TEST BANK for Law and Business Administration in Canada, 15th Edition by J. Smyth, Dan Soberman, A. by welldoneassistant

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

1) A simple definition of law would be misleading because law is so a. bound up with the rule of law. b. diverse and complex. c. difficult to define. d. none of the above e. all of the above Answer: b Diff: 2 Type: MC Topic: The Role of Law Skill: Recall 2) We need to have law because it a. regulates individuals’ interactions with one another. b. gives the government the power to act for the benefit of society in general. c. provides an element of certainty in determining contractual and property rights. d. protects persons, property, and society, and prohibits conduct that society believes is harmful. e. all of the above Answer: e Diff: 2 Type: MC Topic: The Role of Law Skill: Recall 3) The fact that laws that appear to be unjust must still be obeyed suggests that a. justice is merely the result of the influence of ethics. b. justice is merely a product of social morals. c. there is a difference between good laws and bad ones. d. in reality, we must think of justice as nothing more than the result of our legal system. e. those who make the laws just do not care. Answer: d Diff: 3

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Type: MC Topic: The Role of Law Skill: Applied 4) The Canadian legal profession is organized on a provincial basis with each province having its own “bar” society. However, a member of any provincial bar may appear before a. the House of Lords in England. b. the International War Crimes Tribunal. c. the Supreme Court of Canada. d. any Human Rights Tribunal in any province. e. any Landlord and Tenant Board Tribunal in any province. Answer: c Diff: 3 Type: MC Topic: Legal Risk Management Skill: Recall 5) Joe hired Julie, a lawyer, to defend him on assault charges. At their first meeting he told her the details concerning his involvement in the assault. After a dispute between Joe and Julie in relation to legal fees, Joe decided to retain a new lawyer. The police attended at Julie’s office to ask her questions concerning what Joe told her about the assault. In these circumstances a. the solicitor/client privilege does not allow Julie to reveal any communications she had with Joe without his approval. b. given that the solicitor/client relationship has ended, Julie is at liberty to disclose the information. c. the solicitor/client privilege does not extend to admissions by clients of wrongdoing so communications must be disclosed. d. Julie is at liberty to disclose any information in relation to the dispute with Joe over fees but not in relation to communications about the assault. e. the Canada Evidence Act permits Julie to disclose any information once the retainer has ended. Answer: a Copyright © 2020 Pearson Canada Inc. 1-2

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Diff: 3 Type: MC Topic: Legal Risk Management Skill: Applied 6) A compliance officer employed by a business for purposes of monitoring legislative requirements applicable to the business ensures a. that outside counsel are hired by the business on a general retainer basis to respond to urgent matters. b. that the business complies with all regulatory and legislative requirements to avoid claims, fines and other possible penalties or sanctions. c. that probationary employees are screened and monitored appropriately by the business in the 90 day period. d. that the business pays outstanding fines. e. that someone attends on all Small Claims Court matters where outside counsel are not required. Answer: b Diff: 3 Type: MC Topic: Legal Risk Management Skill: Applied 7) When we say that the law is part of every facet of business, we mean that a. it is central to business interaction with customers, suppliers, competitors, and government. b. business cannot succeed without understanding the law. c. it outlines what we do, how to do it, and what not to do. d. the failure of businesses to comply with the law may result in criminal, regulatory, and/or civil liability. e. all of the above Answer: e Diff: 2 Type: MC Topic: Law and Business Copyright © 2020 Pearson Canada Inc. 1-3

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Skill: Recall 8) Effective operation of a business requires that business managers a. rely on lawyers to form the right questions and answers for legal issues. b. do not have to become experts in the activities of their businesses. c. simply rely on the decisions made by those in authority above them. d. do not have to familiarize themselves with the law. e. must know the law and must understand the legal risks associated with the everyday choices that they make. Answer: e Diff: 2 Type: MC Topic: Law and Business Skill: Recall 9) A risk management plan a. does not require regular revision. b. does nothing to promote the better conduct of a business. c. is only necessary in sophisticated businesses. d. does not necessarily involve a lawyer in every part of the overall plan. e. helps a business to identify and anticipate potential legal liability. Answer: e Diff: 2 Type: MC Topic: Law and Business Skill: Applied 10) Which of the following will a business use to reduce its liability? a. risk reduction b. risk absorption c. risk avoidance d. risk transfer e. all of the above

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Answer: e Diff: 1 Type: MC Topic: Law and Business Skill: Recall 11) To implement a risk management plan, a business must first a. prioritize the risks. b. develop effective strategies to deal with the risks. c. revise the plan on a regular basis. d. implement the plan. e. conduct a legal audit of the business operation. Answer: e Diff: 3 Type: MC Topic: Law and Business Skill: Applied

12) In deciding whether a statute is valid or invalid, the court must consider a. the effect that the statute has. b. the purpose of the statute. c. whether it should interpret the statute broadly. d. whether it should interpret the statute narrowly. e. all of the above Answer: e Diff: 2 Type: MC Topic: The Courts and Legislation Skill: Recall 13) A binding code of conduct is a a. general code of conduct that is available to anyone.

