Business Law Report: Legal System, Business, and Regulations

This report, prepared for a BTEC Level 4 Higher National Certificate in Business, Unit 7: Business Law, delves into the intricacies of the UK legal system and its profound impact on business operations. It begins with an overview of the legal framework, exploring various sources of law, the government's role in law-making, and the application of statutory and common law in business contexts. The report critically reflects on the strengths and weaknesses of the legal system, providing examples to illustrate its effectiveness. It examines key legislation, regulations, and standards that new businesses must navigate, differentiating between them to analyze their potential impact. Furthermore, it explores different laws that businesses must adhere to, such as contract, copyright, employment, and tort law, and analyzes their implications. The report also compares and contrasts different organizational structures in both the public and private sectors, detailing their legal structures, advantages, and disadvantages. It includes case studies to solve disputes and concludes with a critical evaluation of how different organizations are managed and funded. The report aims to provide a comprehensive understanding of business law to support business decision-making.

BUSINESS LAW

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
1. Explanation of the legal system, different sources of law, the role of government in law-
making and how statutory and common law is applied to businesses.........................................3
2. A critical reflection of the legal system using examples to demonstrate strengths and
weaknesses...................................................................................................................................4
3. An explanation of the key legislation, regulations and standards that a new business needs
to be aware of...............................................................................................................................5
4. Different law which businesses have to follow and analyse their potential implications on
businesses.....................................................................................................................................6
5. Different types of organisation in public and private sector with its legal structure and also
mention advantages and disadvantages of each. .........................................................................7
6. Critical evaluation of how different organisations are managed and funded in both public
and private sectors........................................................................................................................8
TASK 2............................................................................................................................................9
CASE 1........................................................................................................................................9
CASE 2......................................................................................................................................10
CASE 3......................................................................................................................................11
CONCLUSION .............................................................................................................................12
REFERENCES .............................................................................................................................13
.......................................................................................................................................................13

INTRODUCTION
Business law is called as a laws which deals which regulate the dealing between people
and moneymaking matter. It starts from the day of setting up of new business organisations. It do
have a systematic manner that need to be followed by every association as it is mandatory to be
followed. It is also called as corporate law (What is Business Law, 2019). the success of business
is always depended upon the knowledge of owner in the field of Business law. Today, in this
report all the suggestion on given topic will be from one of the law firm side. The points that are
required to be covered such as various sources of law in UK, role of government body in
constituting any law and what are their main use in business firm. The additions points that are
also going to be covered are in this file are how business is formed and what are its cons and
pros. Also, in task 2 some of the dispute solving technique will be very crucial as it will enhance
the power to solve case study types question which is very important in the field of law.
TASK 1
1. Explanation of the legal system, different sources of law, the role of government in law-
making and how statutory and common law is applied to businesses.
There are various types of law which are present in UK to protect the rights of every
people and provide them freedom to work in a peace environment. The legal system of UK says
that it is important for everyone to follow the rules and regulation as it is very necessary for the
betterment of every nation. The power of forming any kind of legal system is in the hand of
government and it must have understood by everyone that nobody can challenge the laws which
have been implemented by government.
At present, there are various sources to constitute any law within the boundary of UK and
the major role is always being played by the Legislation where members of parliament need to
take active part (Bargiela-Chiappini, Nickerson and Planken, 2013). The second source to
constitute any law is European Union law which have the huge role and even it can be easily said
that parliament also don't have the power to overrule it. The third source is Common law where
judges need constitute new law in that condition where legislation and other supportive sources
are completely silent. Also, European convention on Human Rights helps to commence new law
which focuses on the rights of people within the geographical area of UK.

As, it is clear that role of government is very vital in constituting law but it is necessary
that how it is being conducted. There are seven major steps that need to be followed by the
government at the time of commencing law such as First reading, Second reading, committee
stage, report stage, third stage, House of Lords and at the end Royal Ascent (Nonet, Selznick and
Kagan, 2017). In all steps roles are being played by Parliament which is divided into two groups
such as House of Lords and House of Commons. The role of House of Lords is only in last two
stage and other all need to be done by House of Commons.
Statutory and Common law both are very crucial from organisation point of view. They
both helps on daily bases to take decisions. In context of Statutory law, it helps organisation to
prepares their Memorandum of Association & Article of Association and helps to take corrective
decision. As, it is one of those area were laws have been already commenced and it only need to
be applied in the respective situation. When it comes to Common law, it is always being applied
through those law which have been commenced by the judges of supreme court. Even prepare
laws according to the requirement of organisation which also guides any association to take
corrective measures.
2. A critical reflection of the legal system using examples to demonstrate strengths and
weaknesses.
