Human Resources Management (HRM)

Chapter One Critical Thinking and Legal Reasoning

1. The Importance of Critical Thinking

2. A Critical Thinking Model

3. The Critical Thinking Steps

4. Using Critical Thinking to Make Legal Reasoning come Alive

5. Applying the Critical Thinking Approach

(Kubasek 2)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.

The Importance of Critical Thinking

Success in business requires the development of critical thinking skills. Business leaders regularly list these skills as the first set of competencies needed in business. A simple Google search for “critical thinking in business” produces more than 80 million suggested URLs.

critical thinking skills

The ability to understand the structure of an argument and apply a set of evaluative criteria to assess its merits.

Critical thinking refers to the ability to understand what someone is saying and then to ask specific questions enabling you to evaluate the quality of the reasoning offered to support whatever advice someone has given you. Because firms are under increasing competitive pressure, business and industry need managers with advanced thinking skills.1 Highlighting this need, a report by the U.S. secretary of education states that because “one of the major goals of business education is preparing students for the workforce, students and their professors must respond to this need for enhancing critical thinking skills.”2

1 C. Sormunen and M. Chalupa, “Critical Thinking Skills Research: Developing Evaluation Techniques,” Journal of Education for Business 69: 172 (1994).

2 Id.

Calls for improvements in critical thinking skills also come from those concerned about business leadership. David A. Garvin of the Harvard Business School argues that there is a general feeling in the business community that business leaders need to sharpen their critical thinking skills.3 As a future business manager, you will experience many leadership dilemmas: All such questions require legal analysis and business leadership, guided by critical thinking.

3 John Baldon, “How Leaders Should Think Critically,” HBR Blog Network, January 20, 2010.

A business leader must listen to many sources of information and many advisors. They are not all going to give advice that leads in a single direction. Critical thinking skills enable you to weigh the relative worth of alternative courses of action. For example, there will always be reasons you should encourage the growth of your labor force, but there will also be reasons you should not. You do not want these options to paralyze you, nor do you want to latch onto one approach for insubstantial reasons and then pay the price later.

 

Courtesy Holly Barnes

The message is clear: Success in business today requires critical thinking skills, and there is no better context in which to develop them than in the study of business law. Critical thinking skills learned in the Legal Environment of Business course will be easily transferred to your eventual role as a manager, entrepreneur, or other business professional. The law develops through argument among various parties. Critical thinking facilitates the development of more effective law.

Legal reasoning is like other reasoning in some ways and different in others. When people, including lawyers and judges, reason, they do so for a purpose. Some problem or dilemma bothers them. The stimulus that gets them thinking is the issue. It is stated as a question because it is a call for action. It requires them to do something, to think about answers.

For instance, in our Legal Environment of Business course, we are interested in such issues as:

1. Under the National Labor Relations Act, when are union organizers permitted to enter an employer’s property?

2. When do petroleum firms have liability for the environmental and economic effects of oil spills?

3. Must a business fulfill a contract when the contract is made with an unlicensed contractor in a state requiring that all contractors be licensed?

Such questions have several possible answers. Which one should you choose? Critical thinking and ethical reasoning moves us toward better choices, more thoughtful decisions reflecting knowledge of specific skills for weighing and selecting productive approaches. Issues or business dilemmas require answers. Business leaders often do not have the luxury of waiting around until perfect information floats by. They have to respond effectively or risk business failure. Some answers could get you into trouble; others could advance your purpose. Each answer is called a conclusion. A conclusion is a position or stance on an issue, the takeaway that the person giving you advice wants you to believe.

conclusion

A position or stance on an issue; the goal toward which reasoning pushes us.

Business firms encounter legal conclusions in the form of laws or court decisions and in the advice they receive from people with formal legal training. As businesses learn about and react to decisions or conclusions made by courts, they have two primary methods of response:

1. Memorize the conclusions or rules of law as a guide for future business decisions.

2. Make judgments about the quality of the conclusions. When legal rules fail to reflect understanding of the practicalities of doing business, business leaders play an important civic role in trying to modify those laws.

This book encourages you to do both. What is unique about this text is its practical approach to evaluating legal reasoning. This approach is based on using critical thinking skills to understand and evaluate the law as it affects business.

There are many forms of critical thinking, but they all share one characteristic: They focus on the quality of someone’s reasoning. Critical thinking is active; it challenges each of us to form judgments about the quality of the link between someone’s reasons and conclusions. In particular, we will be focusing on the link between a court’s reasons and its conclusions.

(Kubasek 2-4)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.

 

 

A Critical Thinking Model

You will learn critical thinking by practicing it. This text will tutor you, but your efforts are the key to your skill as a critical thinker. Because people often learn best by example, we will introduce you to critical thinking by demonstrating it in a model that you can easily follow.

