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Chapter 1 - The Nature of Law


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Chapter 1 - The Nature of Law

  1. 1. The Nature of Law The Resolution of Private Disputes Business and The Constitution Business Ethics, Corporate SocialResponsibility, Corporate Governance, and Critical Thinking © 2010 The McGraw-Hill Companies, Inc. All rights reserved.
  2. 2. The Nature of LawThe sacred rights ofmankind . . . are written, aswith a sun beam in the wholevolume of human nature, . . .and can never be erased orobscured by mortal power. Alexander Hamilton 1775 © 2010 The McGraw-Hill Companies, Inc. All rights reserved.
  3. 3. Learning Objectives Types and sources of law Important legal doctrines Classification of law Jurisprudence and legal reasoning Statutory interpretation Limitations on judicial power1-3
  4. 4. Types and Classifications of Law Federal, state, and tribal level:  Constitution: establishes governmental structure, specific rights and duties  Example: U.S. Constitution  Statute: enacted by legislative body to regulate conduct  Example: Clean Air Act, 42 U.S.C. §§ 7401 et seq. (1970)  Counties and municipalities enact “ordinances” (e.g., zoning ordinance)1-4
  5. 5. Types and Classifications of Law Federal, state, and tribal level:  Common Law: case law (judge-made)  Example: Gribben v. Wal-Mart Stores, Inc.  Administrative Law: agency rules to implement enforcement of statutes  Example: U.S. Environmental Protection Agency’s Identification and Listing of Hazardous Waste Rule, 40 CFR – Part 261, as amended, 73 FR 647601-5
  6. 6. Types and Classifications of Law Issued at the chief executive level:  Executive Order: under limited powers  Examples: /news/orders/  Treaty: with other nations, by the U.S. president on behalf of the nation, ratified by the U.S. Senate  Example: The Antarctic Treaty1-6
  7. 7. Important Doctrines Stare Decisis (let the decision stand) is the doctrine of precedent applied in common law  Example: in Gribben v. Wal-Mart Stores, the Indiana Supreme Court cited Cahoon v. Cummings for a well-established rule about intentional first-party spoliation of evidence Equity is applied by the judiciary to achieve justice when legal rules would produce unfair results  Examples: injunction or specific performance1-7
  8. 8. Important Doctrines Federal supremacy: a rule of priority for conflicts between laws that holds the U.S. Constitution is the supreme law of the land  Supremacy Clause, Article VI, Section 2, of the U.S. Constitution  Practical meaning:  Federal law defeats state law  A state constitution defeats state legislation  A statute defeats an administrative regulation  A statute or regulation defeats common law1-8
  9. 9. Trentadue v. Gorton Facts & Procedural History:  Trial court decided that the common law discovery rule applied to claims against corporate defendants for crime of an employee rather than statute of limitations and appellate court affirmed Issue: Does a legislated rule (statute of limitations) abrogate a common law rule? Holding: Yes; plain language of statute indicated legislative intent to exclude common law rules1-9
  10. 10. Classification of Law Criminal law establishes duties to society  Government charges and prosecutes defendant, who is found guilty or innocent  A convicted defendant will be imprisoned or fined1 - 10
  11. 11. Classification of Law Civil law establishes duties between private parties  Plaintiff sues defendant for monetary damages or equitable relief  A defendant will be held liable or not liable1 - 11
  12. 12. Classification of Law Substantive law establishes rights and duties of people in society  Example: The act of murder is a crime Procedural law establishes how to enforce those rights and duties  Example: A defendant charged with murder has the right to a jury trial1 - 12
  13. 13. Classification of Law Public law refers to the relationship between governments and private parties  Examples: constitutional, statutory, and administrative law Private law refers to the regulation of conduct between private parties  Examples: contract, tort, and property laws1 - 13
  14. 14. 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  Just or unjust, law must be obeyed Natural law: universal moral rules bind all people whether written or unwritten  Unjust positive laws are invalid1 - 14
