UK Business Law: Sources, Creation Process, and Organisation Analysis

This report provides a detailed overview of business law in the UK, covering various sources of law, including legislation, common law, European Union law, and the European Convention of Human Rights. It explains the process of creating statutory and common law, highlighting their purpose in courtrooms with examples. The report also briefly explains company law, employment law, and contract law, emphasizing their significance in the business environment. Furthermore, it discusses the legal formation, management, and funding of different organizations like sole proprietorships, partnerships, and limited liability partnerships. The report concludes with recommended suggestions towards case laws, offering a comprehensive insight into the legal aspects of business operations in the UK. Desklib provides access to this assignment and many other resources for students.

Business Law

Table of Contents
INTRODUCTION...........................................................................................................................3
Task-1..............................................................................................................................................3
P-1. Define several sources of law.........................................................................................3
P-2. Clearly explain process of creating law and define purpose of statutory and common law
in court rooms.........................................................................................................................4
TASK-2............................................................................................................................................5
P-3. Explain company, employment and contract law in brief..............................................5
Task-3..............................................................................................................................................6
P-4. Legal formation of different organisations. ...................................................................6
P-5. Explain managing and funding of different organisations..............................................7
Task-4..............................................................................................................................................8
P-6 Recommended suggestions towards case laws mentioned below...................................8
Conclusion-....................................................................................................................................11
REFERENCES .............................................................................................................................12
.......................................................................................................................................................12

INTRODUCTION
The term business law can be defined as the rules that has to be followed by each and
every business organisation in the country. The business laws are the laws that explains about the
provisions related to business. These rules are mandatory to be followed by all business
enterprises in the country. There are different kinds of business law such as employment law,
equality law, taxation law, import and export law, etc. These laws are applicable on every task
that is being performed in the business organisation(Butturini, 2020). It makes all the legal
provisions to be followed by the business concern. The royal queen annually gives the speech
called speech from throne. This speech is related to the law of the country. This report would
consist about the contract law, employment law, etc. in detail. It also discusses about three case
scenarios related to the business law. This report would also detail about the different sources of
law in UK along with its procedure to make law in the country.
Task-1
P-1. Define several sources of law
Law in UK is classified by geographical divisions but this is governed by four sources of
laws. These sources of law are categorised as follows-
Legislation: This is the power house of making, repeating and cancelling a law in the country.
This means that it has several powers along with multiple workings that would ultimately
cooperate with legal divisions and working process. Its one of supreme bodies in state that would
coordinate with all sections of laws in country. Legislation is classified into two parts that are
delegated legislation and primary legislation. This is a supreme law making authority different
from European union, modified legislation has legal bodies that have authority over parliament
to create laws(V, 2020).
Common Law: This part of law is also very crucial aspect of law devising, principles made in
prior case laws of the courts of the nation. In case, the parliamentary it would create a big view
of perspective. It has been in history before evolution of the judicial system of UK. In kings
rulings, king was the component of highest hierarchy as well as the laws passed by him were the
laws that were followed by overall area ruled by them in the country. Common laws are very
much established law and one of most followed instrument. So, it distinguishes each law to be

specific in its own way and sometimes it has really extraordinary laws that become an act in
legislature.
European union: The European union was created for the usefulness of citizens of UK. The
needs for this union was realised after World War II. In this , the people started to civilise again
but this union was framed to not affect each other in all the ways. This is made up of twenty
eight countries. There is dominance of EU because of this large number of member countries in
the world. This union gives a merit in controlling the marketplace as well as the most developed
states are the part of it, it too gives the global dominance. So, the conception of creating this
Union was to end wars between all states along with promoting the peace in the
country(Imhimmed, 2020).
European convention of human rights : These conventions are made with the sole purpose is
to outspread and support peace in all states of the world. The main need of having this
convention is to make and produce a good living environment for all the persons along with
cultivating the progressive nations of the world. This union mainly takes care of expressing the
human rights laws along with the norms properly within business arrangement and different
divisions also. Along with this, the human rights are the one thing that is so diplomatic and it has
changed with various new amendments to create with the changing needs of the individuals.
P-2. Clearly explain process of creating law and define purpose of statutory and common law in
court rooms.
Statutory law: The statutory laws are those laws that are framed specifically for the
country. These laws are framed by the legislature of the nation. There are various steps that has
to be followed before framing the law for the country. These laws are applicable on all the
individuals of the UK. This is the law which is being provided in the written form. This law is
produced by the parliament of United Kingdom. The main principle which works on is that its
used by judges, the wordings are used by it and its workings in the court of justice. Since, it
would not be justified for a gainful outcome so it is generally used in its simplest
form(Sachindrani and Samayawardena, 2018).
Procedure of application in justice court: this procedure can be explained through an old case of
the year 1836 R vs. Harris where the accused has bit the nose of victim. Here, in law it was
specified that “stab, wound or cut” another person is a crime which does not include biting . On
this basis the defendant was released and no cost were implemented on the accused of the case.

