Gale Encyclopedia Of American Law 3Rd Edition Volume 10 P22 pptx

suppose a person buys a car from a dealer in a nearby state that does not impose a sales tax. The buyer must pay use tax on the purchase price when he returns to his state or city. In addition, persons who order catalog merchandise from out-of-state companies that do not charge sales tax are obligated to pay the use tax themselves. Collecting the tax in this situation is difficult, however, because the government has no effective way of monitoring these sales. Theother purpose ofausetax isto helprecoup thecost ofpublic services directlyrelatedto the use of certain types of personal property. The most common use taxes are assessed on motor vehicle and boat licenses. User fees are also charged for docking privileges in airports or harbors. The use tax on motor vehicles is generally allocated to the maintenance of roads and bridges and to the regulation and administra- tion of motor vehicles. The federal government collected a use tax on motor vehicles during WORLD WAR II, but the tax was shifted to the states after the war. The use tax on vehicles and boats also serves as a method for identifying all vehicles and boats in the jurisdiction. USUFRUCT A CIVIL LAW term referring to the right of one individual to use and enjoy the property of another, provided its substance is neither impaired nor altered. For example, a usufructuary right would be the right to use water from a stream in order to generate electrical power. Such a right is distinguishable from a claim of legal ownership of the water itself. USURPATION The illegal encroachment or assumption of the use of authority, power, or property properly belong- ing to another; the interruption or disturbance of an individual in his or her right or possession. The term usurpation is also used in reference to the unlawful assumption or seizure of sovereign power, in derogation of the constitu- tion and rights of the proper ruler. When a state legislature acts to regulate an area over which Congress has exclusiv e or “plenary” authority under the Constitution, it is said to usurp a federal power that is not its own. In 1995, a federal district judge struck down significant portions of California’s Proposition 187, an initiative that denied illegal ALIENS various social and educational benefits, and found that the legislation had unconstitutionally usurped a federal power to regulate IMMIGRATION. LEAGUE OF UNITED LATIN AMERICAN CITIZENS v. Wilson, 908 F. Supp. 755 (C.D. Cal. 1995). USURY The crime of charging higher interest on a loan than the law permits. State laws set the maximum amount of interest that can be charged for a loan of money. A lender that charges higher than the maximum amount of interest is guilty of the crime of usury. In addition, courts may modify contracts that contain usurious rates of interest by reducing the interest to the legal maximum. The charging of excessive interest in ex- change for a monetary loan has been considered reprehensible from the earliest times. Chinese and Hindu law prohibited it, while the Athe- nians scorned persons who charged more than a moderate rate of interest for a loan. The Romans at one time abolished the practice of charging interest. Although they later revived it, the rates were strictly regulated. During the Middle Ages in weste rn Europe, the Catholic Church censured usurers, and when they died, the Crown confiscated their lands and property. Until the thirteenth cen- tury, charging any interest was defined as usury in England. As commerce and trade increased, however, the demand for credit grew, and usury was redefined to mean exorbitant interest rates. In 1545 the English Parliament set a legal maximum interest rate. Charging interest higher than the maximum constituted usu ry. The United States followed the English practice as states passed laws that set maximum legal interestrates. Rate restrictions vary from state to state, and different limits are set for different kinds of loans. For example, higher interest rates are usually allowed on consumer loans than on home mortgages. Some states do not restrict the interest rates that corporations can be charged under the assumption that corporations have sufficient bargaining power and business sense to negotiate a fair rate independently. Restrictions on legal interest rates apply to banks, consumer loan companies, and other businesses that extend credit. Loan agreements between private individuals are also governed by state usury laws. For example, if a person agrees GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 198 USUFRUCT Rent-to-Own Contracts: Should They Be Subject to Usury Laws? F or more than 30 years, the legal status of rent-to-own (RTO) contracts has been the subject of debate. Consumer advocates decry the high cost of these contracts, which typically involve furni- ture, appliances, televisions, and other electronic goods. The RTO