WEEK 1: INTRODUCTION TO IBL - Textbook: pp. ; pp. ; and pp.
Every society makes and enforces laws that govern the conduct of individuals, businesses, and other
organisations that function within it. Businesses must operate within the framework of these laws, and it
is essential for the persons working within the business world to have an understanding of how law
works and affects their businesses. Although specialist legal advice is usually obtained on specific legal
issues, it is essential to understand the core principles of business law and to know when to seek legal
advice.
IBL for IB aims to:
Help you understand how the law affects businesses
Highlight legal pitfalls in practice
Help you identify a potential legal problem
Find solutions or call a lawyer
Law and business
Law is the body of rules and regulations that govern the activities of persons within a
country jurisdiction
Rules governing conduct of “actors” natural and artificial persons in a society
Substantive law: the law creates rights, obligations, facilitating “co existence” ”co operation”
Procedural law: procedures to enforce law when breached
The discipline of law is very territorial law depends on where you are → it is not universal
Law has several layers:
. National law: rules made by specific countries jurisdictions and are applicable within that
specific jurisdiction only
a. German criminal law, Dutch criminal law, English criminal law…
b. National contract law or thought law
. EU law: made by EU institutions and applicable for all EU member states
. International law: governs interactions between sovereign countries
a. International trade law, law of WTO
In this course, when talking about national law we refer to English national law, and why English law?
Because we need to pick one
English law is pro business and adapted to foreign parties
Due to the global reach of English law, widely recognized and it has influenced other jurisdictions
Sector dominance of English law
High degree of certainty and predictability
Flexibility of common law
Why should we care about law as business students?
Legal rules in places influence what businesses can do or how they go about doing it
○ What to build and sell IP, products liability…
, ○ How to fund products contracts, selling shares, debt financing…
○ How to protect what they make IP, contracts…
○ How to behave toward and in relation to others contract law, negligence, competition
law…
EXAMPLE: when Mark Zuckerberg first launched Facebook, others claimed that he had stolen their ideas
for social networking sites. They filed a lawsuit against him alleging theft of intellectual property,
fraudulent misrepresentation, and violations of partnership law and securities law. Facebook ultimately
paid million to settle those claims out of court.
Law, morality and society Ho do legal moral and social d ties o erlap
Legal vs moral; legal vs social; moral vs social
Often, legal rights and obligations are distinct from moral rights and obligations
○ Abortion is legalised in many states but many still feel that it is immoral
But sometimes there is an overlap
○ Murder is both illegal and considered immoral by most
So can law be morally justified? → Murder? Abortion? Euthanasia?
○ Depends on who you ask and what side of the debate the person is on
○ Sho ld societ stri e for o erlapping legal moral and social d ties
○
○ Ideally we want the law to reflect social norms which are in turn morally justified which
means that we would expect a perfect overlap between the three which makes
enforcement very easy because the law would be based on the moral and social
standards so society will comply with the legal laws because they find them acceptable
○ Should society strive for perfect overlap?
○ To enact moral duties as legal duties you will have to choose who’s moral duties you
keep ahead you have to pick a side, pick one’s moral condition and impose it on
everyone as a law
○ Differences between legal duties and moral and social duties is that legal duties can be
enforced by the state and there are consequences to violating these legal duties
Classification of law
Law is a general term that econmpases all types of laws national law can be categorized into:
○ Public law: governs relationship between individuals or businesses and the state
■ Criminal law
, ■ Constitutional law issues relating to the British Constitution , Administrative law
civil law issues between individual and state
○ Private law: governs relationship between private parties on both parts
■ Civil law
■ Contract law
■ Law of torts
■ Property law
Distinction between criminal law part of public law and civil law part of private law :
Public law: Criminal law Private law: Civil law
Nature of A criminal case if called a A civil case is called an action or claim
proceedings prosecution
Purpose Retribution Deterrence Compensating a person that has suffered
Rehabilitation injury or loss due to the acts or omissions
of another
Parties The state prosecutes the defendant The claimant the person who has suffered
the accused loss initiates a claim against the defendant
the person alleged to have caused the
loss
Who will initiate A prosecution will be started by Proceedings are commenced by the victim
proceedings? the state in the form of the police person who has suffered damage .
arresting and charging someone. Disputes can also involve wills or family
The victim does not commence matters.
proceedings. The prosecution will
be continued or discontinued by
the CPS layers
Outcome Acquittal: free Claimant plaintiff wins loses the case
Conviction sentence Win a remedy is awarded e.g.
compensation, injunction
Burden of proof The prosecution State Claimant Plaintiff
Standard of proof Beyond reasonable doubt highest Balance of probabilities preponderance of
standard of proof by providing evidence strongest evidence wins
evidence
Examples Murder; theft; sexual offences; Breach of contract; negligence;
terrorist offences. employment law disputes
Loss of a patient by a surgeon
Legal systems
A legal system is the body of institutions that make, execute, and resolve disputes on the law of a
jurisdiction, together with the law they deal with Slorach et al . Two major legal systems:
, Common law
Civil law
COMMON LAW SYSTEMS CIVIL LAW SYSTEMS
Source of laws case law and statute in written documents known as ‘Codes’
Role of the Judges both create and interpret Judges interpret the law in line with the
judiciary law legislature’s intentions
Role of precedent A well established system of No doctrine of binding precedent;
binding precedent In practice, the decisions of ‘higher’ judges
are usually followed
Conduct of Largely ‘adversarial’, with judge as Largely ‘inquisitorial’, with the judge driving
litigation arbiter not in the whole process the process
Examples England Wales, the US, Australia France, Germany, Russia, China, the
Netherlands
Sources of national law the process by which laws come into existence
Legislation
○ Primary legislation act of parliament
■ Acts of Parliament also called statues
■ Made by Parliament
■ Parliamentary sovereignty
Sovereignty: characteristic of an actor in a state who can impose its will
on all the other actors without contrat
Parliament is the supreme law making body in the UK
It has the power to make any statues on any subject matter
British courts are bound to enforce the laws and cannot question their
validity
○ Delegated legislation
■ Made by bodies other than Parliament
■ Power to make delegated legislation is given by Parliament
■ Bodies that are given the power to pass delegated legislation can only pass laws
within the limited power given to them under the enabling Act
■ Delegated legislation is going beyond the power of the enabling Act is said to be
the “ultra vires” and can be invalidated by the courts
■ Advantages:
Saves parliamentary time
Make appropriate format for matters of detail
Can be enacted quickly
Issues of technical nature compiled by experts
Can be amended or repeated easily and equity
