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CHAPTER 3. Common Law, Statutory Law, and Administrative Law. Click your mouse anywhere on the screen to advance the text in each slide. After the starburst appears, click a blue triangle to move to the next slide or previous slide. Quote of the Day.

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Common Law,

Statutory Law, and

Administrative Law

Click your mouse anywhere on the screen to advance the text in each slide. After the starburst appears, click a blue triangle to move to the next slide or previous slide.

quote of the day
Quote of the Day

Progress everywhere today does seem to come so very heavily disguised as chaos.

Joyce Grenfell, British actor

three sources of law
Three Sources of Law

Common Law

Statutory Law

Administrative Law

common law
Common Law
  • Judge-made law; made up of all the decisions made by appellate courts.
  • Two hundred years ago, almost all law was common law; most new law is statutory.
  • Common law predominates in tort, contract, and agency law; it is important in property and employment law.
  • Based on stare decisis, meaning “let the decision stand” (previous decisions are generally upheld in similar cases.)
  • Incorporates predictability and flexibility.

Statutory Law

  • Most new law is statutory, that is, it is legislation passed by either a state legislature or the Congress of the United States.
  • Citizens who vote have some control over statutory law. We elect the state congressional representatives and the United States Senators and Representatives.
how new laws are made
How New Laws are Made
  • Any member of Congress (Senator or Representative) can initiate a bill, or proposed law.
  • A bill is debated in a committee in the house where it was introduced.
  • From the committee, it goes to the full house for a vote.
  • If it passes both houses this way, it goes to the President for his signature.
  • A President’s signature turns a bill into law.



Conference Committee

Foreign Relations

Banking, Finance, and Urban Affairs

Education and Labor

Judiciary Committee


Judiciary Committee


Aeronautical and Space Sciences

Armed Services

Ways and Means

Armed Services

How New Laws Are Made

If vetoed, it goes back to the Congress, where it must pass both houses by a 2/3 majority.

Once both houses pass the compromise bill, it is sent to the President to be signed.

If signed, the bill becomes law.

If the second House of Congress made any changes, or amendments, to the bill, it must go to a Conference Committee, made up of members of both houses. Here, they work out compromises between the two different versions of the bill. The compromise bill then goes back to both houses for a final vote.

House ofRepresentatives


After it passes committee, the bill goes to the full body of that house for a vote.

If it passes there, it goes to the other house (House to Senate or Senate to House).

It is assigned to a committee and the process repeats.

A bill, or proposed law, is introduced in the House of Representatives or the Senate and then assigned to a committee for discussion and voting.

Major Senate Committees

Major House Committees

statutory interpretation
Statutory Interpretation
  • Sometimes wording is ambiguous, either by oversight, or intentional -- as a compromise.
  • New laws must be interpreted by the courts.
    • Plain Meaning Rule -- the courts must use the common sense definition of words.
    • Legislative History and Intent -- sometimes the court can look to the reasons behind the law to determine the legislators’ intent.
    • Public Policy -- the courts will use accepted social policies, such as reducing crime or providing education to interpret a law.
  • Once the law (statute) has been applied by the courts, its interpretation becomes a precedent to be used in future court cases.
the other player






The Other Player --
  • In today’s political climate, running a campaign for political office is an expensive endeavor.
  • Financial contributions to candidates or political parties come from many sources. Some limits have been placed on contributions, but loopholes exist.
  • Donors usually expect to receive some benefit, such as favored treatment in future legislative issues.
  • Supporters of contribution limits aim to equalize the access to politics for rich and poor; opponents claim that the First Amendment guarantees their right to support whomever they choose.
  • The very green bottom line is, MONEY TALKS -- and it often talks loudly in the political arena!
administrative law
Administrative Law
  • Federal agencies such as the Federal Aviation Agency (FAA) and the Federal Trade Commission (FTC) and the Bureau of Land Management, all have the power to make regulations which affect citizens and businesses.
  • Agencies were -- and are -- created to fulfill a need. Someone needs to oversee changing technologies and practices and their effects on society. An agency is created when Congress passes enabling legislation, which describes a problem and defines the agency’s powers.
  • Agencies often have considerable power in their areas of specialty, sometimes leading to controversy. The Administrative Procedure Act regulates how agencies operate, in an attempt to reduce the controversy.
classification of agencies
Classification of Agencies
  • Executive Federal Agency: Part of executive branch, under the control of the President; usually support the President’s policies.

Internal Revenue Service (IRS)

Federal Bureau of Investigation (FBI)

Food and Drug Administration (FDA)

Nuclear Regulatory Commission

  • Independent Federal Agency: Not part of executive branch; President does not have the power to fire the head of the agency.
  • Are agencies too powerful??

Securities and Exchange Commission

Federal Trade Commission (FTC)

Environmental Protection Agency (EPA)

National Labor Relations Board

Federal Communications Commission (FCC)

power of agencies rulemaking
Power of Agencies -- Rulemaking
  • Two types of rules
    • Legislative rules -- require businesses and people to act a certain way; have the effect of a Congressional statute.
    • Interpretive rules -- these do not change the law; they define or apply the laws to new situations.
power of agencies rulemaking13
Power of Agencies -- Rulemaking
  • Three types of rulemaking
    • Informal rulemaking -- proposed rule must be published and public allowed to comment.
    • Formal rulemaking -- must hold a public hearing before establishing the rule.
    • Hybrid rulemaking -- some elements of both of the above -- perhaps the proposal and comment, with cross-examination, but not a full hearing.
power of agencies investigation
Power of Agencies -- Investigation
  • Voluntary -- Some businesses freely give information and readily comply with agency recommendations.
  • Subpoena -- an order to appear at a hearing and produce evidence, sometimes documents.
    • Must be relevant to the investigation and under the agency’s jurisdiction, or area of authority.
    • Must not be unreasonably burdensome on the business.
    • Must not be privileged; this means that a corporate officer may not be required to incriminate himself.
power of agencies investigation15
Power of Agencies -- Investigation
  • Search and Seizure -- a legal search of a business, in order to take evidence of wrongdoing.
    • Most require a warrant before the search.
    • Some industries are closely regulated and may be searched at any time, with no warning.
power of agencies adjudication
Power of Agencies -- Adjudication
  • Adjudicate -- means to hold a hearing, then decide how to proceed with an issue.
  • Procedures for adjudication
    • A hearing before an administrative law judge.
    • Parties have counsel, but there is no jury.
    • Informal; both sides present evidence.
    • Judge makes ruling on testimony and evidence.
  • If parties are unhappy with results
    • Loser may appeal to an appellate board.
    • Appellate board may make a de novo decision, and ignore the administrative law judge’s decision.
    • Appeals go to a federal court.
limits on agency power
Limits on Agency Power
  • Statutory Control
    • The enabling legislation that created the agency places controls on it through requirements and restrictions.
  • Political Control
    • The President has control over agencies through political pressure and through nominations of agency heads.
    • Congress controls the budgets of agencies. They can eliminate funding for any program or an entire agency.
    • Congress can amend enabling legislation to place limits.

Limits on Agency Power

  • Judicial Review
    • A party injured by an agency decision is entitled to an appeal in a federal court, after all appeal options are exhausted within the agency itself.
  • Informational Control and the Public
    • The Freedom of Information Act (FOIA) -- allows any citizen to request information from an agency.
    • The Privacy Act -- prohibits agencies from giving information about an individual to other agencies without consent. There are some exceptions.
law is complex the subject becomes less baffling if we understand how society creates law
“Law is complex. The subject becomes less baffling if we understand how society creates law.”

Link to the Internet

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