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Title: Business Law - Legal System Notes
Description: For those of you studying business law for first year university student

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Parliament Sovereignty:
• Makes the parliament the supreme legal authority in the UK, which can create or end
any law
• Parliament cannot bind future parliaments and can repeal/withdraw earlier laws and
laws made by earlier parliaments
• Laws by the parliament dominates all other forms of law
• Courts must apply the laws made by parliament
Rule of Law:
• Legal principle that law should govern a nation, as opposed to being governed by
arbitrary decisions of individual government officials
• Laws must be certain, legible and accessible and should not look for the past
• Requires all citizens – including those in power – to be treated equally before the law
Separation of powers:
• An ideal state should be divided into 3 separate arms: the legislature (parliament),
executive (government and local authorities) and judiciary
...

Action brought
The prosecution – state/
by
generally started by the
police/cps
Action brought
The defendant
against

Civil Law
• To resolve disputes, uphold
rights, provide a remedy
• Gives legal rights to
individuals to govern their
formal and informal
relationships with each other
...


Outcome of trial

Acquitted if not guilty,
convicted if guilty

Decision made
by
Powers of the
Court
Burden and
Standard of
Proof

Name of cases

Most civil cases are heard in the
county court and the High Court and
in certain specialized tribunals
...
g
...
g
...
g
...
k
...
They were owed about
£482 but Rees made an offer to pay £300 take it or leave it
...
But Rees tried to rely on promissory estoppel –
builders have promised to accept less than what they owed so
should go back to the promise – and finally got the full pay as
Rees were taken unfair advantage from the builders
Types of Legislation:
o Legislation made by parliament (STATUTES)
§ Made of two houses: House of Commons (elected house of parliament
or where we vote for every 5 years) and House of Lords – made of
people from different parties (either appointed by past leaders or often
are retired politicians)
§ House of Commons retains the final power
§ Acts of Parliament is the highest form of law à higher than judge
made law / common law)
§ Applies to everybody
§ Are passed for a number of reasons to reform the law, to create new
rights (e
...
human rights act), reform law that has become outdated
(e
...
get rid of death penalty), to put into practice social policies (e
...

equality, race, discrimination etc), to consolidate or codify the law i
...

to put the law in one place

§



Parliament can make and unmake any law that seems fit and can undo
previous parliament’s legislation)
§ Process of an Act of Parliament being made
• Draft stage of an act à known as a bill (somebody come up
with an idea for an act of parliament and it is drafted)
• Most bills are government bills - most of them are by the
government who have more people voting in their favour in the
house of commons and lords while private members’ bill are
harder to be accepted) – which may be precede by a green
paper (this is what we are planning to do, it is a consultation
document so people interested in the government know roughly
what the acts of parliament is before and can contribute it)
and/or a white paper (firm proposals for legislation)
• First process after the bill is submitted going to the house of
commons and it is read out (FIRST READING) and the date is
fixed for the second reading
...
MUST be majority in favour for the bill to
progress to the the next stage
• Committee stage: Members of parliament (MP) debate the bill
in detail (for those who are interested – about 15-20 people –
and sit there for weeks and months going through the bill)
• Report stage: suggestions about amendments to the bill and
reports back to the HC for any changes
• Third Reading: debated again in the HC and MP’s vote à
majority must be in favour
• If all stages are completed à must go through similar stages in
the House of Lords (HL) and debated and voted again
o IF HL make any changes, it has to go back to the HC
for approval because the HC is the elected body in a
democratic society
o If HL didn’t inform the changes, HC can force a bill
through if HL have rejected the bill
§ 2004: Hunting Act (Active Parliament) which
bans hunting for animals with dogs foxes deers
etc, was first introduced in 1997, HC approved
but HL would not approve it, so HC invoke the
parliament act and the bill became law in 2004
...

