International trade relations

/in /by

International trade relations
Question 1: The WTO provides a framework for member governments to:
a) agree on global rules applicable to their international trade relations
b) meet regularly and consider information provided by the members to the WTO
c) review each member’s trade-related policies and practices
d) settle their trade disputes
e) all of the above
Question 2: Before the creation of the WTO in 1995…
a) there were no fundamental rules on international trade
b) there was no international forum dealing with international trade rules
c) the old GATT 1947 provided the fundamental rules for international trade
d) the International Trade Organization served as an organization for liberalizing trade
Question 3: Which of the following is a source of gains from trade?
a) Gains from specialization and a broader variety of goods and services
b) Gains from more competition and lower prices
c) Gains from exploitation of economies of scale
d) All of the above are sources of gains from trade
Question 4: The General Council of the WTO is:
a) the highest decision-making body in the WTO.
b) composed by representatives of all Members and the Secretariat.
c) meets as appropriate to adopt decisions on behalf of the Ministerial Conference when the Conference is not in session.
d) is chaired by the Director-General of the WTO.
Question 5: In the WTO, decisions are taken:
a) by the Director-General of the WTO, on behalf of the Members.
b) by Members, by voting only.
c) by Members, generally by consensus, but voting is possible.
d) by Members, by consensus at all times.
Question 6: Which of the following statements regarding tariffs and quantitative restrictions is TRUE?
a) Both tariffs and quantitative restrictions are generally prohibited under the WTO.
b) Both tariffs and quantitative restrictions are generally permitted under the WTO.
c) Quantitative restrictions are generally allowed as long as they are applied on an MFN basis.
d) Members are generally prohibited from applying quantitative restrictions.
Question 7: The principle of transparency…
a) allows members and traders to know what are the rules affecting trade.
b) is directly linked to the Trade Policy Review Mechanism (TPRM).
c) relates to the dissemination of information through a number of WTO databases.
d) allows enhancing the understanding of regional trade agreements.
e) all of the above
Question 8: The MFN obligation applies…?
a) To WTO Members and governments in process of accession.
b) To WTO developed Members only.
c) To WTO Members who are signatories of the MFN Agreement.
d) To WTO Members.
Question 9: What do the tariff commitments in the “WTO schedules of concessions” for trade in goods reflect:
a) Minimum tariff levels.
b) Applied tariff levels.
c) Maximum tariff levels.
d) Schedules containing only quotas.
Question 10: For trade in goods, the main principles of the WTO do NOT include:
a) the most-favoured-nation (MFN) principle
b) the national treatment principle
c) the general prohibition of tariffs
d) the general prohibition of quantitative restrictions
Question 11: The general exceptions laid down in Articles XX of the GATT 1994 allow Members to derogate, under certain conditions, from one or more obligations contained in the GATT for the purpose of:
a) protecting non essential security interests
b) facilitating structural adjustment of the domestic industry
c) protecting their balance of payments
d) protecting human, animal or plant health
Question 12: Which of the following statements regarding Regional Trade Agreements (RTAs) are CORRECT?
a) Under the GATT, RTAs take the form of free-trade areas or customs unions.
b) WTO Members are allowed, under certain conditions, to depart from MFN principle.
c) Free trade areas are more prevalent than customs unions.
d) RTAs can cover both goods and services.
e) a), b) c) and d).
Question 13: Which of the following describes the practice of “dumping”?
a) The export of a product at a price higher than the price of that same product in the market of the exporting country.
b) The export of a product at a price substantially lower than the price of that same product in the importing country.
c) The export of a product at a price made artificially competitive by a subsidy given by the government of the exporting country.
d) The export of a product at a price lower than the price of that same product in the market of the exporting country.
Question 14: Which of the following determinations are required before the imposition of anti-dumping measures?
a) That there are “dumped imports”.
b) That dumping is causing material injury to the domestic industry.
c) That the exporter had the intention of driving its competitors out of the market.
d) That there is a causal relationship between the injury and the dumping.
e) a), b) and d)
Question 15: The SCM Agreement …
a) regulates the use of subsidies.
b) sets forth disciplines regarding the imposition of countervailing measures.
c) prohibits all subsidies.
d) both a) and b).
Question 16: In case of differences between Members over trade measures:
a) affected Members can bring the case before the International Court of Justice (ICJ).
b) affected Members can bring the case before the WTO Dispute Settlement Body.
c) affected Members can bring the case before the Committee on Agriculture.
d) affected companies can bring the case before the WTO Dispute Settlement Body.
Question 17: The negative consensus rule is:
a) A decision-making rule according to which the WTO Dispute Settlement Understanding applies only to those Members who agreed to be bound by it.
b) One of the most important differences between the GATT and the WTO, according to which consensus is required to adopt the panel’s reports.
c) A decision-making rule which reverses the requirement of consensus for the establishment of panels and adoption of panel and Appellate Body reports.
d) A new negotiating approach that solved the problem of “blocking” the establishment of a panel and adoption of panel reports.
Question 18: The Dispute Settlement Understanding (DSU) covers disputes among all WTO Members arising under:
a) Any provisions of the WTO Agreements.
b) The WTO Agreement, the GATT 1994 and the Trade Policy Review Mechanism.
c) The Agreement establishing the WTO, all the multilateral Agreements on trade in goods, the GATS and the TRIPS Agreements.
d) None of the above.
Question 19: The Trade Policy Review Mechanism (TPRM):
a) applies only to trade in goods.
b) is entirely based on the report of the government reviewed.
c) is a mechanism aimed at reviewing Member’s trade policy regimes.
d) is a mechanism exclusively aimed at reviewing Member’s implementation of WTO commitments.
Question 20: Which of the following statements about the GATT 1994 are CORRECT?
a) It is one of the Multilateral Trade Agreements on Trade in Goods.
b) It includes the basic obligations on trade in goods.
c) It applies to all WTO Members.
d) a), b) and c).
Question 21: Which of the following constitute one of the main pillars of the Agreement on Agriculture?
a) Market access.
b) Domestic support.
c) Export competition.
d) a), b) and c).
Question 22: Which of the following statements about the GATS are CORRECT?
a) The GATS covers services supplied under the exercise of government authority.
b) Each WTO Member is required under the GATS to submit a Schedule of specific commitments for trade in services.
c) GATS Schedules contain specific commitments on market access and national treatment.
d) Each Member decides which sectors it wishes to commit in its Schedule.
e) b), c) and d)
Question 23: Which of the following statements about the TRIPS Agreement are CORRECT?
(a) Aims at promoting effective and adequate protection of intellectual property rights and ensuring that measures to enforce these rights do not become barriers to trade.
(b) Is based on the main conventions of the World Intellectual Property Organization.
(c) Includes the fundamental rules on national treatment and MFN principle.
(d) Recognizes Members’ right to adopt measures for public health reasons.
(e) All of the above.
Question 24: The TRIPS Agreements includes provisions on..
a) trademarks.
(b) geographical indications
(c) patents
(d) enforcement procedures to permit prompt and effective action against any act of infringement of intellectual property rights.
(e) all of the above.
Question 25: Which of the following statements regarding the Doha Round of negotiations are CORRECT?
a) The overall conduct of the negotiations is supervised by the Trade Negotiations Committee.
b) The development aspects of the negotiations permeate all negotiating subject areas.
c) A number of Members have formed groups or coalitions on the basis of geographical links or common positions in the negotiations.
d) a), b) and c).
Question 26: What is the Doha Development Agenda?
a) A work programme setting new deadlines for the implementation of WTO Agreements by developing Members, which was agreed upon at the Doha Ministerial Conference.
b) A work programme, which was agreed upon at the Doha Ministerial Conference and is related to the inclusion of a development dimension into the WTO Agreements.
c) A work programme connected to the launch of a new negotiations round at the Doha Ministerial meeting on labour standards, investment and competition policy.
d) A work programme agreed upon by Members at the Doha Ministerial meeting and related to the launch of a new round of negotiations on a range of WTO subjects with special emphasis on special and differential treatment for developing countries.
Question 27: In the WTO, monitoring and surveillance relates directly to …
a) WTO Members having resort to WTO dispute settlement mechanism.
b) The principle of transparency and ensuring the implementation of WTO commitments.
c) The principle of special and differential treatment for developing members.
d) The regular review of developed Members’ trade policies only.
Question 28: Which of the following statements about monitoring and surveillance in the WTO are CORRECT?
a) They contribute to enhance the transparency and smooth functioning of the multilateral trading system.
b) They take place in all WTO bodies and committees.
c) They flow, generally, from Members’ obligations to publish domestic regulations and to notify trade measures to the WTO.
d) They aim at understanding and discussing Members’ implementation of WTO obligations.
e) a), b), c) and d)
Question 29: The Transparency Mechanism for Regional Trade Agreements …
a) has been at the conclusion of the Doha Round.
b) is being implemented on a provisional basis and will be replaced by a permanent mechanism to be adopted as part of the Doha Round.
c) applies to all RTAs whether notified under Article XXIV of the GATT, Article V of GATS or the Enabling Clause.
d) both b) and c).
Question 30: The WTO provides a framework for member governments to:
a) agree on global rules applicable to their international trade relations
b) meet regularly and consider information provided by the members to the WTO
c) review each member’s trade-related policies and practices
d) settle their trade disputes
e) all of the above
Question 31: Which of the following is a source of gains from trade?
a) Gains from specialization and a broader variety of goods and services
b) Gains from more competition and lower prices
c) Gains from exploitation of economies of scale
d) All of the above are sources of gains from trade
Question 32: According to the MFN principle the treatment of an imported product originating from a WTO Member shall be as favourable as the treatment given to:
a) an imported “like product” from any other country
b) an imported “like product” from any other WTO Member
c) imported products from any other WTO Member
d) products produced domestically
Question 33: The National Treatment principle in Article III of the GATT 1994:
a) prohibits Members from discriminating between like products from different WTO Members
b) prohibits Members from applying certain internal measures on products of other WTO Members
c) prohibits Members from favouring their domestic products over imported like or directly competitive products of other WTO Members
d) prohibits Members from favouring imported products over their domestic products
Question 34: The general exceptions laid down in Articles XX of the GATT 1994 allow Members to derogate, under certain conditions, from one or more obligations contained in the GATT for the purpose of:
a) protecting non essential security interests
b) facilitating structural adjustment of the domestic industry
c) protecting their balance of payments
d) protecting human, animal or plant health
Question 35: Which of the following statement regarding Regional Trade Agreements (RTAs) are CORRECT?
a) Under the GATT, RTAs take the form of free-trade areas or customs unions.
b) WTO Members are allowed, under certain conditions, to depart from the MFN principle.
c) Free trade areas are more prevalent than customs unions.
d) RTAs can cover both goods and services.
e) a), b), c) and d)
Question 36: Which of the following statements about the TRIPS Agreement are CORRECT?
(a) Aims at promoting effective and adequate protection of intellectual property rights and ensuring that measures to enforce these rights do not become barriers to trade.
(b) Is based on the main conventions of the World Intellectual Property Organization.
(c) Includes the fundamental rules on national treatment and MFN principle.
(d) Recognizes Members’ right to adopt measures for public health reasons.
(e) All of the above.
Question 37: Which of the following statements about the WTO dispute settlement system are CORRECT?
a) Only WTO Members have the right to participate in WTO disputes.
b) It has been designed to ensure the enforceability of Members’ rights under the WTO covered Agreements.
c) The first formal stage of the process is consultations.
d) a), b) and c)
Question 38: Which of the following statements about monitoring and surveillance in the WTO are CORRECT?
a) They contribute to enhance the transparency and smooth functioning of the multilateral trading system.
b) They take place in all WTO bodies and committees.
c) They flow, generally, from Members’ obligations to publish domestic regulations and to notify trade measures to the WTO.
d) They aim at understanding and discussing Members’ implementation of WTO obligations.
e) a), b), c) and d).
Question 39: Aid for trade …
a) doesn’t cover productive capacity building and infrastructure for developing Members.
b) aims at helping developing countries, particularly LDCs, to remove internal barriers that prevent them from benefiting from trade liberalization.
c) is seen as a valuable complement to the Doha Development Agenda.
d) both b) and c).
 