8. Is there relevant missing information?

7. How appropriate are the legal analogies?

6. What ethical norms are fundamental to the court’s reasoning?

5. Does the legal argument contain significant ambiguity?

4. What are the relevant rules of law?

3. What are the reasons and conclusion?

2. What is the issue?

1. What are the facts?

Exhibit 1-1 The Eight Steps to Legal Reasoning

We now turn to a sample of critical thinking in practice. The eight critical thinking questions listed in Exhibit 1-1 and applied in the sample case that follows illustrate the approach you should use when reading cases to develop your critical thinking abilities.

As a citizen, entrepreneur, or manager, you will encounter cases like the one that follows. How would you respond? What do you think about the quality of Judge Cedarbaum’s reasoning?

Case 1-1 United States of America v. Martha Stewart and Peter Bacanovic

United States District Court for the Southern District of New York, 2004 U.S. Dist. LEXIS 12538

Defendants Martha Stewart and Peter Bacanovic were both convicted of conspiracy, making false statements, and obstruction of an agency proceeding, following Stewart’s sale of 3,928 shares of ImClone stock on December 27, 2001. Stewart sold all of her ImClone stock after Bacanovic, Stewart’s stockbroker at Merrill Lynch, informed Stewart that the CEO of ImClone, Samuel Waksal, was trying to sell his company stock. On December 28, 2001, ImClone announced that the Food and Drug Administration (FDA) had not approved the company’s cancer-fighting drug Erbitux. Thereafter, the Securities and Exchange Commission (SEC) and the United States Attorney’s Office for the Southern District of New York began investigations into the trading of ImClone stock, including investigations of Stewart and Bacanovic.

Following Stewart’s and Bacanovic’s criminal convictions, the defendants filed a motion for a new trial, alleging that expert witness Lawrence F. Stewart, director of the Forensic Services Division of the United States Secret Service, had committed perjury in his testimony on behalf of the prosecution. As the “national expert for ink analysis,” Lawrence Stewart testified about the reliability of defendant Bacanovic’s personal documents that contained information about Martha Stewart’s investments in ImClone.

Judge Cedarbaum

Rule 33 provides: “Upon the defendant’s motion, the court may vacate any judgment and grant a new trial if the interest of justice so requires.”* However, “in the interest of according finality to a jury’s verdict, a motion for a new trial based on previously-undiscovered evidence is ordinarily ‘not favored and should be granted only with great caution.’” In most situations, therefore, “relief is justified under Rule 33 only if the newly-discovered evidence could not have been discovered, exercising due diligence, before or during trial, and that evidence ‘is so material and non-cumulative that its admission would probably lead to an acquittal.’”

But the mere fact that a witness committed perjury is insufficient, standing alone, to warrant relief under Rule 33. “Whether the introduction of perjured testimony requires a new trial initially depends on the extent to which the prosecution was aware of the alleged perjury. To prevent prosecutorial misconduct, a conviction obtained when the prosecution’s case includes testimony that was known or should have been known to be perjured must be reversed if there is any reasonable likelihood that the perjured testimony influenced the jury.” When the Government is unaware of the perjury at the time of trial, “a new trial is warranted only if the testimony was material and ‘the court [is left] with a firm belief that but for the perjured testimony, the defendant would most likely not have been convicted.’”

Defendants have failed to demonstrate that the prosecution knew or should have known of Lawrence’s perjury. However, even under the stricter prejudice standard applicable when the Government is aware of a witness’s perjury, defendants’ motions fail. There is no reasonable likelihood that knowledge by the jury that Lawrence lied about his participation in the ink tests and whether he was aware of a book proposal could have affected the verdict.

The verdict, the nature of Lawrence’s perjury, and the corroboration that Lawrence’s substantive testimony received from the defense’s expert demonstrate that Lawrence’s misrepresentations could have had no effect on defendants’ convictions.

First, the jury found that the Government did not satisfy its burden of proof on the charges to which Lawrence’s testimony was relevant. Defendants do not dispute that Bacanovic was acquitted of the charge of making and using a false document, and that none of the false statement and perjury specifications concerning the existence of the $60 agreement were found by the jury to have been proved beyond a reasonable doubt. . . . In other words, the jury convicted defendants of lies that had nothing to do with the $60 agreement. The outcome would have been no different had Lawrence’s entire testimony been rejected by the jury, or had Lawrence not testified at all.

Defendants argue that acquittal on some charges does not establish that the jury completely disregarded Lawrence’s testimony. They contend that the $60 agreement constituted Stewart and Bacanovic’s core defense and that the “@60” notation was evidence which supported that defense.

