’s rifle. He hired Salisbury to be the director, promising him $100,000 a year, and agreeing to leave him $1 million in Frazier’s will. Salisbury acquired many more items for the museum, collecting a commission on each one. When Frazier learned of the commissions, he fired Salisbury, and sued. Salisbury raised a number of counter-claims, including breach of contract and promissory estoppel.
Salisbury's contract counterclaims must be dismissed, wrote Judge John Heyburn II, applying Kentucky law, because no employment term was ever specified. Thus there was no breach by Frazier even if Salisbury’s assertion that he’s entitled to the commissions is true, because he actually received the commissions. But the promissory estoppel claim -- that he went to work in reliance on the promise to leave him $1 million -- was sufficient at least to survive a motion for summary judgment.
Frazier v. Salisbury, 2005 U.S. Dist. LEXIS 11219 (W.D. Ky, June 8, 2005).
1214: Oxford University is chartered. The charter is negotiated on behalf of the University by Italian Cardinal Nicholas de Romanis, the Papal Legate to England.
1782: The U.S. Congress adopts the Great Seal of the United States. The story that the "eye-on-the-pyramid" on the reverse of the seal is some kind of Masonic sign is a myth; the eye is that of God, who "has favored our undertakings" (Annuit Cœptis).
1863: West Virginia enters the Union as the 35th state.
1893: Lizzie Andrew Borden is acquitted of murdering her father and stepmother. Contrary to the popular rhyme, they only received 29 whacks between them.
1939: Heinkel-Flugzeugwerke’s He-176 becomes the first liquid-fueled rocket aircraft to fly. The German Luftwaffe isn’t interested and it winds up in a museum.
1948: Toast of the Town, later renamed the Ed Sullivan Show, premieres on CBS Television. The original guests, comics Dean Martin and Jerry Lewis, pianist Eugene List, and tunesmiths Rogers & Hammerstein, are paid a total of $375.
1950: Future baseball Hall of Famer Willie Mays signs his first contract; the New York Giants give him a $6,000 signing bonus.
1977: The first oil begins to flow through the $7.7 billion Trans-Alaska Pipeline.
1996: Westinghouse Electric agrees to buy Infinity Broadcasting for $3.6 billion.
2002: China signs a contract to build a nuclear-powered desalination plant at Yingkou which will produce 80,000 tons of fresh water a day.