Business Law Midterm

law

a body of rules of action or conduct prescribed by controlling authority, and having legal binding force. creates duties, obligations, and rights that reflect accepted views of a given society

jurisprudence

the science and philosophy of law

what are the primary purposes of law?

• to provide a system of order that defines conduct and consequences

• to promote equality and justice in society

• to provide a method for resolving disputes

• to promote good faith dealing among merchants

• to provide a degree of reliability in applying the law evenly

black’s law dictionary

the authoritative source for legal terms, published in 1891

what are the primary sources of American law?

constitutional law, statutory law, common law, and administrative law

constitutional law

the foundation for all U.S. law

establishes: a structure for federal and state governments, federalism which allows the federal and state governments shared powers, and individual civil rights and provides procedural protections for U.S. citizens from wrongful government actions

statutory law/statutes

written laws that are passed by the federal/state legislature and are approved/rejected by the executive branch

ordinances

written laws at the local level, typically regulate zoning issues or health and safety regulations

plain meaning rule

if the words in the statute have clear and widely understood meanings, the court applies the statute in accordance with the rule

statutory scheme

the structure of the statute and the format of its mandates

common law

law made by the courts in order to fill the gaps when a controversy arises that is not covered under existing law

the doctrine of stare decisis

similar cases with similar facts and issues should have similar judicial outcomes

precedent

the notion of applying the law of previous cases to current cases with substantially similar circumstances

administrative law

authorizes the exercise of authority by executive branch agencies and independent government agencies

what are some secondary sources of law?

restatements of the law and some model state statutes (i.e. the Uniform Commercial Code), meant to increase the level of uniformity and fairness across courts in all 50 states, have no independent authority or legally binding effect

restatements of the law

collections of uniform legal principles in a specific area of law that are designed to reduce the complexity of judicial decisions

model statutes

drafted by legal experts in hopes that they will be used or adopted by state legislatures so as to provide uniformity in laws between states

civil laws

designed to compensate parties for losses (damages) as a result of another’s conducts

criminal laws

designed to protect society, violation results in penalties to the violator such as fines or imprisonment. fines do not reimburse the victim

substantive law

provide individuals with rights and create certain duties

procedural law

provides a structure and sets out rules for pursuing substantive rights

law vs. equity

when a remedy at law is inadequate, an injured party may also obtain a remedy at equity

equitable maxims

rules intended to be broad statements of rules that are based on notions of fairness and justice in applying the law

public laws

derived from some government entity, i.e. statutes and administrative regulations

private laws

binding between two parties even though no specific statute or regulation provides for the rights of the parties

what are the major categories of legal strategies?

noncompliance

avoidance

prevention

value creation

noncompliance

openly disregarding or touting from the law

avoidance

creating legal loopholes or exploiting gray areas in the law, views legal compliance as a cost to be minimized

prevention

identifies potential legal risks to one’s business and takes deliberate and proactive measures to minimize those risks before the risks materialize

value creation/legal competitive advantage

using the law creatively and strategically to minimize costs/risks and create new sources of value and generate new streams of revenue

what are the three general functions of the constitution?

1. establish structure for the federal government (3 equal branches)

2. delegates enumerated and limited powers to each coequal branch of the federal government

3. provides procedural protections to citizens/persons/businesses

describe the structure of the constitution

preamble

7 articles

27 amendments

amendment

additions/change to the constitution

enumerated powers

the powers granted to the three branches of federal government in the constitution, limited in scope and each act of the federal government must be authorized by one of the specific enumerated powers listed in the articles

congressional powers

article 1, section 8 authorizes these powers (commerce regulation, tax and spend provisions, regulate bankruptcy/patents/copyrights) to congress. the necessary and proper clause also includes a general implied power to make all laws necessary for carrying out its enumerated powers

executive powers

article 2 grants certain presidential powers that affect business, including the power to carry out laws made by congress, the power to enter into treaties/carry out foreign policy, power to appoint federal officers and judges

executive orders vs presidential proclamations

have the force of law and are issued by the president to carry out executive functions of government vs. a statement issued by the president on a ceremonial occasion or to elaborate an issue of public/foreign policy

judicial powers

article 3 establishes boundaries of jurisdiction for federal courts, which have the power to invalidate state/fedral laws that are inconsistent with the constitution

separation of powers

system of checks and balances that ensures that no one branch becomes overly dominant

rational basis review

the lowest level/least amount of judicial review. government must show that the action advanced a legitimate government objective and that it was somehow related to the government’s objective

intermediate-level scrutiny

government must b=prove that its action advances an important government objective and the action is substantially related to the government’s objective

strict scrutiny

government must prove that it’s objective is compelling, that the means chosen to advance the objective are necessary to achieve that end, and that no less-restrictive alternatives exist

commerce powers

the broadest powers granted to congress are derived from the commerce clause, congress has authority to regulate the channels of interstate commerce, the instrumentalities of interstate commerce, and articles moving in interstate commerce

tax and spend powers

congress has the power to tax the citizenry and spend the federal government’s money in any way that promotes the common defense and general welfare