OBE 118 Legal Environment of Business

INTRODUCTION
Dr. Donald L. Carper

Law is powerful
Affects all people, from CEOs to children Affects most of life, from work to leisure
But which is more important -- written law or the people who enforce it?

Law is important

Law is fascinating

Complex, but never just theoretical

 To examine law is to examine social life One person alone does not require law

Any investigation about law could begin or include

Definitions of law Philosophy of law History of law Functions of law and Sources of law

All of these topics are interrelated

Whatever definition of law chosen there exists a set of rules or general standards of conduct, established and enforced by government officials. Law consists of

Norms (standards of behavior)

Regularly enforced by coercion

By persons authorized by society

As stipulated by courts of law

Classifications & Categories of LAW helpful to understanding law

Classifications & Categories of Law helpful to understanding Law

PUBLIC LAW PRIVATE LAW CRIMINAL LAW CIVIL LAW SUBSTANTIVE LAW PROCEDURAL LAW

COMMON LAW STATUTORY LAW LAW EQUITY

Private v. Public Law

Public law: Body of law directly concerned with public rights and obligations. Private law: Body of law regulating the rights and duties existing between private persons. The rights and duties are created by the affected parties.

Civil v. Criminal Law

Civil law: Body of law directly concerning the rights and duties between parties. Criminal law: Body of law dealing with crimes and their punishment

CONTRAST BETWEEN CIVIL AND CRIMINAL LAW Civil Criminal

Nature

Person Initiating Action Burden of Proof in Trial Result sought

Rights and duties of individuals to each other Plaintiff or person injured

Preponderance of the evidence Money damages or equitable remedy

Wrongs against society as a whole

Either federal, state, or local prosecutor Beyond a reasonable doubt Death, fine or imprisonment

Substantive v. Procedural Law

Substantive law: General principles and detailed rules defining legal rights and duties. Procedural law: General principles and detailed rules that define the methods of administering the substantive law

SUBSTANTIVE LAW: General principles and detailed rules defining legal rights and duties. Example of a substantive law Definition of minor: a person below the age of legal competence. For most purposes, in most states, minority ends at age 18. For some purposes, such as the purchase and consumption of alcoholic beverages, it may end later, up to the age 21.

Procedural Law Examples

Rules of evidence such as the hearsay rule Method of filing a lawsuit such as the requirement of a complaint and service of summons To be able to seize assets of a judgment debtor the law requires a creditor to file an affidavit as to the debtors ownership of any assets to be seized

EXAMPLES
Substantive law
Agency

Procedural law
Administrative procedure

Contracts
Criminal law Partnerships Torts

Appellate procedure
Criminal procedure Evidence Civil procedure

EXAMPLES
Substantive law
Agency Contracts Criminal law Partnerships

Procedural law
Administrative procedure Appellate procedure Criminal procedure Evidence

Torts

Civil procedure

Case: Oculist's Case (1329), p. 8

This seal was found in the bed of the Moselle River in France. The Romans were the first people to have specialized eye doctors, called oculists, who were devoted to treating eye diseases such as cataracts

Case: Oculist's Case (1329), p. 8

The defendant, attempting to heal the plaintiff, left him blind in one eye. The plaintiff has sued in trespass What was the defendants response? Was it procedural or substantive? How did the court rule?

Case: Oculist's Case (1329), p. 8

Consider the underlying facts and the probable legal treatment today.

Common Law v. Statutory Law

Common law: Laws from the courts as opposed to a legislature or court of equity Common law is also called unwritten law. Statutory law: Laws enacted by Congress state legislatures or local government. Statutory law is also called written law.

COMMON V. STATUTORY LAW

Common and also called case law From the courts After the fact Narrow Based on actual situations and conflict Law maker is neutral Law from court cases may be changed in the future by courts or by the legislature

COMMON V. STATUTORY LAW

STATUTORY LAW From the legislature and executive branch Prospective Can be broad or narrow

Can be initiated at any time by legislator

Lawmaker can be an advocate Interpreted by the courts May only be changed by courts only if unconstitutional

COMMON LAW

STATUTORY LAW

Creation

Judicial branch through decisions in cases appearing before the courts Rules found in official fact patterns & decisions of prior cases

Legislative branch through a formal lawmaking process

Form

Codified text

Scope

Narrow-limited to actual cases

Indirect-judges somewhat insulated from political pressure

Broad-subject only to constitutional limitations

Direct-Through the political process

Effects of Social Forces

STATUTES, CODES, AND ORDINANCES

STATUTE

Single Legislative enactment. A completed and signed bill. Statute indexed by subject matter or a comprehensive statute City or County Statute

CODE

ORDINANCE

Equity
Equity: A civil trial held without a jury when relief sought by the plaintiff is equitable in nature, such as an injunction, or a divorce or dissolution of a marriage. Other than equity: Often referred to as the common law.

Equity
Subject Matter
Family law, matter juvenile, probate trusts, foreclosure, when remedy it law is inadequate No jury-chancellor of trial makes findings and a issues degree Specific performance, injunction, recission, restitution, reformation

Other than Equity

Everything but equity

Fact Finding Remedies Enforcement

Jury-leading to judgment Money damages or replevin

Contempt of court

Can attach defendants property

SOURCES OF LAW
Constitutional law Treaties Administrative law Statutory law Case law Federal law State law

Constitutional
State constitutions are supreme within their own borders to the extent that they do not violate The U.S. Constitution or are inconsistent is the Supreme Law with the U.S. of The United States. Constitution or other federal law.

SOURCE TREATIES

DESCRIPTION

Agreements With Foreign Nations made by the President and ratified by a 2/3 vote of the Senate. An Exclusive Federal Function.

SOURCE

DESCRIPTION

STATUTORY LAW

Created by Federal, State, and Local Legislatures or Governing Bodies.

Neither Federal Nor State Statutes are Valid if in-consistent with the U.S. Constitution.
State Statutory Law is invalid if inconsistent with its Constitution. Uniform Statutes Create uniform State Law in those adopting States.

Administrative Law

DESCRIPTION Law Concerned with the power and actions of Administrative agencies at all levels of government. Enabling Legislation from the U.S. Congress create federal administrative agencies. Also created at State and local levels of government. Agency functions include: Rule-making Investigation Enforcement, & Adjudication.

COMMON LAW

DESCRIPTION
Use of past judicial decisions and reasoning through the application of the doctrine of stare decisis-the rule of precedent-in deciding cases. Originated in England. Applies to situations not otherwise covered by statutory law.

COMMON LAW

DESCRIPTION
Use of past judicial decisions and reasoning through the application of the doctrine of stare decisis-the rule of precedent-in deciding cases. Originated in England. Applies to situations not otherwise covered by statutory law.