Different Sources of Law and Role of Government in Law Making Process

This report discusses various sources of law, government's role in law making, impact of law on businesses, different type of businesses, etc.

Table of Content
INTRODUCTION...........................................................................................................................1
LO1..................................................................................................................................................1
P1: Different Sources of Law......................................................................................................1
P2 Role of Government in Law Making Process.........................................................................3
LO 2.................................................................................................................................................4
P3. Potential Impact of Employment and Contract Law on Businesses......................................4
LO 3.................................................................................................................................................6
P4 Different Types of Business Organizations...........................................................................6
P5, Managing and Funding of Business Organization.................................................................9
LO 4...............................................................................................................................................10
P6. Legal Solutions to Resolve Disputes ..................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business law is basically an area of legal practices. Government of the United Kingdom
only has the authority to make this law. Government already imposes many regulations,
standards, and legislation on businesses under business law. Maintain legal environment within
UK's businesses is the main objective behind business law. All businesses in this country are
responsible to follow all law during their business operations. English business law includes
various act which every company need to employ in their workplace. Otherwise, company which
not employed this act, will face issues like; penalty, fine and court hearing. In this case, each
company need to follow this law. Business law generally promotes ethical environment within
businesses. This report discusses various sources of law, government's role in law making,
impact of law on businesses, different type of businesses, etc. A specific legal recommendation
also provided in this report to each case study. Specially, impact of contract law, company law
and employment mentioned in this report. These all law highly impact businesses, because each
business compulsorily needs to follow these laws.
LO1
P1: Different Sources of Law
There are Legislation, European union, ECHR and Common law four main sources of
business law in the United Kingdom. ECHR refers to European Convention on Human rights.
These all sources of law has been explained below;
Legislation
Legislation law mainly creates by the legislature. Acts of parliament is the most useful
legislation piece. UK's parliament is the principal legislature in this country. Parliament has only
power to pass any law (Lyons, 2018). In this case, this created many laws for the existing
businesses. Government of this country has passes law almost for all area, like; businesses,
industries, tourism, food & beverages, sports, hospitality etc.
European Union Law
The United Kingdom is a major member of the European union, so businesses need to
follow those laws also which passes by EU (European union).
ECHR (European Convention on Human Rights)
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This country member of European council as well. In this case, UK's businesses are
responsible to follow the Act of Human Rights, 1998 too which passes by the ECHR.
Common Law
Common law are basically those laws which the local government passes to build legal
environment within country. Businesses which run their operations in the England and Wales are
specially needed to follow these laws. Most businesses in the UK mainly follow law which
comes under common law. Common law have included various standards, regulations and
terminologies which work for maintaining ethical environment within country. English law also
comes under common law which described below;
English Business Law
English business law is a summarized version of Merchant law, Contract law, Legislature
statute, Legislative or Statutory acts and Agreements, conventions & commercial treaties.
Merchant Law: Merchant law of the United Kingdom first legally introduced in 14th century.
From introduce to date still, the local government make changes in merchant law when it
necessary (Foster, 2018). This law is basically a set of regulations and standards which each
business can maintain in their daily operations. Merchant law give a specific direction to
companies for how to run business activities in legal manner.
Contract Law: Contract law is too necessary law to companies, because all companies need
sign different deal papers on daily basis. In this case, contract law is source of legal paper which
helpful to the businesses to remove many conflicts within their daily activities. With the support
of contract law a business enables to avoid various contract litigation and disputes.
Legislature Statute: Law which based on legislature statute are commonly enacted by the UK's
parliament. This is very poplar source of law which provides different laws for different areas.
This is basically a top authority in this country which creates law.
Legislative or Statutory Acts: Law which passed by parliament, legislature and competent
authority in the UK is known as statutory act. Currently many acts applied on businesses within
this country. There are acts generally work for describing various existing law.
Agreements, Conventions & Commercial treaties: This is the main part of business law for
the businesses which each business needs to be considered during its operations (Hervey, 2018).
The main reason behind last statement is, agreements, conventions & commercial treaties are
providing those all legal terminologies to the businesses which useful in their daily operations.
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For example; without agreements a business can't deal with its supplier, employees, finding
sources, and investors etc. Agreement provide facility to the businesses to run their operations
without any error.
