Business Law And Management Help Assignment Sample

Introduction - Business Law And Management Help Assignment 

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TASK 1- Nature of the Legal System

As asked by the firm, the following is the presented report for the new start-up companies and businesses to enhance their knowledge on the laws and legislation they are required to abide by while operating in the United Kingdom. 

1. The most important aspect to focus on by the companies that are starting their functions and operations in the United Kingdom is that what are the laws and legislations to which they shall be subjected to as the ignorance of these laws and legislation may penalise them in terms of monetary penalty. But before a discussion of these laws and legislations is being given, it is important to know from where these laws have come up that is the sources of these laws in the United Kingdom. In the UK, the major sources of law have been categorised into primary and secondary sources. The primary sources of law include-

• Legislations

• Case law or the common law

Legislations are the enacted statutes by the UK parliamentary body consisting of two houses that is House of Commons and the House of Lords also called the lower and the upper houses respectively. These laws are the codified laws as statutes that provide for the definition as well as the punishment of any offence done (Mallor and Barnes, 2020).

Common law or case law is the judge-made law that is whenever there is any ambiguousness or vagueness in the statute, the judges and the judicial body render judgment as per the principles of justice, equity and good conscience. Hence, these judgements serve as judicial precedents for the lower and subordinate courts and these courts are bound by the judgments of the upper court. Further, the lower and subordinate courts are required to deliver the same judgment under the judicial precedent if they face any case concerning the same circumstance and material facts. 

Apart from these primary laws, there are secondary laws as well that form the source of corporate law in the United Kingdom. These secondary laws include commentaries and reports of judicial experts. It also includes the law reports of the government bodies and comments of the judges in particular cases.

2. The next point of discussion for the start-up companies is how these laws under the legislation are being drafted by the Parliament in the United Kingdom. The role of the government body and legislature in the law-making process is the most important contribution as the legislature is the law-making body in the United Kingdom. The Parliament of the UK has two houses that are House of Commons and the House of Lords as mentioned above. The House of Commons is the lower house where the bill is initiated and the House of Lords is the upper house where the bill is finalised. The law-making process in the Parliament is done under sessions called the first meeting or the first stage, the second stage, the third stage and the royal assent. Under each of these stages, the bill is reviewed by the House of Lords and required amendments are being done. Once the bill is finalised, it receives royal assent and is enforced as an Act (De Luca, 2021).

Under the first stage, the bill is being introduced in the lower house that is House of Commons where it is drafted and introduced. The bill is then reviewed by the committee that is called the committee stage. The committee reviews the bills and looks for any required amendment. If there is any amendment in the bill the committee sends the bill back to the House of Commons for modification. If there is no amendment required, the bill is being voted by the members of the house and is sent to the upper house that is the House of Lords. The House of Lords review the bill and initiate modifications if required and if no modification is required, the process of voting is done and the bill is sent for royal consent. 

The courts and the judicial body apply the statutory law prima facie in every case and looks at whether there is any provision in the statute that can be considered while deciding the case. If the statute remains silent or there is ambiguousness and vagueness in the language of the statute, the judicial body looks for the precedents and render the judgment as per the judicial precedent that has been decided before. 

3. Discussing the recent five years reforms in the English legal system, it can be stated that there are two main reforms seen in the English legal system that comprises of the changes due to Brexit and the challenges faced at the time of the covid-19 crisis and pandemic. Due to the lapse of agreement between the United Kingdom and the European Union under Brexit, there has been changes and challenges faced by the country and its legal system. The removal of the United Kingdom from the European Union Brexit has refined the English legal system as the confusions which were seen first have been removed now. This has also made the English legal system more attractive and this has also made the system more flexible and vary cheap (Adams, et. al., 2020). Apart from this, challenges have been faced by the English legal system due to the pandemic in the year 2019. Yet the courts and the legal system has reformed their functioning during the pandemic by adopting the virtual mode for hearing immediate and urgent cases. 

4. It has been further provided that the English legal system has been proved to be an effective system. Yet many criticisms are being given for this legal system. Despite criticisms, the overall effectiveness of the English legal system has been seen to be positive and some of the strengths of this system are as follows:

• The judiciary of the English legal system is an independent one that has given the business confidence in the system and also encouraged international trade and investment. The United Kingdom judiciary is a strong and non-corruptive judicial body that comprises highly experienced legal professionals. Further, this judicial body ensures fair procedures and resolution of the disputes correctly following the right procedure. 

