Legal System and Contract Law: A Comprehensive Guide

This comprehensive guide provides insights into the legal system, contract law, and different types of business structures. Learn about the role of government in law making and find appropriate legal solutions for resolving disputes. Perfect for students studying business law.

Business Law
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Table of Contents
INTRODUCTION...........................................................................................................................3
LO 1.................................................................................................................................................3
What constitutes legal system......................................................................................................3
LO 2.................................................................................................................................................4
Contract law and elements and terms of contract........................................................................4
LO 3.................................................................................................................................................6
Unincorporated and incorporated legal structure........................................................................6
LO 4.................................................................................................................................................8
Appropriate legal solutions to resolve areas of disputes.............................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11
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INTRODUCTION
In every country there is a proper legal framework and structure which is formulated. This
consists of various laws, acts and regulation which needs to be adhered by people as well as
companies. The government is responsible for formulating and maintaining of legal system. The
system varies from country to country. However, there are different types of courts as well in it.
Besides that, laws are also adhered by business (Ünal,, Urbinati, and Chiaroni, 2019 ).
The report will lay emphasis of different sources of law. Also, it will discuss role of
government in law making. furthermore, it will be described about company, employment and
contract law and different types of business that can be legally formed. At last legal
recommendation will be given for several case studies.
LO 1
What constitutes legal system
It is basically set of rules which is formed by government to regulate actions of people. it
include institution, procedure, etc
Purpose of law
There are generally 4 purpose of law that is to maintain law and order, establish
standards, protect liberties and resolve disputes.
Different source of law
In legal system there are various laws and regulations included. They are enforced on
business and people. it reflect that how laws are governed by government. Basically, in UK legal
system in divided into 3 that is federal, state and local. The laws are formed by federal and
implied by state and local. Moreover, there are various sources of law which is as:
Constitutional- it is highest level of law applied within country (Peterson, 2019). The law is
applicable for every citizen. In this it protect rights of people. the purpose is to secure and
protect public place, etc. the government enforce this law in nation. For example- there is
specific dress to be wear in schools. It serves as main pillar of law on basis of which all other
laws are formed and applied.
Statutory- this is second source of law that is applicable to business and people. Here, there are
many statues described in it. thus, it specifies criminal activity into penal bar and other
government branch.
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Case- it is law that is applicable into criminal activities. All people who belong to this
profession has to be follow case law. Along with that, the decisions taken are also based on it.
In UK this law is formed by English common system. The code of conduct is enacted by
legislation and contains various principles that court follows.
Key terminology of legal system
Tribunals- they are courts in that deals with decision on immigration, crime and other cases.
County court- the national court where decision is taken by circuit judge (Patra, 2020).
Court structure- It is structure of courts in UK that is crown , high and supreme court.
There is difference between criminal and case law that is discussed as below
In criminal law the activities of crime is defined at state and federal level. Moreover,
defendant is found to be guilty or acquitted. The legal penalty given is fine or probation. But on
other hand, case law deal with individual rights when they are violated. So, it require proof in it
against plaintiff. The penalty is given in terms of finance.
Role of government in law making
In every nation government play significant role in law making. they also govern and
maintain laws and regulation in country. They make several bills which is draft of law. In this
various acts and regulation are written which is implied in law. Besides that, government is
having power to make and withdraw law. They take decisions as per situation and decide what
type of law whether state or federal needs to be formed. Alongside, local and state government
is also involved in law making. They pass bill into parliament to make it a law. In addition, in
legal the role of government is defined in law making.
Also, it is found that government discuss with parliament committee regarding law
making. The ministers who are representative of government is responsible for passing bill.
Moreover, government is responsible for implying of law as well within country. Besides they
also regulate and monitor law at federal and state level and take decision on what measure or
changes is to be required in it (Laukkanen, and Tura, 2020).
LO 2
Contract law and elements and terms of contract
In UK English contract law is followed in which there are 3 elements in it that is
agreement, mutual intention and consideration. The law is governed by England and Wales in
UK. A contract is formed by considering the 3 elements in it. However, terms of contract are
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Offer
Acceptance
Consideration
Agreement
Impact of company employment and contract law on organization
An organization is required to follow all laws and regulations in whatever nation they
operate. They need to work in legal way by following of many policies and standards. In
addition, the regulation is formed by government and it differs in countries. However, there are
many law that need to be adhered by organization as well. In this it include several policies and
acts. The violation of law by business may results in taking legal action. So, laws are defined as
Company act- this is law followed by all organization in UK. It was formed in 2006 and set
accountability of firm towards stakeholder. in this rights of business are mentioned along with
staff rights. The staff is responsible for their duty and rights. Moreover, director rights are
defined as well in it and it prohibit to leak any confidential info. The business needs to be
registered under this act. This is legal proof to operate in UK (Kaushik, and Rajput, 2020 ).
