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Part – One
Introduction to Law
1. What is Law ?
Defining law in precise is form is difficult task since
 Law is regarded differently through different theories or school of thought.
(international vs national law; private vs public laws)
 The function of law is always in motion
 Sources of Law
 Content point of view (what law ought to be)
2. Theories of Law
• Natural Law Theory: -
• The word natural is derived from the Egyptian word ‘natare’ it means spirit. And the
word ‘al’ means all related to spirit. For natural law theorists our physical domain is not
different from our spiritual domain. Hence they divide law in to four main subject.
i. Eternal Law : the law designed by God in His grand design and applied on the
Universe. Ex. The sun shine in the day and the moon at night. Ex. Food chain etc
• ii Divine Law : the set of law or principles revealed or
manifested by religious testament. Ex, the ten commandments
• iii. Natural Laws : Laws are part of eternal law and made for
human kind. Ex. A woman to give birth etc.
• iv. Man Made Laws : - these are laws made by human being by
using their intellect so that they fit and accommodate their
actions and activities to the needs and content of different
societies.
Therefore, for natural law theorists whatever man can do in making laws can
not in anyways change the laws of nature. This is because these laws are
not put in place not by human being but by the creator of this universe
irrespective of the fact that we like it or not, we understand it or not or we
accept it or not.
• If we do not alien laws with nature we create chaos or mess.
Ex. Unfair competition through defaming product or
service.
• Hence in determining this alliance between natural law to man
made laws by inclusion of moral ingredient.
• For naturalists ‘morality’ is a connecting factor. Hence morality
is the ingredient or a profound agent that gives validity for law.
• Naturalist concern about what the law should /ought/ to be
rather than what the law is.
• For them we can not separate law from morality. Therefore, if
law conflict with morality then they claim that morality should
win and such law should be rejected.
2. Legal Positivism : -
‘Law is the Command of the sovereign backed by punishment’

• Here laws are ascertained or defined as what they actually exist rather
than as we think it should be. Thus, for them the content of law is
immaterial.
• This theorists recognize human authority rather than eternal or divinal
made of law.
• For positivists the following two pedigrees must mate : -
i. The law should be acted by the correct authority.
ii. The correct authority should follow the appropriate law making
procedure.
Therefore, for them if the law fulfil the above two elements then they claim
that it is valid irrespective of morality.
However, they fail to explain : -
• Who exactly is the sovereign.
• How sovereign decide which law to be enacted and which laws
should not. If it not morality then what it is?
• Where do those laws which ascertain law making procedure are
coming from?
iii. Legal Realism : -
Conceives law as judge made and by doing so it puts the court at
the center.
It contends that positive law cannot be applied in the abstract,
rather, judges should take into account the specific circumstances
of each case, as well as economic and sociological realities.
• According to this theory, rules not put to use to solve practical cases are not
laws but merely existing as dead words and these dead words of law get life
only when applied in reality
• Therefore, judges moral belief, his particular position in the society, his
upbringing and schooling matters most. So does to the positivist realists also
has four pedigrees of thoughts.
i. Law protect powerful economic interest first;
ii. The outcome of the legal dispute is determined by judge’s morality,
perspective personality; judges are not super human and are likely
influenced by their lives.
iii. Since judges are responsible to interpret law, are likely being influenced by
public good;
iv. Since lawyers can predict how judge’s ruling could likely be on certain case
by examining judges’ behavior or past cases they will chose forum whereby
they will be at disadvantage.
Functions of Law (why do we need law?)
The functions of law transcends and transforms through time. Thus there
are many functions of law but the following are general one : -

Regulate and structure relationship among persons

It correct bad or undesired behaviors by providing punishment against who

commit such bad acts.

It may serve as an agent of social transformation Ex. Patent and trade
secret laws

A means of dispute settlement mechanism

Seeking for particular advantage Ex. Taxation and Investment laws

III. Business Law
• Business law also called Commercial Law and it includes bundle of laws
that regulate how to establish, operate and end business.
• Business law applies to trade persons as well as on the activity which is
designated by the proper laws of the land
IV. Source of Business Law :

Parliament (Enactments)

Court Decision

International Agreement

Customs

Scholarly Articles