Business Law Exam 1 Notes/ReferenceRule of Law: Nobody is higher than the source of law. Law over everythingSubstantive Law: Part of the law that creates and defines rights, duties, and powers of individuals (ex. the right to sue, power to amend articles of incorporation).Procedural Law: the rules that prescribe the steps for having rights judicially enforced. Process and mechanics for how rights and duties get resolved.Public Law: Constitutional, Administrative, and CriminalPrivate Law: Business Law: Contracts, Torts, PropertySources of Law:- Constitution (est. 1700s)- Precedent (judges settle based fairly; JUDICIARY BRANCH)- Legislature (written laws from representatives)- Society (norms change, expectations change)o Ex. Constitution’s meaning has changed radically over time; always open to interpretation- Executive branch of government (president and administrators can pass laws and execute them)Stare Decisis: The idea that similar cases should be judged in similar ways.Process of Litigation:TRIAL COURT APPEALS COURT SUPREME COURT(Laws are checked) (Laws are double-checked) (Laws are made)Supreme Court: Only accepts 3% of appeals from potential cases.What makes a crime a CRIME?- Deterrence: a strategy intended to prevent people from doing something by making the penalties very, very high. This is supposed to stop people from engaging in this behavior. - Crimes: wrongful actions against society. Society initiates the action. The state prosecutes, not looking for money, but for incarceration. - Civil Actions (Torts): Private party initiates the action. An individual has the opportunity to pursue and pay the expenses. The primary objective is to make the injured party “whole” through damages (money$$$). Involves compensation.Overall: TORTS aim to make them pay, CRIMES aim to just avoid everything in general.- Mill Harm’s Principle of Crime: People must be able to self-protect. Problem: What defines “harm”?- Lord Patrick Delvin’s Morality Principle of Crime: The basis of criminal law is morality. Society defines morality by saying “you will be punished for partaking in this immoral act”. Problem: not everybody has the same moral code.o Ethics goes above and beyond legal law. - Law and Economics Perspective: We don’t criminalize all types of immoral behavior because doing so would be too expensive. Making sense of criminal enforcement means taking into consideration some of its costs. The major issue is the efficient level of deterrence and the cost of enforcement.- Standard of Proof: In order to make a case, you must have the burden of proof. This is usually the plaintiff who creates the case. If there is no credible evidence, you are innocent. (Innocent until proven guilty).Not absolute certainty. Goal of the defendant’s lawyer is to create as much uncertainty inthe jury’s mind as possible.CRIMINAL STANDARD OF PROOF: Beyond a Reasonable Doubt: (>~75%)CIVIL STANDARD OF PROOF: More likely than not (>~50%)Type 1 Error: False PositivesSome innocent people are proven guilty. How do we reduce this? By making a higher standard of proof to prove.Type 2 Error: By reducing type 1 error, we increase type 2 error.Some guilty people are proven innocent.Natural Law: Created by Aristotle; takes precedent over manmade law. Has to deal with the psychology of well being. Similar to Maslow’s Hierarchy of Needs. Non-competes prevent people from competing with the company (ex. Going off on their own and starting their own business)Algorithm: a bunch of steps together that we take to bring about a result or a goal (ex. Pandora’s system of finding songs they think you will like)1. The judge: Rules on matters of law; asks as a referee. Asks questions: what are the legal elements of the offense? Decides all matters of the law. Has final say.2. The Jury: The finder of fact: did the defendant’s technology infringe the plaintiff’s patent?3. The Attorney: Officer of the Court: professional and ethical duty to represent their clients in the best legal way possible; also have legal and ethical duties to the court. Can not lie to the court; risk being put in jail. Is also the client’s advocate.4. Client’s Role: Usually an executive or business owner in business law.Two models of the attorney-client relationship:a. Traditional: Client delegates all knowledge and authority to the attorney; only talk to lawyers when you need to.b. Participatory: The client works with an attorney to further business goals.The court can only reach a legal outcome if they have jurisdiction (the authority to issue a legal decision on the case. This authority can be gained from several different things).Federal Jurisdiction: States that courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000.State Jurisdiction: Anything not covered under federal law or diversity (ex. contracts, torts, real property). The law is either:Actual Law: a specific past decision, as to that situationProbable Law: a guess as to a specific decisionLitigation: Known as the process of the law. The end result should be a decision to decidethe law/legal issue. Ultimately decides whether the person committed the crime or not.Leads to justice. Known as a legal resolution.3 Phases of Litigation:1. Pleadings 2. Discovery 3. Trial-Complaint-Answer-MotionIf this doesn’t work, the case is taken into the discovery phase.-Most costly and time consuming stage-Interrogation-Subpoena-Declarations**Most cases stop here.-Verdict-Judgment-Less than 3% even make it to this stage. Most cases aresettled in discovery stage.There are 2 basic kinds of torts.1. Negligence: unintentional careless behavior that causes harm.2. Intentional: breach of a civil duty owed to an individual. Wrongful actions; individuals have rights.Intentional torts deal with private law and individual citizens.The goal of a tort is to make the injured party whole again.Torts aim to prevent this kind of behavior from happening again.- Punitive Damages: triple damages are awarded for intentional wrongdoing versus unintentional wrong doing.- Legal Duty: A recognized standard of behavior defined by the court. Arises when rights are created.Mens Rea: Very important term discussed in class. Latin word meaning “state of mind” when a crime was committed. This is often where the line is drawn between unintentionaland intentional torts.4 STATES OF
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