Business Law: Legal Heritage and the Digital Age

What is Law?

• Consists of rules that regulate conduct of individuals, businesses, and other organizations in society.
• Intended to protect people and their property from unwanted interference from others.
• Forbids individuals from engaging in certain undesirable activities.

Definition of Law

• Body of rules of action or conduct prescribed by controlling authority and having binding legal force.
• To be obeyed and followed by citizens, subject to sanctions or legal consequences.

Functions of the Law

• Keeping the peace.
  • Maintaining order by preventing violence and resolving disputes.
• Shaping moral standards.
  • Reflecting and promoting societal values and ethics.
• Promoting social justice.
  • Ensuring equal opportunity and fairness in society.
• Maintaining the status quo.
  • Preserving existing power structures and social norms.
• Facilitating orderly change.
  • Enabling gradual and predictable societal evolution through legal reforms.
• Facilitating planning.
  • Providing a stable framework for individuals and businesses to make informed decisions.
• Providing a basis for compromise.
  • Offering mechanisms for conflict resolution and negotiation.
• Maximizing individual freedom.
  • Protecting individual rights and liberties against undue interference.

Qualities of the Law

• Fairness-
  • The U.S. legal system is comprehensive, fair, and democratic.
  • Ensures impartiality and equal treatment under the law.
• Flexibility-
  • The U.S. law evolves and changes along with the norms of society, technology, and the growth and expansion of commerce in the U.S. and the world.
  • Adapts to changing social, economic, and technological conditions.
• U.S. Supreme Court case Brown v. Board of Education is an example of flexibility of the law.
  • Landmark case demonstrating the law's capacity to evolve and address injustices.

Schools of Jurisprudential Thought

• Jurisprudence: The philosophy or science of law.

Natural Law School

• Law is based on what is "correct."
  • Derives from inherent moral principles and human reason.
• Law should be based on morality and ethics.
  • Aligns with universal principles of justice and fairness.

Historical School

• Law is an aggregate of social traditions and customs.
  • Reflects the cumulative wisdom and experience of a society.
• Changes in the norms of society will gradually be reflected in the law.
  • Evolves organically with societal values and practices.

Analytical School

• Law is shaped by logic.
  • Emphasizes rationality and systematic reasoning.
• Results are reached by applying principles of logic to specific facts of a case.
  • Focuses on deductive reasoning and legal formalism.
• Emphasis is on the logic of result rather than on how the result is reached.
  • Prioritizes the correctness of the outcome over the process.

Sociological School

• Law is a means of achieving and advancing certain sociological goals.
  • Views law as an instrument for social change and betterment.
• Purpose of law is to shape social behavior.
  • Aims to influence conduct and promote societal welfare.

Command School

• Law is a set of rules developed, communicated, and enforced by the ruling party.
  • Originates from authoritative decrees and directives.
• The law changes when the ruling class changes.
  • Subject to the will and interests of the governing power.

Critical Legal Studies School

• Legal rules are unnecessary.
  • Questions the legitimacy and neutrality of legal principles.
• Used by the powerful to maintain status quo.
  • Critiques law as a tool for perpetuating social inequalities.
• Legal disputes should be solved by applying arbitrary rules based on notions of what is fair.
  • Rejects formal legal reasoning in favor of contextual justice.

Law and Economics School

• Promoting market efficiency should be the central concern of legal decision making.
  • Applies economic principles to legal analysis and policy.

History of American Law

• English system of law was adopted as a system of jurisprudence in early American colonies-
  • Foundation based on which American judges developed common law in America
  • The historical roots of American law can be traced back to the English legal system, which heavily influenced the development of jurisprudence in the early American colonies. This adoption provided a base upon which American judges began to shape and develop common law specific to the American context.

English Common Law

• Developed by judges who issued opinions when deciding cases.
  • Judge-made law based on precedent and tradition.
• Principles announced in cases became precedent for later judges deciding similar cases.
  • Establishes a system of consistent and predictable legal standards.

Law Courts

• Uniform system of law.
  • Standardized rules and procedures applied across jurisdictions.
• Relief available was monetary award for damages.
  • Primarily focused on compensating for economic losses.

Courts of Chancery (equity courts)

• Formed to surpass limited remedies of law courts.
  • Offered remedies beyond monetary compensation, such as injunctions and specific performance.
• Equitable remedies shaped to fit each situation.
  • Provided flexible and tailored solutions to address unique circumstances.

Merchant Courts

• Solved commercial disputes based on trade practices and usage.
  • Specialized tribunals for resolving business-related conflicts.

