Business Law: Understanding Legal Principles and Solutions

This assignment delves into the intricacies of business law, exploring its impact on company operations, decision-making, and legal compliance. It examines key legal concepts such as company law, contract law, and employment law, analyzing their implications for businesses. The assignment also investigates the role of government in lawmaking, the effectiveness of the legal system, and the application of legal solutions to common business problems. It further explores alternative dispute resolution processes and compares their effectiveness to traditional court proceedings.

Business law
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Contents
Introduction................................................................................................................................3
Task 1.........................................................................................................................................4
P1 Explain different sources of law and laws that organisations must comply with.............4
P2 Explain the role of government in law making and how the statutory and common law
is applied in the justice courts................................................................................................6
M1 Evaluate the effectiveness of the legal system in terms of recent reforms and
developments..........................................................................................................................9
Task 2.......................................................................................................................................10
P3 Using specific examples illustrate how company, employment and contract law has a
potential impact on business................................................................................................10
M2 Differentiate and analyse the potential impacts of regulations, legislation and
standards...............................................................................................................................11
D1 Provide a coherent and critical evaluation of the legal system and law, with evidence
drawn from a range of different relevant examples to support judgements.........................12
Task 3 - Suggest appropriate legal solutions to business problems.........................................13
P4: Suggest appropriate legal solutions for a range of business problems e.g. termination of
contract, rescue from insolvency and liquidation using your organization as an example..13
P5: Provide justifications for the use of appropriate legal solutions in your organizations.....15
M3: Assess the positive and negative impacts of legal solutions to business problems
mentioned in P4....................................................................................................................16
Task 4.......................................................................................................................................17
LO4 Recommend appropriate legal solutions based upon alternative legal advice provided. 17
P6 Recommend legal solutions based upon a different country’s legal system and/or a
different legal framework.....................................................................................................17
M4 Compare and contrast the effectiveness of these recommendations.................................20
D2 critically review and evaluate the use of appropriate legal solutions in comparison with
alternative legal advice.........................................................................................................21
Conclusion................................................................................................................................22
References................................................................................................................................23
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Introduction
The objective of this assignment is to get the understanding of business law which is applied
to the functions and operations of a company. It will enable the learners to get the knowledge
of law in business and to determine the impact of law on decision making and operations. It
will also give the analysis of law in respect to director responsibilities and market abuse. The
business law study is able to consider the application of contract law, company employment
law between employees and employers. The legal system is included with sources of law,
description of companies Act 2006, Equality Act 2010, health and safety Act 1974. The
difference between common law, statutory law equity is described. The regulations,
standards, and legislations are also discussed with positive and negative impact on legal
solutions. The solutions are also given in case of termination of contracts, rescuing from
liquidation and insolvency. The alternative dispute resolution process is also explained in
different terms so citizens advice, trade unions, arbitration, and mediation and conciliation
process. The importance of court proceedings and alternative methods are also discussed in
detail.
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Task 1
P1 Explain different sources of law and laws that organisations must comply with.
Law is the set of rules and regulations set up by the government to bring peace and harmony
in the country. Law regulates the acts done by anybody in a particular country. The main
purpose of setting up of laws in a country is to maintain the actions and activities done by the
people in a country. In presence of law, the activities of the people are under control and do
not violate rights of other people. Setting up of law in very much necessary in today’s world
to put a regulation over the people and stop them from doing any illegal acts to up rise the
standard of the country on the international level.
English law system is one of the oldest legal systems and was founded over 900 years ago.
One of the facts of English law is that the law which was developed in older times, they are
still in existence with few of the changes as required by the society to develop. The law is
also developed in every field from time to time to meet the requirements of the society.
English legal system is also developed from the judgments of the courts which are passed in
cases. Case laws play a vital role in the evolution of English Law. The lawyers in English
court still cite the cases from the seventeenth century. For example, the case Lampleigh v
Braithwait (1615) 80 E.R. 255, this case is cited for the exception to the principle where
consideration moves from the promise which is made (Khanna, 2015).
