Legal Environment of Business Notes

CHAPTER 1: INTRODUCTION TO LAW AND LEGAL REASONING

I. SCHOOLS OF JURISPRUDENTIAL THOUGH

a. Types of Schools of Jurisprudential Schools.

1. The Natural Law School A. Denotes a system of moral and ethical principles based on a person’s natural instinct and use of natural intelligence. i. Dates back to Greek Philosopher Aristotle (384-322 B.C.) distinguished between natural law and laws governing a nation. 2. The Positivist School A. Positive Law-National and written law i. POSITIVISTS believe there is no higher law than written laws. Natural laws are instead called human rights. 3. The Historical School A. Evolutionary process of law by concentrating on the origin an history of the legal system. i. Legal doctrines that have been established through time and history that shape law today 4. Legal Realism A. Based on the idea that law is just one of many institutions in society and law is shaped by social forces and needs. i. 1920 and 1930’ scholars and jurists rebelled against historical school jurisprudential thought. ii. Realists do not believe law can be evenly applied due to Judges being human with diverse law philosophies and personalities. B. Sociological school is strongly influenced by realism. This tool is used to promote justice in society such as civil rights movements.

II. Business Activities and the Legal Environment

1. Laws may affect single business transactions A. Laws affect businesses in hiring, firiring, safety, manufacturing, marketing, bus. Finance and more. i. Breach-To break, fail, dishonor performance in a contract ii. Laws will affect “payment under contract”, insufficient funds, disputes, management power, etc. 2. Ethics and Bus. Decision Making A. Decision makers must decide between good business decision and what is ethical. i. Ethics-the study of what constitutes right or wrong behavior. III. Sources of American Law A. US Constitution and State Constitutions B. Statutory Law-Local State government laws as well as laws by Congress and state legislation C. Regulations created by administrative agencies, such as the FDA, EPA, etc. D. Case law and common laws 1. Constitutional Law A. General organization, powers, and limits of their respective government. i. Article VI—the Constitution I sthe supreme law of the land. ii. Laws in violation of the constitution will be declared unenforced and unconstitutional iii. 10th Amendment reservesto the states all powers not granted to the federal government. iv. State Law is supreme within all borders as long as it does not violate the constitution. 2. Statutory Law A. Laws enacted by legislative bodies an any level of government: congress, state, . i. Ordinances—Statutory laws include ordinances (city level such as zoning, safety codes, building codes) ii. Uniform Laws—Laws set forth to keep rules and regulations consistent among states. Mainly to regulate commercial transactions. States can choose to adopt or not adopt such laws. iii. Uniform Commercial Code—UCC—Issued in 1952 with joint effrorts from NCCUSL and the American Law Institute. Common laws to facilitate Commercial transactins within the 50 states, virgin islands, and District of Columbia. iv. NCCUSL revises articles in the UCC and submits to the states for adoption. 3. Administrative Laws—Rules, orders and decisions of administrative agencies. A. Administrative Agency—a federal, state, or local government agency established to perform a specific function. FDA, EPA…etc… i. Federal Agencies—Cabinet departments within the executive branch. Federal (national) level agencies that regulate within all 50 states. FDA is part of the Department of Health and Human Services. Exec. Agencies are subject to approval by the president. ii. Independent Regulatory Commissions—Fed. Trade Commission. Pres power less pronounced. iii. State and Local Agencies—these are local and state agencies (EPA). 4. Case Law & Common Law Doctrines—Interpretations and constitutional provisions, of statutes enacted by legislatures and regulations created by administrative agencies. A. Case Law—doctrines and principles announced in cases—governs all areas not covered by statutory law or administrative law and is part of our common law traditions. i. Case Law and Common Law Doctrines—The interpretation of constitutional provisions of statutes enacted by legislatures, ad of regulations created by admin. agencies. IV. Common Law Tradition-Law traditions set forth by English traditions which have evolved within the centuries. Knowledge about these laws is required to understand law today. 