Dynamic Business Law The Essentials, 5th Edition, Nancy Kubasek
Chapter 1-25
Chapter 1: An Introduction to the Fundamentals of Dynamic Business Law and
Business Ethics
1. CHAPTER OVERVIEW
Chapter 1 lays the foundation for the textbook. The textbook emphasizes ways in which business
law intersects with the six functional areas of business. Throughout the textbook, the authors will
encourage students to ―connect to the core,‖ and remember the ways in which law intersects with
other areas of study, including corporate management, production and transportation, marketing,
research and development, accounting and finance, and human resource management.
This manual supports the ―connecting to the core‖ theme by giving ideas for assignments that
encourage students to integrate their business law knowledge with knowledge they are acquiring
from their other business classes. The manual also encourages professors to improve their
teaching skills. Finally, the manual suggests teaching ideas for both beginning and experienced
teachers.
2. LEARNING OBJECTIVES
After reading this chapter, students will be able to answer the following questions:
1. What is business law?
2. How does business law relate to business education?
3. What are the purposes of law?
4. What are alternative ways to classify law?
5. What are the sources of law?
6. What are the various schools of jurisprudence?
3. LECTURE NOTES WITH DEFINITIONS
a. In the news…
Teaching tip: For each chapter, consider asking students to relate current news items to material
from the chapter.
In addition to ideas students come up with on their own, consider weaving in news stories
provided by the McGraw-Hill. Stories are available via a McGraw-Hill DVD, and on the
publisher‘s web site.
,For Chapter One, McGraw-Hill offers the following stories:
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―Smoking Ban: Tobacco Tyrants: Gone Too Far? Many States Are Putting Stronger
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Restrictions on Where You Can Smoke‖
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• Have states gone too far in banning smoking? @lp @lp @lp @lp @lp @lp @lp
• Whose interests are state legislatures looking out for in banning smoking?
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―College Officer Dealings With Lenders Scrutinized.‖
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• Should regulators take a more careful look at college officers? @lp @lp @lp @lp @lp @lp @lp @lp @lp
• Why created changes in the ways college officers interact with lenders?
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b. What is business law? @lp @lp @lp
Business law consists of the enforceable rules of conduct that govern the actions of
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buyers and sellers in market exchanges.
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c. How does business law relate to business education? @lp @lp @lp @lp @lp @lp @lp
Business law applies to the six functional areas of business:
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• Management
• Production and transportation @lp @lp
• Marketing
• Research and development @lp @lp
• Accounting and finance @lp @lp
• Human resource management @lp @lp
d. What are the purposes of law? @lp @lp @lp @lp @lp
• Providing order @lp
• Serving as an alternative to fighting
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• Facilitating a sense that change is possible @lp @lp @lp @lp @lp @lp
• Encouraging social justice @lp @lp
• Guaranteeing personal freedoms @lp @lp
• Serving as a moral guide @lp @lp @lp @lp
e. What are alternative ways to classify law? @lp @lp @lp @lp @lp @lp
One way to classify law:
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Private law involves disputes between private individuals or groups.
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Public law involves disputes between private individuals or groups and their government.
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A second way to classify law:
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Civil law is the body of laws that govern the rights and responsibilities either between
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persons or between persons and their government.
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Criminal law is the body of laws that involve the rights and responsibilities an
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individual has with respect to the public as a whole.
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,Teaching tip: Ask students to give an example of a fact situation that led to both
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criminal and civil lawsuits, e.g., the O.J. Simpson trials.
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f. What are the sources of law? @lp @lp @lp @lp @lp
Sources of business law are: @lp @lp @lp @lp
1. Constitutions
Constitutional law refers to the general limits and powers of governments as stated in
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their written constitutions.
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2. Statutes or legislative actions @lp @lp @lp
Statutes or legislative actions refer to the assortment of rules and regulations put forth
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by legislatures.
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3. Cases
Case law (or common law) is the collection of legal interpretations made by judges.
