Chapter 1: Class Notes 29/08/2008 11:23:00

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← Basic Functions of Law
• Dispute resolution
o May be criminal or non-criminal
• Protection of property
o Protect property ownership and assist in making of voluntary agreements-
contracts- regarding exchanges of property and services.
• Preservation of the state
o Ensures political change is brought about by elections legislation and
referenda rather than revolution, sedition and rebellion
← Law and Morals
• Some law and morals overlap (“thou shall not kill”)
o It is morally wrong to take another’s life, and it is punishable by law to do
so as well
• Some laws have nothing to do with morals
o You must drive on the right side of the road
• Some moral issues are not defined legally
o You should not stand by and watch a blind man walk off a cliff, but it is not
punishable by law to do so
← Law and Justice
• Without law, there can be no justice
• Justice is defined as the fair, equitable and impartial treatment of the competing
interests and desires of individuals and groups with due regard for the common
good.
• Law does not guarantee justice
o Totalitarian societies form laws to supplement their own wrongdoings
(Nazi Germany)
← Classification of Law
• A right is the capacity of a person, with the aid of the law, to require another
person to perform or to refrain from performing a certain act
• A duty is the obligation the law imposes upon a person to perform or to refrain
from performing a certain act
• No right can rest upon one person without a corresponding duty to rest upon
another person
• Substantive and Procedural
 o Substantive law creates, defines, and regulates legal rights and duties
 Ex: rules of contract law
o Procedural law sets forth the rules for enforcing those rights that exist by
reason of the substantive law
 Ex: defines the method by which to obtain a remedy in court
• Public and Private
o Public law is the branch of substantive law that deals with the governments
rights and powers and its relationship to individuals or groups
 Consists of constitutional, administrative and criminal law
o Private law is that part of substantive law governing individuals and legal
entities in their relationship with one another
 Business law is primarily private law
← Sources/Types of Law
• US Constitution
o Sets up the structure for and grants power to the government
 Determines how it is organized, and the relationship between federal
gov’t and state
 Creates three separate branches of government
 Executive- power to enforce the law
• Prosecutorial discretion- laws that are not enforced
 Judicial- interpret the law, judicial review
• Can determine laws to be unconstitutional
 Legislative- power to create law
• Can override executive veto with 2/3 vote
o Limits the power of the government
 Right to bear arms, right to vote, right to due process, freedom of
expression, freedom of religion, freedom of speech, equal protection
 Right can not be restricted unless government has a compelling
reason to do so
o Applies in no way to private entity, only to state entity
• Legislative Law (Statutes)
o Laws passed by the legislative body
o Civil rights act of 1964 prohibits discrimination in the workplace
 Example, if a private company fires female workers based on gender
discrimination, the plaintiff (fired worker) cannot sue based on
unconstitutionality.
 She can sue based on statutes (Civil Rights Act of 1964)
o Deal with illegal acts within private entities

o Civil vs. Criminal

 Civil law defines duties, the violation of which constitutes a wrong
against the party injured by the violation
 Part of private law
 Aggrieved individual sues to commence action
 Purpose is to compensate the injured party and deterrence
 In a civil action the injured party (plaintiff)sues to recover
compensation for the damage and the injury sustained as a
result of the defendants wrongful conduct
 The plaintiff has the burden of proof, which he/she must
sustain by a preponderance (greater weight) of the evidence
 Criminal law establishes duties, the violation of which is a wrong
against the whole community
 Part of public law
 Government prosecutes to commence action
 Purpose is to punish the wrongdoer, deterrence, rehabilitation
and preservation of peace
 Criminal guilt must be proven beyond a reasonable doubt-
higher burden of proof than required in civil court
o Uniform Acts
 Uniform Commercial Code (UCC)
 Developed to create greater uniformity, after states enacted
their own statutes hampering the conduct of commerce on a
national scale
 Article 2- Contracts (K) for the sale of goods
• Applies to any contract for the sale of goods
• Not necessarily commercial transactions
o Courts can choose which issues they’d like to address in legislative law, unlike
adversary system of judiciary law
o Treaties
 An agreement between or among independent nations
 May be entered into only by the federal government, not the states
  Has the legal force of a federal statute when signed by president and
approved by the senate
o Executive Orders
 Laws issued by the president of the US
 May amend, revoke or supersede a prior executive order
 Ex: President Johnson in 1965 prohibit discrimination by federal
contractors on the basis of race, color, sex, religion, or national
origin in employment
• Judicial Law (Common Law)
o Law that judges make and apply in situations where there is no statute

o Applies to contracts for real estate and services

o “Stare Decisis”- let the decision stand

 must follow precedents (prior decisions by higher courts)
o US operates on common law system
 Relies heavily on the judiciary as the source of law and on the
adversary system for settling disputes
 adversary system- the parties, not the court, must initiate
and conduct litigation
o civil law systems- contrast common law system
 depend on comprehensive legislative enactments and an inquisitorial
system of determining disputes
 inquisitorial system- the judiciary initiates litigation, investigates
pertinent facts, and conducts the presentation of the evidence
 in most of Europe, Scotland, Louisiana, Quebec, Latin America, and
Africa and Asia
o common law, aka case law or judge-made law
 courts have developed a body of law that serves as precedent for
determining later controversies.
 Judicial decisions, under stare decisis, determine with finality the
case currently being decided and indicate how the court will decide
similar cases in the future
o Equity
 A new and supplementary system of needed judicial relief for those
who could not receive adequate remedies through the common law
 Difference between common law and equity
 The chancellor (presided over the court of chancery that
administered equity) could issue a decree, or order,
compelling a defendant to do, or refrain from doing, a
specified act.
 If the defendant did not obey, could be held in contempt of the
court and punished by imprisonment
  Some cases, recognized rights that were enforceable at common law,
but they provided more effective remedies.
 Ex: in a court of equity, for breach of land contract the buyer
could obtain a decree of specific performance commanding
the defendant seller to perform his part of the contract by
transferring title to the land.
 injunction- a court order requiring a party to do or refrain
from doing a specified act
 reformation- upon the ground of mutual mistake, an action
could be brought to reform or change the language of a
written agreement to conform to the actual intention of the
contracting parties.
 Rescission of a contract- allowed a party to invalidate a
contract under certain circumstances
 Remedies (decrees) were granted at court’s discretion, not according
to rights
 Discretion was exercised according to equitable maxims-
general legal principals and if remedy at law is inadequate
o Restatements of Law
American Law Institute (ALI)
 Composed of a distinguished group of lawyers, judges and
law teachers who set out to prepare “an orderly restatement
of the general common law of the US, including in that term
not only the law developed solely by judicial decision, but also
the law that has grown from the application by the courts of
statutes that were generally enacted and were in force for
many years”
 Since the common law consists of independent decisions of
states and federal courts, the ALI compile all the form a
restatement of the laws
 Restatements cover many areas of common law, including
torts, contracts, agency, property, and truss
 Restatements are not laws, but they are highly persuasive
and are used frequently by courts to support their opinion
• Administrative Law
o Often referred to as the fourth branch of the government

o The branch of public law that is created by administrative agencies in the

form of rules, regulations, orders, and decisions to carry out the regulatory
powers and duties of those agencies
o Concern general matters of public health, safety, and welfare, including the
establishment and maintenance of military forces, police, citizenship and
naturalization, taxation, environmental protection, and the regulation of
transportation, interstate highways, waterways, television, radio and trade
and commerce
 Ex: FCC, FDA, SEC, EPA
• Ordinances
o Within smaller bodies of government, localized issues
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 29/08/2008 11:23:00