This example tells that the literal meaning of this term in the law can only be used in its actual
meaning. Hence, it cannot be bend or changed for acquiring the desired outcome in the given
case.
Common law: This is the most simplest definition that can be explained as the
judgements which is to be given in court room for some specific decision or cases that would
only be enforced in the given case scenario. It was arise in early middle ages for the kings court
rooms, in which the decisions were to be given by king who has created the law. So, this concept
sometimes has some extraordinary dominion that is to be given by supreme benches which is to
be accepted by the legislation of the country.
Process of application in justice court: By implementing this law, in court rooms in too common
and easy to explain. The same cases happened before which is being used in this case law. It too
provides the favour for the current case. If the case is having similar facts or issue between the
two parties, there are various same case laws by which one can mention and gain merits in their
case law by acquiring the desired results as case decisions(Hamed, et.al, 2022).
TASK-2
P-3. Explain company, employment and contract law in brief.
Company law: It was established in year 2006 as the name of the Company Act, 2006. The
main purpose of this act is to accumulate all the facts and figures of a business arrangement. This
would later on create them properly in the law system. It would make them legally eligible for
their acts. This act too covers mostly all regions of activities that is being recorded in any
business arrangement, later it has explained the methods and remedies for any dispute arises
while on the job. It maintains a set of laws that is comprehensive in nature in UK. This would
also change almost each working process of law in concern with business concern.
Employment law: The employment law would explain about the conditions of the working in an
business arrangement. It is the relationship between workers and employers that governs
evaluation of both parties from each other. This is the contractual contract In this contractual
concord form, all the members or employees are mandate by a basic system of terms and
conditions that has to be followed by them in the organisation. If any person fails to do so, then
penalties are applied on him. It too protects concern and employees from receiving any unfair
treatment on any of the basis.

Contract law: This is the relationship between parties that is bind able on both parties of the
contract. The English Contract law explains about the four main essential conditions of the
contract. These are the offer and acceptance, consideration, intention to create legal relations
between the parties to the contract. The contract makes the parties to agree on the given terms
voluntarily. It regulates the exchange of goods and services between the parties of the contract as
per the terms and conditions of contract(Bin, 2022).
Task-3
P-4. Legal formation of different organisations.
Sole proprietorship- it is that type of business in which there is a sole trader who runs and owns
the company on its own. There is no third party with whom the rights of the company is shared
by the sole proprietor. The individual holds the whole and sole responsibility of the business.
There could be no differentiation drawn between the company and the owner. The owner can
hire any individual to share the burden of the work but cannot make that person a partner or the
ownership rights of the company. For the formation of a sole proprietorship no rules and
regulations are required to be followed as there is no legislation provided for the same.
Registration is not compulsory for this type of business. But if a person who is working in a
capacity of a sole proprietor wants to register the company can do so by reaching with the
documents to the local office of registration(Irani and Karnik, 2022).
Partnership- as the name suggests itself, two or more persons who agreed to carry on the
business with each other can enter into a partnership agreement. They will share the profits and
are equally liable for any loss. They posses same amount of duties and answer ability. The
partnership is followed by a contractual agreement which takes place between the parties. All
sort of terms and conditions, profit and loss share, obligations are mentioned in this contract. The
parties who agree on that agreement mutually for attaining any financial gain. There are certain
mandatory steps that are required to be followed by the parties-
 The contact must hold legal position in the eyes of law.
 Making registration of the firm in the local registration office.
 Starting the partnership by setting up the stakeholders.
Limited liability partnership- the liability of the partners under this form of partnership is
limited to an extent. This type of firm is also established by entering into a partnership agreement

