Business Law and Ethics: Contract and Corporate Governance

This report provides a detailed examination of business law and ethics, beginning with an overview of contract law, its key components, and the English court system. It analyzes a scenario involving Hilary and potential binding agreements with Olivia, Eleanor, and Amy, offering advice on their legal standing and available remedies. The report then shifts to a discussion of corporate governance and business ethics, using the Enron scandal as a case study to illustrate violations of ethical conduct and the importance of the Sarbanes-Oxley Act of 2002. The Enron case highlights accounting fraud, misleading practices, and the impact on stakeholders, emphasizing the need for ethical business practices and transparent financial reporting. The report provides a thorough analysis of the legal and ethical dimensions of the Enron case and its implications for corporate governance.

Business Law and
Ethics
1

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1...........................................................................................................................................3
Contract law and description of all blue print of a contract...................................................3
Court system in relation to English legal system and direction to all parties about which courts
action they can pursue............................................................................................................5
Advise Hilary to whether binding agreements exist between her and each of following people;
Olivia, Eleanor and Amy........................................................................................................5
Several remedies accessible to parties....................................................................................6
TASK 2............................................................................................................................................6
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
2

INTRODUCTION
Business law and ethics are key elements of greater organizational success and growth.
Business laws encompass all of the regulations and rules that dictate how to form and operate a
business company. It includes all of laws that governs how to begin, manage, exquisite and close
any kind of business. While business ethics refer to implementation of appropriate practices and
policies of a company in context of arguably controversial topics. Some problems that come up
in a discussion of ethics include insider trading, social accountability, corporate governance,
discrimination and fiduciary accountabilities. The current study will divided into two tasks, task
one will explain contract law, all blue prints of contract, and will describe court system in
context of English legal system.
It will justify appropriate suggestions to all parties about which court action to pursue. It
will define recommendation in regard to Hilary as to whether binding contracts exist between
herself and other parties and will also explain different remedies accessible to Eleanor, Olivia
and Amy. Furthermore, this report will discuss given case in relation to Sabane Oxley 2002 and
ethical corporate governance.
TASK 1
Contract law and description of all blue print of a contract
Contract law defined as part of law that governs, formed and interprets agreements in
context of exchanging products, resources, services and properties. According to this agreement,
a law made between two or more parties or business organizations, in which there is a
commitment to do something turns for a benefit or gain, is legally binding (Savelyev, 2017).
Contract law is main element of many business dealings and contracts and anyone entering into a
agreement should that failing to abide by it, even by unintentionally can outcomes in major
challenges. It usually governs legality of contracts made between two and more companies or
individuals where there is an exchange procedure of some sort intended to take place. In mostly
all business deals and transactions, legal contracts are formed. Such agreements, even when
made by verbal contract, are legally enforceable as an obligation to meet terms and conditions of
conformity has been developed. Employment agreements, exchange of products or money,
purchase orders and bills of discounts are included in list of examples in context of agreements in
ventures (EVDOKIMOVA and STEPANOVA, 2019). A contract is consist of key components
or steps that is called a blue print-
3

Offers-
The first component of a business agreement or contract is offer; a company can issue an
existing offer to treat by putting their commitment out that it is open to accepting business deals.
In simple words, when one party seek to sign contract with other one, they must offer something
really precious and valuable so that interest organization or business owner can stated their
preferences.
Acceptance-
It is the second element of the contract blue print, acceptance mean that someone has
decided to take up the best offer for other one. It is a term that defines process of accepting offer
by other party who is interested within it. It is a proposal made by owner which required
accepting by other person to make legal contract between both of them. Example taken from case
study defines acceptance element. Eleanor has not accepted contract to pay £15,000 instead she
say that she will like to pay £13,000.
Consideration-
Before making a legal business contract there must be some amount of this element such
as services, object and payment that means both parties in a contract need to pay something to
each other either product or anything. In three above given cases there is no exchange or
transaction of services or goods and consideration among interested parties has been done so
there were no contractual deal between them.
Legality of subject matter-
Any types of contract are mainly developed with legal purpose at same period statutory
regulations also considered by both parties so that agreement can become valid. It is the main
component or step of contract blue print. In respect of given case study, there was no legal
contract between Hilary and other two parties has been done in context of payment exchange of
products.
Contractual intent-
In order to make a valid agreement both parties require being interested or intended in
buying services or products offered by other parties. Such as in case of Hilary has intention to
sold gallery paintings but Eleanor and Amy are not interested to have these.
Contractual capacity-
4

