Corporate and Business Law (LW-GLO) - For Exams from September 2023 - August 2024
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1.3.2 Common Law
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In civil law systems one only has to look in the appropriate code to find the law relating to that
area. However, in a common law system one has not only to look at the legislation made by Medium
parliament, but also in the cases for the judicial statement that actually constitute that
common law. Low
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Common law and statute relate to the source of law. Common law is judge-made; statute
law is produced by Parliament. As Parliament is sovereign, it can alter common law by Category
enacting legislation to that end.
1.3 Civil Law, Common
Law and Sharia Legal
3.2.1 Historical Development of Common Law Systems
The development of the common law can be traced back to judges appointed by the Crown
in England in late mediaeval times to travel the country, hearing cases, identifying and
applying fundamental principles of law, and thereby developing a consistent “common
law” throughout the realm. The judiciary also came to be responsible for the interpretation
and application of statute.
The system and principles of “common law” were subsequently exported to Britain’s colonial
and trading partners across the globe. Common law has at its heart a large body of judge-
made body of rules, known as case law.
Definition
Case law – the judicial interpretation, explanation and application of law by reference to
individual cases.
The common law system also developed the widespread use of juries to decide questions
of fact in contested cases, with a judge presiding to guide and rule on matters of law, and to
pass sentence. The jury remains an important feature of criminal trials in common law
countries, and the citizens’ right to trial by jury is enshrined in the US constitution. Juries are
also used in some non-criminal cases in some common law countries.
3.2.2 Nature of Common Law
Common law judicial decisions contain declarations and explanations of fundamental
principles of law and are recorded in official law reports. The legal principle on which the
decision rests (referred to as the ratio decidendi – the reason for the decision) sets a
precedent which must be followed by judges of equal or lower rank dealing with similar
situations in the future.
The common law governs the basic principles of business law in common law countries
and states, particularly the law of contract/obligations. The concept of damages – money
compensation for harm suffered in consequence of wrongdoing – is a Common law feature.
Common law is augmented and modified by the application of “equitable” principles of
fairness and good conscience where the general principles of the common law are lacking.
Equity offers extra remedies and defences to supplement the common law remedy of
compensation, where a payment of money would not be appropriate to remedy the problem.
These include injunctions (i.e. court orders compelling a person to do something or to cease
doing something, for example, to return misappropriated goods to their owner, or to honour a
non-compete agreement with a former employer) and orders of specific performance (i.e. a
court order compelling a party to a contract to perform contractual obligations under the
contract).
However, common law states are not regulated exclusively by judge-made law: case
law is supplemented by international treaties; national and regional constitutions; EU law
(amongst member states); and domestic statute, statutory rules and administrative
regulations. The judiciary has an important role in interpreting and applying these laws.
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