Place your order now for a similar paper and have exceptional work written by our team of experts to guarantee you A Results
Why Choose US   :
   6+ years experience on custom writing
   80% Return Client
   Urgent 2 Hrs Delivery
   Your Privacy Guaranteed
   Unlimited Free Revisions

The post International trade relations appeared first on homework handlers.

Peaceful Rest Motor Lodge

/in /by

Peaceful Rest Motor Lodge
Peaceful Rest Motor Lodge
Instructions for Case Analysis
1. Read the case.
2. Review the case grading rubric found in your syllabus.
3. Prepare your written analysis.
Use the following headings to organize your case analysis:
• Critical Issues
• Evaluation of Alternatives
• Support of Recommendations
Your literature review should be included throughout your analysis. You should cite references to substantiate your evaluation of alternatives and support of recommendations. You may also cite references which provide more depth in theory and knowledge regarding the case topic.
4. Things to keep in mind…..
Use marketing concepts from your chapters and references to analyze the case. Don’t spend too much time summarizing the case – a few sentences will b e sufficient since I have read the case already.
Your analysis should include a swot analysis which can be part of the critical issue section. Your alternatives and recommendation should link back to your critical issues and swot analysis.
The body of your analysis should not exceed 6 pages, double spaced, 12 point font. You also should include a title page and a reference page. Cite al of your references properly in APA format (APA 6th edition or higher).
Submit your case analyses in the appropriate dropbox. The document should be compatible with Microword 2007/2010/2013.
You should use a minimum of 5 external resources, not including your textbook, to support your analysis. You may not use Wikipedia and other encyclopedias. At least two of your references must be from referred journals.
RUBRIC FOR CASES: 100 Points Total
Criteria Identifies Major Issues of the Case Considers Stakeholders Analyzes Alternatives and Consequences Chooses an Action Total
Points:
Exceeds Expectations (25 Points) Identifies the major issues of the case AND related issue(s) IdentifiesstakeholdersAND discussespotentialimpactonstakeholders Clarifies TWO or More alternative actions and discusses possible consequences to the stakeholders Identifiesacourseof actionwithsufficientdetailthatindicatesathoughtfulreflectionofthebenefitsandrisksoftheaction.
Meets Expectations
(20 Points) Identifiesthe major issues of the case, but does NOT identifyrelatedissue(s). Identifiesstakeholdersbut failstodiscusspotentialimpactonstakeholders Identifies at least One
alternative action andpredictsthe consequences on stakeholders Identifiesacourseof actionbut fails to correctly discuss the benefits and risks of the action.
Needs Improvement
(15 Points) Doesnotidentifythe major issue of the case or identify related issue(s) Failstoidentifystakeholders DoesnotidentifyAlternativesorincorrectlyidentifiesalternatives. Doesnotidentifyan appropriateplanofaction.
Course Book: Basic Marketing
A Marketing Strategy Planning Approach
Nineteenth Edition
Case 9: Peaceful Rest Motor Lodge
This case describes the typical production-oriented businessperson who designs a product to satisfy himself. As a traveling businessman, he had been in many motels and now has bought one that would have satisfied him as a traveling businessman. Unfortunately, however, most of his potential customers are tourists and vacationers, and only a few traveling businesspeople.
His motel is probably seen as an emergency product by some tourists, and a homogeneous shopping product by others who are just looking for an economical place to stay. He is probably losing most of those who think of motels as heterogeneous shopping products (those who drive in and out again) and those who have advance reservations at preferred locations (specialty products).
If Tristan Knaus wants to continue with his present “economical traveler” strategy, he probably should consider raising prices some. There is no point in “giving away” his rooms. This will not increase the occupancy rate, but it may increase profits. Or, depending upon his present customer mix, he might decide to raise prices even higher and count on the “emergency product” business. Whether this is a good alternative depends upon the mix of his present customers. If most of them come in late in the evening and stay only one night, then he might want to rely on place convenience to attract enough of these people at higher rates to make his motel profitable. To help attract more of this kind of business, he might want to invest some money in signs away from his present location. In fact, this probably would be desirable whether he goes down the emergency product route or stays with his low price-oriented approach. People have to know where you are – or be able to find you – to buy – and his motel is not located in the heart of the resort area nor just off the new state highway.
Affiliating with Days Inn of America, Inc. is the “next step” beyond the possibilities discussed above. The major advantage of going with Days Inn is the additional business which would be generated by the reservation service and perhaps people who would pull in because they recognize the Days Inn brand. Because no other Days Inn is nearby, it is likely that additional business would be obtained – but not necessarily the 40 percent suggested in the case because Tristan may already be getting some of the typical “price-oriented” customers who happen to be in the area. And given that Tristan would have to pay 8 percent on the total gross room revenues (not just those generated by the reservation service) he should analyze the likely profitability with and without the reservation service. In fact, he should do this for the various alternatives discussed above as well as the two franchise alternatives he is considering. Such an analysis would probably show that the Holiday Inn alternative is less attractive than one or more of the others, because of the required improvements and the unlikely increase in sales given his poorer location (away from the resort area). In contrast, proximity to the interstate highway may improve the likely results of going with Days Inn. On the other hand, if being near this intersection is attractive to motel operators, he should expect to see one or more motels being placed near his motel – but closer to the intersection with the major highway. Then his slightly poorer location and lack of a national affiliation may turn out to be “killers.” That is, he would not be in the resort area or “just off the highway,” and he would not be affiliated with any national brand. He might be in an “empty box” on the market grid for motel service, and his losses could grow.
Depending on the instructor’s objectives, it is possible to push the analysis of the numbers in the case a bit further. This doesn’t bring some clear resolution to the issues and is not intended to be a substitute for a look at the qualitative issues, but it can help students realize that a “rough cut” at a profitability analysis can sometimes be useful even if there is a lot of missing information. For example, we know that the motel has 60 rooms and that it has a 55 percent occupancy rate. So, on average, that means Tristan is renting about .55 x 60 or 33 rooms a night. The rooms rent at about $45 a night, so the average daily sales revenue is about $1,485. If you multiply that times 365 days in a year that means the total revenue at present is about $542,025.
The profit picture with either Holiday Inn or Days Inn would depend on a variety of factors, but probably the most significant ones would be (1) the interest expense on any loan to make the capital improvements, (2) the occupancy rate actually realized, (3) the price per night that would be charged, and the fee earned by the chain (which at present is the same for either chain, 8 percent of gross revenue).
The case does not explicitly say what price Peaceful Rest Motor Lodge would charge per night per room if it were part of the Days Inn chain nor does it state what occupancy rate might be achieved. However, if the occupancy rate went up to the average level for this type of hotel (68 percent), that would be an increase in occupancy of about 24 percent (that is, 68 percent average occupancy minus 55 percent current occupancy is a 13 percent increase, and 13 percent divided by the current rate of 55 percent is about 24 percent growth). Most of the expenses of running the hotel are probably fixed, and the variable cost of renting out a room is not very high (laundry, wear and tear on linens, utilities, and maid service), so it is likely that this would result in much higher revenue for Peaceful Rest Motor Lodge, even after paying the 8 percent “commission” on gross sales. For example, if the room rate per night stayed the same as it is now and the occupancy rate only went up to the industry average, Peaceful Rest Motor Lodge’s revenue (after paying the fee) would be about $618,342. This is the result when you increase the current revenue by the 24 percent increase in occupancy (which gives you about $672,111) and then subtract 8 percent of that amount in fees (which is .08 x $672,111 = $53,768). Thus, under this scenario, revenue would increase from about $542,025 to about $618,342, or a change of about $76,317. That extra revenue would come at a cost since there would be about an extra 8 guests per night or about 8 x 365 = 2,920 extra guest nights per year. However, if you divide the extra revenue by the extra “guest nights” you get $76,317 / 2,920 or about $26 per guest night. Since it is unlikely that it would cost this much to clean the rooms and keep them in shape, this looks like it might be a more profitable arrangement than what is happening at present. If could be quite a bit more attractive if the room rate could be higher, the occupancy rate higher, or both happened at the same time. Note that the point here isn’t to be precise so much as it is to show that one can work with what little information is available to “get a handle” on the financial side of this issue.
The Holiday Inn arrangement requires more cash up front but that is offset by higher room rates. For example, if the occupancy rate went up to the industry average (68 percent) and the rooms could rent for $75 per night on average, the total revenue would go up to about $1,027,549 (after paying the fee). This is the result of multiplying 60 rooms x .68 occupancy rate which is 40.8 rooms (on average) per night or about $3,060 per night in revenue multiplied by 365 nights per year is about $1,116,900 gross revenue, from which 8 percent ($89,352) must be subtracted for the fee. So, if the average occupancy rate could be achieved at the higher price, the increases in revenue in the first year would almost be equal to the cost of making the improvements to the motel. Of course, there might be associated increases in other variable costs to meet the Holiday Inn standards, but it still appears that the break-even on the investment might not take as long as it might at first appear–and after that profits would be quite a bit higher. But, this is based on the assumption that the occupancy rate would really increase significantly, and that may be unrealistic even with the Holiday Inn reservation system kicking in. The Peaceful Rest Motor Lodge location is a bigger disadvantage – and one he can’t easily change–if he really wants to compete against the other better quality motels.
In net, this rough analysis suggests that either the Days Inn or Holiday Inn affiliation might be more profitable than what Tristan is achieving at present. It would take a more complete analysis, including other qualitative factors, to clearly determine which might be better. But, on the surface, it looks like it would be a “big leap” for Tristan to compete effectively against other higher-priced motels in the area. In that regard the Days Inn arrangement looks like a potentially better fit.
Place your order now for a similar paper and have exceptional work written by our team of experts to guarantee you A Results
Why Choose US   
    6+ years experience on custom writing
    80% Return Client
    Urgent 2 Hrs Delivery
    Your Privacy Guaranteed
    Unlimited Free Revisions

The post Peaceful Rest Motor Lodge appeared first on homework handlers.

