Solution and Answer Guide: Miller, Business Law Today – Standard Edition: Text & Summarized Cases 13e, 9780357634943;
Chapter 01: Law and Legal Reasoning
© 2022 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible 1
website, in whole or in part.
Solution and Answer Guide
Miller, Business Law Today – Standard Edition: Text & Summarized Cases 13e, 9780357634943;
Chapter 01: Law and Legal Reasoning
Table of Contents
Critical Thinking Questions in Features ……………………………………………………………………………………………………1
Managerial Strategy—Business Questions…………………………………………………………………………………… 1
Chapter Review…………………………………………………………………………………………………………………………………………….2
Practice and Review ………………………………………………………………………………………………………………….2
Practice and Review: Debate This ……………………………………………………………………………………………….2
Issue Spotters…………………………………………………………………………………………………………………………..3
Business Scenarios and Case Problems………………………………………………………………………………………..3
Critical Thinking and Writing Assignments…………………………………………………………………………………… 7
Appendix Exhibit……………………………………………………………………………………………………………………….8
Critical Thinking Questions in Features
Managerial Strategy—Business Questions
- ―When faced with a clearly erroneous precedent, my rule is simple,‖ writes Supreme Court Justice
Clarence Thomas. ―We should not follow it.‖ How do these words offer a cautionary tale for
managers relying on stare decisis to make business decisions?
Solution
Simply put, the doctrine of stare decisis applies in all instances, except when it does not. As noted
in the text, a court is able to depart from precedent if it feels that legal, social, or technological
changes have rendered the previous decision untenable. In this case, just because the United
State Supreme Court believes, at present, that automobile salespeople are exempt from the
overtime rules of the FLSA, there is a possibility that the Court could reverse itself in the future. In
this context, managers need to be aware that (1) any decision they make based on a court
decision is subject to change, and (2) if they believe that a previous business law-related court
decision is flawed, they can challenge it in court. - Should Roberta consider paying her salespeople overtime even though it is not required by
federal law? Why or why not?
Solution
Just because Roberta is legally able to avoid paying the salespeople at her new used car
dealership overtime, should she? As with so many managerial decisions, the answer to this
question involves the tricky determination of costs and benefits. On the one hand, Roberta‘s costs
will be lower if she does not have to pay overtime to the salespeople. On the other hand, the
salespeople may be more motivated if they feel they are being properly compensated for the
Solution and Answer Guide: Miller, Business Law Today – Standard Edition: Text & Summarized Cases 13e, 9780357634943;
Chapter 01: Law and Legal Reasoning
© 2022 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible 2
website, in whole or in part.
extra hours they spend on the lot. The extra motivation will likely lead to additional sales, which
very well may offset the overtime costs.
Chapter Review
Practice and Review
Suppose that the California legislature passes a law that severely restricts carbon dioxide emissions of
automobiles in that state. A group of automobile manufacturers files a suit against the state of
California to prevent enforcement of the law. The automakers claim that a federal law already sets fuel
economy standards nationwide and that these standards are essentially the same as carbon dioxide
emission standards. According to the automobile manufacturers, it is unfair to allow California to
impose more stringent regulations than those set by the federal law. Using the information presented
in the chapter, answer the following questions.
- Who are the parties (the plaintiffs and the defendant) in this lawsuit?
Solution
In this situation, the automobile manufacturers are the plaintiffs, and the state of California is the
defendant. - Are the plaintiffs seeking a legal remedy or an equitable remedy? Why?
Solution
The plaintiffs are seeking an injunction, which is an equitable remedy, to prevent the state of
California from enforcing its statute restricting carbon dioxide emissions. - What is the primary source of the law that is at issue here?
Solution
This case involves a law passed by the California legislature and a federal statute, thus the primary
source of law is statutory law. - Read through the appendix that follows this chapter, and then answer the following question:
Where would you look to find the relevant California and federal laws?
Solution
Federal statutes are found in the United States Code, and California statutes are published in the
California Code. You would look in both of these sources to find the relevant state and federal
statutes.
Practice and Review: Debate This - Under the doctrine of stare decisis, courts are obligated to follow the precedents established in
their jurisdictions unless there is a compelling reason not to. Should U.S. courts continue to
adhere to this common law principle, given that our government now regulates so many areas by
statute?
