Business Law: Understanding Legal Systems and Solutions

This comprehensive guide explores the intricacies of the English legal system, focusing on its impact on businesses. It delves into the sources of law, the role of government in law-making, and the application of statutory and common law in justice courts. The guide further examines the potential impact of company, employment, and contract law on businesses, providing specific examples and analyzing the implications of regulations, legislation, and standards. It also suggests appropriate legal solutions for business problems such as termination of contracts, rescue from insolvency, and liquidation, justifying the use of these solutions and assessing their positive and negative impacts. The guide concludes by comparing and contrasting the effectiveness of legal solutions with alternative legal advice, such as alternative dispute resolution (ADR) methods like arbitration, mediation, negotiation, and conciliation.

Business Law
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Table of 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...............................................................................6
M1 Evaluate the effectiveness of the legal system in terms of recent reforms and
developments..............................................................................................................7
LO2 Illustrate the potential impact of the law on a business..........................................8
P3 Using specific examples illustrate how company, employment and contract law
has a potential impact upon business.........................................................................8
M2 Differentiate and analyze the potential impacts of regulations, legislation and
standards..................................................................................................................10
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.
..................................................................................................................................11
Section 2 – Legal solutions to business problems..........................................................12
LO3 Suggest appropriate legal solutions to business problems..................................12
P4 Suggest appropriate legal solutions for a range of business problems e.g.
termination of contract, rescue from insolvency and liquidation...............................12
P5 Provide justifications for the use of appropriate legal solutions..........................14
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M3 Assess the positive and negative impacts of legal solutions to business
problems...................................................................................................................15
LO4 Recommend appropriate legal solutions based upon alternative legal advice
provided........................................................................................................................16
P6 Recommend legal solutions based upon a different country’s legal system
and/or a different legal framework............................................................................16
M4 Compare and contrast the effectiveness of these recommendations................17
D2 Critically review and evaluate the use of appropriate legal solutions in
comparison with alternative legal advice..................................................................18
Conclusion.......................................................................................................................19
Reference........................................................................................................................20
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Introduction
The effective legal system is established with a view to regulate and control the
practices in the business environment of the United Kingdom. The effective legal
system requires effective laws which are derived from a number of sources in the U.K.
by chief authorities. This assignment includes various laws, the provision of which is to
be satisfied by the management of the company. Different case scenarios are provided
in the assignment, the solution to which is to be provided in accordance with the laws
operating in the United Kingdom. For solving issues between the parties, alternate
methods can also be adopted which are termed as Alternative Dispute Resolution.
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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, in the U.K, a speech is delivered by the U.K.s queen from the throne of one
of the houses of the Parliament i.e. the House of Lords. This speech is delivered for
explaining the operating and functional activities of the chief authorities of the nation i.e.
the Parliament and the Government (Sparrow, 2015). Moreover, the plans and the
strategies of the authorities for the coming session are also exchanged with the
audience of this speech.
Parliament is Sovereignty: In the U.K., all the laws and the acts are passed or enacted
by the consent of the Parliament i.e. both its houses. These laws and acts are to be
followed by the all residents of the nation and the organisation which is operating its
business in under the legal system of the nation (Gordon, 2015). Any orders made or
laws formulated by the Parliament cannot be challenged in any court or tribunals.
Sources of law
It is essential that an effective legal system is established in order to regulate or control
the unlawful activities of the society of the nation. For establishing an effective legal
system, effective laws are to be made by the legal authorities covering every legal
aspect so that nothing is uncovered. With the view to this, authorities consider different
sources of law which are given below:
Precedents: It is one of the most frequently used sources for developing the law in this
legal system. These are the judgment or the decision given by the authorised legal
bodies i.e. the court in the past times. If any of the similar cases happens in current
time, then the courts can refer to such decision for providing the solution to the issues
(Rab, 2018). Now a day, these decisions are the part of the law reports which are
printed from time to time having recent cases with high influence on the legal system.
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Acts of Parliament: It is considered as the laws itself. Parliament being the chief
authority in this legal system is responsible for overseeing the draft being present before
it. If the draft deems fit then it is approved otherwise it is rejected. Once approved, it is
applicable on every resident of the country and not complying with the law will attract
consequences.
Decisions of international and European Courts are also as the sources of laws and are
considered by the authorities.
International Court is a body which is responsible for dealing with international issues
falling within the legal system of the different nation. The establishment of this court is
the result of an arrangement between various nations (Law Shelf, 2012).