industry argues that it has been unfairly accused of consumer exploitation, when in fact it provides a needed service to individuals who either have poor credit or prefer to rent certain consumer goods. In most states RTO businesses must follow disclo- sure requirements when making RTO contracts, yet these businesses are allowed to charge rates that, if characterized as credit, would violate state usury laws. The RTO industry, which serves close to 3 million customers per year and generates almost $4 billion in revenues annually, is composed of dealers who rent consumer goods with an option to buy. An RTO contract normally allows a customer to rent something for one week or one month at a time. At the end of the week or month, the customer can either terminate the agreement without any cost or obliga- tion or renew the contract by making another advance rental payment. If the contractis reneweda prescribednumber of times—typically, a period of 18 months— and the customer meets the terms of the rental agreement, the store conveys own- ership of the item to the customer. Critics of RTO contracts contend that the cost of an 18-month contract greatly exceeds the value of the item purchased. If the contract was considered a credit sale rather than a lease, it would violate state usury laws. Usury laws are designed to prohibit excessive finance charges and to preventcreditorsfrom gougingconsumers, who are typically in a weaker bargaining position. Consumer advocates contend that RTO customers are mostly poor and uneducated and have poor credit histories. These customers spend a larger percentage of their disposable income on RTO con- tracts than more affluent consumers do using traditional credit arrangements. Consequently, these critics believe states should reclassify RTO contracts as install- ment sales rather than as leases. Consumer advocates note that if RTO contracts were recognized as credit sales, the federal Consumer Credit Protection Act, alsoknownasthe TruthinLendingAct (15 U.S.C.A. § 1601 et seq. [1968]), would apply. The act requires strict disclosures in consumer credit sales, as do state retail installment sales (RIS) laws. An RTO dealer would have to disclose the contract price of the consumer good, the total RTO price, the associated finance charges, and the applicable interest rate. In theory, such disclosures would allow a consumer to shop around for the best RTO deal. More than 40 states have adopted some type of RTO legislation. For example, Minnesota’s Rental Purchase Agreement Act (RPAA) (Minn. Stat. § 325F.84 et seq. [1990]), provides a number of protections to consumers. It requires specific disclo- sures in the RTO contract, in advertising, and on in-store merchandise tags. The RPAA also provides restrictions and pro- tections in the event of the customer’s default, gives the consumer reinstatement rights, and limits delivery charges, security deposits, and collection fees. The RTO industry rejects the idea that consumers are subjected to usurious inter- est rates when they enter into a contract. The industry says that an overwhelming majority of customers do not pursue the ownership option. Dealers point out that 75 percent of customers return the rented item within the first four months and that fewer than 25 percent rent long enough to own the item. RTO supporters also challenge the stereotype of the typical RTO customer. A 1994 survey, sponsored by the Associa- tion of Progressive Rental Organizations (APRO), a national industry group, found that almost 60 percent of RTO customers earned between $24,000 and $75,000 annually. In addition, a 1996 APRO survey found that 45 percent of RTO customers had a high school education and almost 30 percent had some college education. The industry’s customer base includes students, business executives ontemporary assignment, military personnel, and fami- lies in transit. The RTO business contends that it provides products to consumers who have immediate needs for consumer householdgoods but w hoeitherdo n otwant or cannot accept long-term obligations, as well as to cust omers who do not have access to traditional c redit a rrangements. The RTO industry challengestheclaim that it wishes to keep customers in the dark about the cost of RTO contracts. The industry, which sees potential for contin- ued growth, is taking steps to protect customers and ensure that RTO dealers are ethical. The APRO notes that it has participated in the debate and drafting of RTO disclosure laws in forty-four states. The industry agrees that contracts should disclose basic information, including the cash price of the product, the amount of each rental payment, the number of payments necessary to acquire ownership, and the total cost of the product acquired. The RTO industry believes that once this information is disclosed, customers should have the freedom to make an RTO contract. The industry does not agree that state usury laws should be applied to RTO agreements. RTO operators note that no one is compelled to enter into an agreement. In addition, the costs of doing business in the RTO market dictate the rental rates charged to customers. RTO businesses must provide full service, including repairs, loaners, and pickup and delivery. Finally, RTO dealers do not agree that an RTO agreement is a credit sales agreement. Instead, they see it as a no-obligation, no-debt agreement that gives the customer the option of ending the agreement at the end of the rental cycle. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION USURY 199 to lend a friend $5,000, the interest rate cannot exceed the maximum set by the state usury statute. Persons who charge excess interest and then threaten EXTORTION are known a s loan sharks. They may be prosecuted for usury and, if convicted, fined and possibly imprisoned. The persons who typically borrow from a LOAN SHARK are those who cannot qualify for a loan from a commercial lender. ORGANIZED CRIME has traditionally relied on loan sharking as a source of income. The penalty for usury is ordinarily a fine, FORFEITURE of the interest, or both. In some cases involving CONSUMER CREDIT, courts may modify usurious contracts and allow the borrower to pay only the principal sum and legal interest. Courts have often concluded, for example, that the high interest rates charged by “rent-to-own” businesses for the rental of consumer goods, such as furniture and televisions, are usurious and force the consumer to pay an exorbitant price for the goods. The UNIFORM CONSUMER CREDIT CODE (UCCC) was drafted to address many of these consumer credit problems. Though only nine states have adopted the code in its entirety, most states have included selected provisions from it in their consumer credit laws. The UCCC is designed to provide protection to consumers who buy goods and services on credit. It attempts to simplify, clarify, and update legis- lation governing consumer credit and usury. The UCCC also sets interest rate ceilings to ensure that consumers are not overcharged for credit. The UCCC works in concert with the federal CONSUMER CREDIT PROTECTION ACT of 1968 (16 U.S.C.A. § 1601 et seq.), which mandates that consumers purchasing on credit be provided with full disclosure on the cost of the loan. FURTHER READINGS Association of Progressive Rental Organizations (APRO) site. Available online at http://www.rtohq.org/ (accessed June 6, 2009). Letsou, Peter V. 1995. “The Political Economy of Consumer Credit Regulation.” Emory Law Journal 44. Pimentel, Eligio. 1995. “Renting-to-Own: Exploitation or Market Efficiency?” Law and Inequality Journal 13. CROSS REFERENCE Consumer Protection. UTI POSSIDETIS A term (Latin for “as you possess”) used in INTERNATIONAL LAW to indicate that the parties to a particular treaty are to retain possession of that which they forcibly seized during a war. The principle has been adapted, as uti possidetis juris, to apply to newly independent states, thereby allowing these new states to retain pre-independence boundaries. A treaty ending a war may adopt the principle of uti possidetis, the principle of status quo ante bellum (Latin for “the state of things before the war”), or a combination of the two. UTILITARIANISM JURISPRUDENCE is a philosophy whose adherents believe that law must be made to conform to its most socially useful purpose. Although utilitarians differ as to the meaning of the word useful, most agree that a law’s utility may be defined as its ability to increase happiness, wealth, or justice. Conversely, some utilitarians measure a law’s usefulness by its ability to decrease unhappiness, poverty, or injustice. The utilitarianism movement originated in Great Britain during the eighteenth and nine- teenth centuries when philosophers JEREMY BEN- THAM , JOHN AUSTIN, JOHN STUART MILL, and Henry Sidgwick began criticizing various aspects of the COMMON LAW. Bentham, the progenitor of the movement, criticized the law for being written in dense and unintelligible prose. He sought to simpli fy legal verbiage by reducing law to what he thought were its most basic elements—pain and pleasure. Bentham believed that all human behavior is motivated by a desire to maximize pleasure and avoid pain. Yet he observed that law is often written in vague terms of rights and obligations. For example, a law might say that a person has a right to take action under one set of circumstances but an obligation to refrain from action under different circumstances. Bentham thought that law could be simplified by translat- ing the language of rights and obligations into a pain-pleasure calculation. Utilitarians have tried to apply Bentham’s hedonistic calculus to CRIMINAL LAW. They assert that punishment is a form of government- imposed pain. At the same time, utili tarians believe criminals break the law only because they do not fully comprehend the confusing language of rights and obligations. Utilitarians conclude that law must be stripped of such confusing terms and redrafted in language that equates socially undesirable conduct with pain and socially desirable conduct with pleas ure. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 200 UTI POSSIDETIS Jurist OLIVER WENDALL HOLMES was a noted utilitarian. Writing about criminal law in his book, The Common Law, Holmes wrote, “It is no doubt true that there are many cases in which the criminal could not have known that he was breaking the law, but justice to the individual is rightly out-weighed by the larger interests on the other side of the scales.” Utilitarians measure the desirability of human conduct by the amount of happiness it generates in society. They maintain that the ultimate aim of any law should be to promote the greatest happiness for the greatest number of people. Utilitarians would permit conduct that produces more happiness in society than unhappiness and would proscribe conduct that results in more unhappiness than happiness. Some utilitarians envision a democratic society where the happiness and unhappiness produced by a particular measure would be determined precisely by giving everyone the right to vote on the issue. Thus, those in power would know exactly how the citizenry felt about every issue. Although the application of utilitarian prin- ciples may strengthen majority rule, unfettered democracy can lead to tyranny. Utilitarians are frequently criticized for sacrificing the interests of minorities to achieve majoritarian satisfaction. In a pure utilitarian form of government, a voting majority could pass laws to enslave min- ority groups as long as the institution of SLAVERY continued to satisfy a preponderance of the population. Concepts such as EQUAL PROTECTION, human dignity, and individual liberty would be recognized only to the extent that a majority of the population valued them. Modern utilitarians have attempted to soften the harshness of their philosophy by expanding the definition of social utility. Law and econom- ics is a school of modern utilitarianism that has achieved prominence in legal circles. Proponents of law and economics believe that all law should be based on a cost-benefit analysis in which judges and lawmakers seek to maximize societal wealth in the most efficient fashion. The term wealth possesses both pecuniary and nonpecuni- ary qualities. The nonpecuniary qualities of wealth may include the right to self-determina- tion and other fundamental freedoms that society deems important, including FREEDOM OF SPEECH and religion. Under such an analysis, institutions like slavery that deny basic individual liberties would be declared illegal because they decrease society’s overall nonpecuniary wealth. Economic analysis of law has more practical applications as well. RICHARD A. POSNER, chief judge for the Seventh Circuit Court of Appeals from 1993 to 2000, is a pioneer in the law and economics movement. He advocates applying economic analysis of law to most legal disputes. For example, in NEGLIGENCE actions Posner believes that liability should be imposed only after a court weighs three factors: the pecuniary injury suffered by the plaintiff, the cost to the defendant in taking precautions aga inst injuri- ous behavior, and the probability that a particular injury co uld have been avoided by the defendant. This cost-benefit analysis is widely accepted and is appli ed in negligence actions by both state and federal courts. Thus, through economic analysis of law, utilitarianism and its permutations continue to influence legal thinking in the United States. FURTHER READINGS Bentham, Jeremy. 1990. A Fragment on Government. Edited by H.L.A. Hart and J.H. Burns. Cambridge: Univ. of Cambridge Press. Binder, Guyora, and Nicholas J. Smith. 2000. “Framed: Utilitarianism and Punishment of the Innocent.” Rutgers Law Journal 32 (fall). Holmes, Oliver Wendall. 1881. The Common Law. Boston: Little, Brown & Co. Honderich, Ted, ed. 1995. Oxford Companion to Philosophy. Oxford: Univ. of Oxford Press. Mintoff, Joe. 2003. “Can Utilitarianism Justify Legal Rights with Moral Force?” Univ. of Pennsylvania Law Review 151 (January). Posner, Richard A. 2003. Economic Analysis of Law. 6th ed. New York: Aspen Publishers. CROSS REFERENCES Chicago School; Dworkin, Ronald Myles. UTTER To publish or offer; to send into circulation. The term utter is frequently used in reference to COMMERCIAL PAPER. To utter and publish an instrument is to declare, either directly or indirectly through w ords or action, that it is good. It constitutes a crime, for example, to utter a forged check. UXOR [Latin, Wife.] A woman who is legally married. The term et uxor (Latin for “and his wife”), frequently abbreviated to et ux., is used in indexing conveyances of real property, particu- larly in cases where a HUSBAND AND WIFE are joint grantors or grantees. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION UXOR 201 VACATE To annul, set aside, or render void; to surrender possession or occupancy. The term vacate has two common usages in the law. With respect to real property, to vacate the premises means to give up possessio n of the property and leave the area totally devoid of contents. To vacate a court order or judgment means to cancel it or render it null and void. A person may vacate property voluntarily or involuntarily through the issuance of an evic- tion order by a court. Rental and lease agreements usually contain a provision con- cerning when and how the tenant is to vacate the premises at the end of the lease period . Many landlords require renters to make damage deposits, which are refunded after the tenant vacates the property if the landlord deter- mines that no serious damage has been done and that the renter has not left behind PERSONAL PROPERTY that must be disposed of by the landlord. Otherwise, the landlord may keep all or a portion of the deposit. The other common legal usage of vacate refers to the canceling or rescinding of court judgments and orders. State and federal rules of CIVIL PROCEDURE give courts the authority to modify prior judgments. A judgment is the definitive act in a lawsuit that puts an end to the litigation by specifically granting or denying the relief requested by the parties. Once a judgment granting relief has been entered, the plaintiff may legally collect the damages awarded by the court. A motion to vacate a judgment must be based on a substantial issue. Rule 60(b) of the Federal Rules of Civil Procedure permits a federal court to relieve a party from an adverse judgment on various grounds including FRAUD, mistake, newly discovered evidence, and satis- faction of the judgment. Another common ground for seeking a motion to vacate is the failure to provide the person against whom the judgment is entered with sufficient notice of the action. If, for example, the plaintiff claims that after making a GOOD FAITH effort, he cannot locate the defendant to serve notice of the pending action, the court may permit service by publication in a newspa- per. On the day of the hearing, if the defendant does not appear, the court may enter a default judgment in favor of the plaintiff. However, if the defendant discovers the judgment has been filed, she can make a motion to vacate. The defendant might argue that the plaintiff could have easily served the papers personally and given the defendant the opportunity to appear in court and argue the merits of the case. Courts are generally reluctant to grant a motion to vacate a judgment, especially on the ground of newly discovered evidence. A court will not grant a motion to vacate where the complaining litigant failed to exercise due diligence in securing the evidence in sufficient time to offer it in the original lawsuit. Some V 203 jurisdictions do not allow any judgments to be vacated due to newly discovered evidence. CROSS REFERENCE Landlord and Tenant. VAGRANCY The condition of an individual who is idle, has no visible means of support, and trave ls from place to place without working. At COMMON LAW the term vagrant referred to a person who was idle, refused to work although capable of doing so, and lived on the charity of others. Until the 1970s state vagrancy statutes were used by police to charge persons who were suspected of criminal activity, but whose actions had not gone far enough to constitute a criminal attempt. Court decisions, however, have struck down vagrancy laws as unconstitu- tionally vague. In addition, the term vagrant has been replaced by HOMELESS PERSON as a way of describing a person who is without means or a permanent home. Traditionally, communities tended to regard vagrants with suspicion and view them either as beggars or as persons likely to commit crimes. In England vagrants were whipped, branded, conscripted into military service, or exiled to penal colonies. In colonial America vagrancy statutes were common. A person who wandered into a town and did not find work was told to leave the community or face criminal prosecution. After the U.S. CIVIL WAR , the defeated Southern states enacted Black Codes, sets of laws that sought to maintain white control over the newly freed African American slaves. The concern that African Americans would leave their communities and deplete the labor supply led to the inclusion of vagrancy laws in these codes. Unemployed Af rican Americans who had no perman ent residence could be arrested and fined. Typically, the person could not pay the fine and was therefore either sent for a term of labor with the county or hired out to a private employer. The abuse of vagrancy laws by the police throughout the United States was common. Such laws were vague and undefined, allowing police to arrest persons merely on the suspicion they were about to do something illegal. In 1972 the U.S. Supreme Court addressed this problem in Papachristou