Directions on Research Problem Solving paper:

/in /by

Directions on Research Problem Solving paper:
This is criminal justice problem solving paper I must write on how to reduce the rate of recidivism in offenders.  I submitted a problem proposal form to my professor in which I lightly explain how I will resolve this issue,therefore it is important to resolve the issue based on that that I wrote. I will add to this document the problem proposal form where I identifythe solution of this issue “Review all of the current rehabilitation programs and treatment services that are being provided for the offenders that are being incarcerated and see if there is any way to revamp or possibly create new community based programs.  Make recommendations that will allow the state to accomplish the purpose of reducing the rate of recidivism in offenders.”  It does not only have to be only one way to solve the issue, but it is important I address what I put on the proposal form (what is highlighted) . I must have 10 scholarly sources in total (including or not the one on the proposal form, which I addressed three) in other words, all three of them must be used in the research paper with an additional 7, BUT if you don’t find the ones I mentioned in the proposal helpful to write the research, you can remove the ones I have and add another ones. As long as there is 10 in total.
In addition, I will attach the instructions for writing my research solving paper below the proposal form; it specifies clearly by the instructor the requirements as in the number of pages, what is needed as a minimum to be included in the body of the paper.
PROBLEM SOLVING PAPER PROPOSAL FORM:
A.    Identify the specific problem to be addressed and solved:
How to reduce the rate of recidivism in offenders.
B: Identify the administrator (police chief, president judge, warden, etc.) and type     of     agency (police, courts, corrections, etc.) facing this problem.
The administrator facing this problem is the commissioner of Department of Correction (Commissioner Coup).  Type of agency facing this problem is Department of Corrections.
C.Explain in detail why your problem is an important or a serious concern for the identified criminal justice, police, court or corrections administrator.
The problem of increased rate of recidivism is important and a serious concern for the Department of Corrections because there is only so many offenders that the states can house within the correctional facilities available, if there are too many offenders within the facilities, overcrowding happen, and leads to violence in prisons such as physical abuse, and other additional problems.
D.    Explain or describe the specific potential negative consequence(s) or impact(s) if the problem is not properly addressed by the identified administrator.
If the problem of reducing the rate of recidivism is not properly addressed, the administrator will have to face additional problems such as overcrowding.  Due to overcrowding, the less serious offenders are being released without proper rehabilitation time. If we do not adequately rehabilitate these offenders will most likely reoffend for a more serious crime and with this, back to the correctional system.
E.    Provide some information about what you hope to accomplish in your Paper regarding the problem and how that would assist the identified administrator.
Review all of the current rehabilitation programs and treatment services that are being provided for the offenders that are being incarcerated and see if there is any way to revamp or possibly create new community based programs.  Make recommendations that will allow the state to accomplish the purpose of reducing the rate of recidivism in offenders.
F.    Proposed problem is related to the which Goal and Course Learning     Outcome(s) located in the Course Information and Schedule located in the Syllabus     area of the Course menu (provide both the numbers and what the Goal and the     Outcome(s) state):
Week 5:
CHAPTER 10 OBJECTIVES (Corrections Organization and Operation; pages 200-230)
10-1    Describe the general features of a correctional organization in the United States, including the
levels of correctional incarceration, employment, expenditures, and several factors affecting
prison and jail populations
10-6.    Relate the nature and extent of litigation by prison and jail inmates, including the rationale,
provisions, and impact of the Prison Litigation Reform Act (PLRA)
CHAPTER 11 OBJECTIVES (Corrections Personnel Roles & Functions; pages 231-248)
11-1.    Describe in general the duties of prison, jail, and probation and parole administrators and their
employees
11-2.    Review the type of training that is available to new wardens to help them be successful, and the
principles of good prison leadership
11-5.    Relate the duties and types of correctional officers
11-6.    Delineate and describe several key issues for, and practices of prison administrators, to include
achieving racial balance, managing staff deviance, and maintaining appropriate staff-inmate
relationships
11-7.    Explain how jail administrators can motivate and retain jail employees
CHAPTER 12 OBJECTIVES (Corrections Issues & Practices; pages 248 – 272)
12-2.    Delineate several issues and problems concerning inmate populations: sexual and physical
violence, issuing condoms to inmates, hostage taking, and dealing with mentally ill and geriatric inmates
12-4.    Describe the problem and possible solutions of drugs in prisons and jails
12-5.    Articulate the general approach used to drug abuse by a therapeutic community, and kind of
approaches that seem to work best
J.    List in APA Format, three scholarly references of the required 10 that might be used    in your paper.
K., & Thomas, M. F. (2015, September 25). RECIDIVISM IN DELAWARE An Analysis of Prisoners Released in 2008 through 2010. Retrieved from http://cjc.delaware.gov/sac/pdf/Justice/Recidivism in Delaware; An Analysis of Prisoners Released in 2008-2010.pdf
State of Delaware – Search and Services/Information. (n.d.). Retrieved February 06, 2016, from http://www.doc.delaware.gov/treatmentServices.shtml
T. C., & J. W. (n.d.). Pennsylvania Department of Corrections Recidivism Report 2013. Retrieved from http://www.nationalcia.org/wp-content/uploads/2013-PA-DOC-Recidivism-Report.pdf
Instructions on Administration of Criminal Justice
Course Problem Solving Research Paper Requirements and Instructions
I. Introduction
A.    ASSIGNMENT SUMMARY
1.     A major componentof this course is the completion of a Course Problem Solving Paper (160 points             or 20% of the total points possible for the Course).
2.    The Course Problem Solving Paper must include primary source material addressing a specific                 contemporary and important or serious problem requiring a solution by an administrator of a criminal             justice agency such as police, courts, probation and parole or corrections as well as be related to                 one or more of the Course Goals and Learning Outcomes and Textbook Chapter Objectives.
B.    PRIOR APPROVAL IS NEEDED FOR SELECTED PROBLEM
1.    Papers submitted without specific Instructor approval of the problem to be     addressed will                 receive a grade of zero
a.   All too often in the real world, attempts are made to solve problems before the problems are                     precisely identified. Prior approval of the problem to be addressed is required to insure that                     before beginning research, students are researching legitimate problems and then writing and                 submitting papers/reports that meet the requirements rather than learning after submission,                     that the problems contained in the papers/reports were not properly identified nor addressed.
b.    It might be easier for both the students and Instructor, if a listing of problems were made                         available for students to simply select one from. Although easier, that process may not serve                     the student well in learning how to solve problems since that eliminates learning and gaining                     experience in correctly identifying a problem to be solved, which is a major important but often                 difficult component of the problem solving process.
C.    SUBMISSION OF PROBLEM FOR APPROVAL
2.    Students must submit a completed Problem Proposal Form/Template to the Instructor by                         the end of the first week of the course. Submit the Problem Proposal Form/Template via                         the     Problem Proposal Form Assignment Link in the Week One Activities area, no later                         than the end of Week One of the course.
3.    A blank Problem Proposal Form/Template is provided in an attachment in this folder. That                     Form/Template in Word format in the attachment should be used by students to                                 submit Proposals.When using the Form/Template, keep the instructions on the form and simply                 provide responses after each instruction or question.