ECHR was started by European countries after the war as they want to prevent for the
third war from happening by making Europe work closely together
...
g
...
g
...
g
...
g
...
This authority is laid down in an
“ENABLING ACT” which is the act of parliament passed to give others power to
make law on a particular topic (e
...
Transport Act of 1968 gave others powers to
make more detailed laws relating to train transport)
o Referred to as secondary legislation because it is subject to parliamentary
legislation
o MAIN TYPES
§ Orders in Council: made by Privy Council that is a body of high
ranking politicians either when parliament isn’t sitting (parliamentary
years start in the autumn and ends in summer and then parliament has a
bigger break so during that break, orders in council can be passed then
or if there is an emergency and parliament cannot get together quickly
enough)
§ Regulations to implement EU Law: left to member states to bring in
their own legal system

§

Ministerial regulations: ministers will make regulations relating to
their area of responsibility so e
...
the minister of transport would be
the person who make the regulations about the railways //
MINISTERS: the head of the party and can form cabinets (give jobs to
top politicians for different areas à Minister of health/transport/etc)
§ Local authority By- Laws (common type): local councils like Devon
county council and district councils to make laws relating to their
particular area (Devon county council for Devon
o Control is exercised by:
§ consultation with relevant persons or organizations if you are making
law of a particular issue e
...
transport, you would probably consult the
police or motoring organizations if it is the road
§ Publication: all delegated legislation is publicized but people don’t
know where to look for it but it you know it, you can challenge it if
you object it
...
k
...
e
...
That means a lot of delegated legislations becomes law
without parliamentary debate because parliament doesn’t have the time
to debate and it automatically goes as laws after 40 days
...
If somebody exceeds their power, you can challenge them BUT it
is hard to challenge on the grounds of DL because ministers are often
given wide powers to make law (SO it is hard to determine that they
have exceeded their power)
o Advantages of DL
§ By passing power over to others, can save a lot of time to make a lot of
laws needed
§ Expert knowledge

§



Local Knowledge for Local Authorities By-Laws (e
...
Laws for
Devon, so people from London and have never been to Devon before)
§ Bills have to go through in one parliamentary year, there is no such
time constraints for DL so that means its time for consultation
§ Can be passed quickly in terms of emergency
§ Easy to change, if you want to change an act of parliament à you have
to pass an amendments act but you don’t have to do that for DL
o Disadvantages of DL
§ Large quantity of DL passed each year (over 3000 pieces) so its hard to
keep up to date with changes in the law and ignorance of law is no
defence, WHILE Acts of parliament vary from year to year, but on
average there might be 40-50 acts of parliament
§ Some DL is technical or complicated and difficult to understand
§ Some DL is made by unelected officials (in a democratic society,
should law really be made by unelected people)
§ Lack of publicity àSO lack of public awareness about DL which
affects their knowledge and control of it (relying on public to control it
but there is lack of awareness)
§ Difficult to control
European Law
o European Union was formed after WW2 to bring closer union of central
Europe
o Originally 5 members (Belgium, France, Germany, Italy, Luxembourg) à
expanded to 28 members of the EU and the UK joined the EU in 1973 by the
virtue of the act of parliament (The European Communities Act 1972)
...
g
...
Sometimes
judges come across a problem not really knowing how to
interpret the law, so they apply for a ruling from the European
court or ask for advice à ensures the EU law is dealt with in
the same way across the 28 member states
o The effect of EU law on UK Law
§ Doctrine of parliamentary sovereignty à parliamentary was supposed
to be the main law maker in the UK, but once they became the

§
§

§

member, the UK gave up some of their sovereignty to the EU on EU
law matters
...
g
...
g
...

Arbitrator is appointed to hear the arguments of both sides of the disputes and
make a decision
§ Advantage: legally enforceable through the courts à once the
arbitrator has made that decision, you got a legally binding decision
that you can enforced if the other side doesn’t do what the arbitrator
says
§ Arbitration act 1996 regulates arbitration procedures and the role of
the arbitration
§ Common to have arbitration clauses in contracts so that the matter
doesn’t go to the court
§ Some trade associations or agents operate arbitration schemes such as
The Association of British Travel Agents (compensation if the hotels
provided in the tour is different from what they promised for à file for
an arbitration)
o Tribunals:
§ Like specialist courts, more informal than courts, work to resolve
disputes with their panel of normally 3 people and the chair person of
the 3 is normally a legally qualified person and the 2 are normally
specialists in the area of the dispute
...