  15. 15. Jurisprudence Legal realism defines law as the behavior of the judiciary as they rule on matters within the legal system  Thus law in action dominates positive law Sociological jurisprudence unites theories that examine law within its social context1 - 15
  16. 16. Legal Reasoning Basically deductive, with legal rule as major premise and facts as the minor premise  Result is product of the two Court may stand on precedent or distinguish prior case from current case  If precedent inapplicable, new rule developed1 - 16
  17. 17. Hagan v. Coca-Cola Bottling Co. Facts & Procedural History:  Florida plaintiffs drank from bottle of Coke, found foreign object, suffered emotional distress, and brought suit for negligence  Jury returned verdict for plaintiffs, judge reduced jury award, and both parties appealed  Certified question sent to Florida Supreme Court Question: Should the impact rule (physical injury required to state a claim) be abolished or amended in Florida?1 - 17
  18. 18. Hagan v. Coca-Cola Bottling Co. Court’s Reasoning:  Reviewed facts and arguments of parties  Reviewed application of impact rule within Florida, including modifications to the rule  Discussed public policy recognized by the Florida Supreme Court in Doyle v. Pillsbury Co.  Noted court decisions in other states Holding: Impact rule does not apply where emotional damages are caused by conduct that is a freestanding tort (e.g., contaminated food)1 - 18
  19. 19. Statutory Interpretation Plain meaning rule: court applies statute according to usual meaning of the words Courts examine legislative history and purpose when plain meaning rule is inadequate  Example A: Why does the Communications Decency Act offer immunity for some entities?  Example B: What is meant by a prohibition against discrimination “because of an individual’s age?”1 - 19
  20. 20. General Dynamics Land Systems, Inc Facts:  Collective bargaining agreement discriminated against workers under 50 years of age; plaintiffs over 40 and under 50 filed a claim under the Age Discrimination in Employment Act (ADEA) Issue:  Does the ADEA forbid “favoring the old over the young?”1 - 20
  21. 21. General Dynamics Land Systems, Inc. v. Cline Reasoning:  Plain meaning of “age” within the statute not clear, but legislative history makes clear that an employer may favor an older employee over a younger one Holding:  Judgment reversed in favor of employer1 - 21
  22. 22. Statutory Interpretation Courts may interpret a statute in light of a general public purpose or public policy Courts follow prior interpretation of a statute (precedent) to promote consistency Maxims may be used to assist in statutory interpretation1 - 22
  23. 23. Statutory Interpretation Example of a maxim:  Ejusdem generis (things of the same type)  When general words follow specific words, the general words are limited to the same things as specific words  “Automobiles and other vehicles” does not include airplanes1 - 23
  24. 24. Limitations on Judicial Power Courts limited to deciding existing cases or controversies  In other words, the dispute must be current and not yet resolved  However, a declaratory judgment allows parties to determine rights and duties prior to harm occurring1 - 24
  25. 25. Limitations on Judicial Power Parties must have standing (direct interest in the outcome) to sue  Whales, for example, do not have standing  The Cetacean Community v. Bush, 386 F.3d 1169 (9th Cir. 2004)1 - 25
  26. 26. Global Business Environment Courts may faced with treaty interpretation “The carrier shall be liable for damage sustained in the event U.S. Supreme Court of the death or wounding of a passenger or any other bodily injury suffered by a passenger, interpreted The Warsaw if the accident which caused the damage so sustained took Convention in place on board the aircraft or in the course of the operations Olympic Airways v. Husain of embarking or disembarking.” How would you have Warsaw Convention, Art. 17 interpreted the treaty language?1 - 26
  27. 27. 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 land1 - 27
  28. 28. 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 inductive1 - 28
  29. 29. 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 purpose1 - 29
  30. 30. Test Your Knowledge Multiple Choice  Courts are: (a) Limited to hearing existing cases or controversies (b) Limited to hearing cases in which 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 & B1 - 30
  31. 31. Thought Question What do you think the authors of the U.S. Constitution would think about current legal issues in our society?1 - 31