• Common law is based on precedents that have saved the time of the courts in deciding cases especially the ones that have similar or mitigating circumstances.

• Further, the English legal system is not rigid and it is a flexible system that has always kept space for modifications and has adopted changes with the everchanging commercial world (Bayern, et. al., 2017).

• Moreover, the process of arbitration under the English legal system provides for an efficient resolution of business disputes that saves them time and money for the corporations.

• Further, the English legal system has been proved to be the commercial centre for finances and insurance. 

Despite strengths, there are also weaknesses noticed in a critical evaluation of the English legal system. These weaknesses include-

• The English legal system is said to be reactive and not proactive which means the judicial body can only decide the cases that come before it and cannot render judgments on its own accord. The judicial body is only entitled to decide the cases based on facts. If there comes a need to reform, the courts have to wait for the criminal or the civil matter to come before them to change the current precedents. 

• Further, another weakness noticed on critical evaluation of the English legal system is that the Parliament has a primary function of lawmaking that means the framing of legislation is the primary function of the Parliament but this is not the case in the judiciary. The enactment of precedent is not the primary function of the judiciary. The judiciary has the primary function of rendering justice and making the precedent is a secondary function. Hence, this has limited the power of the judicial body that makes the English legal system weak as the independence of the judiciary gets affected due to this weakness (Partington, 2021).

• Apart from this one of the major weaknesses in the English legal system is that the members of Parliament are elected by the people and hence, they are directly accountable to people but the judges are not elected by the people, rather they are elected by the court system which means that the judges are not directly accounted to the people. Due to this, it is believed by the people that the judges sometimes render judgment that is against the community standards which further raise the point that the system under the common law is undemocratic. 

• Further, there is very little space and time for the reviewing of judgments that are given by the courts. The law-making process by the Parliament consists of various stages and processes of investigation and inquiries but the judges are not given sufficient time and resources to review the rendered judgments (Wilson, et. al., 2020).

Despite weaknesses, there has been a stroke of a good balance between the law-making body and the judicial body of the United Kingdom that provides for the provisions to be followed by the operating corporation and businesses. Hence, the new start-up companies and corporations are required to follow these rules and laws to avoid penalties and winding up processes. 

TASK 2- Potential impact of law on business

As asked by the line manager, the presented report is to enhance the knowledge of the clients regarding the impact of commercial and business law on the business operating in the United Kingdom. Discussing the laws that impact the business in the United Kingdom, there are mainly three fields of law that affect the operating business and these three fields are the employment laws, the contract law and the company law.

Commercial law and business law in the United Kingdom comprises the three fields of law as mentioned above. The detailed discussion of these fields of law is as follows:

1. Contract law: The United Kingdom contract law operates in the region to make and enter into contracts by the companies. The companies tend to expand their business and operation by tying up with different companies and entering into contracts with different companies and hence, at such places the English contract law is to be followed so that the contract stands enforceable in the court of law. The English contract law provides for the essentials of a valid contract that is to be fulfilled by the contracting parties while entering into the contract. These essentials are the making of the offer by one party, the acceptance of the offer by the other party, the competencies of parties for entering into the contract, consideration for the contract and the legal object of the contract. In case any of the essentials is not fulfilled by the parties, the contract shall not be enforceable in the court (Arvind, 2017). Hence, contract law affects businesses as the businesses are required to abide by these laws while doing business.

2. Employment law: Apart from contract law, employment law also affects the business operating in the UK as the businesses have to protect the rights and interests of the employees as provided under several employment statutes to avoid legal proceedings. The employment statutes that are required to be followed by the business operating in the UK are the Employment Rights Act 1996, Equality Act 2010, Working Time Regulations 1998, etc. the business has to abide by the provisions of these statutes and protect the rights and interests if their employees. these statutes protect the employees from unfair dismissals, equality at the workplace, cultural diversity and also specifies the working hours for the employees per week. 

3. Company law: Company law is yet another field that affects the business operating in the United Kingdom. This law comprises the statute Companies Act 2006 that provides for the registration of the company and many other provisions that regulate the formation and working of the corporations. The companies operating in the UK are required to register their names under this Act and it also provides for the duties and responsibilities of the directors. Hence, the companies are required to work as per the provisions of the Companies Act 2006 to avoid the winding-up process and going into debt. Further, the Act also specifies the detailed provisions regarding the termination and winding up of companies in case the companies go into debt (MacKenzie, 2020). Thus, the Companies Act 2006 also affects the working of the business in the UK. 

