Business law: Introduction

Business law: Introduction

The Role of the Commonwealth Constitution

—  What is the purpose of a Constitution?

—  It regulates how a country is governed

—  It defines the law-making powers of the Commonwealth and States.

—  It sets out some basic rights (eg Freedom of Religion) – though not enough to call it a Bill of Rights.

—  Where a law is inconsistent with the Constitution, or goes beyond the legislative powers set out in the Constitution, the High Court can strike that law down.

Commonwealth Constitution

—  What does the Commonwealth Constitution do?

—  Chapter 1 – Parliament

—  Chapter 2 – The Executive Government

—  Chapter 3 – The Judicature

—  Chapter 4 – Finance and Trade

—  Chapter 5 – The States

—  Chapter 6 – New States

—  Chapter 7 – Miscellaneous

—  Chapter 8 – Alteration of the Constitution

FEDERAL SYSTEM

—  Upper House

—  Lower House

—  Executive = Ministers + Gov General

—  Judiciary (Federal, Family + HC)

NSW

—  Upper House

—  Lower House

—  Executive - Ministers + Premier

—  Judiciary - Local, District, Supreme + HC

Westminster System

—  Each of the arms of government, in performing their roles, can make laws

—  Roles:

—  legislative arm – makes laws,

—  administrative arm – administers laws,

—  judicial arm – interprets laws

—  Legislative arm – makes legislation

—  Administrative arm – makes delegated legislation

—  Judicial arm – makes case-law

The Doctrine of ‘Separation of Powers’

—  What does this mean?

—  The same person should not form part of more than one of the three organs of government

—  One organ of government should not control or interfere with the functioning of another organ

—  One organ should not exercise a function appropriate to another organ

—  Plaintiff S157/2002

a. The Problem With a Federal System of Government

—  Two governments can make laws relating to one group of people

—  Solution?-divide law-making powers between the two governments

b. How Are Powers Divided?

—  Exclusive powers (Commonwealth only)

—  Commonwealth territory and public service (s.52)

—  Customs and excise (s.90)

—  Defence (s.114)

—  Coining money (s.115)

—  Concurrent powers (Commonwealth and States)

—  S.51

—  Residual powers (States only)

—  E.g.hospitals, education, police

d. What if There is an Inconsistency?

—  S. 109 Constitution

—  When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid.

f. Expansion of Commonwealth Power

—  How?

—  S.96 of the Constitution allows the Commonwealth to make conditional grants

—  The Engineer’s Case (1920) 28 CLR 129 decided that all Commonwealth powers in s.51 should be given their widest interpretation possible

—  S.51(xxxix) (incidental power) gives the Commonwealth the power to make laws incidental to the rest of the powers in s.51

g. How Can the Constitution Be Changed?

—  Under s.128 of the Constitution the proposed alteration must be passed by an absolute majority of each House of Parliament

—  Referendum- there must be a majority of voters in a majority of States agreeing to the proposed alteration (the double majority)

THE MAKING OF LAW IN AUSTRALIA

1. Case Law

—  1. The Concept of ‘common law’

—  What does the term ‘common law’ mean? Depends on the context in which the word is used.

—  1. Australia is a common law country, i.e. it has a Westminster system of government

—  2. Common law meaning case law, i.e. the system of precedent

—  3. Common law as opposed to equity, i.e. there are two separate body of rules that are used by the courts in judicial decision-making

2. What Is Equity?

—  Equity developed because the system of common law (the writ system) was considered to be too rigid

—  The King’s Courts v The Courts of Chancery

—  Equity was based on the concept of fairness. Eventually rules were established in the courts of equity

—  Eventually the different courts, dispensing common law and dispensing equity were fused (n.b. this did not have to occur in NSW)

—  Why is equity important?