D.    ONCE APPROVED, DO NOT CHANGE YOUR PROBLEM WITHOUT INSTRUCTOR APPROVAL.
E.    If you have questions, please ask. I would rather grade a good paper than a poorly written paper. I want         you to be successful and learn. I would rather assist you in the preparation than have to make critical             comments in the grading process. Again, the Wilmington University Library web site or the University’s         Student Success Center both have information about grammar, writing and APA Format that may be             useful. Access to the Library may be made through the “Library” area located in the Course Menu.             Access to the Student Success Center can be made either through the Library or through the link                 provided in this Syllabus area.
II. Paper Requirements and Instructions
A. Problem/Topic Information:
1.    Students are required to identify a problem which must:
a.    be a contemporary and important or serious problem requiring a solution by an administrator of a criminal justice agency such as police, courts, probation and parole or corrections,
b.     if not properly addressed, will result in specific negative impact(s) upon the administrator and/or his/her agency, and
c.     be related to one or more of the Course Goals and Learning Outcomes and Textbook Chapter                 Objectives.(See the Class Information and Schedule in the Syllabus area in the Course Menu                 to the left of your screen for a listing of the Course Goals and Learning Outcomes as well as the                 Listing of Textbook Chapter Objectives in another section of the Syllabus).
2.    The problem selected should not be so broad or general in scope that the Paper results in asuperficial, general orsummary overview of information about the problem but onewhich requires research by a student as to the relevant information available about the problem, analysis of that information and then student recommendations as to what is the best course of action which could  be followed by an administrator to address the problem in his/her agency.
3.     In attempting to identify a problem for the Paper, the student should assume the administrator has     some training and understands general basic information on many administrative subjects including     historical informationabout a subject but often there is a specific need for more information (legal     requirements, current professional standards, solutions recommended or warnings issued by     experts), on a specific problem within a subject area that an administrator must have in order to     make decisions as to what to do in regard to solving a problem.
4.     As you consider a possible problem for use as the topic, ask yourself if itis too general and broad or     does it identify a specific problem that a CJ administrator (chief or commissioner of a police     agency, president judge of a court system, or the commissioner or warden of a prison) might have     requiring some research on what is currently available information that you can analyze                 and then determine what needs to be done to correct and resolve it to avoid any negative     impact(s)?For example:
(a). One might think that the topic of Homeland Security would be an important concern and it             is, however most administrators already know something about that subject due to their                 education, training or experience in an organization.
(b). Within that general subject, specific problems might be:
(1).    Are there any weaknesses in the Department of Homeland Security’s requirements for                 local law enforcement and what must be done to correct     them;
(2). What are the Federally mandated Homeland Security requirements for a local law                     enforcement agency and how does an administrator implement them into an agency’s                 operations?
5.    If you are having a problem selecting a topic, look through the Table of Contents, the     Chapters, and      the     Index of your Textbook, the Course Learning Outcomes, and the List of Textbook Chapter     Objectives. Select an item that is a problem and is not fully covered that also meets the         requirements of the paragraphs above and which requires more reading and research to assist you    in more fully understanding the subject and its impact upon the administration of a criminal justice     agency.
6.    It is strongly suggested that a previous paper from another course not be used due to the specific     requirements stated above.Many Course/Term Paper topics often result insimply providing     information     about a topic and do not involve using a problem solving process. Students previously     attempting to use a paper from another course, even with the permission from both the current and     former instructors, have not been very successful in relating the material from the previous paper to     the     specific focus for this paper resulting in a paper not only failing to meet the requirements but     also not eligible for the best grade possible.
7.    After selecting a problem, submit it with the other required information on a Problem Proposal     Form/Template for grading and approval of the topic from the Instructor before commencing work     on the paper.
8.    If after submitting the problem on the approval form, and if further communication between the     student     and instructor is needed before approval can be given, the student will be contacted by the     Instructor by email.
9.    The Problem Proposal Form is due the last day of Week One.This then gives a student     approximately 5 weeks to work on the paper.
B.    Paper Length
1.    The paper must be 8-10 pages not counting the title/cover and reference pages.
2.    The paper is to be double spaced.
C.    Source material
1.    Students are required to use 10 differing primary sources in the form of actual text or periodical                 literature. Periodical literature can include academic journals, law journals, professional journals,                 peer reviewed government research reports (such as NIJ Reports), and research projects                     conducted by private agencies such as the RAND Corporation. Web locations or Net resources may             not be scholarly source material.Government web sites containing scholarly research reports,                 research data, and Congressional testimony are acceptable and encouraged.
2.     Wikipedia is unacceptable as an academically reliable reference source.  NO EXCPTIONS.
3.    The Textbook should be listed as a reference and should be cited in the Paper as required in the                 Course Problem Solving Paper Rubric but it will not be counted as one of the required 10 primary                 sources.
Textbook cited: Peak, K. (2016). Justice administration: Police, courts, and corrections management (8th ed., pp. 136-137). University of Nevada, Reno: Pearson Education, Inc.
4.     Newspaper articles and other news sources containing relevant current information may be used                 but only two of those listed will be counted toward the required 10 primary sources.
5.    Other sources may be considered on a case-by-case basis. Ask first.
D.    Paper Due Date
1.    The last day of Week Six.
2.       The Paper MUST be first submitted by the student through the Safe Assign Draft link to check for             Plagiarism. Submit for draft early in Week Six to allow time to read the report and if needed, make         any corrections and then, submit again via the Safe Assign link for grading located in the Week Six         Activities area.
E.     Style Manual
1.    The required style manual for this paper is APA 6th edition.
2.    The Library web site provides resources for using APA 6th edition. That information may be                     accessed through the “Library” area to the left of your screen in the Course Menu. The Student                 Success Center also provides information which can be accessed either through the Library link or             the Student Success Center link in the Syllabus area of the Course Menu.
F.   Academic Dishonesty
1.    Academic Integrity is addressed as a specific topic here, in the current Student Handbook, and in another section of this Syllabus area of the Course Menu. The following are forms of academic dishonesty. These practices will not be tolerated:
a.    Plagiarism:Plagiarism is the inclusion of someone else’s words, ideas, or data as one’s own.                     When a student submits work that includes the words, ideas, or data     of another, the source of                 that information must be acknowledged through     complete, accurate, and specific references,                 and, if verbatim statements are included, through quotation marks or similar denotation as well.                 When the student places his or her name on submitted work, the student certifies the     originality                 of all work not otherwise identified by appropriate acknowledgments. Plagiarism covers                         published and unpublished sources.
