Chapter 1: What is business law?
key terms
- Law that which a judge will ecide concerning matters properly brought before
him/her; in a broader sense, any rule that society will enforce
- Code in common law = collection of statutes enacted by legislative enacted by
legislative bodies, incl congress and state legislatures
Do you know the basics?
1) In what major way does the common law differ from the civil law?
- Common law uses precents and does not set the out the law in a single code
- Civil law is written out in codes
2) Why should a definition of law emphasize enforcement?
- A law without enforcement has no effect on the citizen. Thus, citizens will
have no respect for the law if it is not enforceable
3) Are there any circumstances under which society could exist without law?
- In the absence of law, disagreements may be minimized but can’t be
eliminated since the society consist of different people
4) Why is it likely that the common law system will produce a greater number of
lawyers than the civil law system?
- Common law encourages litigation
5) Is it easier to know your rights in a civil law country or a common law country?
- It will not be easier to know your rights in the civil law system since its written
out in codes
Guiding questions:
1) Describe the origin and nature of the Law
- the origin of the law is obscure; cannot exist w/o law. individual power and
cunning constituted the first law, and primitive governments merely presided
over the lex talionis, or law of private retribution
2) Provide a definition of the Law, as discussed in class.
- The law can be defined as enforceable rules governing relationships among
individuals and between individuals & their society.
, 3) How does morality and culture shape the law? Provide concrete examples.
Why is this especially important in the business context?
- Law generally represents the developing, common morality of human beings.
Government almost always seeks to ally itself with prevailing customs, to
proclaim as right only that which most citizens already perceive to be right,
and to impose as law the rules considered by the majority or by more
powerful or vocal minorities to be moral and therefore just. Thus, law reflects
values and beliefs of society or its ruling group. There is a close relationship
between morality and any rule that society will enforce but don’t confuse
legality with morality. Even though there is a close relationship with morality
and law.
- Law sets out rights, duties and obligations. As a result, stability and
predictability is achieved.
a. Personal Level: Citizens need to be able to determine “right from wrong”
b. Business Level: Degree of “Legal Certainty” in business dealings
- What is legally right or wrong depends on where you are. Eg, what is
considered right in Belgium may be wrong in Germany
4) Compare and contrast the Common Law and Civil Law Systems.
Civil law ‘Continental European Approach’ common law “Anglo-Saxon Tradition”
Oldest & most influential legal system found on a“case-by-case basis”
Roman-Germanic: codified law based on Law is based on court decisions rather than
Roman code formal codes: “precedent”
Legal rules set out in one comprehensive & Overall accumulation of judicial decisions –
systemized code and accompanying law is developed and pronounced by courts
statutes. Eg: family law, property law,
succession law, law of obligations,
commercial law, labour law, criminal law,
etc.
judicial decisions, case law, are not a to be supplemented by judicial opinions
source of law, although judicial precedents and, for some areas of law, by
may be useful in the decision of cases. administrative regulation.
, 5) What is “Stare Decisis?” How does it help to shape Business Law?
- Stare Decisis (stand by the decision): requires courts to follow their own
precedents; binds all of the lower courts of a jurisdiction to determinations of
the highest court in that same jurisdiction
- In the absence of a precedent, a court may follow its own sense of justice or
fairness, with due regard for prevailing custom or morality
Influences of the law
Important in the international business context
- What is the current legal environment?
- Society’s current attitudes?
- Can the law be “behind the times”?
- Noteworthy trends?
Case Study on Hyundai: Key Legal Qs for Int'l Expansion
FACTS: Congratulations, you have been named the new President & CEO of Hyundai Motor
North America. Hyundai is a South Korean multinational automotive manufacturer
headquartered in Seoul, South Korea. Hyundai currently holds 10% market share in the U.S.
Eager to increase its US market share, the company has recently announced that Hyundai
intends to build a $5.5 billion manufacturing facility near Savannah, Georgia (U.S.). It plans
to employ 8,100 workers to work in its electric vehicle assembly plant and an adjacent
electric vehicle battery factory. In the initial stage, the plant will produce 300,000 vehicles per
year. Scheduled for completion in 2025, this will be the largest single economic development
project in the history of the state of Georgia.
