PAKISTAN LEGAL SYSTEMNecessity of Study of Law

&Sources of Law

By

Khalid Mahmood Lodhi

Lecture No. 1

Outline

IntroductionWhy study law?Meaning of LawSources of LawLaw MerchantCommon LawEquityRelationship between common law

and equity

Common Law and Equity distinguished

Classification of Pakistan LawCivil and criminal law distinguishedCrime

Outline (Cont…)

Meaning of Law

Law is the rules and regulations which are adopted by society to help it to function or to regulate the actions of its citizens, and if these rules are broken penalties and other sanctions are to be imposed.

Definitions of Law

Some definitions are given below:

a) PLD (1963) Dac 422: Law is a body of Acts, Orders, Ordinances, Regulations, Rules, Conventions, Customs and practices which have the sanction of an authority capable of establishing law and order and which is thus enforced or recognized by courts and other law-enforcing machinery.

b) Law Dictionary By Osborn: Law is a body of principles recognized and applied by the government in the administration of justice.

c) PLC (1963) S.C.1: The word law necessarily connotes a written law or a written instrument having the force of law.

d) Vinogradoff: Law is a set of rules imposed and enforced by a society with regard the attribution and exercise of power over persons and things.

Introduction

‘Pakistan Legal System’ consists of:The entire framework of the law of

PakistanThe manner of its creationThe procedure for applying itThe court structureMethods of interpreting itThe procedure of changing the law etc.

Criminal matters are the subject of Criminal Law dealt with the Criminal Procedure Code (CPC)

Objective of Study of Legal System

The study of Pakistan legal system provides a good working understanding of:

How the Pakistan legal system functionWhat are legal consideration in making

contractsWhat are the constraints upon setting up

and running companies How employment contracts are protected

Why Study Law?

This aspect may be considered from different angles:

a)Effect of Law on citizens

b)Effect of Law on business

c)Effect of Law on profession

Effect of Law on citizens

Every citizen is subject to law. Its ramification affects us all every day while:

Making consumer contractsMaking employment contractsMaking social contracts Enjoying welfare rightsLending and borrowing fundsProtection of life and property Enjoying acquiring or transferring ownership rightsTraveling in a bus or carOr whatever

Effect of Law on business

Trade is nothing but a series of contracts. Such contracts shall be enforceable and valuable to business only when they are legally protected. They are certain rules and guidelines for setting up and administrative running of certain categories of businesses e.g.

Partnership organization is governed by the Partnership Act, 1932.

Companies are governed by Companies Ordinance, 1984

Insurance companies are subject to Insurance Act, 1938.

Banking companies are controlled by Banking Companies Ordinance, 1962.

Modaraba companies are regulated by Modaraba Companies & Modaraba (Floatation & Control) Ordinance, 1980.

Effect of Law on Profession

An accountant is considered an expert in auditing, taxation and corporate law matters and he is required to provide professional assistance to his clients on matters such as:

Formation of a companyUnderwriting agreementAgency contractsPurchase and supply contractsForward tradingSettlement of labour disputesProtection of trade marks, copy rightsMany other matters of business interest

Sources of LawFormal Sources: The formal sources of law, according to Salmond, is the will of the State as manifested by status or decisions of the courts. Material Sources: The material sources of law are those from which the law derived its matters. Material source may be historical source or legal source. Historical Sources are those rules which earlier were found in unauthoritative form but later on become converted into legal principles. Such sources are common law and equity. Legal Sources are those which are the instruments of the State by which legal rules are formulated. Legal sources are legislature precedent, customs and agreement.. Legislation is the law created by the Parliament of a country and other bodies to whom it has delegated authority. Precedent is judgment or decision of a court of law cited as an authority for deciding an identical case which serves as an authority for legal principle embodied in its decisions.Customs: The law which is based on custom is termed as cutomary law Customs are not permanent source of law. In Pakistan cutomary laws has been replaced by Shariat Law.Agreement: Not infrequently parties in their agreement incorporate a number of stipulations which are binding on the contracting parties in addition to general law of the country. These stipulations have the force of law and may be termed as conventional law.

Chart of sources of law

Sources of Law

Formal sources Material sources

Historical sources

Legal sources

Common Law

Equity

Agreement

Customs

Precedent

Legislation

Law Merchant

The law Merchant: or lex mercatoria is a collection of legal principals. Its basis was the customs and practices of merchants. At first it was dealt separately in district courts but eventually it became part of the Common Law.

Chief Justice Cockburn in Goodwin v. Roberts (1875) observed:

“The law Merchant is neither more or less than the usages of merchants and traders in different departments of trade, ratified by decisions of courts of law, which upon such usages being proved before them, have adopted them as settled law with a view to the interest of trade and public convenience, the courts proceeding herein on the well known principle of law that with reference to transactions in the different departments of trade, courts of law, in giving effect to the contracts and dealings of the parties, will assume that the later have dealing with one an other on the footing of any custom or usage prevailing generally in the particular department. By this process what before as usage only, unsanctioned by legal decisions, has become engrafted upon, or incorporated into the Common Law and thus become a part of it.”