There are different sources of law for English law. The sources of English law are further
divided into two parts consisting of:
a. Primary Sources
Under primary sources, two of the major points are there including case law and the
legislation. English legal system is based on case laws and the older case laws are still
referred by the advocates in the court rooms. The judges themselves consider the previous
judgments passed by the courts when they need to pass a judgment where the case is similar
to the previous case. It is considered as one of the important sources of English law. Another
source is considered as the legislation passed by the government. The rules which are setup
by the government is also considered as a source of law where the laws are made in
accordance with the requirements of the society.
b. Secondary Sources
Secondary sources include the law textbooks by the experts, encyclopedia as well as the law
journals. These are few of the sources of law which comes from the primary sources but
sometimes they are also considered as references in the courts (Library of Congress, 2015).
The laws that an organisation must comply with are as follows:
a. Companies Act 2006: It is one of the laws which helps the company to gets its legal
existence in the society. All the rules and regulations which are to be followed by the
company are written down under this.
b. Contracts (Rights of Third Parties) Act 1999: Contract act governs the contract
which is made between the employer and the employee. It includes the rights and
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liabilities of the third party in the contract. Any violation done on the party of either
of the party leads to an offence in the eyes of law.
c. Equality Act 2010: This is the most important act which is to be followed by the
company. This act states that the company should not discriminate among the
employees. Every employee must be treated equally in the company. There should be
no discrimination on the basis of race, caste, sex, religion, colour etc.
d. Health & Safety at Work Act 1974: This act ensures the safety of the employee in
the workplace. The responsibility of safety in the workplace lies on the shoulder of
the employer. If any mishap happens with the employee while working then the
employer will be held liable for the same (Worksmart, 2018).
e. Advertisement Regulation Act 1955: If a company is marketing then they have to
follow few of the guidelines before advertising the company. The guidelines to be
followed in marketing and advertising strategies are:
 All the strategies should be legal.
 Decent advertisement.
 Honest and truthful information over the advertisement etc.
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P2 Explain the role of government in law making and how the statutory and common
law is applied in the justice courts.
There is a difference between statutory law, common law as well as equity. The differences
between all three of them are as follows:
a. Statutory law: the Statutory law is the formal form of law which states the laws
which are written. These laws are basically made by the government. It is basically
made to keep the citizens safe from the criminal offences. Whenever a statutory law is
broken by any person it leads to an offence which is punishable under law.
b. Common law: Common law is based on the precedents, also these helps the judges to
pass the judgment by referring similar kind of cases from the past. Majorly contract
law, torts and property law depends upon the common law (Laws, 2017).
c. Equity: Equity is also known as one of the source of English law which came after
the common law. The reason for the development of equity is to reduce the strictness
and non-flexibility of the rules and regulation set up under common laws. The two
maxims of equity include:
 Equity will not suffer a wrong to be without a remedy.
 He who comes to equity must come with clean hands.
The difference between Company law and Contract law are as follows:
a. Company Law: Company law governs a registered company under this act. All the
rules and regulations prescribed under the company law are to be followed by all the
companies. Company law also defines the work that the company would be doing in
the future. The company has to form an Article of Association as well as
Memorandum of Association, which would define the work which the company
would be doing and the location of the office of the company respectively (Outlaw,
2018).
b. Contract Law: Contract law regulates the contract which is made between the
parties. It defines the rules and regulations which are to be followed by the parties
while in contract with each other. If the parties into the contract are not able to
complete all the rules and regulation set up by them and either of the party violates the
terms and condition, then this would lead to a breach of contract (Sexton, 2016).
Government plays the most important role is law making as the laws are made by the
authorities of the government. Therefore the major role is played the government of the
country. TO make any law a proper procedure is to be followed by the authorities which
include the following steps:
a. First Reading: In this, the bill is presented to both the houses.
b. Second Reading: Here the bill is discussed among the members of the houses with the
relevance of the new law.
c. Committee Stage: Here the amendments are done in the bill if they are required and if
majority of people agrees with it.
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d. Report Stage: If amendments are done in the bill then those amendments are
discussed in the houses again.
e. Third Stage: This is the stage where the chance for final amendments is given to both
the houses.
f. Royal Assent: This is the stage where the bill is sent for the signature of the queen and
then it becomes a law in the society.
