In This Post, We’re Going To Discuss Some Of The Very Interesting Topics – What Is Business Law, Types Of Business Law, Common law and equity, Private law and public law, Criminal law and civil law, etc. Just See The Answer In The Below Section.
Topic From – Business Law / LLB
Topic – ‘The English Legal System”
From Book – ACCA Corporate And Business Law (2011)
Also, Check – BBA Semester 3 (Case Study Assignments)
What Is Business Law?
Human society has developed over thousands of years from a primitive culture where the very survival of
the species was at stake to the complex, diverse and dominating species that humans are today.
Much of the success of this development can be attributable to rules and regulations laid down by society. With a little further study, the need for such rules becomes clear. In the early days of human existence, survival was achieved by working as a group. There was a fine line between life and death, for example, the stealing of food from some other group member could eventually result in the death of the victim.
Social order, created by rules is at the foundation of the society that we see today. The framework that was created influences how individuals interact and how businesses operate. In other words, it provides social control.
The framework of social control can be viewed as having two aspects:
• Formal control mechanisms
• Informal control mechanisms
Law is a formal control mechanism. It provides a structure for dealing with and resolving disputes that may arise, as well as providing some deterrent to those wishing to disrupt social order.
Informal mechanisms include ethical and moral guidance. These are ‘norms’ or behavioral expectations that society has developed over time through its culture. Such mechanisms have little formal structure to organize, control, or to punish – such matters are dealt with informally by pressure from other individuals or groups.
PER 2 requires you to ensure compliance with legal, regulatory and social requirements in your area of responsibility. The contents of this Study Text should help you identify common legal and regulatory requirements.
State Types Of Business Law ‘s:
• Common law and equity
• Statute law
• Private law and public law
• Criminal law and civil law
2.1 Common law and equity
The earliest element of the English legal system is common law, a system of rigid rules laid down by royal courts following the Norman conquest. The application of the law was by judges who traveled around the country to keep the King’s peace and judgments often resulted in harsh consequences.
The judges actually made the law by amalgamating local customary laws into one ‘law of the land’.
Remedies under common law are monetary and are known as damages.
However, there are times when money is not a suitable remedy. For example, you have agreed to buy a unique painting from an art dealer. Should the dealer at the last minute sell the painting to someone else, damages are unlikely to be acceptable, after all, you wanted that painting.
Equity was developed two or three hundred years after common law as a system to resolve disputes where damages are not a suitable remedy and to introduce fairness into the legal system.
2.2 Statute law
Whilst the judiciary is responsible for the creation of common law, Parliament is responsible for statute law. Statute law is usually made in areas so complicated or unique that suitable common law alternatives are unlikely, or would take an unacceptable length of time, to develop – company law is one example of this.
2.3 Private law and public law
Most of the law that you will be studying is private law. That is a law that deals with relationships and interactions between businesses, and private individuals, groups, or organizations.
The state provides a framework for dealing with disputes and for enforcing decisions, but it is for individuals to handle matters between themselves. For example, the Sale of Goods Act 1979 regulates the sale of goods. It provides rules that must be adhered to when making a sale. Should any dispute arise that is covered by the act, it is up to the parties to resolve the matter themselves using rules laid down by the legislation, the state does not get involved.
Public law is mainly concerned with the government and the operation and functions of public organizations such as councils and local authorities. It will not be of great interest to you in your studies of corporate law, however, examples of public law can be found in planning rules that must be adhered to when building or expanding offices.
A key distinction between public and private law is who takes up the case when a wrong is committed.
The state prosecutes the alleged perpetrator under public law, whereas we have already seen, under
private law it is for the individual concerned to take action.
criminal law is a part of public law and deals with behavior that the state considers unwelcome and wishes to prevent. Criminal law also decides how those guilty of committing unlawful behavior should be punished. You will notice the names of criminal cases are reported as R v Jones or Regina v Jones. This
indicates that the state takes action on behalf of the crown.
2.4 Criminal and civil law
It is often the criminal law about which the general public has a clearer perception and keener interest.
Some of the high profile criminal cases at London’s Old Bailey are deemed extremely newsworthy. Civil
law, on the other hand, receives less overt media coverage. However, every time you buy or sell goods, or
start or finish an employment contract, your actions, and those of the other party, are governed by civil
The distinction between criminal and civil liability is central to the English legal system and to the way the
the court system is structured.
2.4.1 Criminal law
In a criminal case, the State is the prosecutor because it is the community as a whole which suffers as a
result of the law being broken. Persons guilty of a crime may be punished by fines payable to the State,
imprisonment, or a community-based punishment.
Generally, the police take the initial decision to prosecute, but this is then reviewed by the Crown
Prosecution Service. Some prosecutions are started by the Director of Public Prosecutions, who is the
head of the Crown Prosecution Service.
In a criminal trial, the burden of proof to convict the accused rests with the prosecution, which must
prove its case beyond a reasonable doubt.
2.4.2 Civil law
Civil law is a form of private law. In civil proceedings, the case must be proved on the balance of
probability. The claimant must convince the court that it is more probable than not that their assertions
There is no concept of punishment, and compensation is paid to the wronged person. Both parties may
choose to settle the dispute out of court should they wish.
Terminology in civil cases is different from that of criminal cases. A claimant sues a defendant. A civil case
would, therefore, be referred to as, for example, Smith v Megacorp plc.
One of the most important areas of civil liability for the business, and accountants, in particular, is the law of contract. The law of contract is looked at in detail in Part B of this text.
2.4.3 Distinction between criminal and civil cases
It is not an act or event which creates the distinction, but the legal consequences. A single event might
give rise to criminal and civil proceedings.
Important Question Related To This Article
Q. While on a sales trip, one of your employees is involved in a car accident. The other vehicle involved is damaged and it is alleged that your employee is to blame. What legal proceedings may arise as a result of this incident?
Answer – Your employee may be guilty of a driving offense such as careless driving. The police, to whom the incident should be reported, will investigate, and if the facts indicate a driving offense, they will prosecute him. The owner of the damaged vehicle (or his insurers) may sue the driver at fault in civil proceedings to recover damages.