b.    Falsification: Falsification consists of deliberately changing results, statistics, or any other kind                 of factual information to make it suit your needs. It also consists of deliberately changing a                     source’s intent by misquoting or taking out of context.
c.    Multiple submissions: If you wish to turn in the same work or use the same research, in whole or                 in part, for more than one course, you must obtain permission to do so from all professors                     involved. Failure to obtain this permission constitutes academic dishonesty. If using a paper or                 research from a paper from or for another course for this course, you need to submit the name                 and number of that other course as well as the name of the Professor and the e-mail address of                 that individual, along with a statement from you that you have contacted that other Professor                     and have his/her permission to submit the paper and/or research for this Course’s Term Paper                 requirement.
2.    This “Syllabus” areaand this folder haveadditional information on these items and Safe Assign.                 You should review that information prior to writing your paper.
G.    Course/Term Paper Format
1.    Title or Cover Page: Page 1 of your paper but it does not count toward the length or minimum                     number of pages in your paper Use APA 6thEdition format precisely for this task.
2.    Abstract Page:
a.     On page 2 of your Paper, an Abstract is provided to give the reader an immediate                             understanding of what your paper is about. An abstract summarizes, the purpose, methods,                     scope, results, conclusions, and recommendations included in your report.Address briefly why                 you did the Paper, what you did, how you did it, what you found, and     what those findings signify
b. The abstract should allow the reader to decide whether or not to read the rest of the Paper.The                 abstract is not a duplication of the introduction in the body of the Paper. The introduction is                     much more extensive.
b.    According to the APA style manual, an abstract should be between 150 to 250 words and that                 is the reason or need for brevity when writing it.
c.      The abstract should be     written as only one paragraph with no indentation.
d.     It is suggested that an Abstract:
(1). Be written last, after you have written the body of your paper.
(2).    Avoid phrases like, “This paper will look at…; I researched” or “it was researched.” Use                         instead words like “research shows.”
3.    Body of the Paper:
a.    The body of the paper with the Title at the top of the page, begins with the Introduction Heading                 and runs continuously with each succeeding heading until the end of the paper).
b.    The Course Problem Solving Paper body must contain the following headings as a minimum:                    (1).    Introduction: (In this section you need to provide an introduction identifying the topic                         and direction your paper is going.)
(2).    Literature Review: (This section requires you to seek out the published information on your                     problem and report it in this section. You cannot include everything so you must choose                         wisely the most relevant information. Use paraphrasing extensively making sure to cite the                     source of the information in the text using the format provided by APA 6th edition. You may                     provide limited use of direct quotes where paraphrasing will lose the intent of the original                         author. Proper citation in the text of the original source is important to avoid Plagiarism.)
(3).    Analysis: (The student will provide an analysis of the critical issues identified
in the literature review. This does not include the student’s recommendations. That is                             presented in the next section).
(4).    Recommendations: (Based on your research of the literature and the identification of the                     critical issues, make recommendations for how you believe an administrator(a police chief                     in a law enforcement organization, president judge, chief prosecuting attorney, chief                             probation officer, warden, etc) should proceed to address the issue, problem, concern.
(5).    Conclusion: (Summarize the paper identifying the main themes you want readers to                             remember about the paper. One or two sentences are inadequate for this task. It usually                         takes a minimum of two well-developed paragraphs to do this and often several paragraphs                     depending on how well you concisely write the summary.)
c.    Additional subheadings may be added at each student’s     discretion.
4.    Reference Page(s): (Does not count toward the number of pages in your paper)(The reference                 page(s) begins with the heading on a new page and lists all references used in the paper. Make                 sure you use APA 6th Edition format to properly list each reference. Cross check your citations in the             text of the Paper with the references listed to make sure they correctly match.)
III. Assessment
A.    Papers will generally be assessed for:
1.    Scholarly research,
2.    Analysis & critical thinking,
3.    Relevance to the problem and solution being addressed in the Paper,
4.    Adherence to:
a.     APA 6th Edition Style Manual, and
b.     the requirements and format identified in this document, as well as the criteria identified in the                 Course Problem Solving Paper Rubric. It is strongly suggested that before submitting the Paper                 for grading, that the Rubric be used by the student as a checklist to ensure that all areas subject                 to grading have been properly addressed by the student.
5.    Organization of the material presented,
6.    Attention to proper grammar, punctuation, spelling, etc.
B.    For specific grading criteria and possible points for those items, see the Course Problem Solving Paper         Rubric located in the Rubric area of the Course Menu.
C.    Common errors made on term papers:
1.    Failure to submit a well prepared proposal
2.    Failure to follow the format requested, especially the use of the required fiveheadings that must be         identified in the body of the paper
3.    Failure to list references in APA 6th Edition format.
4.    Failure to follow the instructions for the paper
5.    The paper is merely descriptive. No analysis is provided.
6.    Failure to properly cite material in the body of the paper using APA 6th Edition format.
7.    Overuse of quotations
8.    Plagiarism. Yes, your work is checked. Fortunately instances of plagiarism are not frequent but             most are caught due to electronic capabilities to identify plagiarism. If not required by an                     Instructor, it is strongly suggested that a Paper be submitted by the student through Safe                     Assign to check for Plagiarism. In this Course, it is required that the Paper be submitted twice             through Safe Assign. It is first submitted early in Week 6 as a draft in time to allow for a draft check         and report back to the student, time for the student to make any corrections if needed and then final         submission for grading through Safe Assign before the end of Week 6 of the Course.
9.    Use of the course textbook as a primary sources. Although the Course Textbook is not counted as         one of the 10 primary sources, it should be listed as a reference and cited in the Paper as frequently         as is needed and indicated in the Course Problem Solving Paper Rubric.
10.    Use of non-approved references
11.    Poorly selected sources, not following the directions on selection of sources
12.    Failure to ask about specific resources that the student is unsure about. Ask if you are unsure.
13.    Use of Wikipedia as a reference. Wikipedia is unacceptable as an academically reliable             source.  NO EXCPTIONS.
14.    Failure to fully research the topics.
15.    Failure to properly edit work resulting in typos, grammatical errors, misspelling, and incorrect                 punctuation.
16.    The paper covers a broad topic rather than narrowing the topic and providing specific information             and analysis. Broad generalizations with no depth of analysis or evidence of intellectual reasoning         will often result in a poor paper.
17.    Failure to use intellectual reasoning; instead, relying on emotional responses to the topics.
18.    Poor organization of main points. Note: Use the required five headings and create subheadings as
For a custom paper on the above topic or any other topic, place your order now!
What Awaits you:
• On-time delivery guarantee
• Masters and PhD-level writers
• Automatic plagiarism check
• 100% Privacy and Confidentiality
• High Quality custom-written papers
 

