CHAPTER ONE

INTRODUCTION TO NATURE AND DEFINITION OF LAW

The word “law” is difficult to define, because it is used in many different ways. It contains,
however, the concepts of orderliness, universality and objectivity. Some philosophers have
postulated the existence of natural law by which they mean the Law of God which regulates the
actions of mankind. This concept is often known as the principles of natural justice. Generally,
defining the term ‘law’ is not an easy task because the term changes from time to time and
different scholars define the term variously from their own perspective. Definition of the term
may vary due to different types of purposes sought to be achieved. Definitions given to the term
law are as many as legal theories.

In the narrower concept of law, there must be a set of rules which can be applied objectively with
someone to enforce them. There have been many attempts to put these into a workable
definition, some more successful than others. One of the better is that of Salmond: “Law consists
of any principle which is recognized and enforced by the courts in the administration of justice”.
Another, which is possibly superior to that of Salmond, since it has a slightly wider application,
is that of James: “A body of rules for the guidance of human conduct which are imposed upon
and enforced among the members of a given state.”

Black’s Law Dictionary says law consists of rules of action or conduct which are issued by an
authority and in addition, have binding force and are obeyed and followed by subjects. Sanction
or other legal consequence that follow the violation of law helps the law to be abided by citizens.

From the pragmatic point of view, American jurist, Benjamin defines law as “a principle or rule
of conduct so established as to justify a production with reasonable certainty that it will be
enforced by the courts if its authority is challenged.” According to Holmes “the prophecies of
what the courts will do in fact, and nothing more pretentious, are what we mean by the law”. It
is observable from these definitions that courts play great role in applying as well as creating the
law.
In general, law may be described in terms of legal order tacitly or formally accepted by the
society and enforced. A body of binding rules sufficient compliance of them is ensured by some
mechanism accepted by community is called law.

Basic Features of Law

Analysing the features and nature common to all laws would help us to understand the concept of
law. Among these features and natures, the ones considered as essential include generality,
normativity and sanction.

Generality: Law is a general rule of human conduct. It does not specify the names of specific
persons or behaviours. Hence, its generality is both in terms of the individuals governed and in
terms of the social behaviour controlled. The extent of its generality depends on-on whom the
law is made to be applicable. Consider the following illustrations.

1. Art 3, Universal Declaration of Human Rights of 1948 says: “Everyone has the right to life,
liberty and the security of a person.” This law is made to be applicable to every person on
this world. Therefore, it is universal.
2. Article 14 of the 1995 Constitution of the Federal Democratic Republic of Ethiopia says
“Every person has the inviolable and inalienable right to life, the security of person and
liberty.” This constitutional provision is made to be applicable to every person in Ethiopia
and the extent of its generality is national. This is less general than the first illustration.

Generality of the subject of the law may serve two purposes. Firstly, it promotes uniformity and
equality before the law because any person falling under the group governed by the law will be
equally treated under the same law. Secondly, it gives relative permanence to the law. Since it
does not specify the names of the persons governed, the same law governs any person that falls
in the subject on whom the law is made to be applicable. There is no need to change the law
when individuals leave the group. The permanence of law is indicated as relative for there is no
law made by person, which can be expected to be applicable eternally.

Generality of law, as indicated above, does not only refer to the subjects governed but also the
human conduct, which is controlled. The human conduct in any law is given as a general
statement on possible social behaviour. It does not refer to any named specific act like stealing,
killing by shooting and killing by spearing. Just a law can govern millions of similar acts and that
saves the legislator from making millions of laws for similar acts, which may make the law
unnecessarily bulky.

Normativity:Law does not simply describe or explain the human conduct it is made to control. It
is created with the intention to create some norms in the society. Law creates norms by allowing,
ordering or prohibiting the social behaviour. This shows the normative feature of the law. Based
on this feature, law can be classified as permissive, directive or prohibitive.

A) Permissive Law: Permissive laws allow or permit their subjects to do the act they provide.
They give right or option to their subjects whether to act or not to act. Most of the time such laws
use phrases like:has/ have the right to, is/are permitted/allowed to, shall have the right, shall be
entitled to, may, is/are free to. For instance;

1. “Every person is free to think and to express his idea.”[Article 14 of the 1960 Civil Code of
Ethiopia]. The human conduct to think and to express ideas is permitted by this law. Therefore, it
is a permissive.

B) Directive law: Directive law orders, directs or commands the subject to do the act provided
in the law. It is not optional. Therefore, the subject has legal duty to do it whether s/he likes it or
not, otherwise, there is an evil consequence that s/he incurs unless s/he does it as directed by the
law. Directive law usually uses phrases like: must, shall, has/have the obligation, is/are obliged
to, is/are ordered to, shall have the obligation/duty. For instance;

“Every worker shall have the following obligations to perform in person the work
specified in the contract of employment.” ( emphasis added) [Article 13(1) of the 2003
Labour Code Proclamation No. 377/2003].

“Shall have the … obligations to” in this law shows that the worker is directed by the law as it is
provided in the law. Therefore, it is directive law.

In general, directive laws are mandatory provisions of laws. They oblige the subject to act, as
they require him/her to act.
C) Prohibitive law: Prohibitive law discourages the subject from doing the act required not to
be done. If the subject does the act against the prohibition, an evil follows as the consequence of
the violation. All criminal code provisions are prohibitive laws. Prohibitive laws usually use
phrases like:must not;shall not; should not;no one shall/should;no person shall/should;may
not;is/are not permitted/allowed;is/are prohibited;is/are punishable; andis a crime. For example;

“Any unmarried person who marries another he knows to be tied by the bond of an
existing marriage is punishable with simple imprisonment.” [Article 650(2) of the 2004
Criminal Code of Ethiopia]

”is punishable” in this law, indicates that the law discourages such act. Therefore, it is
prohibitive law.

