SOLUTIONMANUAL o
TheLegalEnvironmentofBusiness,14thEdition
o o o o o o
byRogerE.Meiners, Chapters1-22,Complete
o o o o o o o o
,TABLE OF CONTENTS
o o o
➢ Chapter 1. Today’s Business Environment: Law and Ethics
o o o o o o o
➢ Chapter 2. The Court Systems
o o o o
➢ Chapter 3. Trials and Resolving Disputes
o o o o o
➢ Chapter 4. The Constitution: Focus on Application to Business
o o o o o o o o
➢ Chapter 5. Criminal Law and Business
o o o o o
➢ Chapter 6. Elements of Torts
o o o o
➢ Chapter 7. Business Torts and Product Liability
o o o o o o
➢ Chapter 8. Real and Personal Property
o o o o o
➢ Chapter 9. Intellectual Property
o o o
➢ Chapter 10. Contracts
o o
➢ Chapter 11. Domestic and International Sales
o o o o o
➢ Chapter 12. Business Organizations
o o o
➢ Chapter 13. Negotiable Instruments, Credit, and Bankruptcy
o o o o o o
➢ Chapter 14. Agency and the Employment Relationship
o o o o o o
➢ Chapter 15. Employment and Labor Regulations
o o o o o
➢ Chapter 16. Employment Discrimination
o o o
➢ Chapter 17. The Regulatory Process
o o o o
➢ Chapter 18. Securities Regulation
o o o
➢ Chapter 19. Consumer Protection
o o o
➢ Chapter 20. Antitrust Law
o o o
➢ Chapter 21. Environmental Law
o o o
➢ Chapter 22. The International Legal Environment of Business
o o o o o o o
,CHAPTER 1 o
Table of Contents o o
Answer to Discussion Question ..................................................................................................................... 1
o o o
Answers to Case Questions............................................................................................................................ 1
o o o
Answers to Ethics and Social Questions ......................................................................................................... 3
o o o o o
Answer to Discussion Question o o o
Should the common law maxim “Ignorance of the law is no excuse” apply to an immigrant who speakslittle English and
o o o o o o o o o o o o o o o o o o o o
was not educated in the United States? How about for a tourist who does not speak English? Everyone knows criminal
o o o o o o o o o o o o o o o o o o o o
acts are prohibited, but what about subtler rules that differ across countries and so may be misunderstood by
o o o o o o o o o o o o o o o o o o
foreigners?
o
Answer: It is generally true that ignorance of the law is no excuse. Citizens are deemed to have constructive
o o o o o o o o o o o o o o o o o o
knowledge of the law. Yet, as well known as this rule is, it is surprising how often it is proffered as an excuse. (A
o o o o o o o o o o o o o o o o o o o o o o o o
Westlaw search cases finds hundreds of examples). Examples include: Deluco v. Dezi (Conn. Super) (lack of
o o o o o o o o o o o o o o o o
knowledge regarding the state‘s usury laws is no excuse for the inclusion of an illegal interest rate in a sales
o o o o o o o o o o o o o o o o o o o o
contract); and Plumlee v. Paddock (ignorance of thefact that the subject matter of the contract was illegal was
o o o o o o o o o o o o o o o o o o o
not excuse). The courts have provided a small exception to the rule when it comes to people in lack of English
o o o o o o o o o o o o o o o o o o o o o
language skills. Consider Flanery v. Kuska, (defendant did not speak English was advised by a friend that an
o o o o o o o o o o o o o o o o o o
answer to a complaint was not required); Ramon v. Dept. of Transportation, (no English and an inability to
o o o o o o o o o o o o o o o o o o
understand the law required for an excuse); Yurechko v. County of Allegheny, (Ignorance and with the fact that
o o o o o o o o o o o o o o o o o o
the municipality suffered no hardship in late lawsuit filing was an excuse).
