Carters LLP Report: UK Legal System, Business Formation and Solutions

This report provides a comprehensive overview of the UK legal system, addressing various aspects relevant to businesses. It begins by outlining the different sources of law, including primary and secondary sources, and elucidates the role of the government in law-making, with specific examples of how statutory and common law are applied within the justice courts. The report then delves into the impact of contract, company, and employment law on businesses, using Tesco plc as a case study to illustrate these concepts. Furthermore, it explores the legal structures of different types of businesses, such as sole traders, partnerships, and corporations, and explains how these businesses are managed and funded. Finally, the report concludes by providing practical examples of business situations and their corresponding legal solutions, including arbitration, negotiation, and mediation.

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Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
TASK 1............................................................................................................................................1
Describe different sources of law and the role of government in law-making and how
statutory and common law is applied in the justice courts.....................................................1
TASK 2............................................................................................................................................2
Discuss the impact of contract, company and employment law on the business of Tesco plc2
TASK 3............................................................................................................................................4
Discuss how different businesses are formed legally.............................................................4
TASK 4............................................................................................................................................6
Explain how the above businesses are managed and funded.................................................6
TASK 5............................................................................................................................................7
Provide specific examples of different business situations with different legal solutions.....7
CONCLUSION................................................................................................................................8
References:.....................................................................................................................................10
Books and Journals...............................................................................................................10

INTRODUCTION
A law and legislations has a different meaning as well as different functions in the every country
as per their judiciary and the legal system. Every law has a significant meaning for the different
things on the different situations and time. Law is a structure of rules of actions that binds
citizens of the country into a legal force so that there is no misconduct done by citizens. The
basic functions of the laws are to maintain the peace, status, preserve the individual rights,
protect and promote the social justice (Partington, 2018) . Legal system consists of the various
kinds of law that includes common law, civil law, criminal laws, religious laws etc. The
following report outline the nature of UK legal system on the basis of the sources of law role of
government in law making and how the statutory and the common law is applied in justice courts
of UK. Further, in the report with the example of "Tesco plc" – a UK’s largest multinational
retail company based in Welwyn garden city, England, the impact of contract, company and
employment law on business is described. Moreover the legal structure of different businesses
and how they are managed and funded is explained in the report. At last using the specific
examples of different businesses within the UK the legal solutions of the business disputes that is
arbitration negotiation and mediation are outlined in the report.
MAIN BODY
TASK 1
Describe different sources of law and the role of government in law-making and how statutory
and common law is applied in the justice courts
Law is the set of rules that are enacted on particular subject for the justice and peace by the
government of UK. England and Wales contain a common legal system with various laws known
as English law, mainly comprised of criminal and civil law, each one of them having its own
courts and procedures (Bocharov and et. al., 2019) . The sources of law in UK at divided into the
two categories primary source of law in the secondary source of law. The primary source of law
includes itself as the statements of laws of the UK that includes legislations and case law. While
the secondary source of law includes legislation case law European Union law European
convention human rights.
Role of government in law-making
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The government plays the vital role in forming the laws of the country as these are the governing
bodies that it directs the legal structure of every country. The government is formed by the
various leaders of the country that decides how the country will be operated with the legal norms
(Duddington, 2019).
The Government of UK consists of a prime minister and is supported by cabinet and its junior
members. This government is elected by Citizens for every five year. The government does not
make a law that is done by the parliament which is formed with government and other appointed
members. The Government is responsible for deciding how the country is run and for managing
things, day to day. They set taxes, choose what to spend public money on and decide how best to
deliver public services, such as:
The National Health Service
The police and armed forces
Welfare benefits like the State Pension
The UK's energy supply
Role of parliament:
The job of parliament is to look closely at the Government's plans and to monitor the way they
are running things (Bell, 2018). Parliament work is to make sure that Government decisions are:
Open and transparent – by questioning ministers and requesting information
Workable and efficient – by examining new proposals closely and suggesting improvements,
checking how public money is being spent and tracking how new laws are working out in
practice
Fair and non-discriminatory – by checking that they comply with equalities and human rights
Laws and by speaking up on behalf of affected individuals
TASK 2
Discuss the impact of contract, company and employment law on the business of Tesco plc
Contract law
Contract law refers agreement between the two parties that binds them in applications which are
recognised by the law. UK's contract law is a law regulating the contracts within the England and
Wales (a legal jurisdiction covering two fourth part of UK). In context of Tesco the company
manage to implement the contract law within its organisation by duly signing in the contract with
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their employees, customers and business partners so that company can avoid the
misinterpretation and miscommunication thereby a abiding the employees, customers and
business partners legally to conduct the various business activities that supports the performance
and productivity of the company in the market (Dickson, 2018). The contract is a written legal
document signed by the government of UK which acts as a proof during the time when there is a
non compliance or breach by the opposite party when they fails to act as per the contract.
