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CHAPTER 1
Introduction to Contemporary
Hospitality Law
CONTENTS
A. Chapter Competencies
B. What Is Law?
C. Principles of Hospitality Law
D. Sources of Law
E. Attributes of Law
F. How to Read a Case
G. Answers to End-of-Chapter
Questions
Chapter Summary
Chapter 1 provides hospitality students with a definition of what law is. One definition is “a body of rules that
people must conform their conduct.” Our law comes from four sources: the Constitution, statutes, common
law, and administrative law.
Students will study the rule of stare decisis, which encourages judges to decide cases consistent with prece-
dent, absent good reason to deviate. The objective is this rule is to achieve consistency in the law.
This chapter provides an opportunity for students to identify between civil and criminal law. Civil law
involves wrongs against individuals, whereas, criminal law involves wrongs against society.
The final section of the chapter discusses how to read legal cases. There are four main elements to identify
in a case: the facts, the issue, the decision, and the reasoning. Students should also consider the implications of
the case for the hospitality industry.
A. Chapter Competencies
Suggestion: You may want to give a copy of the list of competencies for each chapter to the students
so they can use it as a study guide.
After studying Chapter 1, the student should be able to
1. give at least one relevant definition of “law.”
2. describe the scope of hospitality law.
3. state, at the basic level, the rights and duties of hospitality services providers and their customers.
4. briefly describe the two historical factors that contributed to the harshness of the hospitality law
and affected the reputation of the hospitality industry.
5. list the four sources of law.
6. define “constitutional law.”
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7. define “interstate commerce.”
8. define “legislative process.”
9. identify the primary lawmaking body.
10. list the functions of the Constitution of the United States of America.
11. define “statutory law.”
12. define “legislature.”
13. define “legislators.”
14. distinguish between a statute and an ordinance.
15. define and describe “common law.”
16. define “case decision.”
17. define “precedent.”
18. define “stare decisis.”
19. describe briefly the purpose of “stare decisis.”
20. discuss the relationship between statutes and the Constitution.
21. discuss the relationship between statutes and common law.
22. define “administrative law.”
23. define “administrative agency.”
24. name at least three administrative agencies governing the hospitality industry.
25. list at least three attributes of law.
26. describe briefly the role of the judge.
27. state the two classifications of law.
28. distinguish between civil and criminal law.
29. give examples of civil law.
30. define “contract.”
31. define “tort.”
32. list and define the three torts.
33. define “cases.”
34. identify and define the four elements of a case.
B. What Is Law?
❊Ask the students their interpretation of law and what they think law is. Make a list on the
board.
❊Compare the definitions with the list.
❊Why do we need laws? Discuss the purpose of law.
❊Use examples of laws to familiarize the students with the framing and legal terminology
used in the descriptions of laws. Use at least one example from each level: federal, state, and
local.
C. Principles of Hospitality Law
❊Discuss the scope of hospitality law.
❊List the types of businesses within the hospitality industry that are covered by the hospitality laws.
❊Discuss the basic rights and obligations of hospitality product/service providers and their customers.
❊Discuss the origins and historical challenges in the evolution of hospitality law and the state of
the hospitality industry today. It is also helpful to look at the history and evolution of the
hospitality industry from ancient times. (Refer to any “Introduction to Hospitality Industry”
textbook.)
2■Chapter 1
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D. Sources of Law
❊List and discuss the four main sources of our law: the Constitution, statutes, common law, and
administrative law.
❊Constitutional law.
■Delegated powers: expressly allocated to the federal government in the Constitution.
■Interstate commerce: business affecting more than one state.
■Legislative process: the process by which the federal government and other government units
adopt laws.
■Discuss the difference between a statute and an ordinance.
■If a statute is found to conflict with the Constitution, the statute is declared void.
❊Common law.
■Legal rules evolved from decisions of judges and from customs and practices in a society.
■Originated from the United Kingdom (Britain).
■Intended to be common or uniform.
■Modified as major economic, sociocultural, and technological forces influenced businesses and
their methods.
■A case decision is an interpretation of the law applied by the judge to a set of facts in a given case.