This argument is wholly speculative and logically flawed. The existence of the $60 agreement would not have exonerated defendants. It would not have been inconsistent for the jury to find that defendants did make the $60 agreement, but that the agreement was not the reason for the sale. In addition to the substantial basis for concluding that the jury’s decision could not have been affected by the revelation of Lawrence’s misrepresentations, ample evidence unrelated to the $60 agreement or to Lawrence’s testimony supports defendants’ convictions.

The testimony of Faneuil, Perret, and Pasternak supports the jury’s determinations that Stewart lied when she told investigators that she did not recall being informed of Waksal’s trading on December 27. . . .

Finally, Faneuil’s testimony supports the jury’s determination that Stewart lied when she claimed not to have spoken with Bacanovic about the Government investigation into ImClone trading or Stewart’s ImClone trade (Specifications Six and Seven of Count Three). Faneuil stated that Bacanovic repeatedly told him in January 2002 and afterward that Bacanovic had spoken to Stewart and that everyone was “on the same page.”

Motion for a new trial denied.

Before we apply critical thinking to this case, notice that the law is a place where people actively disagree. They are fighting over responsibilities, rights, and fairness. Business law provides a scenario in which parties can peacefully settle the disputes they will inevitably have. Law is and always has been an alternative to war and physical fights. It is a human invention that should make us proud that we can do better than use physical force to settle disagreements.

Now let’s get to work, learning how to use the law optimally in business.

First, review the eight steps of a critical thinking approach to legal reasoning in Exhibit 1-1. Throughout the book, we will call these the critical thinking questions. They are questions we are asking of those who have particular legal conclusions. Notice the primary importance of the first four steps; their purpose is to discover the vital elements in the case and the reasoning behind the decision. Failure to consider these four foundational steps might result in our reacting too quickly to what a court or legislature has said. The rule here is: We should never evaluate until we first understand the argument being made.

The answers to these four questions enable us to understand how the court’s argument fits together and to make intelligent use of legal decisions. These answers are the necessary first stage of a critical thinking approach to legal analysis. The final four questions are the critical thinking component of legal reasoning. They are questions that permit us to evaluate the reasoning and to form our reaction to what the court decided.

You will develop your own workable strategies for legal reasoning, but we urge you to start by following our structure. Every time you read a case, ask yourself these eight questions. The remainder of this section will demonstrate the use of each of the eight steps. Notice that the order makes sense. The first four follow the path that best allows you to discover the basis of a particular legal decision; the next four assist you in deciding what you think about the worth of that decision.

(Kubasek 4-7)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.

 

 

 

The Critical Thinking Steps

Facts

First we look for the most basic building blocks in a legal decision or argument. These facts provide the context in which the legal issue is to be resolved. Alter those facts, and the legal conclusion might be very different. Certain events occurred; certain actions were or were not taken; particular persons behaved or failed to behave in specific ways. We always wonder, what happened in this case? Let’s now turn our attention to the Stewart case:

1. Martha Stewart sold 3,928 shares of her ImClone stock on December 27, 2001.

2. On December 28, 2001, ImClone announced the FDA’s rejection of its new cancer-fighting drug, which caused the company’s stock to lose value.

3. Stewart and Bacanovic were convicted of conspiracy, making false statements, and obstruction of an agency proceeding.

4. Expert witness Lawrence Stewart was accused of perjuring himself in the testimony he gave prior to the defendants’ conviction.

5. According to a federal rule and case law, perjury of a witness could constitute grounds for a new trial.

Issue

In almost any legal conflict, finding and expressing the issue is an important step in forming a reaction. So important is the definition of the issue, that many times the lawyers in a legal suit spend considerable effort trying to get the judge or jury to see the issue a particular way so that they have a better chance of winning the case. The issue is the question that caused the lawyers and their clients to enter the legal system. Usually, there are several reasonable perspectives concerning the correct way to word the issue in dispute.

1. In what instances may a court grant a new trial?

2. Does perjury of a witness mean that defendants should have a new trial?

3. Do the regulations in Rule 33 and relevant case law permit the defendants to have a new trial?

Do not let the possibility of multiple useful ways to word the issue cause you any confusion. The issue is certainly not just anything that we say it is. If we claim something is an issue, our suggestion must fulfill the definition of an issue in this particular factual situation.

Reasons and Conclusion

Judge Cedarbaum held that the defendants should not have a new trial. This finding by Judge Cedarbaum is her conclusion; it serves as her answer to the legal issue. Why did she answer this way? Here we are calling for the reasons, explanations or justifications provided as support for a conclusion.

reason

An explanation or justification provided as support for a conclusion.

1. Under Rule 33 and relevant case law, perjury is not sufficient to justify a new trial, unless (a) the government knew about the perjury or (b) the perjured testimony was so material that without it the verdict would probably have resulted in acquittal of the defendants.

