Unit 7 Business Law: Analysis of Legal Systems and Dispute Resolution

This report delves into the intricacies of the English legal system, encompassing both common and statutory law. It begins by exploring the sources of law, the government's role in law-making, and the application of statutory and common law within justice courts. The report then examines the impact of company, employment, and contract law on businesses, differentiating between legislation, regulations, and standards. Furthermore, it investigates the legal formation, management, and funding of various business organizations, assessing their advantages and disadvantages. Finally, the report recommends legal solutions for dispute resolution, providing examples of how to obtain legal advice and support, while evaluating the effectiveness of these solutions. The report aims to provide a comprehensive overview of business law concepts and their practical implications.

Law, the Legal System
and some Legal
Solutions

Table of Contents
INTRODUCTION ..........................................................................................................................4
TASK 1............................................................................................................................................4
P1 Explain different sources of law............................................................................................4
P2 Explain the role of government in law-making and how statutory and common law is
applied in the justice courts.........................................................................................................5
M1 Evaluate the effectiveness of the legal system in terms of recent reforms and
developments...............................................................................................................................6
TASK 2............................................................................................................................................6
P3 Using specific examples illustrate how company, employment and contract law has a
potential impact upon a business.................................................................................................6
M2 Differentiate between legislation, regulations, and standards to analyse potential impacts
upon a business. .........................................................................................................................7
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 judgements................................7
TASK 3............................................................................................................................................8
P4 Explore how different types of business organisations are legally formed...........................8
P5 Explain how business organisations are managed and funded..............................................9
M3 Assess the advantages and disadvantages of the formation of different types of business
organisations...............................................................................................................................9
D2 Critically evaluate the formation of different types of business organisations. .................10
TASK 4..........................................................................................................................................11
P6 Recommend legal solutions for resolving a range of disputes using examples to
demonstrate how a party might obtain legal advice and support..............................................11
M4 Compare and contrast different sources of legal advice and support for dispute resolution.
...................................................................................................................................................13
D3 Evaluate the effectiveness of legal solutions, legal advice and support for dispute
resolution...................................................................................................................................13
CONCLUSION .............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
The English legal system contains both common and statutory law which have common
and equal relevancy and validity. The common law consists of judge made law which is made
through judicial precedents and the statutory law is such which is made by the Parliament who
have the supreme authority to enact the law. There are different laws which are made by the
parliament in order to maintain law and order in the society. The business contributes majorly to
the economy and runs with a motive of profit making (Shi, Liu and Shen, 2018). It is necessary
to regulate the business which requires rules and regulations to run it. The business law is a vast
field which includes contract act, employment law, companies act, data protection act,
intellectual property laws and many other. This report shall deal with basic nature of legal
system, potential impact of law on business and different types of business organisations. Further
it will cover appropriate legal solutions for different disputes.
TASK 1
P1 Explain different sources of law.
The English legal system consists of different laws which are taken from different
sources. These sources are discussed below-
Primary source
These are the original and the authoritative statements of the laws, these include-
 Legislations- These made by the supreme authority of the country which is Parliament. It
contains two houses which are House of Lord and House of Common and also includes
the Head of the State. These are called the statutory law. Case laws- These are the decisions of the court. It includes facts, issues and the
judgement which becomes the law through judicial precedents. The court either interpret
the existing law or brings on the new law from the cases (Kelly and et. al., 2020).
Secondary source
These are referred to as the commentaries of the law. It includes-
 Legal encyclopedia- It involves key points, legislations and cases. These are considered
as the starting point for the research.

 Parliamentary and non Parliamentary publications- It contains the background of the
law and involves consultation papers, debates and discussions of the Parliament while
enacting any law.
 Law Journals- It is a mix of the case commentaries and articles which helps in
understanding the legal issues.
 Text books- It involves the content written by the academicians for the students in order
to make them understand the law. It is the best place to start a research (Miller, 2016).
P2 Explain the role of government in law-making and how statutory and common law is applied
in the justice courts
The government has the supreme authority to enact the law which is called the statutory
laws. It is made by the Parliament which consists of House of Lords, House of Commons and the
Head of the State. Firstly a bill is introduced in the Parliament and then the procedure is begin to
make the law. The Bills can be be presented in either House and both have their set stages to
examine, debate and suggest the changes to be made in the draft. The procedure for law making
in the Parliament is discussed below- First reading- In this, the bill is arrived in the House. It involves a formality where the
name of the bill is read. Second reading- Here the debates begins on the key areas and purpose of the bill.
Discussion is done on the specific area or concerns where the changes are needed.
Generally no votes are taken at this stage. Committee stage- In this, the detailed line by line scrutiny is done of the text with the
amendments. The scrutiny is done from the start to the end and votes are taken at this
stage. Report stage- Another opportunity is given to examine the bill and amendments are
debated. Votes take place in this stage. Third reading- It involves closing the loopholes of the bill as it the last chance for the
amendments. Consideration of amendments- Under this stage, if Lords have made the changes, it is
send to the Commons for agreeing. The Commons may accept or reject it. There are
several rounds of it which is called the Ping Pong (Graw and et. al., 2019).

