Business law assignment Sample solution

BUSINESS LAW.

Table of Contents
INTRODUCTION...........................................................................................................................3
Section 1...........................................................................................................................................4
TASK 1............................................................................................................................................4
1. Analysing the point ‘Parliament is sovereign’ and sources of UK laws..................................4
2. Explain the role of government in law-making and how statutory and common law is
applied in the justice courts..........................................................................................................5
3. Evaluate the effectiveness of the legal system in terms of recent reforms and developments 6
TASK 2............................................................................................................................................6
1. Using specific examples demonstrate how company, employment and contract law has a
potential impact upon business;...................................................................................................6
2.Advantages and disadvantages of unincorporated and incorporated business with its
difference between in terms of starting process...........................................................................8
3. What are the advantages and disadvantages of company over partnership firm.....................9
Section 2.........................................................................................................................................10
1. Solution of disputes for various case scenario with appropriate case law and legal solution
....................................................................................................................................................10
Case 1.........................................................................................................................................11
CASE 2......................................................................................................................................12
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................17

INTRODUCTION
Business law could be described as the component of legislation that helps to
cope with organisation and trade and act as pillar of civil rights law by which individual
and civil laws could be dealt with. It directs starting, consolidation, liquidation, merger
and managing all kinds of corporates and businesses. It is also mentioned as corporate
law or commercial law. It mainly involves IP law, tax law, negotiable instrument law,
corporate law, contract law etc. It is essential because by Alternate Dispute Resolution
(ADR) approach it enables to resolve the matter as well as other numerous company
issues by manner of fair compensation (Bishara and Westermann‐Behaylo, 2012).
This law's primary aim was just to set norms, to keep instructions, to resolve
conflicts and also to preserve the freedoms of each person. At least each person should
have some understanding about mercantile law to make any suitable company choices.
Sales of Goods Act, Partnership Act, Companies Act, Contract law and other
commercial regulations etc., are indeed the central areas of commercial or business
law. Each such law is obtained from specific sources, and perhaps even business law is
inferred from several sources in much the same manner. Several agreements, various
common legal practices, administrative regulations, constitutional law and statute law
are the chief sources. The laws governing commercial or business law also constitute
legal commitments placed on each person and implemented by the relevant chief body
of state. It enhances the strength to make choices without infringing any government-
framed laws, and if anyone fails to obey the legal requirements, they might be enforced
with distinct punishments that might even encompasses imprisonment.
According to the criteria, this study will assist clear various doubts about all
legislation that are established in United Kingdom. Who has the ultimate authority to
decide what law should or shouldn't be enacted. Why are the "Parliament Sovereigns"
throughout the United Kingdom and it will attempt to find out real sources of UK's law.
There will also exhibits aspects of statutory and common rules and how it would be
adhered in the court of law and how different laws will affect any business entity.
In the second unit, study will focus on kinds and company formation with
highlighting the significant advantages and disadvantages of established and non-
incorporated organization. Various case laws are resolved with examples of comparable

case legislation that have already been explored in Companies House by assistance of
Alternate Dispute Resolution to provide reasonable recommendations.
Section 1
TASK 1
1. Analysing the point ‘Parliament is sovereign’ and sources of UK laws.
' Parliament is sovereign ' denotes that all liberties, governance rights and
authorities are entrusted to a single entity where involvement by any legal entity,
including Supreme court, is often not permitted. For a while until law is enacted by
House of Lords, it is legally binding and nobody has the reason for pointing out about
that particular rules or regulations are unlawful. Queen's Speech during month of
November and October, at occasion of beginning session in parliament has significant
place as almost all of the regulatory bodies and government entities announce their
specific programs at end of such speech. Parliament holds overriding power upon any
law as on specific date (Burley, 2017). In UK, generally laws are being formed upon
consideration or consent of major 4 countries: England, North Ireland, Scotland and
Wales. Following are the significant sources or origin of UK's law structure, as follows:
 Common Law: In this, judges draws judgements on the grounds of constitutional
precedents, which implies that when a specific case law has problems and
details comparable to preceding case, then such preceding case is foundation
for present case to pass judgement. It is not required to create a fresh law in
which there are two similar circumstances in two instances. It is also called
jurisprudence or common law. If, a case's judgement emerges a fresh law, then it
will be regarded in lower court's decisions.
 Legislation: The law-making mechanism with the support of various superior
parliamentary representative officials. The permission of the British parliament in
London is mandatory for getting passed of any laws. Only post-authorization by
House of Lords and House of Commons, in which House of Common involves
approx 650 officials whereas House of Lords comprises of approx 800
representatives will law be compelled in legislation. This is one of the law's main
sources.

