WikiLeaks Effect

The Washington Post and other similar articles all seem to think that US-International relations will be damaged as a result of the leaked documents and memos. Is the US the only nation to use such "candid" language in private conversation or is the US merely being ostracized because they have been caught now. A Russian politician said that it would not affect his image because he has heard the same type of things in his own meetings. Will this all blow over? Also, should the people that obtained this information illegally be allowed to share it with others? Does freedom of speech reach to information that you should not rightly have?

(the Washington Post Article)

http://www.washingtonpost.com/wp-dyn/content/article/2010/11/29/AR2010112902481.html?hpid=topnews

Modern Case involving Subrogation

Cozen O'Connor recently handled the first trial to go to a jury on the issue of strict liability against a manufacturer of CSST (corrugated stainless steel tubing). We are pleased to announce that, following an eight day trial conducted by Mark Utke of our Philadelphia office, the jury found CSST to be a defective product and imposed strict liability against Omegaflex, one of the major manufacturers of CSST. Mark represented Terence and Judith Tincher, as well as their property insurance carrier, for both subrogated and uninsured losses. The jury awarded 100% recovery of both the subrogated and uninsured losses, for a total judgment that will exceed $1,000,000. Tincher v. Omegaflex involved a CSST line that was installed in 1998 and failed from the effects of indirect lightning in June of 2007, and was tried in the Common Pleas Court of Chester County, Pennsylvania.
Recipients of our Subrogation Alerts and readers of the blog know of the issues arising from the development of CSST. Since 1988, CSST has been used in industrial, commercial and residential construction to transport pressurized propane and natural gas. The tubing walls are flexible and only approximately 10 mils thick (the equivalent of four sheets of paper), making CSST extremely vulnerable to the energy from indirect lightning strikes. While seeking to go to ground, the energy can result in a perforation in the tubing. When this occurs, an arc ignites the pressurized gas and causes a blow torch effect, which typically results in a significant fire. CSST failures are annually responsible for millions of dollars in property damage across the United States, and hundreds of claims are pending against the various manufacturers of CSST.
Omegaflex sells a brand of CSST known as TracPipe, which first came on the market in 1996, as a replacement for traditional black iron pipe. To date, over 750 million feet of this product has been sold across the country. The purported advantages of TracPipe are its flexibility, ease of installation, and ability to reduce the incidents of gas leaks. At trial, Omegaflex argued TracPipe’s ability to survive natural disasters, such as earthquakes and tornadoes, far outweighed any disadvantage associated with the product, including its vulnerability in confronting indirect lightning strikes. Omegaflex also argued that a properly bonded CSST system could withstand the energy produced from an indirect lightning strike. Omegaflex's failure to ever test TracPipe’s ability to withstand such energy, when properly bonded, proved fatal to its defense.
The National Electric and Fuel Gas Codes both contain bonding requirements for household gas and electric systems. However, these codes are intended to address life safety issues arising from stray electric current, as opposed to the dissipation of the energy created by an indirect lightning strike. Despite this, CSST manufacturers, as an industry, argue that compliance with these code requirements demonstrates their products to be safe. However, the National Fire Protection Association is currently evaluating the effectiveness of bonding as it relates to CSST and has considered recommending a complete ban on the sale of CSST, absent a demonstration by the industry that bonding can be a safe and effective means of safely dissipating the electrical energy created by an indirect lightning strike.
The Tincher verdict, significant on its own, has the potential to impact cases against Omegaflex beyond Chester County, Pennsylvania. A viable argument exists to extend the principles of collateral estoppel to apply to other cases against the manufacturer in other jurisdictions, involving similar facts and claims of defect. The defective nature of the product would no longer be an issue for the jury to decide, given the prior determination by the Tincher jury.
For additional information, please feel free to contact either Mark Utke or any of the 130 subrogation attorneys at Cozen O’Connor.

I read though this article and saw it as a more modern example of Subrogation than the asbestos cases of the 1980's. Since this case was against only one manufacture it now open a can of worms for all those who manufacture the CSST propane system.

http://www.subrogationrecoverylawblog.com/2010/10/articles/products-liability/csst-1/jury-rules-that-csst-is-a-defective-product-in-landmark-case/

My Judge Alex episode, good lesson on the importance of a written contract

The importance of written contracts. If I would have got it in writing on day one it would not have taken me an entire year to get my money.

