The Business Lawyer and the Rule of Law – The Rule of Law Is Our Business 

10 Min Read By: Kimberly Lowe

“Law is nothing else but the best reason of wise men applied for ages to the transactions and business of mankind.”   Abraham Lincoln

Advancing the Rule of Law Now

By Presidential Action on April 30, 2021, President Biden proclaimed May 1, 2021 as Law Day, U.S.A., 2021. The President “called upon all Americans to acknowledge the importance of our Nation’s legal and judicial systems . . .” setting the theme for Law Day, U.S.A., 2021 as “Advancing the Rule of Law Now.”  For the record, Law Day is not new; it was not created by Joe Biden.  President Eisenhower established May 1 as Law Day in 1958 (Eisenhower creates Law Day) with recitals like:

  • “it is fitting that the people of this Nation should remember with pride and vigilantly guard the great heritage of liberty, justice and equality under law,”
  • “the principle of guaranteed fundamental rights of individuals under the law is the heart and sinew of our Nation,”
  • “a day of national dedication to the principle of government under laws would afford us an opportunity better to understand and appreciate the manifold virtues of such a government,” and
  • “I especially urge the legal profession, the press, and the radio, television and motion picture industries to promote and participate in the observance of [Law Day],” 1958.  

Between the bookends of Law Day, 1958 and Law Day, U.S.A., 2021, America has celebrated many Law Days, most with themes applauding liberty, justice and equality. 

So, if Law Day was established to promote the United States’ system of justice and government with the legal profession (along with the media) charged as its ambassador, how do business lawyers in 2021, as members of the legal profession, promote and participate in the advancement of the Rule of Law now? 

Most business lawyers identify themselves by the types of transactions they assist clients with (such as M&A, Securities, Derivatives and Futures Law, International Business Law) or the types of entities or industries they work with the most (like Health Law, Nonprofit Organizations, or Credit Unions).  When asked what they do, most business lawyers describe their job as helping their clients navigate the legal landscape in which they operate, be it tax, securities laws, regulation, corporate governance.  Few business lawyers see themselves as agents of liberty, justice and equality – let alone promoters of the Rule of Law.  In contemplation of the Rule of Law call, some business lawyers might scratch their heads, digging way back into memories of law school to ponder long forgotten Con Law classes.  Or if very motivated, they might dust off a tattered copy of the U.S. Constitution (or pull up a PDF of it) to contemplate how the Bill of Rights has anything to do with M&A transactions.  Instead of overthinking it, business lawyers are best served by just accepting a simple truth – business lawyers are more than just agents of the Rule of Law. The Rule of Law is “the business” of a business lawyer.

What Does Rule of Law Mean?

Today, these three simple words are thrown around constantly.  “Ubiquitous” may be an understatement.   The overuse of the phrase “Rule of Law” is unfortunate since it dilutes how important this concept is to America and its history. 

The American Bar Association describes the rule of law as a set of principles, or ideals, for ensuring an orderly and just society. The rule of law assumes that no one is above the law, everyone is treated equally under the law, everyone is held accountable to the same laws, there are clear and fair processes for enforcing laws, there is an independent judiciary, and human rights are guaranteed for all. This description works well when informing individuals about how Rule of Law applies to them, but it is not particularly helpful to a lawyer understanding the specific lawyer’s role within a Rule of Law construct.  

The best way to understand Rule of Law constructionally might be to examine the words of our founding fathers. 

John Adams, in his Novanglus Essays, stated:

“This power in the people of providing for their safety anew by a legislative . . . which is founded only in the constitutions and laws of the government . . . For when men, by entering into society and civil government, have excluded force, and introduced laws for the preservation of property, peace, and unity, among themselves.” 

Basically, a legislative body elected by the people agrees upon and write downs the laws and then every member of society agrees to abide by those laws and if there is a dispute between members of society, those disputes will be resolved not by force but by a tribunal.  Hatfields and the McCoys – bad; Portia’s defense of Antonio in The Merchant of Venice – good. 

If John Adams carries the water for a civil society, James Madison might better illuminate how the founding fathers envisioned the Rule of Law in the context of commerce.  In Federalist Papers No. 10 James Madison[1] wrote:

“But the most common and durable source of factions has been the various and unequal distribution of property. Those who hold and those who are without property have ever formed distinct interests in society. Those who are creditors, and those who are debtors, fall under a like discrimination. A landed interest, a manufacturing interest, a mercantile interest, a moneyed interest, with many lesser interests, grow up of necessity in civilized nations, and divide them into different classes, actuated by different sentiments and views. The regulation of these various and interfering interests forms the principal task of modern legislation, and involves the spirit of party and faction in the necessary and ordinary operations of the government. No man is allowed to be a judge in his own cause, because his interest would certainly bias his judgment, and, not improbably, corrupt his integrity.” 