2. Explain the role of government in law-making and how statutory and common
law is applied in the justice courts
Parliament performs the required part in the development of every law in United
Kingdom since it is said to be the upper representative body with the authority to take
most significant choices. Both houses, House of Lords and House of Common, while
executing any statute or laws, performs the valuable role. House of Common is
responsible to begin preparing a bill whilst also passing distinct guidelines and
regulations as a replacement of such rule. MPs in House of Common proposes a draft,
which will be ultimately submitted to Parliament such draft is regarded as Bill (Grace
and Cohen, 2013).
If at least once such bill is being submitted there, it will go into a discussion
phase for first reading to know whether such bill is eligible for transmitting in second
reading. Thereafter final discussion round take place in which all MPs votes in or
against bill. After it round third starts called: Committee stage, in which a complete
detailed scrutiny conducted in order to assess context and application of such proposed
bill along with any merits or demerits. It also favour any relevant amendment if required.
After it finally bill is being circulated to reporting stage. There also voting is conducted
to asses what is exact no. of votes are caste in against and favour.
When the outcomes are discovered in a favourable situation it's sent to House of
Lords at which requisite modifications are made, then it will be sent back for the last
evaluation to House of Commons. Afterwards, the assent of the knighted head is made
to make law with regards to Royal Ascent Act 1961. Under Justice or judicial Court,
Common and Statute law retrieves specific guidelines and rules to form effective
decision because statute laws are initially passed through parliament, and these are
needed to be follow by individuals. Whereas common law assist in taking vital
judgements on the basis of already ruled judgements (Hanrahan, Ramsay and
Stapledon, 2013). Thus, the roles of government are classified into three major parts, as
discussed below:
 Executive role: This role or set of functions is linked to the development of
policies that will apply across the UK. This function is essential for the

maintenance of good governance, is really the compliance of legal regulations. It
includes Queen, then Prime minster, and then other cabinet members.
 Legislative role: Various regulations are implemented in this position which
have been submitted in the sort of a parliamentary bill. House of Commons and
House of Lords are both responsible for presenting a bill to be set up in order to
regulate the people's rights residing in the United Kingdom.
 Judiciary role: Under it government's role is to evaluate the workings of
established jurisdictions and courts comes under different territory and their
judgement passing efficiencies. Outcomes retrieved through it provide assistance
in establishing new courts and assess need of new courts to avoid delay in
cases. Government's officials as already discussed above falls under such panel.
3. Evaluate the effectiveness of the legal system in terms of recent reforms and
developments
The UK legal structure has undergone numerous changes, but it is yet possible
to perceive the loop holes. Advancement in this system with the other nations is still not
up to standards. Due to its diversity and complexity, the current system seems to be
difficult to comprehend, as there are three distinct major components of the legislative
structure throughout the United Kingdom, making it difficult to establish co-ordinations in
different laws and legal regulations (Hawkins, 2012). It was not upgraded to render it
outdated. This produces a lack of adequate implementation of the legislation and
regulations. Therefore, it could be said that substantial modifications are needed to
improve the efficiency of legal structure.
TASK 2
1. Using specific examples demonstrate how company, employment and contract
law has a potential impact upon business;
There are distinct kinds of company creation, but it has chosen on the magnitude
and essence of the company that an investor is prepared to spend in what sort of
company incorporated or formed. Different companies have varying characteristics
where distinct characteristics are mentioned in law that must be executed. Some of the
training is listed below:

Sole Proprietorship: That's the least intrusive sort of business which combines
different advantages. Here no major legal documentation for formation of proprietary
firm is required. Liability is limited to the extent of amount invested in business.
Partnership: These kinds of enterprises are carried out by two or more
individuals / organizations. Liability in such business format is not restricted to the
assets or funds invested. Appropriate or legal paperwork should be undertaken before
beginning any association type so finding the input quantity will be simple (Hazard,
Hodes and Jarvis, 2014).
Limited Partnership: It is most likely as partnership entity however core
difference here is extent of liability. In it liability is limited to the extent of capital
employed by each partner.
Joint Venture: Two or more individuals or business enterprise in the joint
venture combine to finish a specific project, however such agreed parties can proceed
to operate for shorter periods if appropriate contracts are made.
Limited Liability Company: Various tax-related advantages are given in this
type of company and many more. Investor intends to begin this company because their
resources are not engaged. These businesses have a composite character where it is
possible to find a mixture of collaboration and different company.
UK's authorities and governing bodies has enforced various short of laws to
establish their control over and regulate business entities. These following are key
legislations which may impact businesses are as follows:
 Company law: This law emphasises on tacking and governing the acts of
different corporates. In UK, Companies act, 2006 is applicable for all corporate
entities. It combines all the laws and regulations formed for controlling the entire
processes and acts of companies. It mainly regulates the functions of company
and addresses the grievances of shareholders. It also contains rules regarding
any oppression and mismanagement in companies. It provides guidelines to
corporates belongs to different sectors and engaged in providing different
services.
 Employment law: Human resources for most required resources so their rights
should always be safeguarded. In order to preserve their liberties and rights,