o o o o o o o o o o o o
Answers to Case Questions o o o
1. Facts from an English judge’s decision in 1884: “The crew of an English yacht ..........................were cast away in
o o o o o o o o o o o o o o o o
a storm on the high seas . . . and were compelled to put into an open boat. ........................ They had no supply
o o o o o o o o o o o o o o o o o o o o
of water and no supply of food. . . . That on the eighteenth day . . . they ........................ suggested that one
o o o o o o o o o o o o o o o o o o o o
should be sacrificed to save the rest. . . . That next day . . . they . . . went to the boy ............................ put a knife
o o o o o o o o o o o o o o o o o o o o o o o o o
into his throat and killed him . . . the three men fed upon the body .....................of the boy for four days; [then]
o o o o o o o o o o o o o o o o o o o o o
the boat was picked up by a passing vessel, and [they] were rescued. . . . and committed for trial. . . .
o o o o o o o o o o o o o o o o o o o o o o
if the men had not fed upon the body of the boy they would probably not have survived to be sopicked up
o o o o o o o o o o o o o o o o o o o o o o
and rescued, but would............................. have died of famine. The boy, being in a much weaker
o o o o o o o o o o o o o o
condition, was likely to have died before them ................ The real question in this case [is] whether killing
o o o o o o o o o o o o o o o
under the conditions set forth ............ be or be not murder.” Do you consider the acts to be immoral?
o o o o o o o o o o o o o o o o
[Regina v. Dudley and Stephens, 14 Queens Bench Division 273 (1884)]
o o o o o o o o o o
Answer: This points out that the legal system has limits. Its acceptability is dictated by legal culture--whichdetermines
o o o o o o o o o o o o o o o o o
whether law will be enforced, obeyed, avoided, or abused. It is limited by the informal rules of the society--its
o o o o o o o o o o o o o o o o o o o
customs and values. One limit is the extent to which society will allow the formal rules to be imposed when a
o o o o o o o o o o o o o o o o o o o o o
crime is committed in odd circumstances. Here there was an intentional murder. Does the motive for the
o o o o o o o o o o o o o o o o o
murder, the effort to save several lives by sacrificing one
o o o o o o o o o o
, life, make it a crime that should be punished? Not all crimes are treated the same. It also raisesquestions about
o o o o o o o o o o o o o o o o o o o o
othe desirability of not giving judges flexibility in sentencing.
o o o o o o o o
There was a precedent for a light sentence in this case in U.S. law: U.S. v. Holmes, 20 F. Cas. 360 (No. 15383)
o o o o o o o o o o o o o o o o o o o o o o
(C.C.E.D. Pa. 1842). The case involved a sinking ocean liner. Several passengers madeit to the only lifeboat,
o o o o o o o o o o o o o o o o o o
which was far too overcrowded. The captain decided to save the women and children and threw several men
o o o o o o o o o o o o o o o o o o
overboard. The lifeboat was rescued. The grand jury refused to indict the captain from murder, only for
o o o o o o o o o o o o o o o o o
manslaughter. He got a six month sentence.
o o o o o o o
The British judge in the case here imposed the death penalty upon the person who survived. The judge
o o o o o o o o o o o o o o o o o
found it difficult to rule that every man on board had the right to make law by his own hand. The Crown
o o o o o o o o o o o o o o o o o o o o o o
reduced the sentence to six months.
