Bus-115 (Business Law): Chapter 2 Guide
Learning Objectives
After reading this chapter, students should be able to accomplish the following objectives:
- List the objectives of the law.
- Clarify the duality of the law.
- Outline the content of the U.S. Constitution.
- Define and explain the use of executive orders.
- Explain the role of statutory law in the legal system.
- Defend the need to set up a system of uniform laws.
- Describe how the principle of stare decisis provides stability within the law.
- Differentiate between statutory interpretation and judicial review.
- Account for the legislature’s need to establish administrative agencies.
- Clarify the nature of the deep state within the American political and legal system.
Major Concepts
2-1 The Purpose and Operation of the Law
The law consists of rules of conduct established by the government to maintain harmony, stability, and justice within a society. Ideally, the primary objectives of the law are to promote harmony, stability, and justice. In everyday life, the balance is not easy to maintain. The law or, more properly, the entire legal framework consists of a series of dualities that must be resolved somehow.
2-2 Constitutional Law
A constitution is the basic law of a nation or state. The U.S. Constitution provides the organization of the national government. Each state also has a constitution that determines the state’s governmental structure. The body of law that forms a constitution and its interpretation is known as constitutional law.
2-3 Executive Orders
An executive order is a device by which the president can act on his own without having to resort to the somewhat cumbersome process of going through Congress. A proclamation is an executive order that addresses the public at large. An order is aimed at a subdivision within the executive branch. A memorandum is simply a suggestion issued by the president to part of the executive branch.
2-4 Statutory Law
The laws passed by a legislature are known as statutes. At the federal level, these are the laws made by Congress and signed by the president. At the state level, statutes are enacted by state legislatures. Statutes must be arranged, cataloged, and indexed for easy reference by compiling state and federal codes. Because many different statutes are passed each year by the 50 state legislatures, there are important differences in state statutory law throughout the nation. One solution to the problem of inconsistent statutory law is for the legislatures of all the states to adopt the same statutes. The Uniform Law Commission (ULC) was founded to write these uniform laws.
2-5 Court Decisions
Courts make law through common law, the interpretation of statutes, and judicial review. Common law is the body of previously recorded legal decisions made by the courts in specific cases. Statutory interpretation is the process by which the courts analyze those aspects of a statute that are unclear or ambiguous or that were not anticipated at the time that the legislature passed the statute, and judicial review is the process by which the courts determine the constitutionality of various legislative statutes, administrative regulations, or executive actions.
2-6 Administrative Regulations
Federal administrative agencies administer statutes enacted by Congress in specific areas, such as commerce, communication, aviation, labor relations, and working conditions. These agencies create rules, regulate and supervise, and render decisions. To help prevent any conflict of interest that could arise from these overlapping responsibilities, Congress passed the federal Administrative Procedures Act. To help small entities deal with bureaucratic red tape, Congress passed the Regulatory Flexibility Act.
