Business Law: Sources of Law, Legal System, and Impact on Business

This report discusses the sources of law, legal system, and impact of business law on different types of business organizations. It covers topics such as the formation of different types of business organizations, managing and funding of different organizations, and critical evaluation of different types of business organizations. The report also provides recommendations for legal solutions to case scenarios.

Business law

Table of Contents
INTRODUCTION................................................................................................................................3
PART 1..................................................................................................................................................3
THE LEGAL SYSTEM ..................................................................................................................3
EVOLUTION OF THE LEGAL SYSTEM.....................................................................................3
DIFFERENT SOURCES OF LAW ................................................................................................3
LEGISLATION, REGULATIONS AND STANDARDS ...............................................................4
ROLE OF GOVERNMENT IN MAKING LAW AND ORGANISATION IN JUDICIARY........4
CRITICAL EVALUTION OF DIFFERENT TYPES OF BUSINESS ORGANISATION.............4
IMPACT OF THE LAW IN BUSINESS.........................................................................................5
PART 2..................................................................................................................................................5
The formation of different types of business organisations.............................................................5
Explain managing and funding of different organisations...............................................................6
Recommended suggestions towards case laws mentioned below...................................................7
Legal solution:.................................................................................................................................8
CONCLUSION...................................................................................................................................11
REFERENCES...................................................................................................................................12

INTRODUCTION
Business law, also known as commercial law or commercial law, regulates the dealings
between commercial and private matters, whether through agreements, conventions, national and
international laws. These laws deal with the law of contracts, agreements and conventions dealing
with matters related to trade and commerce. Business law helps the state motivate a company's
employees to work in an organized and organized manner. This also helps in forming an appropriate
policy for the business organization. Business law is state labor law. The law to assist the
government in generating revenue through taxes forms a company operating in the country
(Farrugia, 2018). This report is in two parts, the first part is in the form of an essay and contains
sources of law, the government's role in legislation and the application of laws to the Court. The
second part of this report consists of the impact of contract and labor law on business, the formation
of different types of business and the way business organization was managed and funded in this
report. This report also describes the comparison of different sources of legal advice and assistance
in dispute resolution, which provide appropriate recommendations for a legal solution.
MAIN BODY
PART 1
THE LEGAL SYSTEM
The UK legal system is based on various viewpoints that exist in society. There are two
major laws, civil and criminal. In civil law, they take in consideration individuals and problems
related to civil lawsuits are dissolved in civil courts. Criminal law deals with all criminal cases.
Both laws have procedural rules and are followed in criminal and civil matters. The Criminal Code
deals with provisions such as murder, theft and robbery. The Civil Code deals with matters related
to property, contracts, torts, and state affairs. District courts handle criminal cases. Both laws serve
to apply the legal aspects in practice and this proves legal validation(Mandal, and Aiyanna, 2020).
This is how the new legislation that was implemented in the country was developed in the English
legal system. Changes have been made in the Companies Act, giving companies the power to do
business in the market. The competitive market threshold for start-ups is also being reviewed.
EVOLUTION OF THE LEGAL SYSTEM
There is a common law in the UK, but no written constitution that makes a big difference,
and a co- seismic situation that leads to imbalances in law and enforcement. The rules of the Stare
decisis are enforced in English courts(Direction, 2019). Therefore, if a similar situation is ruled in
the name of precedent, there is a reliance on previous decisions. But this breaks the lawful harmony
that the situations are related but not the same and raises a direct question of law. The post-Brexit