1. Early English Courts—Dates back to 1066 when Normans conquered England. A. Curiae regis- Kings courts established by William the Conqueror. i. King’s court only granted limited types of remedies-mediation for right and wrong. ii. Remedies included awards for land, items of value, and money for wrongful acts. iii. Courts that awarded remedies became Courts of Law. iv. Remedies today take the form of monetary damages-a dollar amount given to whose legal interest has been injured B. Courts of Equity and Remedies in Equity i. Chancellor-Advisor to the king that had the power to decide on behalf of the king for petitions not otherwise resolved in courts of law. ii. Equitable remedies—equities that include specific performance, injunction (to stop an action), and rescission (contractual end). C. Equitable Maxims—propositions or general statements of equitable rules. (see, pp. 9, Exhibit 1-2) i. Laches—Negligent or lax ii. Defense—an argument raised by the defendant iii. Defendant—party being sued. iv. Plaintiff—Suing party. v. Petitioner—the party bringing the lawsuite in an equitable proceeding. vi. Respondent—the party being sued by a petitioner. 2. Legal and Equitable Remedies Today A. Establisment of medieval courts resulted in 2 types of court: 1) Court of law and 2) court of equity. i. Systems had different types of judges that could grant different types of remedies. ii. TODAY—both types of courts are combined into one and one judge can grant either equity or law reliefs. 3. Doctrine of Stare Decisions A. Common Law is judge made law. i. Case presedents—judges attempts to keep everything consistent based on previous cases. New decisions can cause new laws. ii. Year Books—early documentation of cases and decisions which are now discontinued. iii. Reporters—today reporters are used in place of year books. B. Stare Dicisis and the Common Law Tradition i. Stare Decisis—“to stand on decided cases” the practice of relief based on cases past. ii. Binding Authority—a case precedent, statue, or other resource of law that a court must follow when deciding a case. iii. Departure from the precedent—when a court decides that a precedent should no longer be followed. iv. Case of first impression—a judjment when no precedence is being followed. v. Persuasive authorities—when a court seeks outside help to make a decision. vi. Public Policy—Governmental policy based on widely held societal values. 4. Stare Decisis and Legal Reasoning A. Reasoning process used by judges to grant reliefs based on past cases. 5. Basic Steps in Legal Reasoning. A. 4 basic steps--IRAC i. Issues—What are the issues? ii. Rules—What rules of law apply to the case? iii. Apply—How do the rules of law apply to the particular facts and circumstances of this case iv. Conclusion—What conclusion should be drawn? 6. Forms of Legal Reasoning—Three forms:1) Deductive, linear, and reasoning by analogy. A. Deductive Reasoning—also called syllogistic reasoning because it employs SYLLOGISM, reasoning that involves a premise, a minor premise, and a conclusion. B. Linear Reasoning—reasoning that proceeds from one point to another with the final point being the conclusion. C. Reasoning by Analogy—to compare the facts in the case at hand to the facts of other cases. If the facts are the same, rule the same as the last case. V. The Common Law Today 1. Common law doctrines and principles govern all areas not covered by statutory or administrative law. A. Continuing Importance of the Common Law—the courts when interpreting statutory law often rely on common law as a guide o what the legislators intended. B. Restatements of the Law—compilation of the common law as drafted an published by the American Law Institute. VI. Classifications of Law 1. Substantive Law/Procedural Law A. Substantive Law-consists of all laws that define, describe, regulate, and create legal rights and obligations. B. Procedural Law-consists of all laws that delineate the methods of enforcing rights established by substantive law. C. Civil Law and Criminal Law-the rights and duties that exist between persons and between persons and their governments, as well as the relief available when a person’s rights are violated. D. Criminal Law-wrongs committed against the public as a whole. E. Cyber Law-emerging body of law that governs transctions cnduted via the Internet. VII. How to Find Primary Sources of Law 1. A citation is a reference to a publication in which legal authority such as statue or a court decion or other source can be found. You can use citations to find primary sources of law. A. Finding Statutory and Administrative Law i. United States Code—an organization and arrangements of laws by subject. Example-15 USC Section 1—means statute can be found in section 1 of title 15 ii. USC and other citations are also published by private parties to facilitate the search for references. iii. Online searchable engines are available for public use to find citations. iv. State Code also follow USC code patterns. These may be called codes, revisions, compilations, consolidations, general statutes, or statutes, depending on the preferences by the state. v. Administrative Rules—rules and regulations adopted by fed admin agencies. B. Finding Case Law