v. Jacksonville, 405 U.S. 156, 92 S. Ct. 839, 31 L. Ed. 2d 110. The Court ruled that a Florida vagrancy statute was unconstitu- tional because it was too vague to be under- stood. The Court emphasized that members of the pu blic cannot avoid engaging in criminal conduct, if prior to engaging in it, they cannot determine that the conduct is forbidden by law. The Court also concluded that the vagrancy law’s vagueness lent itself to ARBITRARY enforce- ment: police, prosecutors, and juries could enforce the law more stringently against one person than against another, even though the two individuals’ conduct was similar. After Papachristou the validity of vagrancy statutes was put in doubt. Prosecutions for vagrancy must now be tied to observable acts, such as public be gging. Prosecutions are rare, however, because local governments do not want to spend their financial resources incar- cerating persons for such offenses. CROSS REFERENCES Homeless Person; Void for Vagueness Doctrine. VAGUE Imprecise; uncertain; indefinite. The term vague is frequently used in reference to a statute written in language that is so indefinite or lacking in precision that an individual of ordinary intelligence is forced to guess at its meaning. Statutes that are vague are ordinarily void on that ground. CROSS REFERENCES Void for Vagueness Doctrine. Most vagrancy laws have been struck down as unconstitutionally vague, and the term vagrant has been replaced by the term homeless person. AP IMAGES GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION 204 VAGRANCY VALID Binding; possessing legal force or strength; legally sufficient. A valid contract, for example, is one that has been executed in compliance with all the requisite legal formalities and is binding upon, and enforceable by, the individuals who executed it. VALUABLE CONSIDERATION In the formation of a valid and binding contract, something of worth or value that is either a detriment incurred by the person making the promise or a benefit received by the other person. In contract law consideration is required as an inducement to enter into a contract that is enforceable in the courts. It is an essential element for the formation of a contract. What constitutes sufficient consideration, however, has been the subject of continuing legal debate. Contracts and courts generally use the term valuable consideration to signify consideration sufficient to sustain an enforceable agreement. In general, consideration consists of a prom- ise to perform a desired act or a promise to refrain from doing an act that one is legally entitled to do. Thus, a person who seeks to enforce a promise must have paid or obligated herself to pay money, delivered goods, expended time and labor, or forgone some other profitable activity or legal right. For example, in a contract for the sale of goods the money paid is the valuable consideration for the vendor, and the property sold is the consideration for the purchaser. In early COMMON LAW nominal consideration was sufficient to establish a contract. The consideration could be as small as a peppercorn or a cent as long as it demonstrated that the parties intend ed to enter into an agreement. Eventually, the courts developed the require- ment of valuable consideration, but what constitutes it has varied over time. Valuable consideration does not necessarily have to be equal in value to what is received, and it need not be translatable into dollars and cents. It is sufficient for the consideration to consist of a performance or a prom ise to perform that the promisor (the person making the promise) regards as having value. It is not essential that the person to whom the consideration moves should be benefited, provided the person from whom it moves is, in a legal sense, injured. The injury can consist of refusing to sue on a disputed claim or to exercise a legal right. The alteration in position is regarded as a detriment that forms consideration independent of the actual value of the right relinquished. VALUATION The process of determining the value or worth of an asset. There are several methods professionals use to perform a valuation, often including both objective and subjective criteria. Valuation is often used as a synonym for appraisal. VALUE The estimated or appraised worth of any object or property, calculated in money. The word value has many meanings and may be used in different senses. Because value is usually a relativ e term, its true meaning must be determined by the context in which it appears. Value sometimes expres ses the inherent usefulness of an object and sometimes the power of purchasing other goods with it. The first is called value in use, the latter value in exchange. Value in use is the utility of an object in satisfying, directly or indirectly, the needs or desires of human beings. Value in exchange is the amount of commodities, commonly repre- sented by money, for which a thing can be