Understanding the Role of Law in Society and Business

Posted on Dec 13, 2024 in Law & Jurisprudence

What is the Role of Law?

Law plays several crucial roles in society, including:

The orderly resolution of conflicts arising between group members and the prevention of their occurrence.
The incorporation of certain values into the relationships established by such members.
The establishment of a legal framework within which not only individuals but also those in power must operate.

Law and Conflicts Among Members of the Group

A simplistic definition would state that law serves to resolve controversies that arise within cohabitation. Human groups give rise to disputes, quarrels, and fighting every day. Taking the law into one’s own hands would destroy society itself. Arbitration already existed in ancient societies, where arbitrators decided according to their conscience and not through the application of legal rules. Then came the figure of the judge, although article 402 of the Civil Code (CC) maintains the arbitral institution, and Article 1820 CC provides for the possibility that some people may entrust the decision of their disputes to a third party. The essential difference between the decision of a referee and that of a judge is that the latter is binding under mandatory law.

Law not only resolves conflicts but also anticipates them, as it provides legal certainty for citizens to know beforehand the consequences of their actions.

Law and the Provision of Social Values

The initial assertion that law orders social relations implies that [the law] should project onto society the values of justice, i.e., it should be a just law. This requirement led to radical positions such as that of unjust law is not law. According to Saint Augustine, “there is no law that is not fair.” Saint Thomas Aquinas developed the doctrine of resistance to unjust law. This thesis is indefensible today, since no law is completely fair because laws are made by men. Law is always law regardless of the justice or otherwise of its prescriptions. The Socialist Group is expected to change channels in democratic systems.

Apart from the value of justice, it must also incorporate equality, meaning that laws apply to everyone without distinctions or privileges; Article 14 of the Spanish Constitution states that “Spanish people are equal before the law (…).” Law should also carry the value of morality, referring to social morality, not religious morality. This morality is modified as times change, and law should adjust in parallel to changes in social morality.

Law Models the Structure and Dynamics of the Group

No law can change rapidly and immediately. Karl Schmitt speaks of risk for motorized and orthopedic legislation for two main reasons:

Danger to the legal security of citizens.
Risk that the legal system as a system will be altered.

Therefore, reforms should only be carried out when their need is obvious and immediate, and their impact on the system should be evaluated. Usually, reforms are more frequent in lower-level standards. Law can anticipate social change by creating rules that induce particular behavior (e.g., savings) or penalizing, for example, an offense that is becoming more frequent. In short, law plays the role of shaping the group’s structure and dynamics by directing the channels of justice and the common good.

Law Creates a Legal Framework for the Exercise of Power

In any organized human society, there is an indispensable factor for its existence: the power that wields the ability to command and is the depository of force. Throughout most of history (except for periods in Greece and Rome), power was exercised by the monarch in the form of absolute power. In the early 16th century, the notion of the state began to be introduced by Machiavelli. However, it was Bodin who provided the essential concept of sovereignty, that is, that there is no other power above it.

In the 19th century, liberal ideology brought about the concept of the rule of law, which mandates that not only individuals are subject to the law but also the state itself. The essence of the rule of law is that it recognizes the state’s ownership of power and strength, but these are controlled by law. With the rule of law, the human person takes center stage and is no longer a subject but becomes a citizen, i.e., one who is not liable to power but who has the power to control it. The rule of law can only truly function in a genuinely democratic political system. According to Legaz, “the rule of law is one that performs a certain conception of justice (…) This conception of justice is personality. It is respect for the values of the individual that characterizes the rule of law.”

Section 117.1 of the Constitution states, “Justice emanates from the people and is administered on behalf of the King by judges and magistrates of the judiciary, who are independent, irremovable, liable, and subject only to the rule of law.” Section 117.5 establishes the principle of jurisdictional unity as the basis of the organization and functioning of the courts.

Different Kinds of Jurisdiction

Civil Jurisdiction: Delivers judgments in private law matters. The civil process is governed by the Law of Civil Procedure of February 3, 1881.
Penal or Criminal Jurisdiction: Involved in criminal cases for criminal acts. Regulated by the Law of Criminal Procedure of September 14, 1882.
Contentious-Administrative Jurisdiction: Its competence lies in disputes in which the Administration is a party.
Employment Tribunal: Deals with disputes in labor relations.
Military Jurisdiction: Deals with crimes committed by military personnel.
Canon or Ecclesiastical Jurisdiction: Deals with marital causes or disputes between Catholics; its code dates back to January 25, 1983.

Civil and criminal proceedings are the subject of scientific study. Civil proceedings are classified as:

Regular: Governed by general procedural rules.
Special: Governed by special procedural rules.

