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Chapter 5
Model for Forming Law
Introduction
Step 1: Options
Step 2: Reasons
Policy
Precedent
Rules
Secondary Sources
Step 3: Decision
Application
Introduction
This chapter proposes a model for forming law. This model combines the
tasks of making law and interpreting law. Realistically, it is a combination of
two similar models, the model for making law and the model for interpreting
law.
In principles the model prescribes how a rational legislature and a rational
court would make and interpret law. While this model can function smoothly
on the pages of a textbook, it may not function that way in the real world due
to practical difficulties in implementation. Moreover, it is not only possible but
highly likely in practice that legislatures and courts will not act in a fully rational
manner. Despite these difficulties, the model still presents an ideal to which
legislatures and courts should aspire as far as feasible. Moreover, it is a
framework for understanding both the aims that should be sought and the
means of achieving those aims.
Making and interpreting law constitute purposive action that is designed to
change the world. Consequently, a law should be made and interpreted by
reference to how well or how badly it will do this task. Therefore the best law
or the best interpretation of a law consists of the law or interpretation which
changes the world in the best possible way. This constitutes the basic decision
making rule – a legislature should pass the law, and a court should choose the
meaning, which causes the best effect. This is the effect that yields the highest
net benefit. There is no other way to proceed if society wants to make and
interpret law in a rational manner. 
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