CHAPTER 1: THE LEGAL ENVIRONMENT OF BUSINESS

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Enforceable rules governing relationships among individuals and between individuals and their society:
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LAW
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A document that establishes the law on a particular issue:
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PRIMARY SOURCE OF LAW
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What are the four primary sources of law in the US:
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(1) A constitution (2) A statue – laws passed by congress and by state legislatures (3) An administrative rule – regulations created by administrative agencies (4) A court decision – case law
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A publication that summarizes or interprets the law:
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SECONDARY SOURCE OF LAW
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What are three secondary sources of law in the US:
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(1) A legal encyclopedia (2) A legal treatise (3) An article in a law review
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The body of law derived from the US Constitution and the constitutions of the various states:
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CONSTITUTIONAL LAW
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The body of law enacted by legislative bodies: * as opposed to constitutional law, administrative law, or case law
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STATUTORY LAW
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A regulation enacted by a city or county legislative body that becomes part of that state’s statutory law:
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ORIDNANCE
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A model law developed in 1892 by the National Conference of Commissioners on Uniform State Laws (NCCUSL) for the states to consider enacting into statue:
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UNIFORM LAW
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Facilitates commerce among the states by providing a uniform, yet flexible, set of rules governing commercial transactions:
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THE UNIFORM COMMERCIAL CODE (UCC)
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This was created through the joint efforts of the NCCUSL and the American Law Institute and first issued in 1952:
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UCC
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The body of law created by administrative agencies in order to carry out their duties and responsibilities:
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ADMINISTRATIVE LAW
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A federal or state government agency created by the legislature to perform a specific function, such as to make and enforce rules pertaining to the environment:
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ADMINISTRATIVE AGENCY
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What are the two types of agencies at the federal level:
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(1) executive agencies (2) independent regulatory agencies
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______ agencies are subject to the authority of the president, who has the power to appoint and remove their officers:
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Executive
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______ agencies officers serve for fixed terms and cannot be removed without just cause:
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INDEPENDENT
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A statute enacted by Congress that authorizes the creation of an administrative agency and specifies the name, composition, purpose, and powers of the agency being created:
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ENABLING LEGISLATION
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The __________ was created in 1914 by the Federal Trade Commission Act, which prohibits unfair and deceptive trade practices:
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FEDERAL TRADE COMMISSION (FTC)
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To render a judicial decision
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ADJUDICATE
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______ is the trial-like proceeding in which an administrative law judge hears and resolves disputes involving an administrative agency’s regulations:
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ADJUDICATION
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The procedure used by administrative agencies in administering the law:
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ADMINISTRATIVE PROCESS
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The process by which an administrative agency formally adopts a new regulation or amends an old one:
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RULEMAKING
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An administrative agency’s rule that carries the same weight as a congressionally enacted statute:
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LEGISLATIVE RULE
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What Act imposes strict procedural requirements that agencies must follow in legislative rulemaking and other functions:
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The Administrative Procedure Act of 1946
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The __________ of 1970 authorized the Occupational Safety and Health Administration (OSHA) to develop and issue rules governing safety in the workplace:
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OCCUPATIONAL SAFETY AND HEALTH ACT
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A nonbinding rule or policy statement issued by an administrative agency that explains how it interprets and intends to apply the statutes it enforces:
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INTERPRETIVE RULE
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One who presides over an administrative agency hearing and has the power to: administer oaths, take testimony, rule on questions of evidence, and make determinations of fact:
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ADMINISTRATIVE LAW JUDGE (ALJ)
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Do administrative agencies exercise too much authority:
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* Agency rulemaking must comply with the requirements of the Administrative Procedure Act (APA), the act applies only to legislative, not interpretive, rulemaking. * In addition, the APA is largely procedural and aimed at preventing arbitrariness. * Yet administrative agencies’ powers often go unchecked by the other branches of government, causing some to suggest that it’s unethical for agencies to wield so many powers. PAGE 10
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The rules of law announced in court decisions:
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CASE LAW
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______ interprets statutes, regulations, constitutional provisions, and other laws:
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CASE LAW
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The body of law developed from custom or judicial decisions in English and U.S. courts, not attributable to a legislator:
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COMMON LAW
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What is the Common Law Tradition:
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Much of American law is based on the English Legal System
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A court decision that furnishes an example or authority for deciding subsequent cases involving identical or similar facts:
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PRECEDENT
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When might a court depart from precedent:
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If a court decides that a precedent is simply incorrect or that technological or social changes have rendered the precedent inapplicable, the court may rule contrary to the precedent. PAGE 12
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A common law doctrine under which judges are obligated to follow the precedents established in prior decisions: * “to stand on decided cases”
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STARE DECISIS
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__________ include constitutions, statutes, and regulations that govern the issue being decided, as well as court decisions that are controlling precedents within a jurisdiction:
