Business Law and Ethics

This study material covers the topics of business law and ethics. It includes discussions on contract law, court systems, and the Enron Corporation case in relation to ethical corporate governance and the Sabane-Oxley Act, 2002.

Business Law and Ethics

Table of Contents
INTRODUCTION...........................................................................................................................................3
PROJECT 1....................................................................................................................................................3
Describe about contract law by including its blue print..........................................................................3
Discussion on the court system in consideration to the English Legal system. Also, advise the disputed
party that which court is helpful for them...............................................................................................4
Explain the scenario in context of Hilary, whether there was a binding contract between different
parties or not...........................................................................................................................................5
List out the several remedies available for the parties............................................................................6
PROJECT 2....................................................................................................................................................6
Explain the case of Enron Corporation in the aspects of Ethical Corporate Governance and Sabane-
Oxley Act, 2002........................................................................................................................................6
CONCLUSION...............................................................................................................................................9
REFERENCES..............................................................................................................................................10

INTRODUCTION
Legal System of any nation needs to ensure that they are working in the correct manner
for forming the law and policies in the country. At the time of commencing any of the law,
committee need to overview each of the aspects so that chances of performing default by
misinterpretation of law cannot be done by any of the person. Discussing it in detail, government
have also given major importance at the time of commencing or adding new law within the
business law as this law connects with the enhancement of economic level. Not only business
law is to be considered but at the same time, ethics is also important which is to be followed.
The report in this assignment will be categorized into two different parts and they are part
one and part second. The first part is connected with the topic of contract law and how it is
crucial for maintaining the legal relations between two different parties. The other side of the file
will carry the important information related to Enron Corporation where they had done the
scandal at a bigger scale due to number of people has to suffer. But discussion will be done in the
context of ethical corporate governance and Sabane-Oxley Act, 2002.
PROJECT 1
Describe about contract law by including its blue print.
In a person’s life, they need to deal with different people on a daily basis and it is
essential to understand that whenever they deal with them in legal manner then there is higher
probability that effective results can be obtained. The style of performing the work through legal
manner is only possible if they work as per the requirement of Contract Act. For better
understanding, it is explained as the law where person to person, organization to organization
and Person to organization tries to enter in the agreement for performing specific part of
performance through which goals can be accomplished (Sison, Beabout and Ferrero, 2017).
Although, entering into these types of contract is easy but, it needs ensure that requirements are
fulfilled at each of the stage. To form any of the contract, there is a requirement of two parties
where they both should be satisfied with the terms and condition which has been included as a
part of contract. Not only this but there are some of the other importance as well of contract law
which needs to be understand that whereby parties thinks about entering into the contract, they

will not be able to revoke which give surety to involved party that their opposite party will
perform their part of work within the given time period.
The blue print of the contract law includes number of aspects and all of those aspects has
huge importance. Considering the first aspects, it always points out the offer which is given to
offeree. At the time of making any sort of offer, it is necessary that all of the terms and
conditions are to be included so that offeree can take decision that whether entering into the
contract will be beneficial for them or it will be deal of losses. But offeree is interested then they
show the acceptance. The acceptance has the great importance because it will only allow to
understand that how and when contract needs to start and when it should be ended. There are
other requirements as well which needs to be fulfilled under the formation of contract. It is said
that whenever any of the contract needs to be formed, consideration should be there. For
example: A performs the work for B but in return B doesn’t gives any of the benefit to B
(Westrick and Jacob, 2016). This particular situation will not form any of the valid contract.
Then, Legal intention is also important which explains that both of the party are interest in
entering into the contract to perform any of the specific task.
Discussion on the court system in consideration to the English Legal system. Also, advise the
disputed party that which court is helpful for them.
The court in any of the nation helps to provide the justice to the innocent party as they are
the one who perform their part of work as per the requirement of law. The court system is always
based upon the legal system what role of government and House of Lords plays the crucial role.
The one of who breaches the rules and regulations has to always suffer from different types of
penalty. Talking in detail, English Legal System explains that court system is based on two
different procedure and they Criminal Proceedings and civil proceedings. Both of this
proceeding has a huge importance because it solves any of the case in the simplest form without
making any of the problem.
Civil Court Proceeding are not difficult as judges always tries their best to find out the
solution to the problem that has been faced by them. In other words, these types of court do not
impose any of the sentence related penalty until and unless the matter gets complex in nature. On
the basis of complexity of civil cases, there are different types of court for civil procedure such
as county court, magistrate court, court of appeal, high court and supreme court (Rhode, 2018).