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

b. code of conduct established voluntarily by industry. c. code of conduct that governments impose on business and industry. d. code of conduct that regulates specified activities, such as those of professionals. e. code of conduct that a firm or business imposes on itself. Answer: d Diff: 2 Type: MC Topic: Law and Business Ethics Skill: Recall 14) When a court interprets a statute narrowly, the result will most likely be that a. the statute will be found to fall inside the power of the government that made it. b. the court will change the wording in the statute so that it makes sense. c. the statute will be found to be outside, or ultra vires, the government that made it. d. the statute will be struck down. e. the court will send the statute back to the government that made it for revision. Answer: a Diff: 3 Type: MC Topic: The Courts and Legislation Skill: Applied 15) When we say that the law is linked to moral and ethical standards, we mean that a. the law is based on ethics. b. ethical behaviour is generally considered to be a higher standard. c. ethics and morality are one and the same. d. the fundamental truths that give rise to the law include ethics and morality. e. the moral and ethical values of a society as a whole shape the development of the law. Answer: e Diff: 3 Type: MC Topic: The Role of Law Skill: Applied Copyright © 2020 Pearson Canada Inc. 1-6

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

16) Under our legal system, which is derived from English common law, a. our courts simply resolve the dispute based on common sense. b. our courts look to and apply principles of law that have evolved out of cases dealing with the same subject matter as does the dispute between the private parties. c. our courts look to the way other countries have resolved disputes between private parties. d. our courts look to legislation passed by the federal and provincial governments to resolve disputes between private parties. e. our courts look to the constitution to resolve disputes between private parties. Answer: b Diff: 2 Type: MC Topic: Who Makes Law? Skill: Recall

17) In a federal system such as our own, the role of the courts is to a. draft legislation. b. dispense the law, which includes interpreting it as well. c. advise Parliament as to whether its laws are just and fair. d. ensure that the law is handed out equally to every Canadian. e. make it seem that we have a just legal system, when in fact we do not. Answer: b Diff: 3 Type: MC Topic: The Courts and Legislation Skill: Applied 18) The most common complaint about judges when they are interpreting statutes or legislation is that they a. are much too powerful and have no regard for anyone other than themselves. b. are usurping the powers of Parliament and the provincial legislatures. c. are too political and are usurping the powers of Parliament and the provincial legislatures. Copyright © 2020 Pearson Canada Inc. 1-7

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

d. have no regard for the average citizen. e. are too political. Answer: c Diff: 3 Type: MC Topic: Challenging the Validity of a Statute Skill: Applied 19) Canadian law comes from a variety of sources including all of the following except a. the constitution or basic law. b. legislation or statutory law. c. regulations. d. court decisions. e. Wikipedia. Answer: e Diff: 2 Type: MC Topic: Who Makes Law? Skill: Recall 20) Legislation is the name given to a. laws that are made by judges. b. laws that are made by members of the government. c. the general system of laws of a country. d. laws that are made by Parliament and provincial legislatures. e. none of the above Answer: d Diff: 3 Type: MC Topic: Who Makes Law? Skill: Recall 21) In a federal country such as Canada, the Supreme Court of Canada, and not Parliament, usually has the last word on the law because Copyright © 2020 Pearson Canada Inc. 1-8

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

a. the judges of the Supreme Court of Canada are appointed by the federal government. b. there are two distinct levels of government. c. the Supreme Court of Canada is the highest court in the land. d. the Supreme Court of Canada is made up of judges who make law. e. Parliament only makes laws. Answer: b Diff: 3 Type: MC Topic: Who Makes Law? Skill: Applied 22) The Supreme Court of Canada performs several roles. One role it does NOT perform is a. protector of civil liberties. b. an umpire between the various levels of government. c. determining the validity of legislation. d. interpreter of legislation. e. resolving disputes between private parties. Answer: b Diff: 3 Type: MC Topic: The Courts and Legislation Skill: Applied 23) Law is derived from a variety of sources. These include the constitution, legislation, and a. the Supreme Court of Canada and subordinate legislation. b. court decisions handed down by judges. c. statements made by ministers and administrative rulings. d. media reports and other news. e. the cabinet. Answer: b Diff: 3 Copyright © 2020 Pearson Canada Inc. 1-9

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Type: MC Topic: Who Makes Law? Skill: Applied 24) Whenever a law is determined by a court to be outside the jurisdiction of the legislature, and beyond its powers, the law or provision is said to be a. a federal law. b. ultra vires and therefore void. c. the result of residual power. d. excess of jurisdiction and therefore invalid. e. the result of concurrent powers. Answer: b Diff: 3 Type: MC Topic: The Courts and Legislation Skill: Recall 25) Federalism is a. the system of government that applies in the Province of Quebec. b. the system of government in which the central government makes laws for all the people. c. the system of government in which power is divided between two levels of government. d. a system of government in which the various governments, such as federal and provincial, all come together to make laws for all the people. e. the system of government that believes in health care for all. Answer: c Diff: 3 Type: MC Topic: Who Makes Law? Skill: Recall 26) The Canadian Charter of Rights and Freedoms is said to be entrenched in the Canadian constitution. This means that a. it is not part of the Human Rights Act. Copyright © 2020 Pearson Canada Inc. 1-10