—  Different remedies are available at common law, e.g. damages, as opposed to equity, e.g. injunction

—  Judges in equity have a great deal of discretion in making orders

3. The Doctrine of Precedent

—  Definition of precedent:

—  Once a decision has been made on a certain question it must be decided in the same way by all other courts of inferior rank within the same legal system. It is the development of rules to decide future cases. Judges must take account of what has already been decided in their own decisions

—  ‘Stare decisis’:

—  ‘keep to what has already been                decided’

S: 1 of the Motor Vehicles Act 2018 (NSW)

—  Residents of the state of NSW who are current provisional licence holders are prohibited from using a motor vehicle between 11PM and 6am Monday – Friday

—  Penalty – 5 penalty Units

Types of Precedent

—  A. Binding:

—  A decision must be followed irrespective of what the judge applying the decision thinks of the decision

—  B. Persuasive:

—  A judge is not bound to follow a decision but may do so if he or she approves of the reasoning and soundness of the decision

Concepts

—  C. Ratio decidendi:

—  The reason of the judicial decision. It is the legal principle on which a judgment rests

—  D. Obiter dicta:

—  A saying by the way. It is those parts of the court’s decision that are not essential to the judgment

Problems With Finding the Ratio Decidendi

—  The judgment may be badly reasoned

—  The ratio may not be clearly stated

—  The stated explanation might not support the conclusion

—  How explicitly and forcefully was the principle stated?

—  How widely and frequently has the principle been applied?

—  The status of the court and the judges propounding the principle is relevant

—  Has the principle been well accepted by the public, by practitioners, by academic lawyers?

—  Was the principle unanimously stated, affirmed or applied? (the problem with more than one judge on the bench)

—  Were all the relevant arguments brought up in the case?

—  How cogent was the reasoning behind the principle?

—  A judge may give more than one reason for his or her decision

—  There may be two sets of facts relating to separate issues

4. Rules of Precedent

—  a. The decisions of higher courts are binding on all lower courts in the same judicial hierarchy

—  b. The decisions of lower courts are not binding on a higher court in the same hierarchy

—  c. Courts are not bound by decisions of cases from courts outside their hierarchy (these are persuasive precedents)

—  d. Judges on an equal level do not have to follow the decisions of other judges on the same level but may choose to do so in the interests of consistency

—  e. Superior appellate courts can refuse to follow their own previous decisions but are reluctant to do so

—  g. Lower courts do not have to follow the obiter dicta of a higher court

5. What Is Necessary To Make Precedent Work?

—  1. Law Reports

—  All citizens need to be able to find the law
Official law reports v unofficial law reports

—  The new importance of the Internet

—  Useful websites:

—  www.austlii.edu.au

—  scaleplus.law.gov.au

—  www.lawlink.gov.au

—  2. A Hierarchy of Courts

—  Again, this is essential for the concept of precedent to work, e.g. decisions by courts higher in the hierarchy are binding on courts lower in the hierarchy

—  The value of authoritative decisions by higher courts

The Mosaic of courts in the Australian Federation

“In Australia today, the court structure is a complex mosaic, in which the courts may be characterised by whether they are State or Federal courts, whether they are general or specialist courts, and whether they have a general or limited jurisdiction” – P Parkinson, Tradition and change in Australian Law p 155.

6. Essential Things in a Case

—  A. The material facts (the story that explains the issue)

—  B. The legal issue (what was the legal problem that the court had to solve)

—  C. The ratio decidendi (the legal rule that is going to help the court decide the legal issue)

—  D. The actual decision

7. The Process of Legal Reasoning

—  1. Look at a new case. Is it similar to another case (are the facts similar?)

—  2. Is there a proposition in the old case. Can it be made into a legal principle?

—  3. Apply the rule of law from the old case to the facts in the new case

Terms

—  A. Distinguishing:

—  When a court will not follow the decision of a binding court because of some perceived difference in the facts between the two cases

—  B. Overruling:

—  A superior court stating that a previous decision was a wrong statement of law and should no longer be regarded as authoritative

—  C. Disapproving:

—  Following a decision because one is bound to without agreeing with the case and whilst criticising the case

—  D. Following:

—  Applying the decision of a case in a decision

—  E. Per Incuriam:

—  A decision wrongly made because the judge was not aware of all the relevant precedents or applicable legislation

Usefulness of Precedent

—  Certainty:

—  Once a decision is made by a court citizens will know that the law will be followed

—  Flexibility:

—  Judges always have to make a decision. New situations will always be solved

—  Precision:

—  There are so many decisions that guidance will nearly always be given by a decided case

Disadvantages of Precedent

—  The amount of law:

—  The number of decisions are constantly expanding

—  Uncertainty and cost:

—  No certainty until the highest court has decided