Public International Law

Public international law governs actions between states and between agencies and organizations of a supranational nature. In Rome, there was an international law called the law of nations (ius gentium). In the Christian world, respect for a Christian community of nations and a law of nations based on the authority of the Pope motivated the just or unjust nature of war. The existence of a binding international law for nations is a modern conquest; it was born out of customs and practices in the 19th century and was consolidated with the appeal of arbitration between states.

For conflict resolution, two forms are established:

Non-Judicial Form: Through diplomatic relations or within international organizations.
Judicial Form: Through the intervention of international courts of justice.

The most important international organization is the UN, established by the Charter of San Francisco in 1945.

Branches or Matters of Private Law

Historically, civil law coincides with private law, which regulates relations between citizens. It has a large content from which various fields and subjects have been spreading. In Rome, the ius civile was the law of the citizen and was formed by the work of interpretatio of jurists. On the other hand, as opposed to the ius gentium and of course, according to Gayo, the law that each people establishes for itself. Private international law governs conflicts of law and responsibilities between judges from different countries regarding relations between individuals of different nationalities.

The solutions are many:

Allowing the judge to take account of foreign law.
Instructing a foreign judge to resolve a particular case (exequatur).
Other laws dictate rules depending on the subjects concerned.

In Spain, nationalities exist, and conflicts between them impose an interregional law.

Labor Law

Labor law regulates the provision of productive work done by self-employed individuals. The employment contract is between the employer and employee as remuneration for services. Traditionally, the provision of services was included in the civil contract of lease of services due to the prevailing freedom of the parties. Following workers’ demands, special legislation on the employment contract was born in the 19th century, which resulted in a discipline and a special jurisdiction to deal with problems between employers and employees.

Of particular importance is the collective agreement. It consists of a negotiated contract that governs the working conditions in a particular productive sector.

Canon Law

Canon law is the law of the Catholic Church as an organized community of believers. Three issues can be identified:

Its importance and historical significance: In Roman law, it formed the common law, ius commune, ius utrumque, which governed the Western Christian empire. The rules and principles of this law have become part of European rights.
As ecclesiastical law or statutory law of the State: Regulates Church-State relations. The agreement between the two is called the Concordat.
As matrimonial law: Regulates the procedure and purpose of marriage between Catholics. The judgments of its courts in matters of nullity and separation have civil effects.

It follows the principle of the supremacy of private initiative and autonomy in the liberal society of the codifications of the 19th century. Currently, it is in crisis due to the invasion of public law and the fact that many of its disciplines have acquired an independent character (commercial, aircraft, mortgage, etc.). The principle of autonomy, which inspired the scheme of assets, property, contracts, and inheritance, is subordinated to the interests of the community.

Civil Law

Civil law generally regulates the legal circumstances of the person from birth until death. The content of civil law was divided into three groups by Gayo: people, things, and actions. Savigny divides it into five:

General part.
Real rights.
Obligations.
Family.
Succession.

This plan is adopted by the German Civil Code and is more common in the literature. The Spanish Civil Code of 1889, enacted during the regency of Maria Cristina, consists of 1976 articles distributed in:

A preliminary title on legal rules and their effectiveness and application.
Four books: About people, goods, property and its modifications, acquisitions of property, and obligations and contracts.

Some regions have special civil rules, called Regional Law. These were enacted in compilations, written from 1959 to 1973. Article 149.1 of the Constitution reserves exclusive jurisdiction of the State in civil legislation, without prejudice to the preservation, modification, and development by Autonomous Communities of civil rights or special regional laws where they exist. Additional Provision 1a of the Constitution states that it protects and respects the historical rights of the foral territories. The general updating of the foral regime will be carried out, where appropriate, within the framework of the Constitution and the Statute of Autonomy.

Commercial Law

Commercial law was established as an independent discipline of civil law in the 16th century, although historical precedents are often found in statutes and practices of corporations of merchants of the High Middle Ages. In Rome, there were also powerful corporations of merchants and shipowners. It has experienced great development in this century due to the passage from the liberal notion of the merchant to that of the business.

In the objective sense, acts of commerce are traditionally known as those commercial operations regulated by the Commercial Code or those of a similar nature that are not included. In a subjective sense, which is currently still in force, commercial law is considered to be that which regulates the professional activity of entrepreneurs. The field of commercial law, in general, is regulated by the Commercial Code of 1885.

The structure of business organization is based on three concepts:

Entrepreneur: The owner of the company, who is subject to the rights and obligations arising from the business.
Business Activity: Those economic activities, organized and professional, aimed at the production or exchange of goods and services for the market.
Commercial Establishment: The set of goods and services that constitute the heritage of the company.

The legal status of the company has special significance because the most used associative form is the corporation. This is a capitalist society with limited liability through shares; its last adjustment was made by decree on December 22, 1989. There are other types of companies: collective, limited partnership, and limited liability.