Impact of contract law on Tesco plc
 A contract has a positive impact on the business function of the Tesco as it binds the
employees, customers and stakeholders to work as per the rules mentioned in the contract
avoiding the disputes and the conflicts between the partners employees and customers
which provides the good reputation to the firm.
 The contract also provides the transparency and clarity of profits, debts and investment
shared by the partners of the Tesco that supports the rights and security of both the
parties.
Company law
Company law of UK regulate the business organisations that are formed under the
company’s act 2006. This law is the primary legal vehicle of a business organisation to operate
and run their businesses. The companies act 2006 what's the longest law of legislation which was
enacted under legal structure of UK. Company law of the business are known as the corporate
laws that are required to legal rules and regulations and laws regarding the company. This rules
and regulation direct the operations management and the ownership of the company in context of
Tesco the company conduct the business operations effectively and efficiently with utilisation of
the company law within the organisation to attend the long term goals and objective of the firm
(Roberts, 2018).
Impact of company law on Tesco plc
 The company law provides the Tesco with legal structure that will help the company in
organising, planning and controlling the various operations of the firm. With the
company law the company will also be able to improve is the legal process liabilities and
the code of conduct directly to the business law.
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 The impact of company law on the business of Sainsbury is the company is easily be able
to identify and resolve the disputes constitutional documents and protect the interest of
the stakeholders.
Employment law
Employment law is designed to protect the rights of the workforce of an organisation this law has
a direct influence over the human resource of an organisation like Tesco the implementation of
employment law in the business functions of the Tesco helps the company in building positive
and healthy working environment that provides the greater level of satisfaction to the employees
of the company (Thirlway, 2019). Employment law there are various aspects like medical leave
retirement hiring wages and benefits discrimination and harassment working conditions extra
that helps the Tesco in developing the healthy relation with their workforce under the
employment law there are the several acts that plays a significant role in the business function of
Tesco such as age discrimination, and employment law, minimum wages act family, medical
leave or maternity leave etc.
Impact of Employment law on Tesco plc
 Implementation of minimum wages act Tesco provides their employees with the fair and
adequate amount of minimum wage rate as per announced by the government of UK with
the purpose of increasing this income and the standard of living within an organisation
that helps the business and retaining their employees.
 Anti -Discrimination and harassment act within employment law of the Tesco helps the
employees of the in getting equal opportunity without any discrimination. Also provide
good brand image to the Tesco in the market where other competitors operate.
TASK 3
Discuss how different businesses are formed legally
It is very important to know in which business type an organisations is considered in so
that a company can understand the legal formation of the business to operate the company by
following all the legal rules and regulations. The business of classified into the three major
Different types of businesses that are discussed underneath with their different legal formations.
The types of businesses in UK are:
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Sole trader: The sole traders are also known as the sole proprietorship is the businesses that are
owned by single person. Therefore legally all the profit of the property are owned personally by
the owner after paying the taxes and all the tremendous losses and risk related to business is also
responsibly taken by the owner only.
Formation and closure
This type of business requires no legal conventions to form the organisation as it is
formed by the owner himself sometimes there is a little requirement of legal formalities like the
particular licence or certificate in order to run a business and the closure of a business is totally
in the hands of the owner which requires no legal permission (Lienen, 2019).
Legal requirement by UK law
The owner of sole trade is required to register the name of the business under the HM
revenue and customs so that they can become member of self employed for tax and National
insurance purposes. They are also required to keep the business records and submit annual tax
returns for all the income from self employment and other work. If the revenue of sole trader is
more than £85000 year then it is required under the legal laws that they must register themselves
into the VAT (value added tax).