2. The defendants did not demonstrate that the government knew or should have known about the perjured testimony.

3. The jury would still have convicted the defendants apart from Lawrence’s testimony.

4. Defense experts agreed with Lawrence on the “most critical aspects of his scientific analysis.”

Let’s not pass too quickly over this very important critical thinking step. When we ask why of any opinion, we are showing our respect for reasons as the proper basis for any assertion. The judge did not rely on astrology or palm readers to guide her. Instead, she relied on our special ability to identify and sort through reasons and evidence.

We want a world rich with opinions so we can have a broad field of choice. We should, however, agree with only those legal opinions that have convincing reasons supporting the conclusion. Thus, asking why is our way of saying, “I want to believe you, but you have an obligation to help me by sharing the reasons for your conclusion.”

Rules of Law

Judges cannot offer just any reasoning they please. They must always look back over their shoulders at the laws and previous court decisions that together provide a foundation for current and future decisions. They must follow precedents, the decisions in past cases with similar facts.

This particular case is an attempt to match the words of the Federal Rules of Criminal Procedure, specifically Rule 33, and its regulations with the facts in this particular case. The court also references case law. What makes legal reasoning so complex is that statutes and findings are never crystal clear. Judges and businesspeople have room for interpretive flexibility in their reasoning.

Ambiguity

The starting point for thinking about this important critical thinking standard is recognizing that a word does not have just one meaning. Thus, when I say a particular word to you, there is no reason I should presume that the meaning I had in mind is transferred into your mind in exactly the same form as it left my mouth. As soon as we realize the flexibility of words, a huge responsibility falls onto our shoulders. We have to seek clarity in what people say to us, or we risk reacting to what they said in a manner they never intended to encourage. Exploring the meaning of what people say is only fair to them.

The court’s reasoning must rest on its implied assumptions about the meaning of several ambiguous words or phrases. (An ambiguous word is one capable of having more than one meaning in the context of these facts.) For instance, Judge Cedarbaum stated that Rule 33 permits the court to grant a new trial if the “interest of justice so requires.” But what is the “interest of justice”?

ambiguous

Possessing two or more possible interpretations.

Does the interest of justice entail strict conformity to legal precedents? Or could the court’s reliance on certain precedents result in some form of injustice in the Stewart case? If we adopt the former definition, we would be more inclined to conclude that the judge’s denying the defendants’ motion for a new trial was consistent with the “interest of justice.” However, if the legislators who created Rule 33 intended a definition of “justice” that placed a stronger emphasis on judicial fairness, for example, perhaps we would be less supportive of Judge Cedarbaum’s decision.

Another illustration of important ambiguity in the decision is the court’s use of the term reasonable likelihood, referring to the probability that Lawrence’s alleged perjury could not have affected the jury’s verdict—but what degree of probability is a “reasonable likelihood”? Does this level of probability suggest that knowledge of Lawrence’s testimony could have affected the jury’s verdict? If we interpret “reasonable likelihood” as still including the possibility that knowledge of Lawrence’s perjury could have affected the jury, we might reach a conclusion that differs from the court’s decision. If we assume a definition of “reasonable likelihood” similar to “beyond a reasonable doubt,” however, we would be more inclined to agree with the judge’s decision. Hence, until we know what “reasonable likelihood” means, we cannot fairly decide whether the judge made the appropriate decision.

Ethical Norms

The primary ethical norms that influence judges’ decisions are justice, stability, freedom, and efficiency. Notice that each of these words is an abstraction, something we cannot touch, smell, hear, or see. As important as these ethical norms are, they are simply an invitation to a conversation—a conversation focusing on the meaning being used in this particular instance. Judge Cedarbaum expresses herself as a defender of stability or order. (Here is a good place to turn to Exhibit 1-2 to check alternative definitions of stability.) She is unwilling to grant a new

A judge’s allegiance to a particular ethical norm focuses our attention on a specific category of desired conduct. We have, or think we have, an understanding of what is meant by freedom and other ethical norms.

But do we? Ethical norms are, without exception, complex and subject to multiple interpretations. Consequently, to identify the importance of one of the ethical norms in a piece of legal reasoning, we must look at the context to figure out which form of the ethical norm is being used. The types of conduct called for by the term freedom not only differ depending on the form of freedom being assumed, but at times they can contradict each other.

As a future business manager, your task is to be aware that there are alternative forms of each ethical norm. Then a natural next step is to search for the form used by the legal reasoning so you can understand and later evaluate that reasoning.

The following alternative forms of the four primary ethical norms can aid you in that search.

