Daniel Oran - Oran's Dictionary of the Law

428 Rigging the market

process and usually unrelated to the subject of the bill, but “tacked on” anyway.

Rigging the market Artificially driving up the price of a stock by making a series of bids that make it look like demand for the stock has soared.

Right 1. Morally, ethically, or legally just. 2. One person’s legal ability to control certain actions of another person or of all other persons. Most rights have a corresponding duty. (When lawyers speak of “a right,” they mean a legal, not moral right.) 3. For Bill of Rights, riparian rights, stock rights, the right to privacy, right to counsel, right to travel, or the rights of election, redemption, survivorship, etc., see those words. For right to die, see advance directive.

Right from wrong test M’Naghten’s rule.

Right of action A claim that can be enforced in court.

Right of first refusal The right to have the first chance to buy property when it goes on sale, or the right to meet any other offer.

Right of way 1. The right to cross another person’s property. 2. The part of a property that others have a right to cross. 3. The land on which a railroad is built. 4. The right of a vehicle (or person) that has a legal right to proceed or go first. The right might be to enter an intersection, use a waterway, etc.

Right to work laws State laws that forbid: labor agreements requiring union membership, forced payment of union dues by nonmembers of a union, preferential hiring, or similar provisions. See also union shop.

Rights issue (or offer) An issue of stock (or other securities) that is sold only to current stockholders.

Ringing up Brokers exchanging sales contracts in order to cancel them out, with leftover differences paid.

Riot A vague word for a public disturbance, especially a violent one created by three or more persons acting together.

Riparian Having to do with the bank of a river or stream. Riparian rights are a landowner’s rights to use water and the land around and under it. Compare with water rights. [pronounce: ri-pare-ee-in]

Ripe 1. A case is ripe for selection and decision by the U.S. Supreme Court if the legal issues involved are clear enough and well enough evolved and presented so that a clear decision can come out of the case. Any court or agency that has the power to turn down cases may use ripeness as a way of deciding whether to take the case. Ripeness

Rogatory letters 429

also includes the idea that the case involves a real controversy, not merely potential harm. 2. A case is ripe for decision by a trial court if everything is completed and in order, and nothing remains but the decision itself.

Rising of court 1. The final adjournment of a court term. 2. Any break in the court’s work (for the day, for a recess, etc.). 3. The start or stop of court business when a court official calls out “all rise” and the judge enters or exits.

Risk 1. In insurance: A hazard (fire); the danger of hazard or loss (one chance in ten thousand per year); the specific possible hazard or loss mentioned in an insurance policy (John’s house burning down); or the item insured itself (the house). 2. In investing: financial (or credit) risk is the risk that the issuer of a security will not be able to pay the investors; market risk is the risk that an investment will go down in value because the whole market for that type of investment goes down; inflation risk is the risk that an investment payout will buy less in the future; economic risk is risk associated with changes in national and world events; interest rate risk is the risk that as interest rates rise, most investment values fall; etc. 3. Risk capital is money or property invested in a business (usually as stock or a share of the business) as opposed to loans or bonds (even “risky” bonds are not risk capital). Also see venture capital and risk arbitrage. 4. Risk of loss usually refers to the responsibility for loss or damage during a property transfer between seller and buyer.

Robbery The illegal taking of property from the person of another by using force or threat of force.

Robert’s rules Short for Robert’s Rules of Order. A set of rules by which many legislatures and other meetings are conducted. They are official parliamentary law only where they have been specifically adopted.

Robinson-Patman Act (15 U.S.C. 13 & 21) A 1936 federal law that prohibits price discrimination and other anticompetitive practices in business.

Roe v. Wade (410 U.S. 113) A 1973 Supreme Court decision that said that the right of privacy (that is possessed by all, implied by the Constitution, and recognized in earlier cases) includes the right of a woman to get an abortion in the first trimester of pregnancy.

Rogatory letters A request from one judge to another asking that the second judge supervise the examination of a witness (usually in another state and usually by interrogatories).

430 Roll

Roll 1. A record of official proceedings. 2. A list of persons or property subject to a tax. 3. A roll call is calling off a list of names, usually to take a vote or to see if there is a quorum to vote.

Rollback A temporary lowering of an amount of money regularly paid.

Rolling over 1. Extending a short-term loan for another short period. Rollover paper is a short-term note that can be extended. 2. Refinancing a debt. 3. Making certain nontaxable transfers from one retirement fund to another.