European Court holds a significant place in this legal system and it is responsible for
dealing with the cases attracting European Union laws.
Different personnel are responsible for providing the services of law and working under
this legal system who are as follows:
Those professionals who provide the services of law by working with organisations,
firms, etc. and also prepare the legal documents are known as Solicitors.
Those professionals who are basically known as lawyers and present before the court
to represent their clients are known as Barristers (Hollins and Sinason, 2018).
Those professionals having expert knowledge about the law and are responsible for
making legal interpretation of the norms or laws and providing verdicts based on such
laws are known as Judges.
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P2 Explain the role of government in law-making and how statutory and common
law is applied in the justice courts
For being an effective legal system, it is essential that its laws are effective as well. As
the process of deriving laws is a significant process, it includes certain stages. These
stages are as follows:
Bill of the acts is drafted by the Government based in the requirement of the laws. Then
such bill is submitted to the chief authority of the U.K. i.e. the Parliament (Clayton,
2015).
At first general reading, is done by the Parliament, of the draft which is termed as first
reading which is followed by second reading in which such bill is properly reviewed in
the House of Commons. If needed, the committee is constituted in this regards and the
changes are reported by the committee to the House.
After this final reading of the bill is conducted and is forwarded to the House of Lords.
The process of reviewing the bill is the same in House of Lords as it is in the House of
Commons. For making such draft an act, it is to be approved by both the Houses.
After Houses approves the draft, the assent of the Monarch is also required and same
must be notified in Official Gazette (Open Learn, 2018).
Applicability of the Common and Statutory Law
In the U.K., the court operates on the provisions of commons and statutes and the
decisions are made accordingly. Interpretation or clarification in the law is provided by
the common law and all the applicable laws are arranged in a systematic manner by the
statutes law. With the help of the common laws, Statutes laws are also updated from
time to time and both the complements each other.
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M1 Evaluate the effectiveness of the legal system in terms of recent reforms and
developments
For maintaining the effectiveness of law and the legal system, it is necessary that the
changes or reforms are made in the legal framework. These reforms took place in the
last fifteen years, there were certain changes in the institutions and other bodies are
made. Certain institutions like Ministry of Justice was established which replaced the
Department of the Current Affairs, the establishment of the Supreme Court which
overtook the functions of House of Lords (Faúndez, 2016). Due to technological
upgradation, digitalisation has also been implemented in the legal system of the U.K. as
virtual courts are set up and the proceedings in such courts are done with the help of
internet. Legal practitioners also have the option to update the system with the
documents related to the respective case.
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LO2 Illustrate the potential impact of the law on a business
P3 Using specific examples illustrate how company, employment and contract
law has a potential impact upon business.
Health and Safety Regulations
Human Resources are considered the most significant resources of the company. All
the operating and functional activities are performed by the workforce of the company
and they are responsible for accomplishing the objectives or goals set by the
management of the company. At the same time, the management of the company is
also responsible for taking care of the human resources and about their health and
safety. Certain acts and rules are enacted in this regards in order to make sure that
adequate working environment is available for the workforce of the company along with
certain safety measures and precautions were taken at the place of employment (Boyle,
2015). Health and Safety at Work Act, 1974 makes sure that certain steps are taken
by the management of the company which ensures the health and safety of the
workforce of the company. Not complying with the provisions of such act will draw
punishment under the law.
Equal Opportunities Regulations
In accordance with human rights provided under the law, equality will be provided to
each and every resident of the world. This gives rise to the equality at the place of work.
The enactment of the Equality Act, 2010 makes sure that no act of the discrimination
takes place at the workplace. Discrimination can be of a different type such as
discrimination of gender, belief, religion, color, caste, disability, etc (Donald, et. al.,
2012). No act of discrimination must take place at the employment and it is prohibited
under the law. There must be a proper arrangement made by the management of the
company or by the principal for the disabled employee.
General Data Protection Regulations (GDPR)
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Data holds a significant place in the success and growth of the company and it is
necessary that the company’s data must be provided a safeguard. With the view to this,
GDPR (General Data Protection Regulations) is formulated which overtook the
functions of the U.K. Data Protection Act, 1998. This act provides the individuals the
right to exercise regulations over the collection, utilisation, and storage of data. It also
includes that the personal data of the workforce of the organisation must be properly
stored and must not be accessed without any reasonable cause (Gov.UK 2018).
