Business Law: Contracts, Negligence, and Business Mediums

This report delves into the core principles of business law, examining the requirements for a valid contract under the law of England and Wales, and assessing liability in a contractual dispute. It further analyzes the criteria for negligence claims, outlining the elements that a claimant, such as Jerry, must satisfy. The report then identifies and evaluates various business mediums available to entrepreneurs, including sole proprietorships, partnerships, and different types of limited companies, discussing their respective advantages and disadvantages. Finally, it underscores the importance of correctly classifying the employment status of workers and offers recommendations for best practices in recruitment and employment, providing a comprehensive overview of key legal considerations for business managers.

Law for Business
Managers

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. (a) Under the law of England and Wales, what is a contract and what are the requirements
for a valid contract to be formed?...........................................................................................1
(b) Would Ringo be liable to pay Paul based on the facts above?.........................................2
2. Discuss the criteria that Jerry (as the claimant) would need to satisfy in an action for
negligence...............................................................................................................................3
3. Identify the main business mediums available to Ringo and his friends John and Yoko and
the advantages and disadvantages of each of these mediums................................................4
4. Discuss why it is important for Ringo, John and Yoko to identify the correct employment
status of any workers that they recruit for their business.......................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Law is simply explained as rules & regulations which governs the nation that what is
needed to be done and what should not be done. Law for business is quite different where
authorised individuals are delegated with some responsibilities which they need to complete
within a specific time period for achieving the target of a company. All of the guidelines which
are mentioned in business law plays a huge role in commercial sector. For this particular project,
number of topics will be discussed where it will be explained that what is contract what need to
be done for any valid contract. Case study will be explained with appropriate solution. In
addition, types of business organisation will be explained and how they need to be formed with
advantage and disadvantage. At the end, process of recruitment will be described along with
offering recommendations for its improvement.
MAIN BODY
1. (a) Under the law of England and Wales, what is a contract and what are the requirements for
a valid contract to be formed?
In any of the nation there are different rules and regulation as they are commenced as per
the requirement of situation. There are number of laws which have their own importance but
contract law is paramount as it guides what is right and what are those things that need to be
avoided. Below, there is a detail explanation that what is contract and what is the valid procedure
to form it within UK.
Contact law is simply explained as law and regulation which determines the minimum
number of individuals to form a valid contract. This law has a huge importance because it
identifies the manner in which the task will be accomplished along with determination of specific
time period. There is a concept in contract law that whenever two parties agree to enter into a
contract they are not allowed to breach, if in any of the situation terms & condition has been
altered in between the contract then it is allowed to breach contract. (Allen and Kraakman,
2016). For example: A and B enters into a contract where A will give his car to be B in
consideration of £2000, but at last moment, a disagrees to sell as better offer was being given by
C. But, according to law of contract, it is unethical and even there is a breach of contract and in
that particular moment A will be legally penalised and compensate should be given by A to B. In
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addition, contract are of mainly two types, either written or verbal. There are number of other
requirements which are needed to be considered while forming any of the contact & they are:
Offer the primary stage where it is necessary that company should offer some condition
while entering into a contract. Here, mainly one party is rewarded with monetary term as per
terms and condition.
Consideration & Negotiation is the stage where offered party has to reply regarding
importance things which are to be considered while entering into contract. This stage gives
opportunity to organisation to do negotiation because afterwards, arbitration is not allowed
Acceptance is the stage which comes after competition of consideration and negotiation
process between the parties. It shows that parties are ready to perform and fulfill their part of
work.
Legal Relation is being created where legal paper work is being done by agreed parties.
Here, all of the information relating to the manner in which tasks are done are specified along
with description of terms and conditions which are applicable when breach of contract takes
place.
Validity of a contact is allowed till the completion of particular project or even time
period can be mentioned in it that how long will it take to complete any of task (Petty, 2012).
It is necessary for any of the person that they should be able to work according to above
mentioned steps while entering into any of legal contract. If in any of the case, this conditions are
not fulfilled the contract will be counted as null & void so all of this conditions are needed to be
considered by aggrieved parties.
(b) Would Ringo be liable to pay Paul based on the facts above?
In the given case, Paul and Ringo have tried to create a legal relationship by giving
offer and in return by accepting it on 10GBP. In this particular case, father has breached the
terms and condition by giving irrelevant justification that Paul is needed to be put some extra
weight but as per the contract, such aspect or term were mentioned earlier. Contract was
prepared verbally in it it. So in this situation all of the facts are against Ringo and he is liable to
pay the agreed amount of 10 GBP to his son Paul post completion of the contract. In any of the
situation, Ringo doesn't pay outstanding amount them Paul has the right to sue him as a breach of
contract. In this whole case, Paul will have much burden because they had not signed the written
contact so innocent party has to prove everything in it.
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2. Discuss the criteria that Jerry (as the claimant) would need to satisfy in an action for
negligence.