Roman law Laws of the Roman Empire that form the basis for the civil law of several European countries and for many legal words and ideas in the U.S., especially in Louisiana.

Romer v. Evans (517 U.S. 620) A 1995 U.S. Supreme Court decision that struck down as a violation of equal protection of laws a Colorado state law that prohibited local laws protecting homosexuals against discrimination.

Roomer A lodger. A person who rents rooms in a house, as opposed to a tenant (see that word). Roomers have fewer legal rights than tenants, especially with respect to eviction and the right to deny others access to the room.

Root of title The recorded land transaction (usually the most recent one that is at least forty years old) relied on as the original basis for a claim to land ownership.

Rota (Latin) The order of rotation or succession for a job or temporary office.

Round lot A normal unit of trading in stocks or bonds. Fewer shares are an odd lot.

Royalty A payment made to the creator of a work or the owner of a natural material for the use of that work or material. For example, a publisher might pay an author a royalty of 10 percent of the retail price of each book sold, a manufacturer might pay an inventor a royalty of $10 per invention sold, and a mining company might pay a landowner 10¢ per pound of a mineral extracted.

Rubric 1. Overall purpose. 2. Title. 3. Category. 4. Rule no. 2.

Rule 1. To settle a legal issue or decide a motion, objection, etc., raised by one side in a dispute. The ruling is made by the person in charge (judge, hearing officer, chairperson, etc.). 2. An established standard, principle, or guide. A rule may be accepted in one jurisdiction, rejected in another, and modified in a third. 3. A regulation made by a group or by an administrative agency, often to govern its internal workings.

Rule of 78 431

Rule against accumulations A state law that prevents a trust from storing up money for too long. It is similar to the rule against perpetuities. See perpetuity.

Rule against perpetuities See perpetuity. Rule in Shelley’s case See Shelley’s case. Rule in Wild’s case See Wild’s case.

Rule of completeness See rule of optional completeness.

Rule of four The principle that if at least four of the nine U.S. Supreme Court justices vote to take a case, the court will hear the case. The Court uses the rule of four for cases that reach the Court by certiorari

(see that word).

Rule of law 1. A general legal principle, often stated as a maxim or “rule of thumb,” that is used as a guide in deciding legal issues. 2. A general statement that is intended to guide conduct, applied by government officials, and supported by an authoritative source. 3. The principle that the highest authority is the law, not the government or its leaders.

Rule of lenity The principle that if it is not clear how greatly a law punishes conduct, a judge should choose the more lenient interpretation.

Rule of marshaling assets (and liens) See marshaling (and inverse order of alienation).

Rule of optional completeness The rule that when one side in a lawsuit uses part of a document (such as a deposition transcript) as evidence, the other side may require that the rest of the document be made part of the evidence as well.

Rule of reason 1. The principle that actions must be reasonable to be legal. 2. The principle that a conclusion must be based on logical reasoning. 3. The principle that some kinds of restrictive trade practices are not per se (see that word) violations of the Sherman Act unless the facts of that particular case show that they are an unreasonable restraint of trade.

Rule of 78 A method of computing interest on a loan, especially on an installment loan that is repaid early. It is calculated as follows: the sum of the months in a year (1–12) is 78. If repayment is made in the first month of a one-year loan, 12/78ths of the total interest must be paid; in the second month, another 11/78ths, etc. This is more than paying 1/12th for each month the money was used.

432 Rule of 72

Rule of 72 A way to calculate how many years of a certain percentage rate of compound interest will double an investment (divide the interest into 72 to get the number of years) or what compound interest is needed to double an investment in a certain number of years (divide the number of years into 72 to get the interest).

Rule of the sum of the digits Rule of 78.

Rulemaking Legislative activity by an administrative agency that sets future policy, as opposed to an adjudication of past actions.

Rules committee A committee of a house of a legislature that acts as a preliminary sifting place to decide which bills from the various committees will be voted on by the house, and in which order.

Rules (federal) See federal rules.

Rules of Decisions Act The 1948 federal law (28 U.S.C. 1652) that makes state substantive law applicable to federal lawsuits based on diversity of citizenship.

Rules of Professional Conduct American Bar Association rules stating and explaining what lawyers must do, must not do, should do, and should not do. They cover the field of legal ethics (a lawyer’s obligations to clients, courts, other lawyers, and the public) and have been adopted in modified forms by most of the states.

