Court Affirms Separate Entity Rule in Banking Context
New York Law Journal, October 24, 2014
Court Affirms Separate Entity Rule in Banking Context
A New York bank may not be compelled to garnish the funds of a debtor that are being held in accounts of the bank’s own foreign branches, a divided Court of Appeals ruled Thursday. The court’s 5-2 determination affirmed the state’s “separate entity” rule….Among the groups filing amicus briefs were the governments of Great Britain and Northern Ireland, the Institute of International Bankers, the Securities Industry and Financial Markets Association and the New York City Bar Association’s Committee on Banking Law. The city bar committee urged the state court to affirm the separate entity rule, saying it is “so woven into the fabric of New York banking law that its endorsement by this court is essential for a prudent administration” of banking laws.
