Law is the system of rules created and enforced through social or governmental institutions to regulate behavior, often with punishments for violations. Laws may be created by a collective legislature through statutes, or they can be derived from precedent established in the courts through case law. Private individuals also create legally binding contracts that are enforceable by law.
For example, contract law lays out how people can exchange goods and services in return for something of value; property law defines the rights and duties of people toward tangible assets like cars and houses; tort law deals with injuries caused by the actions of others (like car accidents); and criminal laws define offenses against a state or its citizens. Laws are also used to keep a society peaceful and maintain the status quo, protect minorities against majorities, and promote social change in a controlled manner. Some legal systems serve these purposes better than others.
A key to understanding Law is recognizing that there are different types of law. Some countries, such as the United States, operate under a common law system, which puts judicial decisions on equal footing with legislative statutes and regulations. Other countries, such as Japan, operate under a civil law system that relies on codes of rules to guide judges in their case-by-case decisions. In either type of system, the final determinations made by a judge are binding on lower courts under a doctrine called stare decisis.