Task: How did the local laws of the state of Georgia influence Hyundai’s decision to build on
this new site? What areas of the law will Hyundai need to continue to focus on as the plant
kicks into operations? Provide examples.
Business decision making: bankruptcy, corporate fraud, business organisation, contracts,
employment, competition, banking, sales, product liability, agency, mergers & acquisition,
intellectual property
International private law = “Conflict of laws” = set of rules or procedural law that regulates
relationships between persons (or entities) of different nationalities
- determines which legal systems and law of which jurisdiction will apply to a legal
dispute among individuals involving a foreign element
- Transnational rules that national courts use to regulate three primary relationships:
, a) relationship between two nations: example The Treaty of Paris (=peace
agreement between Britain on one side andAmerican and the other allies on
the other side)
b) relationship between a nation and an individual
c) relationship between persons/entities from different countries: For torts, the
applicable law is usually the law of the state where the injury occurred. For
contracts, the courts usually look to the law intended by the parties. A court
ordinarily honours an express stipulation in a contract that the contract is to
be governed by a particular state’s laws. Even if no such express statement is
made, courts will often look to the parties’ impliedintentions. At that point,
though, the courts may turn to an earlier approach (still followed in some
states) governing conflicts of law in contract cases: use of the law where the
contract was made or performed. (In very complex tort or contract cases,
some courts seek to determine, and then apply, the law of the state with the
most significant ties to the parties and the matter in dispute.
Lecture 2: Free Speech
Yahoo case: yahoo sold nazi trade marks → first case to set for the internet (common law)
- The French League: stands for preventing of racism, so took yahoo to the French
court
- Yahoo won: chilling effect and first amendment
American approach;
Constitution of the United States of America
U.S. Constitution: Fundamental law of the U.S. which was ratified by the states in 1788
❖ Creates three branches of government: legislative, executive, and judicial.
❖ Protects individual rights by limiting the government’s ability to restrict those rights
Bill of Rights
• First 10 amendments to U.S. Constitution
• Guarantees fundamental rights and protects these rights from intrusive government action
• First Amendment: Includes freedom of speech, freedom to assemble, freedom of the press
and freedom of religion.
key terms
- Law that which a judge will ecide concerning matters properly brought before
him/her; in a broader sense, any rule that society will enforce
- Code in common law = collection of statutes enacted by legislative enacted by
legislative bodies, incl congress and state legislatures
Do you know the basics?
1) In what major way does the common law differ from the civil law?
- Common law uses precents and does not set the out the law in a single code
- Civil law is written out in codes
2) Why should a definition of law emphasize enforcement?
- A law without enforcement has no effect on the citizen. Thus, citizens will
have no respect for the law if it is not enforceable
3) Are there any circumstances under which society could exist without law?
- In the absence of law, disagreements may be minimized but can’t be
eliminated since the society consist of different people
4) Why is it likely that the common law system will produce a greater number of
lawyers than the civil law system?
- Common law encourages litigation
5) Is it easier to know your rights in a civil law country or a common law country?
- It will not be easier to know your rights in the civil law system since its written
out in codes
Guiding questions:
1) Describe the origin and nature of the Law
- the origin of the law is obscure; cannot exist w/o law. individual power and
cunning constituted the first law, and primitive governments merely presided
over the lex talionis, or law of private retribution
2) Provide a definition of the Law, as discussed in class.
- The law can be defined as enforceable rules governing relationships among
individuals and between individuals & their society.
, 3) How does morality and culture shape the law? Provide concrete examples.
Why is this especially important in the business context?
- Law generally represents the developing, common morality of human beings.
Government almost always seeks to ally itself with prevailing customs, to
proclaim as right only that which most citizens already perceive to be right,
and to impose as law the rules considered by the majority or by more
powerful or vocal minorities to be moral and therefore just. Thus, law reflects
values and beliefs of society or its ruling group. There is a close relationship
between morality and any rule that society will enforce but don’t confuse
legality with morality. Even though there is a close relationship with morality
and law.
- Law sets out rights, duties and obligations. As a result, stability and
predictability is achieved.
a. Personal Level: Citizens need to be able to determine “right from wrong”
b. Business Level: Degree of “Legal Certainty” in business dealings
- What is legally right or wrong depends on where you are. Eg, what is
considered right in Belgium may be wrong in Germany
4) Compare and contrast the Common Law and Civil Law Systems.
