Foundations of Business Law

1. Contractual Agreement (simple partnership) between Company 1 + Company 2

2. Sales Agreement between Purchaser and both Companies

1. Contractual agreement (simple partnership) betweeen company

2. Each company posseses 50% of a new company

3. Purchaser concludes Sales Agreement with new company (claim for damage against new company aswell)

1. McDonald's (Franchisor) concludes Franchising Agreement with Franchisee

2. Franchisee concludes Sales Agreement with Customer

(McDonalds, Subway, Migrolino etc.)

1. Licensor (patent owner) grants rights to use invention through license agreement to Licensee

2. Licensee concludes Sales Agreement with Customer

General Rules:

• Owner has to bear the risk of accidental destruction or damage (“The risk lies where it falls”)
• Exception based on statutory provisions, jurisdiction or contract: liability of the injuring party

Function of Tort Law:

• Compensation of damage
• Preventive function
• Punitive function (only in common law countries)
• Enable dangerous but useful conduct (e.g. operation of railways)

- Damage

- Causation (In fact, legal causation)

- Unlawful act

- Fault

-Injuring party must put the injured party in the position it would have been without the tort  (without compensation for personal suffering)

- Pecuniary

• Costs for medical treatment
• Expenses for repair
• Loss of earnings

- Punitive

• Only in case of intent or gross negligence
• Not in Civil Law countries

In Fact:

• Injuring party’s breach of duty must cause the damage/injury; factual matter

Legal:

• The injury must be a legal or proximate consequence of the breach of duty/foreseeability
• Is it fair to hold the defendant accountable for the injury?

• Breach of Duty > other event > other event > Accident

  Question: is there a connection between the accident and the breach of duty?

- "Any deviation from prudence or duty resulting from inattention, incapacity, perversity, bad faith, or mismanagement”

> Any wrong doing commitet out of negligence (Vernachlässigung) or intent

- Negligence: Failure to exercise the standard of care that a reasonable person would have been able to

> gross negligence: failure to exercise basic and simple precautions

- Contributory negligence:

• Plaintiff failed to take reasonable care for his safety or property
• Both plaintiff and defendant are negligent
  > damage proportionally reduced

- Voluntary assumption of Risk:

• Plaintiff assumes risks linked to a certain activity such as football
  > liability excluded

- Self defense

-Consent of the plaintiff

- Liability wihtout fault: "wrongdoer" liable without fault

- Strict liability for dangerous activity: operator of nuclear plant, property owners etc.

- Strict liability with reversal of evidence: liable person may provide evidence that he acted diligently (fleissig, sorgefältig)

-Strict liability without proof of care/diligence: Exception: liability without possibility of such evidence

- liability is based on the individual fault of the injuring party

• someone may be held responsible for the injuries of a third party, such as an employee >
  close relationship
• Precondition is that the employee committed the injury in the course of the work for his employer
• a form of strict liability
• Swiss law: employer may proof that he has chosen, instructed, supervised the employee with due care

• Proof of negligence of the manufacturer
• Liability based on contract v. liability based on tort

important for:

• Any company manufacturing products
• High liability exposure
• Implementation of processes to avoid production of defective products/product monitoring

1. Sales agreement between Manufacturer and Importer

2. Sales agreement between Importer and Seller

3. Sales agreement between Seller and Customer

4. e.g. Product Defect > Customer has a claim based on warranty against Importer and Manufacturer (not Seller)

- payment in case of claims

- Injured party may claim damages based on contract or tort

• Waiver of liability in contracts

• Disadvantage if claim based on tort

Relationship between private persons

• Family law
• Law of succession
• Law of property
• Law of contracts
• Commercial law
• Law of cooperation
• Tort Law
• Trust Law

Acts and behaviour of the state

• Constitutional law (rules over the organization of the state including fundamental rights)
• Criminal Law (prohibiting, punishing, prosecuting certain offensive behaviour)
• International Law (relation between states themselves

Constitutional Law:

• How the government works in election
• In parliamentary procedure
• And the division of power between different arms of government
• Human right values
• Democratic core principles

International Law:

• Relation between nation states

Criminal Law:

• Guilty mind -> guilty act
• Guilty act = offense
• Guilty act can be committed if you are insane or under drugs
  • Punishments: imprisonment, fines, community service

- Civil law (CH+most of Europe):

• Made by the parliament and the government
• Judges merely interpret the laws in the individual cases

- Common law (USA+UK)

• Stare decisis or precedent were the major innovation
• Judged make the law – what is just and fair
• Judges must decide their cases similar on how other courts have done it
  • Analyse old cases
• Precedent = statement by the judge in deciding a case

• to attain a deeper knowledge of the legal systems
• to perfect the legal systems
• possibly, to contribute to a unification of legal systems, of a smaller or larger scale (cf. for instance, the United Nations treaty on the international sale of goods)

• Independent courts
• Representative parliament
• The military
• Police
• The bureaucratic organisation
• Civil society itself

• If someone has the total power, this person will abuse the power
• Because of that they advocated the separation of power (Gewaltentrennung)

- The judiciary (court system) has to apply the law and make sure that the legislative and the executive of the state act according to the law

- District court, first instance court

• Representative government (Bundeshaus, Kremlin, etc.) =means that the people vote for political decision makers to pass the laws of the country
• Most parliament are bi-cameral – two chambers

- Representatives of State (Bundesräte) usually elected by parliament

- States where security/excecutive is ordered by military and police (Afghanistan, Somalia, etc.)

• Freedom of Speech
• Freedom of Association
• Liberty of Press

• natural law is a general rule, found out by reason, by which a man is forbidden to do that which is destructive of his life
• This theory asserts that there are laws that are immanent in nature
• Everyone recognizes what is just and fair
• People often argue with the natural law against oppressive government
  • Mahatma Gandhi British colonial rulers

Thomas Hobbs:

• a natural law practitioner, he set up 9 laws of nature

• Laws are rules made, whether deliberately or unintentionally, by human beings
• There is no connection between the validity conditions of law and ethics or morality. A law can be immoral and still be valid and enforced

• A natural law jurisprudence would say that this law is legally deficient
• An unjust law is no law in the eyes of a naturalist and so doesn’t need to be obeyed

- Administrative rulings

- precedents which address the legal right of, and restrictions on, working people and their organizations

- mediates aspects of the relationship between trade unions, employers and employees