Business Law: Legal System, Sources, and Role of Government

This document provides an overview of business law, including the legal system, different sources of law, and the role of government in making laws. It discusses key legislation, regulations, and standards that businesses must be aware of. The document also explores different types of business organizations and the funding and management procedures involved. It includes case studies that highlight legal issues and their resolutions.

UNIT- 7: BUSINESS LAW

Table of Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
1. Explanation of legal system and different source with role of government for making law.. 3
2. A critical reflection of legal system........................................................................................5
3) Key legislation, regulation and standards the business must aware.......................................6
4) Different laws which the business had to follow....................................................................6
5) Different types of business organisation.................................................................................6
6) Examining the funding and managed procedure in business..................................................7
PART 2............................................................................................................................................8
CASE 1........................................................................................................................................8
CASE 2........................................................................................................................................9
CASE 3......................................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
Business law refer to the body of law which is specially designed for the business in
respect of attaining smooth running of the company. In context of business, law are imposed to
protect the rights of the parties in respect of entering into any contract or expanding the business
into different market or the major criteria is to protect the rights of the employees in respect of
dealing in any such matters (Business Law and Regulation, 2019). Laws are mainly imposed in
two manner firstly in respect of civil activities in which any civil crime are undertaken and
secondly it is related to criminal activities in which the crime is punishable related to criminal
matters. Thus, present report carries the matters related to business law in which the nature of the
legal system is defined. It also includes the aspects relating to undertaking the potential impact of
the law on the business. It further carries with the aspects which examines the different formation
of the types of business organisation. Lastly the report carries various cases in which the decision
is undertaken in respect of resolving the issue in business.
PART 1
1. Explanation of legal system and different source with role of government for making law.
The different source of laws: in the English legal system various sources of law are
implemented for employee company in order to behave ethically in society.
Common law:
In the common law judgement is taken by judges sitting in court and give decision as per
the last case study. Like Similar case recently referred in court, in that case judge have power to
take decision as per previous case law (Klin and Nachyla, 2015). The legal rules and regulations
are governed with decision of queen which is mentioned in the law such decisions are followed
by the court.
Act of parliament:
A parliament has specific right to make new law and revise in the existing laws in the
rules of law which is help to make the best decision in judgement process. This is also known a
statutory law that is regulated by states. This provides support to public in order to believe in law
and behave well in society. The laws are revise time to time for bring new development in
society.
Role of government in making law:

Government plays an important role in order to make laws. Laws are made by parliament
process but it start from being a draft legislation formed by public authorities of electing parties
who are served with various issues and problems faced by the public (Cosens and et.al., 2017).
These parties are select a matter which has need to framed with the help of government
authorities. In this process required proper approval of cabinet ministers in order to be presented
in parliament. Without permission a proposal cannot proceed.
Application of statutory and common law: Statutory law: This laws are made in UK with the help of parliament and have a solid
applicability over the whole nation. In that court required to interpret laws with the
existing aids but not have right create dispute over the provision (Allen and Blackham,
2018). For example: Lee v Lee air farming 1960, the rules of companies act 1862 present
at the time was used for determining principles of separate legal personality of company.
 Common law: This can applied in justice courts as getting a building effect over decision
of court through doctrine of judicial precedent (Postema, 2019). This application can be
seen in the case of industry V Bottrill 1999 the rulling of case Lee v Lee air farming was
also applied for defining sole trade can be employed by company.

Structure and hierarchy of court in UK
Illustration 1: Hierarchy of civil courts in England
Source: Hierarchy of civil courts in England, 2018
2. A critical reflection of legal system.
The critical evaluation of legal system of law in case of Fred V Gordon, it duty of Fred to
follow the rules and regulation of company and have not any right to terminate Gordon because
legal system have strength reduce possibility of corruption and reflect values. But result saris that
Gordon files case against of Fred that can affect goodwill of company because legal system has
weakness that affect company which is no reasons given for verdict (Bant, 2015). In that
company loss lots of time and money for finish this case. As per employment right act, 1986 it is
the duty of company to take care of their employees in order to fulfil needs so that they are able
to work freely in order to achieve target.

