A Comparison between the Common Law and Civil Law Legal Traditions - Coursework Example

Order 333960 Word count: 2008 d 11th November 2009 Critically discuss a comparison between the common law and civil law legal traditions with particular reference to the importance of this comparison for international business The common law and civil law form two most important laws that guide the direction of the judiciary and legal reforms (Holmes Jr, 2001). They have been in practice since long ago and some countries practice either of them and few countries practice both of them by balancing the laws based on the circumstances. Both these laws are aimed at reducing the disputes arising from national and international conflicts. Though their nature and origin and history vary from each other, the main objective of the two legal systems lies in providing dispute free environment through out the world. When international trade occurs in any region, it involves tow or more nations and they sign some agreement or memorandum in the beginning and interpretation of the clauses mentioned in the agreement may differ from region to region. Hence depending upon the geographical boundaries in which this law is applicable, the nature of the law and its impact varies significantly. With the advent of globalization and liberalization in 1980s and 1990s, the world has become highly connected at different regional points. Information technology and internet and cell phone technology considerably changed the world in several sectors in general and international business in particular (Yergin and Stanislaw, 2002). International business developed tremendously due to the fast communications developed in the recent years (August et al., 2003). However, it has also brought some negative effects because of the higher number of transactions per unit period in international business. At the same time, the differences in jurisdiction of several geographical regions also led to severe conflicts in international trade. This also reflected the diversity of interpretation of different legal systems practiced in various nations. This is critical if interpretation is made for analyzing the English common law and Civil law in resolving the disputes related to international business (Brown, 2001). This has also led to development of new areas of interpretation in international commercial law (Good, 2004) In several occasions, the judiciary faces difficulty in maintaining balance between the common law and civil law. Depending upon the geographical region in which the conflict happens, the interpretation of law varies (Murray et al., 2007). For example, if the conflict in international business is experienced in United Kingdom, the common law would be taken in to consideration for resolving the disputes (Hale and Gray, 2002). Similarly, if the dispute occurs in Germany, the civil law would be made as main reference by the judiciary (Blum, 2007). Several researchers reported the great differences in international commercial arbitration related to the civil law and the common law provisions. It was also opined that the difference mainly arise due to difference between jurisdictions that favor and support arbitration and jurisdictions that are disfavoring arbitration. It was also confirmed that to make a smooth journey related to the international commercial arbitration, the full interpretation of the rule of law is essential. It was also well proved that the legal systems through out the world are in general described in terms of ‘Civil Law systems’ and ‘Common Law systems’.  Several nations use either one of these systems.  For example, the civil law system was developed from ancient law which in turn got influenced by Roman and Byzantine legal codes and later to the Napoleonic legal codes.  This civil law legal system is commonly seen in Europe and Scotland. This is also common in China, Japan and French, Portuguese and Spanish ex-colonies in Asia, Africa and North and South America.  While interpreting the common law in resolving the disputes of international business, the history of the common law is also to be taken in to consideration. The common law system has its historical antecedent in Roman Law, and it was developed from the integration of the Norman and Anglo-Saxon legal systems after the Norman conquest of England (Glannon, 2008).  This legal system is the basis for the legal systems of the UK excluding Scotland, the US (except Louisiana and Puerto Rico), Canada and in Africa, Asia, the Americas, India and Pakistan.  It differs from civil law in extent of involvement of judges. It makes judges to involve for much more time relative to that of civil law. The common law also permits all the aspects which are not prohibited. Over a period of time, the common law and civil law have undergone significant changes, they both derive inspiration from each other. No doubt, higher number of statutes related to international business are available which are legislated to source law in common law system than civil law system. In case of civil law, law is expected to develop gradually over a period of time based on judicial decisions interpreting general principles of code provisions. The international trade and business transactions involve management of the risks of trade in goods and services (Schaffer et al., 2004). They also involve the protection and licensing of intellectual property, and foreign direct investment. The thorough examination of both private and public law issues from both an international and comparative perspectives and through interpretation of civil law and common law based on the area of conflict is very much required. The interpretation of common law and civil law must take in to consideration of the legal, cultural, political and economic environment existed during the time of dispute. The origin of the common law is nothing but the English law and is strictly followed within the