The post Directions on Research Problem Solving paper: appeared first on homework handlers.

LOAN TRANSFERS

/in /by

LOAN TRANSFERS
Achilles Bank (“Achilles”) is proposing to purchase a $100 million participation from Priam Bank (“Priam”) by way of a funded sub-participation. The participation forms part of a $500 million syndicated loan (the “Syndicated Loan”) made available to Hector Ltd. Priam is a lender of record under the Syndicated Loan for $400 million.
Advise Achilles on the risks it faces in purchasing the participation by way of funded sub-participation and how those risks might be mitigated.
When writing the advice please consult the attached documents. When citing please follow the OSCOLA rules attached.
Aims:
Readings:
Introduction
 
When a bank extends a loan to a borrower, that loan then represents an asset to that bank and it will appear as such in the bank’s balance sheet until the loan is repaid or written off. The bank may wish to sell that loan in the same way that it may wish to sell other assets that it owns, such as plant or property. A loan is of course more analogous to the holding of a bond or an equity investment but is distinguishable from these in that it is normally less liquid; there will usually be a listed market in bonds and equities but a sale of a loan will have to be arranged by private treaty between the buyer and seller.
 
Why would a bank want to transfer a loan?  The motivation for making a loan transfer can be any combination of a large variety of factors including:
 
 
 
 
 
In continuation, we look at different ways in which a loan can be transferred:
 
 
 
Assignment may be a legal assignment created by section 136 of the Law of Property Act 1925 or an equitable assignment.
 
Legal assignments
 
In order to satisfy the statutory requirements of a legal assignment, the following must be established:
 
 
 
 
There are no rules on how the assignment must be written or how the written notice must be given.[1]  If any of the three conditions of the legal assignment is absent, however, an equitable assignment can still be completed.
 
The effect of completing a legal assignment is that the buyer of the debt acquires all the rights against the debtor that the seller of the debt had. If the assignment is a legal one, the buyer of the debt will completely substitute himself for the seller, he can demand repayment from the debtor and can sue the debtor for repayment without involving the seller of the debt.
 