The legal system of United Kingdom has been playing very important role since laws are
being commenced. It is mandatory for everyone that they must follow the rules and regulation of
legal system which help to maintain the decorum of the nation. As, it has many strengths where
harsh punishment has been already allocated so that no one can break the rules and regulation of
the law. It main strength is that it is clear, fair and even predictable which are based upon
precedent. The time which is taken to declare the result is very short which have brought the
concept in people that they can be reliable on it, if any problem arises (Menkel-Meadow, 2013).
Everything have its own strength but inside that criminal minded people always tries to
find that how weaknesses can be brought in it. Some of the weaknesses of Legal system of UK
legal system is that they need to follow a lengthy process to commence any kind of new law
within the boundary of UK. Even laws can be changed at any times which have been enforced by
common law is one of the weaknesses of UK law.
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M1: Evaluate the effectiveness of the legal system in the terms of recent reforms and
development.
It can be seen that laws and authorities which have been formed in UK are at its best. It is
helping each and every person to take there decision easily. It is important that how people can
understand it because if basis knowledge is missing then it will not be easy to take corrective
decision on regular intervals. Still, some of the updation need to be done because there are
various Act which are not being used in a systematic manner. In order to bring them in use, it is
necessary to come up with some changes.
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 judgement.
The legal system of UK has its own rules and regulation which is helping them to
maintain peace and silence in its boundary. But, it can be said that there are lots of area where
changes need to be done because weaknesses can be found in some of the points. Even power of
constituting law is only in the single hand which is the one of the disadvantage for UK because
people are not satisfied in many of the cases.
Example: It can be seen that while constituting any law in UK, the final consent must be taken
from the head of state . It is mentioned under Royal Ascent Act, 1961. This is one of the con for
UK general public is not allowed to take any part while commencing law.
3. An explanation of the key legislation, regulations and standards that a new business needs to
be aware of.
Every investor need to know that how business can be commenced and what are the
essential criteria that need that need to be fulfilled. It is the responsibility of businessman that
they must be aware of all the situation that can be raised at any time. The first thing that must be
considered by every organisation are legislation, regulation and standards.
Legislation is important for business organisation because it helps to guide that how
company can be established (Deva, 2012). Even it tells that what are essential law which need be
followed by and association. When it comes to Regulation it guides the organisation that what
are primary rules and regulation that association need to regulate. It says that it must regulated
itself through company law and all those laws which are required. At the end, Standard are that
basis are which has a huge impact on company because it tells that what should be the level of
your product or your work quality.
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M2: Differentiate between legislation, regulations and standards to analyse potential
impact upon business.
Legislation is one of the coded language which have its own importance. As, it is
important to have a knowledge regarding legislation so it can be easily said that it is useful in
each and every department on regular basis. It do have a impact on business activities as laws are
being formed for every sort of association which need to be followed. While taking about
Regulation, it can be said as the action or process which need to be regulated as per the
guidelines of legislation. It is helpful for every business organisation because it helps to regulate
every rules which are being commenced for companies. At the end, Standards says that every
organisation need to main their standard as per the guidelines of Companies law. It means no one
can perform those activities which are below the average as legal charges can be imposed.
4. Different law which businesses have to follow and analyse their potential implications on
businesses.
There are various types of laws which have been imposed on business organisation. It is
necessary to follow their guidelines which is very important on regular basis to run a business on
successful node, else penalty can be imposed which can destroy the life cycle of any company.
There are various types of law under it, such as contract law, copyright, employment and law of
torts which must be considered at the time of commencing business. When it comes to Contract
law it tells that how company can enter into any contract and why it is important to perform as
per the deed. There is a Copyright law which helps to protect the rights and interest of a
company. Its potential impact shows that no one is allowed to copy other which allows any
business entity to perform smoothly.
Employment law is also one of those law which is very important from both companies
and employee's point of view because it provide the guidelines that how company and worker
should behave with each other (Salome, 2012). The impact of employment law shows that what
should be number of employee's in an organisation and what can be their suitable wages rate. In
the end, there is law of trot which is the most important law. As, all the guidelines should be read
very carefully just because its major duty is to find the person who should be held personally
liable in the condition where default has been done.
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5. Different types of organisation in public and private sector with its legal structure and also
mention advantages and disadvantages of each.
Private company is defined as the company where liability of investor are secured and
even whose share cannot be transferred to outsiders once business is commenced. This types of
companies do have fix patter to perform their task and plays very important role to promote
business sector among general public. Public Company are those organisations whose shares
can be freely traded on stock market. This form of business provide flexibility to investor (Nard,
2014). It UK, to run any public company it is important to list themselves under London Stock
Exchange.
Limited Liabilities Company: It is one of those company which falls under the category
of private sector company. This types of company are mainly run by their investor. The main
reason behind forming this form of organisation is that there are various benefits which are being
provided to them. It has a legal process that must need to be followed so that legal rights can be
given to them. The basis requirement that need to be done by limited Liabilities Company is that
they must register themselves under Companies Act, 2006. But at the time of registration they
must submit some of the additional documents like complete details must be mentioned in
Memorandum of Association and Article of Association. Even they must have mentioned the
total number of members and the limit should not exceed.