 Royal assent- In this after both the houses pass the bill, it is sent to Head of the State for
the royal assent in order to make the law.
How statutory and common law applied in courts
The statutory and common law is applied in the courts. The English Legal system
contains two types of court which includes superior and sub ordinate courts. The superior courts
include the Supreme court , which is the highest court of appeal. It was established in 2005 under
the Constitutional Reform Act of 2005, then is the Court of Appeal which hears appeal from
other tribunals and courts. Last is the High Court which function as both appellant court and the
court of first instance. It has three divisions which includes Queen's bench, Family and Chancery
Division (Abril, 2016).
The subordinate courts includes County court which hears the civil case, Family court
which deals with family and matrimonial proceedings, Magistrate court which hears criminal
cases and the Youth court which deals with cases of youth under the age of 18 years.
M1 Evaluate the effectiveness of the legal system in terms of recent reforms and developments.
The English legal system have developed from the past years. It has been reformed from
time time as the per the evolution of the society. As the society changes so is the law. The courts
of the UK has the duty bring the new laws or make amendments in the existing law as per the
needs of the societies which changes every now and then. For instance, earlier there was no
Supreme court of UK but as the need arises, this court was established which become the highest
court of appeal and replacing the House of Lords. Then reforms were made in the County court
in 2013 and Family court was established in 2014. These changes were made according to the
requirement and reforms and developments take place gradually in the UK system.
TASK 2
P3 Using specific examples illustrate how company, employment and contract law has a
potential impact upon a business.
The business is regulated by the rules and regulations which are made to maintain the law
and order. The business law is the vast field which contains numerous laws which have their
potential impact on the working of the businesses and companies. The following is the laws
which have their impact on the business which is discussed below-

The contract law regulates the rights, liabilities, obligations, conduct and relation of the
parties who have entered into a valid contract. Every transactions nowadays is regulated by the
contract in order to prevent the fraudulent activities. This law helps the in eliminating the chance
of breach and in case the breach occurs, this law provides remedies to the party who is aggrieved
by the breach of contract. The remedies which are provided by this law includes the damages,
specific performance of the contract, repudiation and many other (Murray and Watson, 2019).
The companies law deals with all the aspects of the company from its incorporation to its
winding up. This law regulate the functioning of the companies and provides rights and
obligations of the stakeholders. The companies law of UK is the lengthiest one as it contains
1300 sections which covers every aspect of the working of the company. This law has the
potential impact on the business as it looks into the functioning and provides penalty in case any
fraudulent activity or illegal act.
The employment law provides the rights to the employees and protect them from any
kind of exploitation. It is a vast area which contains different legislations under it which includes
National Minimum wages Act, Equality Act, Employment Rights Act, Health and Safety at
Work Act and many other. These laws provides the rights and obligations to the employer and
employee and protect them from any discrimination or unfair act. It also covers the employment
contract in order to bring transparency in the working of the business so that the employees and
the employer work according to the terms and conditions noted in the contract (Daradkeh, 2017).
M2 Differentiate between legislation, regulations, and standards to analyse potential impacts
upon a business.
The legislations are the laws which regulate the working of the society. Its main purpose
is to maintain the law and order. On the other hand, the regulations are the standards which are
used to monitor the services and act as guiding principles to implement the law. Standards are
the benchmark or the recommended principles behind the work.
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 judgements.
The English legal system consists of the statutory and common law which have equal
validity and relevancy. The statutory law is the laws which are made by the Parliament who have
supreme authority to make law and common law is judge made law which are made from the