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

b. it is a rule of the Canadian constitution that must be considered by judges only. c. the rights set out in the Charter are absolute. d. it cannot be repealed by an ordinary act of Parliament or of the provincial legislatures. e. judges are given the authority to resolve Charter problems. Answer: d Diff: 2 Type: MC Topic: The Charter of Rights and Freedoms Skill: Recall 27) Section 15 of the Canadian Charter of Rights and Freedoms deals with a. its application to citizens of the United States. b. equality rights. c. national politics. d. the applicability of the Human Rights Act. e. legal rights. Answer: b Diff: 2 Type: MC Topic: The Charter of Rights and Freedoms Skill: Applied 28) Section 33 of the Charter allows the legislature to pass legislation that overrides the fundamental freedoms specified in the Charter only if a. the legislation expressly declares that it "shall operate notwithstanding" a provision included in the Charter. b. a court determines that the freedoms can be overridden. c. two-thirds of the provinces having at least 50 percent of the total population of Canada approve. d. the legislation in question does not violate the Human Rights Act. e. five years have passed since the legislation was first proposed. Answer: a Diff: 3

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Type: MC Topic: The Charter of Rights and Freedoms Skill: Applied 29) The Charter applies to governments and governmental activities. It has limited application a. to municipal governments. b. between private persons. c. to Courts of Appeal. d. to Small Claims Court. e. to Human Rights hearings. Answer: b Diff: 2 Type: MC Topic: The Charter of Rights and Freedoms Skill: Recall

30) The "notwithstanding" provision in the Charter of Rights and Freedoms is one that a. allows a court to decide that notwithstanding the fundamental freedoms specified in the Charter, the judgment of the court is supreme. b. allows a legislature to pass laws that override the fundamental freedoms specified in the Charter. c. allows a legislature to pass a law that provides that notwithstanding the law that has been passed the Charter of Rights and Freedoms will still apply. d. allows a legislature to pass a law notwithstanding a court order that prohibits it from doing so. e. allows a legislature to pass laws that override the fundamental freedoms specified in the Charter if the provision specifically states that it shall operate notwithstanding the freedoms specified in the Charter. Answer: e Diff: 3 Type: MC Topic: The Charter of Rights and Freedoms Skill: Applied

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

31) Which of the following is NOT part of the role or function of the courts? a. to interpret legislation b. to resolve disputes between parties c. to protect civil liberties d. to arrest offenders e. to determine the validity of legislation Answer: d Diff: 2 Type: MC Topic: The Courts and Legislation Skill: Recall 32) Section 1 of the Charter of Rights and Freedoms says that the rights in the Charter are not absolute. Section 1 a. enables Parliament to override decisions of the courts regarding the Charter. b. allows the courts to decide whether it is necessary to infringe on rights in order to maintain the values of a free and democratic society. c. permits the Supreme Court of Canada to amend the Charter to conform to the values of a free and democratic society. d. enables provincial legislatures to override decisions of the courts regarding the Charter. e. none of the above Answer: b Diff: 3 Type: MC Topic: The Charter of Rights and Freedoms Skill: Recall 33) Any provision found by a court to be outside of the legislature’s jurisdiction and therefore beyond its powers is referred to as a. residual powers. b. concurrent powers. c. rule of law. d. ultra vires. e. paramountcy. Copyright © 2020 Pearson Canada Inc. 1-13

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Answer: d Diff: 3 Type: MC Topic: Federalism in the Constitution Skill: Recall 34) If a statute states that it "shall operate notwithstanding" certain rights, this means that permission of parliament is needed to infringe on Charter rights. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Diff: 2 Type: TF Topic: The Charter of Rights and Freedoms Skill: Recall 35) A simple definition of law would be misleading because law is so diverse and complex. a. True Correct: Correct b. False Incorrect: Incorrect Answer: a Diff: 3 Type: TF Topic: The Role of Law Skill: Recall 36) Certain fundamental truths, such as "all men are created equal," have been incorporated into our laws. a. True Correct: Correct b. False Incorrect: Incorrect Copyright © 2020 Pearson Canada Inc. 1-14

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Answer: a Diff: 1 Type: TF Topic: The Role of Law Skill: Recall 37) Responsibility for the consequences of breaking the law is often referred to as legal liability. a. True Correct: Correct b. False Incorrect: Incorrect Answer: a Diff: 2 Type: TF Topic: How Does Law Influence Behavior Skill: Recall

38) The law reflects the highest level of moral and ethical standards that are universally accepted by all people. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Diff: 2 Type: TF Topic: The Role of Law Skill: Applied 39) Law and justice must, of necessity, coincide regardless of whether the result is morally right or correct. a. True Incorrect: Incorrect b. False Correct: Correct Copyright © 2020 Pearson Canada Inc. 1-15