3) Key legislation, regulation and standards the business must aware
Legislation: Legislation refer to the laws which is imposed in business in respect of protecting
the right of the parties in context of dealing in such matters (Cleaveland, Dutcher and Epps,
2015). Thus, laws are imposed in respect of securing the country reputation in respect of
protecting their rights and also helps to build trust in court in respect of getting fair decision
against the rights affected by any illegal activity.
Regulation: After undertaking the laws which is imposed by the country inn respect of securing
the right of the citizen, the laws are regulated in particular task. In respect of business dealing in
any such activity regarding managing the employees, thus employment act is undertaken to
secure the right of the employees.
Standards: It is set in respect of managing the quality and performance of the company. This is
undertaken in respect of minutely examined the overall working strategies and also in respect of
dealing in certain task to achieve such goal in better way (Conley, 2016).
4) Different laws which the business had to follow
In respect of smooth running of the business, it carries various laws such as:
Contract law: Under the contract act, 1919 this law legally bound both the parties to enter into
the agreement and such agreement is valid in respect of parties which had attained the age of
majority and also they are competent to handle the contract in better way (Hansmann and
Kraakman, 2017).
Law of torts: This refer to the law of torts of negligence in which the employer carries the rights
to protect the employee during dealing in any hazardous activity (Erickson, 2018). Thus they had
to carry three aspects such as duty of care, breach in duty, damages faced in working at
hazardous places.
Copyright law: In this law are imposed in respect of protecting the right of the person in respect
of bringing any innovation in respect of literary, artistic work or any musical composition which
is different from others.
Employment law: This laws is established in respect of protecting the relationship between the
employer and employee (Gower.Morley, 2016). It also helps company to maintain proper norms
in respect of securing the right of employees in company.
5) Different types of business organisation
It undertakes various types of business in which they engraved their interest such as:

Sole proprietorship: It is also known as sole trader business. The main advantages of choosing
this business is that it is less risky and the partner itself enjoy all such rights which they gain in
respect of carrying the business at large level (Four Forms of Business Organisation, 2019). The
disadvantages is examined in respect of facing risk in respect of not getting any sources of
funding. As the company not carry any renowned image in market thus they cannot get any help
from banks.
Partnership: In this when two or more person agreed to undertake the single business they enter
into the agreement by signing the partnership deed (Nsubuga, 2019). The advantages of this
business is that the profits are to be shared equally and also the losses are to be incurred equally.
The disadvantages is relating to in case of death of any partner, the partnership is dissolved.
Limited company: In this the members are bound to follow the norms which is mentioned under
the companies Act, 2006. the advantages of this business is that in case of death of any partner
the company will not be dissolved. The disadvantage is that the formation of the company is very
expensive and also carries lot of formalities to establish the business.
6) Examining the funding and managed procedure in business
Sole proprietorship: They manage the business individually and also take helps from other
companies in respect of expanding the business (Willett and Koutsias, 2016). The funds are to be
managed by the person itself or taking helps from the friends in respect of investing or managing
the activities in better way. For e.g. Owner carry the rights to manage the business individually
by undertaking various aspects to manage the smooth running of business.
Limited company: The company is managed by the owner or directors which carry the power to
take decision in favour of the company (Westermann-Behaylo, 2018). The funds are to be
manage through issuing share in market and also offer to public to purchase such share. They can
take loan from banks in respect of dealing in such such task. Example: Banks can easily provide
loan to company in respect of carrying the renowned brand name in market.
Partnership: They are managed by the partner and also funding is stipulated by the partner in
respect of equal sharing. They can also take help from the banks in respect of managing funds.
For e.g. They can manage the funds through raising funds in market and also promote the
business among public to get investment in context of dealing in any such activity.