o o o o o o
2. Smoking is a serious health hazard. Cigarettes are legal. Should cigarette manufacturers be liable for the serious
o o o o o o o o o o o o o o o o
illnesses and untimely deaths caused by their unavoidably dangerous products, eventhough they post a warning
o o o o o o o o o o o o o o o o
on the package and consumers voluntarily assume the health risks by smoking? [Cipollone v. Liggett Group,
o o o o o o o o o o o o o o o o
Inc., 505 U.S. 504 (1992)]
o o o o o
Answer: The general rule that exists now is that since the government has ordered the posting of warninglabels on
o o o o o o o o o o o o o o o o o o o
cigarettes, and since the dangers of smoking are well known, consumers have been warned and are not due
o o o o o o o o o o o o o o o o o o
compensation if they kill themselves by smoking. The Cippoline case, since reviewed by the Supreme Court,
o o o o o o o o o o o o o o o o
appears to be of limited impact since the victim was adjudged to have become addicted to cigarettes before
o o o o o o o o o o o o o o o o o o
the warning label was ordered in 1964. If cigarette makers were held responsible for all health problems
o o o o o o o o o o o o o o o o o
associated with cigarettes, then, like alcohol and other dangerous products, the damages would likely be so
o o o o o o o o o o o o o o o o
high it would effectively ban the products. Presumably, in a free society if adults are clearly informed of the
o o o o o o o o o o o o o o o o o o o
risks of products that cannot be made safe, they accept the risk. Tobacco and alcohol producers cannot take
o o o o o o o o o o o o o o o o o o
the dangers out of the products except at the margin by encouraging responsible drinking and the like. Are
o o o o o o o o o o o o o o o o o o
drugs like cocaine different?
o o o o
3. Two eight-year-old boys were seriously injured when riding Honda mini-trail bikes. The boys were riding on
o o o o o o o o o o o o o o o
public streets, ran a stop sign, and were hit by a truck. The bikes had clear warning labels on the front stating
o o o o o o o o o o o o o o o o o o o o o o
they were only for off-road use. The manual stated the bikes were not to be usedon public streets. The parents
o o o o o o o o o o o o o o o o o o o o o
sued Honda. The supreme court of Washington said one basic issue existed: “Is a manufacturer liable when
o o o o o o o o o o o o o o o o o
children are injured while riding one of its mini-trail bikes on apublic road in violation of manufacturer and
o o o o o o o o o o o o o o o o o o o
parental warnings?” Is it unethical to make products like mini-trail bikes children will use when we know
o o o o o o o o o o o o o o o o o
accidents like this will happen? [Baughn v. Honda Motor Co., 727 P.2d 655 Sup. Ct, Wash., (1986)]
o o o o o o o o o o o o o o o o o
Answer: The court found no liability for the manufacturers. There was no defect; the product was safe for intended
o o o o o o o o o o o o o o o o o o
use. Safety instructions were clear; the parents let the boys ride the bikes. Anything can bedangerous--
o o o o o o o o o o o o o o o o o
baseballs are dangerous when they hit the head, swings are dangerous when kids jumpout of them; there is
o o o o o o o o o o o o o o o o o o
only so much that can be done to make the government the ―national nanny‖ asthe Washington Post once
o o o o o o o o o o o o o o o o o o o
said about excessive consumer protection. Parents must accept a high degree of responsible for their own
o o o o o o o o o o o o o o o o
children.
o
4. Johnson Controls adopted a “fetal protection policy” that women of childbearing age could not work in the
o o o o o o o o o o o o o o o o
battery-making division of the company. Exposure to lead in the battery operation could causeharm to unborn
o o o o o o o o o o o o o o o o o
babies. The company was concerned about possible legal liability for injury sufferedby babies of mothers who
o o o o o o o o o o o o o o o o o
had worked in the battery division. The Supreme Court held the companypolicy was illegal. It was an “excuse for
o o o o o o o o o o o o o o o o o o o o
denying women equal employment opportunities.” Is the Court forcing the company to be unethical by allowing
o o o o o o o o o o o o o o o o
pregnant women who ignore the warnings to expose their babies to the lead? [United Auto Workers v. Johnson
