This course will familiarize law students with the basic concepts of corporate finance and explore how they relate to a variety of legal issues. A working knowledge of finance is important for any lawyer specializing in corporate, tax, commercial or bankruptcy law - whether as a litigator, counselor or transactional lawyer. Finance-based issues may also arise in a variety of other everyday contexts. For example, an estate plan or divorce settlement may hinge on the value placed on a family business; disputes may often arise over how corporate assets or cash flow are to be divided among different types of claimants; and a personal injury settlement may be structured in terms of a series of future payments, the value of which is dependent upon which financial assumptions and theories the parties adopt.
Business Organizations I is strongly encouraged as a prerequisite, as is at least one course in accounting or finance, whether at the undergraduate, graduate or law school level. That said, one advantage of a course such as this is to allow law students who did no prior coursework in accounting and finance to develop an understanding of the core concepts of those disciplines before they enter practice. Past experience confirms that students with no business background can in fact do well in the course but they should expect to work a little harder than in their other law school courses.
It is also important to appreciate how this course differs from the traditional law school course, in which cases are used to teach legal principles. In Corporate Finance, the role of the cases is to illustrate the application of the finance principles and examine how they affect the legal outcome. Most units therefore begin with a textual discussion of the relevant financial principles, then follow it with one or more case-law applications. In that sense, learning the law itself is secondary.