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Answer: b Diff: 3 Type: TF Topic: The Role of Law Skill: Applied 40) Legal liability is the term used when a person breaks the law. a. True Correct: Correct b. False Incorrect: Incorrect Answer: a Diff: 1 Type: TF Topic: Law and Business Skill: Applied 41) To run a successful business, the owners and managers of that business are not required to know the law. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Diff: 1 Type: TF Topic: Legal Risk Management Skill: Recall 42) A lawyer’s right to have all communications with his client kept confidential is referred to as solicitor/client privilege. a. True Incorrect: Incorrect b. False Correct: Correct

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Answer: b Diff: 3 Type: TF Topic: The Legal Profession Skill: Recall 43) Developing a legal risk management plan is the best way to ensure that a business is managed and run properly. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Diff: 2 Type: TF Topic: Legal Risk Management Skill: Recall 44) In commerce today, businesses have no need to live up to higher ethical standards. In other words, businesses need not consider the concept of corporate responsibility. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Diff: 2 Type: TF Topic: Law and Business Ethics Skill: Applied 45) In Canada, only the federal and provincial governments make the laws. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Copyright © 2020 Pearson Canada Inc. 1-17

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Diff: 1 Type: TF Topic: Who Makes Law? Skill: Recall 46) In any legal system, justice is merely the end result of that legal system and should not be equated with moral right and wrong. a. True Correct: Correct b. False Incorrect: Incorrect Answer: a Diff: 3 Type: TF Topic: The Role of Law Skill: Applied 47) The law is central to a business's interactions with its customers, suppliers, competitors, and government. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Diff: 1 Type: TF Topic: Law and Business Skill: Recall/Applied 48) The rights prescribed in the Charter of Rights and Freedoms are absolute. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Diff: 2 Copyright © 2020 Pearson Canada Inc. 1-18

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Type: TF Topic: The Charter of Rights and Freedoms Skill: Recall 49) The literal approach to the interpretation of statutes requires a consideration of the plain meaning of the provision of a statute. a. True Correct: Correct b. False Incorrect: Incorrect Answer: a Diff: 2 Type: TF Topic: Challenging the Validity of a Statute Skill: Recall 50) Unlike United States Supreme Court judges, Canadian Supreme Court judges are not subjected to a public and politicized confirmation process. a. True Correct: Correct b. False Incorrect: Incorrect Answer: a Diff: 2 Type: TF Topic: The Role of Judges Skill: Recall 51) Uber is an extremely popular form of transportation. Many users are not concerned with the fact that Uber initially failed to comply with numerous laws. Make an argument that in circumstances where the public stands to benefit significantly, a corporate entity may disregard existing laws if they are too expensive or onerous to comply with. Answer: An important consideration of lawmakers is the effect a particular law or regulation will have on the public. If there is a significant benefit to the public then disregarding a regulatory law may be a factor that municipal authorities could consider before charging. However, the failure of municipalities to prosecute Uber would lead to significant Copyright © 2020 Pearson Canada Inc. 1-19

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

unfairness to taxi drivers who have at all material times complied with significant obligations in relation to permits, insurance and bonding. Diff: 3 Type: ES Topic: Is It Ever Right to Break the Law Skill: Applied

52) What is subordinate legislation? Answer: Subordinate legislation is the rules that are passed by a body designated in a statute, pursuant to the provisions of that statute. Diff: 2 Type: ES Topic: Who Makes Law? Skill: Recall 53) There are five distinct steps in developing a legal risk management plan. List these steps. Answer: Conduct a legal audit of the business; prioritize the risks; develop a strategy to address each risk; implement the plan; and regularly review and update the plan. Diff: 2 Type: ES Topic: Legal Risk Management Skill: Recall 54) Canada is a federal system. Briefly explain what this means. Answer: In the Canadian federal system there are two levels of government: the Federal government, or Parliament, and the Provincial governments. The power is shared between each under sections 91 and 92 of the Constitution Act. Diff: 2 Copyright © 2020 Pearson Canada Inc. 1-20

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Type: ES Topic: The Courts and Legislation Skill: Applied 55) What do we mean when we say that the two levels of government have concurrent powers? Answer: Concurrent powers describes the situation when, under the constitution, both the federal and provincial governments appear to have the same authority to regulate a given activity. Diff: 2 Type: ES Topic: The Courts and Legislation Skill: Recall 56) Generally speaking, there are three types of codes of conduct that may be imposed on a business. List or state these codes of conduct. Answer: The three types of codes of conduct are binding codes, voluntary codes and self-imposed codes. Diff: 1 Type: ES Topic: Law and Business Ethics Skill: Recall 57) Generally speaking, there are two reasons why a court will declare a statute invalid. State these two reasons. Answer: 1) The subject matter of the statute is outside the jurisdiction of the government that passed it; and 2) the statute violates the Charter of Rights and Freedoms. Diff: 1 Type: ES Topic: Challenging the Validity of a Statute Skill: Recall Copyright © 2020 Pearson Canada Inc. 1-21

