Tajadin Muhammad

Tajadin Muhammad

Business Law

Chapter 6

1. The separation of powers between levels of government is known as federalism. This concept recognizes that each level of government recognizes that it was created by the states and that states have some sovereignty. The Tenth Amendment reserves some powers to the states and to the people. Congress may not impair ability of state government to function in the federal system. Likewise, state government may not limit the federal government's exercise of powers.

2. Under the supremacy clause, courts may be called upon to decide if a state law is invalid because it conflicts with a federal law. They must construe or interpret the two laws to see if they are in conflict. A conflict exists if the state statute would prevent or interfere with the accomplishment and execution of the full purposes and objectives of Congress.

3. Article I, Section 10, of the Constitution says, "No State shall pass any Law impairing the Obligation of contracts," This is the contract clause. It does not apply to the federal government, which does in fact frequently enact laws and adopt regulations that affect existing contracts. Under the contract clause, states cannot enact laws that impact rights and duties under existing contracts. The limitation on state action impairing contracts has not been given a literal application. As a result of judicial interpretation, some state laws that affect existing contracts have been approved, especially when the law is passed to deal with a specific emergency situation.

4. That the federal power to regulate foreign commerce is exclusive means state and local governments may not regulate such commerce. State and local governments sometimes attempt directly or indirectly to regulate imports or exports to some degree. Such attempts general are unconstitutional. However, a state may regulate activities that relate to foreign commerce if such activities are conducted entirely within state's boundaries.

5. The power of Congress over commerce is very broad; it extends to all commerce, be it great or small. Labeling an activity a local or intrastate activity does not prevent congress from regulating it under the commerce clause. The power of Congress to regulate commerce "among the several states" extends to those intrastate activities that affect interstate commerce as to make regulation of them appropriate.

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7. To prevent multiple taxation of the same property or income of interstate business, taxes are apportioned. Apportionment formulas allocate the tax burden of an interstate business among the states entitled to tax it. The commerce clause requires states to use reasonable formulas when more than one state is taxing the same thing. To justify the tax, there must be sufficient