1 CHAPTER Laws and Their Ethical Foundation 1

1 CHAPTER Laws and Their Ethical Foundation 1 -1 Laws and Legal Systems 1 -2 Types of Laws 1 -3 Ethical Bases for Laws Law for Business and Personal Use © Thomson South-Western

1 -1 Laws and Legal Systems GOALS n Explain the stages in the growth of law n Describe the differences between common law and positive law n Identify the origin of the U. S. legal system Chapter 1 Slide 2 Law for Business and Personal Use © Thomson South-Western

FOCUS n What is law? n Why do societies need laws and courts? n Societies need laws to protect individuals and to settle disputes between individuals. Courts are needed to settle disputes, award damages, and prevent or punish wrongs. Chapter 1 Slide 3 Law for Business and Personal Use © Thomson South-Western

WHAT IS LAW? n Laws n Enforceable rules of conduct in a society, reflect the cultural and circumstances that create them. n Laws may be organized into an organized code called a code n Stages in the growth of law n Individuals take revenge for wrongs done to them (personal revenge) n Gang wars in the inner cities often result from this type of attitude n A powerful leader or other form of central authority substitutes an award of money or goods for revenge n Powerful leader or authority-sovereign n The leader or authority gives power to a system of courts n Elders and priests generally override these courts n The leader or central authority acts to prevent and punish wrongs n The sovereign enforces a set of laws and matching punishments Chapter 1 Slide 4 Law for Business and Personal Use © Thomson South-Western

Common law versus positive law n Common law: The laws are based on customs of the people n Precedent- the courts use prior cases as a guide for deciding similar new cases n Positive law: The laws are handed down by the central authority n World Map Chapter 1 Slide 5 Law for Business and Personal Use © Thomson South-Western

How does common law differ from positive law? • Common Law is based on current standards or customs among the people. Positive Law is dictated from above by a central authority Chapter 1 Slide 6 Law for Business and Personal Use © Thomson South-Western

WHAT IS THE ORIGIN OF THE U. S. LEGAL SYSTEM? n English common law n King’s Bench n Court appointed by King Henry II n Appointed a number of judges from a group of trusted nobles n Jurisdiction- The power to decide a case n Jury- Citizens chosen from each region to help interpret that region’s customs for the court. n Unique to the English Common Law system n An example- Pg. 7 n Advantages of English common law n Achieves uniformity while maintaining an ability to adapt to changes in society. n Equity: An alternative to common law (pg. 8 -9) Chapter 1 Slide 7 Law for Business and Personal Use © Thomson South-Western

On which early legal system is the U. S. legal system based? • The U. S legal system is based on English common law. Chapter 1 Slide 8 Law for Business and Personal Use © Thomson South-Western

1 -2 Types of Laws GOALS n Identify the four sources of law n Discuss how to resolve conflicts between different sources of laws n Compare and contrast criminal and civil law, and substantive and procedural law Chapter 1 Slide 9 Law for Business and Personal Use © Thomson South-Western

FOCUS n Make a list of rules the school enforces. n Make a second list of rules you must live by in your families. n How do these rules affect your life? n Which rules would you like to change? Why? n How would the changes affect you, your family, or school? Chapter 1 Slide 10 Law for Business and Personal Use © Thomson South-Western

WHAT ARE THE SOURCES OF LAW? n Constitutions- Supreme Law of the land n Document that sets forth the framework of a government and its relationship to the people it governs n Statutes n Laws enacted by legislative branches of state and U. S. governments. n Case law n Created by the judicial branch of government n Made from court decisions in actual cases n Administrative regulations n Governmental bodies created by federal, state, and local legislatures to carry out particular laws. n Legislative branch delegates power to agencies Chapter 1 Slide 11 Law for Business and Personal Use © Thomson South-Western

Sources of Law: Constitutions allocate power: n Allocation of Power Between People and Their Governments n n n Allocation of Power Between Federal and State Governments n n The federal constitution is the main instrument for allocating powers between people and their government. Does this with the first ten amendments called the Bill of Rights- Protects people from actions of their government The constitution gives the federal government the power to regulate both foreign and interstate commerce Interstate Commerce- occurs between two or more states Intrastate Commerce- occurs within one state-the power to regulate is left with that state Allocation of Power Among the Branches of Government n n n Executive, Legislative, and Judicial Created to create a system of checks and balances between branches of government Ensures that no branch of government becomes too powerful. Chapter 1 Slide 12 Law for Business and Personal Use © Thomson South-Western

Sources of Law: Statutes n Statutes- Laws enacted by legislatures. n The federal constitution created the Congress of the U. S. n State constitutions created the state legislatures n States delegate legislative authority to local government n Ordinances- Legislation enacted at the local level. n Only effective within the boundary of the local government that enacted them Chapter 1 Slide 13 Law for Business and Personal Use © Thomson South-Western

Sources of Law: Case Law n Law made after a trial has ended and one of the parties has appealed the result to a higher court. n Stare decisis- The legal doctrine that requires lower courts to follow established case law in deciding similar cases (“to adhere to decided cases”). n Latin for “let the decision stand” Chapter 1 Slide 14 Law for Business and Personal Use © Thomson South-Western

Sources of Law: Administrative Regulations n Governmental bodies created by federal, state, and local legislatures to carry out particular laws. n Controlled by the Executive Branch of government n Examples: Federal Social Security Administration, States division of Motor Vehicles, and County’s Zoning Division Chapter 1 Slide 15 Law for Business and Personal Use © Thomson South-Western

What are the four sources of law? n. Constitutions n. Statutes n. Case law n. Administrative regulations Chapter 1 Slide 16 Law for Business and Personal Use © Thomson South-Western

WHAT HAPPENS WHEN LAWS CONFLICT? n Constitutions and validity n Constitutions are the highest source of law- “Supreme Law of the Land” n When any type of law is declared invalid by a state or federal court because it conflicts with a constitution it is said to be unconstitutional n Statutes and validity n Statutes or ordinances must be constitutional and valid n Administrative regulations and validity n Courts may invalidate a rule or regulation if it is outside the scope of powers delegated to the agency by the legislature that created it. n Case law and validity n A legislative body has the power to nullify a courts interpretation of a statue or ordinance by rewriting the statute. Chapter 1 Slide 17 Law for Business and Personal Use © Thomson South-Western

Which source of law in the United States is the highest authority? n Constitution Chapter 1 Slide 18 Law for Business and Personal Use © Thomson South-Western

WHAT ARE THE MAINTYPES OF LAWS? n Civil and criminal laws n Civil Law- The group of laws that make up for wrongs against individual persons. n When the private legal rights of an individual are violated, the matter if governed by civil law n Private wrongs (civil offenses) against people or organizations are referred to as Torts n Crime-an offense against society rather than individuals- n When a citizen’s right to live in peace is violates by a crime it is governed as a Criminal law. Chapter 1 Slide 19 Law for Business and Personal Use © Thomson South-Western

WHAT ARE THE MAINTYPES OF LAWS? n n Procedural and substantive laws Procedural Law- Deals with methods of enforcing legal rights and duties n n Two Types of Procedural Law n n n Define offenses such as Murder, Theft, Breach of Contract and Negligence Business law n n n Criminal Procedure-defines the process for enforcing the law when someone is charged with a crime Civil Procedure-used when a civil law has been violated. Only concerned with private offenses. Substantive Law- Laws defining rights and duties of conduct except those involved in enforcement. n n Determine whether equitable remedies, such as injunction (stops something from being done) are available Covers rules that apply to business situations and transactions. Mainly concerned with civil law, especially contracts Uniform business laws n Uniform Commercial Code (UCC)- a widely adopted uniform business law. n Governs sales of goods, certain aspects of banking, and leases of goods. Chapter 1 Slide 20 Law for Business and Personal Use © Thomson South-Western

Compare and contrast criminal and civil law and substantive and procedural law. Chapter 1 Slide 21 Law for Business and Personal Use © Thomson South-Western

TYPES OF LAW Constitutional law Based on constitutions Statutes Enacted by legislative bodies Administrative law Rulings by administrative agencies Civil law Addresses wrongs done to individuals Criminal law Addresses wrongs done to society Procedural law Deals with methods of enforcing legal rights and duties Substantive law Defines legal rights and duties Business law Rules that apply to business transactions Chapter 1 Slide 22 Law for Business and Personal Use © Thomson South-Western

1 -3 Ethical Bases for Laws GOALS n Define ethics n Compare and contrast ethics based on consequences with ethics based on systems of rules n Discuss ways in which ethics are reflected in laws Chapter 1 Slide 23 Law for Business and Personal Use © Thomson South-Western

FOCUS n What does ethics mean? n Business Ethics Chapter 1 Slide 24 Law for Business and Personal Use © Thomson South-Western

ETHICS AND THE LAW n Ethics-A practice of deciding what is right or wrong in a reasoned, impartial manner n To involve ethics a decision must affect you or others significant way n In addition to being reasonable ethical decisions should be impartial n Impartiality-The idea that the same ethical standards are applied to everyone n Business Ethics-the ethical principles used in making business decisions Chapter 1 Slide 25 Law for Business and Personal Use © Thomson South-Western

ETHICS AND THE LAW n Basic forms of ethical reasoning n Consequences-based ethical reasoning n The rightness or wrongness is based on only the results of the action n First looks at alternative ways to alter the current situation n Second attempts to forecast the consequences that will arise from each alternative n Finally it evaluates those possible consequences to select the alternative that will generate the greatest good. n n The standard for judging comes from two sources: n n Rule-based ethical reasoning n Acts are either right or wrong A recognized authority (religious source) clearly prescribes what is correct by the time tested rules such as the Ten Commandments Human reasoning Universality-picturing everyone doing the action then asking yourself, “Would the result be irrational, illogical, or demeaning? ” yes=ethically wrong Ethics reflected in laws n Integrity- The capacity to do what is right in the face of temptation or pressure to do otherwise. n Civil disobedience- An open peaceful violation of the law to protest its alleged or supposed injustice Chapter 1 Slide 26 Law for Business and Personal Use © Thomson South-Western

In the U. S. system of democracy, how are ethics reflected in laws? Chapter 1 Slide 27 Law for Business and Personal Use © Thomson South-Western