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

58) In a federal country such as Canada, the Supreme Court often has the last word. Explain. Answer: In a federal country such as Canada, there are two levels of government, the national government and the provincial governments. Pursuant to the Constitution Act, 1867, each level of government has an independent existence and its own sphere of activity. There are also areas where the two levels of government have concurrent jurisdiction. When problems arise with respect to jurisdiction, it is the Supreme Court of Canada that makes a final determination as to the interpretation of the law and the exercise of jurisdiction. Diff: 3 Type: ES Page Reference: 10 Topic: The Courts and Legislation Skill: Recall 59) List four kinds of rights that are covered by the Canadian Charter of Rights and Freedoms. Answer: These are equality, mobility, legal, and democratic rights. Diff: 2 Type: ES Topic: The Charter of Rights and Freedoms Skill: Recall 60) Explain the notion of concurrent powers as it pertains to the federal system of government in Canada. Answer: A federal system of government is different from a unitary system of government. In a unitary system of government, such as the system of government that exists in England, there is only one level of government that makes laws. In a federal system of government such as the systems of government of the United States and Canada, there are two levels of government, the federal government and the provincial or state governments, and lawmaking power is divided between these two levels of government. Each level of government has jurisdiction to make laws with respect to certain areas. Sometimes the power of the federal and provincial governments may overlap in certain areas. When this Copyright © 2020 Pearson Canada Inc. 1-22

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

happens, it is said that the federal and provincial governments have concurrent jurisdiction. Diff: 3 Type: ES Topic: Who Makes Law? Skill: Applied 61) What burden does a private person have when attacking the constitutional validity of legislation? Answer: The only burden that a private person has attacking the constitutional validity of legislation is to show that a constitutionally guaranteed right has been infringed by the law. The burden of the individual ends at this point in time. The burden then shifts to the government to show that the interference is justifiable in a free and democratic society. Diff: 2 Type: ES Topic: The Charter of Rights and Freedoms Skill: Recall

62) A business can be managed and run in either a prudent and responsible manner or a stupid manner. Explain how a prudent and responsible businessperson would manage and run a new business that he or she has just began as compared to a person who was not prudent or responsible. Answer: A prudent and responsible businessperson would first familiarize him- or herself with the law. Then he or she would develop a risk management plan that deals with the risks, prioritize them in relation to the business, and implement the plan. Further, he or she would regularly review and update the plan to take into consideration any change of laws or any new laws. Finally, in order to better manage the business, he or she would voluntarily implement a code of conduct by creating one or looking to see whether the business was already governed by one, as in the case of many professions. A businessperson who was neither prudent nor responsible would not do any of these things but would simply run the business as he or she chose, maximizing the legal risks affecting the business and exposing it to all sorts of liability. Diff: 3 Type: ES Copyright © 2020 Pearson Canada Inc. 1-23

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Topic: Legal Risk Management Skill: Applied 63) You are a judge sitting on the Supreme Court of Canada, which has been asked to rule on the interpretation of a provision in a new statute and to decide whether it is constitutional. What are the two approaches that you can take and what would be the outcome of each? Answer: The first approach is to determine whether the words should be interpreted in a broad or restrictive manner. A broad interpretation might result in the provision being found unconstitutional, while a restrictive meaning would leave it valid. The second approach is to try to avoid interpreting the provision so narrowly that the result does not interfere with existing private rights, which may have the effect of frustrating any intended reform. Diff: 3 Type: ES Topic: Challenging the Validity of a Statute Skill: Applied 64) In Canada, law comes from a variety of sources. State each source and explain what type of law comes from it. Answer: In Canada, our law comes from the Constitution, which is the basic law from which all other laws draw their power. After the Constitution, the law comes from legislation passed by both the federal and provincial governments, as well as subordinate legislation called regulations, which are passed by a specific body referred to in that legislation, and decisions made by administrative tribunals set up by the legislation. Finally, law comes from decisions of the courts, based on principles of law that have been developed in earlier court decisions and to which we refer as case law. Diff: 2 Type: ES Topic: Who Makes Law? Skill: Applied 65) The Charter of Rights and Freedoms provides that all are entitled to certain fundamental freedoms. What are these fundamental freedoms? Are there any limits on these freedoms?

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

Answer: Section 2 of the Charter of Rights and Freedoms provides that everyone has the following freedoms: (a) freedom of conscience and religion; (b) freedom of thought belief, expression, opinion, including freedom of the press and communication; (c) freedom of peaceful assembly; and (d) freedom of association. These freedoms are not absolute. Section 1 of the Charter provides that the above freedoms are all subject to reasonable limits as can be demonstrably justified in a free and democratic society. Diff: 2 Type: ES Page Reference: 12 Topic: The Charter of Rights and Freedoms Skill: Applied 66) Explain how the introduction of the Charter of Rights and Freedoms increased the protection of human rights in Canada. Answer: Before the introduction of the Charter, human rights were not entrenched in the Constitution. After the introduction of the Charter, the court could strike down government action that did not conform to the Charter. Government could override court decisions regarding human rights only by passing legislation notwithstanding the rights contained in it. The Charter can be amended not by ordinary legislation but only by using the difficult amendment process contained in it. Diff: 2 Type: ES Topic: The Charter of Rights and Freedoms Skill: Recall 67) A bartender employed in a licensed establishment over-serves a patron. As a result of the over-service, the patron physically assaults another patron by striking him with a beer bottle. Identify and describe the three forms of liability that may arise as a result of this single incident. Answer: There may very well be criminal charges laid against the patron who committed the assault. This is a matter of public law and would impose the most serious consequences as a result of this criminal act. Additionally, the injured patron may very well sue for compensation as a result of the injuries sustained. The court would be required to determine whether the patron who committed the assault and/or the bartender who overserved him are civilly liable. Finally, liquor licence authorities may request a tribunal Copyright © 2020 Pearson Canada Inc. 1-25

