Lesson One

Welcome to Business Law I!!!!!

Hi gang! We’re going to learn a lot of pretty neat information over the course of the next several weeks. All I ask is that you contact me frequently at the email addresses ( I have 3) that have been posted in the instructor's posting area of the discussion group and stay current with the readings, in addition to completing the homework and taking both the midterm and final. Not too much, right? Yeah, right…

The notes should supplement the chapters in great detail. Yes, purchase the book, because many of the homework assignments -let alone test examples- will come from the text. Now let’s get started with our first lesson….

The term “law” really is a societal construct in that it has different meanings, interpretations, and ramifications depending upon the society or even the jurisdiction (area under a certain legal influence such as Barstow, San Bernardino County, Kern County) that has some restrictive power over its own population. Law pretty much acts as the arbiter in protecting societies’ “morality”; this concept of right v. wrong and “do unto others” must function in order to have a moral society. Without law we have no morality; with no morality we have chaos (we can’t just do as we please…), with chaos we have anarchy…(hey, guess what? If we keep going with this sequence we’ll come up with Afghanistan!)

All kidding aside, (for the moment) a complete definition of law would be a system of rules and regulations put forth in order to keep an orderly society.

We can categorize laws as having public, private, and preventative characteristics.

The “Public” characteristic creates laws protecting against behavior society would find objectionable. Examples of these kinds of laws would include “[not] spitting on the sidewalk,” or zoning restrictions not allowing a “type of after hours club” near residential areas (in Los Angeles we call these clubs “Rhinos” named after a type of candy…I think you know what I mean). In essence, the public characteristic of law attempts to regulate the activities of the citizenry (us) in relationship to what our neighbors might find objectionable. Public law involves criminal, constitutional, labor law, and securities litigation (to name just a few).

The “Private” aspect of  law deals with relationships we have with individuals. The purpose of private law is to compensate the “injured” party for damages inflicted by another. You may have heard the term to “make one whole,” well it’s to give back what has been taken. Tort law, agency, property, and contract law all involve the “private” concept of law.

The “Prevention” attribute of law concerns ending disputes. Usually contract law falls under this heading, but most real estate transactions allude to the rights of both parties (buyer and seller) thus in law we have remedies that will prevent one party from taking advantage of another.

Let’s look at history for a moment to give us an idea of the roles played by Civil, Common, and Equity law in the United States.

“Civil Law” is known as “code law” and was highly used in the ancient world. Codes were used by societies -such as the Babylonians, Greeks, and Romans- as a means of systematizing rules and regulation. For instance, the term “an eye-for-an-eye, a tooth-for-a-tooth” comes to us from the Hammurabic code of laws circa 1790 B.C. Cases were not tried before judges (that came later) but before tribunals that would render a verdict on the defendant’s behalf.

Civil Law is still used in the modern world. Countries such as Germany, Spain, and France all have civil law codes acting as the basis for their legal systems. The state of Louisiana, because it originally belonged to France, still enforces the Napoleonic Code, a form of civil law which governs jury trial and selection, and rules governing equality (like community property…thanks Napoleon…that’s from all us “married guys”) Also, the term used in our society known as the “penal code” has its roots in civil law.

 So…civil law is AN ATTEMPT TO ESTABLISH A BODY OF LEGAL RULES IN ONE SYSTEMIZED CODE.  

Well, merry old England did not follow the “Roman-Napoleonic” concept of law so the English adopted something known as “Common Law,” whereas cases were decided based on previous decisions rendered in like cases. Since England never had a constitution they used common law decisions as the basis for their rights and protections. The English “Magna Carta (known as the Great Charter) (1215) acted as the basis for the rights of Englishmen in relationship to society. In other words, what was decided upon before became the legal precedent (similar to how our courts settle most cases) for the case before the court. We sometimes refer to this as “case law.”

Now, you’re probably wondering “what if this never took place before? How were judgments rendered, and what about today?” Courts would make decisions based on the concept of “stare decisis” which means “stand by the decision.” Through the application of stare decisis it was hoped something in common law would hold a precedent in the case heard before the court. If no previous case law existed, the court had to use its own judgment…and that’s what our system does today: looks for previous decisions rendered under like circumstances.

Under what we refer to as the concept of “equity” specific performance on contracts, injunctions (when we are told to abide by a court order, or to desist from performing an act-stop doing it), and contract modifications all come under the court of “equity.” The roots of equity originate with the Norman invasion of England in 1066. William the Conqueror (the really big Norman who wanted to invade in the first place) had not studied English Common Law nor was he fluent in Roman Civil Law. Consequently, he based his system-the equity system-on one of “fair play” embodied in the rules of common sense justice. Eventually equity became the part of the general legal system in issues governing divorce, annulment of marriages (which were previously decided by the Catholic Church), and adoption.     

Discussion and Homework Assignment

The instructor will post the assigned homework in the Instructor's Posting Area and the discussion question on the weekly discussion board thread. You must complete both the homework assignment and the discussion question each week in order to pass the course.