Operation of Law: Legal Definition & Examples

Updated January 30, 2024
8 min read
Operation of Law: Legal Definition & Examples

Introduction

Just as you press the “Start” button on your coffee machine and it automatically begins to work, or the way your computer updates itself while you're asleep, certain “operations” function automatically. The term operation of law works similarly in the legal world. 

The operation of law meaning refers to automatic legal processes or consequences that require no specific actions from the involved individuals. This automatic application of the law can involve predefined rights, responsibilities, or changes in legal status.

What Is Operation of Law?

The operation of law definition pertains to the legal principles that apply automatically without the need for action by any entities involved. Essentially, it concerns aspects of law automatically bestowed upon individuals, such as rights and responsibilities. So, when you ask what does operation of law means, it refers to the automatic application of legal rules and consequences to certain situations, typically without the need for specific action or agreement from the parties involved.

For instance, when you hire an attorney, you will likely see the phrase “operation of law” in your power of attorney documents. This is quite common and is an addition included by attorneys at the end of a power of attorney document stipulating when or if the power of attorney expires. They might stipulate that the attorney for Michael (the client) and all of their power shall remain in effect unless Michael revokes the power of attorney or the power of attorney expires by operation of law.

What Does the Operation of Law Mean for You?

At its core, the principle of “operation of law” signifies the automatic application of legal rules, enabling individuals to inherit certain rights or responsibilities irrespective of their intentions. It can also lay down certain perimeters on individual actions, imposing restrictions or permissions. Consider the following brief operation of law examples in practice:

For example, If John passes away without a will, his heirs will be determined through law. The operation of the law states that if he has no surviving spouse but has a surviving child, that child will inherit everything that John has, regardless of whether that child wants to inherit his assets. This child would now be responsible for dealing with the entire estate, liquidating assets, and dividing belongings among John's grandchildren as he sees fit, a responsibility he might not want but is now legally responsible for.

Indeed, the mechanism of operation of law is not limited to property alone; it extends to other domains like patents. Here, it may regulate matters concerning patent ownership transitions or impose terms on patent expiry.

For instance, the title to a patent can be transferred or given through a financial transaction when one company merges with another. However, if a company that owns a patent files for bankruptcy, the ownership of that patent after the company has liquidated its assets is based on the operation of the law of the state. The law will determine who now owns the patent.

What Is the Operation of Law in Real Estate?

The principle of operation of law, which often applies to property transactions, refers to the automatic transfer or imposition of restrictions. A prevalent example is the right of survivorship in a joint tenancy situation. For instance, when Linda and her sister Anna inherit their mother's property, the law automatically steps in when Anna passes away. Irrespective of Linda's initial intentions, she becomes the sole owner of the property.

Another aspect where the operations of law comes into play in real estate is seen in “tenants in common” situations. Here, if one of the co-owners dies, their share of the property doesn't transfer to the surviving owner, as might be expected in a joint tenancy. Instead, the deceased owner's share is transferred to their estate. This again illustrates the operation of law in action, providing an automated legal solution regardless of personal expectations or intentions.

How Does Termination Occur by Operation of Law?

Operation of law can also impact the responsibilities or obligations of different parties to an agency contract. For instance, termination of an agency by way of operation of law can occur when parties provide for termination, when there is a defined cause, or when the agent’s performance has been executed.

However, if a contract cannot be enforced, the operation of the law will terminate it. This can include situations where one or more of the parties involved in the contract were not of sound mind, they were not of legal age, or they were under the influence of drugs or alcohol. Furthermore, if one party was threatened or forced to enter into a contract, the operation of law, assuming this can be proven, can terminate the requirements or responsibilities associated with the contract.

So, termination by operation of law can come into effect under several circumstances:

  1. Expiration: A contract ends when the specified duration expires without either party needing to take action.

  2. Merger or acquisition: If a company involved in a contract merges with another or is acquired, the contract might automatically terminate.

  3. Bankruptcy: If one of the contract parties goes bankrupt, the contract could end automatically.

  4. Death: In some cases, such as employment contracts, the death of the party might lead to immediate termination.

What Does Discharge by Operation of Law Indicate?

A similar legal concept is discharged by way of operation of law. While termination by operation of law means the responsibilities or requirements are now terminated because the contract is terminated, discharge indicates that an individual or party is freed or liberated from different obligations in a situation that differs from any of those mentioned above.

The most common example of this is when someone files for bankruptcy. When someone files for bankruptcy, any debt they have is discharged by operation of law. This means that the contract to repay the money was not fulfilled or terminated, but rather, the person is no longer legally required to pay their creditors. In short, the debt has been discharged by operation of law.

Conclusion

The legal definition for the operation of law can have many iterations as it applies to different scenarios. If you are worried about your legal rights or things like adverse possession or a legal obligation you might have due to the operation of law, you should consider reaching out for legal help from a reliable resource vendor and a qualified attorney

An attorney will better understand and be able to counsel you on the legal rules and fees associated with situations such as reasonable notice, the act you must follow based on the operation of law, and what to do with different assets that fall under the operation of law.

Article by
Ilona Riznyk
Lawrina

Ilona Riznyk is a Content Specialist at Lawrina. In her role, she creates and manages various types of content across the website, ranging from blog articles to user guides. Ilona's expertise lies in meticulous fact-checking, ensuring all the published content is accurate and reliable. 

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