Sanction: Each and every member of a society is required to follow the law. Where there is
violation the law sanction would follow. Sanction, according to Black’s Law Dictionary, is a
penalty or coercive measure that results from failure to comply a law. The main purpose of
sanction is to prompt a party (a wrong doer) to respond. In other words, sanction will make the
wrong doer to think that s/he made a fault and s/he should correct it. Sanction may be criminal.
Criminal sanction is a sanction attached to criminal liability. If the fault committed is defined by
criminal law, the person will be liable to a sanction provided under the criminal

Functions of Law

Why we need law? As the issue of definition of law, there is no agreement among scholars as to
the functions of law. Jurists have expressed different views about the purpose and function of
law. It is well known that law is a dynamic concept, which keeps on changing with time and
place. It must change with changes in the society. Law, in the modern sense, is considered not as
an end in itself, but is a means to an end. The end is securing of social justice. Almost all
theorists agree that law is an instrument of securing justice. As Salmond rightly pointed out, “law
is a body of principles recognized and applied by the State in the administration of justice.”
Bentham gave a very practical version of the purpose of law, which according to him, is
maximization of the happiness of the greatest number of the members of the community.
According to Holland, the function of law is to ensure the well-being of the society. Thus it is
something more than an institution for the protection of individuals’ rights.
Roscoe Pound attributed four major functions of law, namely: (1) maintenance of law and order
in society; (2) to maintain status quo in society; (3) to ensure maximum freedom of individuals;
and (4) to satisfy the basic needs of the people. He treats law as a species of social engineering.

The object of law is to ensure justice. The justice may be either distributive or corrective.
Distributive justice seeks to ensure fair distribution of social benefits and burden among the
members of the community. Corrective justice, on the other hand, seeks to remedy the wrong.
Thus if a person wrongfully takes possession of another’s property, the court shall direct the
former to restore it to the latter. This is corrective justice. Rule of law is something without
which (sine qua non for) an even-handed dispensation of justice can exist. It implies that
everyone is equal before law and law extends equal protection to everyone; judges should impart
justice without fear or favour and like cases should be treated alike.

It must, however, be stated that justice alone is not the only goal of law. The notion of law
represents a basic conflict between two different needs, namely, the need for uniformity and the
need for flexibility. Uniformity is needed to provide certainty and predictability. That is, where
laws are fixed and generalized, the citizen can plan his/her activities with a measure of certainty
and predict the legal consequence of his/her conducts. This is even more necessary in case of
certain laws, notably, the law of contract or property. Uniformity and certainty of rules of law
also bring stability and security in the social order. Today the following are taken as important
functions of law.

A) Social control – members of the society may have different social values, various behaviours
and interests. It is important to control those behaviours and to inculcate socially acceptable
social norms among the members of the society. There are informal and formal social controls.
Law is one of the forms of formal social controls. As to Roscoe Pound, law is a highly
specialized form of social control in developed politically organized society. Lawrence M.
Freedman explains the following two ways in which law plays important role in social control:
first, law clearly specifies rules and norms that are essential for the society and punishes deviant
behaviour. “Secondly, the legal system carries out many rules of social control. Police arrest
burglars, prosecutors prosecute them, courts sentence them, prison guards watch them, and
parole broads release them.
B) Dispute settlement: Disputes are unavoidable in the life of society and it is the role of the law
to settle disputes. Thus, disagreements that are justiciable will be resolved by law in court or out
of court using alternative dispute settlement mechanisms.

C) Social change: A number of scholars agree about the role of law in modern society as
instrument to social change. Law enables us to have purposive, planned, and directed social
change. Flexibility of law provides some measure of discretion in law to make it adaptable to
social conditions. If law is rigid and unalterable, it may not respond to changes spontaneously
which may lead to resentment and dissatisfaction among the subjects and may even result into
violence or revolution. Therefore, some amount of flexibility is inevitable in law.

Classification of Law

As the law includes various rules, procedures and norms that regulate human behaviour and it
serves a very useful function in the society and law may be divided depending on function it
serves in the society or other criteria of categorization. Some of the classifications are:

Substantive and procedural laws: This classification is depending on the nature the law itself,
meaning the provisions of the legal text. Substantive laws are those that create, define and
regulate legal rights and obligations; whereas procedural laws define and deal with procedures
for enforcing the rights and duties articulated in substantive laws.

Public and private laws: This classification is depending on the nature the relationship that the
law governs. Public law is concerned with the relationship within the government as well as that
exists between government and citizens whereas private law governs the relationship between
individual citizens and in some exceptional cases the relation between government and citizens.
There can also be other classifications like civil and criminal, and international and domestic
laws.

International Law and Domestic Law: This classification is depending on the territorial scope
of application of law, meaning the geographical space where the law will be applied. Domestic
laws are applicable in the boundary of a single country that enacts it and governs the relation
with in that boundary. On the other hand, international law is applicable cross-border, in all or
some countries. It governs the relationship between different countries (states) and the
relationship between citizens of different countries.

From your understanding of some points about law in the above lesson, can you try to guess
what business law is and what its functions are? The discussions above may be equally
applicable for business law. For a matter of specification; business law is a law that governs the
relationship between individuals taking part in business transactions. It governs how certain
economic activities that affect economic orders of the country take place between those
involving themselves in such activities. It is a collection of rules from different laws that have
relevance of governing business relation.