Thank You for Sharing Your Space

I have been posting on Red Lion Reports far longer than anyone could reasonably deem acceptable for a guest, so I thought it was high time to do my farewell post. Thank you, Marie, Jeff, Alison, and Kelly, for allowing me to post some of my thoughts and ideas along side yours. This was my first foray into blogging, and it has been a great experience.

I hope to have some news of a North Dakota legal blog in the near future, and I hope you will check out my article coming out in the Energy Law Journal, "Changing Resources, Changing Market: The Impact of a National Renewable Portfolio Standard on the U.S. Energy Industry," which should be available sometime in April. Over the next few weeks, I plan to watch my alma mater Spartans tear through the South bracket on their way to a fifth Final Four under Coach Izzo, and I expect UND hockey to roll through the Final Five and then the Frozen Four. One can hope, anyway.

Thank you, again, for your hospitality and for allowing me to be a small part of Red Lion Reports.

I'm Sorry My Son, But You're Too Late In Askin'

In Contracts today we'll cover Peevyhouse v. Garland Coal & Mining Co. The lesson is supposed to be the measure of contract damages -- diminution in market value versus cost to complete. Willie and Lucile Peevyhouse thought they had contracted with the Garland Coal Co. for restoration of their land after Garland finished its surface coal mining operation. The court held for Garland. It left Willie and Lucile with a check for $300 and land that would never be the same.

In all the years I've taught this case as a companion to Cardozo's masterful Jacobs & Young v. Kent, a song runs through my head. I saw John Prine play this "when I was a young girl . . . ." This is the real lesson of Peevyhouse v. Garland Coal Company. Listen.

Shameless Plug

I have posted a draft of my latest article, Hedging the IRS - A Policy Justification for Excluding Liability and Tax Insurance Proceeds, on SSRN.

Basically, uncertainty as to tax results is an ever-present obstacle to many business transactions. Private insurance companies now provide an insurance product to protect the insured party against adverse tax consequences from proposed transactions. Ironically, this new insurance product, labeled "tax insurance," poses uncertain tax consequences itself. If the adverse tax consequences arise (that is, if the taxpayer has the additional tax liability) and the insurance company is required to cover that liability, are the insurance proceeds included in the insured's gross income?

Commentators have concluded that the proceeds are taxable. Insurance companies also appear to adopt that view as evidenced by the fact that tax insurance policies generally include gross-up provisions to cover the tax that might be imposed on the disbursement of the proceeds. Contrary to that general opinion, I argue that the tax insurance proceeds are not includible in the insured's gross income.

As part of the reasoning that underlies my conclusion concerning tax insurance, the article examines the tax treatment of general liability insurance. The proceeds of general liability insurance have not been treated as taxable when paid to satisfy a laibility of the insured. Some commentators have questions whether there is a policy justification for that treatment under tax policy. I address that question and develop an approach that provides a tax policy justification for excluding those proceeds from the insured's income.

The piece is still a draft so, if you have a chance to read it, any comments, suggestions or criticisms are welcome.

Seriously?

That’s really all I have to say about the revelation that Eliot Spitzer has been implicated in a prostitution ring. Okay, not all I have to say, but I think that about captures it.

How is it that someone who spent so much time and effort pursuing fraud and corruption could put themselves in such a horrible situation? I know, I know: "Power tends to corrupt, and absolute power corrupts absolutely. Great men are almost always bad men."

Blah, blah, blah. Sometimes I think it is phrases like this that make some people think it is okay to act outrageously. Somehow acts that lead to grand downfalls are justified, in the mind of the actor, as the cost of (or reward for) pursuing greatness generally. Then again, maybe it is just this simple: people are fallible and the more high profile a person it is that falls, the more likely we are to learn about it. Some people are mostly good, and some people are mostly bad, and all of us have varying degrees of both qualities.

I had no illusions that Spitzer was perfect, or even necessarily a good person (I have never met the man), but I admit I am a bit surprised by the specific type of downfall. If nothing else, I thought he was smarter than that. I suppose, whether we mean to or not, we have a tendency to treat people, especially famous ones, as all good or all bad. And maybe that is really the issue. Instead of assuming that we know people from the halftime show on Monday Night Football (sidenote: this will always have a piece about Brett Favre) , Behind the Music, or 60 Minutes, we should start recognizing we know only a little bit about the featured personality.

