Business Law Report: Legal Systems, Business Structures, and Disputes

This report provides a comprehensive overview of business law within the UK context. It begins with an introduction to the judicial method, outlining the civil, common, and religious laws that govern the economy and resolve disputes. The report then delves into the sources of UK law, including legislations, directives, case laws, and treaties. It differentiates between civil and criminal law, and outlines the structure of the UK court system. The role of the government in shaping and implementing laws is examined, followed by a discussion of the actual consequences of company, contract, and employment law on businesses. The report also explores the formation of various types of business concerns, including sole traders, partnerships, and registered companies (both public and private), highlighting their key characteristics and differences. Finally, it provides insights into the legal requirements for establishing and managing a business in the UK.

Business Law

INTRODUCTION
Judicial method is a procedures used to implement and enforce laws in the country with
described regulations that needs to be followed in several ways. Judicial method is consist of
three major laws to govern an economy which is civil law, common law and religious law.
Through judicial system in the country disputes are resolved and minimised. A fair legal system
helps in applicability of laws equally to all and gives equal rights to a fair trial. To govern
businesses a separate law termed as business law is implemented in UK. This law helps in
enhancing understanding regarding applicability of laws while running a business organisation.
Establishment of enterprise and variety of legal solutions are guided through business law
(Bayern, 2016). Impact of law on each business house and individuals involved in business will
be identified through business law.
This project report consist of detailed information regarding nature of the legal system
and potential impact of the laws on a business. Formation of different types of business
organisations and their management and funding will be elaborated. As per business law
appropriate legal solutions will be provided to resolve dispute.
PART 1
P1 Explanation for various informant of law
English judicial scheme is administrated by the courts in England and Wales, which
provides rules and regulations for civil and criminal matters. Principles of the English law is
based on the common law as it is the origin of the legal system in the country. Law is designed
for the purpose of providing set of rules to the society that helps in protecting basic rights and
freedoms through treating each one fairly. Through legal system law and order is maintained on
the basis of established standards. Disputes are resolved without making difference among any of
the individual separate in the eyes of law (Cameron and Pagnattaro, 2017). Evolution of the law
has started even before the history was recorded on the basis of various disputes arises in the
society. By 22nd century the ancient Sumerian ruler Ur-Nammu has formulated the first law code
which consist statement (“if … then....”). By 17th century, statutes enacted by parliament took
precedent over common law.
Legal system of UK id quite effective and taking all the necessary steps required for
evolution and enhancing quality of laws as per changing environment. Formulation of laws are
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based on content which is gathered and acquired from different origins. These are termed as
sources of UK law and defined as-
Source: Sources of UK law, 2019
Legislations: In UK parliament is highest authority to pass any law for the country and
these are termed as highest legislations that can not be modified by any other authority.
Legislations are termed as primary and secondary (Sources of UK law, 2019). Primary
legislations has been controlled and passed by legislature and consider both system of rules
sponsored bills and private bills. Secondary legislations are used to feed primary one and these
are termed as import source for UK law.
Directives: This is a legal act of the European Union that is applicable on its member
states to achieve set objectives. A set of rules is provided by European Union that will be
implemented in the national laws of each member state.
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Illustration 1: Sources of UK law, 2019

Case laws: Decision of the court which is given for the first time is reported through law
reports serves as one of the primary source of UK law. A benchmark case decision is used for
resolving issues involving related issue and termed as new law.
Treaties: These are the international agreement among independent government and
binding among the parties involved. Terms and conditions of treaties entered by UK serves as a
source of UK law (Cameron, 2017).
Variation between civil law and criminal law:
Basis Civil Law Criminal Law
Definition Deals with dispute arises
between individuals,
organisations and
compensation is awarded to
victim.
Deals with crime and legal
punishment of criminal
offense.
Burden of proof On Plaintiff Always on state/ government.
Punishment Compensation for injuries or
damages.
Fine and death penalty.
Case filled by Private party Only Defendant
Decisions Decisions are made on basis of
state laws.
Unanimous decision
Court structure of United Kingdom:
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Illustration 2: Structure of the Court, 2019
Source: Structure of the court, 2019
P2 Role of government in formation of law
Legislative assembly is law making authority in UK and government supports parliament
in formulation of the laws and implementing or establishing legal system of the country.