Legislation, regulations and standards

Another aspect of discussion while analysing the working of the corporations in the United Kingdom is the impact of legislation, regulations and standards on the working of the companies. On analysing and discussing the meanings and impact of legislation, regulations and standards, it has been observed that there is a difference between the three fields and its impact on the business also varies depending on the sanction power each of these has. The difference between legislation, regulation and standard and their impact on the business is as follows:

Legislation: Legislations are the enacted statutes and codified laws that provide for the definition as well as the punishment for the wrongdoers. Examples of legislation are the Companies Act 2006, Employment Rights Act 1996, Equality Act 2010, etc. these legislations provide for the rules and provisions that the companies are required to follow in their operations and management. The violations of these rules shall attract penalties and the corporations shall be subjected to fines and court proceedings if they are seen violating any of the provisions of the legislation. The sanction power for the violation of legislative provision is highest as legislations are to follow in the UK for the corporations. For example, the Companies Act 2006 provides for the process of registration of the companies. If the company does not follow the process, it shall not be registered as a corporation under the Act. Further, the Act also provides for the duties of the directors and if any of the company directors are seen to violate the duties, he shall be subjected to penalties. Moreover, the Act also prohibits the use of certain words as the name of the company and if any of the companies are seen to use such words as their names, the registration of the company shall not be completed until such words are removed (Duminica, 2020).

Regulations: Regulations are the enacted and written rules that comprise the process to be followed during the operations. These rules also have equal sanction power as the legislations as the violation of these regulations may also subject the corporation to penalties. For example, Working Hours Regulations 1998 provides that workers shall not work for more than 48 hours in a week and if any of the corporations make the worker work for more than this, the corporation shall be liable for penalties. 

Standards: Standards are the approved criteria under which the corporations are allowed to work and the corporations are required to abide by the standards and work under it and do not cross the criteria in their working. For example, the environmental standards are the most common standards for corporations to follow and the corporations have to be sustainable in their working. The sustainable working of the corporation is enacted within the internal policies to protect the environment from the effect of operations. 

The analysis of the English legal system and its significance is seen in the formation of international contracts as the contracting parties consider the law of England and Wales that is English law in governing their international contracts. It has also been noted that English law is considered as the governing law across the world even in those nations that do not have any geographical joining with the United Kingdom (Kelly, 2020). The main reason for making English law the governing law is that the English legal system has been developed well, framed well and has a reputed jurisprudence across the globe. The English legal system is an ancient law and hence, it is the most preferred law in the world. Moreover, the judiciary is independent in this system and this has led to the development of the arbitration process and the establishment of tribunals that has lower the burden of the courts. Further, the English legal system dominates various sectors like the sector of an international agreement as mentioned above, the sector of banking and finance, the sector of shipping and maritime, the sector of merging of companies and acquisitions and the sector of an alternate mode of dispute resolution that is ADR. 

TASK 3- Formation of different types of business organisation

As asked by the line manager, the presented report provides for the detailed discussion regarding the formation of different organisations as asked by Mr Mc Jones, the client. For the expansion of his car business, there are many options that he could consider for his establishment in the UK. 

For the formation of different types of organisations, it is important first to consider what is the meaning of these organisations and what process is to be followed for the legal enactment of these organisations. As per the literal meaning, an organisation is a group of persons who are working together in an organised manner and sharing the purpose for which it is formed. Hence, an organisation is said to be a group of people who are working for the same purpose and in the interest of the organisation rather than their interest. 

Discussing the formation of different organisations in the UK, it can be stated that mainly three different types of organisations are found in operation which is a sole trading company, partnership firm and limited liability company.

Sole trading company: A sole trading company is formed as per the provided procedure by the government of the United Kingdom. To establish a sole trading company, the person has to inform the tax authority of the UK that is Her Majesty’s Revenue and Customs that the person is paying tax through self-assessment. The individual shall be required to show that he has filed a tax return every year (Set up as a sole trader, 2021). Further, establishing a sole trading company in the United Kingdom, Mr Mc Jones shall have certain responsibilities to fulfil that include the keeping of records regarding the profits and expenses, file a tax return every year and also applying for a National Insurance Number if he wishes to move to the United Kingdom for the expansion of his car business. 