PART 2
CASE 1
Issue:
In this case study, the issue is identified in respect of not getting wages for the work
committed as company is not capable to manage the salaries of the staff due to facing losses in
working. As the issue is raised between the Gordon V Fred, manager of the Orange computers
Ltd. that company is facing throat competition in local market and due to this aspects they are
facing financial issues. By this aspects they cannot pay salaries to staff in respect of reducing the
firm outgoing procedure. Thus, after getting support from the government in respect of managing
investment, they again balance the company working in better way. Thus, issue arises in respect
of signing the variation contract which is instead by Fred in respect of not having financial
balance. But once the company is financially strong, the demand is raised by Gordon in respect
of getting the wages for the year 2015, 2016.
Rules:
In respect of employment and labour law, 2016 it is mainly designed to maintain the fair
relationship between the employer and employees. As it is the duty of the employer to take care
of employee in respect of working in any hazardous places and also in return it is the duty of the
employees to follow the guidances which is imposed by employer in respect of behaving
ethically at work place. Under the contract act 1919, it is applied in respect when both the parties
enter into the contract regarding dealing in any such activity and such contract is made on the
bases of some consideration amount. The existence of new contract in respect of the existing
contract is relevant to undertaking any variation in contract and this can be undertaken in respect
of mutual agreement between the parties.
In context of Pimlico Plumbers Ltd. V Mr. Smith Case, they are considered to be the
employee of the Pimlico plumber and also liable to enjoy various benefits which is given as the
employees of the company (Pimlico Plumbers Ltd & Mullins v Smith [2018] UKSC 29, 2019).
As the issue which is faced by the Mr. Smith is regarding not undertaking the activities of the
plumber due to facing serious health issue. Thus, in such manner due to court opinion, Pimlico
considered Mr. Smith to be the employee of the company.
Application:

From the above stated case, the judgement is given on the bases of protecting the right of
the employees under the employment rights act 1996. Thus, this case is similar to the given case
of Gordon V Fred in which the right of the Gordon are not fulfilled in respect of not getting fair
wages once the company had settled the business in better way (Yeoh, 2016). In respect of
raising the demand from the Gordon regarding getting the wages for the year 2017 and also for
the 2015 and 2016 as the Gordon is liable to get wages for the 2017 but they not get the payment
for the year 2015 and 2016 due to signing the variation contract. As this is such contract which
is signed with mutual consent between the parties. Thus, in such manner the right of the Gordon
are protected under the employment contract act.
Conclusion:
From the above study, the conclusion is examined as variation contract is mainly signed
by considering the consent of both the parties and thus, it cannot be changed in respect of the
opposite party is also agreed in same perspective. Thus, the right of the Gordon are protected
under the Orange computers Ltd. In respect of getting wages in context of work accomplished in
premises. The contact is also valid as it is signed by both the parties and also they are capable
and competent to handle the matter in right way.
CASE 2
Issue:
In this case, the issue is analysed between the service provider (Virgin media) and the
consumer (Janet) regarding not installing the internet packages timely but the bill is sent for the
whole month usages. As the compliant is raised regarding the not getting the engineer which
install the telephone point to connect the interest packages on the set date and than after sending
so many email or calls, the engineer came after 3 weeks. But the issue is undertaken in respect of
getting the bill for whole month even the internet packages is not yet installed for the first 3
weeks.
Rules:
Under the Contract Act, 1919 it refer to such agreement which is made between the
parties regarding carrying all such term and condition which is mentioned in the agreement. The
parties are bound to follow such terms to make the contract valid (Lee, 2017). The another major
things which is necessary in the contract is relating to enhancing some valuable things with each
other so that they share some bound in respect of enhancing the contract for longer time period.

