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3/18/2020 0 Comments Economics commentary – China set to introduce new rules on smoking in public EssayChina’s economy is known as one of the strongest economies in the world, as they achieved a very high recorded rate of growth domestic product in 2010 with 10.3%, as well as china is one of the main exporters worldwide, all of these are reasons why China has a powerful role in the world economy. But unfortunately this power could be in dangerous if the economy faces market failure. Market failure occurs when there is a misallocation of resources according to the price mechanism towards the social optimal way caused by the failure of the market signal function to identify the efficient and exact outcomes (Mankiw, 2011). Which consequence externalities, In our market failure case, there is something called negative externality, which means that the third party, who are neither the consumer nor the producer, they are the society, known as the marginal social (MSb/c). This good produced is harmfully or damagingly affecting the society. Therefore there is misallocation of resources. Traditionally Government intervenes by adding to the basic price, taxes to lower the demand on the good which influences the social and private cost positively by lowering their quantities as shown in {figure A}. Concerning the article, the negative externality is present in china due to cigarettes supported by the fact that 1 out of 3 people is smoking, which is considered a negative pick rate, which surely affects the environment and the third party, as mentioned above. This fact, and the increase of cigarettes consumption, makes “The country’s authorities believe smoking kills more than one million people every year and that figure is predicted to triple by 2030â€. This statement is a very dangerous signal for china, mentioning that Chinese future is unsafe concerning both socially and economically as well, because “Smoking is a very old Chinese tradition†, which actually affects negatively the economical issues. Cigarettes are considered as demerit good. The Government has different ways to intervene and to either stop selling this kind of product or to lower its impact on the society. They can either put legislations by law to limit the quantity produced by the supplier for example for this particular good, or by banning, ban the production or consumption of a certain good that causes a negative externality, or may be by advertising to influence producers and consumers and warn. or finally by taxation, the act to put a high tax on demerit goods, which is the very known and traditional way of lowering the consumption of a good having negative externalities (Mankiw, 2011), Also the tradable permits, which could be a solution in other situations, but it may have a relation to the Chinese one, as we know the production of cigarettes is surely harming the environment so that they can use the tradable permits to minimize the supply of cigarettes. All of these are ways for the government to attempt to correct market failure by influencing both supply and demand for goods. This is exactly the situation in China, cigarettes has a negative impact generally and increasing day after day its negative effects on the society, thus the government decided to make new strict rules to lower this impact as mentioned in the article, so this directly mean that the Chinese government has decided to weather apply legislation or ban more powerfully beside their stable taxation and their advertising influence. But in the situation of china they have many limitations and variable parameters that will surely affect their decisions as that The tobacco companies have huge influence in the whole Chinese industry, which means that banning couldn’t be the correct way to solve their problem as The government operates a monopoly on tobacco sales, which brings in huge amounts of source to the government as tax receipts, also at legislation may be at the same situation of banning because some Campaigners say it is difficult to promote anti-smoking policies for the reason that china is one of the biggest suppliers and producers of cigarettes as the foreign countries franchise in china for the low labor income, (Arnold, 2007) so that puts china in a bad situation as lack of transparency which may lead to internal political problems…for example, if they legalize and allow franchisor to come, they may lose the confidence of people. For the reason that foreign companies come to china to produce their cigarettes because “The cost of a packet of cigarettes is significantly lower in China than in many western countriesâ€. The solution which may help the Chinese government to interfere and either to correct the market failure economically if happens or socially to help the society to maintain good health and social wellbeing (Arnold, 2007), is actually the taxation by increasing very high percentage of tax {figure B}, after putting in consideration all of the limitations, the use of taxation is the ideal solution. To conclude, we can say that the government has to keep the market under surveillance because the market is left totally free, surely will appear overproduction of goods having negative externalities as demerit goods, as cigarettes or goods that passes from steps in production that pollute the environment, causing circumstances as spreading different diseases and danger for all living organisms which leads socially to high death rate and economically on the long term to economical crisis. Therefore, government has to interfere, to limit the extent of demerit goods on the free market, to insure a safe future both economically and socially. Bibliography Arnold, R. A. (2007). Microeconomics. switzerland: thomas south-western. Mankiw, N. G. (2011). Principles of Economics Study Guide. New City : Cengage Learning.