compliance of multiple legislation implemented, is necessary. An employee
normally comfortable in working with an entity or corporate complying with
legislations. Laws which are applicatory on business entity comprises Equality
Act, 2010, Employment Act, 2002 and other regulations time to time issued for
health and safety of employees. Ignorance of such legislations can leads to high
employee turnover (Kaplan, Weisberg and Binder, 2014).
2.Advantages and disadvantages of unincorporated and incorporated business
with its difference between in terms of starting process
Incorporate Associations: This sort of company has its legitimate presence
where it would be effortless to gain entry into any kind of agreement. As it is stable and
secure, the rates of money financing increase relative to unincorporated company. The
various kinds of pros and cons of the company are:
Advantages:
 Perpetual succession's right is available.
 Having eligibility to sue and being sued.
Disadvantages:
 Dissolution process is very complex.
 Incorporation of it require more documentation so it seems bulky and expensive.
Unincorporated Association: With less document job, these kinds of company,
operations are conducted to gain profit. Tax is often not given in the title of the
organization because in the hands of law there really is no physical existence. It really is
hard to manage additional funds in the coming years if necessary (Mann and Roberts,
2012). Following are the key pros and cons are discussed below:
Advantages:
 No statuary requirement in respect of filing process of company's annual
accounts.
 Compliances and costs of legal formalities are very less.
Disadvantages:
 Since it does not has any legal existence so it could not be easily caught up by
terms of voluntary procedure of Insolvency Act.

 If any agreement is concluded on behalf of the organization, it will be proclaimed
void or null.
Key difference between Unincorporated association and Incorporate association are, as
follows:
Incorporated Association
 Business's name is determined with registered or attested address.
 Shareholders and directors at the time of incorporation are mostly regarded as
same person.
 Requirement of preparation of 'Memorandum of Association' contains all
necessary details.
 'Article of Association' is formed with consent of all shareholder at AGM.
 Requirement of forwarding SIC (Standard Industrial Classification) to Companies
House (McMillan, 2012).
 The key source for raising or issuing funds consists of bank loans, bonds, shares
and debenture.
Unincorporated Association
 Core Objectives at the time of formation required to be determined.
 One or more partners leads to requirement of specific agreements.
 Since liabilities are not limited so members or associates required to fix
contribution amount.
 Major source of raising funds this business consists funds invested by Investors,
bank loans and personal assets of members (Murray, 2014).
3. What are the advantages and disadvantages of company over partnership firm
Following are major advantages and disadvantages of company over partnership
firm, as points out here:
Advantages:
 Company holds perpetual succession's right whereas a partnership firm can be
dissolved easily if parter die or left the firm.
 No complexity in raising funds in case of a partnership firm.
 In company liability of shareholders are limited to the extent of securities held by
them but in partnership firm liability is unlimited.

Disadvantages:
 Company's incorporation requires so much legal formalities but partnership firm
can be easily formed with normal registration.
 Dissolution procedures of company is very typical whereas in partnership firm
dissolution is if all debts are properly settled (Nichols, 2012).
 A Company require expensive managerial structure as compare to partnership
firm.
Section 2
1. Solution of disputes for various case scenario with appropriate case law and
legal solution
The case mentioned in the scenario is regarding how the infrastructural company
offered money to Champion Ltd for shifting its business at a new location. It also
includes the difficulties faced by Champion Ltd after changing its business location. For
this purpose, the company took bank loans from financial institutions (Norris, 2016). The
case also considers a dispute regarding late payment by creditors so in order to receive
the due amount faster, it threatens them by filing a petition against them.
Winding up: It refers to a stage where the assets of a company are sold in order
to pay the amount due from creditors. After paying off the dues, a practice is followed
within companies where the remaining amount is distributed among the shareholders
according to their investment in shares of the firm. This can be used by different
organisations ranging from private to public entities. Some of the ways to wound up a
firm are mentioned below:
 Winding up by the order of Court: It is a procedure which applies when a
company fails to perform tasks or pay the due amounts on time. In order to wind
up a firm through court proceedings, the company should justify that it is out of
funds and will not be able to clear any debts (Raz, 2017). After confirmation, the
court passes a judgement where the creditor can recover the due by selling off
the firm's valuable assets which is known as compulsory winding up. For winding
up through court, creditors role increases where they must convene the judge
that company will not be able to clear its debts and the only the way through