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 1: Law, Society, and Business

hearing to determine whether the tavern is responsible for violating regulatory laws that govern the service of alcohol in a licensed establishment. Diff: 3 Type: ES Topic: Forms of Legal Liability Skill: Applied

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

1) In addition to the two basic categories of public and private law, law is divided further into two more categories, which are a. criminal and contract law. b. domestic and international law. c. criminal and tort law. d. public and private law. e. substantive and procedural law. Answer: e Diff: 1 Type: MC Topic: Classifying Law Skill: Recall 2) The form of law that was adopted by the whole of continental Europe was one in which a. the law was not codified. b. the law was both codified and based on previous cases. c. the law was based on decisions of previous cases. d. the law was codified. e. the law was partly, but not fully, codified. Answer: d Diff: 1 Type: MC Topic: Legal Systems: Civil Law and Common Law Skill: Recall 3) The fact that similar cases are treated alike a. increases the number of disputes that go to court. b. reduces the number of disputes that go to court by allowing parties to anticipate the results based on prior outcomes. c. does not help parties in a dispute to anticipate how a case will turn out based on prior outcomes. d. does nothing to reduce the number of disputes that end up in the courts. e. none of the above Copyright © 2020 Pearson Canada Inc. 2-1

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

Answer: b Diff: 2 Type: MC Topic: Legal Systems: Civil Law and Common Law Skill: Recall/Applied 4) When we talk about predictability being a major element of law, we mean that a. although the law is predictable, the outcome of a given dispute between people is not. b. people should be more likely to be able to predict when they can circumvent a law. c. the law itself is not predictable, only the cases that are decided. d. by using common sense, the decision of any court can be determined in advance. e. people should be able to find out where they stand and how to act with reasonable certainty. Answer: e Diff: 3 Type: MC Topic: Legal Systems: Civil Law and Common Law Skill: Recall/Applied 5) The rule stare decisis a. is a hard and fast rule that has qualifications attached to it that allow judges to depart from it. b. is merely a principle that applies in those countries where the law is codified. c. is not a hard and fast rule and is not always followed. d. is a hard and fast rule that is always followed. e. has no place in a system based on common law. Answer: c Diff: 2 Type: MC Topic: Common Law: The Theory of Precedent Skill: Recall 6) A valid argument as to why the rule stare decisis should not be an absolute rule is that a. no two sets of facts are identical in every respect. Copyright © 2020 Pearson Canada Inc. 2-2

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

b. fairness in law often requires that judges exercise some flexibility in their approaches to some cases. c. precedents only bind the same set of circumstances. d. judges are only bound to follow decisions of higher courts. e. all of the above Answer: e Diff: 2 Type: MC Topic: Common Law: The Theory of Precedent Skill: Recall/Applied 7) In our legal system, the decision of a court of first instance a. can only be overruled by the Supreme Court of Canada. b. can only be overruled by a similar court of first instance. c. can only be overruled by a similar court of first instance and an appeal court. d. can only be overruled by either an appeal court or the Supreme Court of Canada. e. can only be overruled by an appeal court. Answer: d Diff: 2 Type: MC Topic: Common Law: The Theory of Precedent Skill: Applied 8) When it comes to interpreting statutes, a precedent is formed when courts a. decide on the meaning of the language of the statute. b. decide what the language of the statute means; whether it applies to the facts of a case; and, if it does, its consequences. c. determine whether the statute applies to the facts of a case. d. decide on the consequences of the statute when applied to a particular case. e. use and apply an existing case to the case being dealt with. Answer: b Diff: 2 Type: MC Copyright © 2020 Pearson Canada Inc. 2-3

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

Topic: The Sources of Law Skill: Recall 9) Of the two main classes of legislation, a. active legislation gives the government itself the power to carry on a program and to change the law. b. active legislation gives the government itself the power to change the law. c. passive legislation gives the government itself the power to carry on a program. d. active legislation gives the government itself the power to carry on a program and passive legislation allows it to change the law. e. passive legislation gives the government itself the power to carry on a program and to change the law. Answer: d Diff: 2 Type: MC Topic: The Sources of Law Skill: Recall 10) The provincial court system has been established to deal with most matters of private and public law. Trial courts often deal with matters at first instance. The busiest of these civil courts as far as number of cases is a. Superior Court. b. Provincial Court (Civil Division). c. Supreme Court. d. Small Claims Court. e. Surrogate Court (Probate Court). Answer: d Diff: 3 Type: MC Topic: The System of Courts in Canada Skill: Applied

