Chapter 1. Legal, Business, and E-Commerce Environment

Chapter Objectives
Define law.
List and describe the functions of law.
Describe the flexibility of the law.
List and describe the schools of jurisprudential thought.
Explain the development of the US legal system.
Explain how English common law was adopted in the US.
List and describe the sources of law in the US.
Define the doctrine of stare decisis.
Describe other countries' legal systems.
Describe the development of E-Commerce and Internet law.
Apply critical legal thinking in analyzing judicial decisions.

Definition of law
Law is a body of rules of action or conduct prescribed by controlling authority, and having binding legal force. That which must be obeyed and followed by citizens subject to sanctions or legal consequences is a law.

Functions of law

Flexibility of the law
Law responds to cultural, technological, economic, and social changes. Laws that are no longer viable are often repealed, although it may take years for that to happen. Sometimes, because of error or misuse, the law does not reach a fair result.

Schools of jurisprudential thought

Development of the US legal System
The US court system developed from English common law. Under traditional English common law, there were three types of courts:
Law courts—courts that developed and administered a uniform set of laws decreed by the kings and queens after William the Conqueror. Legal procedure was emphasized over merits
Chancery (equity) courts—courts that granted relief based on fairness
Merchant courts—courts established to administer the "law of merchants"

Adoption of English common law in the US All states except Louisiana base their legal systems primarily on English common law.
Because of its French heritage, Louisiana bases its legal system on civil law.

Sources of US law

Doctrine of stare decisis
Precedent is a rule of law established in a court decision. Lower courts must follow the precedent established by higher courts. The doctrine of stare decisis means "to stand by the decision" or adherence to precedent.

Other countries' legal systems
There are other major legal systems in addition to the Anglo-American common law system. Major systems include:

E-commerce and Internet Law
Our legal system has adapted to the reality of e-commerce and the Internet. For example, contracts on the Internet are treated as any contract is treated under the law. However, there are many issues, such as taxation of sales on the Internet, pornography, intellectual property, etc., that still need to be addressed.

Critical Legal Thinking Critical legal thinking is the process of specifying the issue presented by a case, identifying the key facts in the case and applicable law, and then applying the law to the facts to come to a conclusion that answers the issue presented. Use the "case for briefing" exercise at the end of the chapter as a tool to teach students critical legal thinking.


Internet Links
Legal history: www.jurist.law.pitt.edu/sg_hist.htm
Government: whitehouse.gov
Legal profession: abanet.org