conditions are not favourable for the UK legal system. There are various procedural changes made,
such as competitive market valuation thresholds, and the entry of new companies have changed
with new rules and regulations
DIFFERENT SOURCES OF LAW
The two main sources of the law in the United Kingdom are primary and secondary sources.
Primary sources- The main source of law is the legislation enacted by the country's parliament. This
is data provided by the State Legislature. Primary sources of law include all data required by law.
These are the laws which are enacted by bodies in command. The main sources which provide the
legal informations are the case laws. Relevant laws include everything from state law in city
ordinances to published case law published by law(McCashin, 2021). Judiciary is the decision
made by the courts of a country. Case law is considered by the courts and is binding on state lower
courts. This obliges the courts to follow the decisions of the country's High Courts.
Secondary Sources- Any legal documents which are not emanating from courts or legislatures were
designated as secondary sources of law. These are not decision which are made by judges, nor is the
law passed by the legislator. It is the composition of one or more authors, each of which analyses
the law from a particular point of view. Secondary sources of law include monographs (i.e. treaties,
textbooks, published articles, case studies on textbooks), government reports, collections of essays,
conference proceedings, or legal training program materials. will be Secondary legal sources rely
entirely on primary legal sources, including court decisions, new laws, etc., to enhance the analysis
and discussion in articles and books. Judges and legal scholars therefore take a note of the points
said by the legal scholars on any specific matter.
LEGISLATION, REGULATIONS AND STANDARDS
It is an legal entity which rules a collection of body or an community, organisation, an
industry or whole of the country. The law has a systematic manner of making legal guidelines in the
course of a rustic for every citizen, and all of the legal guidelines are hooked up with the aid of
using law which has to be accompanied with the aid of using all of the enterprise
entrepreneurs(MUCHLINSKI, 2018). Regulations are set of legal requirements which need to
follow through the enterprise for doing business or any of the opposite dealing which must are
associated with the legal obligations of the country because of safety of product, consumer
protection and plenty of other think about interest of public which makes rules for an
administration.
ROLE OF GOVERNMENT IN MAKING LAW AND ORGANISATION IN JUDICIARY
There are mainly three bodies of government which are executive, judiciary and the

legislative. The work of the executive is to develops and perform various policies. In the legislative,
the UK Parliament, consist of the Crown, the House of Commons and the House of Lords. In the
judiciary the judges and other officers of the courts and tribunals,take care of the matters filed under
the courts according to the nature of the case(Danielsson, and Hyams-Ssekasi, 2022).
There are two types of law in the states which are :common law and statutory law. Common law is
law formulated in an unwritten form. There are no procedures in place for implementing these laws
in the country. Law includes case law, jurisprudence, etc. A statute is a law enacted by a specific
procedure in a country. These laws were authorized through appropriate state legislative processes.
CRITICAL EVALUTION OF DIFFERENT TYPES OF BUSINESS ORGANISATION
Turning an LLP, retailer, or public company into a stock company is not as easy. A business
requires a lot of attention, money and even time for having a effectively operation. There is a
requirement of various investment from variety of people and even there must be a proper time
management(Oldman, 2021). This is all because business owners require number of activities and
skills to fully understand the business circles so that it can comfortable to stay in the business
environment and have growth in the market. It leads to business growth that is not possible for an
individual. Willing to manage wins and losses computationally.
IMPACT OF THE LAW IN BUSINESS
Every business and organisation in the United Kingdom have there own legal rules and
regulations,which affect the operation of the company effectively. There must be healthy
relationship among the employees and even the employer within an organisation.
Impact on company- When companies generate income from their profits, there are some legal
obligations that affect them through taxes paid to the government. This completely depends on the
structure of your company. Within three months, the sole proprietor must register with HMRC. In a
limited liability company, there are a number of requirements for the company, the company must
be registered in the company house and all directors must also be registered along with the major
influencers of the company.
Impact on employment-Under the Employment Act, companies have legal obligations to their
employees by providing them with minimum wages, liability insurance, pensions, and more. If
there are some legal requirements that the employer must include in the company, the company will
suffer a great loss if they fail(Pryce, 2022). A company's legal obligation is to check whether its
employees have the right to work in the UK. Employers must pay their employees according to the
national minimum wage set by the UK government. All employers are required to provide their
employees with a written legal contract detailing working hours, salary, employee obligations and