Government serves through different departments to large number of public and these
departments are face of the government. While performing various activities when any issue that
is generating on a recurring basis attracts government attention. After analysing the situation if
the issue is considered important to resolve then government develops an agenda to resolve the
issue (Structure of the court, 2019). While collecting the information that helps in understanding
the whole situation various political parties, socio-economic situations are open to represent their
point of view. On the basis of viability of the information that is checked with all permutations
and combinations an issue is identified.
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Appropriate people dealing in the sector must be consulted. For example- government in
UK has identified that individuals are not depositing their taxes on time then a new regulation for
tax filling and deposits must be implemented. In this regard tax authority and financial minister
must be consulted. After this a proposal focusing on social structure is made to parliament. The
bill will be presented to the council in parliament and it will pass through first, second, third
reading, committee and report stages (Hibschweiler and Salzman, 2017). With the approval of
House of Commons, House of Lords and royal consent bill presented become act of parliament.
The structure for the organisation of the judiciary in UK covers the following area-
 The Judicial Executive Board
 The Tribunal Judicial Executive Board
 The Judge's Council
 The allocation of day to day responsibilities
 The organisation of jurisdictional responsibilities
 The Judicial office
 Organisation of the Courts and tribunals
P3 Actual consequence of company, contract and employment law on businesses
Businesses are performing operations in the business surroundings which is highly
competitive and challenging. Implication of various rules and regulations restricts
implementation of activities in informal manner. As business deals with individuals and business
organisation such as consumers, service providers and employees etc. Together with business
law various other laws such as contract law, employment law, Tort of negligence etc. needs to be
followed by them to avoid any legal hindrance in business operations (Hjelmeng and Søreide,
2017).
Contract law: A contract is an agreement that a party can turn to court to enforce.
Formation of contract must be as per the law in businesses to make it legal. Such as it must offer
and acceptance by the parties, adequate consideration must be their. Elements of terms of the
contract must be legal and appropriate to validate it. For example- A contract for sales in future
without any amount will not be considered a valid contract as lack of consideration is their.
Competition law: It is a law that encourage or look for maintaining industry rivalry by
regulating anti-competitive conduct by institution. This law must be followed by all the business
organisations to regulate fair competition in the market. For Example- Contract between two
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companies who are leaders in the business to set price of the necessary goods high will be
prohibited as per competition law (Lasprogata and Foster, 2016).
Tort of negligence: When tort is pledged by non accomplishment to act as a sensible
person to someone to who something is owned. Businesses have to take all the reasonable care
regarding consumer protection, health and safety to avoid any negligence mentioned in the law
to minimise legal compliances.
Employment law: This law provides duties of the employer and employee while
entering into the employment contract. A proper guideline is provided for minimum wage
payments, maximum working hours, dismissal policies, discrimination at workplace, redundancy
and health and safety at workplace. All the cases in relation to dispute among employee and
employer relationship is minimised through implementing this law in business.
Company law: Business organisations established in form of a company needs to follow
this law to establish as a legal entity in the eyes of law. Company law describes regulations
regarding legal requirements for establishing as a company. Together with this minimum number
of directors, appointment of auditor, issue of share capital, registration procedure all are guided
through company law. Without following regulations of company law no business can be legally
established as company. For example- Issue of shares for initial capital must be follow
regulations of company law.
P4 Formation of various kind of business concern
Establishment of a business organisation can be in the form of incorporated and
unincorporated business structure. An incorporated business is a separate legal entity from the
business owners (Miller, 2016). This form of business possess legal existence in the eyes of law
as all the regal requirements are met to establish a business in the incorporate structure.
Unincorporated business organisations are easy to form and are conducted on the identity of the
owner. This means business and owner is one and the same person. Liability of the business or
owners are unlimited that means owners personal assets can be used to met business debts. There
are various types of enterprise which can be established in any of the form mentioned above.
Sole trader: This is the most used business form following unincorporated business
structure. Most of the businesses at its initial stage are started as a sole trader business. Sole
trader business is easy to establish as no legal requirements are their to make business registered
in the eyes of law. Owner of the business manages all the operations required to conduct
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business activities. Liability of owner is limitless and private possession can be used to settle
debt of business.