This component stated that one party must have contractual ability to enter into
agreement such as Hilary and others. Eleanor and Amy must have capacity to pay particular
amount as developed by main character of case study such as Hilary.
Court system in relation to English legal system and direction to all parties about which courts
action they can pursue
English Legal system is common regulation of England and Wales that usually comprises
civil law and criminal law, both having their own courts (Wilson and et.al., 2020). It is ideal for
coming legal case that has supported in better decision and suggestions of conflict that arises
between two or more parties. It illustrated that there are three different kinds separate legal
systems in UK such as Northern Ireland, Scotland, Wales and England. Legal structure of United
Kingdom has distinguish into two are house of common and House of Lords. To become a
member of these houses a person need to be elected at same period there are some people that are
disqualified from membership on basis of occupation and status. It has above 650 individual of
parliament, each electors has one vote therefore member that has maximum number of votes in
term to be Prime Minister. While it can be defined that house of lord is representative framework
and elected.
Therefore, each person are elected on basis of advice or recommendation of PM by
monarch. It can be illustrated that common law system is usually followed in both Wales and
England that is accountable for passing regulations and development of precedents by utilize of
case law. Supreme and senior court is totally accountable for this law and legal system as well.
From above discussion it can be said that all the parties such as Hilary, Olivia, Eleanor and Amy
can approached nation court to resolve their issues in regard to contractual deal (Cairney and
et.al., 2019). In this case they all are not happy and satisfied with decision of courts than they
have choice to go to take civil division and when they are not satisfied with judgement of civil
court of appeal than also they have another option to supreme court that is final judgement
resolution and maker of conflict and difficult cases.
Advise Hilary to whether binding agreements exist between her and each of following people;
Olivia, Eleanor and Amy
After considering and understanding above case study it can be illustrated that Hilary
have promote for selling printing press for fixed amount of 15,000 so Eleanor argued that she
wants property of Hilary in 10000 not more than it, but Hilary has not accepted and said that she
5

would sell last at 13000. So, there was no legal contract between Eleanor and Hilary has been
created that she can make purchased of his property at rate of 13000 or 10000. It can be said that
there is no binding agreement has been done between both parties to have make payment for
printing press.
In second case study that related to Amy, stated that Hilary desire to sell her computer for
only 1000 and other party such as Amy agreed seek to purchased office computer for particular
amount. It clearly described that binding contract or legal agreement was made between both
parties that they will sell and purchase computer at particular amount. But before sending fax and
said that ignore the arrived letter which lead to cancelation of contract made between Hilary and
Amy.
On the other side, in last case study there was no binding contract or relationship between
Olivia and Hilary has been made as she has provided that she will sells valuable painting made
by famous painter is Trumpter at only 1 pound to first consumers at beginning of sales. But when
Olivia enters Hilary have been sold out painting so as there was no agreement between both of
them.
Several remedies accessible to parties
Sue to damage-
There is no remedies or methods as there is not break of contractual agreement between
Eleanor with Hilary, Hilary with Olivia, but she have contract with Amy so may have to pay
some money (Lu and Xiaozhen, 2017). It can be said that Amy has to pay some amount to Hilary
when she had to incur any types of expenses to make supply to item to target consumers. By
making contract for damage caused made issue between two or more parties can be effectively
solved.
Recession of court-
It can be analysed that in case when one person is not capable to fulfil their obligation
that other can also have opportunity to refuse their activity. Just like in three case studies Elanor
and Amy as customers have not fulfil their obligation to pay and purchase desire products to
Hilary so it can also not provide computer and printing press to them.
TASK 2
The Enron Corporation is one of the most known global corporate scandal where
reporting of financial condition has been presented by planned accounting fraud and ethical
6