Part 1
http://www.youtube.com/watch?v=xQdZ8-y2sQs

Part 2
http://www.youtube.com/watch?v=TGIFMPTdYeo

The usual questions that come up:

Did you get your money? Yes, one of the incentives of being on the show as a Plaintiff is an appearance payment and the show cuts the check to me instead of me having to deal with the defendant any more. The day of the taping I got my appearance check of $250, then three weeks later got my judgment check.

How much was made up? Not a single word was made up, in fact they cut out the funniest part about him not even being able to make up a name. My room mate said "Are you Peter? I'm Mark." Peter said "Um... I am um... Mark too." The show did not know if they could use my room mate's name so they cut it out to be sure, even though they could have.

Was it staged? Not completely. There are 17 minutes to be taped so on my podium there was a computer screen that the producer would put the key points of my case and notes. If I was going too fast it would say something like "go into detail" or too slow it would say "get to the signing of the contract". I timed myself very well and the producer even mentioned I did better than anyone she has had in there. A compliment, but if you watch any of the other episodes the people on there aren't the brightest.

Hope you enjoyed it.

Board of Inland Revenue v Haddock

Just something on a lighter side for negotiable instruments:

The case^[2] involved a Mr. Albert Haddock, who was often an ever-ingenious litigant in Herbert's writing. In this misleading case, Mr. Haddock had been in profound disagreement with the Collector of Taxes in relation to the size of his tax bill.

Mr Haddock complained that the sum demanded was excessive, particularly in view of the inadequate consideration which he believed that he received from that Government in terms of service. Eventually the Collector of Taxes demanded the sum of fifty seven pounds, ten shillings.

One morning shortly thereafter Mr. Haddock appeared at the offices of the Collector of Taxes, and delivered to him a large white cow "of malevolent aspect". On the cow was stencilled in red ink:

To the London and Literary Bank, Limited

Pay the Collector of Taxes, who is no gentleman, or Order, the sum of fifty seven pounds £57/0/0 (and may he rot!)

ALBERT HADDOCK

Mr. Haddock tendered the cow to the Collector in payment of his tax bill and promptly demanded a receipt.

During the "hearing", the fictitious judge, Sir Basil String, enquired whether stamp duty had been paid on the negotiable instrument. The fictitious prosecutor, Sir Joshua Hoot KC confirmed that a two-penny stamp was affixed to the dexter horn of the cow.

The Collector declined the cow, and had objected that it would be impossible to pay the cow into a bank account. Perhaps unhelpfully, Mr Haddock suggested that the Collector could endorse the cow to any third party to whom the Collector might owe money, adding that "there must be many persons in that position".

Sir Joshua gravely informed the court that the Collector did in fact endeavour to endorse the cheque on its back, which was to say, in this case, on the abdomen of the cow. However, Sir Joshua explained: "[t]he cow ... appeared to resent endorsement and adopted a menacing posture."

The Collector then abandoned the attempt, and declined to take the cheque. Mr Haddock then led the cow away and was subsequently arrested in Trafalgar Square for causing an obstruction, leading to the co-joined criminal case, R. v Haddock.

Mr. Haddock testified that he had tendered a cheque in payment of income tax. A cheque was only an order to a bank to pay money to the person in possession of the cheque or a person named on the cheque, and there was nothing in statute or customary law to say that that order must be written on a piece of paper of any specified dimensions.

A cheque, Mr. Haddock argued, could be written on a piece of notepaper. While admitting he did not consider a cheque legal tender, he testified that he himself had "drawn cheques on the backs of menus, on napkins, on handkerchiefs, on the labels of wine bottles; all these cheques had been duly honoured by his bank and passed through the Bankers’ Clearing House". He thought that there was no distinction in law between a cheque written on a napkin and a cheque written on a cow.