The main advantage in Limited Liability is that they can enjoy the rights of perpetual
succession where they will have the rights to sue and can be sued. Even company can raise fund
from various source in this types of private sector company. There are also many disadvantage of
it like they need to prepare annual accounts as other company do. Even formation cost is also
high so it is not possible for everyone to invest their money in limited liability company.
Corporation: It is one of those company where involvement of general public can be
found so it also knows as public company (Esposito, 2012). The main motto of this types of to
business is to ensure the investor that they can cannot with the company till they want. Here, if
investor want to be the part of company then they need to purchase the share from share market
i.e. London Stock Exchanges. This types of company mainly need to work at greater platform
where everything is dependent upon market. Even various types of benefits are also provided to
them when it is compared with other companies. To form any legal corporation, it is necessary
that the given guidelines must be followed. Firstly, they need to decide the name of an
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organisation which should not be matched other registered firm with appropriate address. Then,
it is necessary the name of first share holder must be mentioned. After that, company should
select the name of first director (even first shareholder can also be first director). Once this
process is completed then Memorandum of Association (MOA) and Article of Association
(AOA) should prepared. Even SIC (Standard Industrial Classification) should also be obtained.
And in the end it is necessary that company should submit this all documents in the Companies
House (Wilson and von der Heidt, 2013).
At the time of formation every investor thinks twice that what can be the cons and pros of
a respective company in the same manner there are some of the advantages of corporation such
as, it enjoys the right of perpetual succession where presence or absence of any investor doesn’t
affect the motto of organisation. Even this types of company do get the opportunity to raise
money from various sources as it has legal existence. Some of the disadvantages of establishing
corporation are that it required huge amount of money with skilled manpower. Also, it has to
follow long formation process which increases the overall cost.
D2: Critically review and evaluate types of business organization
As, there are various of business association can be found easily but rights are not
distributed equally. It is necessary plan something new for all types of firm because it will help
them to work freely. It is important to provide legal existence because it will be beneficial at the
time of suing other party if they have worked against the law. At the end, it can be said that there
are lots of changes which need to be done in Companies Act, 2006.
6. Critical evaluation of how different organisations are managed and funded in both public and
private sectors.
As their various form of organisation which is required to be managed and funded and for
that it requires proper planning too. The private sector companies are mainly managed by its
members and manager where as to run any public company the main requirement is of its
directors.
Limited company: This types of companies need to manage their fund by the capital invested by
their share holder. Even company can take from various financial institution and also loan can be
taken from different government agencies. The major duty to manage this form of business is in
the hands of investor and their authorised manager (Enriques, Gilson and Pacces, 2014).
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Corporation: It is the biggest form of business so it need to organise in the systematic
manner and for that large amount of capital is required. The major source of raising fund is from
share and for that they need to register under London Stock Exchange. Loan can also be taken
from Banks and government agencies. Also, peer to peer lending can be done which is very
common form of raising fund at present time. The role of managing Corporation is in the hands
of KMP (Key Managerial Personnel) which mainly includes Manager, Directors and investors
i.e. shareholders.
Cooperative Society: The role of managing cooperative society is always with Group of
member who work for the purpose of providing service at minimum rate. And the major source
of raising is in the hands of those member who invest money in the company and their Board of
Directors who takes most of the decision.
Social Enterprises: This are those form of organisation which mainly focus on doing social work.
This are mainly run by the trust and their member (Henderson, 2014). Even government also
take active participation in this types of business. To setup social enterprises permission should
be obtained from government agencies. The main responsibility is to manage the activity of
social enterprises there must be any authorised personal who can manage the activity of the trust.
TASK 2
CASE 1
Case Study: There was a contract between Gordon works and Orange Computer Ltd that
they will they pay Gordon £10,000 and commission payments (at 9%). But due to tough
competition in the market they changed their contract agreement that they will only pay
commission amount to Gordon as company is running in loss. Now it can be seen that company
has recovered all the losses and even they are earning a lot. Looking at this condition Gordon
want to claim his money back from year 2015,2016 and 2017.
Contract law: It can be described as the method to enter into any agreement. It is
necessary that contract must be valid and should have a valid reason else it will be counted as
void. If any of the party leave the term and condition of contract in between the work, then is
called as breach of contract. In this condition, valid reason is not found to breach the contract
then defaulter need to pay the amount of losses which has been occurred just because of it. To
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make any contract as valid there must be offer and acceptance which is the most important part
of any agreement.