by the parties by giving their mutual consent on the terms and conditions of the contact(Ireland,
2018). But one of the biggest difference between partnership and limited liability partnership is
that the partners are not liable to pay the debts to the creditors. The company holds its own legal
identity and that is why it is liable for paying the debts of the company. The partners are not
made personally liable to pay any kind of liabilities in terms of any loan, debt. At the time of
winding up the personal assets of members of the partnership firm are not being used to settle
any loss or debts(Yurkevych, et.al, 2018). The legal process to form a limited liability
partnership are as follows-
 Registration with the company house.
 Employing a secretary and providing names of the directors.
 Enlisting the shares among the public.
 Recruiting workforce and planning for setting the policies of the company.
 Deciding the equal share of profits and liabilities.
P-5. Explain managing and funding of different organisations.
Basis of: Sole proprietorship Partnership LLP
Management Sole proprietorship is
easy to start and
manageable from the
other forms of business.
A single person can start
the business as a sole
trader without
performing any kind of
formalities(Kasych, et.al,
2019). But with this, the
sole trader is himself
accountable to run the
company by fulfilling all
the necessary obligations.
It is not that easy to
manage partnership
firm. All the partners
are equally liable for
the profits as well as
the losses. It is required
to get registered with
the local registry office
by following a lot of
documentation. The
liabilities are on the
head of each and every
member who is a
partner of that
One benefit that lies in
LLP is that the partners
holds liability to an
extent. As the company
in this type of business
holds a distinct legal
identity than that of its
members. That is why
it is liable for all the
debts. At the time of
winding up of a
company, partners are
not personally liable to
pay the loans or debt to

The individual posses the
decision making power.
Third party interference
is not allowed in this
form of business.
firm(Haveman and
Nedzhvetskaya, 2022).
the creditors.
Funding  Savings
 Loan from the
banks.
 Personal loans.
 Borrowing
money from other
financial
agencies.
 Investments
made by the
partners.
 Personal loans
 Share capital of
the company.
 Bank loans
 selling the
shares in the
share market.
Task-4
P-6 Recommended suggestions towards case laws mentioned below.
In case of any conflict arise between the parties, they can approach to the court of law in order to
solve the matter in issue. But this process sometimes consumes a lot of time and money. That is
why the government of United Kingdom has taken an initiative which is known as alternate
dispute resolution in which the parties can opt for out of court settlement(Franjić, 2021). It is
more efficient in terms of saving money, energy and time. It is formulated under the Civil
Procedure Rules 1986. it provides speedy solution to the disputed matters. Various case studies
including alternate dispute resolution in order to dispose off the case are given below-
Case 1
Scenario: Gordon is employed as a sales person in the company Orange Computers Ltd.
According to the contract that he entered while being employed states that the salary which he
will get for the position would be 10000 pounds along with the commission of 9 percent on the
annual sales. In the year 2015, the company has undergone with some losses and for the same
Fred asked Gordon that it would be helpful for the business if he waive the salary for 2015-17 by
accepting the commission. New terms have been added into the contract with the consent of
Gordon and Fred. But, in the year 2016, the money supply in the market started increasing and

with that the company is also earning profits. With this, Gordon wants his salary which he had
forgone at the time business got affected with the adverse changes in economy.
Legal point: the legal point established in the above case scenario is that whether Gordon can
claim the wages for the year 2015-2017 or not?
Legal solution: for this matter, negotiation is the legal solution that is being suggested.
According to this, a negotiator would be appointed to provide a suitable way to settle the conflict
between the parties. The primary objective of the third party who is acting in the capacity of a
negotiator is to reach to a win win situation for the benefit of both the disputed parties. Until and
unless the agreement is signed by the parties, the decision of the negotiator will not be binding
upon them.
Legal justification: in order to get speedy solution to the case, negotiation is recommended to
the parties. It is cost effective as well as saves time. It also helps the parties to find a win win
solution so that the interests of both the parties could be saved from any sort of harm.
Effectiveness of legal solution: by approaching to this method, Gordon and the company can
reach to a conclusion that is favourable for both the parties. They can discuss over the
distribution of the wages of the past years. It can be noted from the facts of the case that the
alteration in the employment contract is done with the consent of both the parties. Hence,
negotiation would be best suited for reaching to a solution.
Case 2
Scenario: Janet wants the internet package and for the installation of the same, she called Virgin
media. She bought the package with cost of 35 pounds per month. It also contains telephone
services of the whole month on 11 pounds as rent. The company send its installation engineer on
the next of the request placed by Janet. The internet lines were installed but the point where the
telephone is required to installed could not be found by the person. He stated that first it is
needed to inform the installation technician regarding this problem and will report after having a
discussion(Corsi, Feranita and Massis, 2022). Days passed but there is no response came from
the side of the engineer. Then Janet make a complaint in the respective company. After the
period of 3 processing weeks, the phone line was installed. But Janet received a bill for the
whole month particularly of the telephone services.
Legal point: whether Janet is liable to pay the bill of the whole month as she did not make use of
the telephone services at all?