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

11) When we say that in order to institute a lawsuit, a person must first have standing, we mean that a. the person bringing the lawsuit must establish that he or she has the right to bring the lawsuit. b. the person bringing the lawsuit might be someone who has been wronged. c. the person defending the lawsuit must establish that he or she has a good defence to it. d. must be able to stand her or his ground during it. e. the person bringing the lawsuit must explain to the court what his or her lawsuit is about. Answer: a Diff: 2 Type: MC Topic: Procedural Law: Using the Courts Skill: Recall/Applied 12) When two or more parties have a legal dispute, often the cheapest form of resolving the dispute is by a. litigation in the court. b. mediation. c. arbitration. d. an out of court settlement. e. none of the above Answer: d Diff: 2 Type: MC Topic: Procedural Law: Using the Courts Skill: Applied 13) The normal steps in a civil lawsuit in Canadian courts are a. statement of claim, statement of defence, discovery of documents, pre-trial conference, and trial. b. statement of claim, statement of defence with or without counterclaim, oral and documentary examinations for discovery, pre-trial conference, and trial. c. statement of claim, statement of defence, oral and documentary examinations for discovery, and trial. Copyright © 2020 Pearson Canada Inc. 2-5

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

d. statement of claim, statement of defence, pre-trial conference, and trial. e. statement of claim, statement of defence with or without counterclaim, oral examinations for discovery, pre-trial conference, and trial. Answer: c Diff: 2 Type: MC Topic: Procedural Law: Using the Courts Skill: Recall 14) When considering whether or not it is worthwhile to commence an action or lawsuit , a prudent business manager must consider a. the staggering costs of the litigation, even if winning appears to be a certainty. b. that even if winning appears to be a certainty, it may be impossible to collect any money from the defendant. c. that there is always a risk of losing and having to pay the legal costs of the other party. d. that even if winning appears to be a certainty, the litigation may take up a huge amount of the business manager's time, which would be better spent concentrating on the business. e. all of the above Answer: e Diff: 2 Type: MC Topic: Procedural Law: Using the Courts Skill: Applied 15) Which of the following is generally used to resolve an international dispute? a. mediation b. litigation c. settlement d. arbitration e. alternative dispute resolution Answer: d Diff: 2 Type: MC Copyright © 2020 Pearson Canada Inc. 2-6

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

Topic: Alternative Dispute Resolution Skill: Recall

16) There are many reasons why parties to disputes agree not to go to court but rather to arbitration. These reasons include all of the following except a. the hearing will be in private. b. the proceeding will be more prompt. c. the parties can design their own process by selecting the rules. d. the parties will be forced to release the decision to a public reporting service. e. the process will be quicker and more efficient. Answer: d Diff: 2 Type: MC Topic: Alternative Dispute Resolution Skill: Applied

17) Janet recently learned that her credit card company charged her an unauthorized amount of 94 cents on her credit card bill. She reviewed the matter and determined that this charge had been made on a monthly basis for several months. She consulted with a lawyer who told her that in the circumstances the best procedural approach to addressing the problem was for her to a. issue a claim in Small Claims Court for the few dollars that she had been improperly charged. b. commence court proceedings in Superior Court seeking a greater amount for legal costs. c. do nothing given the small amount at stake and the costs of litigation. d. seek to have the action against the credit card company certified as a class action thereby allowing her to represent the entire group of possible class members, i.e. those who likewise were billed an unauthorized amount by the credit card company. e. forget any court proceedings but try to attract media attention. Answer: d Diff: 3

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

Type: MC Topic: Procedural Law: Using the Courts Skill: Applied

18) When a party wins a legal action, the judge will usually award the successful party a. legal aid. b. total costs of the litigation. c. solicitor–client costs. d. party and party costs. e. out-of-pocket expenses only. Answer: d Diff: 1 Type: MC Topic: Procedural Law: Using the Courts Skill: Recall 19) Substantive law a. means the civil law. b. comprises law that applies to rulings of judges. c. means the common law. d. comprises the rights and duties that each person has in society. e. comprises laws that are applied to issues or substantive matters that are identified by lawyers in court. Answer: d Diff: 1 Type: MC Topic: Classifying Law Skill: Recall

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

c. rules that deal with how substantive rights and duties may be enforced. d. a comprehensive legislated code. e. subordinate legislation. Answer: c Diff: 2 Type: MC Topic: Classifying Law Skill: Recall

21) The primary goals of the common law when it was developed were a. efficiency and regularity. b. consistency and predictability. c. efficiency and speed. d. justice and speed. e. justice and regularity. Answer: b Diff: 1 Type: MC Topic: Legal Systems: Civil Law and Common Law Skill: Recall 22) The two main sources of law are a. common law and canon law. b. subordinate legislation and judge-made law. c. judge-made law and statute law. d. judge-made law and canon law. e. judge-made law and equity. Answer: c Diff: 1 Type: MC Topic: The Sources of Law Skill: Recall

