BUSINESS LAW
INTRODUCTION TO LAW
GENERAL CONCEPTS
Definition Of Law:
Although there is no exact definition for the word "law", it may be defined as a code of conduct which controls the activities of people in a given community,
a- towards each other in their private and business lives
b- in their relationship with the state.
Law 's set and enforced by a sovereign political authority. In our modern societies the sovereign political authority is usually organised in the form of "state".
There have been many kinds of sovereign bodies in the past ranging from Chiefs of Tribes, Medieval Kings, Princes and the late form of sovereign bodies is Democracy . In TRNC the sovereign body is the Assembly of the Republic. And in Turkey , The Grand National Assembly, in UK Queen in parliament in US Congress etc.
However, this definition does not cover that part of law which is unwritten and customary. It is said that no nation can survive only without other rules of social conduct which hold its members together and become binding on them by habitual practice. There are also rules of Morality , Ethics, Customs and Religion.
Law, which is recognised and enforced by the courts must be distinguished from the above rules of human behaviour or social conduct. The sanction for a breach of any of these rules is the conscience of the person concerned. In other words, Law is enforced by the external power of the courts, whereas rules of morality, religion or ethics are not.
LAW AND CUSTOMS:
There are other rules of social conduct which are called customs. There may be recognised by the courts if they are referred to by any statute or law. For example , in Cyprus, the Sale of Good's Law allows the Courts in deciding the "merchantable quality" of goods sold, to take into account existing customs among merchants dealing in goods of the same kind.
Many times rules of Law and morality may be the same but not always. For example in many countries in Europe now, homosexual behaviour in private between consenting adults is not illegal although many people would regard it against religion or moral rules.
On the other hand there may be nothing immoral for a person to smoke marijuana in some countries but under the rules of Law it is a very serious crime (offence) punishable by a term of imprisonment in almost all countries of the world.
Therefore, a more precise definition of Law today would be the following: " Law is a body of rules for human conduct within a community which by common consent of that community shall be enforced by external power."
The essential elements required for the existence of Law are the following:
a-There must be a community,
b- There must be a body of rules for human conduct or behaviour within that community
c- There must be common consent of the community that these rules shall be enforced by external force.
Common consent of a community which some jurist may refer as the " common will" of the community defined as follows.
The express consent of an overwhelming majority of its members that those who dissent are of no importance as compared with the community viewed as an entity in contrast to the will of its single members.
Main Characteristic of Law
a- The most important distinction of law from the rules of social conduct is the fact that the law has to be enforced by external power. i.e. courts, police force etc.
b- Law is of general application and permanent in nature. Its rules prescribe directives commanding what is right and prohibiting what is wrong. i.e. "you should pay taxes" (commanding) or " you shouldn't kill or steal" ( prohibitive).
c- Rules of Law whether they are commanding or prohibitive are aimed at justice and prevention of arbitrary use of power both by individuals as well as officials of a State.
This means the law restricts the will of individual as well as the society. Because it is impossible to talk about freedom and liberty of individual in a society where there is no respect for law. By doing this, the law protects both individual as well as the society or state.
Although this may appear to be in contradiction, it shouldn't be forgotten that overall interest of individuals as well as state lies in keeping the balance between absolute liberty of the individual and absolute power of the state which is called sovereignty.
As neither the individual, nor the /state can exist or survive without each other, the role of the law is to act as moderator of the age old conflict between the liberty of individual and the authority of State.
Inevitability and Importance of Law
Law is an important, necessary and inevitable part of social life. In every society, regardless its level of development its culture its political and economic regime there always is a system of law . This fact is expressed in the Latin dictum ubi societas ibi ius which means that wherever here is society here is law. Also relations among societies organised as state as well as the structure and activities of international organisations involve legal aspects and problems.
From cradle to grave every person inevitably come into contact with law and is affected by it almost constantly. When a baby is born he or she has to be registered in the Registries of Birth, Death and Marriage (in Turkey), when a person dies a death certificate has to be obtained before his or her burial because these formalities are required by law.
