Hospitality Law Chapter 01

Law of Hospitality and Tourism
A Preventive Approach
Chapter 1
Introduction to Contemporary Hospitality Law
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COPYRIGHT © 2008 by Delmar Learning. ALL RIGHTS RESERVED.
What Is Law?
• A body of rules to which people must conform their conduct
• A form of social control
• A set of rules used by judges in deciding disputes
• Common denominator to all definitions:
• Law consists of rules that require people to meet certain standards of
conduct and are enforceable in court
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Principles of Hospitality Law
• Restaurants • Casinos
• Bars • Amusement parks
• Hotels, inns, B & B’s, motels • Theaters
• Travel agents • Night clubs

• Airlines
• Sports facilities
Sources of Law
• Constitutional law
• Delegated powers—expressly allocated to the federal government in the Constitution
• Interstate commerce—business affecting more than one state
• Legislative process—method by which Congress adopts laws
Sources of Law (continued)
• Statutory law
• Law promulgated by legislators and generally agreed to by the executive (president,
governor, or mayor)
• Statute—law adopted by federal or state legislature
• Ordinance—law adopted by local legislature
• Common law
• Consists of legal rules that evolved from decisions of judges and from custom and
practice
• Gradually modified as habits were modified, as new inventions created new wants and
conveniences, and as new methods of doing business developed
• Precedents
• Case decision—interpretation of the law applied by a judge to a set of facts in a given

case
• Precedent—case decision becomes precedent
• Stare decisis—process of following earlier cases gives some uniformity to the law
• To some extent statutes and common law are intertwined
• Sometimes statutes are adopted to modify common law
Administrative Law
• Refers to laws that define powers, limitations, and procedures of
administrative agencies
• Administrative agency—governmental subdivision charged with administering

legislation that applies to a particular industry
• Laws adopted by administrative agencies are called regulations
Administrative Law (continued)
• Food and Drug Administration—oversees food and pharmaceutical

industries
• Federal Communications Commission—oversees the

communications/broadcasting industry
• Consumer Product Safety Commission— polices the safety of consumer

products
Role of the Judge
• Makes the law in cases where no precedent or statute exists
• Interprets the law in cases where a statute applies
• Appellate judges—also review decisions of other judges
Civil and Criminal Law
• Civil law—wrong done to an individual
• Criminal law—wrong considered to be inflicted on society
• Objectives
• Civil lawsuit—compensation for an injury
• Criminal lawsuit—punishment of the wrongdoer
Civil and Criminal Law (continued)
• Civil lawsuit
• Person who commences the lawsuit is the injured person
• Criminal lawsuit
• Person who undertakes the lawsuit is society-at-large, usually referred to
as “The State of …” or “The People of the State of …” or “The
Commonwealth of …”
Examples of Civil Law
• Contract
• An agreement between two or more parties that is enforceable in court
• Torts
• Negligence—breach of a legal duty to act reasonably
• Trademark infringement—use of another company’s
business name or logo without permission
• Fraud—intentionally untruthful statement made to
induce reliance by another person
Remedies in Civil Cases
• Remedy sought by the injured party in a civil case is damages (money)
• Compensatory damages—money given to compensate for injuries
• Includes out-of-pocket expenses
• Medical bills
• Lost wages
• Pain and suffering
• Physical distress or mental anguish
• Loss of enjoyment of life
Remedies in Civil Cases (continued)
• Punitive damages
• Money in excess of compensatory damages
• Punish or make an example of the defendant
• Awarded only in cases where defendant’s wrongful acts are aggravated by violence,
malice, fraud, or a similar egregious wrong
Examples of Crimes
• Theft of services—using services (e.g., hotel room) without paying and with
intent to avoid payment
• Assault—intentionally putting someone in fear of harmful physical

contact
• Battery—causing harmful physical contact to a person
Penalties and Remedies
in Criminal Cases
• Community service
• Fines
• Probation—criminal offenders remain out of jail, supervised by probation officer
• Death in some states
How to Read a Case
• Judges’ written decisions are called cases
• Books in which cases are published are called case books
How to Read a Case (continued)
• Identify four elements as you read the case

• The facts—circumstances that gave rise to the lawsuit
• The issue—legal question that the parties want resolved
• The judge’s decision—judge’s response to the issue
• The reasoning supporting the decision—basis and rationale for the decision

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Law of Hospitality and Tourism

• Bars • Amusement parks

• Hotels, inns, B & B’s, motels • Theaters

• Travel agents • Night clubs

• Interstate commerce—business affecting more than one state

• Legislative process—method by which Congress adopts laws

• Statute—law adopted by federal or state legislature

• Ordinance—law adopted by local legislature

• Case decision—interpretation of the law applied by a judge to a set of facts in a given

• Precedent—case decision becomes precedent

• To some extent statutes and common law are intertwined

• Sometimes statutes are adopted to modify common law

• Administrative agency—governmental subdivision charged with administering

• Laws adopted by administrative agencies are called regulations

• Food and Drug Administration—oversees food and pharmaceutical

• Federal Communications Commission—oversees the

• Consumer Product Safety Commission— polices the safety of consumer

• Interprets the law in cases where a statute applies

• Appellate judges—also review decisions of other judges

• Criminal lawsuit—punishment of the wrongdoer

• Money in excess of compensatory damages

• Punish or make an example of the defendant

• Assault—intentionally putting someone in fear of harmful physical

• Battery—causing harmful physical contact to a person

• Probation—criminal offenders remain out of jail, supervised by probation officer

• Death in some states

• Books in which cases are published are called case books

• Identify four elements as you read the case

• The issue—legal question that the parties want resolved

• The judge’s decision—judge’s response to the issue

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