which they can recover their money is winding up where they can collect their
money by selling companies asset. It is also known as compulsory winding up
(Schmidt, 2018). The requirements for compulsory winding up are listed below:
◦ In order to wind up with the court order, it is necessary for the company to
have a debt of £750 or more to proceed on the next stage (Winding up by the
order of court, 2018.)
◦ The core duty of lenders and creditors is filing a court petition.
◦ Thereafter it is creditor's and company's duty to provide evidences in court
that company is not in position to pay its debts.
◦ Court appoints a Liquidator who's duty is to asses total asset's value and sell
them within reasonable time.
 Voluntary winding up: In this process of winding up, here share holders have
been informed by a corporation's executives that this year company won't be
willing to settle their creditors so it would be easier to close down the business.
Even this method takes place when the firm is proclaimed insolvent (Schmidt,
2018). Under voluntary winding up, following is process required to be followed:
◦ General meeting is being organised by company's all shareholders, in which
directors circulates entire information in order to pass Special Resolution (¾
of total shareholders), in case Special Resolution is not passed then such
winding up process not be processed.
◦ In case resolution is being passed, A liquidator is appointed to sell all the
assets and pay liabilities utilising collected funds.
◦ Company require to publish such details of winding up in newspaper and company's
official website.
Case 1
Related Case Law: Ebrahimi v Westbourne Galleries Ltd
Facts: In respective case law, Mr Nazar and Mr Ebrahimi were company's
shareholders. They transferred their holing share to Mr. Nazar's son. After that Mr.
Nazar and his son decided to withdraw the holding of Mr. Ebrahimi from company so
they filed a petition for company's winding up.

Judgement: In respective case, House of Lords determined that such type of cases will
not be entertained by court because Mr. Ebrahimi regarded as company's quasi partner
so court has ordered that such company would be wounded up but Ebrahimi will get his
capital with interest (Sharfman, 2014).
Champion Ltd require to make discussion with company's lenders and creditors
about that such winding up would not be effective solutions thus they require to consider
an alternate which will be beneficial for both and also company will be saved from
liquidation process. Following are major ways to resolve such dispute related to
creditors and company, as follows:
 Champion Ltd should not disregard debts ' request, but that both parties can
compete on each hand so that disputes can be resolved.(Stout and Blair, 2017)
 In terms of compensation, even companies can check with their shareholders as
to how soon it can require to buy them home or even apply for extra time.
This feasible route can assist both businesses and customers as the winding-up
method is long and even costly where distinct formalities have to be achieved. If this
does not operate for customers then the business should try to wind up voluntarily as
this method will not eat munch and more money and this will assist the business to
settle their debts as quickly as feasible.
CASE 2
In the second situation, the breach of the agreement is contested. Mr. Anderson,
who works as Chief Financial Officer of the business in Amber Ltd in which both parties
entered into a agreement that 12 months previous notification should also be provided
due to resignation and if the business wishes to reject it must adopt that as well. Mr
Anderson quit the business without notification and would like to enter Beta Corp. as
CEO who had been a hard Amber Ltd rival. In conditions of business, the factors
provided by Mr. Anderson have not been suitable. Afterwards, the need of company is
to announce Mr.Anderson is insolvent and wishes to seek damages resulting from
contract breach.
Contract: It can be described as enforceable legal contracts. Contract enables
with all sorts of company transactions as it is legally binding. It is clear that one time if
parties get into contract it is illegal to leave or breach the contract and in case if any part