In promoting the U.S. Constitution to the citizens of New York, the epicenter of commerce at the time (and now), Madison foretold the future role of the business lawyer within the Rule of Law framework.  While not completely conceptualized when the U.S. Constitution was adopted, Madison predicted the various areas of laws that Adams’ legislative body will tackle as the government’s regulatory system is built out – the rules that the law makers will make – our Rules of Law.  

The U.S. Constitution and the Bill of Rights

Our embrace of the Rule of Law is personified in the structure of governance embodied in the U.S Constitution and its amendments, and by reservation, the constitutions of the various states and territories that make up the United States.  So, the M&A lawyer (or any other business lawyer) who looked to the Bill of Rights to find a place within the Rule of Law, the “sinew of our Nation,” was not that far off when considering how that lawyer fits within the construct of the Rule of Law. 

The 10th Amendment of the Bill of Rights[2] clarifies the concept of Powers and which “body” has which Powers – the United States, the States or the people.  Article I, Section 8 of the U.S. Constitution sets forth the various “Powers” of the Congress (Adams’ “legislative”) which includes the power to:

  • tax (the Internal Revenue Code is “sparked”),
  • coin money and regulate its value (banking, the regulation of it, cryptocurrency),
  • promote science and the useful arts by securing rights of authors and inventors (the concept of the patent and the regulation (and encouragement) of innovation), and
  • regulate commerce with foreign nations and among the several states (the mighty interstate commerce clause, the bedrock needed for the Uniform Commercial Code, securities regulation, not to mention contracts between parties from differing states – M&A transactions).

Today, business lawyers help their clients comply with the laws that have been established as a result of these Powers. 

But for the business lawyer, the Rule of Law is more than just black-letter law.   The U.S. Constitution does not directly empower either Congress or the Executive branch to create departments and administrative agencies (such as the IRS, NLRB, SEC, USDA, FDIC, FDA, or EPA), but the U.S. Supreme Court has generally recognized that Congress has the authority to establish federal agencies.[3] Just about every business lawyer engages with one or more these agencies or departments and the rules and regulations promulgated by them in servicing their clients.  And for many lawyers, these agencies are their clients (or “we, the people” are since agencies and departments do the work of the people), so by extrapolation business lawyers who work for federal agencies like the Securities and Exchange Commission are doubly embedded into the Rule of Law construct. 

The “power” of the 10th Amendment does more than just create federal areas of law within which business lawyers practice. Because the U.S. Constitution is silent on the power of any federal branch to charter corporations, the 10th Amendment assures that each State reserves the power to charter and govern corporations (and in modern times, other business entities).  It should not be surprising that Delaware, the First State,[4] includes in its constitution an entire separate article on Corporations.  Corporate governance would be a far less important part of a business lawyers’ everyday practice without the Rule of Law principles that created the parallel yet diverging State and Federal legal structures business lawyers pilot their clients through.     

Because Lincoln Said So

Yet another Law Day proclamation brings home for business lawyers why they should identify as agents of the Rule of Law. In Proclamation 8367 of April 30, 2009, for Law Day, U.S.A, 2009, President Obama’s theme for Law Day encouraged Americans to reflect upon the legacy of President Abraham Lincoln, describing Lincoln as “one of the greatest Presidents and one of the greatest lawyers, in our Nation’s history.”  Lincoln’s legacy embodies the Rule of Law and how Lincoln’s vision of a more perfect union “bound together by a recognition of the common good, guided our country through its darkest hour and helped it re-emerge as the beacon of freedom and equality under law.”  This greatest lawyer in our Nation’s history, a luminary of the Rule of Law, told us that “law is nothing else but the best reason of wise men applied for ages to the transactions and business of mankind,” signaling to all licensed lawyers[5]– even those lawyers whose personal practices are transactional or business law – that it is the lawyer’s job to assist clients (each of whom are members of mankind) through our Rules of Law. 

Most basically, Lincoln told us that for all lawyers, but especially business lawyers, the Rule of Law is our business. 


[1] The Federalist: A Collection of Essays Written in Favour of the New Constitution, is a series of essays written by Alexander Hamilton, John Jay, and James Madison between October 1787 and May 1788. The Federalist Papers were published to urge New Yorkers to ratify the proposed United States Constitution.

[2] “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

[3] Myers v. United States, 272 U.S. 52, 129 (1926) (“To Congress under its legislative power is given the establishment of offices, the determination of their functions and jurisdiction, the prescribing of reasonable and relevant qualifications and rules of eligibility of appointees, and the fixing of the term for which they are to be appointed and their compensation.”).

[4] Delaware is known as the First State not because of its status as the jurisdiction of choice for business formation but because on December 7, 1787, it was the first state to ratify the U.S. Constitution.

[5] In the United States, a person who holds themselves out as a “lawyer” must be admitted (have a license) to practice law in at least one State.  Licensure requires the lawyer to take an oath to support the Constitutions of the United States and the particular state of licensure.  Every state prohibits the unlicensed practice of law.    

By: Kimberly Lowe

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