o o o o o o o o o o o o o o o o o o
Controls, 499 U.S. 187 (1991)]
o o o o o
Answer: The Court held it a form of sex discrimination to prevent women of child-bearing age from holding the
o o o o o o o o o o o o o o o o o o
more dangerous jobs. The company argued that it did this to protect itself from possibleliability in case of
o o o o o o o o o o o o o o o o o o o
damage to babies and that the decision was ethical. The replacements for these workers were often men or
o o o o o o o o o o o o o o o o o o
more senior women, who tended to be higher income workers, so this
o o o o o o o o o o o o
TheLegalEnvironmentofBusiness,14thEdition
o o o o o o
byRogerE.Meiners, Chapters1-22,Complete
o o o o o o o o
,TABLE OF CONTENTS
o o o
➢ Chapter 1. Today’s Business Environment: Law and Ethics
o o o o o o o
➢ Chapter 2. The Court Systems
o o o o
➢ Chapter 3. Trials and Resolving Disputes
o o o o o
➢ Chapter 4. The Constitution: Focus on Application to Business
o o o o o o o o
➢ Chapter 5. Criminal Law and Business
o o o o o
➢ Chapter 6. Elements of Torts
o o o o
➢ Chapter 7. Business Torts and Product Liability
o o o o o o
➢ Chapter 8. Real and Personal Property
o o o o o
➢ Chapter 9. Intellectual Property
o o o
➢ Chapter 10. Contracts
o o
➢ Chapter 11. Domestic and International Sales
o o o o o
➢ Chapter 12. Business Organizations
o o o
➢ Chapter 13. Negotiable Instruments, Credit, and Bankruptcy
o o o o o o
➢ Chapter 14. Agency and the Employment Relationship
o o o o o o
➢ Chapter 15. Employment and Labor Regulations
o o o o o
➢ Chapter 16. Employment Discrimination
o o o
➢ Chapter 17. The Regulatory Process
o o o o
➢ Chapter 18. Securities Regulation
o o o
➢ Chapter 19. Consumer Protection
o o o
➢ Chapter 20. Antitrust Law
o o o
➢ Chapter 21. Environmental Law
o o o
➢ Chapter 22. The International Legal Environment of Business
o o o o o o o
,CHAPTER 1 o
Table of Contents o o
Answer to Discussion Question ..................................................................................................................... 1
o o o
Answers to Case Questions............................................................................................................................ 1
o o o
Answers to Ethics and Social Questions ......................................................................................................... 3
o o o o o
Answer to Discussion Question o o o
Should the common law maxim “Ignorance of the law is no excuse” apply to an immigrant who speakslittle English and
o o o o o o o o o o o o o o o o o o o o
was not educated in the United States? How about for a tourist who does not speak English? Everyone knows criminal
o o o o o o o o o o o o o o o o o o o o
acts are prohibited, but what about subtler rules that differ across countries and so may be misunderstood by
o o o o o o o o o o o o o o o o o o
foreigners?
o
Answer: It is generally true that ignorance of the law is no excuse. Citizens are deemed to have constructive
o o o o o o o o o o o o o o o o o o
knowledge of the law. Yet, as well known as this rule is, it is surprising how often it is proffered as an excuse. (A
o o o o o o o o o o o o o o o o o o o o o o o o
Westlaw search cases finds hundreds of examples). Examples include: Deluco v. Dezi (Conn. Super) (lack of
o o o o o o o o o o o o o o o o
knowledge regarding the state‘s usury laws is no excuse for the inclusion of an illegal interest rate in a sales
o o o o o o o o o o o o o o o o o o o o
contract); and Plumlee v. Paddock (ignorance of thefact that the subject matter of the contract was illegal was
o o o o o o o o o o o o o o o o o o o
not excuse). The courts have provided a small exception to the rule when it comes to people in lack of English
o o o o o o o o o o o o o o o o o o o o o
language skills. Consider Flanery v. Kuska, (defendant did not speak English was advised by a friend that an
o o o o o o o o o o o o o o o o o o
answer to a complaint was not required); Ramon v. Dept. of Transportation, (no English and an inability to
o o o o o o o o o o o o o o o o o o
understand the law required for an excuse); Yurechko v. County of Allegheny, (Ignorance and with the fact that
o o o o o o o o o o o o o o o o o o
the municipality suffered no hardship in late lawsuit filing was an excuse).