Negligence is generally referred to breach of code of conduct which ultimately results in
loss or harm to next person. Negligence under contract covers a complex mechanism that is
being applied to the circumstances so that recovery of the losses could be availed. Here, people
suffer from either financial losses or injury and they both are against the law. As per the laws and
policies, it necessary that people should be provided better form of services in appropriate
manner but due to professional negligence one party have to suffer in it (Gilani and et. al., 2014).
For the purpose of analysing negligence, it has been classified into four different terms which is
needed to be meet for falling under the criteria of negligence.
Duty is being given to the practitioner where person is being given certain work which
they need to perform. It is necessary that work should be done perfectly and in accordance to the
terms and conditions established. For example: in any of the organisation, employees are
communicated to perform their task keeping in mind the guidelines established so that best
results could be availed for the company.
Breach is the situation which arises when given duty is not being performed by party,
either they have not worked according to agreement or else they have been negligent in
following codes of ethics. For example: if employee of a company fails to perform their part of
work as they have a duty to work according to given guidelines. In this situation, there is a
breach of a contract.
Cause is referred to a something that bring effect or a result to some contract. Cause
carries which has a huge impact where it is necessary for person to prove that due to the mistake
of client one has to suffer (Hakim and Syaputra, 2013). This stage does play important role
because matter is needed to be proved here.
Harm is an important part in negligence process because it creates unnecessary problem
for one person because their reputations or property can be harmed it. The main benefit of this
stage is that it helps innocent party for resolving the problem (Blackburn and et. al., 2013). The
most crucial point over here is that harm needs to be appropriate on ground of physical, mental
or even social damage so that case can be filed against the one who has performed default.
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Result: In this particular case, it is determined that Jerry is liable for compensation
because default was done by Elixir Garden. George was the one who has not performed his task
in appropriate manner due to which Jerry has to suffer. Here, George was need to measure the
size of tree before cutting them but he didn't do that. Even, George was running out of time due
to which he didn't perform his task according to terms and conditions established. By
understanding the whole case, it is easy to identify that whole of the mistake was performed by
George and organisation have to compensate in this situation on behalf of him. The negligence in
this situation will be gross negligence. Gross Negligence is the situation where practitioner
themselves are being held liable because they don't perform their work in systematic manner
(Sichelman, 2013). Here, 100% liability arises on practitioner.
3. Identify the main business mediums available to Ringo and his friends John and Yoko and the
advantages and disadvantages of each of these mediums.
Ringo and his friends John & Yoko have got number of option available with him for
commencing the business organisation. Whenever any of the person commences any of the
business, it becomes essential for them to understand the major advantages and disadvantages so
that decision making process can become easy. Below, some of the business organisation have
been explained which be useful for Ringo and his friends.
Sole Proprietorship is a business entity who has a right to perform business at smaller
ground. This business has power to perform business activity at a smaller ground where
organisation and be managed by owner (Jennings, 2014). It is one of business which has been
established for personal survival or placing the investments in the market. This types of business
get freedom from number of legal work which makes it easier to perform.
Advantage: Documentation work are very less in sole proprietorship.
Disadvantage: Legal rights are not given sole these types of business organisation.
Partnership are the business type which performs business at a smaller ground by
coming with a common goal by number of people. This types of business are easy to perform but
certain boundaries are there which is needed to be determined. Whenever any person start
partnership they need to make sure that they are following all of the terms and condition of
partnership act.
Advantage: The variety of partner can provide different ideas through which goals and
objectives could be fulfilled.
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Disadvantage: Partnership firm also don't get the rights to sue and be sued on firms name.
Private Company Limited by Share is a business organisation which does get the right
to perform business activity at a greater platform where all of the legal procedure is needed to be
followed while incorporating it (Png, 2017). This types of business explains that shares are none
transferable in it. If any of the situation arises where share is needed to be transferred then
shareholder has the option to transfer it to relatives or other shareholder of a company who is
connected with company. It is necessary that complete procedures must be followed while
operating any of private company limited by share.
Advantage: These types of businesses have the right to sue or be sued in its own name.
Disadvantage: Paper work in these types of company are always more as compared to
other form of small companies.
Public Limited Company are the business organisation who are required to have huge
amount of capital to perform any of the business activity. There are number of legal
responsibilities which is needed to be performed by public limited company. These are those
company which provides opportunity to general public to become the part of a organisation. It is
also necessary that whenever public limited company is need to issue share in the market they
are needed to ensure that company has been registered in London Stock Exchange (Belinfanti
and Stout, 2017). Whenever this types of business organisation are needed to be formed, proper
team is required who takes any of the decision for the betterment of a company.
Advantage: Whenever organisation requires the fund to operate business activity public
limited company have the best chance because they have number of sources available.
Disadvantage: Decision making process are so lengthy which has a negative impact on
business organisation in some of the cases.
As there is number business organisation available within UK premisses but it will be
better for all of the three friends to invest their capital within private company limited by share.
