Business Law: Understanding the Legal System and its Impact on Businesses

Business Law
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Contents
Introduction...........................................................................................................................................3
LO1 Explain the basic nature of the legal system..................................................................................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 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.....8
LO2 Illustrate the potential impact of the law on a business..................................................................9
P3 Using specific examples illustrate how company, employment and contract law has a potential
impact upon business.........................................................................................................................9
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
LO3 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...........................................................................................13
P5 Provide justifications for the use of appropriate legal solutions.................................................14
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
References...........................................................................................................................................20
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Introduction
Knowledge about business laws can help the businessmen and managers in sound decision-
making. In the democracy like that of UK, having an effective legal system is mere necessity.
Talking about the English legal system, it ensures that justice should be accessible to both
poor and rich people. There are innumerable laws that apply to the business world. These
laws help in defining the ethical deeds, providing stability and discarding some uncertainties.
In addition to this, they can serve in resolving the disputes. This report basically targets four
key aspects of business laws. In the first section, it talks about the nature of the English legal
system and legislation that influence the organisation in the UK. It elaborates the process of
law-making in the UK and differentiates between the common law and statutory laws.
Second section explains various important business laws in context of given business
scenario. Moreover, the potential effects of the law on an organisation are also assessed. In
the last section, certain legal solutions and advices are given in context of the provided case
studies.
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LO1 Explain the basic nature of the legal system
P1 Explain different sources of law and laws that organisations must comply with.
a) Discus the meaning of this statement and the various sources of UK Laws
The sentence “UK’s Parliament is sovereign” means that the parliament is the supreme legal
authority in the UK. The parliament sovereignty is the key principle of the UK constitution
that provides the Parliament the power to form or end any law. Even the judicial bodies like
the Supreme Court cannot overrule the decisions of the Parliament. Moreover, no Parliament
has the right to form laws that future parliament cannot amend. Parliament sovereignty is the
most significant element of the UK constitution. The constitution of the UK is partially
written and completely un-codified. Therefore, the Parliament enjoys limitless powers. There
are certain laws passed by the Parliament itself that limits the implementation of
parliamentary sovereignty (Bubb, 2014). These laws are mentioned below:
 Human Rights Act, 1998
 Joining the European Union in 1973
 The decision to form the UK Supreme Court that ended the House of Lords functions
as the highest judicial body.
Various Sources of Law
There are two prime sources of laws, namely primary sources and secondary sources that can
be further divided into sub-sources.
Primary sources: These are the first hand and original source of information. These are
explained below:-
 Precedents: These are the common-law doctrine that is based on the previous
decisions of courts that are usually cited by the courts of lower or same level. The
reference is only taken when the disputes or issues are identical to some previous
case.
 Customs: These laws are established and verified by a particular community or
society setting. Mostly, these laws deal with certain community’s standards that were
set by people in the past (Bubb, 2014).
 European Laws: These laws are established by the member states of EU. These are
established by the Court of Justice and every member of the EU has unanimously
agreed to follow them. These laws can overrule the UK’s statutory laws.
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 Legislations: These are also called statutory laws and are created by the Parliament of
the UK. These are applicable to every citizen of the UK (Cotterrell, 2017).
 International Laws: These laws are established by some International bodies, such
as WHO, UNESCO, UNICEF, etc. These laws are usually regarded and accepted by
the member nations.
Secondary Sources: These consists of magazines, books, journals, and newspapers that
usually consist of some articles specifically based on laws, Acts, regulations, and legislations.
These are the best references to start any research. They provide the basic terminology that
are often used in law suits (Barkan, et.al, 2015). In addition to this, professionals may refer to
related issues and they are easy to understand and read than most of the primary sources.
They usually synthesise the relevant information found in the primary sources.
In the English legal system, there are three terms that often create confusion among the
citizens: the barrister, the solicitor, and the judge. There is a significant difference in the roles
of the three different people in the legal system.
 Solicitor is said to be a legal professional who handles day-to-day legal issues of their
clients. Most of a time, they try to settle the matter outside the court, but if needed,
they can represent their clients in the courtroom.
 Barristers are the legal professional who spends most of their time in the court
resolving the daily legal matters of their clients. Barristers are usually guided by the
solicitor in handling the lawsuit.
 The job of the judges is to hear the arguments of solicitors or barristers. They have to
act neutral while making the decisions on the case. They are responsible to assess the
credibility of the evidences and then order the ruling on the matter.
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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.
The constitution of the UK is partially written. Therefore, several legislation are created by
the Parliament of the UK. The law-making process depends on the two crucial bodies: 1) The
House of Commons and 2) The House of Lords. The government is elected by people of
the UK after every five years and the chosen candidates represent the House of Commons.
The government tries to maintain the law and order in the region (Barkan, et.al, 2015).
Therefore, it attempts to attend to different issues and challenges that the country is facing.
The issues may arise from the campaigning by nationals, special interest group, minorities,
etc. To resolve the issue, the selected government proposes a bill in the Parliament. The
debate takes place between the government and the opposition parties. Once the bill is
approved in the Parliament, it is sent to the House of Lords.
The House of Lords is the Supreme Court. The court re-evaluates the bill and if needed, it
may suggest some changes in the bill. Once the evaluation is done, the bill is sent back to the
House of Commons again to make the suggested changes.
Once the amendments are done, the bill is sent back to the monarch i.e., the Queen. In the
constitution of the UK, some powers are given to the Queen that includes the power to
approve the bill. Every bill has to be approved by the Queen (Royal Consent). Once the bill
is approved by the Queen, it will be gazetted and the Act is passed (Cotterrell, 2017).
A brief of the law-making is explained below:-
 An issue emerges on the government’s manifesto.
 Subject experts are contacted.
 Cabinet ministers formulate the proposal
 Proposals are reshaped into bills.
 Parties debate on the proposed bill
 Parliamentary stages comprise First reading, Second Reading, Committee stage,
Report Stage, Third Reading.
 A bill is passed
 A bill is transformed into an Act
 The judicial laws are made under the act.
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