Not all debts are assignable, however, and even those that are, may lead to limited rights for the assignee. For example, it is often in the interests of a party to a contract that the other party should not be able to assign his rights under the contract. It is common in a sale of land contract to find a clause preventing an assignment by the buyer at least without the seller’s consent. In this way the seller of the land can be sure he will not be forced to transfer the land to a stranger.  Likewise, in a loan contract a borrower may prefer to know his lender and wish to prohibit the original lender form transferring the loan to another bank.  If the loan contract is silent on the matter of assignments, it is assignable but if it clearly prohibits a bank from assigning its rights under the contract, this will render any purported assignment of it invalid inasmuch as the assignor will gain no rights against the debtor who will only need to pay the original lender. A lender in this situation will still be able to make a declaration that he holds the right to receive funds from the debtor on trust for another, but the debtor would repay the original lender.
 
Likewise, the assignment may not increase the burden of the debtor in terms of his legal obligations on the contract assigned.[2] If the loan is assignable, the assignee prima facie obtains the benefit of all aspects of the contract, but if the withholding tax grossing-up clause or other increased costs clause in the loan agreement (see, e.g., clauses 13 and 14 of the LMA loan agreement) would entitle the assignee to demand more funds from the debtor than the original lender could have claimed, the assignee will be unable to claim the additional sum.
 
It is also the case that the assignee can only assume such rights against the debtor as the assignor himself enjoyed. If, for example, the debtor had a counterclaim against the assignor, he can maintain the same claim against the assignee; a debt is not a negotiable instrument. The assignee in such a case may have a right of action on the assignment contract against the assignor, if the counterclaim rights were not disclosed to him.
 
It is also important to note that a party to a contract can only assign his rights under the contract, while his obligations under it remain his to perform. In the case of a loan contract, if the funds have been fully drawn the lender has performed all his obligations and an assignment is capable of completely transferring his side of the contract to the assignee. Where funds can still be drawn by the borrower, however, the assignor can only transfer the right to receive interest on and repayment of what has been lent. He remains liable to lend further sums which may be drawn on the contract, he cannot transfer this obligation to the assignee.[3]
 
When drafting an assignment agreement, it is important to deal with the question of set off, as otherwise the debt held by the assignee may be reduced by set-offs applying to it.  This is especially an issue where the assignor is the main banker to the debtor and operates a number of accounts on their behalf and is maintaining them, apart from the debt being assigned.  Such set-offs may arise as a result of the contractual relationship between the assignor and the borrower or they may arise at equity.  Alternatively, where the debt relates to a contract for the sale of goods, services, land or another debt, there remains the potential for a cross claim arising from the contractual relationship between the debtor and the other party to that contract.  This could result in a set-off reducing the size of the debt in the hands of the assignee.  The contractual approach would be to require the debtor to confirm that:
 
 
When an assignment of the loan takes place, a new contract comes into existence between assignor and assignee. This contract will also have a governing law and this also must be determined by conflict of laws rules and as it is a different contract and one of the parties is different from the loan contract, it may well be that a different governing law has been chosen or that a different country is deemed to have the closest connection to the contract. The law governing this contract of assignment deals with matters such as whether the requirements of the assignment have been met[4], what is the effect of the assignment and what rights the assignee acquires against the debtor. Of course the assignment may be properly perfected under its governing law yet the assignment can still be ineffective because under the law governing the original loan, the loan is simply not assignable.
Equitable assignments
 
As described above, an equitable assignment in English law is one that lacks one or more of the essential requirements of the legal assignment, i.e. that it be in writing, that written notice to the debtor be given and that it be of the whole debt owed by the debtor to the assignor. Each one of these requirements may be objectionable to a lender when he contemplates selling a loan.
 
For instance, it may be that a lender does not wish his borrower to know that he is selling the loan. The lender may be keen to preserve his exclusive relationship with the borrower.  Once the borrower comes to know that the loan has been sold, he may think less highly of the lender of simply decide to deal directly with the assignee next time he requires funds.
 
Similarly, the lender may not wish, or may not be able, to sell the whole loan. This would be for the simple reason that he can get a better overall price for the loan by selling it in tranches or that the loan is of such a size or of such a risk that no one bank would be prepared to buy it all.
 
More strangely at first sight, a bank may also object to the requirement that the assignment be in writing. Normally, both buying and selling banks would insist on such an important transaction being fully documented, but there can be an objection to assignments of loans being in writing and that is because in the United Kingdom, stamp duty is payable on assignments which are priced at over £30,000 and this duty is payable at a rate of 1% ad valorem[5]. Both the £30,000 lower limit and the 1% are based on the price paid for the debt, not on the face value of the loan being transferred. Clearly, most loan transfers are priced at more than £30,000 and a 1% tax represents a considerable disincentive to using the assignment method. Stamp duty is an unusual tax, however, and in this case it is possible to avoid it by ensuring that there is no written document of transfer of the debt which exists in the United Kingdom. This is because stamp duty is only payable on such a written document of transfer and a transfer of a debt which takes place without a written document of transfer is still valid but is not stampable.  Equally, if the written document of transfer is executed outside the United Kingdom, it does not require stamping in the United Kingdom. If it ever enters the country, it must then be stamped. Having said this, the authorities in fact can never compel a person to pay stamp duty[6] but an unstamped document which requires stamping cannot be used in evidence in a court action.
 
There is thus little incentive for the selling bank to have the assignment stamped and a buying bank might be tempted to defer stamping an assignment until such time as it needed to take legal action on the debt, if ever. However, a party who seeks to stamp a document more than thirty days after it was executed (or, if executed outside the United Kingdom, more than thirty days after it was brought into the country) may be charged penalties when it is presented for stamping, in addition to the duty itself. The penalty can include not only interest on the unpaid duty but also a sum equal to the amount of the unpaid duty.[7]
 
Banks can therefore employ various methods to avoid incurring the cost of the 1% duty.
 
You could execute the document outside the United Kingdom in a jurisdiction which does not have its own stamp duty on such documents, such as Jersey.  If it is ever necessary to sue on it in England, bring the document into the country and have it stamped within thirty days of doing so. It will be wise to have clear evidence that the document was in fact executed and kept outside the United Kingdom.
 
 
When the equitable assignment is one where no notice is given of the assignment to the debtor, significant legal issues come into play and it is fair to say that the practical distinction between different types of assignment is not between legal and equitable ones but between those where notice is given and those where it is not. Where notice is not given to the debtor, three factors may arise.
 
First, no new equities and counterclaims which the debtor may have against the selling bank will be able to damage the rights of the buying bank against the debtor as long as they arise after notice of the assignment was given to him. The buying bank always takes the debt he buys subject to existing equities and counterclaims but it clearly increases his risk to be exposed to further matters arising after he buys the debt.
 
Second, if the selling bank is dishonest and sells the same debt more than once, it will be necessary to determine the priorities of the different assignees. This is based on the order in which notice is given to the debtor, known as the rule in Dearle v Hall.[8] The risk for the buying bank of not giving notice of assignment is obvious.
 
Third, as the debtor does not know about the assignment of his debt, he is entitled to repay the original lender, assuming notice has still not been given by the time for repayment. A dishonest original lender could disappear with the funds or he could become bankrupt without having passed the funds onto the assignee. The funds would be held on a trust basis for the assignee, but it could happen that the funds have been dissipated and cannot be traced.
 
 
As an alternative to the assignment method, it is possible to novate the debt instead. As the name implies, this method involves the making of a new contract to replace the existing one. The original loan contract is between Lender 1 and Borrower.  When Lender 2 agrees to buy the debt, a new contract is entered into involving all three parties whereby it is agreed that the original contract will be replaced by a fresh one which provides that Lender 2 acquires all the rights against the Borrower that Lender 1 had.  Since it involves a fresh contract involving the Borrower, this novation method enables both the rights and the obligations of Lender 1 to be transferred to Lender 2 and thus the obligation to lend further sums in a facility which is not fully drawn can be fully transferred to Lender 2.
 