■Precedent: a case decision used as a basis for deciding future cases.
■Stare decisis: Latin for “the matter stands decided” if there is no reason not to follow the precedent.
In case of circumstances such as societal forces or context, stare decisis might not bind the judge
to follow previous decisions.
■To some extent, statutes and common law are intertwined.
■Sometimes statutes are adopted to modify common law.
❊Administrative law.
■Laws that define the powers, limitations, and procedures of administrative agencies.
■An administrative agency is a governmental subdivision charged with administering legislation
that applies to a particular industry.
■Administrative agencies are a part of the executive branch.
■Laws adopted by administrative agencies are called regulations.
E. Attributes of Law
❊The role of the judge.
■A significant role: makes the law when no precedent or statute exists, interprets the law in
cases where a precedent or statute applies.
■A judge who reviews decisions of other judges is called an appellate judge.
❊Civil and criminal law.
■Discuss the differences between civil and criminal laws and their remedies.
❊Civil law.
■Contract: an agreement between two or more parties that is enforceable in a court of law.
•Represents law made by individuals.
■Tort: a violation of a legal duty by one person that causes injury to another. Breach of con-
tract is not a tort.
■Discuss the three key torts: negligence, trademark infringement, and fraud.
F. How to Read a Case
1. A judge’s written decisions are called cases and the books in which they are published are called
casebooks. These cases are part of the common law.
Introduction to Contemporary Hospitality Law ■3
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Key Terms
4■Chapter 1
Administrative agency Government subdivision
changed with administrating legislation that applies
to a particular industry.
Administrative law Refers to laws that define powers,
limitations, and procedures of administrative agencies.
Assault Intentionally causing, or putting someone
in fear of, harmful physical contact.
Casebooks Books in which cases are published.
Case decision Interpretation of the law applied by
a judge to the set of facts in a given case.
Cases Judges’ written decisions.
Civil law Wrong done to an individual.
Common law Legal rules that evolved from deci-
sions of judges and custom and practice, gradually
modified as habits were modified, as new invention
created new wants and conveniences, and with new
methods of doing business.
Compensatory damage Money given to compen-
sate for injuries.
Congress The primary law making body of the
federal government.
Constitutional law Development powers allocated
to the federal government in the Constitution.
Contract An agreement between two or more par-
ties that is enforceable in court.
Criminal law Wrong considered to be inflicted on
society.
Damage The remedy sought by the injured party
in a civil case.
Decisions A judge’s response to the issue.
Delegated powers Powers expressly allocated to
the federal government in the Constitution.
Facts Circumstances that gave rise to a lawsuit.
Fraud Intentionally untruthful statement made to
induce reliance by another person.
Interstate commerce Business that affects more than
one state.
Issue Legal question that the parties want
resolved.
Law A body of rules to which people must conform
their conduct; a form of control; a set of rules used by
judges in deciding disputes.
Legislative process The method by which Congress
adopts laws.
Legislature A lawmaking body whose members are
elected to office by the citizenry.
Legislation The elected members of the legislature.
Negligence Law adopted by local legislature.
Ordinance Law adopted by local legislative.
Precedents Case decisions that are followed in later
cases.
Probation A system whereby criminal offenders
remount out of jail but are supervised by a court
employee called a probation officer.
Punitive damages Money in excess of compensa-
tory damages; punishes or makes an example of the
defendant; are awarded only in cases where defen-
dant’s wrongful acts include violence, malice, fraud,
or a similar egregious wrong.
Rape Sexual intercourse that is against the vic-
tim’s will.
Regulations Laws adopted by administrative
agencies.
Stare decisis Process of following earlier cases;
gives some uniformity to the law.
Statute Law adopted by federal or state legislation.
Statutory law Law promulgated by legislation and
generally agreed on by the executive (president, gov-
ernment, or mayor).
Theft of service Use of a service (for example, a
hotel room) without paying and with intent to avoid
payment.
Trademark infringement Use of another com-
pany’s business name or logo without permission.
2. Discuss the four elements of a case.
3. Use the Application Questions at the end of Chapter 1 in the textbook as an exercise to identify
the four elements of the case.
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