Exercise 1A. Law and Co-ordination

One very important function that law performs is the simple one of co-ordinating our activities in society so as to enable us to achieve goods and goals that we simply could not achieve if we each did whatever we thought was best. An obvious example is driving. If each person who drives to work is to get to his or her destination safely, there has to be a rule telling everyone on what side of the road to drive on. If we left it up to every driver to make up their own mind what side of the road to drive on, then chaos, and multiple accidents, would ensue. So a central authority is required to ‘lay down the law’ and tell every driver on what side of the road to drive.

Many areas of the law can be seen as performing this co-ordinative function. For example, in the absence of law, there would be severe limits on what goods and services people could trade with each other. As between strangers (who have no reason to trust each other), only instantaneous exchanges of goods for money would be possible. So only goods that are easily portable (and therefore easy to carry to market and easy to hand over on the spot and easy to carry away having been bought) could be traded between strangers. The law of contract allows strangers to make much more ambitious deals with each other by reassuring them that if the other party to the deal lets them down, they will have a legal remedy against that party. In this way, the law of contract allows people who have no reason to trust each other to act as though they do. The trust they have in the law to protect them if they are let down allows them to take a chance on being let down by someone they have made a deal with.

And many lawyers spend all their time using the law to co-ordinate different people’s activities so that a particular good or goal can be achieved. For example, consider the sale of a piece of land, or the takeover of a company, or the creation of a regulatory body, or an arrangement over custody and access to the child of divorced parents – none of these things could be done without the involvement of lawyers, working out what rules should govern whatever it is that we are trying to do.

The following exercise is all about drafting rules that will work effectively to co-ordinate a particular activity. You have been summoned to the offices of Ian Rich. Rich wants to set up a foundation that will help students with the cost of studying at university. He tells you:

  • ‘The basic idea is that if a student can’t afford to go to university, we’ll help them out. But we want to focus on students who are studying proper subjects at university, none of that Mickey Mouse degrees nonsense – you know what I mean?’
  • ‘The money will be given out by a committee. I suppose they should meet once a year to consider the applications for funding that have been made to the foundation. But they’ll also have to meet at least one other time in the year, just to discuss how the foundation is going and do some work on fundraising – all the money can’t come just from me. I’m going to give the foundation £10 million to get it started, but after that it’s up to the committee to make it work. But we’ve got to make sure that they try to make it work. I don’t want them giving out all my money and then saying, “We’ve got no more money left, so let’s wind up the foundation”. This foundation is my legacy – it’s got to last.’
  •  ‘I think this committee should have at least five people on it. Not less than five. But not more than fifteen. That would be a nightmare: endless discussions. I want the committee to have a good mixture – people from industry, people from academia, maybe someone from some student union. So we get everyone’s views as to who’s most deserving.’
  • ‘I’m really concerned that we don’t waste any money. We’ve got to make sure that the applications we get are genuine – that no one’s lying to us and saying that they’ve got no money when their parents are rolling in it. But then again, some parents can be really tight with money – my dad never gave me a thing. And if we give out some money to some student who then wins the Lottery, we need to be able to get our money back.’
  • ‘Obviously, to do all this, we’re going to have to employ some staff. And I’m happy for some of my money to be used on that. But it just mustn’t be wasted. I don’t want some committee member appointing his brother-in-law to some PR position just to keep his wife happy.’
  • ‘I don’t want to be on the committee myself. I’ve got too much to do. But I’d like to be consulted on what the foundation is doing and what its plans are. I don’t want a veto, just a say in what’s going to happen. That seems fair to me.’

 

Your job is to come up with a constitution for the foundation that will give effect (so far as is possible) to Rich’s wishes, as set out above. In drawing up the constitution, don’t just pay attention to what Rich told you he wanted – also pay attention to what he didn’t say, but would have wanted you to deal with had he thought about. It is a vitally important part of a lawyer’s job to think of possibilities and issues that no one else has bothered to consider or raise. For example, how is the committee supposed to make decisions? Unanimously? By majority vote? By a two-thirds majority? Are there any further limits (other than the ones Rich has raised) that it would be desirable to place on what students might be eligible from support by the foundation?

When you have finished drawing up your constitution, have a look at it. What sort of qualities or properties do the rules of your constitution need to have for the constitution to work properly to help the foundation do its work in the way intended? A famous American legal academic, Lon Fuller, suggested that law had to have certain formal properties if it was to work properly to co-ordinate people’s activities in society. You can find out more about his views here. Fuller attempted to argue that there was something morally valuable about governing people through legal rules that adhered to his ‘eight desiderata’. This claim has been the subject of intense debate ever since. To read one of the latest words in this debate, read this article:

Jeremy Waldron, ‘How law protects dignity’

Next page: Exercise 1B. Law and Rights