judicial precedents. The statutory law is made after a detailed procedure which is followed by the
Parliament which involves a process where a bill is passed to make a law.
TASK 3
P4 Explore how different types of business organisations are legally formed.
There are different types of business organisations which have their unique
characteristics and features. The business organisations are run with the sole motive of profit
earning and contribute to the upliftment of the society. The different forms of business
organisations is discussed below- Sole proprietorship- This business requires only 1 owner who is entrusted with the
responsibility of managing the day to day operations of the business. The owner is
personally liable for all the debts and liabilities of the business and has unlimited liability
for the same. All the profits and losses belong to the owner and is liable to pay the
personal tax after filling the self assessment. The firm is required to have a registration at
the HMRC. Partnership- This business organisation involves two or more people who have opened
the partnership firm to carry on the activities of the business. The partners share the
profit, loss, responsibility and decision making of the firm. There are two types of
partners, one is general partnership where the partners have unlimited liability and can be
liable for the negligence or misconduct of the partners. This partnership is formed by th
registration in the HMRC and requires a partnership agreement. Another form of
partnership is limited liability partnership which have the limited liability to extent of
their capital contribution. This LLP requires registration at HMRC and Companies
House. The partners in both types of partnership are required to pay personal tax
(Gamede and Uleanya, 2019)..
 Company- This business organisation requires a lengthy process to incorporate the
company as well as the winding up. The company is an artificial personality which has
its common seal. It is a separate legal entity distinct from its owners. There are two types
of companies, one is public company which raises its share capital by inviting
applications from general public and the other is private company which has the owners
who are called the directors. Another type of company is limited liability where the

owners have limited liability to the extent of their share and the unlimited company
involves unlimited liability of the owners. In order to form the company, registration at
the Companies house with a lot of documentation submission. It involves huge cost as
compared to other business organisation in order to form it.
P5 Explain how business organisations are managed and funded.
There are different business organisations which are managed and funded according to
their structure. These are discussed below- Sole proprietorship- This business organisation has single owner who manages the daily
activities of the business. The owner is responsible for all the actions and liabilities of the
firm. It requires little funding for starting up and may be funded either by the savings of
the owner or through a bank loan. Partnership- This business organisation requires two or more partners who are
responsible to manage the affairs of the firm. They mutually decide their share of
responsibilities and decision making authority according to their capital contribution or as
stated in the agreement. This is funded by capital contribution by all the partners which
can be managed either by own savings or a bank loan.
 Companies- These are managed and funded according to their type of company. The
public company is managed by the board of directors elected by the shareholders who
represent their interest and is funded by raising the share capitals through invitation of
application from the general public. The private company on the other hand is managed
by the owners who are called the directors and is funded by both equity and debt
(Slaughter, 2018).
M3 Assess the advantages and disadvantages of the formation of different types of business
organisations.
Every business organisation has different structure and is managed and funded according
to their types and legal structure. Each carry their pros and cons which help the individuals to
decide which business structure is beneficial for their offering to offer. The advantages and
disadvantages of different business organisation is discussed below-
Sole proprietorship-
Advantages -
 It involves single owner who is solely responsible to handle the operations of the firm.

 All profits are of the owner.
 Its process of incorporation is easy with just a registration at HMRC.
Disadvantages-
 the owner is personally liable for the loss and debts.
 It is difficult to sell the business. In case the owner dies, the business is dissolved.
Partnership
Advantages
 The partners share the responsibilities and mutually mange the business.
 The incorporation process is easy with just registration in HMRC.
 The capital is mutually contributed by all partners.
Disadvantages
 The decision making power is divided between the partners.
 There may arise difference of opinion among the partners. In case, any partner wishes to leave, the firm is dissolved in case of two partners (Håstad,
2020).
Companies
Advantages
 The capital is easy to raise.
 There is less financial risk involved.
 The directors are not personally liable for the debts.
Disadvantages
 The process of incorporation is complex and involves huge cost.
 There is a lot of administration process involved.
 There is complex procedure for winding up.
D2 Critically evaluate the formation of different types of business organisations.
There are mainly three types of business organisation which work according to their set
structure. They have different ownerships and liabilities which are distinct as per their legal
structure. These business organisations are funded accordingly. For instance the partnership and
sole proprietorship is funded by their owners whereas the company is funded either by raising
share capital or through debt or equity. Same way their ownership also differ like for instance,