o o o o o o o o o o o o
Answers to Case Questions o o o
1. Facts from an English judge’s decision in 1884: “The crew of an English yacht ..........................were cast away in
o o o o o o o o o o o o o o o o
a storm on the high seas . . . and were compelled to put into an open boat. ........................ They had no supply
o o o o o o o o o o o o o o o o o o o o
of water and no supply of food. . . . That on the eighteenth day . . . they ........................ suggested that one
o o o o o o o o o o o o o o o o o o o o
should be sacrificed to save the rest. . . . That next day . . . they . . . went to the boy ............................ put a knife
o o o o o o o o o o o o o o o o o o o o o o o o o
into his throat and killed him . . . the three men fed upon the body .....................of the boy for four days; [then]
o o o o o o o o o o o o o o o o o o o o o
the boat was picked up by a passing vessel, and [they] were rescued. . . . and committed for trial. . . .
o o o o o o o o o o o o o o o o o o o o o o
if the men had not fed upon the body of the boy they would probably not have survived to be sopicked up
o o o o o o o o o o o o o o o o o o o o o o
and rescued, but would............................. have died of famine. The boy, being in a much weaker
o o o o o o o o o o o o o o
condition, was likely to have died before them ................ The real question in this case [is] whether killing
o o o o o o o o o o o o o o o
under the conditions set forth ............ be or be not murder.” Do you consider the acts to be immoral?
o o o o o o o o o o o o o o o o
[Regina v. Dudley and Stephens, 14 Queens Bench Division 273 (1884)]
o o o o o o o o o o
Answer: This points out that the legal system has limits. Its acceptability is dictated by legal culture--whichdetermines
o o o o o o o o o o o o o o o o o
whether law will be enforced, obeyed, avoided, or abused. It is limited by the informal rules of the society--its
o o o o o o o o o o o o o o o o o o o
customs and values. One limit is the extent to which society will allow the formal rules to be imposed when a
o o o o o o o o o o o o o o o o o o o o o
crime is committed in odd circumstances. Here there was an intentional murder. Does the motive for the
o o o o o o o o o o o o o o o o o
murder, the effort to save several lives by sacrificing one
o o o o o o o o o o
, life, make it a crime that should be punished? Not all crimes are treated the same. It also raisesquestions about
o o o o o o o o o o o o o o o o o o o o
othe desirability of not giving judges flexibility in sentencing.
o o o o o o o o
There was a precedent for a light sentence in this case in U.S. law: U.S. v. Holmes, 20 F. Cas. 360 (No. 15383)
o o o o o o o o o o o o o o o o o o o o o o
(C.C.E.D. Pa. 1842). The case involved a sinking ocean liner. Several passengers madeit to the only lifeboat,
o o o o o o o o o o o o o o o o o o
which was far too overcrowded. The captain decided to save the women and children and threw several men
o o o o o o o o o o o o o o o o o o
overboard. The lifeboat was rescued. The grand jury refused to indict the captain from murder, only for
o o o o o o o o o o o o o o o o o
manslaughter. He got a six month sentence.
o o o o o o o
The British judge in the case here imposed the death penalty upon the person who survived. The judge
o o o o o o o o o o o o o o o o o
found it difficult to rule that every man on board had the right to make law by his own hand. The Crown
o o o o o o o o o o o o o o o o o o o o o o
reduced the sentence to six months.
