Chapter 1
Legal Heritage and
Critical Legal Thinking
Co © 2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman
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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Definition of Law
• A body of rules of action
or conduct prescribed by
the controlling authority,
and having binding legal
force.
• That which must be
obeyed and followed by
citizens subject to
sanctions or legal
consequences.
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Functions of Law
•
•
•
•
•
•
•
Keeping the peace
Shaping moral standards
Promoting social justice
Maintaining the status quo
Facilitating orderly change
Facilitating planning
Providing a basis for
compromise
• Maximizing individual freedom
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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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Qualities of the Law
• 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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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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Jurisprudence:
The philosophy or
science of the law.
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Schools of Jurisprudential Thought
Natural Law
School
Historical
School
Analytical School
Sociological
School
Law and
Economics
School
Critical Legal
Studies School
Command
School
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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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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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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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History of American Law
• The English system of law
was generally adopted
• It became the foundation
from which American
judges developed our
common law
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English Common 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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English Common Law (continued)
• English common law cases
were decided by the:
– Law Court
• A uniform system of courts
emphasizing form over substance
• Granted only monetary damages
– Court of Chancery (equity
court )
• Sought when law courts could not
grant appropriate remedy
• Remedies were shaped to fit each
situation
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English Common Law (continued)
– Merchant Court
• Law Merchant rules based on
common trade practices and
trade
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Adoption of English Common Law
• U.S. courts usually permit
plaintiffs to seek both legal
and equitable orders and
remedies
• Merger of law, equity, and
merchant court systems
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The Civil Law System
• Romano-Germanic civil
law based on the Twelve
Tables and the Corpus Juris
Civilis
• Napoleonic Code
• German Civil Code
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The Civil Law System (continued)
• 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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In some civil law
countries, court
decisions do not
have the force of
law.
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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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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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Sources of Law in the United States
Constitutions
Codified Law
Treaties
Executive
Orders
Judicial
Decisions
Agency Rules
& Regulations
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Sources of Law in the United States
(continued)
• Constitutions
– The U.S. Constitution
• establishes the federal
government and enumerates
its powers
• Created three branches
– Legislative
– Executive
– Judicial
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Sources of Law in the United States
(continued)
– 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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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.
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Sources of Law in the United States
(continued)
• Codified law: Statutes and
ordinances
– The U.S. Congress enacts
federal statutes.
– State legislatures enact state
statutes.
– Ordinances are enacted by
municipalities and local
government agencies.
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Sources of Law in the United States
(continued)
• Executive orders
– Issued by the president and
state governors
– Power derived from express
delegation from legislative
branch
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Sources of Law in the United States
(continued)
• Regulations and Orders of
Administrative Agencies
– Administrative agencies are
created by the legislative and
executive branches of
government.
– They may adopt rules and
regulations and may enforce
and interpret statutes.
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Sources of Law in the United States
(continued)
• Judicial decisions
– Courts decide controversies.
– Judicial decisions usually state
the rationale used by the
court in reaching that
decision.
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The Doctrine of Stare Decisis
• Based on the common
law tradition, past court
decisions become
precedent for deciding
future cases.
• Lower courts follow the
precedent established by
higher courts.
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The Doctrine of Stare Decisis (continued)
• Both federal and state courts
follow the precedents
established by U.S. Supreme
Court decisions.
• Courts in one jurisdiction are
not bound by precedent of
another jurisdiction, but may
look at it for guidance .
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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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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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Critical Legal Thinking
• The process of:
– specifying the issue
presented by a case
– identifying the key facts in
the case and applicable law
– applying the law to the facts
– reaching a conclusion that
answers the issue presented
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Key Terms
• Plaintiff
• Defendant
The party
The party
who
against
originally
who the
brought the
lawsuit has
lawsuit.
been
brought.
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Key Terms (continued)
• Petitioner or Appellant
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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