corporate governance violated within business displaying wrong business ethics. Display of
wrong accounts and financial functional records have been major factor within accounting
functional performance avenues. The case analyses that Enron company engaged in mark to
market accounting, for which company received official US securities and exchange
commission approval in 1992, which enables companies to value their financial accounting
situation based on how evolution of various measures can take place. Enron used wrong methods
of accounting to overinflate company estimated profits, mislead investors and also various
shareholders within business in competitive industry, The scandal has widely reported brought
into question various accounting practices which have been violated and also strong importance
of corporate governance within business in industry for longer term. Ethical corporate functional
ethics are widely important refers to goodwill enhancement paradigms and for continuous
effective goals development referring to higher scope of larger profits (Jones, 2019)
Conducing of business within day to day ethics has been widely developed as one of the
most important growth paradigm which enables company to function with wide yielding
synergy of innovation and continuous transparent platforms for gaining positive synergy within
hemisphere and for communicating wider roles among stakeholders. Corporate governance main
objective is to enhance stakeholders value and protect stakeholders goodwill by improving
performance levels scenarios and for generating larger goals functionally programmed as per
their diverse functional paradigms. Enron scandal drew attention to accounting and corporate
fraud as its shareholders lost around 74$ billion on past 4 years leading up to bankruptcy and
employees also lost billions in pension benefits where company was fraud and indulging in
wrong business practices and there were actually unethical parameters put on. Scandal is also
well known example of wilful corporate fraud and corruption where it brought under question
the varied accounting practices and activities followed within administration of many
corporations in US and was factor in enactment of Sarbanes- Oxley act of 2002. It also
impacted greater business ethics by causing dissolution of firm practices with accounting auditor
company Arthur Anderson which also violated public disclosure rules in dealing with functional
ethics. It can be further analysed that Enron violated rules while business functioning ethics
where bankruptcy examiners report highlights numerous avenues for criminal investigators
seeking for bringing case that company is presenting forward among partnership books
officially. It has been widely misleading for stakeholders and shareholders to function on various
7

paradigms for gaining stronger working practices, yielding synergy of functional ethics and
violating question of accounting practices where all potential metrics are unable to achieve
(Bowden, 2019)
The lower level employees were encouraged to further invest in company stock for their
retirement savings just before company collapsed, workers later filled class action function
lawsuit and won an $85 million statement which has widely reduced efficiency levels within
services. The governance ethics can be understood within 4 parameters which are as follows:
People, purpose, process and performance which enables to develop new goal avenues of ethical
presentation of business services, The company corporate governance tools such as
encouragement of deeper stockholder engagement which presents functional paradigms enabling
to yield onto higher synergy of ethics functionality by allowing transparency of all information
among stakeholders.
Sarbanes Oxley act of 2002 is known as Public company accounting reform where
investor protection fundamentals and corporate accounting auditing , responsibility formulating
techniques with transparency goals for gaining stronger functional activeness. The public
company boards, management within accounting firms where it also applies within business in
private forms such a wilful functional ethics to improvise further and also gain wider business
ethics onto larger goals (Parker Jr, 2019). Primary goal of this act was to fix auditing
parameters and fix auditing of U.S public companies consistency within its performance
measures avenues and regulating firms corporate governance. Sarbanes Oxley act has been
widely known as one of the most informative tool used to evaluate compliance with act
reinforcement of information technology and new security controls and upholding various
financial problems for stronger performance goals with new reinforced avenues goals. public
companies consistency within its performance avenues , also regulating accounting firms that
audit companies must comply with all legal formalities to abide company functional competitive
performance metrics. Sarbanes Oxley act is one of the most innovative tool used to evaluate
compliance with the act reinforcement of information technology and security controls,
upholding various financial problems for stronger performance metrics with reinforced avenues.
The SOX act profoundly focuses on major corporate ethics where there are participatory factors,
consensus, oriented and accountable, responsive with large effective goals focusing on major
business paradigms enforcing compliance of major arenas. The SOX created new auditor
8