Compliance with these regulations provides improved security for data and information,
improvement in the image and goodwill of the company.
These are some of the laws which are to be followed by JPM Publishing, once it is
converted into a Public Company.
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M2 Differentiate and analyze the potential impacts of regulations, legislation and
standards.
There are different norms which are categorised under the different names such as
regulations, legislation and the standards. Legislations are norms which are formulated
and developed by the Parliament of the nation. All the laws are made by the Parliament
and are discussed in both the houses of the Parliament (Focus, 2018). Regulations are
considered as the guide which includes that how all the norms of the laws will work and
will be enforced. Standards are the supporting rules which provide helps in the
implementation of the laws made. It provides details and proper clarity that what are the
benchmarks which are required to be achieved in order to meet with the requirement of
the law.
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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 legal system of the U.K. is based on the codified, unwritten constitution, the prime
authority of which is the Parliament as it is responsible for deriving the laws as well as
amending them. Common and Statutes laws are followed by the court while making a
decision. In this legal system, the head of all the courts and tribunals is Supreme Court,
the divisions of which are to be followed by all tribunals and courts (Arden, 2016).
Sources like precedents/ case laws, acts of Parliament; etc is referred to while
formulating the laws so that it can be applied in the nation effectively.
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Section 2 – Legal solutions to business problems
LO3 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
Case 1
Issue
It has been asked by the company, Champion Ltd. that whether there is any right
available with the creditors for suing the company for non-payment of debts.
Laws Applicable
It is well established that in order to run a company, certain laws are to be complied by
the management of the company. This is done with the view to encourage the adoption
of legal and lawful practices in the business environment. The provisions of the
Insolvency Act, 1986 and Companies Act, 2006 is applicable as per facts and issues
of the case. In accordance with the provisions of the acts mentioned above, in case of
non-payment to the creditors of their debts, then a case can be filed for winding up of
the company for making recovery of the debts of the creditors. Before applying to the
court, it is specified that intimation to the company must be provided for the same and it
must also be stated that if payment is not made within the specified time then they will
move to the court for winding up (Johns, 2017). After filing the case, the court will
approve or disapprove of the winding up. If the court is in favor of winding up then a
liquidator will be appointed for handling the winding up process. In this process, debts of
the creditors will be paid after the assets of the company are realised.
Recommendation
It is recommended based on the provisions of the applicable laws that the company
must make payment of the debts on time as specified in the notice served by the
creditors, otherwise, company has to face the legal consequences.
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Case 2
Issue
Whether the company can file a case in the court against the CFO, Mr. Anderson and
for getting the order of injunction against him.
Laws Applicable
It is essential that before getting into an arrangement, a legal written document must be
made by the parties which specify the terms decided between the parties. In
accordance with facts of the given cases, the provision of Employment Rights Act,
1996 and Contracts (Applicable Law) Act, 1990 will be followed. As per the provisions
of the acts mentioned above, the time period is stated in order to resign or remove the
employees from employment. Moreover, such time is also specified in the contract
made between the company and Mr. Anderson i.e. 12 months notice is to be given by
either party to remove or resign from the current position (Taylor, and Emir, 2015). In
the contract act, it is also stated that both the parties must satisfy the terms of the
contract and if such terms are not satisfied then it will be considered as a breach of
contract. The case of Cavenagh v William Evans Limited [2012] EWCA Civ 697 is an
example of not satisfying the terms which resulted in a breach of contract (Marson,
2014).
Recommendation
It is recommended that the parties to the employment contract i.e., Mr. Anderson and
Amber Ltd. must satisfy the terms of the contract. Non-compliance with terms gives the
company a right to file against its CFO and obtain injunction order.
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P5 Provide justifications for the use of appropriate legal solutions
Case 1
In the given case of Champion Ltd., the company is not able to make payment of its due
liabilities as it moved from one place to another and lost its customers. Due to this, the
company is in financial issues and is unable to meet its liabilities. The creditors of the
company have threatened to file against the company its liquidation with the view to
recover the due money (Doyle and Keay, 2016). As per provision of acts mentioned
above, the case against the company can be filed for winding up if payment to the
creditors is not made. Voluntarily, the company can also apply to the court for winding
up, if it believes that it won’t be able to recover from the bad financial process. In this,
liquidator, for handling the activities of winding up, is appointed. Mann V Goldstein is a
case based on the non-payment of the liabilities.