Ruling A judge’s decision on a legal question raised during a trial. Run 1. To have legal validity. For example, the law runs throughout the

state. 2. To continue to count. For example, “the statute of limitations is running” means that days are being counted against the maximum allowable number of days before the statute prohibits a lawsuit. (But see no. 3.) 3. A specified time period has expired. For example, “the statute of limitations has run” means that it has been too long since the acts on which a lawsuit is based for the lawsuit to be permitted. (But see no. 2.) 4. To be attached to another thing. For example, a covenant (see that word) may run with the land and stay with the land even if the land’s ownership changes.

Runaway shop A business that closes and moves away to avoid unionization, high union wages, etc.

Running account An open, as yet unsettled account; a charge account.

Rylands v. Fletcher The old English case that established the principle of strict liability for inherently dangerous things and abnormally dangerous activities.

434 S corporation

S corporation A small (defined by number of owners) business corporation that has chosen a tax status that allows it to be taxed essentially as a partnership to avoid the corporate income tax.

Sabotage 1. The intentional destruction of or interference with national defense production, material, or premises. 2. The intentional destruction of or interference with an employer’s property or operations during a labor dispute (see that word).

Saenz v. Roe (119 S.Ct. 1518) The 1999 U.S. Supreme Court decision that a state violates the privileges and immunities clause by limiting first-year welfare benefits to what would have been received in the recipient’s home state.

Safe harbor 1. An approved way of complying with a statute when the statute is phrased in general terms. For example, S.E.C. regulations (see that word) list ways that are sure to keep you out of trouble when making certain types of stock offerings (even though other ways might be legal also). 2. A statement in a statute or regulation that a good faith attempt to comply is sufficient, even if the attempt has failed.

Safe investment rule 1. Prudent person rule. 2. A method of calculating future earnings by estimating what sum of money, safely invested, would equal the earnings.

Said An unnecessary word for “the one mentioned before”; for example, “said table.” Avoid the phrase because “the” or “this” will usually do.

Sailor’s will See military will.

Salary Fixed annual compensation earned by an employee (often a manager or other professional) and paid weekly, monthly, etc. Compare wage.

Sale 1. An exchange of property for money (or the contract that expresses the exchange). 2. For approval, bootstrap, bulk transfer, consignment, foreclosure, judicial, short, and other types of sales, see those words. 3. A sale and return is a sale in which the buyer may return any unused items if bought for resale; a sale-note is a summary of a sale, given by a broker to the seller and buyer; and a sale against the box is a short sale in which the seller actually owns that stock. 4. “Sales” is a field of law, now covered primarily by the Uniform Commercial Code, which governs the sale of goods.

Sales finance company 1. A company that buys the rights to accounts receivable (money owed by customers to a merchant) at a discount and then tries to collect the debts. 2. A finance company that specializes in financing consumer sales.

Satisfaction 435

Sales tax A state or local tax on goods sold, equal to a certain percentage of the sale price. It is usually collected by the merchant. Some states tax items (such as cars) at different rates, and some states do not tax some items (such as food) at all. Compare with excise.

Salvage 1. Property recovered after an accident or other damage or destruction. 2. Business property that has only scrap value, or, sometimes, business property that is disposed of simply because it has been replaced or is of no further use to the company, whether or not it is still valuable. 3. Money paid to someone who rescues property from destruction at sea. 4. Equitable salvage is a lien in favor of the last person to make a payment that prevents the loss of property through lapse, foreclosure, etc.

Same evidence test The principle that if exactly the same evidence would convict a person in two separate prosecutions, the second prosecution is prohibited because of double jeopardy.

Sample An item representative of other items. A sale by sample usually means that the items bought must “conform to” the sample. In commercial law, this may mean “substantially identical,” and it may mean “similar and accepted in the trade as of equal quality.”

Sanction 1. To agree to or confirm another person’s actions. 2. A penalty or punishment attached to a law to make sure it is obeyed.

Sanctions tort A court-ordered payment by the side in a lawsuit that abused the discovery process, made to the side that was hurt by the abuse.

Sandwich lease A lease in which the person who rents a property rerents (sublets) it to another for more money; for example, leasing a shopping center and renting out the stores in it.

Sanitary code Local laws regulating the cleanliness of places where food is handled or where medical services are provided.

