Business Law Report: UK Sources, Company, Employment, and Contract Law

This report provides a detailed analysis of business law, focusing on the UK legal framework. It begins by outlining the different sources of law, including Acts of Parliament, Common Law, and European Union Law, and their relevance to business operations. The report then explores the role of government in law-making and the application of statutory and common law within the justice system. It further examines the impact of company, employment, and contract law on businesses, illustrating these impacts with specific examples. The report also delves into the legal formation, management, and funding of different types of businesses. Finally, it concludes by recommending legal solutions for resolving various business disputes, providing practical examples of how businesses can obtain legal advice and support. The report emphasizes the importance of adhering to legal requirements to ensure successful business outcomes.

BUSINESS LAW
Table of Contents

INTRODUCTION.........................................................................................................................1
MAIN BODY..................................................................................................................................1
P1 Explain different sources of law and laws that organisations must comply with..................1
P2 Explain the role of government in the law-making and how statutory and common law is
applied in the justice courts.........................................................................................................2
P3 Using specific examples illustrate how company, employment and contract law has a
potential impact upon business....................................................................................................3
P4 Explore how different types of businesses are legally formed?.............................................5
P5 Explain how businesses are managed and funded?................................................................7
P6 Recommend legal solutions for resolving a range of disputes using examples to
demonstrate how a party may obtain legal advice and support...................................................8
CONCLUSION............................................................................................................................10
REFERENCES............................................................................................................................11

INTRODUCTION
Law which handles all the commercial matter is known as Business law. It is necessary
that business organisation must consider commercial law while taking any of the business
decisions because that will help them to bring out the better results in future. In context of the
given question, file will be based on business law where it will cover different segments such as
sources of law in UK which is required for business entity (What is Business Law, 2019). Role
of government will decide that how laws are commenced and even detail explanation will give
that how company, employment and contract law do have the impact on day to day transactions.
The discussion will go towards formation of company and what are the major sources of funding
and who will handle all the matter of organisation. File will be concluded by providing legal
solutions to the problem which arises on daily basis by taking four different examples.
MAIN BODY
P1 Explain different sources of law and laws that organisations must comply with.
It is said that laws are commenced everyday of different areas so that better results can be
obtained in future. There are number of laws which is commenced for business organisation
which need to be complied by taking any of the business decisions. In Great Britain, mainly three
sources are available which governs four different nation and they are Wales, England, Scotland
and Northern Ireland. The detail explanation about different sources is given below: Act of Parliament: It is important that any of the laws which has been commenced by
house of parliament should be followed because they decide what types of business
decisions can be helpful for any of the business organisation.
 Common law: It is also one of the most important part which helps to commence law
because it decides to commence law for that area where other laws are silent. Whenever
company does the default and any of the law is not commenced then decisions are taken
with the help of common law (Bargiela-Chiappini, Nickerson and Planken, 2013).
 European Union Law: It is one of the law which governs most of the part of UK because
it commences most of the laws within UK. The laws which are commenced by EU law
must be followed by every organisation which are performing their business activities in
Great Britain.
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These are some of the major sources of UK law which do commences the law for every
sector and it is necessary that business decisions should be done by considering it. Some of the
laws which has been commenced by these sources are Employment law 1996, Company Act
2006, General Data Protection Regulation 2018, Health and Safety, National Wages act and
many more. This act and laws has been explained below in detail.
 Employment law: It is one of the law which indicates that what should be the relation of
employee and employer. It provides that guidelines regarding roles and responsibility of
employer and employee (Nonet, Selznick and Kagan, 2017).
 Company Act 2006: The law which is commenced to govern any of the business activity
is known as company law. It is one of the most important law because it is the one which
provides detail knowledge about of the matter which is related to organisation.
 Health and Safety law: It is among those law which must be followed in any of the
business organisation because it related with the health and safety of the employees.
 National Wages Act: It is the act which has been passed by nation authority where they
have decided that what should be rate of wages of employees who works under any of the
person.
P2 Explain the role of government in the law-making and how statutory and common law is
applied in the justice courts.
