Motorola Credit Corp. v Standard Chartered Bank

At issue in this case was whether the “separate entity” rule continues to be valid law and serves to prevent a judgment creditor from ordering a garnishee bank operating branches in New York to restrain a judgment debtor’s assets held in foreign branches of the bank. The United States Court of Appeals for the Second Circuit certified this question of law to the New York Court of Appeals. Plaintiff, the judgment creditor in this case, asked the Court of Appeals to disavow the separate entity doctrine as outmoded and unnecessary. Defendant, the garnishee bank, urged that the rule remains vital in the context of international banking. The Court of Appeals answered the certified question in the affirmative, holding that the separate entity remains valid, and thus, a judgment creditor’s service of a restraining notice on a garnishee bank’s New York branch is ineffective under the separate entity rule to freeze assets held in the bank’s foreign branches. View "Motorola Credit Corp. v Standard Chartered Bank" on Justia Law