1/15/2020 0 Comments Intention of Life InterestIntention of Life Interest 1. (a) The life interest of Parwinder which on the surface appears to be a vested, immediate and limited interest is coupled with a remainder interest for their daughters. In this instance, there is a problem with certainty of intention. Although technical words are not necessary,[1] problems arise when precatory words such as ‘in full confidence’ and ‘will respect’ are used in this provision. The wording of this provision is very similar to the wording of another provision featuring in Comiskey[2] which stated “in full confidence that … at her death she will devise it…†between nieces as “she might see fit.†Therefore, following this judgment it is likely that the courts would construe from her words an intention to leave her estate to her husband with a gift over of the remaining property to be shared between her daughters according to his will and otherwise equally. However, if the court decides that intention cannot be derived from this provision, Parwinder will take the property beneficially and there is a resulting trust.[3] In this instance Parwinder will be appointed trustee of the estate thus, he can be compelled to carry out the trust. Should Parwinder become unable to allocate shares to his daughters the court will operate as trustee and distribute the estate if all certainties are found to be valid. If Parwinder is held to be a trustee, he must carry out the distribution of the estate as a trust is obligatory. Therefore, he must make a provision in his will allocating the distribution of the estate or else he must create an express trust making sure he includes valid certainties and follows the beneficiary principle inter vivos. This provision may also constitute a trust in conjunction with a power of appointment. According to Hanbury Martin, when a husband gives his estate to his “widow for her life, and after her death to their children†but allows the wife to decide the shares for each child it is a valid power to “appoint using her absolute discretion with a gift in default of equal shares “[4] Therefore, a special power exists whereby Parwinder must distribute the estate to a specified group of appointees[5] however, he is under no obligation to carry out his duty or even consider it as an obligation.[6] (b) Firstly, this provision may fail for lack of certainty of subject matter in that the size of each beneficial interest is not expressly declared.[7] However, the court may determine that the settlor has provided an effective method of determining the size of the gift therefore; the court will apply its assumption in order to prevent the gift from failing.[8] Should the courts be unable to determine any certainty of size of the beneficial interest the provision will become a resulting trust for the settlor’s estate. Assuming the share size may be determined by some means, it would appear that £200,000 has been made over into a trust held by the trustees of the estate. However, the obligation to distribute the money to the first 100 applicants must be clarified as a discretionary trust or a power of appointment. According to Hanbury Martin it appears that the trustees who hold a trust for the benefit of “such members of a class of beneficiaries as the trustees shall in their absolute discretion selectâ€[9], are in fact the trustees of a discretionary trust. The first requirement would then be to ascertain if there is certainty of objects using the test encouraged by the House of Lords, the Given Postulant Test.[10] The test requires the trustees to ask “Can it be said with certainty that any given individual is or is not a member of the class?â€[11] Using this test it is valid to say that any postulant who has written in response to the advertisement in the Oxford Gazette and who have made a moral claim for a share will have to be considered a member of the class of beneficiaries. A slight problem arises if in response to the advertisement the following day 100+ letters are received making it impossible for the trustees to determine who the first 100 beneficiaries are as is clearly requested in the provision. This would result in administrative unworkability and the trust would become void and revert back to the settlor’s estate. (c) The wording of the provision would be construed to impose a fiduciary duty on the trustees and thus, produce an express trust. This is due to all certainties being very explicit and straightforward. Although Charles is in a coma and unlikely to recover, the trustees are still bound under the terms of the trust to distribute property to Charles according to the declaration of trust. Overall, the trustees are under a general duty to act even-handedly and “maintain equality between the beneficiariesâ€[12] especially in the context of successive interests. The trustees still maintain the legal title of the cars and Charles