Fact Pattern 52-1B
Sociedad Guarantia , a Mexican firm, borrows $1 million from Tri-national Bank, a U.S. firm. Later, SG files for bankruptcy under Mexican law and asks the Mexican court to order the reimbursement of certain payments on the loan. Tri-national files a suit against SG in a U.S. court, arguing that the funds do not belong to SG.
-Refer to Fact Pattern 52-1B. The U.S. court in Tri-national's suit is most likely to apply the principle of comity because

Question

Fact Pattern 52-1B 
Sociedad Guarantia , a Mexican firm, borrows $1 million from Tri-national Bank, a U.S. firm. Later, SG files for bankruptcy under Mexican law and asks the Mexican court to order the reimbursement of certain payments on the loan. Tri-national files a suit against SG in a U.S. court, arguing that the funds do not belong to SG.
-Refer to Fact Pattern 52-1B. The U.S. court in Tri-national's suit is most likely to apply the principle of comity because

Quizplus · Accepted Answer

The principle of comity refers to the idea that courts of one country should show respect and deference to the actions of the courts of another country. In this case, the U.S. court is likely to apply the principle of comity because the bankruptcy proceedings in the Mexican court appear to be fundamentally fair and not in violation of U.S. public policy. By recognizing and respecting the actions of the Mexican court, the U.S. court would be fostering good relations and cooperation between the two countries. Option A is incorrect because the exemption of foreign nations from U.S. court jurisdiction only applies to certain types of activities, and borrowing money from a U.S. bank does not fall within that exemption. Option C and D are also incorrect because they do not fully capture the principle of comity and its rationale.