Further, on forming a sole trading company, he shall be the sole owner of the company and he can employ another person as his employees on salary as per their qualification and skills. A sole trading company is owned by one individual and he is solely liable for the actions that the company make and the business the company does. Hence, this is one of the options for Mr Mc Jones for the expansion of his car dealership business. 

Partnership firm: A partnership firm in the United Kingdom is formed by filing the relevant documents and register with the HMRC department of the United Kingdom. To form the partnership firm, the partners are required to register their names with the department and also choose a name for the firm in which they shall operate. All the partners shall be made equally liable for the losses and debts of the firm and all the partners shall be required to get themselves register as partners in the firm with the department. For the governance of the partnership firm, the provisions of the Partnership Act 1890 are applied in the United Kingdom. The liability of the partners in the firm is unlimited but there can also be a limited liability partnership if the partners have mutually agreed for the same at the time of making the firm (Set up a business partnership, 2021).

Hence, Mr Mc Jones shall be required to nominate a partner for his car dealership business in the United Kingdom and register his firm in the name of all partners with the HMRC department. The formation of a partnership firm in the UK is easy and simple and does not require a long documentation process. Hence, this is another option available for Mr Mc Jones to establish his car dealership business in the UK.

Limited liability company: A limited liability company is formed and registered under the Companies Act 2006 of the United Kingdom. The Companies Act 2006 provides for the detailed procedure for the formation of the company in the UK. The limited liability companies in the UK are limited by shares or limited by guarantee. The companies that are limited by shares is formed to make a profit and the ones limited by guarantee is for the non-profit purpose (Set up a private limited company, 2021). A limited liability company makes the members liable only to the extent they have made the investment and hence, their liabilities are limited. Further, a limited liability company is separate from its members which means that the life of the company does not depend on the life of the members and a company is a separate legal entity. Further, a limited liability company has perpetual succession which means that the life of the company shall not come to an end with the end of the life of the members. The limited liability also has a common seal that is to be used as a signature of the company (Directors' duties, 2020).

Hence, the benefits of a limited liability company are more as compared to other business structures and types of organisations. Hence, Mr Mc Jones has another option of proceeding with the formation of a limited liability company for his car dealership business. The following is the procedure for the formation of a limited liability company in the UK:

Step 1: Mr Mc Jones shall be required to choose a name for his company.

Step 2: In the next step, Mr Jones shall be required to choose the directors of the company and also a company secretary.

Step 3: In this step, Mr Jones shall decide who shall be the shareholders of the company and who shall be the guarantors of the company.

Step 4: Mr Jones shall identify the people who shall have significant control over the company business. 

Step 5: In this step, there shall be documentation and preparation by Mr Jones deciding how he shall run his car dealership business.

Step 6: In this step, Mr Jones shall be required to keep the records of his business.

Step 7: Finally, the process of registration of the company shall be done (Gov.uk. 2021).

Hence, these are the available options for the setting and establishing of the car dealership by Mr Jones in the United Kingdom. On analysing all the available options, it is recommended for Mr Jones that he proceed with the establishment of a limited liability company for the expansion of his car dealership business. 

Management and funding of the business organisation

As Mr Jones is willing to establish his car dealership business in the United Kingdom, he shall be in the need of funds for raising capital for his business. If he proceeds with the establishment of a limited liability company, he shall need funds for this business. Hence, there are certain options available for this and also, he shall be needing a management team for the management of his business. 

The options available for raising funds for his business is as follows:

Crowdfunding: This is one of the most used tactics for raising the funds for business. Raising funds through crowdfunding makes the company get funds from a large public using social media or other sources. This helps in raising funds easily and it also attracts new investors. 

Business loans from banks: This is also an option with Mr Jones where he could get funds for his business. He could compare the interest rates of various banks in the United Kingdom and the ones offering the best deal could be contacted. 

Raising funds through shares: Mr Jones can offer shares of his existing company to the shareholders and raise funds. This method shall also help to approach a large number of people to invest in the business.

To manage the business, Mr Jones shall be required to set up a management team with several managers for different fields and skilled employees for the working of the company. The management team shall look after the daily operations and tasks of the company which shall further enhance the efficiency of the working of the company. 

Advantages and disadvantages of various organisations

As discussed above, there are three options available to Mr Jones for expanding his business in the United Kingdom and these options are a sole trading company, partnership firm and limited liability company. 

The following table compares the advantages and disadvantages of the three business structures: