Business Law Report: UK Legal System, Business Organizations

This report provides a detailed analysis of UK business law, structured into four key tasks. Task 1 explores the sources of law, including Acts of Parliament, common law, custom law, and EU law, and explains the government's role in law-making, differentiating between statutory and common law. Task 2 examines the impact of company law, employment law, and contract law on business associations, using British Petroleum as a case study, and discusses the gig economy and the Pimlico Plumbers v Smith case. Task 3 delves into the legal formation of different business organizations and their management and funding. Finally, Task 4 recommends legal solutions for resolving disputes, offering guidance on obtaining legal advice. The report aims to provide comprehensive insights into the legal framework governing businesses in the UK, with a focus on practical applications and implications for KANGO.

BUSINESS LAW

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Explain the different sources of law......................................................................................1
Explain the role of government in law making and how statutory law and common law is
applied in the court.................................................................................................................2
TASK 2............................................................................................................................................4
With the help of relevant example demonstrate the impact of company law, employment law
and contract law on business association...............................................................................4
TASK 3............................................................................................................................................6
Explore how different types of business organisations are legally formed............................6
Explain how business organisations are managed and funded...............................................8
TASK 4............................................................................................................................................9
Recommend legal Solutions for resolving a range of dispute using examples to demonstrate
how a party might obtain legal advice and support................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business law is explained as the law which helps to govern the world of commerce. It
mainly governs the dealing of businesses and work related to business organisation. There are
number of act and laws which falls under the category of commercial law and those are
Company law, Partnership Act, Sales of goods act, contract law and many more. This project
will be divided into four different task where all the information and suggestion will be given to
KANGO (K). In first task the discussion will be on the nature of the legal system of UK. In
second task the area that will be covered will focus on the impact of the law on business. When
project will proceed ahead then discussion will be on various types of business organisation and
in the ending segments disputes will be solved with the help of suitable dispute solving method.
TASK 1
Explain the different sources of law.
The law and policies which are being implemented in UK are based on different sources
and even it is important too because it covers huge area like Scotland, Northern Ireland, England
and Wales. The detail description of various sources of UK law is explained below: Act of Parliament: It is the supreme body of Great Britain which commences law. Under
this source, House of Common and House of Lords take active participation at the time of
commencing law and the reason behind that is Sovereignty. The law which are enforced
by the act of parliament are based on the suggestion given by common people. There is
also various kind of rules and regulation under which final approval is required to be
obtained from crowned headed person for passing the bill. Common law: This is the law where interference of Parliament is not seen and the reason
behind all that here laws are commenced on the basis of situation so here major role is of
judges who seats in one higher level of court for example high court, supreme court.
Common law are no fix life period as it can be amended as per the requirement but even
should also be followed which is the main thing (Adams, 2015). Custom Law: The power of commencing custom law is in the hands of the authorised
person of society or community. This law is based upon the ethical values and norms of
the community and as per the rules no one has the power to breach its term and condition.
In this modern ear, it is said there most of the laws are commenced by parliament of and
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European Union law so there is more and more requirement of of custom law by it is still
helpful for the people living within United Kingdom.
 European Union law (EU law): This is the strongest law which enforce most of the law
which are commenced within Great Britain. The ratio of total number of law in UK says
that around more then half of law are enforced by EU law. It is the main source among all
other sources in UK. The EU law is much and more powerful that even Parliament also
do overrule their law as they don't have the authority to do such thing.
Explain the role of government in law making and how statutory law and common law is applied
in the court.