Partnership: The partnership is a business where new ownership of the company is shared
between two or more partners. The partnership businesses the financial and the legal
responsibilities are equally divided between the partners according to the legal contract signed in
the starting of the business.
Formation and closure
A partnership Business is formed in advance with the mutual interest of the two or more person
with the investment of fund by each partner. Legal contract is formed between the partners to
define the rules of sharing profits, debts and the percentage of ownership on the basis of capital
invested by each partner. The closure of business can only be done with the consent of each
member in contract.
Legal requirement by UK law
The legal requirement of the partnership business is same as the sole proprietorship where the
name of the business is required to be registered under the HMRC (Jolly, 2018). Each partner is
required to register for the self employment and should be the separate text written according to
their shared profit in the business.
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Corporation: The most complex business type in the UK which is fully independent and is
owned by the shareholders. This means the corporations trade in the stock market where the
ownership shares of the corporations are sold publicly to trade in market.
Corporations are with unlimited liabilities and have multiple taxes to pay. Corporations are
treated as a legal person. Under the legal requirements the corporation has the same rights and
responsibilities like an individual it can be taxed, sued, enter into a contract or bring a lawsuit.
Basic kinds of corporations are C corporations that are the most common form in which taxes are
deducted as a individual person but as a disadvantage can also be doubled. Another is S
corporation which has different limitations of liability and tax purposes (Menkel-Meadow,
Schneider and Love, 2020). They are required to have the hundred stakeholders and the profits
and losses are shared between the shareholders on their personal income tax returns.
TASK 4
Explain how the above businesses are managed and funded
Business is managed by its owner or the manager for the smooth functioning of the
organisation to accomplish the goals. There are many departments that are required to be
managed within organisations as a finance, marketing, human resource, production, supply and
risk (Collins, 2018). Corporation business is managed and run by the directors and the officers
that are appointed by the shareholders and the responsible for the overall of management and the
governance of the corporation. Where the sole proprietorship is is a small form of a business that
are managed and owned by the single person as they don't have many departments therefore the
owner of the company look after the various activities of the organisation. Partnership is
managed by the different partners of the business that divide the management of the various
departments within themselves for the fast execution of task and also to maintain the conflict free
partnership. For the management of the businesses owners, partners and the shareholders of the
firm set the objectives that lead them towards achieving the common goal and provide the
significant leadership to the employees for the attainment of the goals and design proper
management hierarchy for the effective productivity and performance of employees.
Cash is lifeblood of any business therefore, every business is require the source of
funding either internally or externally in order to start, expand and grow the business for the new
projects. These funding can be seek from the variety of source. Owners or the financial managers
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of the business decide what source of fund must be chosen in order to invest in a business. The
several source of funding are:
Bootstrapping: Bootstrapping also known as a self funding is the most efficient and effective
way of funding a new business because it gives an advantage of keeping all the profits and
ownership of business. Bootstrapping should be considered as the first step for financing the
business this can also be done by asking family and friends to contribute as it does not include
any interest rate. The source of funding is highly suitable for the sole trader businesses.
Crowd funding: Crowd funding is the new method of source of funding which has gained the
popularity in past few years where the business owners search for the multiple investors bye buy
a advertising the business plan and profits related to the business over the online crowd funding
sites by which businesses raise money to launch a specific product (Pearce, 2018). Best thing
about crowd funding is along with the financing it also helps in the pre-marketing of the product.
Bank loans: Taking the loan from the bank is the most common way of financing the business
for which business is required to pay particular amount of interest in regular period of time to the
bank. In order to take the loan from the bank a business is required to provide the bank with
some kind of collateral so that if the business owner is not able to pay a the particular amount to
the bank in future the bank can seize the collateral of the owner. Charitable trusts organisations
can access the loans from bank without collateral (Davies, 2020).
TASK 5
Provide specific examples of different business situations with different legal solutions
In the usual running of the business many companies face business disputes and that might
lead to the fall of a business profitability and productivity for long time. There are some legal
solutions that a business can adopt or acquire during the time of any business disputes or
situations that is hindering the image of the company in the market. But these disputes can be
solved with the help of legal solutions like mediation, litigation, arbitration or negotiation.