We are all complex beings who cannot be figured out or summarized in a sound bite or snippet. At least, not until we do something really, really outrageous. Then, sometimes, and unfortunately, one simple word captures it all: Seriously?

Solution to the Democratic Tie?

Pennsylvania has a primary on April 22nd and, for once, it actually means something on the Democratic party side. (So much so that, much as occurred in Ohio, some residents are rushing to change their party affiliation to Democrat in time to vote.) To avoid a long and potentially harmful battle, both Clintons have suggested that Hillary is open to the possibility of a joint ticket. But would Obama agree to it?

The Clintons would, of course, prefer that Hillary be the top part of the ticket, with Obama as her vice president. But since Obama is currently leading (even if only marginally), I don't think it is likely that he will agree to such an arrangement at this point and he has now said so publicly.

So is there another deal that Hillary could offer Obama, one that benefits her and that he might accept? Perhaps Hillary could appeal to Obama's interest in having a real impact on the future of the country and offer him the first open seat on the Supreme Court. It is probably my lawyer bias, but I think that a person could have a much greater impact as a justice than as vice president (especially given the lifetime appointment - which, for Obama, could easily be 30-40 years). Of course, Obama could make the same offer to Hillary. While she is older than Obama, the position may still appeal to her.

Would either be enticed by such an offer? Weighing against accepting is the "historical first" consideration (which favors the president/vice-president option over the Supreme Court for both nominees). It may also depend on the way that the court will lean for the next 30 years. It might be fairly distressing to write 30 years of dissenting opinions (although some types relish that role). In the end, though, which deal would you take: justice or vice president?

Red Lion is on Spring Break

Hey y'all. Red Lion is headed to South Carolina for Spring Break.

You've got to hand it to a state that has a state dance: The Shag. Add a little beach music -- party in a can.

The Most Precious Gift

What gives a commodity its value is admittedly not an exact science, though I think most would agree that it is determined by some combination of its rarity and demand. There is one “commodity,” however, that despite the demand for it, cannot be purchased for ourselves: time. The demands on our time are so great that most of us wish we could add hours to our days or days to our weeks. We are a non-stop society, filling our time with the ever-important tasks of life in the modern world. As we all know, at the end of our lives, no matter our wealth or importance, we cannot buy for ourselves more minutes. Much can be said about our temporal limitations, but what strikes me as the most impressive is how some individuals so willingly and generously give of their time to help others.
Read the rest of this post . . . .

I am enrolled in Jurisprudence this semester, and one idea we have explored is the possibility of humanity to act altruistically. Are we really completely self-interested, and hence motivated? I do not think so. Of course we have natural tendencies towards selfishness, but I believe there is goodness in each of us, and that we have the capacity to act in accord with that goodness. I believe this, because I have witnessed kindness and goodness in others. We all have roles to play at work and home, and within those roles, there will be natural obligations on our time. Yet, even with obligation, there are still professors who give time to mentor students and there are still friends who give time to counsel each other. A cynic may argue that an individual acts because he believes there is some benefit to him. Unfortunately, there may never be a satisfactory answer to the cynic, but for me, I choose to believe the motivation of others is altruistic.

In all seasons of life, we are blessed by individuals who, for whatever the reason, care for us and invest in us. In the church-calendar, we are still observing Lent. Whether you observe Lent formally or not, time for quiet contemplation and reflection are always good practice. In the midst of the demands on our time, the stressors of the semester and the difficulties of life, I am humbled to notice that I am not alone. I am grateful for the individuals in my life who model to me the goodness of the human spirit. Without them, my experiences and learning would be greatly diminished.

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The artist of the painting imaged in this post said the following of his work:
We all remember a teacher from our childhood who gave us the gift of time and helped us when we needed it. As the years go by, we think of them and become aware of the precious gift they gave to us. We feel an emptiness inside because we want these teachers to know that they made a difference and that they affected our lives forever. But we never told them. My painting, A Gift of Time, is dedicated to all teachers who have given such a gift – my way of saying, “Thank you, thank you, thank you”. – Jim Daly