ODISEEWhat is Law(2025)STUDENT 2.pdf

# Course introduction and objectives This section introduces the course, its structure, assessment methods, and the primary goal of equipping business professionals with essential legal knowledge [3](#page=3). ### 1.1 Course overview and structure The course utilizes the textbook "Business Law" by Ewan MacIntyre (9th edition). Students are advised to regularly check Toledo for updates and supplementary materials. Classes are scheduled for Wednesdays and Fridays, with specific timings for Group 1 (Wed 1:30-3:30 PM; Fri 3:30-5:30 PM) and Group 2 (Wed 3:30-5:30 PM; Fri 1:30-3:30 PM) [4](#page=4). ### 1.2 Assessment guidelines The course assessment comprises a midterm test, accounting for 30% of the total grade, and a final exam, contributing 70%. Both assessments are "Bring Your Own Device" (BYOD) and closed-book, meaning no study aids are permitted. The format includes multiple-choice questions (without penalty for guessing), fill-in-the-blanks, and short answer questions. The midterm test is scheduled for Tuesday, November 4th, at 8:30 AM. The final exam date will be announced on Toledo [5](#page=5). ### 1.3 Rules of the classroom The classroom environment is designated as a safe space. Students experiencing a difficult day are encouraged to inform Professor Gardner before class and will not be called upon. Feedback regarding the classroom environment is welcomed [7](#page=7). There are no such things as "stupid questions," and students are encouraged to ask them during class or via email to Professor Gardner. Promptness is expected, and students anticipating lateness should inform Professor Gardner in advance via email, recognizing that "time is money" [8](#page=8) [9](#page=9). Professional courtesy is paramount; students should avoid interrupting others during discussions. When attending online, students should use the hand-raising function or the chat, ensuring all communication is professional and on-topic [10](#page=10). Students are expected to be prepared for class, ready to participate and share their thoughts. In online sessions, students should be able to unmute their microphones and are encouraged to turn on their cameras when speaking. Unless otherwise directed, students should have their textbooks readily available for reference [11](#page=11). ### 1.4 Course objectives The overarching goal of this course is not to transform students into lawyers. Instead, the objective is to develop students into better business persons by cultivating a "legal edge". This involves gaining a stronger understanding of the legal principles that govern international business [13](#page=13). This "legal edge" in the business environment means: * Being sensitized to legal issues [14](#page=14). * Possessing awareness of the legal perspective in business decisions [14](#page=14). * Understanding how to leverage the law to create value and gain a competitive advantage [14](#page=14). * Being informed about potential legal conflicts [14](#page=14). * Knowing how to avoid legal problems and recognizing when to seek professional legal assistance [14](#page=14). * Improving working relationships with legal counsel by knowing how to ask the right questions [14](#page=14). --- # Understanding the nature and definition of law The fundamental nature and definition of law are explored, focusing on its role in providing societal stability and predictability by regulating personal and business conduct [15](#page=15) [17](#page=17). ### 2.1 The purpose of law The primary purpose of law is to regulate conduct within society, thereby creating stability and predictability. This is crucial at both the personal level, where citizens need to distinguish between right and wrong, and the business level, where a degree of "legal certainty" is required for dealings. For international businesses, questions about the reliability of counterparties, what happens when deals go wrong, the likelihood of litigation, and the legal standing of agreements are all profoundly impacted by legal considerations. The simple question of what is legally right and wrong from an international business perspective, however, yields a complex answer: "It depends" [17](#page=17) [18](#page=18) [19](#page=19) [20](#page=20). ### 2.2 The evolving nature of law The legal environment is not static; it is highly dependent on the particular country and the specific historical moment. Law has evolved significantly throughout history, adapting to societal changes and incorporating various influences. This evolution can be traced through different stages, including [21](#page=21) [22](#page=22): * Nomadic tribes [22](#page=22). * The Code of Hammurabi (Ancient Babylonian) [22](#page=22). * Greek concepts of democracy [22](#page=22). * The Roman Code [22](#page=22) . * Early Common Law courts [22](#page=22). * The Napoleonic Code [22](#page=22). * Modern laws and court decisions [22](#page=22). ### 2.3 Law's relationship with values and beliefs Law reflects the values and beliefs of a society or its ruling group. There is a close relationship between morality and any rule that a society chooses to enforce. In the international business context, understanding the current legal environment requires considering society's prevailing attitudes, recognizing that laws can sometimes lag behind societal changes, and identifying noteworthy trends [23](#page=23) [24](#page=24). > **Tip:** When conducting international business, always research the specific legal framework and societal values of the target country, as these are fundamental to understanding what is legally permissible and expected. --- # The role of law in international business The legal environment is a critical factor influencing international business decision-making, encompassing rules that govern relationships between individuals and entities across national borders and defining how legal disputes are resolved [25](#page=25) [28](#page=28). ### 3.1 How the legal environment affects business decision-making International business persons must consider how local legal environments will impact their operations and decisions. Key questions include the degree of predictability within a legal system and the potential business implications of various laws. It's important to recognize that a single business decision can be affected by numerous different laws [25](#page=25). > **Tip:** Understanding the legal landscape of potential host countries is as crucial as evaluating market opportunities or logistical feasibility. #### 3.1.1 Case study example Consider Acme Garment Manufacturing Company, a Belgian firm looking to expand overseas by building a factory to produce women's leisure wear primarily for the US market and employing 500 local workers. The choice of country for this factory will be heavily influenced by the laws of those nations, affecting aspects like labor regulations, property rights, and taxation. For