Business Law: Understanding Legal Systems and Solutions

Business Law
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Contents
Introduction...................................................................................................................... 3
Section 1– Nature of legal systems and legislations impacting businesses.....................4
LO1 Explain the basic nature of the legal system.........................................................4
P1 Explain different sources of law and laws that organizations must comply with.. 4
P2 Explain the role of government in law-making and how statutory and common
law is applied in the justice courts.............................................................................5
M1 Evaluate the effectiveness of the legal system in terms of recent reforms and
developments............................................................................................................6
LO2 Illustrate the potential impact of the law on a business.........................................7
P3 Using specific examples illustrate how company, employment and contract law
has a potential impact upon business.......................................................................7
M2 Differentiate and analyze the potential impacts of regulations, legislation and
standards.................................................................................................................. 8
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.
.................................................................................................................................. 9
Section 2 – Legal solutions to business problems.........................................................10
LO3 Suggest appropriate legal solutions to business problems.................................10
P4 Suggest appropriate legal solutions for a range of business problems e.g.
termination of contract, rescue from insolvency and liquidation..............................10
P5 Provide justifications for the use of appropriate legal solutions.........................11
M3 Assess the positive and negative impacts of legal solutions to business
problems................................................................................................................. 12
LO4 Recommend appropriate legal solutions based upon alternative legal advice
provided......................................................................................................................13
P6 Recommend legal solutions based upon a different country’s legal system
and/or a different legal framework...........................................................................13
M4 Compare and contrast the effectiveness of these recommendations...............14
D2 Critically review and evaluate the use of appropriate legal solutions in
comparison with alternative legal advice.................................................................15
Conclusion..................................................................................................................... 16
References.....................................................................................................................17
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Introduction
Laws are important for any society, community or organization as it sets fundamentals
for their conduct. It also provides proper order and guidelines upon behaviour expected
from citizens and to sustain equity. It keeps the society running. In this report, the
sources from where such laws are emerged have been discussed. The English Legal
System is a centralized structure which is applicable on whole country. This report is
highlighting the laws applicable on businesses under English Legal System. The
application of laws on business is important as it can shape their conduct positively and
makes them aware of their duties and responsibilities. Various laws applicable on
organizations such as Companies Act, Health and safety Act, Insolvency Act, Contract
Act have been discussed.
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Section 1– Nature of legal systems and legislations impacting businesses
LO1 Explain the basic nature of the legal system
P1 Explain different sources of law and laws that organizations must comply with
“Every year the government announces its programme for legislation by way of the
Queen’s Speech at the State Opening of Parliament in October or November.
Therefore, it is commonly said that ‘Parliament is sovereign’.”
This statement is relevant in light of facts that every year an event is held in month of
November in front of both houses of Parliament. The Parliament has two houses
namely House of Lords and House of Commons. During this event, the Queen
delivers a speech on agenda of government for the coming session known as Queen’s
Speech. This event is called State Opening of Parliament. This speech is delivered by
Queen from the throne in House of Lords (Sparrow, 2015).
Sources of Law
The English Legal System is based on laws from mainly three sources. These are as
follows:
 Legislation: These are the laws which are enacted by Parliament as an Act.
This is the main source of law. Parliament is the supreme law-making authority in
UK. A set of procedures is followed in both Houses of Parliament for enactment
of laws. The procedure starts with Bills and ends as an Act (Morgan, 2018).
 Common Law: These are the laws created in courts by judges. Courts can use
their expertise and knowledge for interpretation of statutes. Such interpretation
becomes law when the statute requires clarifications in various circumstances
known as common law.
 European Union (EU) Laws: UK is a member of European Union. The members
of European Union are required to follow the laws of European Union. Therefore,
UK is required to comply with laws of European Union. EU laws are precedents
over UK laws.
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Laws Applicable on an Organization
 Companies Act, 2006: Companies in UK must comply with the provisions of
Companies Act, 2006. This Act defines the procedures of incorporation, duties
and responsibilities required to be fulfilled by directors and managers and all
other provisions relating to companies.
 Finance Act: This Act outlines the provisions relating to Finance. This Act is
applicable on all organizations irrespective of their sector, field of operations or
nature. This Act includes provisions relating to taxation, exemptions available
and many more related matters (Siems, and Deakin, 2014).
 Health and Safety at Work etc. Act, 1974: This Act contains provisions and
procedures that an employer is required to follow for ensuring safety and good
health of its employees and other persons at workplace.
 Contracts (Applicable Law) Act, 1990: This Act is applicable on contracts and
agreements. It provides for the rights available to the parties and protects their
rights in case any party commits breach of contract.
Fig. 1: Sources of Law
Source: (University of Portsmouth, 2012)
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