FIN 331

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FIN 331

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Learning Objectives

• Types and sources of law
• Important legal doctrines
• Classification of law
• Jurisprudence and legal reasoning
• Statutory interpretation
• Limitations on judicial power

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Types or Sources of Law

• Federal, state, and tribal level
• Constitution establishes governmental
  structure, specific rights and duties
• Example U.S. Constitution
• Statute enacted by legislative body to regulate
  conduct
• Example Clean Air Act, 42 U.S.C. 7401 et
  seq. (1970)
• Counties and municipalities enact ordinances
  (e.g., zoning ordinance)

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Types or Sources of Law

• Federal, state, and tribal level
• Common Law case law (judge-made)
• Example Gribben v. Wal-Mart Stores, Inc.
• Administrative Law agency rules to implement
  enforcement of statutes
• Example U.S. Environmental Protection Agencys
  Identification and Listing of Hazardous Waste
  Rule, 40CFR261

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Types or Sources of Law

• Issued at the chief executive level
• Executive Order under limited powers
• Examples http//www.whitehouse.gov/news/orders/
• Treaty with other nations, by the U.S.
  president on behalf of the nation, ratified by
  the U.S. Senate
• Example The Moscow Treaty, No. 107-8 (2002)

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Important Doctrines

• Stare Decisis (let the decision stand)
• Doctrine of precedent applied in common law
• Example in Gribben v. Wal-Mart Stores, the
  Indiana Supreme Court cited Cahoon v. Cummings
  for a well-established rule about intentional
  first-party spoliation of evidence
• Equity
• Applied by the judiciary to achieve justice when
  legal rules would produce unfair results
• Examples injunction or specific performance

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Important Doctrines

• Federal supremacy a rule of priority for
  conflicts between laws that holds the U.S.
  Constitution is the supreme law of the land
• Supremacy Clause, Article VI, Section 2, of the
  U.S. Constitution
• Practical meaning
• Federal law defeats state law
• A state constitution defeats state legislation
• A statute defeats an administrative regulation
• A statute or regulation defeats common law

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Classification of Law

• Criminal law establishes duties to society
• Government charges and prosecutes defendant, who
  is found guilty or innocent
• A convicted defendant will be imprisoned or fined

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Classification of Law

• Civil law establishes duties between private
  parties
• Plaintiff sues defendant for monetary damages or
  equitable relief
• A defendant will be held liable or not liable

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Classification of Law

• Substantive law establishes rights and duties of
  people in society
• Example The act of murder is a crime
• Procedural law establishes how to enforce those
  rights and duties
• Example A defendant charged with murder has the
  right to a jury trial

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Classification of Law

• Public law refers to the relationship between
  governments and private parties
• Examples constitutional, statutory, and
  administrative law
• Private law refers to the regulation of conduct
  between private parties
• Examples contract, tort, and property laws

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Jurisprudence

• Jurisprudence refers to the philosophy of law as
  well as the collection of laws
• Legal positivism law is the command of a
  recognized political authority
• Just or unjust, law must be obeyed
• Natural law universal moral rules bind all
  people whether written or unwritten
• Unjust positive laws are invalid

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U.S. v. Lynch

• Facts Procedural History
• Trial court issued injunction to prohibit
  defendants from further violations of a statute
• Defendants moved to amend order based on natural
  law argument that the statute was invalid
• Trial court denied amendment, defendants appealed
• Issue Did the district court fully address and
  deny defendants natural law defense?
• Holding Natural law is not a valid defense.
  Trial court decision affirmed.

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Jurisprudence

• Legal realism defines law as the behavior of the
  judiciary as they rule on matters within the
  legal system
• Thus law in action dominates positive law
• Sociological jurisprudence unites theories that
  examine law within its social context

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Legal Reasoning

• Basically deductive, with the legal rule as the
  major premise and facts as the minor premise
• Result is product of the two
• Court may stand on precedent or distinguish prior
  case from current case
• If precedent inapplicable, new rule developed

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Hagan v. Coca-Cola Bottling Co.

• Facts Procedural History
• Florida plaintiffs drank from bottle of Coke,
  found foreign object, suffered emotional
  distress, and brought suit for negligence
• Jury returned verdict for plaintiffs, judge
  reduced jury award, and both parties appealed
• Certified question sent to Florida Supreme Court
• Question Should the impact rule (physical
  injury required to state a claim) be abolished or
  amended in Florida?

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Hagan v. Coca-Cola Bottling Co.

• Courts Reasoning
• Reviewed facts and arguments of parties
• Reviewed application of impact rule within
  Florida, including modifications to the rule
• Discussed public policy recognized by the Florida
  Supreme Court in Doyle v. Pillsbury Co.
• Noted court decisions in other states
• Holding Impact rule does not apply where
  emotional damages are caused by conduct that is a
  freestanding tort (e.g., contaminated food)

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Statutory Interpretation

• Plain meaning rule court applies statute
  according to usual meaning of the words
• Example Hyatt v. Anoka Police Department
• A court examines legislative history and purpose
  when plain meaning rule is inadequate
• Example What is meant by a prohibition against
  discrimination because of an individuals age?

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General Dynamics Land Systems, Inc. v. Cline

• Facts
• Collective bargaining agreement discriminated
  against workers under 50 years of age plaintiffs
  over 40 and under 50 filed a claim under the Age
  Discrimination in Employment Act (ADEA)
• Issue Does the ADEA forbid favoring the old
  over the young?
• Reasoning Plain meaning of age within the
  statute not clear, but legislative history makes
  clear that an employer may favor an older
  employee over a younger one
• Holding judgment reversed in favor of employer

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Statutory Interpretation

• Courts may interpret a statute in light of a
  general public purpose or public policy
• Courts follow prior interpretation of a statute
  (precedent) to promote consistency
• Maxims may be used to assist in statutory
  interpretation
• Example ejusdem generis (things of the same
  type) when general words follow specific words,
  the general words are limited to the same things
  as specific words
• Automobiles and other vehicles does not include
  airplanes

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Limitations on Judicial Power

• Courts limited to deciding existing cases or
  controversies
• In other words, the dispute must be current and
  not yet resolved
• However, a declaratory judgment allows parties to
  determine rights and duties prior to harm
  occurring

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Limitations on Judicial Power

• Parties must have standing (direct interest in
  the outcome) to sue
• Whales, for example, do not have standing
• The Cetacean Community v. Bush, 386 F.3d 1169
  (9th Cir. 2004)

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Global Business Environment

• Courts may faced with treaty interpretation
• The U.S. Supreme Court interpreted The Warsaw
  Convention in Olympic Airways v. Husain
• How would you have interpreted the treaty
  language?

The carrier shall be liable for damage sustained
in the event of the death or wounding of a
passenger or any other bodily injury suffered by
a passenger, if the accident which caused the
damage so sustained took place on board the
aircraft or in the course of the operations of
embarking or disembarking. Warsaw Convention,
Art. 17
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