This types of company are formed mainly to perform business activity at smaller ground but
rights are given more as compared to other. This types of business organisation will give them a
platform to perform better in future period of time and chances of earning profit will increase
automatically.
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4. Discuss why it is important for Ringo, John and Yoko to identify the correct employment
status of any workers that they recruit for their business.
In any of the organisation, employment status is the most important part because it helps
to find about knowledge and skills that a person (Malik and et. al., 2016). It is helpful because it
can easily help to delegate roles and responsibilities through which organisational goals can be
easily achieved. It is said that employment status plays can crucial role for any of the
organisation because it helps to determine that what are the rights that an individual must get
while working with the company. In simple words, it is a relationship between work provider
and the person who will perform the work. Basically, there are three different status of any
person and they are explained below:
 Employee- It is the status where person enters into the contract to perform certain task on
regular basis. Here, employment laws applies on employee and organisation, both and
they are needed to follow it. Whenever person work as employee, they are need to work
according to given criteria and if in any of the situation they fails then organisation is
liable in it.
 Worker- A worker is any individual who works for an employer, whether under a
contract of employment, or any other contract where an individual undertakes to do
personally any work or services (Means, 2014). Workers are the one who is entitled for
employment rights and protection. Some of the people who are known as worker instead
of employee is most agency workers, short term casual workers and even freelancers etc.
 Self-employed- They are the one who provide services by charging certain amount of
fees from the one for whom they are working. Law like employment law is not applied
on this types of people as they do not work as a worker or employee etc. Whenever this
types of people performs any types of mistake then they are personally liable instead of
charging from organisation (Du Plessis, Frederick and Maritz, 2013).
As there are different status available with Ringo, John and Yoko to choose while
recruiting any of the employees because it will help to deliver the roles and responsibilities to
person who will work for them. Here, they can easily determine that what are the rights that can
be given to person so that any sort of accident don't take place from next time. Various laws and
regulation also applies on the person when they are hired by the company (Boxx, 2012).
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Recommendation: By looking at the working style of Elixir Garden, it will be important
for them to hire self-employed for their association because it will help them to allocate the roles
and responsibilities to that person. This will make sure that company has selected right
candidate who will work according to the given terms and condition. If in any of the situation,
any of default is done then legal action can be directly taken upon hired person. This will be
helpful for their business because they will just have to delegate the responsibilities according to
the term and condition of law.
CONCLUSION
As per the above mentioned facts, it is understandable that contract law has a huge
importance in the contemporary business environment. This project defines the importance of
forming and entering into a contract prior to performing any of tasks. Breach of contract are
offence in the terminology of law. Negligence is a professional negligence where defaulter has to
compensate and that is decided according to the situation of default performed by the defaulter.
Persons are needed to decided themselves that where they need to invest capital for performing
business activities. Whenever there is recruitment process within the company it is necessary that
organisation must follow proper procedure so that right candidates can be found who can help to
accomplish the goal of an organisation.
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REFERENCES
Books and Journals
Allen, W. T. and Kraakman, R., 2016. Commentaries and cases on the law of business
organization. Wolters Kluwer law & business.
Belinfanti, T. and Stout, L., 2017. Contested visions: The value of systems theory for corporate
law. U. Pa. L. Rev. 166. p.579.
Blackburn, R. A. and et. al., 2013. Small business performance: business, strategy and owner-
manager characteristics. Journal of small business and enterprise development. 20(1).
pp.8-27.
Boxx, K. E., 2012. Too many tiaras: Conflicting fiduciary duties in the family-owned business
context. Hous. L. Rev. 49. p.233.
Du Plessis, A., Frederick, H. and Maritz, A., 2013. Education and training deficits in industrial
clusters: Empirical evidence that managers can use to rectify the skills gap in Auckland
precinct.
Gilani, S. R. S. and et. al., 2014. Islam, Shari'a Laws and International Human Rights
Compatibility for Expatriate Business Managers. Journal of Business Studies Quarterly.
6(2). p.98.
Hakim, R. and Syaputra, E., 2013. Business As Al-Amanah And The Responsibilities of Islamic
Business Managers. La_Riba. 6(2). pp.199-210.
Jennings, M. M., 2014. Business: Its legal, ethical, and global environment. Nelson Education.
Malik, М. And et. al., 2016. Motivation of manager’s responsibility in business entities of rural
tourism. Journal of Financial Management and Accounting.
Means, B., 2014. The Contractual Foundation of Family-Business Law. Ohio St. LJ. 75. p.675.
Petty, R. D., 2012. Using the law to protect the brand on social media sites: A three “M” s
framework for marketing managers. Management Research Review. 35(9). pp.758-769.
Png, I. P., 2017. Law and innovation: evidence from state trade secrets laws. Review of
Economics and statistics. 99(1). pp.167-179.
Sichelman, T., 2013. Purging Patent Law of Private Law Remedies. Tex. L. Rev. 92. p.517.
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