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BINDING AUTHORITY
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Any source of law that a court must follow when deciding a case:
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BINDING AUTHORITY
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Courts normally must follow the rules set forth by __________ in deciding cases with similar fact patterns:
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HIGHER COURTS
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Any legal authority or source of law that a court may look to for guidance but need not follow when making its decision: * AKA: “cases of first impression”
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PERSUASIVE AUTHORITY
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The relief given to an innocent party to enforce a right or compensate for the violation of a right:
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REMEDY
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Elena is injured because of Rowan’s wrongdoing. If Elena files a lawsuit and is successful, a court can order Rowan to compensate Elena for the harm by paying her a certain amount. The compensation is Elena’s ______:
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REMEDY
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One who initiates a lawsuit:
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PLAINTIFF
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One against whom a lawsuit is brought, or the accused person in a criminal proceeding:
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DEFENDANT
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What is the difference between Remedies at Law and Remedies in Equity:
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* Remedies at law are for monetary damages * Equitable relief comes in the form of actions (specific performance or an injunction)
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General propositions or principles of law that have to do with fairness (equity):
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EQUITABLE PRINCIPLES AND MAXIMS
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* Even though courts of law and equity have merged, the courts will not grant a(n) _________ unless the _______ is inadequate:
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Equitable Remedy Remedy at Law
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The science or philosophy of law:
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JURISPRUDENCE
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The oldest school of legal thought, based on the belief that the legal system should reflect universal (“higher”) moral and ethical principles that are inherent in human nature:
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NATURAL LAW
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A school of legal thought that views the law as a tool for promoting justice in society:
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SOCIOLOGICAL SCHOOL
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A school of legal thought centered on the assumption that there is no law higher than the laws created by a national government: * Laws must be obeyed, even if they are unjust, to prevent anarchy
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LEGAL POSITIVISM
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A school of legal thought that looks to the past to determine what the principles of contemporary law should be: * More likely to adhere stictley to decisions made in past cases
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HISTORICAL SCHOOL
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A school of legal thought that holds that the law is only one factor to be considered when deciding cases and that social and economic circumstances should also be taken into account: * Different judges will obviously bring different reasoning processes to the same case
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LEGAL REALISM
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Law that defines, describes, regulates, and creates legal rights and obligations:
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SUBSTANTIVE LAW
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Law that establishes the methods of enforcing the rights established by substantive law:
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PROCEDURAL LAW
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_________ establish the method where an employee must notify the employer of an on-the-job injury, prove the injury, and periodically submit proof to continue with workers’ comp. benefits:
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PROCEDURAL LAW
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________ provide employees with the right to workers’ comp. benefits for any on-the-job injuries they sustain:
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SUBSTANTIVE LAW
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An informal term used to refer to all laws governing electronic communications and transactions, particularly those conduced via the internet:
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CYBERLAW
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Dealing with relationship between persons:
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PRIVATE LAW
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A law addressing the relationship between persons and their governments:
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PUBLIC LAW
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The branch of law dealing with the definition and enforcement of all private or public rights, as opposed to criminal matters:
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CIVIL LAW
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A system of law derived from Roman law that is based on codified laws (rather than on case precedents):
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CIVIL LAW SYSTEM
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The branch of law that defines and punishes wrongful actions committed against the public:
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CRIMINAL LAW
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Penalties for violations of criminal statutes consist of:
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Fines and/or imprisonment and, in some cases, death
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What are some important differences between Civil Law and Criminal Law:
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* In a Civil Case the object is to obtain a remedy (like monetary damages) to compensate the injured party. Civil defendants are prosecuted by their victims or other private parties. * In a Criminal Case the object is to punish the wrongdoer in an attempt to deter others from similar actions. Criminal defendants are prosecuted on behalf of the state.
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Law that pertains to a particular nation (as opposed to international law): * Laws varies from country to country
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NATIONAL LAW
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The law that governs relations among nations: * A body of written and unwritten laws
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INTERNATIONAL LAW
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The key difference between National Law and International Law is that:
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Government authorities can enforce national law
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A court opinion that represents the views of the majority (more than half) of the judges or justices deciding the case:
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MAJORITY OPINION
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A court opinion that is joined by the largest number of the judges or justices hearing the case, but less than half of the total number:
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PLURALITY OPINION
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A court opinion by one or more judges or justices who agree with the majority but want to make or emphasize a point that was not made or emphasized in the majority’s opinion:
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CONCURRING OPINION
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A court opinion that presents the views of one or more judges or justices who disagree with the majority’s decision:
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DISSENTING OPINION
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A court opinion that does not indicate which judge or justice authorized the opinion:
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PER CURIAM OPINION

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