Ethical Norms	Forms
1.	Freedom To act without restriction from rules imposed by others
	To possess the capacity or resources to act as one wishes
2.	Security To provide the order in business relationships that permits predictable plans to be effective
	To be safe from those wishing to interfere with your property rights
	To achieve the psychological condition of self-confidence such that risks are welcomed
3.	Justice To receive the product of your labor
	To provide resources in proportion to need
	To treat all humans identically, regardless of class, race, gender, age, and so on
	To possess anything that someone else was willing to grant you
4.	Efficiency To maximize the amount of wealth in our society
	To get the most from a particular input
	To minimize costs

Exhibit 1-2 Clarifying the Primary Ethical Norms

trial simply on the fact that one of the witnesses allegedly committed perjury. Instead of granting the defendants’ motion, Judge Cedarbaum elevates the “interest of according finality to a jury’s verdict,” even if the prosecution knew or should have known about the alleged perjury. Citing previous case law, she is able to grant new trials only in rare instances.

Analogies

Ordinarily, our examination of legal analogies will require us to compare legal precedents cited by the parties with the facts of the case we are examining. Those precedents are the analogies on which legal decision making depends. In this case, Judge Cedarbaum relies on several legal precedents as analogies for her ruling.

In United States v. Wallach, the Second Circuit held that even if the prosecution knew of a witness’s perjury, the court should not grant a new trial when other “independent” evidence is sufficient to convict a defendant. The worth of this analogy depends on a greater understanding of independent evidence. In other words, what constitutes independent evidence? And is the strength of independent evidence in the Stewart case comparable to the independent evidence in Wallach? Or are there significant differences between the two cases such that the court’s reliance on Wallach is unwarranted in this case?

To feel comfortable with the analogy, we would need to be persuaded that the independent evidence in the Stewart case is basically similar to the independent evidence in the precedent, United States v. Wallach. Law is an interpretive practice. Each of us brings a different set of experiences, aspirations, and perspectives to our interpretations. We move forward in the midst of our differences by assembling reasonable arguments for why our understanding of the analogy makes sense.

Missing Information

When any of us makes a decision, we always do so with less information than we would love to have. In the search for relevant missing information, it is important not to say just anything that comes to mind. For example, where did the defendants eat Thanksgiving dinner? Anyone hearing that question would understandably wonder why it was asked. Ask only questions that would be helpful in understanding the reasoning in this particular case.

To focus on only relevant missing information, we should include an explanation of why we want it with any request for additional information. We have listed a few examples here for the Stewart case. You can probably identify others.

1. How well informed is Judge Cedarbaum with respect to the deliberations of the jury? If her understanding of the jurors’ preverdict discussions is very limited, the defendants’ request for a new trial might be more convincing, because Judge Cedarbaum repeatedly contends that jurors’ knowledge of Lawrence’s alleged perjury would not have affected the jurors’ decision.

2. Congress, as it does with any legislation, discussed the Rules of Criminal Procedure before passing them. Does that discussion contain any clues as to congressional intent with respect to the various conditions required for a defendant to receive a new trial? The answer would conceivably clarify the manner in which the court should apply Rule 33.

3. Are there examples of cases in which courts have examined fact patterns similar to those in the Stewart case but reached different conclusions about a new trial? The answer to this question would provide greater clarity about the appropriateness of using certain case precedents, thereby corroborating or undermining Judge Cedarbaum’s decision.

Many other critical thinking skills could be applied to this and other cases. In this book, we focus on the ones especially valuable for legal reasoning. Consistently applying this critical thinking approach will enable you to understand the reasoning in legal cases and increase your awareness of alternative approaches our laws could take to many legal environment of business problems. The remaining portion of this chapter examines each of the critical thinking questions in greater depth to help you better understand the function of each.

(Kubasek 7-11)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.

 

 

 

Using Critical Thinking to Make Legal Reasoning Come Alive

Our response to an issue is a conclusion. It is what we want others to believe about the issue. For example, a court might conclude that an employee, allegedly fired for her political views, was actually a victim of employment discrimination and is entitled to a damage award. Conclusions are reached by following a path produced by reasoning. Hence, examining reasoning is especially important when we are trying to understand and evaluate a conclusion.

There are many paths by which we may reach conclusions. For instance, I might settle all issues in my life by listening to voices in the night, asking my uncle, studying astrological signs, or just playing hunches. Each method could produce conclusions. Each could yield results.

But our intellectual and legal tradition demands a different type of support for conclusions. In this tradition, the basis for our conclusions is supposed to consist of reasons. When someone has no apparent reasons, or the reasons don’t match the conclusion, we feel entitled to say, “But that makes no sense.” We aren’t impressed by claims that we should accept someone’s conclusion “just because.”

This requirement that we all provide reasons for our conclusions is what we mean, in large part, when we say we are going to think. We will ponder what the reasons and conclusion are and whether they fit together logically. This intense study of how a certain conclusion follows from a particular set of reasons occupies much of the time needed for careful decision making.

