Volume 87, Issue 6
Articles
In an increasingly global economy, the question of how to tax international transactions is complex. Tax treaties are important in deciding these issues. These treaties are entered into between two nations in order to address how transactions will be taxed and to share information to combat tax fraud. Despite the treaties' utility, a major difficulty arises: as tax law develops the treaties must be updated.
Rather than constantly renegotiating the treaties administrative agencies issue new interpretations of the existing treaties. However, these are unilateral interpretations of a bilaterally negotiated treaty. This naturally creates tension, which Michael Kirsch explores in this article. Kirsch begins by explaining the formation and interpretation of tax treaties in the United States. He acknowledges the appeal of issuing interpretive guidance, but also elaborates on some of the obstacles to its use. After a brief discussion of the role of interpretive guidance under the Vienna Convention, Kirsch turns to examine how U.S. courts have treated the Treasury's interpretive guidance.
First, he examines the standard that courts use to determine whether to look beyond the text of the treaty. While the standard articulated by the U.S. Supreme Court varies somewhat, it is generally consistent with the Vienna Convention standards. In addition, Kirsch looks at the different forms of guidance U.S. courts use in the interpretation of tax treaties, including the Senate materials, other tax legislation, and administrative guidance. Kirsch then applies the treaty interpretation principles to determine how much weight should be given to the Treasury's technical explanations. He compares the Treasury guidance to the commentaries offered in conjunction with the OECD model treaties. Ultimately, Kirsch concludes that the Treasury's post-treaty interpretive guidance should not be given significant weight, but also identifies certain situations where it may be helpful.
This article by Jay Tidmarsh questions the usefulness of traditional tests for adequacy of representation in class action proceedings. When determining whether to certify a class, courts have sought to avoid endorsing those classes marred by conflicting interests or the possibility of collusion. Yet, Tidmarsh argues, such conflicts of interest are an intrinsic characteristic of class actions, stemming from the very policy rationales that have prompted the judiciary to allow litigation by classes.
As a result, the current doctrine of adequate representation has left the courts without a bright-line rule; instead, the courts' inquiries into adequacy of representation must focus primarily on the degree of conflicts, leading to confusion and uncertainty--indeed, were prevailing case law strictly applied, virtually no class action could survive the test for adequacy. Tidmarsh therefore proposes an alternative, bright-line rule: "Representation by class representatives and counsel is adequate if, and only if, the representation makes class members no worse off than they would have been if they had engaged in individual litigation." This rule, he believes, would afford far better protection to the interests of individual class members while simultaneously providing the judiciary with a more intelligible test that could be applied with far more consistency.
Responses in See Also:
Essays
This essay by Sanford Levinson remarks on the relative dearth of book reviews among the volumes of material annually published by law reviews. Levinson demonstrates this decline through anecdotal and statistical evidence. He then explores both the importance of book reviews as a tool for matching authors to their intended audiences, and their largely untapped potential for invigorating academic scholarship and debate. The essay concludes with some suggestions as to what can be done to slow or reverse the current trend.
Notes
In this note, Russell Falconer surveys the evolving, contemporary view of the First Amendment's Press Clause as a constitutional provision designed to bestow the American press with institutional protections. First Amendment rights commonly associated with judicial efforts to assure freedom of the press, such as freedom from prior restraint, right to judicial safeguards, and raised thresholds for libel when publications pertain to matters of public concern, have all been held to emanate from the Speech Clause.
Because the judiciary has traditionally protected the free speech rights of individual members of the press under the rubric of the Speech Clause, some academics have argued that the Press Clause carries meaning only if it is interpreted to establish a collective right, recognizing the press's institutional value as an important check on government power. Falconer, however, observes that this novel view, which posits a constitutional right not vesting in individuals, challenges traditional notions of standing. Nonetheless, he argues that the resulting difficulties need not be fatal to an institutional interpretation of the Press Clause.
In this note, Ryan Hackney examines the Uniform Commercial Code's treatment of so-called "dragnet" clauses in security agreements. Dragnet clauses--devices through which a creditor endeavors to tether collateral not merely to a presently contemplated loan, for which the security agreement is consideration, but to all loans made to a debtor, past and future--are explicitly authorized by the UCC with no meaningful restrictions.
In taking such a wide stance, Hackney argues, the UCC's drafters have erred. Not only does the UCC's permissive position offer unscrupulous creditors a means by which to trap unwary debtors, it has also prompted many jurisdictions to depart from the drafters' clear intent, undermining the UCC's effort to promote national uniformity in commercial law. While Hackney believes that the current rule may be appropriate for nonconsumer transactions, in which the parties are presumed to be sophisticated, he maintains that the UCC must be amended to provide consumers with protection from the abusive use of dragnet clauses in order to address the legitimate concerns of dissenting jurisdictions.