The organisation of Judiciary includes the following points:
Organisation of the courts and tribunals, the organisation of jurisdictional responsibilities, the
Judges’ Council, the Judicial Office, the Tribunals Judicial Executive Board, the Judicial
Executive Board and the allocation of day to day responsibilities.
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Jurisdiction and the structures of the court are as follows:
(Source: Texas Law, 2018)
Supreme Court of the United Kingdom has jurisdiction to hear the matter of both concerns
i.e. criminal as well as civil cases. Basically, the criminal cases can be heard by Court of
Appeal, Crown Court and Magistrate Courts. On the other hand, the jurisdiction to hear the
civil matter lies with Court of Appeal, High Court of Justice and County Courts.
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M1 Evaluate the effectiveness of the legal system in terms of recent reforms and
developments.
Legal system is the set of rules, principles as well as the doctrines set up for the society and
which has to be followed by the society to maintain peace and harmony.
Legal system constitutes of laws that are:
a. Civil Laws.
b. Criminal Laws.
English legal system is used in the United Kingdom which is one of the oldest legal systems.
The recent reforms in English legal system are lowering down of court fees which makes it
suitable for the people over there to file a suit in the court if required. The developments of
laws are also done in the recent period which makes the law competent with the present
situation of the country. The reforms and development are done in every law wherever it is
required. The recent reforms and development can have impacts on the business in a positive
as the set of rules for business have developed to ensure the safety (Inbrief, 2018).
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Task 2
P3 Using specific examples illustrate how company, employment and contract law has a
potential impact on business.
Employment law is the law which governs the rights and liability of the employee as well as
the employer. It gives protection to the employee as well as the employer from any wrong
which can occur with them while in course of action. Employment law also sets the rules and
regulations. Contract law governs the contract which is signed by two or more parties. The
parties are bound to follow the terms and conditions of the contract and missing any of the
conditions of the contract leads to a breach of contract (Noblet, 2018).
Employment and contract law can play a vital role in a business. It regulates the companies’
employee as well as the employer and it also regulates the contract which is signed by the
companies and the employee. The example for public limited company in the United
Kingdom is British Petroleum. The company has flexible hours of working where employees
can work accordingly. The company also pays for holiday as well as for the time for which
extra work is being done. In the company equal opportunities are provided to every employee
without discriminating among them. This leads a positive impact on the company over the
employees associated with the company.
In British Petroleum the proper procedure to hire an employee is followed by the employer. If
an employee is indulged in some illegal act or anything with is against the work ethics or the
regulation of the organisation then the employer can fire the employee. This would impact in
both positive and negative ways to the business. As it would help in hiring new and capable
employees and also will remove the employees that are of no use to the company.
The director is responsible for the working of the company and meeting the targets which are
setup by the company. The director delegates the tasks among the employees to get them
completed within the time limits. The task is delegated to the employees by the directors to
get it completed within the time limits.
The employer cannot discriminate between the employees on the basis of sex, this is being
defined in Sex Determination Act 1975, the employer is bound to pay equal amount of pay to
the employees who are assigned at the same level of position under Equal Pay Act 1970,
Employment Act 2008 defines the equality among all the employers of an organisation and
also includes the rights and liability of the employee and the employer, under National
Minimum Wages Act 1999 employee is entitled to follow this act and provide minimum
wages to each and every employee according to the rules of the country (Politics, 2018).
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M2 Differentiate and analyse the potential impacts of regulations, legislation and
standards.
Legislation: It is also known as a statutory law which is produced by governing body for the
regulations, to sanction, to authorise, top grant, to restrict and to declare something. in respect
of the events, legislation means governing the legal principles by outlining the duties and
responsibilities of organisers, and another stakeholder like local authority, for the safety and
protection of the public.
Standards: The term is considered in doing something. it can be the product making, process
of management, supplying or delivering materials, standards include a high rate of activities
which are undertaken by business organisations and used by the customers (Partington,
2016).