§

Many types of tribunals: employment tribunals, land tribunals,
immigration tribunals, social security appeals tribunals, mental health
review tribunals
§ Similar with courts in terms of each sides put their arguments but you
can act on your own behalf and you don’t necessarily need a lawyer to
act for you (+)
§ Decision is legally binding (+)
o Advantages of Alternative Dispute Resolution (ADR)
§ Can be quicker in terms of getting into the alternative and time taken
when you are there
§ Cheaper à no court and lawyer fees but might have to pay for an
expert witness and arbitrator will charge you free and often can do it
by yourself so you don’t need a solicitor or a barrister
§ Usually more informal – MEDIATION is the most informal - so less
stressful and adversarial, so can maintain relationships (NOT hostile,
and stressful like in courts)
§ More private – maintains your privacy e
...
for divorce and saves your
business reputation
§ Situated locally and flexible times
§ Usually happier with decisions they have negotiated themselves (for
mediation and conciliation) à more likely to go along what has been
decided
§ Reduces workload for the ordinary courts à leads to long waiting time
§ Arbitrators are experts in the area and tribunals have specialists à
know more about the area compared to lawyers
§ Tribunal and arbitration decisions are legally binding
o Disadvantages:
§ Mediation and conciliation are not legally binding à if agreement is
not reached, a dispute may end up having to go through the civil court
system
§ Awards or compensations may be lower than given by the court
§ Stronger parties can dominate or manipulate the process (e
...
in
mediation and conciliation à stronger party in conciliation is the one
that maybe has legal representation and conciliation often takes place
before an employment tribunal so you might have an employee that is
alleging that they are unfairly treated at work and they wont have a
lawyer but the employer has lawyer à can be dominated by the
stronger party in terms of finance)
§ Decisions aren’t bound by precedent à so they can be a little
unpredictable and inconsistent
§ No legal aid available (legal aid – given if you don’t have enough
money to buy the service of a lawyer, one will be provided for you,
usually for criminal cases only), if you can’t afford it, you don’t get
one
...

§ Judges have come up from the ranks of being solicitors but normally
barristers and then go on to become judges later
o Lawyers in the UK are divided into solicitors and barristers
Solicitors
Barristers
Start by doing a law degree or an
Start by doing a law degree or an
alternative degree and then do 1
alternative degree and then do 1 year
year Common Professional Exam
Common Professional Exam or Post
(squish the law degree into a year
Graduate Diploma in law à
because you didn’t take the law
followed by a 1 year Bar
degree) or Post Graduate Diploma in Professional Training Course, being
law à followed by a 1 year Legal
‘called to bar’ at 1 of the 4 Inns of
Practice Course and a 2 year
Court and 1 year pupillage
training contract
Usually first point of the contract for Are usually instructed by a solicitor
(barristers rarely take legal cases and
someone with a legal problem
sometimes solicitors can deal with
the problem but sometimes needed
when you are in a higher court) and
take cases under the “cab- rank
rule” – barristers take the first case
that they are given if its within their
area of expertise to ensure that
people are charged with unpopular
offenses get barristers to act for them
Perform a variety of work including
giving legal advice on all legal
matters form divorce to torts to
employment etc and sometimes they
do advocacy (putting forward an
argument on somebody’s behalf in a
court or tribunal)
May work in a variety of legal areas
or specialise (depending on where
they work)

Act as expert advocates in all courts
(wearing wigs and gowns), write
opinions on points of law and draft
legal documents
...
g
...

Professional body – The Bar
Council
...
g
...
She topped her glass up with a
refill and the remains of the decomposed snail came into the glass and
she became ill from drinking the contaminated ginger beer
...
She succeeded and got compensation because the
ratio decidendi of the case is that manufacturers owe consumers a duty
of care not to harm consumers with their products and manufacturers
were in breach of that duty so they were liable to pay for
compensation
...
g
...
g
...

