The Role of Law in Society
Law is the set of standards, principles, and rules a society sets up to govern the actions of its members. It spells out the rules and the penalties for failure to abide by them.
Sources of Law
As Figure 3-2 shows, the sources of law are (1) Customs and judicial precedents. (2) Legislative actions, and (3) administrative rulings. The three corresponding types of law are (1) common law, (2) statutory law, and (3) administrative law.
Common law is the body of unwritten law that has grown out of previous judicial decisions (judicial precedents) and accepted customs. Decisions made in earlier cases involving the same legal point guide the court. Common law is often called case law.
Statutory law is a system of laws that are written, or codified, by legislative bodies. The U.S. Constitution and state constitutions are the primary basis for statutory law.
Administrative law is the set of rules developed by government agencies on the basis of their interpretations of the statutory laws that they administer. Firms often are asked to participate in the rule-making procedure. After passage of the Americans with Disabilities Act in 1990, the Equal Employment Opportunity Commission sought input from businesspeople before it started writing rules.
Public and Private Law
Law can also be classified as public or private. Public law is the branch of law that relates to society as a whole. It includes, for example, criminal law and administrative law. False advertising, patent infringement, and price fixing are covered by public law.
Private law (or civil law) is the branch of law that relates to relationships between individuals, groups of individuals, and corporations. Business law is a part of private law. A retail store’s failure to pay a supplier for a shipment of dresses is covered by private law.
The Court System
The judiciary (or court system) is the branch of government that administers justice and applies laws to resolve legal disputes among individuals, organizations, or governments. Common law is based on court decisions. Courts also decide issues that are not covered by statutory law and administrative law.
Courts differ in their jurisdiction. Jurisdiction is the legal authority of a court to hear and to decide cases. The United States has a dual system of federal and state courts. As Figure 3-3 shows, the federal court system includes the Supreme Court, federal courts of appeals (appellate courts), and district courts (trial courts). State court systems include supreme courts, courts of appeals (appellate courts), and circuit courts (trial courts).
At the federal level, the main trial courts are the U.S. district courts. Trial courts are courts of original jurisdiction that exist in both the federal and state judiciaries. Each state has one or more federal district courts, which hear cases involving federal crimes, disputes between citizens of different states, immigration law, patents, copyrights, and bankruptcy. Special federal courts include those that handle tax matters (U.S. Tax Court), international trade (U.S. Court of International Trade), and claims against the U.S. government (U.S. Claims Court).
At the state level, trial courts are often called circuit courts. However, they also might be called superior courts, common pleas courts, or district courts. Special courts include probate courts and small claims courts.
The losing party in a trial court may appeal the decision. Appellate courts (courts of appeals) are courts that exist in both the federal and state judiciaries and to which a losing party (appellant) in a trial court can appeal the decision. Appellate courts review cases decided by trial courts if the losing party questions the lower court’s ruling on a matter of law. Appellate courts cannot review a trial court’s decisions regarding the facts of the case.
At the federal level, there are twelve U.S. circuit courts of appeals. (There is also an additional federal court of appeals the United States Court of Appeals for the Federal Circuit, which has nationwide jurisdiction.) Each circuit court of appeals hears appeals from decisions rendered by federal district courts in its jurisdiction. U.S. circuit courts also may review orders from administrative agencies such as the Securities and Exchange Commission (SEC) and the National Labor Relations Board (NLRB). States also have appellate courts for cases tried in state district courts, common pleas courts, superior courts, and circuit courts.
The Supreme Court
Appeals of decisions handed down by U.S. circuit courts of appeals can go to the highest court in the land, the U.S. Supreme Court. (The U.S. Supreme Court, in addition to its appellate jurisdiction, has original jurisdiction over cases involving two states or representatives of other countries.) Appeals from state courts of appeals are heard by state supreme courts or their equivalent. If a decision rendered by a state Supreme Court is not satisfactory to a party, that party can appeal to the U.S. Supreme Court, which may or may not decide to hear the case. The vast majority of appeals to the U.S. Supreme Court are not heard by the court.
Related Web Search : The Role of Law in Society | Sources of Law | Public and Private Law | The Court System | Trial Courts | Appellate Courts | The Supreme Court