Persons trained to reason about court cases have uncommon appreciation for the unique facts that provoked a legal action. Those facts, and no others, provide the context for our reasoning. If an issue arises because environmentalists want to prevent an interstate highway from extending through a wilderness area, we want to know right away: What are the facts? Tell us more about this wilderness area. What procedures were followed before approving the route for this highway? What evidence was presented to project the possible harm to the ecological system?

Legal reasoning encourages unusual and necessary respect for the particular factual situation that stimulated disagreement between parties. These fact patterns, as we call them, bring the issue to our attention and limit the extent to which the court’s conclusion can be applied to other situations. Small wonder that the first step in legal reasoning is to ask and answer the question: What are the facts?

Legal Reasoning

1. Step 1: What Are the Facts? The call for the facts is not a request for all facts, but only those that have a bearing on the dispute at hand. The precise nature of the dispute tells us whether a certain fact is pertinent. In some cases, the plaintiff’s age may be a key point; in another, it may be irrelevant.

Only after we have familiarized ourselves with the relevant legal facts do we begin the familiar pattern of reasoning that thoughtful people use. We then ask and answer the following question: What is the issue?

2. Step 2: What Is the Issue? The issue is the question that the court is being asked to answer. For example, courts face groups of facts relevant to issues such as the following:

1. Does Title VII apply to sexual harassment situations when the accused and the alleged victim are members of the same sex?

2. Does a particular merger between two companies violate the Sherman Act?

3. When does a governmental regulation require compensation to the property owner affected by the regulation?

As we pointed out earlier, the way we express the issue guides the legal reasoning in the case. Hence, forming an issue in a very broad or an extremely narrow manner has implications for the scope of the effect stemming from the eventual decision. You can appreciate now why parties to a dispute work very hard to get the court to see the issue in a particular way.

You will read many legal decisions in this book. No element of your analysis of those cases is more important than careful consideration of the issue. The key to issue spotting is asking yourself: What question do the parties want the court to answer? The next logical step in legal analysis is to ask: What are the reasons and conclusion?

3. Step 3: What Are the Reasons and Conclusion? The issue is the stimulus for thought. The facts and the issue in a particular case get us to start thinking critically about legal reasoning, but the conclusion and the reasons for that conclusion put flesh on the bones of the court’s reaction to the legal issue. They tell us how the court has responded to the issue.

To find the conclusion, use the issue as a helper. Ask yourself: How did the court react to the issue? The answer is the conclusion. The reasons for that conclusion provide the answer to the question: Why did the court prefer this response to the issue rather than any alternative? One part of the answer to that question is the answer to another question: What are the relevant rules of law?

4. Step 4: What Are the Relevant Rules of Law? The fourth step in legal reasoning reveals another difference from general nonlegal reasoning. The issue arises in a context of existing legal rules. We do not treat each legal dispute as if it were the first such dispute in human history. A court has already responded to situations much like the ones now before it. The historical record of pertinent judicial decisions provides a rich source of reasons on which to base the conclusions of courts.

These prior decisions, or legal precedents, provide legal rules to which those in a legal dispute must defer. Thus, the fourth step in legal reasoning requires a focus on those rules. These legal rules are what the parties to a dispute must use as the framework for their legal claims. How those rules and the reasoning and conclusions built on them are expressed, however, is not always crystal clear. Hence, another question—one that starts the critical thinking evaluation of the conclusion—is: Does the legal argument contain significant ambiguity?

5. Step 5: Does the Legal Argument Contain Significant Ambiguity? Legal arguments are expressed in words, and words rarely have the clarity we presume. Whenever we are tempted to think that our words speak for themselves, we should remind ourselves of Emerson’s observation that “to be understood is a rare luxury.” Because legal reasoning is couched in words, it possesses elasticity. It can be stretched and reduced to fit the purpose of the attorney or judge.

As an illustration, a rule of law may contain the phrase public safety. At first glance, as with any term, some interpretation arises in our minds; however, as we continue to consider the extent and limits of public safety, we realize it is not so clear. To be more certain about the meaning, we must study the intent of the person making the legal argument. Just how safe must the public be before an action provides sufficient threat to public safety to justify public intervention?

As a strategy for critical thinking, the request for clarification is a form of evaluation. The point of the question is that we cannot agree with a person’s reasoning until we have determined what we are being asked to embrace.

What we are being asked to embrace usually involves an ethical component. Therefore, an important question to ask is: What ethical norms are fundamental to the court’s reasoning?

6. Step 6: What Ethical Norms Are Fundamental to the Court’s Reasoning? The legal environment of business is established and modified according to ethical norms. A norm is a standard of conduct, a set of expectations that we bring to social encounters. For example, one norm we collectively understand and obey is that our departures are ordinarily punctuated by “good-bye.” We may presume rudeness or preoccupation on the part of someone who leaves our presence without bidding us some form of farewell.

norm

An expected standard of conduct.