Case 2
In the given case of Amber Ltd., Mr. Anderson failed to satisfy the terms of the
employment contract with the company. In accordance with the acts mentioned above,
it is specified that the terms of the contract are to be satisfied by the parties in order to
ensure its performance and to avoid legal penalties (Cartwright, 2016). As specified in
the contract, Mr. Anderson was unable to serve 12 months notice to the company. It
ultimately results in a breach of contract and the case of Hershaw & Ors v Sheffield
City Council UKEAT/0033/14/ BA is its example.
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M3 Assess the positive and negative impacts of legal solutions to business
problems.
It is understood that the legal solution provided as per the applicable laws have both
positive and negative impact which are as follows:
Positive Impact
 It provides the insight of to the parties about the importance of the law and the
legal system under which they are legally bounded to each other.
 This will allow the individuals or the organisations to work as per the applicable
laws and proper justice will be served.
Negative Impact
 As the penalties are monetary and high, this creates a burden on the financial
pressure on the company.
 Complying with the different laws is difficult for the organisation it requires a high
level of involvement of the management.
 There are various loopholes which are used by the organisation for taking
advantage.
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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.
In the case of Amber Ltd, the issues can be solved by different methods which are
alternative to the litigation system. Such methods are termed as Alternative Dispute
Resolution. These are the method in which the third party is appointed by the parties
having problems in the arrangement and such party provides a solution to the problem.
It includes arbitration, mediation, negotiation, and conciliation.
Different Institutes and authorised bodies are established in other countries as well. For
example, the Maritime Arbitration Commission is an institute providing the services of
ADRs in Russia. However, the process of ADRs in Russia is similar to that of the United
Kingdom.
Arbitration is an option third party i.e. Arbitrator is chosen in order to solve the
problem(s) of the parties so that the relationship between the parties can be maintained
(Merkin and Flannery, 2014). The proceedings of Arbitration are conducted in
accordance with the provisions of the Arbitration Act, 1996.
Mediation is an option in which third party i.e. Mediator is selected by the parties so
that their problem can be solved (Lovan, et. al., 2017). Mediator, instead of the
complying with the rules, if any, applicable, focuses on solving the problems.
A negotiation is an option in which, by themselves or through their advocates, amend
the terms and conditions of the contract in order to ensure future professional
relationship.
A conciliation is an option in which, conciliator is appointed by the parties having
trouble with the view to serve them with a solution by listening to their part separately
and together.
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M4 Compare and contrast the effectiveness of these recommendations
A comparison is made between two of the recommendation mentioned above and
which is related to the provided case.
Arbitration Mediation
In arbitration, a third party, i.e. the
arbitrator is contacted by the parties with
the view that such person will solve the
issues and the parties will be able to
maintain their professional relationship.
(Dragos and Neamtu, 2014).
In Mediation, the person selected by the
parties makes sure that such solution must
be provided to the parties by which they
reach to a mutually agreed arrangement
(Menkel-Meadow, 2017).
In this method, the arbitrator is appointed. In this method, the mediator is appointed.
Parties to the dispute are required to follow
the decision of the arbitrator.
There is no such requirement i.e. it is on
the parties to dispute whether to follow the
decision or not.
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D2 Critically review and evaluate the use of appropriate legal solutions in
comparison with alternative legal advice.
There are various methods of resolving a dispute and in the given cases, Amber Ltd
have the options to file against Mr. Anderson in the court i.e. can file with the litigation
system. However, the disputes can also be solved by methods of ADRs. Proceeding in
the litigation system takes time and requires a lot of investment of the money as well as
patience (Blake, et. al., 2016). Whereas resolving the method by way of the Alternative
Dispute Resolution provides quick redressal of the issues and the charges of these
services as low as well. Moreover, the focus of these methods is on resolving the issues
rather than following the guidelines and the control in ADRs remains in the hand of the
parties whereas, in litigation system, the court and the judges have whole control.
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Conclusion
From the study and the analysis of the English Legal System, it is concluded that laws
and the legal system hold a significant place in overseeing or monitoring the practices of
the company in the business environment which may influence the development and
growth of the nation. Parliament is the chief authority which formulates laws with the
assistance of the Government. The company is required to comply with Employment
Law, Equality Laws, etc. Provisions of applicable laws are applied in order to solve the
given case scenarios. However, such cases can be resolved quickly by Alternative
Dispute Resolution.
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