Health and safety – this act is related to health and safety of employees. It was formed in 1974
and contain many measures and standards which organization has to be followed. furthermore,
act state certain tools and equipments which needs to be equipped and implemented at work
place. This impact business as if they do not follow it then legal action is taken.
Contract law- Basically, it is contract done by two or more than two parties in regard of
exchange of services. There are certain terms and condition mentioned in it which needs to be
followed by each party. If business terminate contract then it impact as legal action is taken
against it.
Copyright law – the act consists of copyright patent. Thus, business has to be follow specific
procedure to make sure its product or service is legally copyrighted. It impact as not following
this leads to illegal practices.
Data protection- The law state that organization need to protect data and info of consumers. The
data must not be shared with any other parties.
Duties of employer and employee
Employment contract- it is a contract which specifies relationship between employee and
employer. In this duties and rights of both of them are defined along with accountability of
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business towards staff. This is in regard with salary, working hours, etc. thus act impact on as
organization has to ensure their accountability. If not followed then legal action is taken
(Figueiredo and et.al., 2019).
Employer obligations
The business are having some obligations such as ensuring safe work environment, giving equal
opportunity, minimum wage act etc. these all has to be followed by business.
Employee rights
In addition to above employee are having some rights such as right to safe workplace, right to
free from discrimination, etc. they have to follow these rights.
LO 3
Unincorporated and incorporated legal structure
In this the difference is shown below
Unincorporated Incorporated
The member can take liability against group In this individual liability is limited
They can not enter into contracts They can enter into contract
They are not regulated or governed by any
legal body
They are regulated or governed by legal body
Different types of business legal formed
Business refers to legal entity which provide various products and services. There are
different types business that can be formed and operated in legal way. The size and scope of it
varies from one another (Alvarez, 2019). It is important to register business legally. Thus, it is as
follow
Sole proprietorship- It is a type of business in which business is owned by single owner. The
person is responsible for managing of entire business and taking decision. The profit earned is
received by owner. It is easy to set up legally this business. There is unlimited liability in it.
Also, it is easy and less costly to set up business.
Partnership – In this there are two or more than two persons involved in business. There is
agreement done between them on basis of partnership act. Alongside, in agreement it is written
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how decision are made, profit is shared, etc. in addition, profit is shared on basis of agreement or
investment made into business. The liability of partner is limited in it.
Classification of companies
Private company – It is a business started by group of people for common objective. it is having
legal existence from others. The company is registered by share of stocks. in this liability of
stakeholder is limited. Moreover, stakeholder elect BOD who form goals and objectives. Private
company does not dissolve when ownership changes (KOLDOWSKI, LAWS,. and XAVIER,
2020).
Limited liability company – This type of business is having feature of both partnership and
company. They are not incorporated as owner is having limited liability. It can be either a sole
proprietorship, partnership etc.
Unlimited liability company – it involve partners who are equally responsible for debt and
liability. In this liability of partner can exceed with the investments made.
Public company- they are those companies that is formed and regulated by government under
company law.. The purpose is to serve public and its shares can not be traded or sold to public.
Starting business organization and registration requirements
Here, first requirement is having a defined structure in it. Then, tax id number is required
along with license. At last a bank account is required to register business.
Management of company
The management included BOD, managers, staff, etc who are part of company. Also, it
consists of company secretary, auditor who manages it. Stakeholder play vital role as they
provide data and info to them. Besides that, they are also part of management and are involved in
decision making as well.
Raising capital
There are many ways through which business can acquire funds. It depends on fund
requirement and type of business. Thus, it is defined as below:
Bank loan- It is common source of acquiring funds. Here, bank gives loan to business on fixed
interest rate for particular time period. But firm has to submit collateral deposit for that.
Financial institutions – they are those institutions which provide funds at high interest rate. It is
easy to acquire funds as no complex process is to be followed in it (KOLDOWSKI, LAWS,. and
XAVIER, 2020).
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Investors – It can be either a group of people or individual who is interest in investing in
business. An agreement is made in it and investors may take equity stake as well. It is easier ti
acquire funds from them.
LO 4
Appropriate legal solutions to resolve areas of disputes
Contract law: A body of law that regulates contract or agreement to obligations which are
enforced by law in UK is known as contract law. It is made when one party offer and other party
accept that offer (Austen-Baker, 2017).
Employment law: A law that regulates relationship between employers and employees and also
governs that what employers expect from employees is known as employment law.
