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In a New York Nanosecond

Looking up at Manhattan Skyscrapers

New technology can have unforseen effects. The Law in particular can sometimes struggle to keep up, but for the IT savvy lawyer that can mean opportunity. One bunch of lawyers realised that the way money now moves round the world electronically could give their clients the edge, for example. Nanoseconds are all it takes. As a result a bunch of New York nanoseconds are giving Judges in the Southern district court of the city a real headache, though.

Different countries have different laws. That means lawyers will go out of their way to apply the law for their clients in the right country. It can make all the difference. Unlike some other countries US maritime law, for example, allows a person to freeze a person's assets, even before a decision has been reached, when there is a maritime claim against them. For example if a merchant hasn't been paid for a shipload of cargo, or if a shipyard hasn't been paid for ship repairs, then they can use this rule to freeze the defaulter's money. Otherwise a win, when it comes, could be rather hollow, with the money long placed out of reach. The only trouble for the lawyers is that the money has to be in the US for the US law to apply.

Frozen money

That is where the technology comes in. Bankers don't ship physical money from country to country, it's all done electronically now... A consequence of the way the banking system is set up is that dollar transactions have to pass through the US banking centre in Manhattan as the money has to move from place to place. That's an easy thing to require in the age of the Internet. It only spends a fraction of a second in New York before it jumps on somewhere else. The law, of course, makes no distinction over shrinking timescales in which computers make things happen, though. A prepared lawyer can have the money frozen in that instant.

That is great for people wanting to hold up money. It is a nightmare for the New York judges, though. Now that the lawyers have caught on about those nanoseconds the work is stacking up. All those fractions of a second add up to hours of the Judges' time granting permission for the money to be seized. Every day the poor New York judges have to process hundreds and hundreds of requests, just in case some disputed money happens to pass through. To seize the money, it isn't enough just to put in a request and wait, ready to pounce when the money lands in Manhattan. Instead, just like a Spider respinning its web every morning, the trap has to be renewed daily. To do that the lawyers have to serve the bank daily with notice that if any money passes through that day it must be stopped in its high speed tracks.

The rules will no doubt change. Whether this is better for everyone, or just for the judges is of course a moot point. New technology constantly brings up new problems like this, when old laws are found to be wanting as the way things are done changes far beyond the imagination of those who drafted it. Just as technology never stands still, neither does the law...or the IT savvy lawyers.

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