There is the detail procedure which is required to be followed so that bill can become
new law or act. The process starts whenever member of parliament drafts the bill after consulting
the public about their wants and requirements. The first process is known as first reading in
which members have a look at points which are proposed for commencing bill. If member of
first reading approved the bill, then they transfer it for next process called as second reading
where member do the discussion in brief that what is the requirement of commencing new law as
per law because there is the possibility that amendment in any of the bill can sort out this
process. But if they think requirement is there for commencing new law then they transfer it to
next stage which is called as committee stage (Menkel-Meadow, 2013). In committee stage, it is
checked whether points which are mentioned is right or wrong and if they think points doesn't fit
then they conduct next stage where changes are to be done on some of the points and that stage is
known as report stage.
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Once bill is passed from report stage it need to be sent for third reading where member of
House of Common does the voting on proposed bill and results are in favour of bill then it is
understood that House of common are also willing to introduce new law. Now bill is required to
send in House of Lords where every single detail is checked where they also checks the positive
and negative of that proposed bill. Now, bill is required to obtain Royal Assent because bill can
only become law or act if final approval is given by queen under Royal Assent Act 1961 (Deva,
2012).
Explain how the courts use the law to make decisions. How does a judge determine how a
person is guilty?
In present scenario, mainly court declare their decision by taking the help of common law
and statutory law because they provided the clear vision to judges through which rights can be
declared easily. In context of statutory law, laws are already written and mentioned due to which
it is easy for any of the judges to check whether person is guilty. Whereas Common law support
in a different fashion in which it checks that mater of case and what can be consequences of this
case in present scenario and even in future. It is important for the judges to search about the
similar cases that might had happened in any part of the world because that will give the vision
to declare decision else judges have the power to declare the decision of own and that will be
followed by every person who is living within the country.
It is never a easy task for judges to judge that whether person is guilty or not because
there are some of the case were evidences are against the person but in reality the reason due to
which crime was done is totally different. So, judges are required to consider the evidences
which are presented in front of them and that helps to identify whether person is guilty or not.
P3 Using specific examples illustrate how company, employment and contract law has a
potential impact upon business.
In present scenario, organisation have to follow number of laws that can help to change
the status of organisation because additional number of laws are helpful for taking any of the
business decision. Some of the laws which are required to be followed by organisation are
company law, contract law and employment law.
Contract law: It is defined as the term and condition which is required to be followed by
each and every person who enters into it (Salome, 2012). The most important things that need to
be focused is contract law is that whether contract is enforceable by law or not and if not there is
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no use of forming any of the contract. Every time contract have a huge importance in any of the
business association because it decides that how work is to be done by company whenever they
enter into the contract. It is mandatory that everyone must enter into the contract because that
will help them know that what are the things that need to be covered under agreement. There are
many negative of not entering into the contract because no legal liability arises on the person
breaches the terms and condition of contract. If business organisation do not enter into the
contract they will not get the rights to sue if contracted party doesn't work as per the proper
requirement.
Company law: Company law is defined as the law which is written under Companies
Act, 2006. It is the most important law in context of organisation because it is the one which
decided that what should association do throughout the year and what are the criteria which need
to be fulfilled by organisation. Every year amendments are done in this law and even it is
important too that organisation changes their way of working as per the amendments (Nard,
2014). It is mandatory for organisation to follow and work as per company law because it
provides the guidelines for taking any of the business decisions. If any of the organisation do not
follows the rules and regulation of company’s act, then there is the high possibility that penalties
can be imposed on organisation and even in some of the cases compulsory winding up order is
also declared. Firstly, there is the detail procedure for any of the organisation to commence any
of the business. All the document is required to be submitted to Companies House and then only
they can get the right to operate their daily basis activity. If any of the organisation is not
registered under Companies Act, 2006 then that association will not be allow to perform any of
the task to earn profit and even it will fall under the category of illegal company and government
have the power to take legal action against the member of that illegal organisation. The method
of formation of organisation is different in each and every cases.
Employment Law: The law which governs the employee and employer of an
organisation is known as employment law. It is one the law which is mandatory to be followed
within the organisation. The main reason behind commencing this law is provide freedom to the
employees who works on wages system. It has set the fix pattern were none of the employees
should be discriminated and if it found then there is the chances that legal action can be taken
against them. This law has given the equal right to both employee's and employer. Both of them
are required to work as per the guidelines because that doesn't allow to create any of the legal
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dispute between employee's and employer. There are number of impacts of employment law
because it decides what should be working hour of an employee, what should be wages rate of
employee. Also, it decides how many holidays should be granted to the employee's within the
financial year where company will pay them (Esposito, 2012).
