Loading...
Please wait, while we are loading the content...
Similar Documents
The Rejection of the Separate Entity Rule Validates the Separate Entity Rule
| Content Provider | Semantic Scholar |
|---|---|
| Author | Sant, Geoffrey |
| Copyright Year | 2012 |
| Abstract | This Article argues that by rejecting New York's "separate entity rule," federal district courts have unwittingly created problems that, ironically enough, validate the rule. The separate entity rule is a long-standing New York doctrine under which each branch of a bank is treated as a separate entity (that is, as if each branch were a distinct bank) for purposes of garnishment and attachment of assets.Traditional justifications for the separate entity rule include: (1) comity, including respect for other legal systems; (2) the danger of creating contradictory court judgments regarding the same asset; and (3) the impracticality and enormous costs associated with forcing banks to routinely perform global asset searches. As of this writing, New York state and federal courts have described themselves as "deeply divided" over "whether the separate entity rule remains good law."This Article argues that the very split between federal and state courts regarding the viability of the separate entity rule itself demonstrates the value of the separate entity rule. Specifically, the "deep divide" between the state and federal decisions regarding the separate entity rule has resulted in: (1) problems relating to the issue of comity, due to certain federal courts' disagreement with and "reject[ion]" of the decisions by New York state courts; (2) contradictory judgments regarding the validity of the separate entity rule; and (3) impracticality and enormous expense, as the same issue is repeatedly litigated to differing results.Ironically, then, those district courts that have rejected the separate entity rule demonstrate its value by creating within the New York court system the very problems of comity, contradictory judgments, and legal expense that the separate entity rule was designed to prevent. |
| Starting Page | 813 |
| Ending Page | 813 |
| Page Count | 1 |
| File Format | PDF HTM / HTML |
| Volume Number | 65 |
| Alternate Webpage(s) | https://scholar.smu.edu/cgi/viewcontent.cgi?article=1206&context=smulr&httpsredir=1&referer= |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