contractual rights.
Impact on contract- The contracts essentially have an effect on the commercial enterprise because
of any employer or organisation. The regulation of agreement is concerned in every state of affairs
of selling, purchasing and resell of the good, there may be a criminal component wherein a
agreement is need to. There is a agreement in each component of commercial enterprise purchaser
or supplier have agreed and even there may be a agreement among corporation and employee. The
agreement may be verbal or in written format.
PART 2
The formation of different types of business organisations
Sole proprietorship: A sole trader in business, run through single individual and have all
duties and responsibilities which is fulfilled through this one person. In a business enterprise there is
no differentiation within organisation and owner. In this one can employ people for distributing
responsibilities but this can not share organisation with any other person. Forming a sole
proprietorship in business is not easy and do not need any legislation. Usually, there is no such need
to be legally register, if a person wants to register a company in local registration office and starts
business.
Partnership: In this kind of organisation one can share responsibilities and duties with any
other person. This is a contractual agreement form of organisation to made a legal agreement within
two people. The contract consists duties divisions, profit ratio and responsibilities, which is to be
shared by both. In this business form two people agree on some terms and condition to which both
of them gains in monetary terms. The partnership firm have to follow steps which are mentioned to
accurately formulate legal partnership:
 Make a contract within all partners and get this verified legally.
 Registration of organisation in local registry office.
 Start the business and Set-up share holders.
Limited liability partnership: This is exactly like normal enterprise, this is made on the
basis of contract agreement with terms and condition and ratios which are pre decided in the legal
document. The difference in this enterprise have that no partner share liability with debt of
companies and creditors(Rutterford, Sotiropoulos, and Van Lieshout, 2022). In this, the company
is a separate legal entity in nature and do not need any member have responsibilities on debts of
company. This is very much sufficient in nature and do not affect their own owner in time of
winding-up. Legal procedure for setting up LLP is mention below:
 Register in Company House.

 Prepare list for directors and hire secretary.
 Sell some shares in public.
 Set-up policies for business and hire employees.
 Begin business with decided percentage of responsibilities and duties.
Explain managing and funding of different organisations.
Basis of: Sole proprietorship Partnership LLP
Management Managing this kind of
firm is very quick and
easy to do. This is solely
work and managed up
through single
person(Smith, 2022).
The person have to fulfil
the duties and
responsibilities for firm
and all decision for made
in the business is dome
through one person, this
means no entity have any
authority for making any
debts.
Managing firms
includes time taking
and have a lot of paper
work, the duties and
pressure of work is
divided in two people
and never a single
person. In this
company is headache
for all member equally.
In LLP, basic additional
point is for their
separate legal entity in
nature which describe
this to be beneficial in
nature, if any
consequences arise and
company have to wind
up then the personal
asset are not held liable
for this.
Funding  Personal loans
 Loans by bank
 Savings
 Personal loans
 Investment
through every
partners.
 Share and
debenture of a
company.
 Bank Loan
 Sell share on
stock exchange.
Recommended suggestions towards case laws mentioned below.
The system of court is most traditional form to solve dispute within the parties. Apart from
this, the government of UK have made alternate dispute resolution in the Civil Procedure Rules,
1986, so, that the parties get fast disposal of cases. The solution is cost and time effective and

parties have out of court solution. Various alternative dispute resolution for case scenario is
discussed below-
Case 1
Scenario:
Gordon is a salesperson at Orange Computer Ltd. And this employment contract mentions
for annual salary of ten thousand pound and commission in sales of 9% which have average of
eleven thousand pound per annum in last 3 years. In year 2015, because of competition the business
was affected. Fred ask Gordon to forgo the salary of 2015-17 and accept only commission. Gordon
accept variation in contract. In year 2016, when the economy began for expand and company starts
earning good profit. Now Gordon wants to claim salary of year 2015-17.
Legal point:
In this the scenario of case is the legal point is that whether Gordon is entitled to salary in
year 2015-17?
Legal solution:
In the given scenario, solution for recommendation is negotiation. This includes appointing
independent third party which negotiator try to bring amicable solution for the parties. The main
aim in this is to bring win win situation for both parties. The decision of negotiator is not binding
until agreement is not signed within the parties(Zlatina, and Kravchuk, 2020).
Legal justification:
The solution is recommended to Gordon as negotiation includes early solution and parties
gets fast disposal of the case. Negotiation encourage win win situation for Gordon and the company
both and each of them get friendly solution.
Effectiveness of legal solution
From negotiation, Company and Gordon have negotiation within each other for wages in
last years. This assists them for coming to such situation which is beneficial for both parties. The
case is related to the variation in contract for employment which was made with consent of both
parties. So, the negotiation assists to come at amicable solution(Biedermann, 2021).
Case 2
scenario:
Janet decided to call the Virgin media for installation and purchase of internet package
which will cost £35 per month which includes phone lines of monthly rental of £11. the engineer
came the next day and installed the internet but did not find the telephone point so suggested to
come back after talking to supervisor. Janet waited by engineer did not came so she complained
about the engineering to company. After 3 weeks the telephone was installed and the invoice came
which which Janet was charged with whole package including telephone line for whole month.