In applying for a job or to a school in paying taxes in voting in marrying in travelling in driving in buying and selling even in walking in the streets people are subject to law. In times of social unrest within or between societies such as wars and revolutions or natural disasters such as earthquakes or floods the existing legal system may be seriously damaged or broken down. Yet, sooner or later it will either be re-established or replaced by a new legal order or fail and then be eliminated or punished in the name of the legal system against which they had fought.
On the other hand a legal system may not or can not be fully enforced there may be arbitrariness in its applications . Some people may find ways to avoid it or it may be demonstrated that it is a reflection of the socio-economic infrastructure yet it does make itself felt one way or another. Some may wish or hope or predict that legal order at least as a means of coercion should or will disintegrate . It seems, nevertheless, that it will be here to stay for generations to come.
The Necessity For Law
" Bank Clerk Shot"
" Armed Gang Steal Wage Roll"
" Terrorists Bomb Hotel"
" Soccer Fans Run Wild"
" Hi-jakers Kill Hostages"
Headlines such as these are commonplace and their like can be seen in newspapers most days of the week. If there was no system of law the persons responsible for the above events would be under no fear of punishment or sanction by the State or community in general. Murder is considered by modern society to be a terrible offence. therefore. it is essential that there is an established procedure for providing that murder is a crime and that murderers will be punished. It is essential in a civilised community that there is a clearly defined criminal law which may be enforced and a system of law for determining commercial and Private disputes and providing a means of compensation for injured parties.
If community did not have system of law which was capable of being enforced he strongest person or group of persons could dominate with arbitrary and unfair rules or there could be anarchy with no form of establishment and individuals following the dictates of their own conscience. If a community is to develop as a fair and free society law must be present to ensure that and individual's right and freedoms are protected. As a community develops its industry and business , its law must similarly develop and create a system which will ensure that transaction may take place with reasonable certainty, that disputes will be settled and that breaches of law will be enforced or compensated. It ›s not a coincidence tat as business in the world has developed over the last 100 years, so has mercantile and company law and the law dealing with insurance revenue and taxation consumer protection industrial relations and similar matters.
Law is not only needed to ensure that offenders will be punished it creates a code of conduct which a community wishes to follow. The Factories Acts created laws to protect workers from injury by placing a duty on an employer to provide a safe place of work. Drivers of motor vehicles are required to be insured, so that a third party injured in an accident will be compensated for any loss suffered. Shopkeepers have to refund the cost of goods which customers return because they are not of merchantable quality.
A community has its own values and its law should reflect these values. Laws are not made to be broken but to be followed.
All breaches of civil or criminal law are not necessarily deliberate. The examples mentioned above could result in a breach of law which was not intentional; an employer may have created a dangerous place of work by accident a motor car accident could have been caused by the negligence of the driver, and a shopkeeper may not have known that the goods were unsatisfactory. Yet all there may have committed an offence or a breach of law. There have been breaches of law because the community created the laws and requires individuals to behave or conduct themselves accordingly for the benefit of the community as a whole.
The Main Legal Systems:
If we leave aside the great systems of Hindu and Islamic law, the modern world may be divided into two main both groups of legal systems, the common law countries which comprise the English-speaking world and territories which have formed part of the British Empire and Commonwealth and the civilian countries which include continental Europe and many other even Oriental-states which have, with westernization, adopted accidental codes of law, like Japan and Turkey. To a greater or lesser degree, civilian systems stem from Roman Law, or rather revived Roman Law. Some jurists add to legal systems mentioned above the one of the socialist countries which greatly affected the former Eastern European countries. The socialist law also accelerated the development of International Law in many aspects. The main characteristics of some of these legal systems are briefly explained below.
I- Roman Law
Roman Law was the legal system developed and applied in the ancient Rome and the Roman Empire. As we noted above it is called civil law. One reason for this is the fact that the main tenets of the Roman Civil law are complied by Emperor Justinian and his successors in a series of treaties collectively called the Corpus Juris Civilis. i.e. the basic principles and rules of the Roman civil law. Off course Roman law did not consist only of civil or private law i.e. the legal rules regulating rights, obligations and relations of private persons and procedures of litigation concerning civil law cases. Along the civil law there also was a public law pertaining the organisation and functions of the Roman State. Thus, one of the basic characteristics of the Roman law is the division between ius privatum (private law) and ius publicum (public law) . But the part of the Roman law later affected the legal systems of many countries has mainly been its private or civil section.