There is the complex and most difficult process which is being followed by the
government of UK at the time of making law in UK. It is important for the government that they
most consider the situation that and then only they should try to commence the law so that proper
benefits can be provided. There is the complete procedure that is required to be followed and
that is explained below in detail: First Reading: This is the fist stage after drafting the bill where member of House of
common go through the points which have been drafted in the bill. Second Reading: The second reading is necessary because here member are required to
check that what is the requirement of commencing new law and whether drafted bill is
relevant or not. If members of second reading is satisfied with the bill then they forward
the bill for next process. Committee Stage: It is the most important stage as detail examination is required to be
done in this stage and for that it is necessary that every mentioned points should be
checked in detail. If there is the requirement of any changes the they are also suggested
which will be conducted in next stage. Report Stage: This is the stage which is conducted when any of the changes are required
in the bill. Main reason of this stage is to cover the weak areas of the bill which has ben
proposed by the member of House of Common. Third Reading: This is among those stage where every thing is to be rechecked and after
that voting is required to be done so that mindset of every member can be known
regarding the bill. Voting helps to find whether bill should be forwarded to House of
Lords or not and if not they why.
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 House of Lords: Bill is forwarded to House of lords only once the work of House of
Common is completed. In this stage, Peer member check the bill and decides that whether
bill is required to be modified or not and if not then it will be forwarded for the final
stage which is known as Royal Ascent. And if changes are required, then again report
stage and committee stage plays the crucial role.
 Royal Ascent: This is the stage where final confirmation is given on the bill which has
been proposed. Under this approval is required of monarch whose signature plays the
crucial role.
(Source: Role of Government in making law, 2019)
How statutory law and common law is applied in justice court.
It is necessary that how laws are being commenced in UK because that plays the crucial
role while declaring result with in the justice court. In context of Statutory law it supports justice
court at the time of declaring result as every single things is mentioned in it so judges of justice
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court are required to declare it by taking the help. When it comes to common law, even it helps
justice court because it provides special power where judges can declare result on of its own.
Also, common law helps to take the help of out countries law also where similar cases had been
already discussed.
This are some of the area which need to be considered by KANGO because if they are
unable to work as per the norms and values of English Legal system then it can affect the
organisation.
TASK 2
With the help of relevant example demonstrate the impact of company law, employment law and
contract law on business association.
In modern era different types of laws are required to enforce and among them it
necessary how much beneficial it is on regular basis. In context of business various laws are to
be considered by them where they have both positive and negative impact on business
organisation. It is up to the working style of association that how they use those all law because
overall that defines that how company will perform in future. Below, some of the laws are
explained with its majors impacts in context of British Petroleum. Contract law: It is among one of those law which have major impact on each and every
thing. Contract law mainly focus on the working policies of parties which are involving
within any of the work. It tells that for making any of the contract valid, there must be
offer and acceptance else it will be null and void contract. This the law which tells that
how and when work is to be done (de Silva, 2017). In context of British Petroleum, when
they enter into the contract with any of the party then they are required to complete them
all on given period of time. For example: if organisation have done contract with nay of
the petroleum company that they will not sell there product in any specific area for
certain period of time. And if company is will to sell there product in those area then
there will be breach of duty and heavy penalties can be imposed upon the organisation. Company law: This is the law which have huge importance on any of the business
organisation because it provides the guidelines on which any of the company is required
to work. It is important that each and and every register company must work according to
company. In context of British Petroleum, they are required to work as per the guidelines
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of Companies Act 2006, where they must appoint directors, prepare annual report,
conduct different types of meeting on various occasions which increases the cost of
organisation and that has the negative impact on British Petroleum.
 Employment law: This is the law which is helpful for both employer and employees
because it decides that what should be the relation of employer and employee.
Employment law is among one of those rear law which defines that what should be rate
of wages of workers working within the organisation. In context of British Petroleum,
employment law decides that what should be rate of wages of employees which doesn't
allow company to decide of their own which has the negative impact on association.
Even employment law says that each and every employees must be given various kinds
of benefits while working for the firm which indirectly increases the expenses and shows
the negative impact for company.
Difference between Employed and and Self employed.
Employed Self Employed
People need to the work under superior person
as their plans are required to execute.
Person is not required to work under any
person.
Rights to take decision of own is not allowed. People have the power to take decision of own.