The detail description of this law shows that how important this law is for any of the
business organisation and what can be legal remedies if any of the organisation doesn't work per
the norms and values of employment law, contract law and contract law.
P4 Explore how different types of businesses are legally formed?
There are number of organisation which have to be formed legally for conducting any of
the business activity. It is necessary that proper structure should be followed whenever
organisation is required to be formed. The detail process of organisation is mentioned below
where it is mentioned that how they are required to be formed.
Private Limited Company: It is the company which is privately held for the purpose of
handling small level of business. In this type of company, it is not easy to manage day to day
activity because here involvement of outsiders are not allowed. This types of company do not
have the option to trade their share and liability of the member is limited up to the amount of
investment. Their are certain restriction which has been imposed on the members of private
limited company because they are even not allowed to transfer their share. Even there are some
of the requirements for private limited company where they should ensure that company will
work as per the Prospectus which they have prepared (Wilson and von der Heidt, 2013). The
legal process to form private limited company is explained below:
 Name of the organisation should be decided and that should be reserved till the date from
which company will start to perform their day to day activity.
 Name of every member should be listed and it is necessary that number of member in a
company should not exceed the limit.
 It is necessary that list of director should be prepared who will work for the company as
per the instructions which are given by the members.
 The amount of paid up capital should be mentioned in prospectus.
 For the purpose of detail information about the company it is necessary that prospectus
should be prepared. Once all this work is completed it must be registered under
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Companies Act, 2006 and after that all the documents should be submitted to Companies
House.
Public Limited Company: It is one of the most suitable form of business because the
flexibility which is given to public limited company is comparatively high then other form of
business organisation. Let’s understand every single detail in context of TESCO which is one of
the public limited company. This is one of the company which do get the option to trade their
share on London Stock Exchange. Here, the member of TESCO will not have to suffer form any
kind of issue because members are free and they are allow to leave the premises of company at
any time. The limit of member is not fixed because unlimited number of members can be
connected with the company (Enriques, Gilson and Pacces, 2014). Even TESCO will enjoy the
rights of perpetual succession where they can sue and even be sued on the name of organisation.
There will not be any kind of burden on member even if company do not perform better in future
period. When TESCO incorporated their company they had followed the detail procedure for
performing their daily basis activity.
 Firstly, this types of organisation is required to select name and address of the
organisation so that everyone can easily know that from where company will manage
their daily transactions.
 Then, it is necessary for them to selected the person who will work in the capacity of
shareholder till the formation of company and even he can also be appointed as the first
director of the company (Henderson, 2014).
 Whenever company wants to perform their business activity, it is necessary for them they
must select that on what area company will perform their task and duties and for that they
are required to prepare Memorandum of Association and Article of Association.
 Company is required to obtain Standard Industrial Classification Code which will help to
operate business activity.
 Then it is necessary to register themselves under London Stock Exchange so that shares
can be traded easily.
Here, TESCO will have required to submit all this documents to the Companies House so
that authority can be given to the organisation to perform daily basis activity.
Voluntary Organisation (NGOs): It is the type of business organisation where group of
same interest people enters into the agreement to conduct some of the work from which society,
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community and people can be benefited. This types of organisation do create social impact on
the people to connect with the organisation so that more social work can be done within the
country. It is one of the most difficult task to commence Voluntary Organisation because here
special permission is required to be obtained from ruling government party (Simkovic and
McIntyre, 2014). For legal formation of any of the voluntary organisation following steps are
required to be followed:
 Firstly, name of the NGO should be selected
 Purpose of forming the organisation should be prepared.
 Name of the member who will manage the daily affair are to be selected.
 Permission of supreme authority should be obtained.
 All this documents must be submitted to the Companies House.
This is the legal formalities which are required to be followed by all this organisation and if
this method is not followed during the course of formation any of the legal action can be taken
against the member of illegal association. Even different penalties can be imposed under civil
wrong.
P5 Explain how businesses are managed and funded?
