Corporate Law Chapter 1 + 2
What is law?
→ The law is a set of legal rules that governs the way members of a society act towards one another
(Trias Politica) from Montesquieu
→ Separation of Power into 1) Legislative 2) Executive 3) Judicial
(Judges can only judge the application of the legislature to particular cases, not the legislation itself)
▪ Substantive law
→ is composed of legal rules that define the content of just behavior
▪ Formal law
→ is composed of legal rules that maintain substantive law
▪ Public law
= regulates relationships between state and its citizens (enforcement of the law)
▪ Private law
= regulates relationships in between citizens
Justice = moral (and codified) conviction of given society
Opportuness = expression of effectiveness (modification)
Legal certainty = legality → predict legal consequences of behavior
Origin of law
Positivist Law
= law comes from codification; high legal certainty, focus on formalization
Pro: protection of people from extreme understandings of natural law
Con: written law is always behind on reality (time lagging)
Naturalist Law
= law emerges from nature; high legal uncertainty, focus on content
Pro: natural law defines human rights (~ common sense)
Con: vulnerable to perspective
Codified rules = written law
→ there needs to be room for interpretation
Treaties (= international codified standards)
2 steps: signature and ratification
Bilateral – Multilateral
,Examples: European Union, WTO, International Convention on Civil and Political Rights
Monistic system (Austria, France, Germany, Netherlands etc.)
Monists accept that the internal and international legal systems form a unity
Dualistic system (United Kingdom, Australia etc.)
Dualists emphasize the difference between national and international law, and require the translation of the
latter into the former (even after a treaty is signed and ratified by the legislation). Without this translation,
international law does not exist as law
Most states are partly monistic and partly dualistic
Application of Law
Stare decisis
→ legal principle in which courts have to follow the legal reasoning as applied in previous cases
Its administration → branches with boundaries of their competences
Tax law, local law, education law, etc.
Secular states → explicitly excluded religious sources in constitution
Non-secular / mixed = might rely on religious writings
Custom = an established and accepted legal practice
Chapter 2: Comparative Law
Normative values within every national law
,DESTEP Analysis
to evaluate what country has best legal climate to offer
products or services
▪ Macro comparison of law systems → legal
families
Common Law vs. Civil Law
Shari’a Law
▪ Micro comparison of law
→ functional method about the Activity in which the legal solutions to social problems are compared
Common Law
Case law results in codification of rulings
Developed in British Empire by Judges
Law is an applied tool rather than an academic subject
extensive freedom of contracts
Judges are interpreters and also law-makers (judges can base decisions on both, previous court
rulings as well as legislation)
, Common law → ‘’everything is permitted that is not explicitly prohibited by law’’
Stare decisis = principle that courts have to follow the legal reasoning as previous cases
Especially lower court cannot contradict higher court in reasoning
Tort = a civil wrong that causes someone to suffer loss or harm
Civil Law
Codified standards → adjustments require democratic legislation
Enlightenment
French civil code 1789
Academically motivated
Former rulings can be used to solve a case only when written law doesn’t offer a solution
Socialist law
Driven by administration – no private law
Law in place to realize political agenda
‘’wellbeing of the collective prevails over the wellbeing of the individual’’
Religious law
Religion & state are not separated, and religious writings are superior to any (contradictory) law
Chapter 7: European Union
→ started out in 1952 as cooperation for coal and steel (to maintain peace with regard to weapon
manufacturing)
‘’peace through trade’’
Supranational Law
→ European law is superior to domestic law (= national courts must disregard national law if it
contradicts European law)
→ European law is directly applicable in member states
(every European citizen can invoke the European law effectively)
TFEU → signed Treaty for Functioning of European Union
Free Trade in European Union
4 freedoms
Harmonization of law
Competition rules
What is law?
→ The law is a set of legal rules that governs the way members of a society act towards one another
(Trias Politica) from Montesquieu
→ Separation of Power into 1) Legislative 2) Executive 3) Judicial
(Judges can only judge the application of the legislature to particular cases, not the legislation itself)
▪ Substantive law
→ is composed of legal rules that define the content of just behavior
▪ Formal law
→ is composed of legal rules that maintain substantive law
▪ Public law
= regulates relationships between state and its citizens (enforcement of the law)
▪ Private law
= regulates relationships in between citizens
Justice = moral (and codified) conviction of given society
Opportuness = expression of effectiveness (modification)
Legal certainty = legality → predict legal consequences of behavior
Origin of law
Positivist Law
= law comes from codification; high legal certainty, focus on formalization
Pro: protection of people from extreme understandings of natural law
Con: written law is always behind on reality (time lagging)
Naturalist Law
= law emerges from nature; high legal uncertainty, focus on content
Pro: natural law defines human rights (~ common sense)
Con: vulnerable to perspective
Codified rules = written law
→ there needs to be room for interpretation
Treaties (= international codified standards)
2 steps: signature and ratification
Bilateral – Multilateral
,Examples: European Union, WTO, International Convention on Civil and Political Rights
Monistic system (Austria, France, Germany, Netherlands etc.)
Monists accept that the internal and international legal systems form a unity
Dualistic system (United Kingdom, Australia etc.)
Dualists emphasize the difference between national and international law, and require the translation of the
latter into the former (even after a treaty is signed and ratified by the legislation). Without this translation,
international law does not exist as law
Most states are partly monistic and partly dualistic
Application of Law
Stare decisis
→ legal principle in which courts have to follow the legal reasoning as applied in previous cases
Its administration → branches with boundaries of their competences
Tax law, local law, education law, etc.
Secular states → explicitly excluded religious sources in constitution
Non-secular / mixed = might rely on religious writings
Custom = an established and accepted legal practice
Chapter 2: Comparative Law
Normative values within every national law
,DESTEP Analysis
to evaluate what country has best legal climate to offer
products or services
▪ Macro comparison of law systems → legal
families
Common Law vs. Civil Law
Shari’a Law
▪ Micro comparison of law
→ functional method about the Activity in which the legal solutions to social problems are compared
Common Law
Case law results in codification of rulings
Developed in British Empire by Judges
Law is an applied tool rather than an academic subject
extensive freedom of contracts
Judges are interpreters and also law-makers (judges can base decisions on both, previous court
rulings as well as legislation)
, Common law → ‘’everything is permitted that is not explicitly prohibited by law’’
Stare decisis = principle that courts have to follow the legal reasoning as previous cases
Especially lower court cannot contradict higher court in reasoning
Tort = a civil wrong that causes someone to suffer loss or harm
Civil Law
Codified standards → adjustments require democratic legislation
Enlightenment
French civil code 1789
Academically motivated
Former rulings can be used to solve a case only when written law doesn’t offer a solution
Socialist law
Driven by administration – no private law
Law in place to realize political agenda
‘’wellbeing of the collective prevails over the wellbeing of the individual’’
Religious law
Religion & state are not separated, and religious writings are superior to any (contradictory) law
Chapter 7: European Union
→ started out in 1952 as cooperation for coal and steel (to maintain peace with regard to weapon
manufacturing)
‘’peace through trade’’
Supranational Law
→ European law is superior to domestic law (= national courts must disregard national law if it
contradicts European law)
→ European law is directly applicable in member states
(every European citizen can invoke the European law effectively)
TFEU → signed Treaty for Functioning of European Union
Free Trade in European Union
4 freedoms
Harmonization of law
Competition rules
