Chapter 3: Business Ethics, Social Forces

Protection of the State (treason, taxes)

The legal and constitutional mechanisms by which a government defends its sovereignty, enforces loyalty (e.g. treason laws), and secures resources (e.g. taxation) to maintain order, security, and institutional authority.

1. Treason (U.S. Constitution): The act of levying war against the United States or aiding its enemies. Requires two witnesses or confession in open court (Article III, Section 3).

2. Purpose of Treason Law: Protects national sovereignty while preventing political abuse; ensures only serious betrayal qualifies as treason.

3. Taxation Power (14th Amendment): States can impose taxes, but must follow due process and equal protection. General taxes need minimal procedure; special taxes require notice and opportunity to contest.

4. Strategic Role of Taxes: Taxes fund defense, law enforcement, and regulatory systems—core tools for protecting the state.

5. Tax Resistance vs. Treason: Tax protests may escalate to treason if they challenge state legitimacy or authority (e.g., Shays’ Rebellion, Whiskey Rebellion).

Protection of the Person (criminal law-murder, battery)

The body of criminal laws designed to safeguard individuals from physical harm, including offenses like murder (unlawful killing with intent) and battery (intentional, offensive physical contact without consent). These laws uphold personal safety and bodily integrity as core state interests.

1. 18 U.S. Code § 1111 defines murder as unlawful killing with malice aforethought.

2. 2. Battery is governed by state criminal codes; typically defined as intentional, non-consensual physical contact causing harm or offense.

Protection of Public Health, Safety & Moral (police power-food, inspections, compulsory inoculations, quarantine, liquor, tobacco, seat belts, pornography, location of adult book stores…)

The exercise of a state's police power to regulate behavior and enforce laws that promote the general welfare. This includes measures like food inspections, compulsory vaccinations, quarantine, regulation of liquor and tobacco, seat belt laws, and restrictions on obscenity or adult businesses—all aimed at preserving public health, safety, and societal standards.

1. Jacobson v. Massachusetts (1905) upheld compulsory vaccination under police power.

2. Zoning laws regulate adult bookstores and liquor sales under local ordinances.

3. CDC authority derives from Article I, Section 8 (Commerce Clause) for federal health regulation.

Protection of Property (thief steals a car)

The legal principle that safeguards individuals’ ownership rights against unlawful interference. Criminal laws like theft prohibit unauthorized control over another’s property—such as stealing a car—with intent to deprive the owner of its value or use.

1. Indiana Code § 35-43-4-2 defines theft as unauthorized control over property with intent to deprive.

2. 18 U.S. Code § 2312–2313 criminalizes interstate transport and sale of stolen vehicles7.

Protection of Title (protects the title of the owner of the property - if stolen - true owner can recover it)

A legal principle that secures the rightful ownership of property. If property is stolen or wrongfully transferred, the true owner retains legal title and can recover it—even from someone who unknowingly purchased it—because possession does not override ownership.

• Title theft is prosecuted under fraud and forgery statutes.

• County recorders offer property fraud alert systems to monitor unauthorized title changes9.

Freedom of Personal Action (free speech, religion, press)

A constitutional protection—primarily under the First Amendment—that guarantees individuals the right to express themselves (free speech), practice their beliefs (freedom of religion), and share information or opinions (freedom of the press) without undue government interference. These rights form the foundation of personal autonomy and democratic participation.

1. U.S. Constitution, Amendment I prohibits government interference in speech, religion, and press11.

2. Limits include obscenity (Miller v. California), defamation, and time-place-manner restrictions.

Freedom of Use of Property (with limits - real and personal)

The legal right to control, enjoy, and dispose of one’s real (land, buildings) and personal (movable) property—subject to limits imposed by law. These limits include zoning, environmental regulations, nuisance laws, and public health restrictions, all grounded in the state’s police power and constitutional due process protections.

1. Fifth Amendment Takings Clause: “nor shall private property be taken for public use without just compensation”14.

2. Regulatory takings doctrine applies when use is restricted without physical seizure.

Enforcement of Intent (contracts - wills)

A legal principle ensuring that the genuine intentions behind agreements—such as contracts and wills—are honored and upheld. Courts interpret and enforce these documents to reflect the parties’ or testator’s true purpose, even amid ambiguity or disputes, provided legal formalities (e.g. writing, capacity, consent) are met.

1. Uniform Commercial Code (UCC) governs contract enforceability.

2. Indiana Code § 29-1-6-1 outlines rules for interpreting testamentary intent in wills.

Protection from Exploitation, Fraud and Oppression (minors, unfair competition, discrimination)

A legal principle that shields vulnerable individuals—such as minors—and market participants from deceptive, coercive, or discriminatory practices. It includes laws against fraud, unfair competition, and discrimination, aiming to ensure fairness, autonomy, and equal treatment in both personal and commercial contexts.

1. Fair Labor Standards Act (FLSA) sets child labor protections.

2. EEOC regulations prohibit employment discrimination under Title VII of the Civil Rights Act.

3. Federal Trade Commission Act addresses unfair competition and consumer fraud.

Furtherance of Trade (installment sales, checks, promissory notes)

A legal and economic principle that promotes commercial activity by recognizing and enforcing instruments like installment sales, checks, and promissory notes. These tools facilitate credit, payment, and contractual reliability—enabling efficient transactions and supporting the broader flow of goods and services in the market.

1. UCC Article 3 governs negotiable instruments including checks and promissory notes.

2. Indiana Code § 26-1-3.1-104 defines promissory notes and sets enforceability standards.