P2 Role of Government in Law Making Process
Government is the legal body which provides base for new laws which are formulated in
the parliament in the country. Government is responsible to understand interest of citizens in
making a law which protect them and also provide them with rights to increase their productivity
in legal framework (Kochupillai and Brinkmann , 2019). Any law is presented in the form of bill
in the parliament where all the members gives there thoughts about the nature of the bill before
accepting or rejecting it. Every member has the right to make their decisions without any
pressure and in free consent. All the member of parliament are elected member and governs a
particular constituency effectively. It is different in all the countries depending on the legal
structure which helps to make the laws more effective to help its citizens. Apart from parliament
there are many legal department which helps t delver the laws and take the action to make the
law a success in the country and increase the efficiency of the country to protect their people
effectively. The law making process is divided in five stages which provide effective solutions to
the issues of citizens and provide them better quality of living of standards. As government are
also responsible to monitor the amended laws and policies to make it more effective and increase
the efficiency to provide benefit to citizen. Government only works to support its citizens and
helps to understand their issues and problems.
UK's government is the people which is responsible to run the country and all the
political parties which support those peoples make the government. UK has five-year tenure of
any government to make social welfare and increase provide maximum development in the
country. The leading parties have the right to choose cabinet ministers and junior minsters which
help to run the government effectively. Parliament is very essential legal body which helps
government to make effective laws as government cannot draft any law without permission of
members of parliament. Parliament of UK consists of house of commons and the house of lords.
House of common has the members which are elected by the citizens for five-year tenure. House
of lords include members which are elected as members for lifetime, kings, church popes which
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great knowledge and wisdom to understand all the issues are part of house of lords. The law is
formulated various stages in UK government.
 First reading- In this stage bill is presented in the parliaments in front of both the houses.
There is a formality in this stage where the name and nature of bill is announced in the
parliament.
 Second Reading- In this stage debate on key polices of the bill is conducted and members
discuss all the issues and problems with the bill (García-Álvarez, Pineiro-Villaverde and
Varela-Candamio, 2018). This stage provides suggestion for the change in the bill to
make it more effective and increase its potential.
 Committee Stage- In this stage there is a very detailed text study of the bill from start to
end to suggest changes in the bill and voting is conducted to know that changes should be
done in the bill or not.
 Report Stage- Report stage is the second opportunity to further understand the bill in
detail and make voting to make changes in the bill effectively.
 Third reading- This stage is called tidying up stage in which the bill is considered and all
the loopholes are sealed by making effective changes with the helps of votes in both the
houses.
 Consideration– In this stage if any all the changes made by house of lords need an
approval from house of commons and if house of common does any changes than it need
to be approved by house of lords this takes a long process and also known as ping pong
stage.
 Royal Assent- after the approval of both houses on the bill it is then sent to the Queen of
UK and becomes a law in parliament which need to be followed to the areas which are
mentioned in the law effectively.
LO 2
P3. Potential Impact of Employment and Contract Law on Businesses
It is very essential for business to understand all the legal framework which is applicable
according to nature of business products and services to increase its potential. Businesses are
very volatile and also are capable to breach the laws unknowingly which impact the goodwill,
reputation of business. It is necessary to implement all the laws which helps to reduce the risk
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and make the organization more effective in increasing the efficiency of in the market. This also
helps businesses to compete in market and earn more revenues in legal framework effectively.
There are various elements of legal contract which business need to understand while
formulating effective contracts which helps to reduce risks and make reduce all the risk of
employment laws and contract laws. There are some elements of valid contract which are
applicable in employment and contract laws.
Impact of Employment Law on Businesses
Increase in the policies of health and safety of work environment has increased the cost
of businesses to maintain the quality of workplace and also provide heath benefits to their
employees. As employees has the right to sue businesses and this can impact the goodwill in the
market reducing the market share and profit margins gradually. Businesses also need to ascertain
that no employee under-age of 18 is legal to enter the contract and in any case businesses will be
held liable and has to pay the compensation.
Impact of Company law on Businesses
As the company law allow separate legal entity which means the company is a separate person
which needs to be entitled with the profit margins of company. This impact the profit margins
efficiency of the business as the profit can not be utilized fully due to company law.
Impact of Contract law on Businesses
Offer and Acceptance
This element is the initial factors which helps to forma the contract and it occurs only
when there is a legal offer and acceptance of the offer by bothy parties (Whincop, 2017).
Proposal or offer needs to be clear, understandable and final and offeree need to accept the
proposal with proper meaning. When both parties agree to the same thing it becomes agreement.
For example, business is the offerer and candidates are the offeree who accepted to be employee
and agreeing to all the policies and salary details it becomes a legal contract.