Sanity 1. Soundness of mind; the opposite of insanity (see that word). 2. A sanity hearing is a court proceeding to determine whether a person is mentally fit to stand trial, is committable to a mental hospital, etc. Also called a competency proceeding, a sanity trial (where it is a separate proceeding), and other names. Competency may be different from sanity.

Satellite Related, but secondary or peripheral.

Satisfaction 1. Taking care of a debt or obligation by paying it. See also accord and satisfaction. 2. A satisfaction contract is one in which one person promises to do work or supply goods that will satisfy another. “Satisfactory” in this sense does not usually mean “to every personal

436 Satisfactory

whim” but “to any reasonable need” or “according to the judgment of an impartial expert.” 3. A satisfaction of judgment, lien, or mortgage is a written document signed by the person paid, stating that an obligation has been paid. A satisfaction piece is a written document, made to be recorded, similar to the one above or stating that two sides in a lawsuit have agreed that payments have been made, and the lawsuit should be ended.

Satisfactory A general word for “enough” or “good enough.”

Save Hold until later; reserve; preserve.

Save harmless Hold harmless.

Saving (or separability or severability) clause 1. A clause in a statute (or a contract) that states that if part of the statute (or contract) is declared void, the remainder stays in effect. See also severable. 2. A clause in a statute that preserves certain rights, responsibilities, or liabilities that are in existence as of the adoption of the statute but would otherwise be lost upon its adoption. Sometimes, a grandfather clause.

Saving property rule The little-used principle that a person is liable not only for damage done to an owner’s property, but also for the owner’s injuries caused by an attempt to save the property.

Saving to suitors clause A federal law (28 U.S.C. 1333) that allows persons to bring admiralty (maritime) lawsuits in either a state or federal court, but that requires state courts to use federal substantive law for these lawsuits. (Other types of cases that can be brought in either state or federal court must use state substantive law in either place.)

Savings and loan association A financial institution, similar to a bank, that historically engaged primarily in making loans to home buyers. They are federally and state-chartered.

Savings bank (or account) trust A Totten trust.

Sc. Scilicet.

Scab Slang for a person who works for less than union wages, works under conditions prohibited under a union contract, takes the place of a striking union worker, passes through a union picket line, etc.

Scale order See order.

Scale-down A composition.

Scalper 1. A small-scale speculator in stocks, bonds, theater tickets, etc. See speculate. 2. An investment advisor who buys securities such as stocks, and then recommends them without disclosing the fact that a price rise will be to his or her benefit.

Scorched earth policy 437

Scandal Defamation.

Scènes a faire General ideas or common themes (such as sequences of events that obviously follow from a given situation) that cannot be copyrighted. [pronounce: senz ah fair]

Scenic easement A type of government restriction on private land use imposed to preserve natural areas.

Schedule 1. A list. 2. A list attached to a document that explains in detail things contained in the document. For example, scheduled property is items on a list attached to an insurance policy, with the value of each item and what the company will pay if it is lost or hurt. The supporting pages of calculations attached to the main sheet of a tax return are called schedules, as are the charts for looking up the amount of tax owed.

Scheme 1. Any general plan or system, especially a business plan. 2. A plan to trick or defraud someone. 3. See common scheme.

Schempp v. Abington School District (374 U.S. 203) A 1963 Supreme Court decision that forbade Bible reading and prayer in public school classes.

Schenck v. U.S. See clear and present danger test.

Scienter (Latin) Knowingly; with guilty knowledge. [pronounce: si-en-ter] Scilicet (Latin) “That is to say.” An unnecessary word, often used after a general statement to introduce a list of specific examples. [pro-

nounce: sill-is-it]

Scintilla A very little bit. The word is often used in the phrase “a mere scintilla of evidence” (“is enough to let the jury decide the case”; “is not enough to let the jury decide the case”).

Scire facias (Latin) Describes a judge’s command to a public official to come to court and explain why a record in that person’s possession should not be disclosed, given force, wiped out, etc. [pronounce: siree fay-she-es]

Scope of employment The range of actions within which an employee is considered to be doing work for the employer. See respondeat superior.

Scope of review The issues a court may handle and the actions it may take when reviewing the decisions of a lower court or administrative agency.

Scorched earth policy A company policy that, in the event of a hostile takeover, it will sell off those assets that make the company attractive for takeover.