does then they have to bear plenty (Twomey, 2012). For a legitimate agreement there
must be regard, give and recognition, legal intent, shared consent, agreement is
essential because when relationships fail. It is observed that most contracts consider
written form because is assist to turn out definite guidelines that are established at the
time of getting into contract.
Breach of Contract: It is the procedure in which agreed or united party error
themselves in order to perform agreed duties. Violation of the agreement is a personal
mistake and if a individual is discovered guilty of violation of the agreement then distinct
penalties may apply. When agreement has been made, it shouldn't modify and when
that appears, it won't fit into the classification of contract breach. If any entity wishes to
be infringing the agreement then the judge should invite requests on related subjects
such as:
 Whether there is still a agreement?
 Had any of the parties changed the agreement?
 What are the injuries incurred by agreement infringement?
Insolvency: It is the circumstance in which debtors can not settle their bills on
moment. This is primarily owing to capital loss, lower income and creditor failure, or in
easy phrases it could be said that if total obligations surpass complete wealth . If an
individual or organization is proclaimed insolvent, different legal restrictions will be
enforced.
Related Case Law: Andrew v Jones
Facts: In this scenario, Jones and Andrew made and agreed that Jones should
conduct his assignment given by Andrew and in exchange Andrew would offer him £
800 but Andrew did not pay him the complete quantity after finishing the task. So Jones
chose to lodge a petition on this issue in trial.
Judgement: In context to this particular case, House of lords declared that
Andrew is the one party in guilt because he have breached the contract therefore he is
liable to pay the entire amount to Jones. Furthermore while conducting legal custody
Jones have spend lots of amount which would be also given by Andrew.
They must follow the rules of Alternate Dispute Resolution (ADR) to resolve the
complaint between Mr. Anderson and Amber Ltd.

Alternate Dispute Resolution (ADR): It can be defined as the procedure which is used
in law for the purpose of resolving different types of disputes that are taking place between two
or more parties. Main objective of it is to resolve the conflicts out side the court without any
legal proceeding. In this process third party who is responsible for the resolution of the dispute
plays an essential role. With the help of it burden of court could be reduced and it is a less
complex and low time taking process which helps people to get justice. It was firstly introduced
in US and afterwards all the other countries started to adopt it as it is considered as the most
easiest way to deal with conflicts of two or more parties (Yosifon, 2013). There are three
different types of ADR which could be used by the third party to deal with the conflict of two the
parties which are involved in disputes. All of them are described below briefly:
 Mediation: In this type of ADR a third party is appointed to resolve the dispute. In this
ADR two parties which are having conflicts meet at a new location and mediator talk to
both of them and resolve the dispute.
 Conciliation: This type of ADR is used for the purpose of establishing a positive
environment among the parties involved in dispute. In this ADR a conciliator is
nominated who try to provide an agreement to both the parties to satisfy them.
 Arbitration: In order to deal with massively complicated cases this mode of ADR is
used. In this ADR third party is appointed who is known as arbitrator and provide binded
decision (Zimmermann, 2012).
By analysing all the above described ADR it has been recommended to Amber Ltd and
Mr. Anderson to gr for conciliation ADR as it has been identified that their case is not that much
complicated where a arbitrator is required.

CONCLUSION
From above discussed study it has been founded that each rules set and
relevant regulations should be complied. In UK's law structure all the top judging or
supreme authorities are under the governance of parliament thus it implies that no one
has overriding power over Parliament's decisions. Rules, legal policies and other
regulations are generally framed prohibit any unethical and illegal conduct. Discussed
content on business law assist in dealing with different state of affairs concerned with
different laws such as taxation law, contract law, company law, sales of goods law,
intellectual property rights and other laws. Judicial entities always requires extreme
support and help of statute determined laws and other general laws in context of UK's
law structure as both impacts judicial judgemental processes directly or indirectly.
There are numerous parts are added in multiple legislation each year that are
modified as per the requirements of routine or common operations. Everyone should
have the comprehension of corporate or business legislation that includes distinct laws
to cope with distinct parts of the legislation. There are various points mentioned in this
study about why and what extent corporate, labour law and contract law demonstrate its
effect on corporate organization. The debate of creation and culture has always helped
to discover the position of corporates as they are benefited by different rules.
On the basis of second section, it is analysed that it's always essential to pursue
regulations/laws and that all corporation should know about what business priorities are
out there. And also which region is best suited for enterprise as mentioned in the
situation of Champion Ltd, in which the firm encountered several problems after
changing its place. The various situation regulations have helped obtain the
understanding about the breaking up method and it's never essential to liquidate
business if alternatives or other solutions are feasible. In second case study, it was
mentioned that even if a organization or person concludes a agreement, they must
understand what the communication is really all about as nobody has obligation or right
to break the rules mentioned in the agreement since it ultimately leads to an offense.
Alternative Dispute Resolution or ADR also enables to resolve multiple problems within
short intervals where there is no need to go to jury. In all this, by offering adequate

advised or recommendation, third person enables both parties concerned to resolve
disputes.

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Online
Business Law and Legal Definition. 2018. [Online]. Available
through:<https://definitions.uslegal.com/b/business/>.