Intention to create legal relationship
Intention of both the parties must be legal in case of employees which agreed to work in a
business entered the legal agreement with a legal intention which is enforceable by law
(McCormack, 2017).
Capacity of Contract
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If a person which is not capable in the term of law, like minors, insolvent person are not
capable to enter any agreement if entered it will be invalid contract. Capacity of a person means
that both parties are capable to fulfil their promises at the given time and increase the potential of
themselves this is a legal law.
Free Consent
A contract will only be valid when both parties agree to the nature of agreement in their
free will and not in pressure.
Lawful object
A valid contract need to have legal objective and provide legal consent . For example . If
a person entered an agreement to sell drugs or kill someone is considered as unlawful objective
and it is void contract.
Lawful Consideration
Consideration is only valid when both parties enter contract for legal exchanger. for
example, if a person came in an agreement with a person to repair house and the offerer proposed
to pay repairman gun of same amount is illegal consideration.
Certainty in performance
Agreements which have the double outcomes and is not certain of its future is not valid
contracts. For example a farmer entered into an agreement to sell his crops to a buyer for one lac
on when the crops are grown after few moths (Chemerinsky, 2019). This is uncertain as the crops
can be damaged and not produce in quality it is not valid contract.
LO 3
P4 Different Types of Business Organizations
There are different legal organization which have different legal structure and also need
to follow all those rules and regulations to gain better profit margins and increase the quality of
operation in the market effectively.
Incorporated Businesses
It is the business which changes its sole proprietorship and partnership firms into
company to increase their capital by distributing some of their shares in public (Rugman and
Verbeke, 2017). It is the type of business which have different benefits to its owners to reduce its
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liabilities and reduce taxation. Incorporated business increases its capital by sale of its shares in
public to increase productivity of products and services to reach in market effectively.
Advantages
 This helps to protect the assets of the owners from the shareholders and provide better
vision effectively.
 This also helps business top gain better image and creditability in market which helps to
increase its capital when required (Brown, 2018).
 Due to Shareholders and other directors the existence of business increases to long term
and also increase its capacity to compete in the market effectively.
 Incorporate business owners also have limited liability till the capital investment made at
the commencement of the business. The company also has the capacity to make its own decisions without the interference of
any other entity.
Disadvantages
 Incorporated business also increases the cost of business and due to legal formalities.
 According to the law incorporates business need to become more transparency in
providing financial resorts this impact the secrecy of business in market. This also increases the tax liability of business which company has to pay to government.
Types of Incorporated Business
 Joint Venture- It is the legal entity which is formulated between two or more businesses
to focus on profit maximization. All the businesses invest some capital in the venture
which is designed to be for specific period of objectives.
 Limited Liability Company- This is a business model which helps to increase the
business owners from more than two to increase the size of company effectively
(Kanashiro and Starik, 2016). This company provides a limited liability to its members,
and they are responsible to manage all the operations of the business organization to
increase the efficiency in the market and achieve its objectives. Non-Profit Corporation- Non profit organization do not focus on profit maximization as
the main aim of the company is to provide social upliftment and help the society.
Legal Formation
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Incorporated business need to fulfil the legal requirements which includes, name clause,
registered office clause, objects clause, liability clause, capital clause to form legal company in
UK. The owners also have to provide printed and authorized signatures on memorandum of
articles and association. All the documents have to submitted to registrar of companies with
registration fees. After all the documentation if the registrar is satisfied company receives
certificate of incorporation.
Unincorporated Businesses
Unincorporated business are the legal entity which are not separate from its owner, and
they take full responsibility of all the activities pertained in their business (Brijs, 2016). Sole
proprietors, partnership business and family trust business are called unincorporated businesses
which are focused on profit maximization to compete in the market and achieve their objectives
effectively.
Advantages
 Financial Information is safe in the business and it is not required to be disclosed by the
owner in the public.
 Unincorporated business are very easy to understand and handle.
 More control and command of owner on the business. Unincorporated Business has to pay tax on revenue only.
Disadvantages
 Liability of owners increases. Unincorporated business is not perpetual in existence as after the death of owner the
business closes.
Types of Unincorporated Business
 Sole Proprietorship- these are the business which are owned by only one individual and
have full control over its business activities to increase profit margins effectively. This is
generally small and medium-sized businesses. Partnership- Partnership of businesses mean two or more than two owners which share
the capital and incest in the business to gain more profits. In partnership business the risk
and liability is distributed according to shares of capital invested by the partners of the
business.