Solution
Both England and the U.S. legal systems were constructed on the common law system. The
doctrine of stare decisis has always been a major part of this system—courts should follow
precedents when they are clearly established, excepted when compelling reasons dictate
Solution and Answer Guide: Miller, Business Law Today – Standard Edition: Text & Summarized Cases 13e, 9780357634943;
Chapter 01: Law and Legal Reasoning
© 2022 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible 3
website, in whole or in part.
otherwise. Even though more common law is being turned into statutory law, the doctrine of stare
decisis is still valid. After all, statutes often must to be interpreted by courts. What better basis for
judges to render their decisions than by basing them on precedents related to the subject at
hand?
In contrast, some students may argue that the doctrine of stare decisis is passé. There is certainly
less common law governing, say, environmental law than there was 100 years ago. Given that
federal and state governments increasingly are regulating more aspects of commercial
transactions between merchants and consumers, perhaps the courts should simply stick to
statutory language when disputes arise.
Issue Spotters
- The First Amendment to the U.S. Constitution provides protection for the free exercise of religion.
A state legislature enacts a law that outlaws all religions that do not derive from the JudeoChristian tradition. Is this law valid within that state? Why or why not?
Solution
No. The U.S. Constitution is the supreme law of the land, and applies to all jurisdictions. A law in
violation of the Constitution (in this question, the First Amendment to the Constitution) will be
declared unconstitutional. - Apex Corporation learns that a federal administrative agency is considering a rule that will have a
negative impact on the firm‘s ability to do business. Does the firm have any opportunity to
express its opinion about the pending rule? Explain.
Solution
Yes. Administrative rulemaking starts with the publication of a notice of the rulemaking in the
Federal Register. Among other details, this notice states where and when the proceedings, such as
a public hearing, will be held. Proponents and opponents can offer their comments and concerns
regarding the pending rule. After reviewing all the comments from the proceedings, the agency‘s
decision makers consider what was presented and draft the final rule.
Business Scenarios and Case Problems - Binding versus Persuasive Authority. A county court in Illinois is deciding a case involving an
issue that has never been addressed before in that state‘s courts. The Iowa Supreme Court,
however, recently decided a case involving a very similar fact pattern. Is the Illinois court obligated
to follow the Iowa Supreme Court‘s decision on the issue? If the United States Supreme Court had
decided a similar case, would that decision be binding on the Illinois court? Explain. (See The
Common Law.)
Solution
A decision of a court is binding on all inferior courts. Because no state‘s court is inferior to any
other state‘s court, no state‘s court is obligated to follow the decision of another state‘s court on
an issue. The decision may be persuasive, however, depending on the nature of the case and the
particular judge hearing it. A decision of the United States Supreme Court on an issue is binding,
like the decision of any higher court, on all inferior courts. The United States Supreme Court is
the nation‘s highest court, however, and thus, its decisions are binding on all courts, including
state courts.
Solution and Answer Guide: Miller, Business Law Today – Standard Edition: Text & Summarized Cases 13e, 9780357634943;
Chapter 01: Law and Legal Reasoning
© 2022 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible 4
website, in whole or in part.
- Sources of Law. This chapter discussed a number of sources of American law. Which source of
law takes priority in the following situations, and why? (See Sources of American Law.) - A federal statute conflicts with the U.S. Constitution.
Solution - The U.S. Constitution—The U.S. Constitution is the supreme law of the land. A law in violation
of the Constitution, no matter what its source, will be declared unconstitutional and will not
be enforced. - A federal statute conflicts with a state constitutional provision.
Solution - The federal statute—Under the U.S. Constitution, when there is a conflict between a federal
law and a state law, the state law is rendered invalid. - A state statute conflicts with the common law of that state.
Solution - The state statute—State statutes are enacted by state legislatures. Areas not covered by state
statutory law are governed by state case law. - A state constitutional amendment conflicts with the U.S. Constitution.
Solution - The U.S. Constitution—State constitutions are supreme within their respective borders unless
they conflict with the U.S. Constitution, which is the supreme law of the land. - Remedies. Arthur Rabe is suing Xavier Sanchez for breaching a contract in which Sanchez
promised to sell Rabe a Van Gogh painting for $150,000. (See The Common Law.) - In this lawsuit, who is the plaintiff, and who is the defendant?
Solution - In a suit by Arthur Rabe against Xavier Sanchez, Rabe is the plaintiff and Sanchez is the
defendant. - If Rabe wants Sanchez to perform the contract as promised, what remedy should Rabe seek?
Solution - Specific performance is the remedy that includes an order to a party to perform a contract as
promised.