Legal and Ethical Environment of Business

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LEGAL AND ETHICAL ENVIRONMENT OF BUSINESS

August 13th, 2012

LAW / ECONOMIC / ETHICAL

WHERE THE LAW COMES FROM?
Maintain your property

LAW
Rules related to the allocation of scarce resources

WHAT DO WE WANT?
Earth at night
Predictability – Certainty – commerce loves certainty oStable governments equal strong economy
oBank accounts, brokerage accounts, land titles
oProperty the governmentally supported right to exclude
oPredictable sanctions for wrongful acts
oDemocracy – best – why are you so?
oDo not think about “right” think about best for you
Law is a competitive tool

LEGAL SYSTEM OF THE WORLD
Civil law
oGap filler
Common Law
Muslim Law
oRole of religion and US 1st amendment
Customary Law
Hybrid and Mixed systems

ENGLISH COMMON LAW TRADITION
1066 – William
oKings Court
Power top down
Decisions tend to go certain ways
Common Law
oCommon to all
Remedy sought determines the court
Distinction blurred today – equitable – rare
Law remedies

US
Merged the law and equity courts
Juries now very prevalent
oAble to handle complex business issues
Power from the people
US Constitution – we the people – bedrock beliefs
Federal Law – State Law
oNo Federal commercial law
Statutes – States UCC
oExplain uniform laws
Common law
Public law
oCrimes
Private law
oContracts
oTorts

JURISPRUDENCE
Stare Decisis – predictability4
ojudge made
oPrecedent
Mandatory
Persuasive
Dual court systems
Departures from precedent
Public hospitals
Plessey – Dred Scott
oWhat goes into a court´s decision
Public policy?
Economic theory
Precedent?
Pressure

DECISION MAKING
Using cases as looking at others´ errors
IRAC
oIssue
oRule
oApplication
oConclusion
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