Regulation: This is the statutory instrument which is passed by the member of an executive
branch of government. For example, the cabinet meeting in federal session endorses the
particular regulations, but every regulation has a distinct feature. It must relate to the
authority of statute and each regulation should have some statute that enables it.
The potential impact of legislations:
As per the legislation of environment protection, every company adapts the regulations which
limit and restricts the amount to be expanded in the environment of hazardous elements and
particles. The safety and health legislation provides that employer is responsible for the
health and protection of employees at workplace level. The consumer legislation provides
that rights of consumers are not infringed at the time of dealing with products and services.
The law of information technology provides that data and information are protected from
third party unauthorised accesss without the permission of author. It protects the data with
more confidentiality. The rules and regulations of cyber security provide that data and
information are protected with best effort from hacking and any other unreliable sources
(Partington, 2016).
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D1 Provide a coherent and critical evaluation of the legal system and law, with evidence
drawn from a range of different relevant examples to support judgements.
The example of employer and employee relationship can be undertaken by considering the
evaluation of laws and legal system. The relationship is based on different approaches such as
level of employment. Employer of the company is liable to protect the safety and health of
employees at workplace, in case when any accident takes place due to the fault of employer
then he is liable to make payment to employees. As per the company Act board of directors
and shareholders are the two bodies of people. Directors are the brain of company who in
charges the management of business. Directors make operational and strategic decisions for
the company and meet the statutory obligations. Company secretary is the administrative
officer of the company, who is responsible for several tasks in the companies Act. The
English legal system deals with civil law, common law and the religious law which is the
basis of all laws and regulations present in the country (Wilson, et. al., 2014).
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Task 3 - Suggest appropriate legal solutions to business problems
P4: Suggest appropriate legal solutions for a range of business problems e.g.
termination of contract, rescue from insolvency and liquidation using your organization
as an example
There are several problems are faced by business organizations like termination of contract, formation
of company, raising capital, correlation between performance and pay, rescuing from insolvency, and
companies which re in liquidating a position.
Registration of companies: A company is established with issuance of a different registration number
issued by companies when a limited liability partnership or limited company is incorporated. It is
basically abbreviated as corporate registration number and can be referred as companies House
number. The number will include 8 numbers, 2 letters followed by 6 numbers (Han, 2016). The
essential requirements of the company formation are as follows:
 Propose the name of company.
 registered address of the company
 details of the company directors
 details of the company secretary
 details of the shareholders
 Information of the share capital
 significant control details of people
 articles of association
 memorandum of association
Necessary documents are required:
Articles of Association: This is the outline which considered the rules and regulations for running
company, including legal responsibility and internal management affairs.
Memorandum of Association: It includes the subscriber's name such as initial shareholders who are
establishing the company (Han, 2016).
There are several requirements for registration number some of them are as follows:
 to change the name of company
 To change the registered office address and SAIL address.
 To add or subtract the director name or secretary name of company.
 to filling the annual returns
 to filling the annual accounts
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 to registering for taxes applicable to business
 Paying company tax
 filing tax returns and copies of resolutions
 Increasing share capital.
Insolvency: The term which can apply to either a business or an individual, but is used in respect of
the company or business. A business is known to be insolvent when it cannot pay debts when they are
due (Singer, 2018).
Liquidation: In this process, a liquidator is appointed for the winding up of company in which assets
are sold and liabilities are pay out. The company ceases to exist and deregistered after the winding up
process. The most common kinds of liquidations for insolvent companies are creditor’s voluntary
liquidation and court liquidation.
Termination for breach of contract
A contract can be terminated when one part of the contact breaches the terms a d conditions of a
contract made. It can be done as follows;
 On the party of the contract breach the conditions...
 The innocent party can accept the breach.
 The question of the breach is an anticipatory and repudiatory breach (Sullivan and Robinson,
2017).
Contractual damages: The damages are payable to an innocent party who is suffering from breach of
contract. The damages are assessed as per the date of the breach of contract. The overriding objective
of damages awards from breach of contract is to give the payment to an innocent party. There are main
categories of damages that can be recoverable by an injured party as an outcome of breach of contract:
 Damages for non pecuniary loss
 Damages for pecuniary loss
 Nominal damages (Singer, 2018).