Partnership: This is another form of business following unincorporated business
structure. When two or more individuals come together to conduct a business operation with
motive to earn profits then partnership business is established (Morley, 2016). Partnership is
governed as per partnership deed that is entered by partners and all the rules of partnership are
mentioned in this deed. Partnership business do not have legal existence and this leads to
unlimited liability of all the partners in the business.
Registered company: This form of business is most popular form operated in
incorporate business structure. Companies law is applicable and registration of business as
company gives separate legal existence to business in the eyes of law. Business is registered
following all the steps mentioned in the law. Formation of business as company provides
benefits like access to more funds as capital in business through issue of shares. Liability of
owners is limited up to capital contributed by them in business.
Companies are further classified as public and private company, limited and unlimited
company.
Basis Public Limited Company Private Company
Directors In PLC there must be at least 2
directors.
A private company can exist
with one director.
Filling of accounts Accounts must be subtitled
within 6 months of the end of
accounting period.
A private company has 9
months for submitting its
accounts.
Company secretary (CS) Required to appoint CS. No requirement for
appointment of CS.
Annual meetings Must be held within 6 months
of its financial year.
No requirement.
Minimum share capital PLC must have share capita
above the authorised value
minimum of £50,000.
No minimum share capital.
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Limited company: In this form of company structure owners do not face personal
financial risk as their liability is limited up to capital contributed or ant specified amount.
Unlimited Company: In this form of company owners are exposed to potential losses
based on the companies obligation to pay its debts.
P5 Administration and financial support of legally formed enterprise
Sole trader: This form of business is managed through skills and knowledge of the
owner. Availability or access to funds for sole trader business is limited as only single individual
is available to contribute funds as capital. Banks and financial institutions do not consider sole
trader business appropriate to grand big amount as loans (Norris, 2016).
Partnership business: Dealing in partnership enterprise is managed through all the
active partners. Management of partnership business is quite effective as different partners
choose their area of excellence for management and activities are performed on time through
allocation among partners. Business is funded through capital contribution made by each partner
and through rising of funds as loans from other financial institutions.
Registered company: A company manage its operations through directors who are
appointed at the times of incorporation of business. As a public limited company requires at least
two directors for incorporation. Company secretary and auditor in business is appointed to
manage legal operations and books of accounts (Orlov, 2016). Shareholders plays important role
in rising funds for public limited company as they contribute towards capital of the company.
This form of business have largest access to funds as share capital and loans from financial
institutions. The company law will be applicable for rising capital till dissolution of business
operations in form of liquidation.
PART 2
P6 Judicial resolution for resolving range of conflict in business
Case 1: In this case Gordon works as salesman in Orange Computers Ltd store. In the
contract of employment his annual salary is mentioned as £10,000 and a commission payment at
9% of sales. In the year 2015, due to competition business is affected adversely. Manager
approaches Gordon and ask him to forgo his salary for 2015 to 2017 and simply accept
commission. Gordon accepts the variation in the contract. In 2016, the economy began to grow
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and Orange Computers Ltd managed to store its position with healthy profits. Now, Gordon
wants to receive his wages for all three years (Snyder and Maslow, 2018).
This issue will be resolved through implications of laws that are required for employment
and to enter into contract. As per contract law variation in the contract will be permissible
when parties to the contract are agreed on the new terms and conditions. In this case Orange
Computers Ltd and Gordon both got agreed to make variation in the employment contract and
forgo salary for the years 2015 to 2017. This variation was based on the financial situation of
company and when business is started earning profits Gordon will be in the position to receive
his salary for the year 2017. As it was not mentioned in the contract that when the profits will
arise then also Gordon can not claim forgo amount then only he can not claim his salary for 2015
and 2016. In the present case there is no such thing mentioned in the contract and he can claim
salary for all the three years. This issue can also be resolved through Alternative Dispute
Resolution method using the facility of mediation. A mediator will be appointed by them who is
not related to both the parties and solution will be provided by mediator which is most suitable to
them to avoid court.
Case 2: Janet decided to purchase and install internet package through Virgin Media
costing £35.00 per month including phone line rent of £11.00. The engineer came to install
internet and did not find telephone point. He left by saying that he will bring his supervisor with
him and never come back. After many complaints installation takes place 3 weeks later. In the
invoice Janet was charged for the whole package from the initial installation day.
