PART

PART

Foundations of American Law

The Nature of LawThe Resolution of Private Disputes

Business and The ConstitutionBusiness Ethics, Corporate Social

Responsibility, Corporate Governance, and Critical Thinking

1

McGraw-Hill/Irwin Business Law, 13/e

© 2007 The McGraw-Hill Companies, Inc. All rights reserved.

The Nature of Law

PA ET RHC 1“The sacred rights of mankind . . . are written, as with a sun beam in the whole volume of human nature, . . . and can never be erased or obscured by mortal power.”

Alexander Hamilton, 1775

Learning Objectives

Types and sources of law Important legal doctrines Classification of law Jurisprudence and legal reasoning Statutory interpretation Limitations on judicial power

1 - 4

Types or Sources of Law

Federal, state, and tribal level: U.S. Constitution: establishes

governmental structure, specific rights and duties

Statute: enacted by legislative body to regulate conduct

Common Law: case law (judge-made) Administrative Law: agency rules to

implement enforcement of statutes

1 - 5

Types or Sources of Law

Issued at chief executive level: Executive Order: under limited

powers Treaty: with other nations, by the

U.S. president on behalf of the nation, and ratified by the U.S. Senate

1 - 6

Important Doctrines Stare Decisis (let the decision stand)

Doctrine of precedent applied in common law

Equity Applied by the judiciary to achieve justice

when legal rules would produce unfair results

Federal supremacy: Rule of priority for conflicts between laws

that holds U.S. Constitution the supreme law of land (Art. VI, Sec. 2, U.S. Constitution)

1 - 7

Classification of Law Criminal law establishes duties to society

Government charges and prosecutes defendant, who is found guilty or innocent

Civil law establishes duties between private parties Plaintiff sues defendant for monetary

damages or equitable relief

1 - 8

Classification of Law

Substantive law establishes rights and duties of people in society

Procedural law establishes how to enforce those rights and duties

Public law refers to the relationship between governments and private parties

Private law refers to the regulation of conduct between private parties

1 - 9

Jurisprudence

Jurisprudence refers to the philosophy of law as well as the collection of laws

Legal positivism: law is the command of a recognized political authority

Natural law: universal moral rules bind all people whether written or unwritten See U.S. v. Lynch

1 - 10

Jurisprudence

Legal realism defines law as the behavior of the judiciary as they rule on matters within the legal system

Sociological jurisprudence unites theories that examine law within its social context

1 - 11

Legal Reasoning

Basically deductive, with the legal rule as the major premise and facts as the minor premise

Court may stand on precedent or distinguish prior case from current case If precedent inapplicable, new rule

developed See Hagan v. Coca-Cola Bottling Co.

1 - 12

Statutory Interpretation Plain meaning rule: court applies statute

according to usual meaning of the words See Hyatt v. Anoka Police Department

A court examines legislative history and purpose when plain meaning rule is inadequate See General Dynamics Land Systems, Inc. v. Cline

Courts may interpret a statute in light of a general public purpose or public policy

1 - 13

Limitations on Judicial Power

Courts limited to deciding existing cases or controversies

Parties must have standing (direct interest in the outcome) to sue

1 - 14

Do plants and animals have legal standing?

Global Business Environment

Courts may faced with treaty interpretation

The U.S. Supreme Court interpreted The Warsaw Convention in Olympic Airways v. Husain

How would you have interpreted the treaty language?

1 - 15

“The carrier shall be liable for damage sustained in the

event of the death or wounding of a passenger or

any other bodily injury suffered by a passenger, if the accident which caused

the damage so sustained took place on board the

aircraft or in the course of the operations of embarking

or disembarking.” Warsaw Convention, Art. 17

Test Your Knowledge True=A, False = B

The Constitution, statutes, and case law are sources of law in the United States

Agency regulations, presidential orders, and treaties are sources of law in the United States

Stare decisis refers to the doctrine of equity

The Supremacy Clause states that the U.S. Constitution is the supreme law of the land

1 - 16

Test Your Knowledge

True=A, False = B Civil law establishes the duties an

individual has to keeping a civil society Substantive law establishes how to

enforce the rights and duties of people in society

Jurisprudence refers to the philosophy of law as well as the collection of laws

Legal reasoning is basically inductive

1 - 17

Test Your Knowledge

Multiple Choice The plain meaning rule means that the

court applies a statute (a) according to the unique or special

meaning of words (b) according to usual meaning of the

words (c) according to public policy and

legislative purpose

1 - 18

Test Your Knowledge Multiple Choice

Courts are: (a) Limited to hearing existing cases or

controversies (b) Limited to hearing cases in which

the plaintiff has standing (a direct interest in the outcome)

(c) Unlimited in types of cases they may hear

(d) All of the above (e) Both A & B

1 - 19

Thought Question

What do you think the authors of the U.S. Constitution would think about current legal issues in our society?

1 - 20