Table of Contents

Payday Lending Regulation and Borrower Vulnerability in the United Kingdom and Australia

Paul Ali, University of Melbourne - Law School, Centre for International Finance and Regulation (CIFR)
Cosima Hay McRae, University of Melbourne - Law School
Ian Ramsay, University of Melbourne - Law School, Centre for International Finance and Regulation (CIFR)

Consequential Damages Redux: An Updated Study of the Ubiquitous and Problematic 'Excluded Losses' Provision in Private Company Acquisition Agreements

Glenn D. West, Weil, Gotshal & Manges LLP, Texas Tech University School of Law

The Forum Selection Defense

Stephen E. Sachs, Duke University School of Law

Liability Regime of Carriers in COGSA: The Chinese Perspective

Mohammad Rubaiyat Rahman, Tulane University, Law School, Students

A High-Level View of Turnkey Model Contracts for the International Plant Engineering Industry

Anita Erbe, Freiberg University of Mining and Technology

Making Firms Liable for Consumers' Mistaken Beliefs: Theoretical Model and Empirical Applications to the U.S. Mortgage and Credit Card Markets

Alexei Alexandrov, Consumer Financial Protection Bureau


CONTRACTS & COMMERCIAL LAW eJOURNAL

"Payday Lending Regulation and Borrower Vulnerability in the United Kingdom and Australia" Free Download
Journal of Business Law, 2015, Issue No. 3, pp. 223-255

PAUL ALI, University of Melbourne - Law School, Centre for International Finance and Regulation (CIFR)
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COSIMA HAY MCRAE, University of Melbourne - Law School
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IAN RAMSAY, University of Melbourne - Law School, Centre for International Finance and Regulation (CIFR)
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The current debate in the United Kingdom about the appropriate regulatory response to payday lending involves the key issue of borrower vulnerability. There is compelling evidence in the UK that many payday lenders are deliberately making loans to financially vulnerable borrowers who cannot afford those loans. This article examines the evidence for borrower vulnerability in the UK and Australia and the regulatory responses in those two countries to payday lending. Payday loans in Australia are the same as those that are available in the UK and the concerns that are now being raised in the UK about payday lending formed the basis for recent regulatory intervention in Australia. This article also contains an empirical study of the location of payday lending businesses in Australia. We investigate whether payday lenders are more likely to locate their business operations in areas where larger groups of financially vulnerable people are living.

"Consequential Damages Redux: An Updated Study of the Ubiquitous and Problematic 'Excluded Losses' Provision in Private Company Acquisition Agreements" Free Download
Business Lawyer, Forthcoming

GLENN D. WEST, Weil, Gotshal & Manges LLP, Texas Tech University School of Law
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An “excluded losses� provision is standard fare as an exception to the scope of indemnification otherwise available for the seller’s breach of representations and warranties in private company acquisition agreements. Sellers’ counsel defend such provisions on the basis of their being “market� and necessary to protect sellers from unreasonable and extraordinary post-closing indemnification claims by buyers. Buyers’ counsel accept such provisions either without much thought or on the basis that the deal dynamics are such that they have little choice but to accept such provisions notwithstanding serious questions about whether such provisions effectively eviscerate the very benefits of the indemnification (with the negotiated caps and deductibles) otherwise bargained-for by buyers. For buyers’ counsel who have given little thought to (or need better responses to the insistent seller’s counsel regarding) the potential impact of the exclusion from indemnifiable losses of “consequential� or “special� damages, “diminution in value,� “incidental� damages, “multiples of earnings,� “lost profits,� and the like, this article is intended to update and supplement (from a practitioner’s perspective) the legal scholarship on these various types of damages in the specific context of the indemnification provisions of private company acquisition agreements.

"The Forum Selection Defense" Free Download
Duke Journal of Constitutional Law & Public Policy, Forthcoming

STEPHEN E. SACHS, Duke University School of Law
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Forum selection is hardly new, but courts still disagree on the basics. What do these agreements really do, and how should they be invoked? This Article suggests a few answers.

