Introduction to Law

Definition of Law

Black's Law Dictionary defines law as a "body of rules of action or conduct prescribed by controlling authority, and having binding legal force. That which must be obeyed by citizens subject to sanctions or legal consequence is a law." Law, in other words, exists to create order and resolve disputes.

The way that you and I view the law, and consequently study and learn it, depends to some extent on our worldview, perspective, or ideology. As you have probably noticed, the lens through which individuals view the law may vary.

For example, you may know someone who thinks in terms of black and white; the “law is the law.” You likely know others who find that context is everything, blurring the lines between different viewpoints. A quick example. I have a particular member of my extended family concerned with undocumented immigrants. To her, all such individuals should be deported. Others in the proverbial family tree disagree. They perhaps know some individuals that came to the United States to escape persecution at home or for other reasons that would justify the immigrant’s unauthorized entry into the United States.

Beyond making family reunions more lively, these varied viewpoints illustrate in a simple way, the more complicated legal theories. While a detailed analysis of the different legal schools of thought is unnecessary for this course, a quick summary of a few can be beneficial.  

Law and Morality

Laws generally reflect the common morality of a society. Government seeks to ally itself with the prevailing customs. As a result, there is a close, though never perfectly-aligned, relationship between law and society's prevailing moral trends. This benefits those in political power in that they don't have to educate every citizen on each and every law. However, you can likely think of numerous laws that failed to uphold what we now consider to be the moral right. The laws will often get there, but sometimes lag significantly behind society's changing sense of right and wrong. 

Legal Ethics

Throughout this class, you will read and discuss cases and hypotheticals which have been specifically chosen because they are frequently faced by those in business. You will analyze these situations based on the law you have learned. I challenge you to also consider the ethical dilemmas involved in these business decisions. The law clearly does not influence all business decisions. When facing an ethical decision, you may ask "what should I do?" as opposed to a legal decision where you typically ask, "what must I do?"

As with the law, ethical considerations can be viewed using various theories. These theories may help you organize your thoughts as you work through difficult situations. For example, you may consider an ethical choice using the following:

When analyzing ethical dilemmas, a framework may be helpful. First, gather facts and decide what legal concerns are at issue. Next, determine what parties are involved and how a decision will affect those parties and society as a whole. Determine your values and compare those to the business and other stakeholders. Finally, reflect on the outcomes of the decision and determine the best course of action.

Business Law

Business law consists of enforceable rules of conduct that govern commercial relationships. Understanding these rules is vital, not only for attorneys, but for all those engaged in business. Each area of business sits on a foundation of business law that we will discuss this semester.

A theme of this class will be a surprising number of legal implications that result from what on the surface might look like simple, everyday business decisions. 

Let's take an example of a student looking to start a small business renting gaming consoles in the Rexburg, Idaho area. He visits an attorney seeking quick (and often free) advice, yet the legal issues facing him are too numerous for a quick office visit. For example, he will need to:

There are numerous other considerations, including advertising laws, hiring practices, and whether his current lease permits him to run a business out of his apartment. Understanding these issues, which we will cover in this book, will help business law students protect their interests and enjoy greater success as employees, entrepreneurs, and managers.

Sources of Business Law

Business owners often worry that there are too many laws and regulations to know, let alone understand. To be honest, there are a lot of them. Let’s start with the basics.

A Note on Equity Claims. Throughout this course, you will read cases and review situations in which the legal remedy seems unfair or inadequate. In such a case, the plaintiff may request equitable remedies. Equitable claims derive from medieval equitable courts, which existed separate from legal courts. In legal courts, plaintiffs requested money. In equitable courts, plaintiffs requested something else (i.e., the defendant to do something). In the United States, this distinction between courts no longer exists. Courts in the US can grant both legal and equitable remedies. Common types of equitable relief include injunctions (court orders for a person to do or not do something) and specific performance (when a court orders a party to perform its obligations).