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

23) Law created by administrative agencies that are authorized by statute to make laws for certain purposes is called a. subordinate legislation. b. common law. c. law merchant. d. administrative law. e. domestic law. Answer: a Diff: 2 Type: MC Topic: The Sources of Law Skill: Recall 24) Specific performance and contempt of court are examples of a. common law rules. b. rules of the law merchant. c. rules of canon law. d. equitable remedies. e. subordinate legislation. Answer: d Diff: 2 Type: MC Topic: The Sources of Law Skill: Recall 25) Which of the following is NOT/are NOT a Federal Court of Canada? a. Federal Court of Canada b. Federal Family Court c. Supreme Court of Canada d. Tax Court e. all of the above Answer: b Copyright © 2020 Pearson Canada Inc. 2-10

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

Diff: 2 Type: MC Topic: The System of Courts in Canada Skill: Recall 26) Which of the following is NOT one of the tiers of courts in Canada? a. intermediate provincial appeal courts b. Supreme Court of Canada c. circuit courts d. court of first instance e. none of the above Answer: c Diff: 2 Type: MC Topic: The System of Courts in Canada Skill: Recall 27) In class action proceedings, a. legal aid is available to injured plaintiffs. b. the court appoints a lawyer to help injured parties. c. a court usually awards punitive damages against negligent manufacturers. d. separate claims are consolidated for trial. e. a plaintiff applies to court to represent a class of plaintiffs with similar claims. Answer: e Diff: 2 Type: MC Topic: Procedural Law: Using the Courts Skill: Recall 28) Mary owes Jack $15 000 in unpaid bills. Mary and Jack enter into an agreement. Jack is required to pay Mary $20 000 for the delivery of certain products. Jack is unable to pay and Mary sues Jack. Under the circumstances, Jack may also a. file a statement of questions. b. counterclaim for $15 000. Copyright © 2020 Pearson Canada Inc. 2-11

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

c. reserve judgment. d. provide admissible evidence. e. request an examination for discovery. Answer: b Diff: 2 Type: MC Topic: Procedural Law: Using the Courts Skill: Applied 29) Jack decides to sue Mary and consults a lawyer. Because Jack had very little money, the lawyer agrees that his fees will take the form of a percentage of the damages Jake collects if he wins. The lawyer's fee arrangement is a a. contingent fee arrangement. b. flat fee arrangement. c. solicitor–client fee arrangement. d. sliding scale fee arrangement. e. party and party costs. Answer: a Diff: 2 Type: MC Topic: Procedural Law: Using the Courts Skill: Recall 30) The two models of legal aid that are used in Canada are the a. Ontario legal aid and legal clinics. b. community legal clinic and judicare. c. judicare and payment plans. d. payment plans and community clinic. e. free services and community legal services. Answer: b Diff: 2 Type: MC Topic: Procedural Law: Using the Courts

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

Skill: Recall/Applied 31) Mary works at a bread-making factory. All the women workers at the plant are paid lower wages than their male counterparts for the same work. The women workers decide to sue. They decide that Mary should represent all of them in a lawsuit. This kind of lawsuit is known as a. a class action. b. a labour dispute. c. res judicata action. d. a plaintiff claim. e. a representative action. Answer: a Diff: 2 Type: MC Topic: Procedural Law: Using the Courts Skill: Recall/Applied 32) Standing to sue is recognized by a court when a litigant a. pays money into court to the credit of the action he or she has brought. b. enters an appearance by filing a notice of intention to contest an action. c. files an affidavit containing hearsay evidence. d. fails to defend an action. e. has a direct interest in a matter and/or whose rights are specifically affected by another. Answer: e Diff: 3 Type: MC Topic: Procedural Law: Using the Courts Skill: Recall/Applied 33) Substantive law deals with the rights and duties of each person in society, and procedural law deals with the machinery to enforce those rights. a. True Correct: Correct b. False Incorrect: Incorrect Copyright © 2020 Pearson Canada Inc. 2-13

TIF for Smyth: The Law and Business Administrations, Fifteenth Edition Chapter 2: The Machinery of Justice

Answer: a Diff: 1 Type: TF Topic: Who Makes Law? Skill: Recall 34) English common law is based on laws that are codified. a. True Incorrect: Incorrect b. False Correct: Correct Answer: b Diff: 1 Type: TF Topic: Legal Systems: Civil Law and Common Law Skill: Recall 35) In any jurisdiction of Canada, such as Ontario, the rule is that the decision of a higher court is binding on a lower court. a. True Correct: Correct b. False Incorrect: Incorrect Answer: a Diff: 2 Type: TF Topic: The System of Courts in Canada Skill: Recall 36) Administrative agencies derive their authority from regulations passed under statutes. a. True Correct: Correct b. False Incorrect: Incorrect Answer: a Copyright © 2020 Pearson Canada Inc. 2-14