geographical limits of England and Wales. The advantage of English common law is that the disputes of international business will be solved by application of common sense and knowledge by the judges after thorough sitting and group discussion. The highest apex court of United Kingdom is Supreme Court whose judgment related to the international business is final and the lower courts are bound to follow the judgment of the Supreme Court at any circumstance. The constitutional authority of the courts and thorough interpretation of their previous decisions makes the process of development of common law to happen. Even in cases of emergency and public welfare activities, the common law can be amended or repealed by Parliament. This makes the common law more flexible in nature to suit the needs and requirements of the various sections of people. If some international dispute arises in United Kingdom, the common law prevails over the jurisdiction of civil law and the Supreme Court would take a final decision which is binding on the lower courts. United Kingdom comes under European Union and hence the civil law jurisdiction also has to be taken care. The European law takes in to consideration regarding the interpretation of civil law relative to common law. Similarly, the European Court of Justice becomes the main legal body or judicial wing that takes decisions on the cases related to disputes of international business. Folsom et al (2004) identified the main areas of dispute that are generally witnessed in international business include the documentary sale, currency issues, technology transfers. Moreover, the immunity of states and the act of state doctrine in commercial arbitration create a major problem due to different jurisdictions of local laws in the areas of conflict. Both common law and civil law differ primarily in the principles of practice and as mentioned earlier, the common law enjoys great superiority over the civil law in resolving the disputes of international trade. This is because of the fact that the common law works as a practical jurisprudence and hence efficiently regulates the affairs of society. As long as the rights and obligations related to commerce law and trade law are clear, common law is expected to deliver a verdict with certain nature. In those cases, where legal provisions are not well defined, the judges will not be allowed to take their private interpretations for resolving the disputes arising from international trade. Hence the principles of interpretation are considered to be fixed and certain which form the base for the final judgment in international trade related aspects. It is completely contrary in case of civil law where different schools of interpretation exist like the historical and philosophical schools. The nature of law and judgment cannot be considered as stable and certain as in case of common law. This leads to significant level of confusion and the law is subject to all the fluctuation in practice which grows out of the different principles of interpretation of these schools.   One more important difference can be found in the administrative principles of the common law and the civil law in the form of different modes of procedure and with the different degree of respect paid to technical forms. In case of common law, each step of the judiciary making is very clear and transparent and the public can verify the application of legal provisions. The law making process consists of various steps and each step can be understood very clearly in case of common law where as the situation is completely different in civil law interpretation. The settlement of disputes arising from international business transactions require most impartial and speedy judgments. This requires the thorough interpretation of legal provisions and previous judgments and higher level of flexibility. Hence the interpretation of common law and civil laws play vital role in reducing the conflicts in international trade. Though these two legal systems differ in some specific aspects and norms and procedure, they provide ample balance between the laws and genuine party under commercial transactions would be provided with justice. The advantage of common law is in providing speedy judgment mechanism for all the disputes of international trade as it specifically focuses on minor aspects of dispute. The common law systems develop their laws over time and they modify the laws by single rulings. This practice facilitates a more flexible and expeditious legal system bypassing the often reluctant and slow paced legislative system. Overall, it may be concluded that the international business related disputes can be solved by interpretation of the civil law in countries like Germany, France and Spain where it is in practice. In these countries, legal principles and codes constitute the soul of the legal system. These legal principles are derived further from the laws and legal system of the Roman Empire. If any amendment has to be made to the existing legal provisions, the bill has to be passed through legislation which is time consuming process. However, it allows higher element of stability of the judgment than that of common law. The judges must read the legal provisions and statutes thoroughly before giving the final judgment. In case of countries which use common law as a legal system like United Kingdom and USA, the disputes related to the international business can be resolved primarily based upon past judicial opinions. References August, R.A., Mayer, D. and Bixby, M. 2003. International Business Law. 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Schaffer, R., Earle, B. and Agusti, F. International Business Law and Its Environment P: 768. South Western College publication. ISBN-10: 0324261020. Yergin, D. and Stanislaw, J. 2002. The Commanding Heights : The Battle for the World Economy. Free Press publication. P:512. ISBN-10: 068483569X. Read More