1. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 1 Chapter 1: Introduction to Law and Legal Reasoning Jentz Miller Cross BUSINESS LAW Alternate Edition 11 th Ed.

2. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 2 §1: Schools of Jurisprudential Thought  Natural Law view.  Positivist view.  Historical view.  Legal Realism view.

3. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 3 The Natural Law School  Assumes that law, rights and ethics are based on universal moral principals inherent in nature discoverable through the human reason.  The oldest view of jurisprudence dating back to Aristotle.  The Declaration assumes natural law, or what Jefferson called “the Laws of Nature.”

4. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 4 Natural Law: Rev. Martin Luther King, Jr. Letter from the Birmingham Jail, April 16, 1963. “[T]here are two types of laws: just and unjust laws.... A just law is a man- made code that squares with the moral law.... An unjust law is a code that is out of harmony with the moral law.... An unjust law is a human law that is not rooted in eternal and natural law.” Letter from the Birmingham Jail, April 16, 1963. “[T]here are two types of laws: just and unjust laws.... A just law is a man- made code that squares with the moral law.... An unjust law is a code that is out of harmony with the moral law.... An unjust law is a human law that is not rooted in eternal and natural law.”

5. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 5 The Positivist School  Law is the supreme will of the State that applies only to the citizens of that nation at that time.  Law, and therefore rights and ethics, are not universal. The morality of a law, or whether the law is “bad or good,” is irrelevant.

6. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 6 The Historical School  Emphasizes the evolutionary process of law.  Concentrates on the origins of the legal system.  Law derives its legitimacy and authority from standards that have withstood the test of time.  Follows decisions of earlier cases.

7. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 7 Legal Realism  Jurisprudence that holds law is not simply a result of the written law, but a product of the views of judicial decision makers, as well as social,economic, and contextual influences.

8. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 8 § 2: Business Activities and the Legal Environment  Law regulates many different areas of business.  Study of business law also involves a knowledge of ethics in decision-making.  Many different laws may affect a single business transaction.

9. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 9 §3: Sources of American Law  U.S. and State Constitutions.  Statutory Law—federal, state and local.  Administrative regulations and decisions.  Case Law and Common Law Doctrines.

10. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 10 §4: The Common Law Tradition  American law is based largely on English Common Law which was based largely on traditions, social customs, rules, and cases developed over hundreds of years.

11. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 11 The Common Law Tradition [2]  At common law, there were two separate court systems with two different types of remedies: –COURTS OF LAW (monetary relief), and –COURTS OF EQUITY (non-monetary relief) based on “notions of justice and fair dealing.”

12. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 12 Courts of Law  Also called “king’s courts” where judges were appointed by the king.  Remedies limited to those provided at law, i.e., land, chattel, money.  Judges resolved disputes by application of rules of law to the facts of the case before the court.

13. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 13 Courts of Equity  Also called courts of chancery in Delaware.  Equitable relief was sometimes available in instances where a strict application of the law to the facts of the case compelled a result that was legal but unjust.  Equitable Maxims.

14. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 14 Legal and Equitable Remedies Today  Today federal and state courts of general jurisdiction have consolidated remedies at law and remedies at equity.  Generally, the same court can fashion a remedy that includes both damages and equitable or injunctive relief.

15. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 15 Stare Decisis Stare decisis is a Latin phrase meaning “to stand on decided cases.” Stare decisis is a Latin phrase meaning “to stand on decided cases.” –Makes the law stable and predictable. –Increases judicial efficiency by relieving courts of having to reinvent legal principles for each case brought before them.

16. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 16 Stare Decisis and Precedent  Stare decisis is “judge made law” based on precedent.  Precedents are judicial decisions that give rise to legal principles that can be applied in future cases based upon similar facts.  Precedents and other forms of positive law, such as statutes, constitutions, and regulations, are referred to as binding authority and must be followed.

17. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 17 Departures from Precedent In cases of “first impression” where there is no precedent, the court may refer to positive law, public policy, and widely held social values in order to craft the best new precedent. In cases of “first impression” where there is no precedent, the court may refer to positive law, public policy, and widely held social values in order to craft the best new precedent.

18. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 18 Stare Decisis and Legal Reasoning  Method used by judges to reach a decision.  Many courts and attorneys frame decisions and briefs using the IRAC format: –Issue (What is the question to be resolved?) –Rule (What law governs this matter?) –Application (Apply the law to the facts) –Conclusion (Decision or Verdict)

19. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 19 Forms of Legal Reasoning  Deductive Reasoning: Makes use of syllogism, a type of logical relationship involving a major premise and a minor premise.  Linear Reasoning: Proceeds from point to point, with the final point being the conclusion.  Reasoning by Analogy: Analysis that compares facts of present case with facts of similar previously-decided cases.

20. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 20 § 5: The Common Law Today  Common law today governs transactions not covered by statutory law.  Restatements of the Law: –American Law Institute. –Summarize the common law of most states.

21. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 21 §6: Classifications of Law Every type of law will be either: Every type of law will be either: –Civil or Criminal, and either –Substantive or Procedural, and either –Public or Private.

22. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 22 Civil vs. Criminal  Civil law defines the rights between individuals or individuals and governments.  Criminal law defines an individual’s obligations to society as a whole.

23. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 23 Substantive vs. Procedural  Substantive law defines or creates the rights and obligations of persons and governments.  Procedural law provides the steps one must follow in order to avail oneself of one’s legal rights or enforce another’s legal obligations.

24. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 24CyberLaw  Not really a new type of law.  Traditional legal rules applied to online transactions.  Applies to advertising, contracting, banking, filing documents with courts, employment relations and other transactions.

25. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 25 §7: Finding Primary Sources of Law  Finding Statutory Law. –United States Code (USC). –http://uscode.house.gov/search/criteria.shtml –State Statutes.  Finding Administrative Law. –Code of Federal Regulations (CFR). –http://www.access.gpo.gov/nara/cfr/cfr-table-search.html  Finding Case Law (at Findlaw.com). –Supreme Court: http://www.findlaw.com/casecode/supreme.html –Federal Courts: http://www.findlaw.com/casecode/courts/index.html –State Courts: http://www.findlaw.com/11stategov/index.html

26. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 26 §8: How to Read & Understand Case Law  Legal cases are identified by a “legal citation” (or a “cite”) as the example below: Berger v. City of Seattle, 512 F.3d.582 (9 th Cir. 2008). Title: First Party is Plaintiff, second party is Defendant. The parties are either italicized or underlined.

27. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 27 §8: How to Read & Understand Case Law  Legal cases are identified by a “legal citation” (or a “cite”) as the example below: Berger v. City of Seattle, 512 F.3d.582 (9 th Cir. 2008). The case is found in the Federal 3 rd Reporter, Volume 512, page 582.

28. Copyright © 2009 South-Western Legal Studies in Business, a part of South-Western Cengage Learning. 28 §8: How to Read & Understand Case Law  Legal cases are identified by a “legal citation” (or a “cite”) as the example below: Berger v. City of Seattle, 512 F.3d.582 (9 th Cir. 2008). The case was decided by the Ninth Circuit Federal Court of Appeals in 2008.