The novation method is the only one which enables a clean break to be made on a facility which is not fully drawn. It has the further advantage that, not being an assignment, no stamp duty is payable. The main disadvantage is that the borrower must not only come to know about, but must also consent to the transfer.
 
Namely, novation requires the consent of all the parties to the original and the new contracts.  This is inconvenient and may present an opportunity for the other parties – and, in particular, the borrower – to extract concessions for its consent. To avoid these, the LMA loan agreement obtains advance consent from all parties (see clause 24.5), although any other terms in the contract concerning procedures and restrictions must be observed, and the device must not simply be a means of trying to dispense with consent altogether.  Any new lender will take on the same terms as if they had been an original lender, including, of course, their consent to future transfers.
 
In addition, there are also problems where the debt is secured, as the process of novation will release any security and it will need to be retaken.  As the charges will now be taken at a later date, prioritisation will be lost if a third party has taken charges over the property in the meantime.  For this reason, it is common in the context of syndicated lending to hold security on trust to avoid problems of this sort.
 
 
You have now seen that both the assignment and the novation methods have their drawbacks in particular situations.  For this reason, the sub-participation method of transferring loans was devised; the most common type is the ‘funded sub-participation’. How exactly does it work?  First, Lender 1 makes his loan to the Borrower.  Lender 1 subsequently enters into a contract with Lender 2 that Lender 2 will lend to Lender 1 a given sum on the terms that Lender 1 does not have to repay Lender 2 if the Borrower fails to repay Lender 1 on the first contract.  By using this method, Lender 1 funds his loan to the Borrower and shifts the risk of non-payment by the Borrower to Lender 2.
 
The method has further advantages. First, Lender 1 may sell any number of parts of the loan to different Lender 2s.
 
Second, in doing so he may turn a profit as there is no requirement that the interest rate payable be the same. Thus a large bank can exploit its position of having a relationship with a borrower with a good credit rating by selling parts of such a loan to smaller banks which would not be able to lend to such a quality credit directly. Lender 1 may be receiving, say, 40 basis points over LIBOR from the Borrower but he may negotiate terms with Lender 2 that he only pays a margin of 35 basis points to Lender 2.
 
Third, sub-participations do not attract stamp duty. Fourth, Lender 1 can keep the transfer(s) totally silent from the Borrower and thus he can maintain his exclusive relationship with him. Finally, if the loan agreement between Lender 1 and the Borrower prohibits assignments by Lender 1, a sub-participation is nevertheless possible.
 
The important distinction between a participation and an assignment or a novation is that the participation is an entirely separate contractual arrangement from the underlying loan agreement and there is, accordingly, no contractual nexus between the participant and the borrower.  In basic legal terms, this means that the participant will not be able to sue the borrower in the event of default by the borrower in performing its obligations under the loan agreement.  It will have to rely on the original lender to take recovery action, although, a well-advised participant will have negotiated certain rights to influence the actions taken by the lender following a default in the participation agreement.
 
The main disadvantage of this method of transfer is that, from Lender 2’s point of view, there is a double credit risk. Lender 2 will not be repaid if the Borrower defaults and he will also not be repaid if Lender 1 collapses. In such a case he would merely be an unsecured creditor of Lender 1.
 
This principle was recently upheld in Lloyds TSB v Clarke and Chase Manhattan[9], where the court confirmed that under a sub-participation agreement, Lender 2 would receive no proprietary rights in the facility.  Hence, on the facts of the case before it, the sub-participant was found to have no claim in the underlying facility and was just an ordinary unsecured creditor in Lender 1’s insolvency.  The Privy Council held that a sub-participation agreement was not a legal term of art like a trust so the fact that an agreement was labelled by the parties as such (as in this case) did not prevent the court from reaching the conclusion that a different legal relationship existed between the parties.
 
Thus, the participant’s position is vulnerable because:
 
 
 
 
From Lender 1’s point of view he remains the “lender of record”, which gives the advantage stated above of maintaining his exclusive relationship with the Borrower, but it also has the disadvantage that he must bear the cost of administering the loan.
 
On first sight, it appears that Lender 1 disposes of all the risk of the Borrower defaulting. In real terms this, however, this is not necessarily so. Assume that Lender 1’s loan to the Borrower has gone into default. A club is formed of all the lenders in the similar position of having loans to the same borrower. In negotiations between the Borrower and the Club, it is agreed that all the loans outstanding will be rescheduled and that the loans will be rolled over so that fresh loans are made with longer maturities and these loans are used to repay the existing ones. If Lender 1 has sold his loan by using the sub-participation method, he will find that when he makes his fresh loan to the Borrower and the funds from it are used by the Borrower to repay the original loan, this process will trigger Lender 1’s obligation to repay Lender 2 on the sub-participation contract. The end result is that Lender 1 has the loan back on his books.
 
It is true that Lender 1 is not legally obliged to advance the additional funds but he is likely to be under considerable pressure to follow the outcome of negotiations and not break ranks with the other members of the Club. It is of course possible to draft an appropriate clause into the contract between Lender 1 and Lender 2 to declare that if the Borrower repays the loan in these circumstances then this will not trigger Lender 1’s obligation to repay Lender 2. The regulators, however, have recognised that risk may still attach to a sub-participated loan and have insisted that, if the appropriate protective clause has not been utilised, a proportion of it must remain on the books of Lender 1 for the purposes of capital adequacy calculations[10].
 
Not all sub-participations are funded. The transaction can be structured as a “risk sub-participation.” This involves an agreement between Lender 1 and Lender 2 that if the Borrower defaults on the loan from Lender 1, Lender 2 will pay to Lender 1 an agreed proportion of the debt. In return for this promise, Lender 1 pays Lender 2 a fee which is in effect an insurance premium for the risk being assumed by Lender 2. In this type of sub-participation, the double credit risk which is borne by Lender 2 in the funded sub-participation, now shifts to Lender 1, as he may find that the Borrower defaults and Lender 2 also fails to pay under the sub-participation agreement.
 
A risk participation is similar to a guarantee. The participant’s position is vulnerable because it has no contractual relationship with the borrower. However, if the participant has to reimburse the grantor, it will acquire rights against the borrower by way of subrogation, meaning it will be substituted for the grantor and may pursue the borrower
[1]Re Westerton, Public Trustee v Gray [1919] 2 Ch 104, Van Lynn Developments Ltd v Pelias Construction Ltd [1969] 1 QB 607.
[2] See Tolhurst v Associated Portland Cement Manufacturers (1900) Ltd [1903] AC 414.
[3]To do this, a novation must be employed; see below.
[4] E.g. in English law the requirements of a legal assignment under s136 of the Law of Property Act 1925.
[5]Stamp Act 1891.
[6] In the cases of sales of land or shares (prior to paperless transfer) it is not practicable to avoid stamping the transfer because the Land Registry or the company’s registrar will refuse to register the transfer if it is not stamped.
[7] Stamp Act 1891, s15.
[8](1828) 3 Russ 1.
[9][2002] 2 All ER (Comm) 992.
[10] See The Bank of England’s Notices BSD/1/1989/1 and BSD/1992/3.
 
Looking for the best essay writer? Click below
to have a customized paper written as per your
requirements.

The post LOAN TRANSFERS appeared first on homework handlers.