 Disputes related to partnership and shareholders: Another type of problem which
business face is having fights or quarrels with the competitors or the other stakeholders
with regard to executing business activities. For instance, Unilever Plc has been dealing
with major disputes with its business partners related to decision making who have
contributed to disturbance in the management and business activities. One of the
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significant legal advice for handling the commercial disputes is through Mediation,
where a mediator who is an unbiased person, understand the concern by listening
attentively to both the parties unbiased and on the basis of their needs reach on a
conclusion where both the parties mutually agree (Menkel-Meadow and et. al., 2018).
 Wage related issue: The dissatisfaction of the wages and pays off the employee is the
major issue that is faced by the organisation related to their workforce. UK’s biggest firm
Next PLC has also faced this controversy related to the issue of their workforce regarding
the wage and the benefits. In order to resolve the issue with their employees the company
took the problem management strategy as a legal solution of arbitration where using the
contract which is signed between the employees and the company is used as a proof
abiding with the law that it is no misconduct by the form regarding the wage of the
benefits of the employees also the company consider the requirements of the employees
regarding the new wage system to foster the good relations with their employees and to
avoid the disputes and the conflicts in the company (Jenkins, 2021).
 Intellectual property issue: There are many trademark issues within the large companies
that that become the problem for the company's image and profitability and productivity.
For example the H&M faced the issue of intellectual property right on its logo and name
used by another firm for which company used the litigation legal solution thereby
claiming the issue in civil justice court. The litigation legal solution is used of the courts
and the civil justice system to resolve the legal controversies. Litigation is a process
started with filing a lawsuit in the court of England, UK.
CONCLUSION
It is concluded from the above report that it is very essential for every organisation to have
legal system that maintains the peace and protects and preserve the rights of the individuals
within and outside the country. Within the business the contract, company and employment law
are the most mandatory laws that craft the base of legal structure of the business in order to
sustain their businesses legally. Every business have some kind of disputes with their
competitive company order to resolve those issues and disputes outside the justice court there are
some legal solutions such as mediation arbitration and negotiation it helps the businesses resolve
those disputes within themselves without the involvement of the judiciary. Hence negotiation is
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the one the most popular legal solution among businesses. Therefore it is necessary for the
businesses of the nation to implicate the grounds of their business legally correct and ethical.
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References:
Books and Journals
Bell, J., 2018. Sources of law. The Cambridge Law Journal. 77(1). pp.40-71.
Bocharov, V.A and et. al., 2019. Legal regulation sources for the uk contractual relations.
Collins, S., 2018. Ethics of care and statutory social work in the UK: critical perspectives and
strengths. Practice. 30(1). pp.3-18.
Davies, P., 2020. Introduction to company law. Oxford University Press.
Dickson, B., 2018. Law in Northern Ireland. Bloomsbury Publishing.
Duddington, J., 2019. Ministers of Religion in UK Civil Law: Obstacles to Employment Status
and Potential Reforms to Achieve a Degree of Employment Protection. The University of
Manchester (United Kingdom).
Jenkins, J., 2021. International construction arbitration law. Kluwer Law International BV.
Jolly, A., 2018. No recourse to social work? Statutory neglect, social exclusion and
undocumented migrant families in the UK. Social Inclusion. 6(3). pp.190-200.
Lienen, C., 2019. Judicial constitutional comparativism at the UK Supreme Court. Legal
Studies. 39(1). pp.166-182.
Menkel-Meadow, C., Schneider, A.K. and Love, L.P., 2020. Negotiation: processes for problem
solving. Wolters Kluwer.
Menkel-Meadow, C.J and et. al., 2018. Dispute resolution: Beyond the adversarial model. Aspen
Publishers.
Partington, M., 2018. Introduction to the English Legal System 2018-19. Oxford University
Press.
Pearce, J.A., 2018. The Future of Independent Contractors and Their Status as Non-Employees:
Moving on from a Common Law Standard. Hastings Bus. LJ. 14. p.1.
Roberts, J., 2018. Multinational business service firms: development of multinational
organization structures in the UK business service sector. Routledge.
Thirlway, H., 2019. The sources of international law. Oxford University Press.
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