Employment Law: This is one of those law which have been made enforceable just to protect the
rights of employer and employees (Simkovic and McIntyre, 2014). It is one of the important law
which helps to decide what can be the actual wages rate that need to be paid to every
employee’s. Even it is necessary because it provide the guidelines that how much worker need to
work on regular basis and what rules and regulation they must follow. At the end it can be easily
said that it is one of those law which is beneficial for both employees and worker.
Conclusion of the case: From both of the given law, it can be easily understood that
Gordon must get the amount from Orange Ltd because the main reason behind entering into new
contract was just that company is facing suffering losses. As, market position was bad so Gordon
decided to enter into contract. But, it can be seen now that Gordon should get the total amount as
he used to get before because the main reason of changing the contract didn’t exist anymore.
And it is the right of Gordon to get appropriate amount of wages from the time when company
started to earn more amount of profit.
CASE 2
Case Study: In the given case study, it can be seen that there was a contract between Janet
and Virgin Media for the purpose of installing internet and phone line. At the time of installing
the cable of telephone, engineer didn’t found the switch point so he just installed the internet
line. As, engineer didn’t found the line so he went back and did not return to install the cable
line. Finally, internet line was installed after 3 weeks but while receiving the monthly bill it can
be seen that the amount of telephone and internet has been included and because of this the Janet
is very upset.
Company law: It is defined as the law which is registered under Companies Act 2006. It is very
important to follow the rules and regulation of company law as per the given guidelines
(Ginzberg, 2017). The main motto of company law is to guide every organisation that how
official decision can help to achieve goals. But, company need to follow lengthy and expensive
process to commence their business. If any guidelines are not followed, then heave penalty can
be imposed at any time. In context of a case, it can be said that Virgin Media is never allowed to
do fraud with their customer as it is against the term and condition of a law. If they do so they it
will directly effect on their reputation in the market.
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Conclusion of the Case: From the given situation, it can be understood that Virgin Media
id not allowed to take additional charges from Janet because it was their default that they
installed the telephone line was late. Here, the duty and responsibility of Jane is just to pay the
amount of Internet. Also, the amount of telephone line from the date of installation. It is clearly
mentioned in the contract law that valid contract is always counted from the day when both party
is satisfied and ready to enter into a contract.
CASE 3
Case Study: The given case is related with the Blackhorse Ltd and its creditors. Here, Blackhorse
have taken the loan from credits which amounts to £100,000. As, they are unable to pay the debt
so one of the creditors files the petition for winding up. Now, court is trying to decided that
whether it is necessary to wind up or not.
Winding up: this is one of those process of company law through which legal existence
of company is almost over. They are not allowed to perform their duties and task. But for that
order must be passed from court which is mandatory (Hepple, 2013). It can also be said that it is
the last stage of any company. Basically there are two type of winding up such as Compulsory
winding up where creditors need to play the vital role because they need to file the petition order
just to recover their amount. And another one is Voluntary winding up where company
themselves thinks that they are unable to work according to their MOA and AOA. The major
role in this process is of directors and shareholders. In both the cases liquidator need to be
appointed who need to handle the situation.
Alternative Dispute Resolution (ADR): This the legal activity which helps to solve out the legal
matter out the court. It has got the legal permission from the court just (Krishnan and Masulis,
2013). The reason behind getting legal permission just that it helps to reduce the burden of court
which is very important at the moment. There are two methods to solve dispute under ADR and
they are listed below:
 Mediation: It is the initial stage of solving dispute where main objective of mediator is
give best possible suggestion. The main thing that need to considered in this is that
mediator must advice neutrally which is very important.
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 Conciliation: This is the second stage to solve dispute where main motto is to meet the
term and condition of a contract. Although, it is not important to follow the instruction of
conciliation, still it is one of the best among all this process (Miller, 2013).
 Arbitration: It is the main and the most important process in Alternative Dispute
Resolution because it mainly deals with the complicated nature of cases. The decision of
Arbitrator is legal in binding must be followed by the involved parties. The process of
arbitration is expensive when it is compared with other methods of solving dispute. The
main rule in this method is that the number of arbitrator must be in odd number which is
helpful to declare the result in systematic manner.
Recommendation: In this the recommendation to creditors and Blackhorse can be given that
they can solve their dispute through ADR process. It will minimise the overall cost and even
decision can be declared vary easily. If they take the help of court to wind up the company,
then it ends the life the company which will not be benefitted from companies point of view
so it better to solve their dispute through the process of Arbitration of Alternative Dispute
Resolution.
CONCLUSION
From the above report, it can be concluded that business law is one of those field which is
very helpful for conducting business activities. There are many various sources of laws in UK
which helpful to maintain peace in its territory. Even, it there are different types of company
which need be manages systematically so that benefits can be earn. But it is necessary that rules
and regulation must be followed else heavy penalties are there. In the end, case which have been
solved shows that no one can overrule the guidelines of law. And, Alternative Dispute
Resolution is one the best way to solve the dispute which arises between the parties due to some
misunderstanding.
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