and the Oxford Motor Museum enjoy merely an equitable and beneficial interest. Therefore, it is possible for the Trustees to maintain the legal title to the cars and give the entire collection of cars to the Museum on trust as they will not automatically acquire the legal title to the cars. Should Charles die his equitable interest in one of the cars will succeed him and become part of his estate, however, if he were to recover he would still have an equitable interest in one of the cars which he could then take advantage of. Once he or a beneficiary of his estate has chosen a car the legal title of the car will be transferred to them through the appropriate procedure and the trustee’s duty to Charles will be fulfilled and the trust will end. The trustees will then hold the remaining cars on trust for the Museum. The final option available to the trustees is to make an application to the Court for Directions. As Charles is still living, he has an earnest claim on one of the vintage cars; therefore, if the trustees apply to the Court for direction and follow any subsequent directions of the court they will be protected.[13] This process has come into effect to allow difficulties in administration of the trust to be heard by the Court and alleviate the “risk of making decisions upon a false premise.â€[14] 2. One of the main problems in the current law surrounding interests in the family home is in regards to the sometimes archaic nature of the law in respect to the more level field that man and woman now work and support themselves through their careers. Pettitt vPettitt[15] made clear that a women housework, childcare and contributions towards expenses do not equate to contribution towards the purchase price therefore, unless the wife demands the house to be conveyed to the spouses jointly, she may find she has no interest in the house upon dissolution of her marriage, however, the right to invoke discretionary powers of the court to distribute the property is still an option she has upon divorce. The main problem with the current law today is the lack of statutory power a court has when dealing with cohabiting couples who share a family home. Couples may often live together for years and have children and mutually contribute to the house via renovation, expenses and upkeep, however, often times the house is registered to one of the individuals only. However, a non-legal co-owner may have an equitable interest resulting in a constructive trust even where a direct financial contribution has not been made.[16] A constructive trust is another solution to this problem whereby the courts will consider contributions made to the mortgage payment by each party, refurbishment the house as this contributed to the maintenance and essential upkeep. This remedy comes into effect if one party has “acted to his detriment†in reliance on the assurance that he held a beneficial interest.[17] Lastly, and in most cases preferable is the remedy of proprietary estoppel or when the Courts “protect the expectations of the non-owner and may award the non-owner as much as a full ownership interest in the land if justice demandsâ€[18]. The essential elements of proprietary estoppel exist where the legal owner of the property has encouraged a third party to believe that he has or will in the future obtain rights in respect of the property and the third party has acted in reliance of this assurance to his detriment.[19] This is the most just remedy available as it will consider mere oral declarations such as “the house is as much yours as mine†or “we share everything 50-50†as an assurance and the non-legal owner is likely to be granted an equitable interest in the property upon dissolution of the family home based on the amount of contribution made over the years of communal living. BIBLIOGRAPHY PEARCE, R AND STEVENS, J. (2002) The Law of Trusts and Equitable Obligations 3rd Edition London: LexisNexis Butterworth’s Tolley. PENNER, J.E. (2001) Mozley and Whitley’s Law Dictionary 12th Edition London: Butterworths. MARTIN, J.E. (2001) Hanbury Martin Modern Equity 16th Edition London: Sweet Maxwell Ltd. Footnotes [1] Paul v Constance [1977] 1 W.L.R. 527 [2] Comiskey v Bowring-Hanbury [1905] A.C. 84 [3] Watson v. Holland [1985] 1 All E.R. 290. [4] Martin (2001) page 173. [5] Re Gestetner [1953] Ch. 672. [6] Martin (2001) page 174 [7] Boyce v Boyce (1849) 16 Sim 476. [8] Re Golay [1965] 1 W.L.R. 969 [9] Martin (2001) page 175. [10] Re Gulbenkien’s Settlements [1970] AC 508 [11] Ibid per Lord Wilberforce [1971] AC 424 at pages 454-6. [12] Martin (2001) page 553. [13] Re Londonderry’s Settlement [1965] Ch. 918. [14] Martin (2001) page 550. [15] [1970] AC 777. [16] Lloyds Bank v Rossett [1991] 1 AC 107. [17] Ibid at page 536. [18] Penner (2001), page 281. [19] Gillies v Keogh [1989] 2 NZLR 327 at page 346 per Richardson J.
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