Company law: A body of law that governs rights, relations as well as conduct of companies is
known as company law.
Legal solutions along with justification
In the case of Gordon, it is found that he was employed by Orange computer Ltd and
receives annual salary of £10,000 and commission payments but due to competition and
downfall, owner, Fred asked to Gordon if he will be agree to receive only commission not salary
for 2015, 2016 and 2017 and he agreed on it. In the year of 2016, company started making profit
so, Gordon thought to get salary in 2017. As per the contract and employment law of the UK, all
employees above 19 years are allow and eligible to receive minimum wage as per the national
wage act. It is also important to have agreement in written and if employers make changes in
wages and contract then it should be acceptable by employees. But in this case of Gordon it is
found that agreement made between owner and Gordon orally. So, as per the rights of employees
and contract or employment act 2020, Gordon can seek for his wages (UK: Employment and
Labor Laws and Regulations 2020, 2020.).
In the case of Janet, who wanted to install internet package including phone line and for that she
called to Virgin and company send an engineer but that day engineer did not find phone cable so
he went and never came back. Same day, Janet complained and after 3 weeks, company sent
another engineer but they charged money from the day, Janet complained and send invoice to
company. So, as per the contract law, it can be suggested to Janet that she can get help. As per
the consumer and contract law 2015 of the UK, consumer has rights to reject something that are
faulty and take actions against misbehave, misconduct and unethical acts done by shopkeeper.
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Company owner is liable and responsible to refund money if he found faulty from a reasonable
time to fixed period. Reason of suggesting this act of consumer act is, it has detailed information
and as per the case, she can get justice and refund (Consumer Contracts, 2020).
In the case of Blackhorse limited that is security guard provider, provides
services to other company. But due to bad debt of one creditor of company, Black horse faced
reduction of £100,000. Creditor issued a winding up petition 2 weeks ago so, it is important for
Black horse limited as if it can seek for its money from creditor or not. But for stopping winding
up petition, company can pay off to creditors and persuade the creditor not to advertise petition.
By applying a recession order as per the help of appropriate law, it can be solved out and
company can stop winding up petition (To Stop a Winding Up Petition, 2020).
CONCLUSION
From report it is concluded that legal system contains acts, laws, regulations, etc. and is
known as constitution. In UK there are 2 houses that is house commons and lords. The sources of
law are statutory, case and constitutional. Also, government play vital role as they make bills,
amendments, etc and pass into parliament. Besides they monitor and maintain law and order.
There are many laws followed by business such as copyright, data protection, health and safety,
etc. These highly impact on business. Also, there are various legal types of business such as sole
proprietorship, partnership and companies are public, limited liability, etc. besides that, there are
various sources through funding can be acquired like investors, bank loan, etc.
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REFERENCES
Books and journals
Alvarez, A., 2019. Apple’s App Store: Exploring the Future of Antitrust Laws. FAU
Undergraduate Law Journal, 1, pp.9-9.
Austen-Baker, R., 2017. Implied terms in English contract law. Edward Elgar Publishing.
Figueiredo, R. and et.al., 2019. The role of knowledge intensive business services in economic
development: a bibliometric analysis from Bradford, Lotka and Zipf laws. Gestão &
Produção, 26(4).
Kaushik, N. and Rajput, D., 2020. International Commercial Arbitration: Issues Regarding
Arbitrability. NOLEGEIN-Journal of Corporate & Business Laws, pp.7-24.
KOLDOWSKI, J., LAWS, E. and XAVIER, N.S., 2020. Introduction to The Elephant Tourism
Business. The Elephant Tourism Business, p.1.
Laukkanen, M. and Tura, N., 2020. The potential of sharing economy business models for
sustainable value creation. Journal of Cleaner production, 253, p.120004.
Patra, C., 2020. Avenues of International Commercial Laws. Splint International Journal of
Professionals, 7(2), pp.48-54.
Peterson, J., 2019. 10 Laws of Trust, Expanded Edition: Building the Bonds that make a
Business Great. HarperCollins Leadership.
Ünal, E., Urbinati, A. and Chiaroni, D., 2019. Managerial practices for designing circular
economy business models. Journal of manufacturing technology management.
Online
UK: Employment and Labor Laws and Regulations 2020.2020. [Online]. Available through
<https://iclg.com/practice-areas/employment-and-labour-laws-and-regulations/united-
kingdom>
Consumer Contracts. 2020. [Online]. Available through <
https://www.businesscompanion.info/en/quick-guides/consumer-contracts>
To Stop a Winding Up Petition. 2020. [Online]. Available through <
https://www.companydebt.com/winding-up-petitions/common-defences-winding-
petition/>
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