Business Law I Introduction to Law Hello class and welcome to the week one lecture for Business Law I. We will begin with an introduction to the law and the American Legal system.  Law is a grouping of rules governing relationships among individuals and between individuals and their society.   The function of the law is to maintain stability while allowing for change when necessary.   As we will discuss, this law originates from many sources. To start, America has a rich common law tradition.  Common law dates back to the English Court system.   This common law developed through the slow accumulation of decisions over many hundreds of years.  At bottom, judges generally apply the principle of Stare Decisis or the application of principles applied in earlier cases with similar facts.  These earlier cases are known as precedent.  This principle is important because it allows for a modicum of stability in the law as the idea is that similar cases will be decided in similar ways.  However, this system allows gives the common law some flexibility. Judges may decide that old precedent is no longer applicable, for example, due to changes in society’s attitudes or in technology.   When this situation occurs, the judge can create a new precedent.   The constitution provides another source of law.  The federal constitution creates the rules for governing the country.  It specifies which powers each branch of government may wield, and any state or federal law found to be in conflict with the constitution by the courts will be found to be invalid.  A third source of law is statutory law.  This source of law includes the statutes and ordinances of Congress and state legislatures.  This is a very important source of law, and much of the work of the courts is consumed by interpreting these statutes.   The final source of law to discuss is the administrative law.  The development of this law has become increasingly important. As the economy began to grow more complex, Congress devolved some of its powers to administrative agencies (generally under the supervision of the executive branch) to regulate the economy.   For example, the Clean Air Act requires the Environmental Protection Agency (EPA) to keep the air safe.  This mandate empowers the EPA to pass and enforce regulation protecting society from airborne pollutants.  Although this area of law gets less coverage from the press, it can be critically important as these regulations have a monumental impact on the economy. Judges are frequently called upon to determine if the agencies have exceeded the scope of their mandate. Another important distinction involves the relationship between the federal and state courts.  Each state and the federal government has its own court system.  And each of these entities will often have different statues, common law, administrative law, and constitutions.  States are generally required to follow the decisions of other court’s due to the full faith and credit clause ...

1. Business Law I
Introduction to Law
Hello class and welcome to the week one lecture for Business
Law I. We will begin with an introduction to the law and the
American Legal system. Law is a grouping of rules governing
relationships among individuals and between individuals and
their society. The function of the law is to maintain stability
while allowing for change when necessary. As we will discuss,
this law originates from many sources.
To start, America has a rich common law tradition. Common
law dates back to the English Court system. This common law
developed through the slow accumulation of decisions over
many hundreds of years. At bottom, judges generally apply the
principle of Stare Decisis or the application of principles
applied in earlier cases with similar facts. These earlier cases
are known as precedent. This principle is important because it
allows for a modicum of stability in the law as the idea is that
similar cases will be decided in similar ways. However, this
system allows gives the common law some flexibility. Judges
may decide that old precedent is no longer applicable, for
example, due to changes in society’s attitudes or in technology.
When this situation occurs, the judge can create a new
precedent.
The constitution provides another source of law. The federal
constitution creates the rules for governing the country. It
specifies which powers each branch of government may wield,
and any state or federal law found to be in conflict with the
constitution by the courts will be found to be invalid. A third
source of law is statutory law. This source of law includes the
statutes and ordinances of Congress and state legislatures. This
is a very important source of law, and much of the work of the
courts is consumed by interpreting these statutes.