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P5: Provide justifications for the use of appropriate legal solutions in your
organizations
The several justifications are made on the use of perfect legal solutions in the organizations
are established.
Application of corporate law in making companies: Before making any company whether limited y
shares or not, it must be regulated by the provisions of company law. The business capital has several
types of shares, right issue, loan, debenture, Equity etc. debenture is considered as the critical form of
long term loan that is taken by company. It is basically a loan that will be payable on a specific date,
but some of them are irredeemable securities. A right issue is given to the existing shareholders of the
company for buying additional shares from the company directly in proportion with the current
holding (Dignam and Lowry, 2012). In case of any business problem related to company regulations
of companies Act, 2006 are followed.
Termination of contract: A contract is made up with the process of offer and acceptance between
one or more persons. In case when any party does not follow the contractual; obligations and breaches
the contract then aggrieved party is liable to receive liquidated damages or compensation from the
defaulter. It is justified that provisions of contractual damages are applicable to the party who is
suffering from the breach of contract (Percival, et.al., 2017).
Rescue from insolvency: The Company can take several steps to reduce the risks associated with and
to rescue the company from insolvency and liquidation. Some of the steps are as follows:
Credit check to customers: Check the reference by trade debtors is every important, especially in
case of operating the industry with a high rate of failure.
Check the credit limits: Companies check the credit terms in respect to secure the new business and
to make a good relationship with new customers. There is a requirement to keep close eyes on such
limits of credit.
Execute credit control process: There must be effective and clear control procedure which is t be
followed every time, it will help in identifying the exposure at a preliminary stage and work
accordingly (Percival, et. al., 2017).
Explore invoice financing and credit control: A credit policy of insurance will protect the business
from the failure of payment risk. Invoice financing is the non recourse factoring which will pay the
proportion of amount to invoice upfront. It can help in the protection of business by the insolvent
customer's impact (Company debt, 2017).
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M3: Assess the positive and negative impacts of legal solutions to business problems
mentioned in P4.
Positive impact: After the establishment of English legal system in the country it makes very easy to
reduce the level of crime rate in the states. The principles of the constitution are always followed in
daily routine life and all business organizations in the country. The development of recent reforms
makes a good impact on the growth of the country by initiating the cyber security, information
technology etc. the Equality Act 2010 provides that all people of the country are equal irrespective of
the discrimination. The free legal aid is also given to disabled people who are not able to fight in front
of the court (Dignam and Lowry, 2012).
Negative impact: On the other hand, some negative impact is also there of legal solutions to business
problems are, strict regulations are not complied by the people of society. The high fees are charged
by court and practitioners to solve the case is also makes a bad impact. Reforms and developments
made in the country create a modern approach which makes a bad impact on the country (Percival,
et.al., 2017).
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Task 4
LO4 Recommend appropriate legal solutions based upon alternative legal advice
provided
P6 Recommend legal solutions based upon a different country’s legal system and/or a
different legal framework.
There are several Alternative legal advice is provided to solve the issues in business
organizations. Some of them are as follows:
 The service contact Act 1965
 Competition and Consumer Act 2010
 The role of Union
 Citizen Advice bureau
 Alternative Dispute Solution (ACAS)
Trade unions in the United Kingdom: Trade unions are a number of employees who join
with each other to maintain and increase the conditions of employment. Almost seven million
people in the country are included in trade Union. members of union cover school meals
staff, nurses, hospital cleaners, football players, assistants at shops, technical assistants,
engineers, bus drivers and apprentices etc.
Trade Union Act 2016
As per the Act 2016, Trade union has different provisions and statutes under the law that
provides special power and rights which don’t have professional associations. Employers of
the company have to work with Trade Unions to:
 Negotiate working conditions and payment with each other in the organization.
 Consult over modifications and inform about the work redundancies.
 It makes ensure the safety and health of workers are protected (Partington, 2015).
