Using Contract Negotiation Exercises to Develop Higher Order Thinking and Strategic Business Skills

• Published date: 01 September 2013
• Date: 01 September 2013
• Author: Dale B. Thompson,Susan J. Marsnik
• DOI: http://doi.org/10.1111/jlse.12001

Journal of Legal Studies Education

Volume 30, Issue 2, 201–248, Summer 2013

Using Contract Negotiation Exercises

to Develop Higher Order Thinking

and Strategic Business Skills

Susan J. Marsnik∗and Dale B. Thompson∗∗

I. Introduction

This article presents two contract negotiation projects for use in Legal En-

vironment of Business courses. Realistic simulations, such as these experi-

ential exercises designed to provide a context for learning, are examples of

problem-based learning (PBL). PBL has been characterized as “one of most

important developments in contemporary higher education.”1By requiring

students to solve problems of the kind they will encounter in the real world,

problem-based exercises increase the probability that students will be able

to use what they have learned after they graduate.2Participating in these

contract simulations requires students to master content in a way that al-

ters their perception of the legal environment while developing skills they

will need as citizens and businesspeople. By f‌irst negotiating a contract and

then putting the agreement in writing that they understand, students learn

that the real power of contract law is dynamic: it is a way to memorialize

∗Associate Professor, Department of Ethics & Business Law, Opus College of Business, University

of St. Thomas

∗∗Associate Professor, Department of Ethics & Business Law, Opus College of Business, Univer-

sity of St. Thomas. The authors would like to thank participants of the 2012 Midwest Academy

of Legal Studies in Business Conference, the 2012 Academy of Legal Studies in Business Confer-

ence, along with Susan Callaway, Susan, K. Snyder, and the anonymous referees for their helpful

comments and suggestions. We would also like to thank our undergraduate students who have

participated in contract negotiation exercises as a regular part of their education over the last

decade. They have been our teachers in honing and revising these exercises. This research has

been supported by grants from the Opus College of Business, University of St. Thomas.

1Marilla Svinicki & Wilbert J. McKeachie, McKeachie’s Teaching Tips: Strategies, Re-

search, and Theory for College and University Teachers 208 (13th ed. 2011).

2Id. at 203.

C2013 The Authors

Journal of Legal Studies Education C2013 Academy of Legal Studies in Business

201

202 Vol. 30 / The Journal of Legal Studies Education

the relationship they have agreed upon. Moreover, their experiences help

them progress beyond memorization of legal terms and black letter law by

providing them with the opportunity to analyze these concepts and to apply

them in meaningful ways. Students both acquire and hone critical thinking

skills in a manner that allows them to take those skills beyond the classroom

experience. Furthermore, through the process of negotiating and drafting

their contract, students acquire important business skills such as identifying

and acquiring relevant information, developing strategies to manage risk,

and learning to spot and capitalize on the benef‌its from collaboration and

cooperation.

The authors have used contract negotiation and drafting exercises in

their introductory courses for over a decade. We offer two examples of suc-

cessful contract negotiation projects. The f‌irst is designed as a two-person

negotiation focusing on the Uniform Commercial Code (UCC) and the sec-

ond as a team-based negotiation based on the Convention on Contracts for

the International Sale of Goods (CISG).3We begin by providing a brief in-

troduction to experiential exercises and problem-based learning that has

informed the development of these exercises and then examine some of the

general business lessons that derive from the use of contract negotiation exer-

cises. We then offer our two exercises as examples. The projects demonstrate

for students in a concrete way that law can be used as a tool for managing

information and risk, while enabling the creation of mutual benef‌it. The ex-

ercises can be readily adapted to emphasize other legal concepts, according

to instructional needs.

II. Problem-Based Learning

Students who graduate with business or professional degrees face problems

in their careers for which there are no clear-cut or well-def‌ined solutions. As a

result, higher education should do more than transfer content knowledge. It

should go further to develop higher order competencies. Over half a century

3At our institution, core business law courses require junior standing. The UCC exercise is de-

signed for a Legal Environment of Business course and the CISG exercise for an International

Business Law course. Both are introductory courses, and most business majors may choose be-

tween the two courses to fulf‌ill their core business law requirements. Because of the complexities

of trade f‌inance, risk of loss, and other international issues, the international business law case

is easily adaptable to a second or advanced course in international business law.

2013 / Using Contract Negotiation Exercises 203

ago, Benjamin Bloom analyzed and ranked classes of learning.4In ascending

order of diff‌iculty and importance, Bloom’s Taxonomy includes (1) knowl-

edge, (2) comprehension, (3) application, (4) analysis, (5) synthesis, and

(6) evaluation.5To address the issue of providing students with the requisite

skills to solve real-world problems and to move them up the taxonomy, over

the last three decades, PBL approaches and curricula have been developed

and used in professional schools.6The primary goal of PBL is to prepare

students to be self-directed, lifelong learners, and practical problem solvers.7

What makes skills-based exercises so important is that they move students be-

yond knowledge and comprehension of content to higher forms of learning.

These methods cast students in the role of active participants who must make

decisions, solve problems, and react to results.8In addition, content learned

through a realistic exercise is more likely to be learned at a deeper level and

remembered and used appropriately when it is needed later.9

There is little doubt our colleagues in the academy recognize the

value of teaching business and legal principles through contract drafting or

4See generally Taxonomy of Educational Objectives, The Classif‌ication of Educational

Goals: book I: Cognitive Domain 18–20 (Benjamin S. Bloom et al. eds., 1956).

5Id. at 18. The six stages of Bloom’s taxonomy have been revised to (1) remember, (2) un-

derstand, (3) apply, (4) analyze, (5) evaluate, and (6) create. A taxonomy for Learning,

Teaching, and Assessing: A Revision of Bloom’s Taxonomy of Educational Objectives

4–5 (Lorin W. Anderson et al. eds., 2001). Although the categories have changed, the basic

principle of moving from content based knowledge to higher levels of cognition remains the

same.

6PBL has been implemented in nursing, medical, engineering, and business schools. Howard

S. Barrows, Problem-Based Learning in Medicine and Beyond: A Brief Overview, in Bringing Problem-

Based Learning to Higher Education: Theory & Practice, in Bringing Problem-Based Learning

to Higher Education 3,10 (LuAnn Wilkerson & Wim H. Gijsdlaers eds., 1996)[hereinafter

PBL/Higher Education]. The traditional law school case method approach is not a PBL

strategy; however, law schools have also begun implementing PBL exercises into traditional

courses. See Myron Moskovitz, Beyond the Case Method: It’s Time to Teachwith Problems, 42 J. Legal

Educ. 241 (1992). See also Fiona Martin, Using a Modif‌ied Problem Based Learning Approach to

Motivate and Enhance Student Learning of Taxation Law, 37 Law Teacher: The Int’l. J. of Leg.

Educ. 55 (2003).

7Woei Hung, Jessica Harpole Bailey & David H. Jonassen, Exploring the Tensions of Problem-Based

Learning: Insights from Research, in Problem Based Learning in the Information AGE (Dave

S. Knowlton & David C. Sharp eds., 2003) [hereinafter PBL/Information Age].

8Svjnicki & McKeachie,supra note 1, at 181.

9Id. See also Stephen D. Brookf‌ield, The Skillful Teacher 116 (1990) (Information learned

in this way is “etched much more f‌irmly into people’s perceptual f‌ilters and structures of

understanding.”).