Business

 Law  
Submission  Date:  -­‐  03rd  March  2011  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Rohit  Joshi  
Student  ID:  -­‐  13898  
 
  

Table  of  Contents  

Introduction........................................................................................................... 3  
Sources  of  Law....................................................................................................... 3  
Common  Law........................................................................................................................................................3  
Statute  Law............................................................................................................................................................4  
Equity  Law.............................................................................................................................................................4  
European  Union  Law.........................................................................................................................................5  
Bibliography .......................................................................................................... 6  
 

 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business  Law  -­‐  13898   2  

 
Introduction  
The  history  of  English  Law  can  be  traced  back  to  the  Norman  Conquest  period  in  
1066,  where  William  the  Conqueror  set  up  his  own  court.  The  judges  were  
responsible  touring  around  Britain  and  settling  disputes.  Around  1160  in  times  
of  King  Henry  II,  the  king  decided  to  divide  the  country  into  circuits  and  these  
tours  became  more  regular  and  additional  laws  were  made.  The  judges  took  
their  experience  and  when  returned  to  London  all  the  ideas  were  discussed  to  
help  solve  present  and  future  cases  relating  to  the  people.  The  phase  of  Common  
Law  came  from  there.  Britain  still  follows  Common  Law;  though  various  laws  
have  been  added  and  edited  over  time  according  to  cases  and  situations.  

Sources  of  Law  

The  four  main  sources  of  law  are  Common,  Statute,  Equity  and  European  Law.  

Common  Law  
Also  know  as  Judicial  Precedent  is  extremely  important  in  our  system  and  it  
refers  to  law  that  judges  make  or  amend  through  decision  in  past  verdicts.  
Common  law  has  a  “Stare  Decisis”  principle  that  means  like  cases  should  be  
treated  alike.  All  lower  courts  in  hierarchy  are  bound  to  follow  higher  courts  
decisions  that  are  based  on  previous  verdicts.  If  there  have  been  no  previous  
decisions  made  on  a  point  of  law  than  the  judge  will  come  to  a  decision  with  
reference  to  similar  ones.    

For  example,  Donoghue  V  Stevenson  (1932),  the  claimant-­‐suffered  food  

poisoning  when  he  drank  ginger  beer,  which  was  contaminated  with  dead  snail.    
The  Court  held  manufacturer  for  owing  a  duty  of  care  and  safety  of  products  to  
the  consumer.  

In  some  scenarios  like,  to  avoid  following  the  same  pattern  of  previous  decision  
judges  can  use  distinguishing  as  a  tool  as  it  helps  keep  common  lax  flexible.  After  
considering  the  facts  of  the  case  the  judge  can  distinguish  it  from  previous  cases  
and  refuse  the  earlier  decision.  For  example  Airedale  NHS  Trust  v  Bland,  NHS  
had  asked  Court  to  decide  if  treatment  of  patient  could  be  withdrawn,  as  there  
was  no  scope  of  life,  and  thus  let  the  patient  be  allowed  to  die  peacefully.  
Common  law  creates  a  certainty  in  law  as  the  decisions  are  fairly  and  likewise  
treated  in  the  interest  of  justice  and  solicitors  are  able  to  advise  their  clients  on  
the  outcome  of  case.  As  most  of  the  cases  do  have  an  existing  solution,  it  helps  
develop  the  law  society  and  save  time  of  Court  and  the  people.  Most  of  the  
business  practices  are  based  upon  contracts  and  many  decisions  have  influenced  
the  development  in  UK.  For  example,  RBS  v  Etridge  –  created  the  Etridge  rule;  
the  procedure  lender  must  go  before  he  lends  money  to  joint  tenant  of  a  house.  
Though,  considering  all  the  above  factors,  the  system  is  too  rigid  and  it  neither  
helps  in  enhancing  existing  laws  not  developing  new  one.  The  strict  rules  can  
also  affect  business  harshly  as  old  existing  cases  are  favoured  over  and  linked  
than  considering  individual  scenarios.  This  in  turn  creates  confusion,  as  there  
could  be  hundreds  of  similar  case  without  any  relevant  outcome  to  be  followed.  
Business  Law  -­‐  13898   3  

 
If  by  any  case  the  law  is  considered  for  changing,  than  the  procedure  is  painfully  
long.  

Statute  Law  
Statute  Law  is  a  group  of  laws  that  have  been  passed  by  government  to  deal  with  
certain  specific  situations  or  problems.  The  legislation  has  the  authority  to  make  
a  law  that  they  believe  is  good  to  tackle  certain  situations.  The  procedure  for  
making  a  statute  law  is  by  passing  a  bill  in  House  of  Parliament  and  the  bill  is  
decided  by  votes.  If  appropriate  votes  are  received  it  becomes  a  law.  

