Introduction to Law 3
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PART ONE: The Legal Environment of Business
Chapter 1 INTRODUCTION TO LAW
SCOPE NOTE
As modern life has become increasingly crowded, complicated, and subject to fast-paced change, our everyday affairs have become more subject to legal scrutiny and regulation. Our daily activities carry profound legal implications. It is therefore important to gain a working understanding of this all-pervasive influencing force in our lives: the American legal system. Chapter One introduces basic terminology, concepts and principles relevant to the nature, origin, and growth of our system of laws. Through understanding the foundations of our legal identities (rights/duties), we will have a useful frame of reference when studying the specific areas of legal inquiry contained in the subsequent chapters. What is law? What is the legal reasoning process? What are the sources of law? These and other fundamental topics are the focus of discussion in Chapter One.
EDUCATIONAL OBJECTIVES
1. Define law and discuss the importance of the phrase, "a society governed by a system of laws.”
2. Enumerate the functions of and purposes served by law.
3. Discuss the "legal analysis" process.
4. Explain the interrelationships among law, morality, and justice.
5. Differentiate among the various classifications of law.
6. Identify the law-making bodies within the American legal system.
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7. Develop the importance of stare decisis in the formation of common law.
8. Trace the historical origins of America's system of laws.
9. Evaluate the significance of the movement towards uniform, codified laws in various arenas of legal regulation.
10. Define and explain the significance of equity.
CHAPTER OUTLINE
I. Nature of Law A. Definition of Law–"a rule of civil conduct prescribed by the supreme power in a state, commanding what is right, and prohibiting what is wrong" B. Functions of Law–the primary function is to maintain stability in the social, political and economic system while at the same time permitting change C. Legal Sanctions–the means by which the law enforces the decisions of the courts D. Law and Morals–are NOT the same. Law and ethics are similar but they differ because rules of law have sanctions; rules of ethics do not E. Law and Justice–without law there can be no justice, but law is no guarantee of justice
II. Classification of Law A. Substantive and Procedural Law–substantive laws create, define, and regulate legal rights and obligations; procedural law sets the rules for enforcing the rights that exist by substantive law B. Public and Private Law–public law consists of constitutional, administrative, and crimi- nal law; private law includes civil and business law C. Civil and Criminal Law–civil law defines duties that, if violated, constitute a wrong against the party injured by the violation; criminal law establishes duties that, if violated, constitute a wrong against the whole community
III. Sources of Law A. Constitutional Law–is established by the U.S. Constitution and the individual state constitutions B. Judicial Law–is established by Federal and State courts 1. Common Law–also called case law (judge-made decisions) 2. Equity–a supplementary court system to courts of law (common law) with its own remedies when no adequate remedy is available at common law 3. Restatements of Law–the authoritative statement of the common law of the United States C. Legislative Law–is established by Federal and State enactments (statutes) 1. Treaties–agreements between or among independent nations 2. Executive Orders–laws issued by the President or by governors of the states Introduction to Law 3
D. Administrative Law–rules and regulations created by Federal, State and local adminis- trative agencies
IV. Legal Analysis–the method of analyzing and briefing Federal and State judicial decisions
TRUE-FALSE: Circle true or false.
T F 1. In order to survive, a civilized society must have an efficient and stable legal system.
T F 2. Civil law is concerned with a wrong against an injured party while criminal law is concerned with a wrong against the whole community.
T F 3. Stare decisis is a doctrine based on present court decisions following previous ones, and it should never be overturned.
T F 4. A "maxim" is a general legal principle formulated over the years by courts of equity.
T F 5. The source of American law superior to all other sources within a state is the state statutes.
T F 6. The government has the burden of proving a defendant guilty of a crime beyond a reasonable doubt.
T F 7. The source of American law to which all other sources are subordinate is a President's executive order.
T F 8. The person who sues in a lawsuit is called the plaintiff, the person being sued is the defendant.
T F 9. The Uniform Commercial Code was prepared and developed to make the law governing commercial transactions uniform within the various jurisdictions of Minnesota.
T F 10. Legal sanctions are the means by which the law enforces the decisions of the courts. T F 11. Statutory law results from the independent decisions of the state and federal courts.
T F 12. An authoritative statement of the common law of the United States can be found in the Restatements of Law. 4 Chapter 1
KEY TERMS–MATCHING EXERCISE: Select the term that best completes each statement below.