Legal solution: mediation would be best suitable solution for this case in which a mediator is
appointed to solve the matter. The mediator is a person who is unknown for both the parties
which helps in making an impartial decision. The decision of the mediator do not holds any
binding force.
Legal justification: this particular method is benefiacial for the concerned company because it
does not affect the brnad image of the business. It will also provide quick solution to the case.
Secrecy will also be maintained regarding the case.
Effectiveness of legal solution: the company that is Virgin Media has performed breach on its
part by not providing appropriate installation of the telephone lines and above all this, it has
charged the customer with the bill of the entire month. Mediation will help to solve the case with
confidentiality by reaching to a suitable conclusion without harming the goodwill of the
company(Hardman, 2022).
Case3
Scenario:
The company Black Horse Ltd. is a security firm which has 50 staff members. The four biggest
customers are in absence on its payments. They have left it with a bad debt of almost £100000.
The institution was not able to pay its debts, as well as one creditor filed a request to wind up the
concern. The court must now adjudicate whether or not to issue a close up order.
Legal Point:
The legal issue is that whether the creditors have the right to petition for winding up of Black
Horse Company as the last choice. And perhaps establishing the bankruptcy is the last choice left
for creditors?
Legal solution:
Arbitration is recommended as a legal correction in this situation. It estates selecting an impartial
mediator who, after hearing the applicable facts and documentary grounds, will provide a
determination that is legally constricting on the parties. The main advantage of this is that the
organization can choose the arbitrator, the location of arbitration, and time of arbitration. The
client has the choice to take conciliation. It too entails by selecting a neutral third organisation to
mediate differences who will review all applicable information and make a settlement opinion.
Once the parties sign the settlement contract which is legally binding.

Legal justification: This course of action is considered so that the parties can set their conflict
friendly. Since arbitration has the similar legal standing and legal force which has a court, it can
help parties that would resolve differences quickly and obtain a legally applicable ruling.
Conclusion-
The conclusion drawn from the above report is that it is important to understand business law
and its dissensions in a proper manner. Suitable remedies must be provided for settling down the
disputes between the conflicting parties. The case laws that are mentioned in the report will
render a definite and concise solutions regarding various issues that arise in the business
corporations. In order to make a strong base of rules and regulations in the business
organizations, appropriate legislations are required to be enacted by the government of the
country. It also explains different types of businesses that are present in the country along with
the legal process that is needed for the formation of such businesses.

REFERENCES
Books and Journals
Butturini, P., 2020. Written Resolutions in UK Companies Act 2006 and Their Possible
Relevance beyond UK Borders. European Company and Financial Law Review, 17(6),
pp.760-784.
V., Gayathri, 2020. Comparison of UK Companies Act 2006 and Indian Companies Act
2013. Issue 3 Int'l JL Mgmt. & Human., 3, p.632.
Imhimmed, A., 2020. To What Extent Does Legal Capital Requirement Provide a Sufficient
Protection to The Creditors: anExamination the Situation in the UK and the EU
Member States.
Sachindrani, D.M. and Samayawardena, D.T., 2018. WINDING UP OF A COMPANY AS A
MODE OF LIQUIDATION: A COMPARATIVE ANALYSIS WITH UK
PERSPECTIVES.
Hamed, R.S., et.al , 2022. The impact of introducing new regulations on the quality of CSR
reporting: Evidence from the UK. Journal of International Accounting, Auditing and
Taxation, 46, p.100444.
Bin Hagshah, A.F., 2022. The new Saudi Corporate Governance Framework: a comparative
legal study with the UK and Delaware (Doctoral dissertation, University of Glasgow).
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Haveman, H.A. and Nedzhvetskaya, N., 2022. Community, enterprise, and self-help: The
coevolution of capitalism and non-profit and for-profit businesses in Britain and
Germany. In The corporation: Rethinking the iconic form of business organization.
Emerald Publishing Limited.
Franjić, S., Business Activities and Trade Law. PaKSoM 2021, p.59.
Corsi, S., Feranita, F. and De Massis, A., 2022. International R&D partnerships: the role of
government funding in reducing transaction costs and opportunistic behavior. R&D
Management, 52(3), pp.530-547.
Hardman, J., 2022. United Kingdom historical viewpoint. In Research Handbook on
Shareholder Inspection Rights: A Comparative Perspective. Edward Elgar.
Ireland, P., 2018. Efficiency or Power-The Riser of the Shareholder-Oriented Joint Stock
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Yurkevych, Y.M.,et.al, 2018. Compulsory termination of legal entities: Civil legal and criminal
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Kasych, A.,et.al, 2019. A world model of social entrepreneurship in a crisis. Journal of
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