The Role of the U.S. Courts in the Transnational Flow of Funds

International Law and Politics, Vol. 17, No. 3, 1985

18 Pages Posted: 22 Oct 2014

See all articles by John Hoffman

John Hoffman

Shearman & Sterling LLP

Rachel Deming

Barry University - Dwayne O. Andreas School of Law

Date Written: 1985

Abstract

This Article discusses the so-called "debt crisis" from the perspective of two litigators. They normally advise participants in these matters to stay away from the courts if at all possible. The authors' experience in large-scale international financial tangles reveals that litigation can be both a disruptive and a ponderous process, ill-suited to achieve effective solutions for these problems.

The authors suggest that a guiding principle in both asset and liability cases should be the enforcement of the reasonable expectations of the parties. Decisions that give effect to payment restrictions imposed by foreign countries on foreign branch deposits are consistent with decisions enforcing debt claims for loans expressly payable outside the borrower's country, because such decisions reflect the expectations of the parties. One need not engage in metaphysical dissertations about the situs of a debt to find a common ground for such decisions. They reflect no more and no less than execution of the parties' bargain which is the proper role of the U.S. courts in the transnational flow of funds.

Keywords: Debt crisis, payment restrictions, foreign bank deposits, debts, transnational flow of funds

JEL Classification: K23, K33, K41

Suggested Citation

Hoffman, John and Deming, Rachel, The Role of the U.S. Courts in the Transnational Flow of Funds (1985). International Law and Politics, Vol. 17, No. 3, 1985, Available at SSRN: https://ssrn.com/abstract=2491756

John Hoffman

Shearman & Sterling LLP

599 Lexington Avenue
New York, NY 10022
United States

Rachel Deming (Contact Author)

Barry University - Dwayne O. Andreas School of Law ( email )

6441 East Colonial Drive
Orlando, FL 32807
United States

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