Legal Formation
8

Unincorporated business need to register themselves under the under self assessment tax
which means the company have to calculate all the revenues and profit to submit taxes to
government on their own (Stuckey and Ellis, 2019). Business have to register under the HMRC
with their name and business firm name effectively. Business also have to mention all the owners
of the company only if applicable.
P5, Managing and Funding of Business Organisation
It is very essential for every business to achieve effective management techniques to
manage all its workforce to achieve objectives effectively. Management is a very important
aspect of every business as it provides information to improve the skills and knowledge of
employees to compete in market effectively (Holloway and et.al., 2017). It is very essential for
every type of business to understand the importance of capital as it helps survive In market by
investing in activities which generates profits effectively.
Incorporated Businesses
Incorporated businesses are more concerned about their funding as they are answerable to
all the stakeholders and shareholders. Due to legal obligation as under company law businesses
are separate legal entity.
Angel Investor
Incorporated business has the opportunity to find effective angel investors as they are
interested in the potential businesses to invest. They purchase the part of ownership of the
company to gain future profits according to their investments.
Venture Capitalist
Venture capitalist searches for more potential company have the ability to fund more to
achieve effective growth in market (Goshen and Squire, 2017). VC helps to fulfil the vision of
Businesses and provide them with better knowledge and guidance to make effective decisions to
grow and expand and earn effective profit.
Equity Capital
Incorporated Business also has the opportunity to raise funds by issuing shares in public
or to its stakeholders and provider them with limited ownership according to legal requirements.
Unincorporated Businesses
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This type of business need to have the personal capital in the initial stage of business.
Unincorporated businesses also have the opportunities to gain funds from partnerships or bank
loans. There are many government subsidies which helps small business which have potential by
providing them funding to operate their businesses. Unincorporated businesses has the
opportunities to gain better funds to expand and grow effectively. Businesses also has the
opportunities to gain funds by innovating and invention new products which increases the profit
margins due to increase in the brand value and increase customer base effectively.
Equity capital
In this the company can sell their part of ownership to another individual or group of
individual which helps to increase the capital and provide more partners which helps to share the
risks and losses according to the share of investment (Adriaanse, 2016). This also help business
to provide information about all the stakeholders effectively.
LO 4
P6. Legal Solutions to Resolve Disputes
A)
Angelica paid 10% amount out of 500 to maxwell as an advance to buy a precious
painting after the ending of the exhibition in Birmingham. However, Angelica found that
Maxwell agreed to sell that same painting to another person in 900 as he wanted to earn more
money for the same painting, and he could not deny a very good offer. In this scenario Maxwell
has breached the agreement which is enforceable by law and it is considered as valid contract as
maxwell offered and angelica accepted and paid a part of agreed which converted into
consideration. Angelica has her rights to seek remedies as Maxwell took money from her and
also agreed to sell the painting to other. Angelica can sue maxwell in court for breach of
contract, or she can also ask for Quantum Meruit which means representment of amount paid.
B)
Nicholas Jakob is an electrician which who has worked in New Castle from beginning of
his career, in the past three years he is being Woking in Regents Visions, but he lost his job as
the company closed its branch in new castle and offered him new job in London but due to his
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family is in New castle he refused to shift to London for the same job. In this scenario Nicolas
has the right to sue Regents Vision under unfair dismissal understand the employment law. In
employment laws Nicolas can claim to get his job back if that is not possible, and he must be
entitled to compensation according to his needs and wants to support his family. The company
also has the right to seek redressal and provide the proof that Nicolas has been offered a job, but
he rejected it. There should not been any compensation.
C)
Johnson is an employee in construction company which met in an accident by falling off
the stairs railings and hurt his back he was at rest for 4 weeks and did not go to work. Johnson
claimed for compensation as due to unsafe work but company rejected it by saying that there is a
safety board on ground floor about the loose railing (Goldberg and Wilkinson, 2019). In this
scenario company has provided information about the fact that railing is not properly fitted and
but according to employment law company have to provide effective information to all the
employees about all the unsafe areas and company failed in this care to do so . A compensation
to Johnson must be entitled and also educate all the employees by providing them with better
safe work and healthy environment,
CONCLUSION
This report concludes that legal system and laws are very essential in country to promote
and provide safety to its citizens effectively. Report discussed law making process of UK which
also helped to understand employment, contract and company laws which impact the businesses.
Report discussed different types of organization which are formed legally managed and funded
to increase their potential in the market effectively.
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