Chapter 4 The Constitution as the Foundation of the Legal Environment

1. Twomey  JenningsAnderson’s Business Law and the Legal Environment, Comprehensive 20eAnderson’s Business Law and the Legal Environment, Standard 20eBusiness Law: Principles for Today’s Commercial Environment 2e Chapter 4 The Constitution as theFoundation of the Legal Environment

2. The U.S. Constitution and the Federal System • The U.S. Constitution created the structure of our national government and gave it certain powers. • It also placed limitations on those powers. • It created a federal system with a tripartite (3-part) division of government and a bicameral (2-house) national legislature.

3. Branches of Federal Government LEGISLATIVE BRANCH Bicameral Congress Senate House of Representatives ADMINISTRATIVE AGENCIES (Created by the executive or legislative branches to carry out a specific function.) JUDICIAL BRANCH Courts EXECUTIVE BRANCH President

4. U.S. Constitution and the States • Constitutional Powers: powers are possessed exclusively by the federal government. • Delegated Powers: given by states to the national government.

5. U.S. Constitution and the States • Shared Powers: delegated by states to national but shared with states. • Federal Supremacy. • Express federal regulation. • “Silence of Congress”.

6. Delegation of Powers U.S. Constitution and the States We, the People give power to… The states, who ratified the… Federal Government State Government U.S. Constitution, which reserves some powers for the States, delegates some powers to the Federal government, and allows some powers to be shared, or exercised by both.

7. Interpreting and Amending the Constitution • Conflicting Theories: • In the bedrock view, the purpose of a constitution is to state certain set principles. • In the living-document view, a constitution states goals and is intended to change with time. • In recent years the use of the living-document interpretation has expanded the powers of the federal government.

8. Amending the U.S. Constitution The Constitution has been amended, or changed, in three ways: *Formal Amendment - Only 27 formal amendments to the Constitution have been completed, though thousands have been proposed. Judicial Interpretation– The U.S. Supreme Court has been called upon to apply the Constitution to many new situations, unforeseen to the document’s original writers. By Practice – In a few cases, the actions of government have established accepted practices which depart from the requirements of the Constitution. *Article V of the U.S. Constitution specifies the procedure for adopting amendments.

9. Federal Powers • Commerce Clause Powers. • Became general welfare power (the “affectation” doctrine). • Commerce clause today. • Commerce power limits power of states. • Financial Powers. • Tax, borrow, spend, and coin money.

10. Constitutional Limitations on Government Constitutional Limitations on Government • Among the limitations on government that are most important to business are the requirements of: • Due Process. • Substantive vs. Procedural. • Equal Protection of the law. • Reasonable Classification.

11. The Bill of Rights and Business • First Ten Amendments provide protection for individuals and corporations. • Businesses enjoy free speech protections under the First Amendment. • Commercial Speech (advertising).