After establishing the organisation is necessary that their owner should decide that how
company will be managed and funded on regular basis. It is possible only when organisation can
be able to work in a systematic manner which is described in Companies Act, 2006. The detail
description about the way through which the organisation is managed and funded is explained
below:
Private limited Company: This form of organisation is generally managed by the member
who have invested in the company where appointed manager work as per the guidance which is
given by shareholder. Even company do appoint directors who helps to deal with the situations
which is effective for organisation (Ginzberg, 2017). There are number of ways through which
private limited company is funded and some of them are
 Capital invested by the members.
 Credit cards which is handed to the company
 Hire purchase is also one of the best alternate to raise fund.
Public Limited Company: It is the business firm where manpower is required who can take the
responsibility to work as per the prepared Memorandum and Article of Association. For
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managing daily affairs company requires Managing Director, Board of Directors, Company
Secretary, Shareholders. There are number of sources available with the firm whenever they
require fund and among that sources some of them are mentioned below:
 Company can raise money through issuing share in the market if it is listed in trading
market.
 Organisation do have the option to issue debenture (Hepple, 2013).
 Governments grants is also among one of the option available with the company.
 Also company raise money through mortgages, hire purchase and many more.
Voluntary Organisation: This form of organisation requires the complete team who can
support each other to provide various kind of services to the general public. The founder has
the major role to manage daily activity followed by directors, manager and support team.
This form of organisation is mainly funded by the some of the reputed organisation or
government so provide fund so that NGO can perform better for the growth and development
of nation.
P6 Recommend legal solutions for resolving a range of disputes using examples to demonstrate
how a party may obtain legal advice and support.
There are different types of issues which can be raised within the organisation but it is
important that how it can be resolved because every time it is not possible to take the help of
court proceeding because it is one of the lengthiest way through which legal advices can be
taken. Everyday number of case are being filed in court due to which it is not easily to declare
the decision on short interval and for the purpose of solving this issue government have come up
with new plans and idea because they thought to introduce Alternative Dispute Resolution to
solve the legal disputes.
Alternative Dispute Resolutions (ADR): It is the modern approach through which legal
problem are solved which is related with the civil crime. This is one of the popular way in recent
time because process of finding the result is very quick and even charges are also very less due to
which every disputed parties can take the help of it. This approach was first used in United States
so that burden of court can be reduced through which more accurate results can be seen in future.
There are different types of ways in ADR through which disputes can be solved which is
explained below.
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 Arbitration: It is the expensive method in ADR because under this method arbitration is
appointed who tries to understand the situation of case in detail so that decisions can be
declared. Any of the decision which is declared by Arbitrator should be followed and
once declared decision cannot be challenged in any of the other court (Krishnan and
Masulis, 2013).
 Mediation: the simplest process of alternative dispute resolution is known as mediation.
Advices are to be given in this which is not mandatory to be followed by the disputed
party. Mediator are appointed in it who try to give their best to solve the dispute. This
method is used rarely because chance of dispute can be raised again in it.
 Conciliation: The process in which person has to provide advices that how they can meet
near to the agreement is known as conciliation. Conciliator are the one how give the best
advices in it. It is not compulsory for disputed party that advices which are given should
be followed because it’s their choice whether they want to follow or not.
Case 1: A ltd and B ltd were in a contract in which b use to supply the product which are
manufactured by A Ltd. Due to the occasion of festival most of the workers were on leave and
because of that B ltd cannot supply the product which they were supposed to do. Now A wants to
sue B ltd as they have to suffer from losses because of B ltd.
Solution: In this case, A and B should take the help of Conciliator who can try to reach them
near to the contract as filing the case in not the ultimate solution in this case because both of
them have to work in the same market.
Case 2: There was the agreement between Parry Ltd and Jacob that whenever anyone wants to
terminate the contract of employer and employee relationship there will be the requirement of
compulsory notice to be given before 3 months. But, Parry Ltd did give any prior notice to Jacob
and terminated Jacob without any of the reason. The decision which was declared by Parry ltd
was not right from Jacob points of view and now he is willing to file the case.
Solution: The case is simple here in which there was the fault of Parry Ltd because they should
have given the notice period to Jacob but they didn’t do that (Miller, 2013). But, it is necessary
to understand that filing a case in court will take unnecessary time of both the party so it will be
better for them to go for Mediation process where they can take the advice to solve the dispute.
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