Ethical norms are special because they are steps toward achieving what we consider good or virtuous. Goodness and virtue are universally preferred to their opposites, but the preference has little meaning until we look more deeply into the meaning of these noble aims.

ethical norms

Standards of conduct that we consider good or virtuous.

Conversations about ethics compare the relative merit of human behavior guided by one ethical norm or another. Ethical norms represent the abstractions we hold out to others as the most fundamental standards defining our self-worth and value to the community. For example, any of us would be proud to know that others see us as meeting the ethical norms we know as honesty, dependability, and compassion. Ethical norms are the standards of conduct we most want to see observed by our children and our neighbors.

The legal environment of business receives ethical guidance from many norms. Certain norms, however, play a particularly large role in legal reasoning. Consequently, we highlight what we will refer to as the four primary ethical norms: freedom, stability, justice, and efficiency. (See Exhibit 1-2 for clarification of these norms.) As you examine the cases in this text, you may identify other ethical norms that influence judicial opinions. To discover the relevant ethical norm, we must infer it from the court’s reasoning. Courts often do not announce their preferred pattern of ethical norms, but the norms are there anyway, having their way with the legal reasoning. As critical thinkers, we want to use the ethical norms, once we find them, as a basis for evaluating the reasoning.

primary ethical norms

The four norms that provide the major ethical direction for the laws governing business behavior: freedom, stability, justice, and efficiency.

We do so by thinking about the business effects from relying on a different ethical norm. Would a different ethical norm lead the law in a direction that would be more consistent with the goals of our community?

Another element used in arriving at legal conclusions is the device of reasoning by analogy. Part of the critical thinking process in the evaluation of a legal conclusion is another question: How appropriate are the legal analogies?

7. Step 7: How Appropriate Are the Legal Analogies? A major difference between legal reasoning and other forms of analysis is the heavy reliance on analogies. Our legal system places great emphasis on the law, as it has evolved from previous decisions. This evolutionary process is our heritage, the collective judgments of our historical mothers and fathers. We give them and their intellects our respect by using legal precedents as the major support structure for judicial decisions. By doing so, we do not have to approach each fact pattern with entirely new eyes; instead, we are guided by similar experiences that our predecessors have already resolved.

The use of precedent to reach legal conclusions is so common that legal reasoning can be characterized as little but analogical reasoning. An analogy is a verbal device for transferring meaning from something we understand quite well to something we have just discovered and have, as yet, not understood satisfactorily. What we already understand in the case of legal reasoning is the precedent; what we hope to understand better is the current legal dispute. We call on precedent for enlightenment.

analogy

A comparison based on the assumption that if two things are alike in some respect, they must be alike in other respects.

To visualize the choice of legal analogy, imagine that we are trying to decide whether a waitress or waiter can be required to smile for hours as a condition of employment. (What is artificial about such an illustration, as we hope you already recognize, is the absence of a more complete factual picture to provide context.) The employer in question asks the legal staff to find appropriate legal precedents. They discover the following list of prior decisions:

1. Professional cheerleaders can be required to smile within reason, if that activity is clearly specified at the time of employment.

2. Employees who interact regularly with customers can be required as a condition of employment to wear clothing consistent with practice in the trade.

3. Employers may not require employees to lift boxes over 120 pounds without the aid of a mechanical device, under the guidelines of the Employee Health Act.

Notice that each precedent has similarities to, but also major differences from, the situation of the waiter or waitress. To mention only a few:

. Is a smile more natural to what we can expect from a cheerleader than from a waiter or waitress?

. Were the restaurant employees told in advance that smiling is an integral part of the job?

. Is a smile more personal than clothing? Are smiles private, as opposed to clothing, which is more external to our identity?

. Is a plastered-on smile, held in place for hours, a serious risk to mental health?

. Is a potential risk from smiling as real a danger as the one resulting from physically hoisting huge objects?

The actual selection of precedent and, consequently, the search for appropriate analogies are channeled by the theory of logic that we find most revealing in this case. For example, if you see the requirement to smile as an invasion of privacy, you will likely see the second precedent as especially appropriate. Both the precedent and the case in question involve employment situations with close customer contact.

The differences, however, could be significant enough to reject that analogy. Do you see your clothing as part of your essence, in the same fashion as you surely see the facial form you decide to show at any given moment? Furthermore, the second precedent contains the phrase consistent with practice in the trade. Would not a simple field trip to restaurants demonstrate that a broad smile is a pleasant exception?

As you practice looking for similarities and differences in legal precedents and the legal problem you are studying, you will experience some of the fun and frustration of legal reasoning within a business context. The excitement comes when you stumble on just the perfect, matching fact pattern; then, after taking a closer look, you are brought back to earth by those annoying analogical differences that your experience warns you are always present.