o o o o o o
2. Smoking is a serious health hazard. Cigarettes are legal. Should cigarette manufacturers be liable for the serious
o o o o o o o o o o o o o o o o
illnesses and untimely deaths caused by their unavoidably dangerous products, eventhough they post a warning
o o o o o o o o o o o o o o o o
on the package and consumers voluntarily assume the health risks by smoking? [Cipollone v. Liggett Group,
o o o o o o o o o o o o o o o o
Inc., 505 U.S. 504 (1992)]
o o o o o
Answer: The general rule that exists now is that since the government has ordered the posting of warninglabels on
o o o o o o o o o o o o o o o o o o o
cigarettes, and since the dangers of smoking are well known, consumers have been warned and are not due
o o o o o o o o o o o o o o o o o o
compensation if they kill themselves by smoking. The Cippoline case, since reviewed by the Supreme Court,
o o o o o o o o o o o o o o o o
appears to be of limited impact since the victim was adjudged to have become addicted to cigarettes before
o o o o o o o o o o o o o o o o o o
the warning label was ordered in 1964. If cigarette makers were held responsible for all health problems
o o o o o o o o o o o o o o o o o
associated with cigarettes, then, like alcohol and other dangerous products, the damages would likely be so
o o o o o o o o o o o o o o o o
high it would effectively ban the products. Presumably, in a free society if adults are clearly informed of the
o o o o o o o o o o o o o o o o o o o
risks of products that cannot be made safe, they accept the risk. Tobacco and alcohol producers cannot take
o o o o o o o o o o o o o o o o o o
the dangers out of the products except at the margin by encouraging responsible drinking and the like. Are
o o o o o o o o o o o o o o o o o o
drugs like cocaine different?
o o o o
3. Two eight-year-old boys were seriously injured when riding Honda mini-trail bikes. The boys were riding on
o o o o o o o o o o o o o o o
public streets, ran a stop sign, and were hit by a truck. The bikes had clear warning labels on the front stating
o o o o o o o o o o o o o o o o o o o o o o
they were only for off-road use. The manual stated the bikes were not to be usedon public streets. The parents
o o o o o o o o o o o o o o o o o o o o o
sued Honda. The supreme court of Washington said one basic issue existed: “Is a manufacturer liable when
o o o o o o o o o o o o o o o o o
children are injured while riding one of its mini-trail bikes on apublic road in violation of manufacturer and
o o o o o o o o o o o o o o o o o o o
parental warnings?” Is it unethical to make products like mini-trail bikes children will use when we know
o o o o o o o o o o o o o o o o o
accidents like this will happen? [Baughn v. Honda Motor Co., 727 P.2d 655 Sup. Ct, Wash., (1986)]
o o o o o o o o o o o o o o o o o
Answer: The court found no liability for the manufacturers. There was no defect; the product was safe for intended
o o o o o o o o o o o o o o o o o o
use. Safety instructions were clear; the parents let the boys ride the bikes. Anything can bedangerous--
o o o o o o o o o o o o o o o o o
baseballs are dangerous when they hit the head, swings are dangerous when kids jumpout of them; there is
o o o o o o o o o o o o o o o o o o
only so much that can be done to make the government the ―national nanny‖ asthe Washington Post once
o o o o o o o o o o o o o o o o o o o
said about excessive consumer protection. Parents must accept a high degree of responsible for their own
o o o o o o o o o o o o o o o o
children.
o
4. Johnson Controls adopted a “fetal protection policy” that women of childbearing age could not work in the
o o o o o o o o o o o o o o o o
battery-making division of the company. Exposure to lead in the battery operation could causeharm to unborn
o o o o o o o o o o o o o o o o o
babies. The company was concerned about possible legal liability for injury sufferedby babies of mothers who
o o o o o o o o o o o o o o o o o
had worked in the battery division. The Supreme Court held the companypolicy was illegal. It was an “excuse for
o o o o o o o o o o o o o o o o o o o o
denying women equal employment opportunities.” Is the Court forcing the company to be unethical by allowing
o o o o o o o o o o o o o o o o
pregnant women who ignore the warnings to expose their babies to the lead? [United Auto Workers v. Johnson
o o o o o o o o o o o o o o o o o o
Controls, 499 U.S. 187 (1991)]
o o o o o
Answer: The Court held it a form of sex discrimination to prevent women of child-bearing age from holding the
o o o o o o o o o o o o o o o o o o
more dangerous jobs. The company argued that it did this to protect itself from possibleliability in case of
o o o o o o o o o o o o o o o o o o o
damage to babies and that the decision was ethical. The replacements for these workers were often men or
o o o o o o o o o o o o o o o o o o
more senior women, who tended to be higher income workers, so this
o o o o o o o o o o o o