• OVERRULED in the Mohamud v Morrison Supermarkets
(2016) à Mr Mohamud was assaulted in a garage forecourt
(kiosk where you pay) and they got into an argument and Mr
Mohamud was hit and this case Morrison, the employer was
held liable because actions are carried out in the course of their
employment
...

§ Distinguished: a judge does not follow a precedent because he or she
considers the material facts of the case being decided are different
from the precedent (the general rule in contract is that between family
members and friends, there is no intention to enter into a legally
binding agreement enforceable through the court when you make an
agreement)
• Balfour v Balfour (1919) à Mr Balfour and Mrs Balfour were
working overseas and Mrs Balfour became ill and had to return
to the UK
...
She argued that they
had a legally binding agreement to give monthly allowance but
he stopped paying, so it was a breach of contract
...




Meritt v Meritt (1971) distinguished from Balfour v Balfour
à Husband and wife were going to divorce and met up to
decided who’s going to get what
...
He said that if she pays the mortgage of the
house (loan they took when they bought the house), he would
transfer the house from his name to her name
...
So she took him to court for breach of
contract, IF the court followed the Balfour v Balfour, she
would get the house
...

Hence, in a business relationship, there is a presumption that
you do intend to enter into a contract when you enter into an
argument
...

§ The Supreme Court (highest court) can invoke the 1966 practice
statement – where the courts issue a statement on their best practice,
and in 1966, they said we will normally follow a precedent because
that keeps the law certain and predictable, but if they feel that it is
right to change the law, we will even though parliament hasn’t
changed the law
• Case: R v R (1991) à a man was convicted of raping his wife
overturning the previous precedence but this was not possible
due to entering into a marriage contract, each person to that
marriage contract consents to having sexual intercourse with
the other
...

o In 1966, the supreme court overturned that practice and
he was found guilty raping his wife
o When there is no precedent or the law isn’t clear, judges do make law;
§ Airedale NHS Trust v Bland (1993) à Tony Bland was a young
supporter of Liverpool F
...
who was caught in the Hillsborough crush
which reduced him to a persistent vegetative state
...

His brainstem was alive, so he was legally alive but he had been like
that for 3 years so he had no hope of recovery
...
Switching off the machine would be lawful and they
received that declaration
...
Where a person is unable
to give or withhold their own consent, doctors are entitled to decide
what is in that patient’s best interest – best interest of the patient is to
discontinue treatment as there is no prospect of the treatment
improving his condition
§ Re A (conjoined twins) – 2000: Mary and Jodie were conjoined twins
joined at the pelvis
...
However, Mary was weaker, she was described








as having a primitive brain and was completely dependent on Jodie for
her survival
...
So the hospital sort a
declaration that this operation could go ahead, but the law wasn’t clear
so they made sure they wouldn’t be charged with murder because one
of the twins was going to die
...
Mary’s death would
be seen as an invecitable consequence of an operation which is
intended and necessary to save Jodie’s life
...
g
...
g
...

o Number of factors may cause uncertainty despite efforts to draft legislation
carefully, e
...
broad terms and/or ambiguous language, future possibilities
may not have been foreseen when the bill was drafted, misinterpretations may
have been overlooked
o Judges have developed certain approaches to the task of interpreting statutes
called, “Rules of Interpretation” although they are not rules in the accepted
sense and judges choose which approach to adopt
o Judges think that the Parliament should make the law, judges are the ones who
are going to interpret it or judges may use their common sense to correct the
error from the laws made by the parliament years before or be more creative
by ‘filling in the gaps’



4 main rules of statutory interpretation
o The Literal Rule: most restrictive and should be the starting point where you
have to follow the letterà should follow the words given in the dictionary,
ordinary, everyday meaning // even if the result appears to be contract to the
intention of parliament or leads to injustice à up to the judges to interpret it
§ Fisher v bell (1961): 1959 – The defendant had a flick knife displayed
in his shop window with a price tag on it
...
His conviction was quashed
as goods on display in shops are not 'offers' in the technical sense but
an invitation to treat by displaying goods in the shop window so he
had not broken the law
...