Ambiguity, ethical norms, and legal analogies are all areas in which legal arguments may be deficient; but even if you are satisfied that all those considerations meet your standards, there is a final question that must not be overlooked in your critical analysis of a conclusion: Is there relevant missing information?

· Step 8: Is There Relevant Missing Information? When we ask about the facts of a case, we mean the information presented in the legal proceedings. We are, however, all quite aware that the stated facts are just a subset of the complete factual picture responsible for the dispute. We know we could use more facts than we have, but at some point we have to stop gathering information and settle the dispute.

You might not be convinced that the facts we know about a situation are inevitably incomplete; however, consider how we acquire facts. If we gather them ourselves, we run into the limits of our own experience and perceptions. We often see what we want to see, and we consequently select certain facts to file in our consciousness. Other facts may be highly relevant, but we ignore them. We can neither see nor process all the facts.

Our other major source of information is other people. We implicitly trust their intentions, abilities, and perspective when we take the facts they give us and make them our own. No one, however, gives us a complete version of the facts. For several reasons, we can be sure that the facts shared with us are only partial.

Armed with your awareness of the incompleteness of facts, what can you do as a future businessperson or employee to effectively resolve disagreements and apply legal precedents?

You can seek a more complete portrayal of the facts. Keep asking for detail and context to aid your thinking. For example, once you learn that a statute requires a firm to use the standard of conduct in the industry, you should not be satisfied with the following fact:

On 14 occasions, our firm attempted to contact other firms to determine the industry standards. We have bent over backwards to comply with the ethical norms of our direct competitors.

Instead, you will persist in asking probing questions designed to generate a more revealing pattern of facts. Among the pieces of missing information you might ask for would be the extent and content of actual conversations about industry standards, as well as some convincing evidence that “direct” competitors are an adequate voice, representing “the industry.”

(Kubasek 11-15)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.

 

 

 

Applying the Critical Thinking Approach

Now that you have an understanding of the critical thinking approach, you are ready to begin your study of the legal environment of business. Remember to apply each of the questions to the cases as you read them. As an incentive to do the work associated with careful thinking, imagine what it would be like to NOT apply critical thinking in your business careers. You would receive advice, and you would always believe it, as long as the person speaking seemed nice and authoritative. As soon as someone told you what “the law” is, you would, like a sponge, simply proceed to do business as if that single statement about the content of the law is the one and only possible understanding of the law. You would be the mental puppet of the last clever person with whom you spoke. You will agree that this portrait of a businessperson who does not use critical thinking is a recipe for disaster.

After you become proficient at asking these questions of every case you read, you may find that you start asking these evaluative questions in other contexts. For example, you might find that, when you read an editorial in the Wall Street Journal, you start asking whether the writer has used ambiguous terms that affect the quality of the reasoning, or you start noticing when important relevant information is missing. Once you reach this point, you are well on your way to becoming a critical thinker whose thinking skills will be extremely helpful in the legal environment of business.

(Kubasek 15-16)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.

 

 

 

Assignment on the Internet

You have now been introduced to the critical thinking steps that create a working strategy to evaluate legal reasoning. In the same manner that you evaluated United States of America v. Martha Stewart and Peter Bacanovic, practice evaluating the legal reasoning in a case of your choosing.

Go to www.law.cornell.edu for current legal issues and cases. Find a case of interest to you, and evaluate the reasoning using the critical thinking steps outlined in this chapter. Burwell v. Hobby Lobby, for example, would be a fun and important business law case to look at. The following websites on critical thinking may assist you in evaluating legal reasoning.

(Kubasek 16)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.

 

 

 

On the Internet

Use this site for practice, identifying reasons and conclusions in arguments.

www.austhink.org/critical This site is a compendium of useful critical thinking websites.

pegasus.cc.ucf.edu/~janzb/reasoning Both sites contain numerous links for those wishing additional reading and practice with the critical thinking skills learned in this chapter.

(Kubasek 16)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.

 

 

For Future Reading

1. Browne, M. Neil, and Stuart Keeley. Asking the Right Questions: A Guide to Critical Thinking (11th ed.). Upper Saddle River, NJ: Prentice Hall, 2014.

2. Damer, T. Edward. Attacking Faulty Reasoning: Practical Guide to Fallacy-Free Arguments (7th ed.). Belmont, CA: Wadsworth, 2012.

3. LeGault, Michael R. Think: Why Crucial Decisions Can’t Be Made in the Blink of an Eye. New York: Threshold Editions, 2006.

(Kubasek 16)

Kubasek, Nancy K., Bartley Brennan, M. Browne. The Legal Environment of Business: A Critical Thinking Approach, 8th Edition. Pearson Learning Solutions, 12/2017. VitalBook file.

*****The citation provided is a guideline. Please check each citation for accuracy before use.