Role of trade Unions:
 trade Unions bought important changes at the society level that includes:
 national minimum wages
 the abolition of child labor
 increased worker safety
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 Increasing labor standards by decreasing the hours in the week and motivating a
balanced and healthy life.
 increase the parental leave
 equality legislation
 Provide better protection to employees and reduce the exploitation.
 sickness entitlements and minimum holidays
There are several numbers of Trade Unions are as follows:
UNISON, Unite, GMB, TUC, UCAC, URTU, UCU and USDAW
Citizen advice bureau
The citizen advice bureau gives a special and dedicated advice, casework and information
service. Trained and experienced advisors who deal with conflicts such as debt, immigration,
benefits, and employment and housing issues. It also offers an opportunity to young people to
become a volunteer (Hierarchy, 2018).
The legal system of USA:
The US legal system is a very complex system of state and federal governmental divisions. In
order to get knowledge about the US legal system, it is must know that which rules, laws and
regulation control are followed. In other words, laws have importance on controlling effect
and priority. It is considered that US constitution is the largest law of the land.
Australian legal system: this is the parliamentary democracy. The constitution of Australia
1901 established a separate federal system of government in the country. In this system,
powers and rights are distributed between national government and the six states (Findlaw,
2018).
Advisory, Conciliation and Arbitration Services:
This is the non-departmental body of United Kingdom government. The purpose of this
service is to improve the working life of organizations by facilitating and promotion of strong
industrial relations practice. There is a number of processes are practiced like mediation and
arbitration, negotiation and adjudication. This is the method of solving the disputes between a
number of employees and workers, represented by employers and Trade Union. This is the
impartial and independent organization which does not side with a specific party, but help the
parties in solving the case or dispute at extent level. In the process, a neutral party is
appointed to solve the case by the mutual consent of disputing parties. The decision or award
of the third party is binding and final and have to follow by the parties (Findlaw, 2018).
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M4 Compare and contrast the effectiveness of these recommendations.
The alternative dispute resolution process is used by many countries to solve the case. This is
the easy and effective method as compared to the legal solution provided in litigation and
court proceedings. The legal system of both the countries UK and Australia are different with
each other yet the constitution of United States is the highest law.
The similarities are present in the legal system of both the countries which are laws and
regulations are based on state and federal government. The alternative dispute resolution
process is used to solve the issues in which arbitration and mediation are considered as the
best method in this modern way to solve the case. The parties give full support and
coordination to the neutral person in solving the case in minimum time and at minimum cost.
The process is less expensive than the court proceedings because there is no interference of
court procedures and the case is solved outside the court (British Columbia International
Commercial Arbitration Centre. (2018).
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D2 critically review and evaluate the use of appropriate legal solutions in comparison
with alternative legal advice.
The legal system is considered as the procedure for enforcing and interpreting the law. It
describes the responsibilities and rights of the employees and employers and general public in
the society. The legal system deals with civil law, religious law and common law. Legal
system has a different approach to respect f the justice, equity, contract law, company,
environment law and many other laws. There is a basic purpose of the law is protect the
rights and powers of individual. The court proceedings are the old and traditional concept to
solve the case, at present level also there is a number of cases are running in the court
because of its loyalty and reliability in front of the people (Hierarchy, 2018).
On the other hand, it is determined that generally, people are moving towards the alternative
dispute resolution process in solving the case. There are many methods in this concept. In
which arbitration and mediation are the best methods for easy disposal of the case. The cost
of such methods is less than the litigation process as well as less time taken. It is easy due to
full support is received by the disputing parties with cooperation and coordination with each
other (British Columbia International Commercial Arbitration Centre. (2018).
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Conclusion
It is concluded from the whole assignment that English legal system is the basis of any other
laws of different countries. The common law and statutory law are considered as the
important source of the legal system. The civil law, criminal law and religious law are the
most important one which is used in all case of business disputes. The principles of company
law, contract law and employment law are basically used in the business organisation who
deals with contracts, the relationship between employer and employee, establishing a
company and its registration. Legal solutions are provided to solve the disputes in the matter
of termination of contracts, rescuing from liquidation and insolvency of companies,
application of the corporate law in making companies. It is justified that legal solutions of the
country will make both positive and negative impact on the business organisations. There are
several alternative dispute resolution process is considered to solve the matter other than
litigation proceedings are more important and effective in terms of the cost and time.
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