1. Federal Trade 7. Injunction 14. Equity Commission 8. Maxims 15. Stare decisis 2. Federal statutes 9. Money damages 16. Uniform Probate Code 3. Uniform Commercial Code 10. U.S. Constitution 17. Administrative law
4. Crime 11. Tort law 18. Executive order
5. Substantive law 12. Restatements of Law 19. Rescission
6. Procedural law 13. Legal sanctions 20. Treaty
____ 1. A public wrong committed against society or the state.
____ 2. The law that establishes rules for enforcing rights.
____ 3. The remedy obtainable from a court of law for a civil lawsuit.
____ 4. A guiding principle whereby a court follows previous decisions in deciding the present case before it.
____ 5. A system of judicial relief that developed because of a lack of a proper remedy from the common law system.
____ 6. One type of remedy available only in a court of equity requiring a party to refrain from doing a specific act.
____ 7. The means by which the law enforces judgments.
____ 8. The supreme law of the land.
____ 9. The law that governs commercial transactions in most states.
____ 10. The law that defines, creates, and regulates legal rights and duties.
____ 11. An agreement between or among independent nations.
____ 12. General legal principles formulated by equity courts.
____ 13. Legislative laws passed by the Federal government.
____ 14. A governor of a state may issue this source of law. Introduction to Law 5
____ 15. A remedy in equity in which a party is allowed to invalidate a contract.
MULTIPLE CHOICE: Select the alternative that best completes each statement below.
____ 1. Equitable remedies include (a) specific performance (b) rescission (c) reformation (d) all of the above.
____ 2. Federal Court decisions are not found in which of the following? (a) Federal Re- porter (b) Lawyers Edition (c) Federal Supplement (d) North Western Reporter.
____ 3. Of the following, the one with present authority over commercial transactions is the (a) Uniform Commercial Code (b) Uniform Sales Act (c) Uniform Bills of Lading Act (d) Bulk Sales Act.
____ 4. Which of the following is most accurate? (a) All states have adopted the Uniform Commercial Code (b) The majority of states have adopted the Uniform Commercial Code (c) Only one state has not adopted the entire Uniform Commercial Code (d) All the statements are false.
____ 5. An example of a legal sanction for a criminal conviction is (a) a fine (b) capital punishment (c) imprisonment (d) all of the above.
____ 6. The branch of public law that deals with regulatory functions of the government as performed and supervised by public officials or commissions is (a) judicial law (b) legislative law (c) administrative law (d) none of the above.
____ 7. Which of the following is not a "maxim" of equity? (a) Equity will not suffer a wrong to be without a remedy. (b) He who comes into equity must come with clean hands. (c) He who seeks equity must do equity. (d) Equity favors a forfeiture.
____ 8. Law can best be classified into categories as (a) procedural or substantive (b) public or private (c) civil or criminal (d) all of the above.
____ 9. That law that deals with the rights and powers of the government is (a) private law (b) public law (c) administrative law (d) tort law.
____ 10. A source of law in our American legal system includes (a) the Federal Constitution (b) court decisions (c) municipal ordinances (d) all of the above.
____ 11. Torts and contracts are examples of (a) private law (b) public law (c) criminal law (d) all of the above.
____ 12. A remedy in equity in which a party to a contract is required to perform her obliga- tions according to the contract is (a) an injunction (b) specific performance (c) ref- ormation (d) rescission. 6 Chapter 1
____ 13. Public law consists of (a) administrative law (b) constitutional law (c) criminal law (d) all of the above.
CASE PROBLEMS–SHORT ESSAY ANSWERS: Read each case problem carefully. When appropriate, answer by stating a Decision for the case and by explaining the rationale–Rule of Law–relied upon to support your decision.
1. Sarah is in her first year of law school. The teaching method used at the school is the "case method" in which the students read and analyze the reports of court decisions or "cases." One such case is Brown v. Board of Education of Topeka, 347 U.S. 686, 74 S. Ct. 686 (1954). Explain to Sarah how to find this case in a law library.
Decision: ______
Rule of Law: ______
2. Harold signs a contract to buy Maude's home. Although he has the funds, Harold breaches the contract. Maude sues, asking for the remedy of specific performance. Harold demands a jury trial. Is he entitled to one? Explain.
Decision: ______
Rule of Law: ______
3. Nathanial Horn was walking along the street when he was arrested and booked for arson. At his trial, the state brought evidence showing that Horn was indeed in the immediate area when the fire purportedly began. Has the state proven its case against Horn?
Decision: ______
Rule of Law: ______
4. Anita wins a civil suit against Baker for damages of $10,000. Two questions: Would this case be an example of an “action at law” or a “suit in equity”? Could Anita have a right to a jury trial? Introduction to Law 7
Decision: ______
Rule of Law: ______
5. John Powers, one of the best-known swimmers in America, was walking near a river one day when he saw Mollie drowning. John, who was wearing a brand new shirt, didn't feel like getting wet. Would the State have a criminal action against John for not attempting to rescue Mollie? Explain.
Decision: ______
Rule of Law: ______