watchdog, within public companies where it focuses on inspection, investigation goals and also
enforces systematic transparency goals within corporate governance goals. It also profoundly
prohibits accounting firms from doing business wrong practices and also fundamentally gaining
larger technical efficiency where shareholders are shared exact accurate information pertaining
onto financial performance. SOX protects employees which report fraud information and
testify court fundamentals against employers where companies are not allowed widely to change
terms and conditions under which business is operated to shareholders and business nominees.
The company employees shall report all functional parameters relatable to corporation
relation safety and health administration factors where factors of business ethics violation are
hurt and reported under law for technically bringing functionally it before law. The financial
conditions play an impediment role under high integrity force of best quality metrics, where
Enron fraud scandal has widely violated this act where financial reports of business was
shown sustained by fair, systematic and creative planned accounting fraud to mislead investors,
potential business within industry competitively and for working onto larger goals widely. This
can be in detail more analysed that various fundamental measures , determinants onto which
business must adhere and follow have been widely violated. The transparency and daily
meetings conducting paradigms shall be followed within company goals, actions for functional
stability which further enhances new relative paradigms and also to leverage new relative goals.
SOX act also has been productively one of the most important act within UK business law
communicating diverse course of actions under law and where there are major technical
fundamentals goals relatively built on for reaching onto larger arenas and to productively
enhance stronger working goals and platforms for goodwill development (Bhagat and Bolton,
2019). Corporate governance in business plays wide importance in governing stronger
commitment and trustworthy business platforms with external and internal stakeholders for
gaining new profits for longer run efficacy and higher goodwill goals. Enron company
misleading information of various financial information of reports and for attracting investors
and shareholders have been imposing negative impact further onto larger business profits and for
effective completion of governance ethics and to factor on larger objectives further onto where
goodwill can be strongly developed. Business law parameters have been unable to deliver growth
with higher functional leverage goals and efficacy fundamentals onto where yielding synergy of
various communicative decisions can be pertained onto among business scenario. It can be also
9

analysed that Sarbanes Oxley act play widely important role in functioning within information
goals, corporate structure formulation and to evolve as one of the most profound metric
focusing stronger synergy within workforce law implications and to govern larger objectives
further onto business paradigms evolving new reflective synergy. Enron company case enables
us to yield focus onto how much important it is t focus on business ethics and relatable business
development further for communicating transparent vision, goals and financial fundamental
information further for longer term goals as by working under Oxley act. It enables to enhance
customer market goodwill and standards of working wit evolving technology metrics and
building new working paradigms functionally developing new goals to abide within longer time
period. This case has been profoundly one of the most important and high profile business law
violation case where goals of working efficacy have been violated by Enron company and
strongly also developing new competitive scope among various functional horizons (Lagasio and
Cucari, 2019)
CONCLUSION
The report can be understood within conclusion that there are various parameters of
functional horizons under which business law is built on and UK law being one of the highly
structured forces of law provides various arenas and structural duties to be done by companies.
There is analysis of various cases, studying and outlining various arenas of corporate structure
roles where transperant functional horizons holds wide importance and to also examine various
fundamentals of new avenues, higher working synergy conducting analysis of various goals and
referred functional structure where abidance of major laws are highly important. The case of
Enron Company has been potentially focusing onto how various laws, sanctioned parameters of
transparent business communication among employees within company and within stakeholders,
shareholders who are looking for investing further.
10

REFERENCES
Book and Journals
Bhagat, S. and Bolton, B., 2019. Corporate governance and firm performance: The
sequel. Journal of Corporate Finance, 58, pp.142-168.
Bowden, M.M., 2019. The Professor Anthony J. Santoro Business Law Lecture Series Presents
Becoming A Valued Business Lawyer.
Cairney, P and et.al., 2019. How to conceptualise energy law and policy for an interdisciplinary
audience: The case of post-Brexit UK. Energy Policy. 129. pp.459-466.
EVDOKIMOVA, A. and STEPANOVA, Z., 2019. TYPES AND ELEMENTS OF THE
CONTRACT IN ENGLISH LAW. In We speak Legal English, German, French,
Spanish… (pp. 231-232).
Jones, L., 2019. Introduction to business law. Oxford University Press, USA.
Lagasio, V. and Cucari, N., 2019. Corporate governance and environmental social governance
disclosure: A meta‐analytical review. Corporate Social Responsibility and
Environmental Management, 26(4), pp.701-711.
Lu, L. and Xiaozhen, L., 2017. On the Relationship between Damage Compensation and
Default. DEStech Transactions on Social Science, Education and Human Science,
(ssme).
Parker Jr, L.V., 2019. Corporate and Business Law. U. Rich. L. Rev., 54, p.73.
Savelyev, A., 2017. Contract law 2.0:‘Smart’contracts as the beginning of the end of classic
contract law. Information & Communications Technology Law. 26(2). pp.116-134.
Wilson, S and et.al., 2020. English legal system. Oxford University Press.
11