First, forum selection is a form of procedural waiver. A permissive agreement waives the parties' objections to litigating in the chosen court. A mandatory one waives their rights to litigate somewhere else. Whether each agreement succeeds in waiving what it purports to waive is a question of procedure, not just contract law. So its validity rests on the procedural law of the forum -- including, in a federal forum, federal law.

Second, forum selection can be raised as a defense. When a plaintiff files in the wrong court, a mandatory agreement gives that court a reason to deny recovery. Whatever other remedies are also available, such as venue transfer or forum non conveniens, the agreement can be invoked as an affirmative defense -- whether in the answer, on summary judgment, or (under the right circumstances) in a motion to dismiss.

To some, these procedures may seem unwieldy; to others, unduly harsh. Perhaps we should handle forum selection in some other way. If so, we should amend our statutes or our Federal Rules. Until we do, though, we should use the rules we have -- under which forum selection is a type of waiver, and a defense.

"Liability Regime of Carriers in COGSA: The Chinese Perspective" Free Download
Graduate Lawyers at Tulane (GLAT) Law Review, Forthcoming

MOHAMMAD RUBAIYAT RAHMAN, Tulane University, Law School, Students
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The economy of China is accelerating at a pace, with an average of 10.5 per cent per year. It reflects that China has enormous influence in the realm of global commercial and maritime interests. It urges to study Chinese Carriage of Goods by Sea (COGSA). The paper provides broader illustration of Carrier's Liability in Chinese Maritime Law. The global history of liability regime is not static, rather it is evolving. Liability regime is such a field where new development has been happening from time to time. China is not an exception from that. In China, which is a statute law country, the legal system of COGSA is structured upon Chinese National Laws.

"A High-Level View of Turnkey Model Contracts for the International Plant Engineering Industry" Free Download

ANITA ERBE, Freiberg University of Mining and Technology
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The present discussion paper provides an overview of key characteristics of turnkey model contracts for Major Industrial Plant Projects (MIPP). The overview includes four international model contracts used in the plant engineering industry: the FIDIC Silver Book, the Orgalime Turnkey Contract for Industrial Works, the ICC Model Contract for the Turnkey Supply of an Industrial Plant, and the ENAA Model Form for Process Plant Construction.

"Making Firms Liable for Consumers' Mistaken Beliefs: Theoretical Model and Empirical Applications to the U.S. Mortgage and Credit Card Markets" Free Download

ALEXEI ALEXANDROV, Consumer Financial Protection Bureau
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Firms may have better information about consumers' prospects after purchase or contract or about the effective terms of the purchase/contract than consumers themselves do. Many firms also have the ability to shrink the gap between consumers' beliefs and the effective terms of purchase/contract, either by adjusting consumers' beliefs about the effective terms or by adjusting the terms to better correspond to consumers' beliefs. I analyze the effects of a policy change that makes the firms potentially liable if the consumers' beliefs do not correspond to the effective terms. I show that an introduction of such liability can improve both social welfare and consumer surplus, even if (actually, especially if) the market is perfectly competitive. I also show that the extent of the improvement depends on the relative magnitude of three factors following the introduction of the liability: 1) decrease in the gap between the beliefs and the effective terms of the contract, 2) decrease in output (increase in price), and 3) efficiency of administering the liability. I proceed to analyze data from the U.S. credit card market and the U.S. mortgage market, where similar liabilities were introduced -- several large credit card issuers were unable to include mandatory arbitration clauses with provisions that effectively precluded class action lawsuits against the issuers and the residential mortgage creditors became subject to a private cause of action in the case that they do not consider the consumer's ability to (re)pay when originating the mortgage. I do not find a statistically significant output decrease (price increase) in either of the two cases, suggesting that the introductions of such liability improved consumer surplus and might have improved social welfare.

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Contracts & Commercial Law eJournal

IAN AYRES
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RANDY E. BARNETT
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LISA E. BERNSTEIN
Wilson-Dickinson Professor of Law, University of Chicago Law School

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