By way of a simplified example, consider that James and Jill marry while at BYU-Idaho. Following graduation, James enrolls at Harvard Law School. During the three years of law school, Jill works to support the family and pays all housing and tuition costs. At last, James graduates and accepts a job at a prestigious law firm in New York earning $210,000 per year. On the night of graduation, James hands Jill the divorce papers. In a divorce proceeding, the court distributes the marital assets equally. But in our hypothetical, James and Jill have no assets other than $20 in the jointly owned bank account. As a result, the legal remedy is to divide the $10 among the pair and sign off on the divorce. But you may rightly think, “that’s not fair - he’s about to have a huge paycheck coming while Jill paid all her earnings to his education.” 

In such a case, the court may award equitable remedies, noting that it would be unfair for one spouse to receive nothing after spending so much time and effort in the furtherance of a spouse’s degree. Equitable remedies may also be appropriate if money just can’t make the plaintiff “whole,” because money simply is not sufficient (i.e., one party contracts to buy a very rare item and the defendant breaches or commits that case the plaintiff doesn’t want money, she wants the thing that the other party agreed to sell!). 

A Note on Private Contracts (Public v Private Law). When an individual or business is wronged, it will often initiate legal proceedings against the party that committed the wrongdoing using the sources of law mentioned above. Yet these sources of law are not the only sources that offer recourse for wrongs. For example, let’s say that you enter into a contract with a classmate to mow the classmate’s lawn in return for $20. Before you are paid, you refuse to mow the yard. Although you have not violated any local, federal, or constitutional law (as far as I can tell), your classmate may still initiate a lawsuit against you because you breached your agreement. This is an example of private law, which also includes other similar agreements between individual parties such as employment contacts, rental agreements, homeowner association agreements, and purchase agreements. Note that the US court system will enforce these private agreements just as they enforce constitutional violations listed above. 

Causes of Action, Precedent, Stare Decisis

In order to bring a lawsuit, a claimant must have a cause of action. For example, you may enter into an agreement with your teacher under which you would receive an A on an assignment if you bring her a box of Crumbl cookies (preferably the peanut butter cookies). If she fails to give you an A after you deliver the cookies, you may feel wronged, but you cannot bring a lawsuit unless you can show that your teacher's actions violated the law governing contracts. 

Even if your teacher's actions constituted an actionable breach of contract, she may have a legal excuse as to why she does not have to give you an A. Moreover, some wrongs committed against you are not actionable because the harm is not recognized by our legal system - such as being stood up for a date.

Precedent involves how courts have decided similar cases that occurred in the past. Because our legal system was handed down to us from English law, we place a great deal of deference on those earlier cases and therefore judges are unlikely to rule differently. Stare decisis is a principle stating that rulings made in higher courts are binding precedent for lower courts. For example, if a state's highest court ruled that there is no cause of action for being jilted at the altar, a judge hearing your case for this same complaint would likely dismiss your lawsuit. You may be able to convince the judge otherwise, however, if you can show that your lawsuit is different in important ways from the earlier case.

Attorney-Client Privilege

When businesses or individuals retain (hire) an attorney, they may benefit from an evidentiary protection known as the attorney-client privilege. This means that the attorney cannot divulge statements made by the client to the attorney. This protection exists because the law recognizes the importance of honesty and candor between a client and the attorney. 

That being said, this privilege is not absolute. For example, the privilege requires an actual attorney-client relationship. This means that if you initiate a conversation with an attorney, the attorney immediately declines to represent you, and you continue to divulge confidential information to that attorney, the information is not privileged and the attorney may be compelled to divulge your statements in court. 

Note that the privilege is that of the client. If the client waives this privilege, the attorney cannot then claim attorney-client privilege. The client may do this through any action that a reasonable person would interpret as waiving the privilege. For example, remember that the privilege protects confidential information. If the client publishes that information to others (i.e., speaking very loudly in a crowded subway), the privilege may be lost. 

It’s also extremely important to identify who the client is. This sounds simple, but can be difficult. For example, an attorney may be hired to represent a corporation. A corporation has many owners, directors, and managers. These individuals often incorrectly believe that the attorney represents them. They are, after all, running the corporation. However, these individuals may take actions or make decisions that negatively affect the corporation. In the course of these decisions, these individuals may make statements to the corporate attorney (known as corporate counsel) that they incorrectly believe are privileged. But as you might guess, because the attorney represents the business and not the individuals, no such privilege exists and the attorney may divulge what was said.

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