In respect of the case study of the Louisa Carlill v Carbolic Smoke Balls Company in
which the issue is faced regarding getting rewards to the parties in respect of fulling the specified
task (Carlill v. Carbolic Smoke Ball Co, 2019). Thus, it is the duty of the company to perform
such task in respect of accepting such offer by the Carlill regarding any of the advertisement
which is given by the Carbolic Smoke company.
Application:
This case is relevant to the above case study in which the matter is same as the Consumer
is attracted towards the scheme through advertisement only and after getting satisfied with the
services which is offered by the services provider in respect of installing the internet packages.
She finalised the order and than undertook the procedure to install the internet package. But after
getting the bill of the internet, she shocked to see that the charges are made from the whole
month but the internet is activated after installing the 3 week from the time period. Thus, she find
that there is breach committed in the contract and also the terms are not mentioned in the
contract. Thus, it also give rise to void contract as the terms is violated by the service provider
and also both the party are competent to handle the contract of the contract is made or run with
fair terms.
Conclusion:
Thus, from the above study, the case study concludes the matter in which the parties are
competent to handle the contract in better way in respect of making the valid contract. In this
case study the Janet can file suit against the service provider in respect of committing breach in
the terms mentioned in contract or not providing timely services as decided before taking the
services.
CASE 3
Issue:
The issue is examined in respect of not managing the business in right way as the Black
house limited occurs bad debt of £100,000 which resulting in forcing by the creditors in respect
of winding up of company. The issue is examined in respect of determining the another methods
in which the company can imposed in respect of settlement of any problem faced in company.
Rules:
In respect of Company law, 2006 they are mainly imposed in respect of managing the
overall activity in the company. Under this law, it is mainly imposed in respect of securing the

right of the stakeholder which are engaged with them in respect of undertaking any such activity.
In respect of facing any such issue regarding not disposing the money to creditors than winding
up procedure is to be undertaken (Lowe and et.al., 2016). If winding up procedure is choose it
also affects the dignity of the company thus, out of court settlement is the best methods to
resolve the issue in better way.
This matter is relevant to the case study of the Salomon V A Solomon & Co. Ltd as
Salomon is engaged in making the shoes and after having pressure from his children regarding
undertaking the partnership business, they turned the business into the limited company
(Salomon v A Salomon & Co Ltd [1897] AC 22, 2019). They purchase the business and deal is
made by paying £39,000 and than the deal was done for £10,000 debentures and £20,000 in fully
paid up share with £1 share each and remaining balance in cash. But the sales of boots was
declined in market and company goes into liquidation.
Application:
By applying this case to the recent case study, the judgment is given in respect of
undertaking various aspects through which they can save the integrity in respect of winding up
procedure. Company can apply the out of court settlement in which they can choose the
negotiation procedure through which they can undertaken the negotiation with the creditors in
respect of not reaching to court for winding up procedure (Picciotto and Mayne, 2016). In the
procedure of negotiation, their is no involvement if third party is examined, both the parties settle
the matters by sitting together and than conclude the decision in right way.
Conclusion:
From the above study, in respect of company law, the matter are to be undertake in
respect of protecting the reputation of the company by undertaking the matter related to out of
court settlements. In this aspects, the main aspects of applying the negotiation procedure is that
they can discuss the matter internally and cannot refer the cases to the third party. If the parties
are not satisfied with the judgement which is raised out from the negotiation, they can reach to
court for further settlement.
CONCLUSION
From the above report, the study examined that business law is regulated to control and
manage the overall activities which is endeavour in business. Through this aspects, it protect the
right of the parties in respect of dealing in any civil or criminal activity and thus thorough this

manner the offences are punishable under the courts. By this aspects, in respect of undertaking
the matter related to sources of law it determined various sources which helps UK citizen to
protect their rights in many way. In context of making any law in country it carries various
procedure through which the laws are enacted and regulated in country. It also undertakes the
aspects relating to managing the business organisation in different aspects. Lastly it concludes
with various solution which is given to parties in respect of securing the interest under the
employment law, contract law and company law.

REFERENCES
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