instance, a country with stringent labor laws might increase operational costs for Acme, while one with favorable investment incentives could be more attractive [26](#page=26). ### 3.2 International private law International private law, also known as "Conflict of Laws," is a set of rules or procedural law that governs relationships between individuals or entities of different nationalities. It determines which legal systems and the laws of which jurisdiction will apply to a legal dispute that involves parties from different countries [28](#page=28). ### 3.3 International law International law comprises transnational rules used by national courts to regulate three primary relationships: between two nations, between a nation and an individual, and between persons or entities from different countries. Its sources include international conventions and treaties, customs and general practice, widely accepted general principles of law, and other sources common in national law such as judicial decisions and scholarly writings [29](#page=29). > **Tip:** While international law governs relationships between nations, international private law is crucial for businesses dealing with cross-border transactions and disputes between private parties. ### 3.4 Distinctions between civil law and common law systems Legal systems worldwide can be broadly categorized into civil law and common law traditions, each with distinct characteristics that influence legal practice and business operations [30](#page=30) [31](#page=31). #### 3.4.1 Civil law system The civil law system, often referred to as the "Continental European Approach," is the oldest and most influential legal system globally. It is rooted in the Roman-Germanic tradition and relies on codified law. Legal rules are systematically laid out in comprehensive codes and accompanying statutes, covering areas such as family law, property law, succession law, law of obligations, commercial law, labor law, and criminal law [30](#page=30). Countries that predominantly follow the civil law tradition include Argentina, Brazil, China, Egypt, Germany, Italy, Japan, Mexico, and Poland, among others [32](#page=32). #### 3.4.2 Common law system The common law system, known as the "Anglo-Saxon Tradition," bases its law on court decisions rather than formal codes. Law is developed and pronounced by courts on a case-by-case basis, establishing legal precedents. The principle of *stare decisis* (stand by the decision) is fundamental, requiring courts to follow their own precedents and binding lower courts within a jurisdiction to the determinations of the highest court [31](#page=31). Prominent common law countries include Australia, India, the United Kingdom, and the United States. Canada and South Africa are examples of countries with mixed legal systems influenced by both traditions [32](#page=32). > **Example:** In a common law system, if a dispute arises over a contract term, a judge would look at previous court rulings on similar contract disputes to interpret the current case. In a civil law system, the judge would primarily refer to the codified civil code provisions related to contracts. #### 3.4.3 Influence of legal systems on business The legal system of a country significantly shapes its business environment. Businesses operating internationally must understand these differences to navigate contractual agreements, dispute resolution, and regulatory compliance effectively. For instance, the emphasis on precedent in common law systems can lead to more detailed and nuanced legal advice based on case law, while civil law's reliance on codes might offer a more straightforward, albeit less flexible, framework [30](#page=30) [31](#page=31). #### 3.4.4 Identifying your home country's legal system Reflecting on your home country's legal framework will reveal whether it is primarily influenced by common law or civil law principles. This understanding is crucial for any international business endeavors [34](#page=34). --- ## Common mistakes to avoid - Review all topics thoroughly before exams - Pay attention to formulas and key definitions - Practice with examples provided in each section - Don't memorize without understanding the underlying concepts

| Term | Definition | |------|------------| | Law | A system of rules created and enforced through social or governmental institutions to regulate behavior, with its precise definition often debated but generally understood to bring stability and predictability to society. | | Legal Certainty | The degree of assurance that business dealings and personal interactions are governed by clear, predictable, and enforceable rules, allowing individuals and entities to make decisions with a reasonable understanding of the potential outcomes. | | Common Law | A legal tradition originating from Anglo-Saxon customs where law is developed through judicial decisions and precedents rather than comprehensive codes, emphasizing the principle of stare decisis. | | Civil Law | A legal system, often referred to as the Continental European approach, that is primarily based on codified law derived from Roman law, with legal rules systematically organized in comprehensive codes and statutes. | | Precedent | A legal principle established by a court decision that serves as a rule or guide for deciding subsequent cases with similar issues; in common law systems, it is binding on lower courts. | | Stare Decisis | A Latin legal principle meaning "to stand by things decided," which mandates that courts follow the precedents set by previous decisions of higher courts within the same jurisdiction. | | International Business Law | The body of rules and principles that govern commercial and financial transactions between entities or individuals from different countries, encompassing various areas of law. | | International Private Law | Also known as Conflict of Laws, this is a set of procedural rules that determine which legal systems and which jurisdiction's laws will apply to a legal dispute involving parties from different nationalities or elements of foreign origin. | | International Law | A system of treaties, conventions, customs, and widely accepted general principles of law used by national courts to regulate relationships between nations, between a nation and an individual, and between private individuals or entities from different countries. | | Codified Law | Laws that are systematically arranged into a comprehensive written code or set of statutes, which forms the primary source of law, characteristic of civil law systems. | | Legal Edge | The development of a keen awareness and understanding of legal issues and perspectives within a business context, enabling better decision-making, value creation, and competitive advantage. | | BYOD | Bring Your Own Device; a testing format where students are permitted to use their personal electronic devices to complete the assessment, adhering to specific guidelines. |