When asked as to motive, he said he had not a piece of paper to hand. Horses and other animals used to be seen frequently in the streets of London. He admitted on cross-examination that he may have had in his mind an idea to ridicule the taxman. "But why not? There is no law against ridiculing the income tax."^[2]

In relation to the criminal prosecution, Mr. Haddock said it was a nice thing if in the heart of the commercial capital of the world a man could not convey a negotiable instrument down the street without being arrested. If a disturbance was caused by a crowd, the policeman should arrest the crowd, not himself.

The judge, being heavily sympathetic to Mr. Haddock, found in his favour on both the tax claim and the prosecution for causing a disturbance. By tendering and being refused the cow, the other parties were estopped from then demanding it later.

Board of Inland Revenue v Haddock:
http://en.wikipedia.org/wiki/Board_of_Inland_Revenue_v_Haddock

Monsanto and GM Crop Patents: Can you really own a Plant?

GM stands for genetically modified, and the Monsanto Corporation owns the patents for most GM crops in existence today. This may not seem like an issue, but the decisions made by the Supreme Courts, of both Canada and the U.S., have not only allowed Monsanto to patent a plant, but they allow Monsanto to pursue any farmer who wrongfully violates the terms of any one of these patents, including the mistaken planting of GM crops onto fields that do not already have GM crops. So basically, the courts are allowing Monsanto to sue farmers who have GM crops on their land that have not purchased the seed themselves. Again, this does not seem like an issue because this is basic patent law, but when one takes into account the range of possibilities in which seed can be transplanted (through accidental cross pollination by wind, or spill of seed, etc.) and the complexities of patenting a plant, the situation becomes just a bit more complicated. The leading case on this issue is one from Canada, called Monsanto vs. Schmeiser, that made it to the Canadian Supreme Court and ended with a decision in favor of Monsanto. To me, this seems very relevant to business law because of the patenting, but what is also interesting is the resultant decisions that have come out of this case (e.g. allowing Monsanto to investigate farmers and prosecute them if GM seed makes it onto their land). Take a look at the case, its pretty sad what Monsanto does and now can do to the average farmer.
Monsanto Canada Inc. vs. Schmeiser:
http://en.wikipedia.org/wiki/Monsanto_Canada_Inc._v._Schmeiser

Conditional Sales Contract

We discussed a question involving an instrument that included the phrase: "This instrument is secured by a conditional sales contract". This instrument is a note and negotiation is not affected by the fact the instrument recites the transaction which gives rise to the instrument. Therefore- the answer to this question is: Not negotiable until December 1 1987. (see p. 567)

Chapter 28: Avery v Whitworth

When George Avery signed a letter regarding the unpaid balance of $20,000, he failed to indicate his representative capacity as President and is therefore personally liable. The company name (V&L Manufacturing Co.) printed at the bottom and "George Avery, President" printed at the top of the stationery is not sufficient in demonstrating a signers representative capacity. According to the case, "it is the form of the signature in the note, and not that other printed information that appears on the page which governs the capacity in which the signer executes the note." To avoid personal liability, Avery should have signed the note "George S. Avery, President" rather than "Your Friend, George S. Avery." The word "President" after Avery's name would have been sufficient in demonstrating his representative capacity.

For Deposit Only Indorsement

In class, we attempted to distinguish the decision in Schulingkamp (p. 574) with the statement in the text: "For Deposit Only makes the instrument a bearer instrument for any bank". We know a check with the restrictive endorsement of "For Deposit Only Acct. No 12345" can be only be deposited in the Payee's bank and in account No. 12345. A check with the restrictive endorsement of "For Deposit Only" can only be deposited in any bank where the Payee has an account. Do you agree? This analysis appears to be consistent with the Schulingkamp case and the text. Comments welcome!

Question 6 "Negotiable Instruments"

The question was about money orders and if they were negotiable instruments.

Fact: The money orders said "Payable to" on them, not "payable to the order or bearer"

By putting just "payable to" it restricts the payment to whoever is on the money order. A negotiable instrument needs "payable to the order or bearer" because then it would allow the person on the money order to endorse and transfer it to someone else (being negotiable). These phrases indicate there is no objection to paying anyone to whom "the bearer" orders the paper to be paid.