Another picture is of Criminal Court proceeding which is among the difficult one as every
single view needs to be analysed for obtaining the result. As per criminal court proceeding, the
defaulter is eligible for the penalty of sentence as well. There are also some of the specialised
court under criminal court proceedings and they are Magistrate court, crown court, court of
appeal and house of lords.
The scenario shows that the dispute between different party is related with each other
where they have not affected any of the third party due to which there is not requirement of
criminal proceedings. Here, with the help of civil proceeding under county court, Hilary and
other involved party can easily sort out the matter (Williams, 2018). This court process is
effective in nature because results are declared in a very short time period and overall expenses is
also low in it. In addition, it is also specialised in dealing within any of the contract disputes.
Explain the scenario in context of Hilary, whether there was a binding contract between different
parties or not.
Number of situations arises between two different people where it seems that they have
formed the contract but it is not necessary that contract has been formed in each of the occasion.
If any of the similar form of situation arises then person has the option to take the help of court to
determine that whether there is contract or not. The same situation has been found with the given
scenario of the case so below, it will be identified that whether agreement between Hilary and
other party exist or not.
Between Hilary and Eleanor: The legal contract doesn’t exist between this party as
every time acceptance was not shown by either of the party where offer and counter offer has
been given to each of other. And in any of the circumstances, just making offer doesn’t form the
contract as each of the elements must be satisfied.
Between Hilary and Amy: No contract guidelines have been met in this condition as
well. Although, acceptance to the contract was seen in the given case scenario, but before it
could have reached to the receiver end, Amy informed Hilary that do not consider the post letter
which she will receive after sometime (Liu, 2016).
Between Hilary and Olivia: Judgement in this respective situation is a difficult task but
at the same time it needs to understand that contract has been formed between the parties. It is

because invitation to offer has been made by Hilary. Then, Olivia was quite interested to grab the
offer under invitation so planned and worked according to the requirement which entitles her to
form a valid contract.
List out the several remedies available for the parties
The first principle of contract law is that contract should not be breached in any of the
circumstances. The number of times, this problem will arise the number of occasion defaulter has
to suffer. Some of the remedies that are available in the case of breach of contract is listed:
 Compensation: The monetary benefits needs to be given which means that any of person
who founds to be defaulter in the case will be liable to pay the compensation. The role of
mediator is played by judges who are well expertise in solving the case (Soltes, 2019).
 Specific Performance: In all of the condition, it will not be possible to pay the damages
in the form of money and this is the situation where court decides to declare order in the
favour of innocent party. Here, defaulter has to suffer because they need to complete the
remaining part of the work for obtaining the result in the case.
PROJECT 2
Explain the case of Enron Corporation in the aspects of Ethical Corporate Governance and
Sabane-Oxley Act, 2002
Case Scenario: The case of Enron Corporation has a connection with the biggest scandal
where it highly affected it is stakeholders, specially investors and employees. Some of the major
problem with the case were related to not following any of the rules and regulations and in
addition to this it was found that false information was shown to the investors which has raise the
problem for the investors of the company (Robertson, Voegtlin and Maak, 2017). The total
scandal was of around $74 billion were company has also used the pension fund of employees.
Later on, company was declared as the bankrupt and their stakeholders have to suffer from huge
losses which has just increased their problem.
Ethical Corporate Governance: The law and rules which is formed by the busines
sector that needs to be followed in ethical manner is known as ethical corporate governance. The
current market situation suggests that this particular law is important because it guides that how
any of the work needs to be done within the premises. In any of the circumstances, it is essential

that company must meet out the terms and condition as it plays the vital role for business in
sustaining in the market. The organization that do not follows the guidelines of the ethical
corporate governance has to suffer from huge problem because they need to face number of
problem due to which goodwill can be directly affected. In addition to this, there are some of the
other problem as well which connects with ethical corporate governance that stakeholders must
not be affected by any of the business decisions. Even there are some of the other points in
ethical corporate governance which plays the vital role such as management are the one who
needs to ensure that all of the business activity is being conducted as per the requirement without
creating any of the problem for the investors or the employees. Only, accurate data or
information should be presented in front of the stakeholders so that they can identify the actual
figure of the organization.
Sabane-Oxley Act, 2002: The law which defines the roles and duty of each of the person
who are the part of a company. There are number of other benefits as well which can be obtained
from the law because chances of making any sort of default or scandal from the side of company
cannot be performed which is the main positive side. There are certain circumstances where
company needs to take certain decision where chances of misrepresentation increases but they
must notify to each of their employees (Francis and et. al., 2018). The idea of commencing
Sabane-Oxley Act, 2002 came from the scandal of Enron Corporation where they took each of
the business decision of own without considering any of the factor. But the enforcement of the
law, forbids the business organization to take any of those decision due to which its stakeholders
has to suffer. In addition, there will not be any of the condition in which auditors can make their
false judgement for effective scandal as on now, auditors will be also responsible for each of the
single mistake which they perform. On the other side, the burden upon Accountant of the
company has increased significantly where they must perform their part of work in accordance to
accounting standards. These standards provide the guidelines to take each of single decision for
any of the accounting department of the company.
Explanation of the case in the aspects of Ethical Corporate Governance.
The case of Enron Corporation and the points and the law of Ethical Corporate
Governance explains that both of the them are in opposite directions as any of the terms and
condition has been not followed within the law which is quite serious offence. The company has