§ Advantages: judges cannot use their own opinions or moral views to
the case, Upholds the doctrines of separation of powers (executives,
government and judiciary) – each do their own thing - and
parliamentary sovereignty
§ Disadvantages: you don’t get the justice, restricts the role of the judge
too much (if they feel like having to follow the literal rule, they cant
use their common sense even when they are experts in law), can create
loopholes in the law (e
...
Fisher v Bell), can create awkward
precedents which require parliamentary time to correct (e
...
Fisher v
Bell), fails to recognise the complexities and limitations of English
language, poor decisions can undermines public confidence in the law
(you think you don’t get the justice that you think it is)
o The Golden Rule: words should be given their literal meaning unless this
leads to an absurd result or repugnant situation, then judges may modify the
words according their common sense to get a more acceptable decision
§ E
...
R v Allen (1872) 1866 – The defendant was charged with the
offence of bigamy
...
Under a literal interpretation of
this section the offence would be impossible to commit since civil law
will not recognize a second marriage any attempt to marry in such
circumstances would not be recognized as a valid marriage unless they
are divorced or one died à The court applied the golden rule and
interpreted the words instead of married: going through the marriage
ceremony so he was found guilty of bigamy
§ E
...
Re Sigworth (1935): A son murdered his mother to inherit her
wealth
...
Under the statute setting the law on
intestacy he was her sole issue and stood to inherit her entire estate
...
So the court interpreted
the act as he wasn’t there so he was thus entitled to nothing
...
g
...

o The Purposive Approach
§ Has a wider application, judges look at the spirit or purpose of the law
and interpret the words to achieve this
• The Royal College of Nursing v DHSS (1981) Abortion Act
(1967) – termination of unwanted pregnancies can only be
carried out by registered medical practitioners i
...
doctors or
surgeons
...
The court held
that it was legal for nurses to carry out such abortions because
one of the Abortion Acts states that women could have saved
termination of unwanted pregnancies and if nurses could do
that, they were fulfilling the act (aims to get rid of backstreet
abortionists) so they were not breaking the law
§ The Advantages of Mischief rule and purposive approach:
• Cases can be decided in line with parliament’s intention
according what the parliament was trying to say – e
...
abortion
• Allows loopholes to be closed à what the parliament was
trying to say about prostitutions in the street
• Allows the law to develop and adapt to changing needs of the
society (e
...
Abortion act)
§ Disadvantages:
• Allows judges to bring their opinions to the case (applies for all
except LITERAL RULE)
• Changes the law à can create an offence afterwards
• Gives judges law making role
• MOST CREATIVE BUT CAN LEAD TO UNCERTAINTY
§ EU Law requires a purposive approach to interpretation (because it is
drafted in general terms)
§ Judges should take into account Human Rights Act when making
decision
Other aids to Interpretation

o Dictionaries and textbooks à looking at the reports about law and Hansard
(official reports of the parliamentary debates)
o The presumptions of legislative intent
§ If you presume something that is assumptions that are made, if an
active parliament doesn’t say to the country, judges can make certain
presumptions about the act, judges going assume that the criminal is
guilty is that they have a guilty mind (mens rea)
§ If something is made in an offense, it should only be applied to the
future and not past (laws should not operate retrospectively)
§ If there is any doubt, the defendant should be found not guilty (laws
that are ambiguous should be interpreted in favour of the defendant)
o Internal aids found within the statute itself, such as: titles, headings, the
statute’s interpretation section, explanatory notes
o Rules of Language
§ The same type/ ejuidem generis rule: the general words will only apply
to things of the same type as the specific words, e
...
they are saying
specific things then say the general oneà should be related to the
specific words (only applies to lions, tigers, and other animals à
leopards but not cows)
§ To express one excludes the other/expression unius est exclusio
alterius à applies to “lions” would only apply to lions and not tigers
or other animals
§ A word is known by the company it keeps / Noscitur a sociis à dog
baskets, dog collars, and food à FOOD would mean DOG FOOD


Title: Business Law - Legal System Notes
Description: For those of you studying business law for first year university student