2. The final source of law to discuss is the administrative law.
The development of this law has become increasingly
important. As the economy began to grow more complex,
Congress devolved some of its powers to administrative
agencies (generally under the supervision of the executive
branch) to regulate the economy. For example, the Clean Air
Act requires the Environmental Protection Agency (EPA) to
keep the air safe. This mandate empowers the EPA to pass and
enforce regulation protecting society from airborne pollutants.
Although this area of law gets less coverage from the press, it
can be critically important as these regulations have a
monumental impact on the economy. Judges are frequently
called upon to determine if the agencies have exceeded the
scope of their mandate.
Another important distinction involves the relationship between
the federal and state courts. Each state and the federal
government has its own court system. And each of these
entities will often have different statues, common law,
administrative law, and constitutions. States are generally
required to follow the decisions of other court’s due to the full
faith and credit clause of the constitution, and where there is a
conflict between state and federal law, the federal law
ordinarily takes precedence because of the supremacy clause of
the United States Constitution unless the federal government
action is found unconstitutional.
Finally, most court systems (including the federal court system)
have different levels First, a court of original jurisdiction will
rule on a case first. This court will hear evidence from
witnesses, and it may have a jury verdict depending on the case.
At this point, most state courts and the federal court system
have an intermediate appellate court. Often, these courts operate
on a regional basis. For example, the federal courts have eleven
circuits. The first circuit, for example, includes Maine,
Massachusetts, Rhode Island and New Hampshire. This circuit

3. will hear appeals from any district court within those states. At
the highest level, there is a court of final appeal. In the federal
system, this is known as the Supreme Court. These courts often
have the discretion to choose which cases they will rule upon. It
should be noted, however, that some state court systems have
only a court of original jurisdiction and a court of final
decision.
W1 Lecture 2 "Jurisdiction"
Content
Business Law I
Jurisdiction
In this lecture, we will be focusing on jurisdiction. Essentially
when we discuss jurisdiction, we are talking about power.
Namely, we are talking about the power of a court that is
binding over particular parties (or property) in a particular type
of case. There are two main types of jurisdiction that you need
to be aware of: subject matter jurisdiction and personal
jurisdiction. Personal jurisdiction refers to the court’s power
over particular persons (in personam) or over property (in rem).
Subject matter jurisdiction refers to the court’s power to hear a
particular type of action.
Personal jurisdiction can be established in many ways. Personal
jurisdiction can be established by residency. Individuals and
corporations are subject to the jurisdiction of the places that
they reside. Additionally, mere presence in a state is sufficient
to give that state jurisdiction over an individual. A third basis
for personal jurisdiction is consent. Even if the courts lack
jurisdiction over an individual, that person may consent to the
jurisdiction of a court. This is often done contractually as many
contracts contain forum selection clauses where the signatories
agree to subject themselves to the jurisdiction of a particular
forum. Furthermore, states often have statutes requiring
corporations doing business in a state or individuals driving in a
state to submit to the personal jurisdiction of that state.

4. Historically, personal jurisdiction was limited to these
situations.
However, as transportation technology and communications
technology improved leading to greater interconnectedness
among the states, there was a need to expand personal
jurisdiction. In the landmark Supreme Court ruling in
International Shoe Co. v. Washington, 326 U.S. 310 (1945), the
court held that states exert jurisdiction over entities not present
or residing in a state, where there are “minimum contacts” with
the forum state and the exercise of jurisdiction comports “with
traditional notions of fair play and substantial justice.”
Following these guidelines, the states drafted long-arm statutes
that specify when the courts will assert jurisdiction over an out-
of-state defendant.
The next type of jurisdiction to discuss is subject matter
jurisdiction. This refers to the court’s power over a particular
kind of case. To this end, courts may have plenary or limited
jurisdiction. A court with plenary jurisdiction is empowered to
hear a wide variety of matters. Courts of limited jurisdiction are
empowered to hear specific kinds of case. Examples of these
courts include bankruptcy courts or small claims courts.
We will conclude our discussion of jurisdiction with an
examination of these principles as applied in the federal court
system. Generally, the federal courts will apply the personal
jurisdiction rules of whatever state in which the court is
located. As for subject matter jurisdiction, the federal courts
have jurisdiction in federal question cases and in diversity
cases. In federal question cases, the case must originate under
federal law. These include matters such as copyright.
Additionally, the federal court’s have subject matter jurisdiction
in diversity cases. These are cases where all plaintiffs and all
defendants are from different (or "divers”) jurisdictions and the
amount of controversy is at least $75,000.
It’s important to note that in federal question cases there may be
concurrent jurisdiction. This is found in cases where either a

5. state or a federal court has subject matter jurisdiction over a
suit. In some cases only a federal court has power to render a
decision, this is known as exclusive jurisdiction. For example,
the federal court has exclusive jurisdiction over patents and
bankruptcy.