sole proprietorship have single owner and partnership have 2 or more. The companies differ in
their ownership as public company require minimum 7 members and private company require
minimum 2 members.
TASK 4
P6 Recommend legal solutions for resolving a range of disputes using examples to demonstrate
how a party might obtain legal advice and support.
There are the courts established in the UK which helps in solving the disputes. The UK
legal system offers different alternatives apart from litigation to solve their dispute. This is called
the alternate dispute resolution. The Civil Procedure Rules of 1986 states the alternate dispute
resolutions which are cost effective and takes less time to resolve the dispute (De Luca, 2017).
These include arbitration, conciliation, mediation, negotiation and many other in order to solve
the dispute.
With the help of following case studies, the legal solutions shall be explained which are
available for the parties in order to solve the dispute or obtain legal advice.
Case study 1
This case scenario talk about the unfair dismissal where an employee claimed that he was
dismissed from the job due a complaint from the customer regarding his dress and lack of good
manners. The High street shop in the east London is in dispute as it has fired the employee with
no explanation and he worked for six months.
Under this case scenario, the parties can opt for the resolution of mediation. It refers to
the process where an independent mediator is appointed who provides suggestion to the parties
in order to reach a amicable solution. It is not binding but works as advice for the parties (Wheat,
2019).
This solution is recommended because the employee is fired from the job and was not
allows to give its explanation and his right is infringed as he/she is unfairly dismissed. The
reason of the dismissal is vague as he did not commit any fraudulent activity or misconduct
which could result in its dismissal. So through mediation, the parties can solve their issue.
Case study 2

This case is about recovery of money. The business Yemen has not received payment
from last three years from its client who have been supplied by the company. The organisation is
in danger of liquidation so it need funds to protect the company from going into liquidation.
In this case scenario, the party Yemen is advice to opt for negotiation. It is a process
where a negotiator is appointed who advice the party in order to solve their dispute. The decision
of negotiator is not binding but when parties agree to bring a negotiated agreement, it is legally
binding on the parties (Bix, 2020).
This method is opted for this case study because the debt which is claimed by Yemen is
of past three years which may take long time. So through negotiation, the parties can settle the
dispute quickly as company is in danger of going into liquidation. Moreover, through
negotiation, the suggestion can be given to Yemen in order to recover its money from the
suppliers
Case study 3
under this case study, a shopkeeper owes £25000 to supplier. The shopkeeper is unable to
pay to the supplier as it has cash flow problems. The business is in danger of going into
insolvency and this dispute can lead the shopkeeper to bankruptcy.
For this case scenario, mediation is suggested. It is a process where an independent third
party is appointed as mediator who work to solve the dispute by providing suggestion to the
parties. It is not binding on the parties (Plass, 2020).
This method is suggested to the party as the shopkeeper has to save itself from turning
into bankrupt. Through mediation, the shopkeeper can convince the supplier and take time to
repay the amount as the business is suffering from cash flow problem. The mediator can help the
shopkeeper to convince the supplier and take time.
Case study 4
This case scenario is about recovery of cars as a garage who has provided rental car to the
business has gone into the liquidation but is unable to recover the same.
For this case study, conciliation is suggested. It is a process where a conciliator is
appointed who after examining the facts and evidence, provides a decision which is called the
settlement. It is binding on the parties (Tan, 2020).
This method is suggested to the party as garage has to recover its rental car from the
business which has gone in the liquidation. Through conciliation, a binding decision can be

brought and the garage shall be able to recover its car. A conciliator can be appointed by both
parties so that there is no chances of biasness and the recovery can be done in less time and cost
as compared to litigation.
Case study 5
Under this case study, four workers were made redundant as they were late for the work
for the whole week without communicating the authorities. The workers sued them for unfair
dismissal.
For this case scenario, Arbitration is suggested to the parties. This is a process which
involves appointment of the independent arbitrator who after examining the facts of the case and
evidence on record, pass an award which is binding on the parties. It involves less time and cost
which shall be suitable for the parties (Smits, 2016).
This method is suggested because through arbitration, the matter of unfair dismissal shall
be sorted effectively as it is same as litigation but is distinct from the level of time and cost
which is involved. There has been an infringement of the right of the worker as they are unfairly
dismissed which is violative of Employment Rights Act. And this legislation provides remedy tot
he worker and punishes the employer in case of unfair dismissal.
M4 Compare and contrast different sources of legal advice and support for dispute resolution.
There are different sources of advice which can opted by the party in order to resolve the
dispute. These advice is taken by the professional lawyer who is under the professional
obligation to advice the party. The lawyer advices the party and suggest them alternate dispute
resolution in order to solve their matter or issue. These alternate resolution includes the
arbitration, conciliation, negotiation and mediation which can be opted by the parties in order to
solve their dispute outside court without involving any legal proceedings.
D3 Evaluate the effectiveness of legal solutions, legal advice and support for dispute resolution.
There are different legal solutions available to the party which seeks the resolution of the
dispute the parties can opt for apart from litigation, other alternatives which includes arbitration,
mediation, conciliation and negotiation. These work according to their structure. For instance the
mediation is not a binding process where as negotiation can be made binding after entering into
negotiated agreement. The arbitration award and conciliation settlement are the decisions which
are binding on the parties. These alternate dispute resolution are cost and time effective as