breached each of the terms and condition of the law which explains that in any of the situation,
person who is working in the reputed position in the entity must be able to provide the accurate
information as their statements always carries the huge importance. In the aspects of Enron Case,
the ethical values were not considered because this case has simply explained that false
information were being giving to the stakeholders or investors by making default in accounting
statement as that should not be done in any of the circumstances. If one makes the mistake in the
organization, then support from other members can allow to improve the condition of the
company because it will allow to perform better ethical Corporate Governance rules and
regulations. It was among one of those case which can created the doubt from investors to invest
in any of the commercial sector as they are never aware about the internal position of the
company (Benthall and Goldenfein, 2020). There are number of policies under Ethical Corporate
Governance that has been breached by the management of Enron Corporation as it was found
that final approval to the criminal offence was given by them. Also, there is a rule that
employees must be given the right of pension fund for their retired life but Enron Corporation
was among one of those entity which are not fulfilling any of requirement because they used the
employee pension fund. The amount of pension fund that was used by company was for their
later period of time which is one of the major un ethical activity performed by the management
of Enron Corporations.
Explanation of the case in the aspects of Sabane Oxley Act, 2002..
As per the guidelines of Sabane-Oxley Act, 2002, it is necessary to understand that law
must be followed in any of the circumstances where accurate information must be provided to its
stakeholders. This law has the important area which are always necessary to be followed by any
of the company for accomplishing the goals. It means that any of the company can attain their
target only in that respective condition where they do not try to conduct any of the fraudulent
activity. This law suggests that defaulter in the case were accountants, management, and the
auditors of the company who didn’t all of the work for just their personal benefit. The law of
Sabane-Oxley does not permit this because auditors has to explain each of the defaulted points
where they are unable to understand that whether mentioned information is true or not (Pike and
et. al., 2018). Then, there was found that company tried to present wrong information for raising
the fund from the market which is quite wrong in any of the aspects. There was other default

which came across as per the Sabane-Oxley Act, 2002 such as company has used the fund of
employees which is not permissible in any of the circumstance.
Benefits of Sabane-Oxley Act, 2002
There are number of benefits that can be obtained from the Sabane-Oxley Act, 2002 and
those benefits has been mentioned below:
 It will ensure that auditor of the company perform their part of work as per the
requirement.
 Management will take the responsibility of cross verifying the information mentioned by
the accounting department and the approved by the auditor.
 Chances of Fraud will reduce due to which investor can easily show their faith towards
the entity at the time of investing their capital.
CONCLUSION
The discussion of the file is crucial as it explains that contract law is to be formed in each
of the time while forming the contract. It is important to understand that whenever contract needs
to be formed its blue prints has been followed properly. Contract law covers the wider aspects
under business law which is to be considered in each of the sector. As per the rules and
regulations of Sabane-Oxley Act, 2002 the responsibility upon auditor and the management has
increased significantly which they must follow in any of the circumstances.

REFERENCES
Books & Journals
Sison, A. J. G., Beabout, G. R. and Ferrero, I. eds., 2017. Handbook of virtue ethics in business
and management. New York: Springer.
Westrick, S. J. and Jacob, N., 2016. Disclosure of errors and apology: Law and ethics. The
Journal for Nurse Practitioners, 12(2), pp.120-126.
Rhode, D. L., 2018. International Legal Ethics: The Evolution of a Field. Fordham Int'l LJ, 42,
p.219.
Williams, P., 2018. Ethics and the Professional Coach: Challenges and Best
Practices. Professional Coaching: Principles and Practice.
Liu, Z., 2016. Law and Ethics Protecting Cultural Objects. In The Case for Repatriating China’s
Cultural Objects (pp. 23-54). Springer, Singapore.
Soltes, E., 2019. Accenture's Code of Business Ethics.
Robertson, D. C., Voegtlin, C. and Maak, T., 2017. Business ethics: The promise of
neuroscience. Journal of Business Ethics, 144(4), pp.679-697.
Francis, A. G. and et. al., 2018. Business ethics: a study of Portuguese social representation of
business ethics. International Journal of Business Governance and Ethics, 13(1), pp.85-
106.
Benthall, S. and Goldenfein, J., 2020, June. Data Science and the Decline of Liberal Law and
Ethics. In Ethics of Data Science Conference-Sydney.
Pike, G. and et. al., 2018. Public and police perceptions of policing ethics.