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Precedent is a tool used by judges to make rulings on cases on the basis of key
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similarities to previous cases.
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Stare decisis is a principle stating that rulings made in higher courts are binding
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precedent for lower courts.
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Teaching tip: The first time your students encounter an appellate case in the
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readings, show them what stare decisis looks like in the context of a real case.
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4. Administrative law @lp
Administrative law is the collection of rules and decisions made by administrative
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agencies to fill in particular details missing from constitutions and statutes.
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5. Treaties
A treaty is a binding agreement between two states or international organizations.
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6. Executive orders @lp
An executive order is a directive that comes from the president or state governor.
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g. What are the various schools of legal interpretation? @lp @lp @lp @lp @lp @lp @lp
Some @lp
schools of legal interpretation include:
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• Identification with the Vulnerable— emphasis on fairness and looking out for
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those with the least power.
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• Historical School/ Tradition—emphasis on the use of traditions and stare decisis.
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• Legal Realism—judges consider context such as social and economic conditions.
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• Cost-benefit Analysis—emphasis is on assigning monetary values to costs and
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benefits of the law in order to make calculations to maximize the ratio of
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benefits to costs.
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Teaching tip: Consider using ―The Case of the Speluncean Explorers (link below) to
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make the schools of jurisprudence come alive.
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h. Appendix on Critical Thinking and Business Law @lp @lp @lp @lp @lp @lp
Critical thinking includes the application of evaluative standards to assess the quality or
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the reasoning being offered to support the conclusion. Critical thinkers will follow this
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pattern of careful thinking when they read an argument:
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1. Find the facts. @lp @lp
2. Look fore the issue. @lp @lp @lp
, 3. Identify the judge‘s reasons and conclusion.
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4. Locate in the decision the rules of law that govern the judge‘s reasoning.
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5. Apply critical thinking to the reasoning. Evaluate the reasoning.
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• Look for potential ambiguity. @lp @lp @lp
• Consider the strength of analogies. @lp @lp @lp @lp
• Check the quality of the judge‘s reasoning. @lp @lp @lp @lp @lp @lp
• Decide whether important information is missing.
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• Consider the possibility of rival causes. @lp @lp @lp @lp @lp
4. TEACHING SKILLS: BLOOM’S TAXONOMY SETS THE @ l p @ l p @ l p @ l p @ l p
STAGE TO THINK ABOUT THE KINDS OF QUESTIONS TO
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ASK YOUR STUDENTS
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Benjamin Bloom, in his Taxonomy of Educational Objectives,* developed a hierarchy of
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cognitive functions. His work sets the stage for teachers to understand why it is
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important to think carefully about the kinds of questions they ask in class.
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The Objective
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Sample questions @lp
Knowledge • What is business law? @lp @lp @lp
Lowest level of learning and is mostly
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• What are the four elements of a @lp @lp @lp @lp @lp @lp
memory. The student recognizes and recalls
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negligence claim?
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information.
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Comprehension • What is your understanding of the
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Lowest level of understanding. The student
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paraphrases or explains something.
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• What does your textbook mean
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by deontology?
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Application • How would a natural law thinker
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Student demonstrates her understanding of
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abstract rules, principles, or generalizations
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by using them to solve life-like problems.
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• Use a particular case rule to determine
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whether the plaintiff will be successful in
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her claim.
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Analysis • Provide the reasoning for the @lp @lp @lp @lp
Student breaks down a communication to
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discover the hidden structure as well as
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assumptions.
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• Break down a particular judge‘s opinion
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to
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understand the assumptions the judge is @lp @lp @lp @lp @lp
making.
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Synthesis • Explain how two particular schools of
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Student creatively combines elements and
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parts to form a whole new structure.
@lp @lp @lp @lp @lp @lp @lp • Make a connection between duress
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and insanity.
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Evaluation • Identify and explain a reasoning flaw in
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Highest level of learning. Student makes a
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critical judgment about the value of the
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