GIG Economy
It is the theory which explains about the person work for certain period of time for any
other person or organisation. In this condition person will not be included under employment law
because they do not work for the longer period of time.
Pimlico Plumber v Smith
In this, Mr. Smith raise the question that he works for Pimlico plumber since last five
years but they are not accepting because they work as a self employed and according to that no
one works under that person. During the time of declaring the result, judges decided that
although Pimlico Plumber is self employed but Mr. Smith is work for him from a long time. This
is the reason that he will counted as a employee of a company and even every rights will also be
given.
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After analysing the case, it can be said that all the person who are working in KANGO
will be counted as employee because they are working since a long time. If they want the rights
of employee that it is necessary for them to work on each and every where negligence is not
accepted.
TASK 3
Explore how different types of business organisations are legally formed
There are number of options for commencing any of the business organisation but it is
the choice of investor that what type of organisation they want to form and that totally depends
upon the amount of capital investor is investing. The different types of business organisation are
listed below with the legal structure on the basis of its formation. Sole Proprietorship: It is the business organisation which is controlled by individual
person. In this, business and person are not separate from each other and even tax report
is also submitted in the name of individual. This types of organisation doesn't have the
power to sue and be sued on its own name and the reason behind that is existence because
sole proprietorship do not have the legal existence. Sole proprietorship do not requires
any kind of registration and even there is no legal method to commence this type of
business organisation. Partnership: These is the business organisation where two or more then two individual
person are required. The reason behind commencing partnership to bring more flexibility
because more number of people can manage business activity easily. The main drawback
of partnership is related with liability because liability is always unlimited in these form
of business. There is the legal way in which partnership firm is required to follow and it
from the registration process where deed should be prepared as per the guidelines of
Partnership Act and then documents should be submitted to Companies House for the
purpose of maintaining the records. Trust (NPO): It is the form of business where main motive is provide services to the
people. This form of business required number of things which need to be followed
which conducting business activity. The main drawback of this form of business is that
here organisation is not allowed to work for the motive of earning profit. While
establishing Trust, special permission is required to be obtained and after that there is
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also the requirement to registered under Companies Act, 2006 and in addition, it required
to prepare it is Memorandum of Association. Corporation: It is the business entity which is separate from its member. Under
corporation, the liability of member is only up to the amount of investment which they
have done within the organisation. It is said that there are number of formalities which
are required to be followed by corporation. There is legal process which need to be
followed while forming corporation. The process starts from selecting the name of
organisation where it is the rule that name should not be same. Then, director and
shareholder must be appointed so that major responsibilities can be handed to them. After
that, Memorandum of Association and Article of Association must be drafted so which
will decided that how organisation is going to work in future. In the end, all this
documents must be submitted to Companies House so that business activities can be
performed.
Salomon v Salomon
It is one of the rear case from which the concept of perpetual succession has been
introduced. Here, creditors of the Salomon failed the case against him because he was not
returning the money. But, court decided that case will not be entertained because company and
individuals are always different from each other.
Steps to form a company
 Name, address should be decided.
 Memorandum and Article of Association must be prepared.
 Shareholder and directors are to be selected. SIC code need to be obtained.
Role of Directors
 Decisions are required to be taken as per the planned schedule.
 Need to conduct all the meetings which are written under companies act.
Explain how business organisations are managed and funded.
Business can be incorporated easily if proper procedure is followed but the main thing
which can create different types of issues for firm when they are not managed and funded in the
systematic manner. In context of different organisation, they are managed and funded as:
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 Sole Proprietorship: It is the business organisation where there is no requirement of
additional fund but, in case if there is requirement then credit card can be one of the best
option for them and even there is the option where company can raise money through
personal assets. The purpose of starting sole Proprietorship is just to give additional
benefits so there is no requirement of any kind of additional team and it can be managed
the individual himself.
