State of Indiana V. Ford Motor Company revisited

In 1980, a jury returned “not guilty” verdicts on three counts of reckless homicide against the Ford Motor Company. The company was indicted when three girls were killed after their Ford Pinto burst into flames following a rear impact collision. This paper re-examines the consequences of this landmark case involving corporate wrongdoing from the perspectives of the participants 20 years later. Interviews were conducted with 22 individuals directly involved with the litigation, as well as with insightful observers and experts. The lasting impact of this case is demonstrated through its influence on the development of corporate liability, even though the company was found “not guilty.”     

US tax treatment of foreign grantor trust during the year of the Grantor's death

This article, specifically, addresses the US tax treatment ofa foreign trust that changes from a foreign grantor trust toa foreign non-grantor trust when the grantor (settlor) diesduring the year and how the trust accounts for its distributednet income and undistributed net income in the year of death.¹     

Rent seekers who demand government production: Bureaucratic output and the price of complements

Many goods and services produced by government bureaus are sold at prices which do not maximize net revenues (maximize profits or minimize losses). Indeed, bureaucratic institutions typically create incentives to expand production beyond that which would maximize net revenues. Furthermore, many of the products sold by government bureaus are highly complementary to privately produced goods and services. If a bureau's output is not priced to maximize net revenues, then private sellers of various complements may be in a position to extract rents by adjusting their prices. This paper explores the implications of bureaucratically generated rents for privately produced complements. First, rent seeking can materialize when private sector interests apply pressure for expanded bureau production and lower bureau prices. Second, if the bureau does expand its production capacity beyond the net revenue maximizing level, and if a private producer obtains exclusive rights to supply complements, then the extraction of rents will result in an inefficient mix of resources in bureaucratic production. The basis of the inefficiency is not the reason often given, however. Rather, inefficiencies arise because the actual level of use is less than that which the ‘bureaucratic plant’ was constructed to produce due to the relatively high price of the complementary services.     

Tales of law and morality

B.A. (hons.), Acadia University 1982; B.A. (juris.), Oxford University 1984; LL.B., Dalhousie University 1985; B.C.L., Oxford University 1986; M.A., Oxford University 1991.     

The American Way of Going to War: Mexico (1846) to Iraq (2003)

Prior to the Iraq War, there had been a long series of American wars in which U.S. leaders often maneuvered the other side into “firing the first shot.” This strategy of “passive defense” amounts to an American way of going to war, and it dates back at least to the U.S.-Mexican War. The United States thus retained the moral and legal legitimacy, an asset which is especially important in a democratic political system. The Iraq War represents a fundamental departure from this American way. It might be the worst crisis since Vietnam. but that war was just another entry in the U.S. playbook for how to go to war. The Iraq War not only contradicts longstanding practices in American foreign policy, but it has the potential to issue in far greater international disorder than the Vietnam War. This catastrophe may make future presidents more heedful of John Quincy Adams’ prophetic words: go not abroad in search of monsters to destroy.