exchanged in an open market. This concept is usually referred to as market value. Courts have frequently used the word value without any clear indication of whether it referred to value in use or market value. Generally, however, the courts and parties in civil actions are concerned with market value. Though courts may refer to salable value, actual value, fair value, reasonable value, and cash value, these terms are synonymous with market value. Value is also employed in various phrases in business and commercial usage. The phrase actual cash value is used in insurance to signify the cost of purchasing new replacement property less normal depreciation, though it may also be determined by the current market value of similar property or by the cost of replacing or repairing the property. Cash surrender value is used in life insurance to refer to the amount that the insurer will pay the policyholder if the policy is canceled before the death of the insured. Book value is the value at which the assets of a business are carried on the company’s books. The book value of a fixed asset is arrived at by GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION VALUE 205 subtracting accumulated depreciation from the cost of the asset. Book value may also refer to the net worth of a business, which is calculated by subtracting liabilities from assets. Liquidation value is the value of a business or an asset when it is sold other than in the ordinary course of business, as in the liquidation of a business. In the STOCK MARKET, par value is the nominal value of stock; it is calculated by dividing the total stated capital stock by the number of shares authorized. Stated value is the value of no par stock established by the corporation as constitut- ing the capital of the corporation. CROSS REFERENCES Fair Market Value. v VAN BUREN, MARTIN Prominent political leader, U.S. senator, SECRE- TARY OF STATE , vice president, and eighth president of the United States, Martin Van Buren led the nation during its first major economic crisis. The New York native built a career based on machine politics—the control of local political power by a well-disciplined organization. Van Buren held top positions in his home state before entering national politics, where his instinct for party building helped create the DEMOCRATIC PARTY in the 1820s. Elected vice president in 1832 and president in 1836, he sought to protect federal monetary reserves during the depression that began shortly after he took office. Born in Kinderhook, New York, on Decem- ber 5, 1782, Van Buren was the third of five children born to Dutch working-class parents. He began to study law at the early age of fourteen and gained admission to the New York bar four years later in 1803. He was elected to the New York legislature in 1812 and continued to be reelected until 1820. From 1816 until 1819 he also served as the state attorney general. Van Buren’s political views came directly from Jeffersonian Republicanism. Like THOMAS JEFFERSON , he believed in STATES’ RIGHTS and opposed a strong federal government. During the early years of his career in New York, Van Buren controlled the so-called Albany Regency, a political machine that was very influential in state politics. Later, in the 1820s, he joined forces with ANDREW JACKSON and helped to forge the political alliances that would lead to the formation of the Democratic Party. As in state politics, Van Buren enjoyed steady success at the national level. He won election to the U.S. Senate in 1821 and retained Martin Van Buren. LIBRARY OF CONGRESS ▼▼ ▼▼ Martin Van Buren 1782–1862 17751775 18251825 18501850 18751875 18001800 ❖ 1775–83 American Revolution 1782 Born, Kinderhook, N.Y. 1812–14 War of 1812 1803 Admitted to New York bar 1816–19 Served as New York attorney general 1812–20 Served in New York state legislature 1828 Elected governor of New York 1829 Appointed secretary of state by President Jackson 1821 Elected to U.S. Senate 1833–36 Served as U.S. vice president 1837 U.S. economic depression began 1844 Failed to gain Democratic presidential nomination 1837–40 Served as U.S. president 1846–48 Mexican War 1862 Died, Kinderhook, N.Y. 1861–65 U.S. Civil War ◆◆◆◆◆◆❖ LET THEM WORRY AND FRET AND INTRIQUE AT WASHINGTON.SIX WEEKS HENCE THEY WILL FIND THEMSELVES AS WISE AS THEY WERE WHEN THEY BEGAN . —MARTIN VAN BUREN GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 206 VAN BUREN, MARTIN his senatorial seat until 1828 when he became governor of New York. He resigned the office a mere twelve weeks later, howev er, to become secretary of state under President Jackson. His support of Jackson through the president’s turbulent first administration paid off: in 1832 Jackson chose Van Buren as his vice presidential running mate over the incumbent JOHN C. CALHOUN, and the two were elected. Van Buren’s own election as president in 1836 was precipitated by crisis. Under the Jackson administration, land