Question

In the KAUFFMAN-HARMON case What are some benefits of a court ruling by the letter of the law?what are some disadvantages of a court ruling by the letter of the law?

Answer 1

BENEFITS OF THE CASE RULING:

1. If court would have allowed to re-transfer the stocks back to Dr. and Mrs. Kauffman, then it would have been unjust to children as they have invested their personal time and finances because they had accepted the ownership and have relied on the ownership for past few years.

2. The honorable court did not order to re-transfer or did not hold the transfer invalid is a benefit, otherwise the stocks would have been applied retrospectively and payment foe taxes and to creditors would have done out of that. No funds would have left with children.

DISADVANTAGES OF THE CASE RULING:

1. The stock transfer was done to evade Tax Liability and to defraud creditors. After few years in the court decision, the honorable court ordered to not re-transfer the stock to Dr. and Mrs. Kauffman and the dispute shall continue among children. This should not become the habit in business to transfer stocks and evade liability.

2. The honorable court did not ordered to pay the Tax liability that was evaded by Kauffman.

3. The dispute among children for ownership of stock should not have been continued, it should have been settled by the court by partition.