Legal point:
The main issue in this case is Whether Janet is liable to pay the the entire month phone
rental despite the fact that it was installed after three weeks ?
Legal solution:
In this case scenario, the solution recommended is mediation because it involves appointing
independent and unbiased mediator who mediates between the parties. Its decision is not binding on
the parties but will help in solving the dispute in quick manner.
Legal justification:
This solution is recommended as it will help the company to protect its goodwill as the
matter will be solved internally(Cowling, 2021). Janet will get the speedy disposal of case. As
Virgin media failed to provide adequate service to Janet so mediation shall help in understanding
each other points and the matter will also be kept confidential.
Effectiveness of legal solution
As Virgin media has breached the contract of service so they are not entitled to charge rental
for the month where Janet have not used the telephone. Mediation will help them to solve the
dispute internally which will also help in protecting the reputation of the company. This case is
regarding the contract and virgin media have breached the contract by not fulfilling their contractual
obligation.
Case 3
Scenario:
Black Horse Ltd is security company which has 50 employees. It has four main customers
who failed to repay its money with the bad debt of around £100000. the company was unable to
repay its creditors and one the creditor has filed the petition of winding up and now court has to
decide as to whether winding up order must be issued or not.
Legal Point:
The issue is Whether the creditors have the last resort to file the winding up application for
company Black horse ? And Whether winding up is the last solution available to creditors ?
Legal solution:
The solution advised for this case is arbitration. It involves appointing and independent
arbitrator who shall after hearing the facts of case and evidence on record, provide the award which
is binding on the parties. The main benefit of this is that the parties can select their arbitrator, time
and place of the arbitration.
The client can also opt for conciliation. It also involves appointing the independent
conciliator who examines the facts and evidence and provide the decision which is called the

settlement. It becomes binding when the parties sign the settlement agreement. In this, the parties
have flexibility to change the settlement agreement as per their convenience. And when it is signed,
it has the binding effect.
Legal justification:
This solution is recommended so that the parties can solve their dispute outside the court.
Arbitration has same validity and binding effect like the court so this solution can help parties to
have speedy disposal of case and the binding award can also be brought for the parties(Croce,
Ughetto, and Cowling, 2020).
Effectiveness of legal solution
Arbitration can help in bringing the evidence on table for the creditors that the company is at
no fault for the non payment as their major amount of money was converted into bad debts
suddenly. So arbitration will help in brining binding decision between the parties.

CONCLUSION
In this report this is concluded that the legal system of UK have many complex area which is
very easy to understand or either most confusing in the world. This is wholly depends as according
to factual statements of situation which a precedents of court and whole legal system of UK is based
on this only. Previous judgement is most essential entity for providing judgements in any case and
most importantly to for legal formation of country for making sure that a court have accurate facts
for the dispute in making decision of gives judgements which are for both parties in dispute. The
modules of business in country have legal obligation in respect of the fact which a business hold
through a sole trader, limited liability partnership, each one have to make sure that the legality of
business or other in the organisation can face the risk for heavy loss in the investments. Various
organisation have different obligation in the business, the legality in formation of a company and
dissolve it have method in the legal system which is surely an essential aspect to taken at time of
formation of enterprise.
To get justice instead of going to court there is other legal entities in UK, which is ADR for
which a person can get faster justice and resolve the issue in easy manner. Whether they choose
mediation, conciliation or arbitration, this is wholly depends on the particular situation of the
dispute for parties. There is various modules in UK law which is in some situation can provide good
resolving mechanism for any conflict in the parties.

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