Corpus Juris Civilis was coplied in the Sixth Century AD During the next five centuries the Roman law had been neglected and had no impact outside of Byzantium “its second life began with the use and study of Justinian’s work in the Italian Universities of the eleventh century AD which spread thereafter throughout Europe influencing the development of judicial terminology and though and of the municipal (national) legal systems of Europe down to the period of codification, with the French Code Napoleon ( The French Civil Code prepared with the directive of the Emperor Napoleon Bonapart) of AD 1804.”
Today, the legal systems of many countries are based on the Roman law tradition. All Europe with the exception of England, all of central and South America, Philippines, Japan and Turkey may cited here.
The basic characteristics of the Roman law system may be summarised as follows:
· As we mentioned above in this system the law is divided as public and private law.
· The legal rules are essentially in the form of written laws, codes and regulations. This means customs and the court decisions play a limited role as parts or sources of law.
· Many of the basic legal principles, institutions and concepts have their origin in the Roman law and frequently expressed in Latin. Here are some examples:
· Pater is est quem nuptiae demondstrandt (the father of a child is the husband)
· Pacta sunt serverda ( Parties to an agreement must observe its clauses)
2-Common Law
As Roman law developed originally in the ancient Rome, the common law came into being in the medieval England. It is the product of the actions of courts. This means that in the case of common law the main source of the legal rules in force had been the decisions of the courts and not the written laws. To explain its nature we may give the following account for common law.
As we have noted earlier, historically legal rules developed mostly in the form of customs. Customs are unwritten rules of social conduct which come into being out of practice in various areas of communal life. Those customs which persist over long periods of time eventually become unwritten legal rules and thus observed in social activities and relations they regulate. Most of the customs have been replaced in the course of history by written legal rules in the form of laws, codes, regulations etc. But even today in various areas of national and international life there are customs which are legally recognised and enforced. Customs having the nature of legal rules are called customary law. As in other societies in the Anglo-Saxon England before the Norman Conquest (1066 A.D.) many of the social relations had been subject to customs which were administered mostly by the local courts. After the Norman rule was established most of these customs continued to be observed by local courts but they eventually lost their importance and a centralised judicial system supplanted them. The English common law had been developed originally by the decisions of the judges in these centralised courts. That is why sometimes it is also called as "judge-made law". These courts in deciding the cases which were brought before them based their rulings on the local and general customs, on precedents i.e. previous decisions of the same or other courts for similar cases and on the opinions and interpretations of the judges. Thus, the decisions of the courts became applicable in all similar cases. For cases which could not be resolved on the basis of existing customs or by referring to precedents (i.e. previous court decisions), the courts found solutions of their own. Consequently the English law developed as the established decisions of the courts which became legal rules to be applied uniformly in the whole country. Since these rules came into being by the rulings of the courts for the cases taken by them they are also called as "case law". "A different usage of the term common law comes into play when we distinguish among the legal systems of the various nations. Among the Western countries we distinguish between the common law nations and the civil law nations. In this context the common law nations are understood to be countries deriving their legal systems from the English model, though in such countries today considerable portion of the law is, of course, embodied in statutes. the civil law countries, on the other hand are those deriving their legal traditions, concepts, and vocabularies from ancient Rome. Such countries, it happens, are today characterised by comprehensive codification’s, legislatively imposed, from which in theory at least the courts derive all the rules by which cases are decided. A civil law country (sometimes called a country of the modern Roman law) does not, generally recognise judicial decisions as being of themselves an original source of legal rules. Roughly speaking among the western nations the common law countries are the English speaking nations, while the countries of the civil law are those where the prevailing language is not English, but is usually one of the modern derivatives of Latin. Naturally, as with all such distinctions, there are anomalies; for example, a small pocket of civil law maintains itself with moderate success today in Louisiana (USA)" .