speculation had run rampant nationwide. When Congress failed to interven e, banks issued great numbers of loans without backing them up with security. The speculation continued until Jackson or- dered the government to accept only gold or silver as payment on land. The result was the so- called Panic of 1837, a devastating financial crash that led to the first large-scale economic depression in U.S. history. By 1840 Van Buren had convinced Congress to pass the Indepen- dent Treasury Bill. It provided for federally controlled vaults to store all federal monies; transactions were to be conducted in hard currency. The independent treasury protected federal deposits until 1841, when it was abolished. President JAMES K. POLK brought it back in 1846. In August 1837 Van Buren denied Texas’ formal request to join the United States. Historians have said that Van Buren gave a higher priority to sectional harmony than to territorial expansion. In 1838 he oversaw the “Trail of Tears,” the name given to the expulsion of the Cherokee tribe from Georgia, Tennessee, Alabama, and South Carolina to the Oklahoma territory–an event that proved to be a very unfortunate legacy in both national history and the Van Buren presidency. Van Buren sought reelection in 1840, running as the only presiden tial candidate without a vice presidential candidate in history. Defeated by WILLIAM HENRY HARRISON,he attempted to gain the Democratic nomination again in 1844 but was unsuccessful. His popularity had deteriorated both because of the depression and because of his positions on other domestic issues. He opposed the ANNEX- ATION of Texas, which he feared would precipi- tate a war with Mexico, and an expens ive war against Seminole Indians in Florida. He tried once more to win the Democratic presidential nomination in 1848 but was defeated again. He died on July 24, 1862, in Kinderhook, New York. FURTHER READINGS Leonard, Gerald. 2001. “Party as a 'Political Safeguard of Federalism': Martin Van Buren and the Constitutional Theory of Party Politics. Rutgers Law Review 54 (fall). Mushkat, Jerome, and Joseph G. Rayback. 1997. Martin Van Buren: Law, Politics, and the Shaping of Republican Ideology. DeKalb: Northern Illinois Univ. Press. Silbey, Joel H. 2002. Martin Van Buren and the Emergence of American Popular Politics. Lanham, Md.: Rowman & Littlefield. v VAN DEVANTER, WILLIS As an associate justice of the U.S. Supreme Court from 1910 to 1937, Willis Van Devanter was considered the leading conservative justice of the era. Van Devanter’s background in education, politics, and the law brought him to the bench, first as chief justice of the Wyoming Supreme Court and then as a U.S. circuit judge. In his 26 years on the U.S. Supreme Court, he consistently oppose d the expansion of government power. His opposi- tion was fiercest during the administration of President FRANKLIN D. ROOSEVELT, when he joined three other conservative justices of the Supreme Court in fighting Roosevelt’s legislative pro- gram, the NEW DEAL. Their like-minded opi- nions, which earne d them the nickname the “Four Horsemen,” led to a sharp confrontation with the president. Born on April 17, 1859, in Marion, Indiana, Van Devanter was the first of eight children born to Violetta Spencer and Isaac Van Devanter, a lawyer and abolitionist. He excelled in academics, graduating in 1878 from Indiana Asbury University (now DePauw University) with a near perfect record in history, math, Greek, and Latin. In 1881 he earned a bachelor of laws degree from the Cincinnati Law School and established a law practice in Indiana. He soon moved to Wyoming where he represented railroads, helped to amend the state’s statutes in 1886, and served as city attorney for two years. In 1888 he was a representative at the territorial legislature and chaired the Judiciary Committee. Van Devanter also found time for hunting grizzly bears with the legendary Buffalo Bill (William F. Cody). For the next two decades, Van Devanter’s energies w ere divided among the judiciary, education, and REPUBLICAN PARTY politics. He WE ARE OF THE OPINION THAT THE POWER OF INQUIRY — WITH PROCESS TO ENFORCE IT —IS AN ESSENTIAL AND APPROPRIATE AUXILIARY TO THE LEGISLATIVE FUNCTION . —WILLIS VAN DEVANTER GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION VAN DEVANTER, WILLIS 207 . governed by state usury laws. For example, if a person agrees GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 198 USUFRUCT Rent-to-Own Contracts: Should They Be Subject to Usury Laws? F or more than. no-debt agreement that gives the customer the option of ending the agreement at the end of the rental cycle. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION USURY 199 to lend a friend $5,000, the. death of the insured. Book value is the value at which the assets of a business are carried on the company’s books. The book value of a fixed asset is arrived at by GALE ENCYCLOPEDIA OF AMERICAN LAW,