 Partnership: There are numbers of alternative available with these form of business
where it is said that they can add the capital in firm by bringing the personal asset of
every partner to the company and even loan is also one of the best alternate for raising
money under partnership.
 Trust (NPO): When it comes to managing day to day activity trust requires the proper
team so that chances of mistakes can be reduces. The responsibilities of managing the
work in trust is always with the Chairperson of the trust, directors and manager as they
are the work who plans each and everything in Trust (Adams, 2018). There are number
ways through which trust can manage its fund and among them government funding is
the most important. In addition, they can take the loan form financial institutions and
number of other ways are available for managing the fund.
 Corporation: It is the most valued organisation where multiple ways are available for
raising the fund and among them some of them are issuing share in the market, issuing
debenture and bonds. In addition, loan can be taken from banks, even peer to peer lending
is also possible as it is the must trustable form of business. There is the requirement of
more number of people when it comes to managing business activity because there are
various work which are required to be managed on regular basis. The responsibility of
managing day to day activity with Board of Directors of the company, Company
Secretary and manager.
Here, as per the given case K is advices they must try to incorporate corporation through
which they can easily manage their daily schedule. Even they will get the multiple option to
manage everything on given period of time.
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TASK 4
Recommend legal Solutions for resolving a range of dispute using examples to demonstrate how
a party might obtain legal advice and support.
Case Scenario: KANGO and their IT supplier had an argument with each other which
converted into legal disputes. Now, non of the party wants to involve themselves into the process
of litigation as it is one of the lengthiest method which consumes unnecessary time.
In present time, government have introduced number of methods which helps to solve the
legal disputes and among them Alternative Dispute Resolution is also one of them. Alternative
Dispute Resolution is one of the method of solving dispute which consumes very less amount of
money. In this method, neutral party is appointed who need to study the case in detail so that
advices and decisions can be given for solving issues. There are different ways through which
legal disputes are solved and they are Negotiation, Mediation and Arbitration.
 Mediation: It is the easiest and most simple method of solving disputes. Under
Mediation, there is the requirement to appoint mediator who need to handle the situation
of case. Once case has been understood, it is necessary that mediator must try to solve the
issue by giving appropriate advices.
 Negotiation: In this, the person who is appointed is required to understand the condition
of case. After that, negotiator is required to check that how he can solve the issue by
negotiating the term and condition of the agreements (Adams, 2012). Even it is the most
commonly used method ADR method.
 Arbitration: It is the most important method under Alternative Dispute Resolution
because decision given under this method must be followed by disputed parties. Here,
number of appointed arbitrator must be in odd digit and their decision cannot be
challenged in most of the situations.
Here, in the above case KANGO and their IT supplier must try to adopt Arbitration
method because that can help them to solve out there problem and issues in quick succession and
even they will not required to spend unnecessary amount of money.
CONCLUSION
From the above mentioned law and regulation, it can be understood that Commercial law
has its own importance in business field where it provide guidelines which must be considered at
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the time of taking any of the decision. When it comes to English legal system, it have mentioned
each and every detail which is useful in daily life. There are number of option available for
investor for investing their money in business activity but it is there choice that which one they
prefer. Also, Alternative Dispute Resolution helps to solve dispute in systematic manner where it
decreases the overall cost.
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REFERENCES
Books & Journals
Adams, A., (2015). Law for Business Students Mylawchamber Pack. Pearson Education
Limited.
de Silva, C. (2017). Alix Adams, Law for business studentsEwan MacIntyre, Business law. The
Law Teacher. 51(4). pp.527-529.
Adams, A. (2018). Adams. Harlow, United Kingdom: Pearson Education Limited.
Adams, A. (2012). Law for Business Students. Pearson Education UK.
Online
Role of Government in making law. 2019. [Online] Available Through
<https://www.gov.uk/government/publications/english-votes-for-english-laws-
proposed-changes/english-votes-for-english-laws-an-explanatory-guide-to-proposals>
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