This issue will be resolved considering contract law. As per contract law completion of
contract will be recorded when it is performed in full only partial performance will not be treated
as completion of the contractual conditions. Here, Virgin mobile only install the internet
connection but did not provided connectivity to internet. This default was on part of company
and Janet should not be charge for the 3 weeks in which installation did not took place. Company
can charge monthly rental from initial date but full package will be charged after three weeks.
Collaborative divorce facility of Alternative Dispute Resolution will help in resolving this
dispute by providing specific terms for the contract.
Case 3: In this case Black horse Limited has suffered bad debts form one of its client for
£100000. The cash flow reduction due to bad debts leads to expansion the due dates for
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payments. Creditors file a winding up petition two weeks ago and hearing will take place in three
weeks (Tepe, 2016).
This issue will be resolved through companies law. When a company is unable to pay its
debt and creditors made reasonable appeal for the payment. In this situation creditors can file a
petition to court for compulsory winding up of business operations. This issue can be resolved
through court appeal or through Alternative Dispute Resolution. Through ADR winding up of
business operations can be avoided. Creditors of the business and company can use arbitration
method to resolve this dispute. In this method a arbitrator who is a qualified judge will be
appointed to resolve the issue out of the court by providing most appropriate solution that will
help business to continue its operations and creditors to gain their due amounts.
CONCLUSION
Assessing the provided information on business law helps to conclude that understanding
legal system is important to operate business in legal manner. Legal system is formed through
various laws based on different sources. Government of UK plays important role in establishing
legal system in the country. Business is established in various forms varies on the basis of
management, funding and legal structure. Jointly with business law several laws followed by
enterprisees to work in well defined legal system of the country. Disputes that arises in business
will be resolved through provisions of the applicable law or through Alternative Dispute
Resolution whichever is best suitable for business.
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REFERENCES
Books and Journals
Bayern, S., 2016. The Implications of Modern Business–Entity Law for the Regulation of
Autonomous Systems. European Journal of Risk Regulation. 7(2). pp.297-309.
Cameron, E. A. and Pagnattaro, M. A., 2017. Beyond millennials: engaging generation Z in
business law classes. J. Legal Stud. Educ. 34. p.317.
Cameron, P., 2017. International energy investment law: the pursuit of stability. OUP Catalogue.
Hibschweiler, A. M. and Salzman, M. L., 2017. Sustainability and Corporate Governance in a
Business Law Course: A Real World Prospect. Atl. LJ. 19. p.225.
Hjelmeng, E. and Søreide, T., 2017. Bribes, crimes and law enforcement. European Business
Law Review. 28(1). pp.19-40.
Lasprogata, G. A. and Foster, T. N., 2016. Fostering Integrative and Interdisciplinary Learning:
A Business Law Exercise in Social Entrepreneurship, Global Health Innovation and
Cloud Technology. Atl. LJ. 18. p.38.
Miller, R. L., 2016. Business Law Today, Comprehensive. Cengage learning.
Morley, J., 2016. The Common Law Corporation: The Power of the Trust in Anglo-American
Business History. Colum. L. Rev. 116. p.2145.
Norris, K., 2016. Common European Sales Law: A Missed Opportunity or Better Things to
Come?. Business Law Review. 37(1). pp.29-32.
Orlov, V., 2016. Introduction to business law in Russia. Routledge.
Snyder, D. V. and Maslow, S., 2018. Human Rights Protections in International Supply Chains
Protecting Workers and Managing Company Risk: 2018 Report and Model Contract
Clauses from the Working Group to Draft Human Rights Protections in International
Supply Contracts, ABA Section of Business Law.
Tepe, M., 2016. In Public Servants We Trust?: A behavioural experiment on public service
motivation and trust among students of public administration, business sciences and
law. Public Management Review. 18(4). pp.508-538.
Online
Structure of the court. 2019. [Online]. Available through:
<https://guides.ll.georgetown.edu/c.php?g=365741&p=4199181>
Sources of UK law. 2019. [Online]. Available through:
<https://www.slideshare.net/PhilosophicalInvestigations/sources-of-the-uk-
constitution>
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