Common LawDefinitionsa. Commercial dictionary by Grandage: “ Common

Law is that part of the law of England which was formulated, developed and administered by the old common law courts, based originally on the common customs of the country.

b. DLR (1955) F.C 253: Common law signifies rules, customs and recognized principles which are not set down in writing in any Act of Parliament. The binding power of common law as a law emanate from long and immemorial usage and universal acceptance throughout the realm. The authority of these customs, rules and maxims rests entirely upon reception and usage as developed by judges.”

c. Law dictionary Osborn: “common law is the common sense of the community, crystallized and formulated by the forefathers, it is neither local law nor the result of legislation.

Equity

Definitionsa) Grandage commercial dictionary: “Equity is the body

of rules founded in fairness and justice which was evolved by the Lord Chancellor and court of Chancery to supplement the common law and also alleviate its harshness.

b) Maine Osborn law dictionary: “Equity based primarily on fairness and natural justice is a fresh body of rules by the side of original law, founded in district principles, and claiming to supersede the law in virtue of a superior sanctity inherent in these principles.”

c) Legal terms and phrases M.I. Khan: “Equity in its broadest and most general signification, denotes the spirit and habit of fairness, justice, and right dealing which would regulate the relation of men with men, the rules of doing to all others as we desire them to do us.”

d) Justinian BLD IV: “Equity denotes a spirit to live honestly, to harm no body, to render to every man his due.”

Relationship between common law and equity

1. When common law and equity conflict, equity must be prevail. 2. Common law is a technical law which influenced equity to

make it a consistent body of doctrine and as technical as common law.

3. Common law was administered in royal courts whereas equity was administered in court of chancery.

4. Common law was supplement and some times overruled by principles of equity.

5. A plaintiff who began proceedings in Common Law Courts (or in Equity Courts) after years of expensive litigations and finding him nowhere had to begin again in equity court (or Common Law Court).

6. Duel court system was ended by Judicature Acts 1873-1875 which amalgamated Common Law Court and Equity Courts.

7. Although courts have been amalgamated Common Law and Equity remain distinct.

8. Common Law is automatic in its applications, equity provides and alternative solution subject to discretion of the court.

Common Law and Equity distinguished

Common Law1. Common Law is inflexible, rigid and is based on rules of bureaucracy 2. Common Law emerged first in time and was intended to be all around. 3. Common law provides damages to injured party as the only remedy.4. Common law prescribes set time limits for bringing action 5. Limitation Act lays down a general limit on commencement of

proceedings.

Equity 1. Equity is flexible and is based on fairness, conscience and moral code.2. Equity followed common law by adding ‘gloss’ to it by imposing fairness.3. Equity supplements the common law.4. Equity has many different remedies each suitable to a given situation.5. Equity has no strict time limits for bringing action.6. Principle of ‘Delay Defeats Equity’ applies to impose an overall burden of

reasonableness on the plaintiff.

Classification of Pakistan Law

Pakistan law may be divided into a number of categories which have not been laid down by any statute but have been devised as aids to understanding and exposition. Such categories are:

a) Public Law b) Private Law

c) Civil law d) Criminal law

Civil and criminal law distinguished

1) Civil law cases affect only the injured party and not the entire society.

2) Civil proceedings are initiated by the injured party.

3) Civil law regulates disputes over the rights and obligation of persons dealings with each other.

4) In Civil cases compensation awarded is given to the injured party.

5) In Civil cases breach is to be proved by the party claiming compensation.

6) Civil proceedings assist individuals to recover property or enforce obligations owed to them.

7) Civil law aims to provide individuals compensation for his loss.

8) Under civil law action plaintiff cannot recover more than he has lost.

1) Criminal law cases, as a result of a crime affect the whole community or society.

2) Criminal proceedings are started by the State and the victim has no say in the matter.

3) Criminal law punishes the guilty person or offender.

4) In criminal cases the fine recovered from the offender are retained by the State.

5) In criminal cases burden of proof to convict the accused lies on the State.

6) Criminal proceedings are taken top suppress crimes and are largely controlled by State (Government)

7) Criminal law does not in any way benefit the victim from a conviction.

8) Criminal law aims to deter wrongdoers and in principle correct and reform offenders.

Crime

Khan Legal Terms and phrases: Crime may be defined as “ Acts and defaults which tend to the prejudice of the community, and forbidden by law on pain of punishment inflicted at the suit of the Government.

Osborn Law Dictionary: “ A crime may be described as an act, default, or conduct prejudicial to the community, the commission of which by law renders the person responsible liable.

Thank you.