Sources of Law in the United States

Constitutions

• The Constitution of the United States of America is the supreme law of the land.-
  • Establishes the fundamental principles and framework of the federal government.
• Any law that conflicts with it is unconstitutional and unenforceable.
  • Ensures the supremacy of constitutional law over all other laws.
• Establishes structure of federal government-
  • Legislative branch
  • U.S. Congress, responsible for enacting federal laws.
  • Executive branch
  • President and administrative agencies, responsible for enforcing federal laws.
  • Judicial branch
  • Federal courts, responsible for interpreting federal laws.
• States have their own constitutions, which are often modeled on the U.S. Constitution.
  • Establish the structure and principles of state government.

Treaties

• The President, with the advice and consent of two-thirds of the Senate, may enter into treaties with foreign governments.
  • Formal agreements between the United States and other nations.
• Treaties become part of the supreme law of land.
  • Have the same legal authority as federal statutes.

Federal Statutes

• Written laws that establish certain courses of conduct that covered parties must adhere to.
  • Enacted by the U.S. Congress and codified in the United States Code.
• The U.S. Congress must find specific authority in the U.S. Constitution (such as the commerce, tax, and spend clauses) to enact federal statutes.
  • Legal authority for federal laws must be grounded in constitutional powers.
• Federal statutes are organized in to code books-
  • Code books constitute codified law

State Statutes

• State legislatures enact state statutes.
  • Written laws that apply within the boundaries of a particular state.

Ordinances

• Law enacted by local government bodies.
  • Laws passed by city councils, county boards, or other local entities.
• Ordinances are codified.
  • Organized and compiled into municipal codes.

Executive orders

• Issued by the president and state governors.
  • Directives from the executive branch that have the force of law.
• Power derived from express delegation from the legislative branch and implied from U.S. Constitution and state constitutions.

Regulations and Orders of Administrative Agencies

• Established by legislative and executive branches of federal and state governments.
  • Agencies created to implement and enforce specific laws.
• Adopt rules and regulations to interpret statutes.
  • Provide detailed guidance on compliance with legal requirements.
• Hear and decide disputes.
  • Adjudicate administrative cases and enforce regulatory standards.

Judicial decisions

• Federal and state courts issue judicial decisions.
  • Rulings by courts that resolve legal disputes.
• Judicial decisions state the rationale used by the court in reaching that decision.
  • Explain the legal reasoning and analysis applied by the court.
• Doctrine of Stare Decisis: Past court decisions become precedent for deciding future cases.-
  • Promotes consistency and predictability in the application of law.
• Lower courts must follow precedent established by higher courts.
  • Ensures hierarchical adherence to legal principles.

Priority of Law in the United States

• The U.S. Constitution and treaties take precedence over all other laws.
  • Represent the supreme legal authority in the nation.
• Federal statutes take precedence over federal regulations.
  • Statutory law enacted by Congress prevails over agency rules.
• Valid federal law takes precedence over conflicting state or local law.
  • Federal law preempts state or local laws that are inconsistent.
• State constitutions rank as the highest state law.
  • Establish the fundamental principles of state government.
• State statutes take precedence over state regulations.
  • Statutory law enacted by state legislatures prevails over agency rules.
• Valid state law takes precedence over local laws.
  • State law preempts local ordinances that are inconsistent.

Digital Law

• The electronic age arrived before new laws were written that were specific for this environment.
  • Legal frameworks often lag behind technological advancements.
• Courts have applied existing laws to the new digital environment by requiring interpretations and applications.
  • Adapting traditional legal principles to address novel issues.
• Congress has enacted new federal statutes to regulate the digital environment.
  • Creating specific laws to govern online activities and cyberspace.

Critical Legal Thinking

• Consists of investigating, analyzing, evaluating, and interpreting information to solve simple or complex legal issues or cases.
  • Involves intellectual rigor and analytical skills.
• Requires intellectually disciplined thinking.
  • Emphasizes logical reasoning and objective analysis.

Socratic method

• Series of questions and answers-
  • Interactive dialogue between instructor and student.
• Give-and-take inquiry and debate between a professor and student
  • Encourages critical thinking and deeper understanding of legal concepts.

IRAC Method

• Used to examine a law case-
  • Framework for analyzing legal issues.
• I (issue); R (rule); A (analysis); C (conclusion)
  • Structured approach to case briefing and legal problem-solving.

Case 1.1: Affirmative Action in University Admissions

• Case- Fisher v. University of Texas at Austin
  • Landmark Supreme Court case on affirmative action.
• Supreme Court of the United States
  • Highest court in the federal judiciary.
• Issue- Is the race-conscious admissions program at the University of Texas lawful under the Equal Protection Clause?
  • Addresses the constitutionality of considering race in college admissions.