1. Chapter 1 Legal, Business, and E-Commerce Environment

2. What is law?
The law consists of rules that regulate the conduct of individuals, businesses, and other organizations within society.
It is intended to protect persons and their property from unwanted interference from others. The law forbids persons from engaging in certain undesirable activities.
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3. Definition of Law
That which must be obeyed and followed by citizens subject to sanctions or legal consequences.
A body of rules of action or conduct prescribed by controlling authority, and having binding legal force.
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4. Functions of Law Keeping the peace Shaping moral standards
Including making certain activities crimes
Shaping moral standards
e.g., enacting laws that discourage drug and alcohol abuse
Promoting social justice
e.g., enacting statutes that prohibit discrimination in employment
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5. Functions of Law (continued)
Maintaining the status quo
e.g., passing laws preventing the forceful overthrow of the government
Facilitating orderly change
e.g., passing statutes only after considerable study, debate, and public input
Providing a basis for compromise
e.g., approximately 90 percent of all lawsuits are settled prior to trial
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6. Functions of Law (continued)
Facilitating planning
e.g., well-designed commercial laws allow businesses to plan their activities, allocate their resources, and assess their risks
Maximizing individual freedom
e.g., the rights of freedom of speech, religion, and association granted by the First Amendment to the U.S. Constitution
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7. Qualities of the Law Fairness Flexibility
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8. Qualities of the Law (continued)
Fairness of the Law
The American legal system is one of the most comprehensive, fair, and democratic systems of law ever developed and enforced.
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9. Qualities of the Law (continued)
Flexibility of the Law
U.S. law evolves and changes along with the norms of society, technology, and the growth and expansion of commerce in the United States and the world.
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10. The philosophy or science of the law.
Jurisprudence:
The philosophy or science of the law.
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11. Schools of Jurisprudential Thought
Natural Law School
Historical School
Analytical School
Sociological School
Command School
Law and Economics School
Critical Legal Studies School
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12. Schools of Jurisprudential Thought (continued)
Natural Law School
Postulates that law is based on what is “correct”.
Law should be based on morality and ethics.
Historical School
Believes that law is an aggregate of social traditions and customs.
Analytical School
Maintains that law is shaped by logic.
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13. Schools of Jurisprudential Thought (continued)
Sociological School
Asserts that law is a means of achieving and advancing certain sociological goals.
Command School
Believes that law is a set of rules developed, communicated, and enforced by the ruling party.
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14. Schools of Jurisprudential Thought (continued)
Critical Legal Studies School
Maintains that legal rules are unnecessary and that legal disputes should be solved by applying arbitrary rules based on fairness.
Law and Economics School
Believes that promoting market efficiency should be the central concern of legal decision making.
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15. History of American Law
When the American colonies were first settled, the English system of law was generally adopted as the system of jurisprudence.
This was the foundation from which American judges developed a common law in America.
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16. English Common Law
Law developed by judges who issued their opinions when deciding a case.
The principles announced in these cases became precedent for later judges deciding similar cases.
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17. English Common Law (continued)
The English common law can be divided into cases decided by the:
Law courts
Equity courts (Court of Chancery)
Merchant courts
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18. The Civil Law System
The Civil Code and parliamentary statutes that expand and interpret it are the sole sources of law in most civil law countries.
The adjudication of a case is simply the application of the code or the statutes to a particular set of facts.
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19. In some civil law countries, court decisions do not have the force of law.
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20. Adoption of English Common Law in America
All the states except Louisiana base their legal systems on the English common law.
Louisiana bases its law on the civil law.
Influence of its French heritage
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21. Adoption of English Common Law in America (continued)
In the U.S., the law, equity, and merchant courts have been merged.
Most U.S. courts permit the aggrieved party to seek both law and equitable orders and remedies.
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22. Sources of Law in the United States
Constitutions
Codified Law
Treaties
Executive Orders
Agency Rules & Regulations
Judicial Decisions
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23. Sources of Law in the United States (continued)
Constitutions
The U.S. Constitution establishes the federal government and enumerates its powers.
Powers not given to the federal government are reserved to the states.
State constitutions establish state governments and enumerate their powers.
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24. Sources of Law in the United States (continued)
Codified law: Statutes and ordinances
Statutes are enacted by Congress and state legislatures.
Ordinances are enacted by municipalities and local government agencies.
They establish courses of conduct that must be followed by covered parties.
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25. Sources of Law in the United States (continued)
Treaties
The president, with the advice and consent of the Senate, may enter into treaties with foreign governments.
Executive orders
Issued by the president and governors of states.
They regulate the conduct of covered parties.
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26. Sources of Law in the United States (continued)
Administrative agency rules and regulations
Administrative agencies are created by the legislative and executive branches of government.
They may adopt rules and regulations that regulate the conduct of covered parties.
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27. Sources of Law in the United States (continued)
Judicial decisions
Courts decide controversies.
In doing so, a court issues decisions that state the holding of the case and the rationale used by the court in reaching that decision.
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28. The Doctrine of Stare Decisis
Based on the common law tradition, past court decisions become precedent for deciding future cases.
Lower courts must follow the precedent established by higher courts.
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29. The Doctrine of Stare Decisis (continued)
Thus, all federal and state courts in the U.S. must follow the precedents established by U.S. Supreme Court decisions.
Adherence to precedent is called stare decisis.
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30. Priority of Law in the United States
The U.S. Constitution and treaties take precedence over all other laws.
Federal statutes take precedence over federal regulations.
Valid federal law takes precedence over conflicting state or local law.
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31. Priority of Law in the United States (continued)
State constitutions rank as the highest state law.
State statutes take precedence over state regulations.
Valid state law takes precedence over local laws.
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32. Critical Legal Thinking
The process of:
specifying the issue presented by a case,
identifying the key facts in the case and applicable law, and then
applying the law to the facts to come to a conclusion that answers the issue presented.
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33. Key Terms Plaintiff Defendant
The party who originally brought the lawsuit.
Defendant
The party against who the lawsuit has been brought.
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34. Key Terms (continued) Petitioner or Appellant Respondent or Appellee
The party who has appealed the decision of the trial court or lower court.
Respondent or Appellee
The party who must answer the petitioner’s appeal.
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