Statue  Laws  have  a  major  impact  on  they  way  businesses  in  UK  operate,  as  they  
are  various  laws  in  practice,  which  eventually  affects  them.  These  include;  
Employment  laws,  Tax  laws,  Business  formation  laws,  Environmental  Laws,  
Consumer  Protection  Laws  etc.  Few  of  the  laws  that  have  been  passed  on  have  
affected  many  businesses  like  the  following  ones:  -­‐  
• Companies  Act,  which  was  passed  in  2006  especially  for  small-­‐scaled  
business  to  simplify  their  practice  by  not  having  secretary  and  Annual  
General  Meeting.  But  this  act  has  over  1,200  sections  in  it  and  thus  
making  it  more  complicated  than  trying  to  simplify  it.  

• Equality  Act,  which  was  passed  in  recently  in  2010,  grants  all  pregnant  
women  who  have  worked  for  more  than  26weeks  in  companies  right  to  
maternity  leave  of  12months.  If  the  employer  attempts  to  get  rid  of  the  
employee  he  faces  sexual  discrimination  and  heavy  damages.  

There  are  many  laws  which  the  businesses  have  to  face  such  as  Consumer  laws  
which  deals  with  frauds  or  unfair  business  practice;  Environmental  Laws  which  
relates  to  recycling  laws  and  usage  of  hazardous  chemicals  and  waste  structure;  
Trademark  and  Patent  Laws  that  relates  to  ownership  of  inventions  and  
Intellectual  Property  rights  etc.  These  laws  have  imposed  financial  burden  and  
discourages  many  businesses  being  set-­‐up  in  the  UK.  

Equity  Law  
Equity  Law  supplements  Common  Law  and  deals  with  the  loopholes  left  behind  
from  Common  Law  where  the  dealings  have  been  unfair.  Delays  faced  with  the  
hearings  and  issues  with  damages;  the  Equity  Law  fills  the  gap.    The  following  
remedies  are  available:  -­‐  Specific  Performances  (tasks  that  are  forced  to  carry  
out),  Rescission  (to  restore  position  before  agreement  is  in  place),  Rectification  
(any  changes  to  contract  to  show  true  intention)  and  Injunction  (activity  being  
stopped).  Equity Law will always prevail during conflict between Common Law and
Equity Law.  

However,  in  Seager  v  Copyden  –  Equity  was  used  to  prevent  Copyden  from  using  
the  information  of  an  invention  to  his  own  benefits.  The  information  given  must  
be  respected  and  kept  confidential.    
Equity  is  mainly  concerned  with  maintaining  confidentiality  and  trusts  and  it  still  
remain  important  part  in  UK’s  legal  system.  New  remedies  have  been  introduced  

Business  Law  -­‐  13898   4  

 
but  injunction  remains  the  most  important  and  useful  during  domestic  violence.  
In  2009,  British  Airways  cabin  crew  were  planning  for  the  biggest  domestic  
strike  and  the  court  prevented  trade  unions  to  take  any  actions  and  was  
disputed.  

European  Union  Law  

The  primary  aim  of  creating  this  law  is  the  continuous  integration  of  all  the  
Member  States  economic  and  political  system  so  that  establishments  of  free  
market  are  met.  EU  basically  wants  to  have  a  single  market  where  movement  of  
goods,  people  and  money  and  services  are  readily  available.  To  achieve  this  they  
empower  the  Member  States  to  the  EU  laws  &  treaties  and  also  could  non-­‐
binding  laws  such  as  recommendations  or  opinions.  

The  UK  joined  EU  in  1972,  thus  as  per  EU  law,  if  any  conflict  between  the  laws  
than  the  EU  law  will  prevail  over  the  English  Laws.  There  have  been  many  areas,  
which  have  been  affected  since  joining  the  EU.  For  example  trades  in  Europe,  
employment  and  gender  rights  are  all  affected  by  rules  of  EU.  The  following  are  
the  few  cases  where  businesses  have  been  affected  in  the  UK:  -­‐  

• The  law  enacted  by  European  Court  of  Justice  for  Shipping  Act  1988  
whereby  Non-­‐British  Ships  which  were  banned  from  fishing  in  UK  waters  
was  not  compatible  with  free-­‐trade  which  is  the  main  treaty  of  EU  and  
hence  they  ruled  out  that  has  threatened  livelihood  of  fishing  around  
British  waters.  
• In  MacCarthy’s  v  Smith  in  the  year  of  1980,  The  European  Court  radically  
intervened  an  equal  pay  for  women  and  men  and  there  should  not  be  any  
difference  in  payment  between  genders.  

 
Word  Count  –  1220  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Business  Law  -­‐  13898   5  

 
Bibliography  
Abbott,  Keith.  (2007).  Business  Law.  8th  Edition,  Thompson  Learning.  
 
For  Case  Reference  
British  and  Irish  Legal  Information  Institute.  http://www.bailii.org/.  Accessed  on  
28th  February  2010.  
 

Business  Law  -­‐  13898   6