Civil law ‘Continental European Approach’ common law “Anglo-Saxon Tradition”
Oldest & most influential legal system found on a“case-by-case basis”
Roman-Germanic: codified law based on Law is based on court decisions rather than
Roman code formal codes: “precedent”
Legal rules set out in one comprehensive & Overall accumulation of judicial decisions –
systemized code and accompanying law is developed and pronounced by courts
statutes. Eg: family law, property law,
succession law, law of obligations,
commercial law, labour law, criminal law,
etc.
judicial decisions, case law, are not a to be supplemented by judicial opinions
source of law, although judicial precedents and, for some areas of law, by
may be useful in the decision of cases. administrative regulation.
, 5) What is “Stare Decisis?” How does it help to shape Business Law?
- Stare Decisis (stand by the decision): requires courts to follow their own
precedents; binds all of the lower courts of a jurisdiction to determinations of
the highest court in that same jurisdiction
- In the absence of a precedent, a court may follow its own sense of justice or
fairness, with due regard for prevailing custom or morality
Influences of the law
Important in the international business context
- What is the current legal environment?
- Society’s current attitudes?
- Can the law be “behind the times”?
- Noteworthy trends?
Case Study on Hyundai: Key Legal Qs for Int'l Expansion
FACTS: Congratulations, you have been named the new President & CEO of Hyundai Motor
North America. Hyundai is a South Korean multinational automotive manufacturer
headquartered in Seoul, South Korea. Hyundai currently holds 10% market share in the U.S.
Eager to increase its US market share, the company has recently announced that Hyundai
intends to build a $5.5 billion manufacturing facility near Savannah, Georgia (U.S.). It plans
to employ 8,100 workers to work in its electric vehicle assembly plant and an adjacent
electric vehicle battery factory. In the initial stage, the plant will produce 300,000 vehicles per
year. Scheduled for completion in 2025, this will be the largest single economic development
project in the history of the state of Georgia.
Task: How did the local laws of the state of Georgia influence Hyundai’s decision to build on
this new site? What areas of the law will Hyundai need to continue to focus on as the plant
kicks into operations? Provide examples.
Business decision making: bankruptcy, corporate fraud, business organisation, contracts,
employment, competition, banking, sales, product liability, agency, mergers & acquisition,
intellectual property
International private law = “Conflict of laws” = set of rules or procedural law that regulates
relationships between persons (or entities) of different nationalities
- determines which legal systems and law of which jurisdiction will apply to a legal
dispute among individuals involving a foreign element
- Transnational rules that national courts use to regulate three primary relationships:
, a) relationship between two nations: example The Treaty of Paris (=peace
agreement between Britain on one side andAmerican and the other allies on
the other side)
b) relationship between a nation and an individual
c) relationship between persons/entities from different countries: For torts, the
applicable law is usually the law of the state where the injury occurred. For
contracts, the courts usually look to the law intended by the parties. A court
ordinarily honours an express stipulation in a contract that the contract is to
be governed by a particular state’s laws. Even if no such express statement is
made, courts will often look to the parties’ impliedintentions. At that point,
though, the courts may turn to an earlier approach (still followed in some
states) governing conflicts of law in contract cases: use of the law where the
contract was made or performed. (In very complex tort or contract cases,
some courts seek to determine, and then apply, the law of the state with the
most significant ties to the parties and the matter in dispute.
Lecture 2: Free Speech
Yahoo case: yahoo sold nazi trade marks → first case to set for the internet (common law)
- The French League: stands for preventing of racism, so took yahoo to the French
court
- Yahoo won: chilling effect and first amendment
American approach;
Constitution of the United States of America
U.S. Constitution: Fundamental law of the U.S. which was ratified by the states in 1788
❖ Creates three branches of government: legislative, executive, and judicial.
❖ Protects individual rights by limiting the government’s ability to restrict those rights
Bill of Rights
• First 10 amendments to U.S. Constitution
• Guarantees fundamental rights and protects these rights from intrusive government action
• First Amendment: Includes freedom of speech, freedom to assemble, freedom of the press
and freedom of religion.
