Unit 7 Business Law

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Unit 07: Business Law Assignment 01 Mohammed Yusuf MGM
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Unit Title Unit 7: Business Law
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Submission Date
submission
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submission
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LO1 Explain the nature of the legal system

Pass, Merit & Distinction P1 P2 M1 D1
Descripts
LO2 Illustrate the potential impact of the law on a business
Pass, Merit & Distinction P3 M2 D1

Descripts
LO3 Examine the formation of different types of business organisations
Pass, Merit & Distinction P4 P5 M3 D2

Descripts
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Pearson
Higher Nationals in
Business
Unit 07: Business Law
Assignment 01
5
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Higher National Certificate/Diploma in Business
Assignment Brief
Student Name /ID Number
Unit Number and Title Unit 7: Business Law
Academic Year
Unit Tutor
Assignment Title Explain the basic nature of the legal system and Illustrate the
potential impact of the law on a business.
Assess the advantages and disadvantages of the formation of

different types of business organizations.
Issue Date
Submission Date
IV Name & Date
Submission format
SECTION A:
The submission should be in the form of an individual written report. This should be written in a concise, formal
business style using single spacing and font size 12. You are required to make use of headings, paragraphs and
subsections as appropriate, and all work must be supported with research and referenced using Harvard
referencing system.
The report - The recommended word count is 2500–3,000 words for the report although you will not be penalized
for exceeding the total word limit.
SECTION B:
This should be a 10-minute individual presentation prepared using a relevant software that includes a 5 minutes
question and answer session. The presentation slides and speaker notes should be attached together and submitted
as one copy. Students are required to make effective use of headings, bullet points and subsections as appropriate.
Research should be referenced using Harvard referencing system.
The recommended length is 1500–2000 words, including speaker notes, although students will not be penalized
for exceeding 2000 words.
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Unit Learning Outcomes:

LO2 Illustrate the potential impact of the law on a business
LO3 Examine the formation of different types of business organisations
Learning Outcomes and Assessment Criteria
Pass Merit Distinction
P1 Explain different M1 Evaluate the LO1 and LO2

sources of law. effectiveness of the legal D1 Provide a coherent
P2 Explain the role of system in terms of recent and critical evaluation of
government in law reforms and the legal system and law,
making and how statutory developments. with evidence drawn from
and common law is a range of different
applied in the justice relevant examples to
courts. support judgments.
LO2 Illustrate the potential impact of the law on a

business
P3 Using specific M2 Analyse the potential

examples, illustrate how impact on business
company, employment through differentiation
and contract law has a between legislation,
potential impact upon regulations and
business. standards.
LO3 Illustrate the potential impact of the law on a D2 Critically analyse the
business formation of different
types of business
P4 Explore how different M3 Analyse the organisations.
types of business organisations advantages and
are legally formed. disadvantages of the
formation of different
P5 Explain how business types of business
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organisations are organisations.
managed and funded.
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Assignment Brief and Guidance:
Section A
Scenario:
You are working in a law firm and advising new start-up companies on the legal system and key legislations
that they should know and how such legislations apply to their companies. You have been asked to produce a
handbook for the new companies in order to support the business advice and guidance given by you.
The handbook is expected to flow through a clear structure from the beginning explaining evolution of law,
various sources of law available and the practice of different legal systems. An explanation and a critical
reflection of the legal aspects that are relevant for new businesses that the start-up companies should be
aware of (need to demonstrate strengths and weaknesses by using examples). An explanation regarding
different aspects of operating and winding up businesses should be included. It is essential for new business
organizations to understand the importance of complying with governmental regulations, thus the handbook
should contain an explanation on the role of the government in law-making. To further specify, the report
should explain and evaluate the potential implications of law on a business such as including but not limited
to company law, contract law and employment law etc.
A section in the handbook should also be dedicated to differentiating between legislation, regulations and
standards and the applicability of them in businesses with examples.
Section B
Scenario:
In your role as a paralegal, you have been invited to attend a Small Business Expo conference that will be
held in Sri Lanka. You will be doing a presentation as a guest speaker on how different types of organisations
are legally formed and provide local advice and guidance to the businesses.
Present an introduction to different types and classification of business organizations in both public and
private sectors, providing specific examples to illustrate how organizations are being formed in different legal
structures. A critical review of the advantages and disadvantages of forming different types organizations in
the light of various legal structures is expected to be addressed with an evaluation of how different
organisations are managed and funded in both public and private sectors e.g. limited companies, social
enterprises, corporations, co-operatives. Provide a specific example of each category.
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Grading Rubric
Grading Criteria Achieved Feedback
P1 Explain different sources of law.
P2 Explain the role of government in law

making and how statutory and common
law is applied in the justice courts.
P3 Using specific examples, illustrate how

company, employment and contract law
has a potential impact upon business.
P4 Explore how different types of

business
organisations are legally formed.
P5 Explain how business organisations are
managed and funded.
P6 Compare and contrast different sources
of legal advice and support for dispute
resolution to make appropriate
recommendations to legal solutions.
M1 Evaluate the effectiveness of the legal
system in terms of recent reforms and
developments.
M2 Analyse the potential impact on
business through differentiation between
legislation, regulations and standards.
M3 Analyse the advantages and
disadvantages of the formation of different
types of business organisations.
M4 Recommend legal solutions for
resolving a range of disputes, using
examples to demonstrate how a party
might obtain legal advice and support.
D1 Provide a coherent and critical
evaluation of the legal system and law,
with evidence drawn from a range of
different relevant examples to support
judgments.
D2 Critically analyse the formation of
different types of business organisations.
D3 Critically evaluate the effectiveness of
legal solutions, legal advice and support
for dispute resolution.
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Contents
SECTION A.........................................................................................................15
1. Introduction......................................................................................................16
1.1 Purpose of the Handbook.....................................................................................16
1.2 Scope and Structure...........................................................................................16
2. Evolution of Law and Sources of Law...........................................................................16
2.1 Evolution of Law.............................................................................................16
2.2 Sources of Law...............................................................................................17
2.2.1 Statutory Law............................................................................................17
2.2.2 Common Law............................................................................................18
2.2.3 Case Law.................................................................................................18
2.2.4 Customary Law..........................................................................................19
2.2.5 International Law........................................................................................19
3. Role of Government in Law Making.............................................................................20
3.1 Legislative Process...........................................................................................20
3.2 Statutory Law and Common Law in Justice Courts.........................................................21
3.3 Judicial Review and Interpretation...........................................................................21
4. Legal Aspects Relevant to New Businesses.....................................................................22
4.1 Company Law................................................................................................22
4.2 Employment Law.............................................................................................25
4.3 Contract Law..................................................................................................27
5. Operating and Winding Up Businesses..........................................................................30
5.1 Business Formation and Registration........................................................................30
5.1.1 Sole Proprietorship.......................................................................................30
5.1.2 Partnership...............................................................................................30
5.2 Closing down the business...................................................................................32
5.2.1 Sole Proprietorship.......................................................................................32
5.2.2 Partnership...............................................................................................33
6. Differentiation between Legislation, Regulations, and Standards..............................................35
6.1 Legislation....................................................................................................35
6.2 Regulations....................................................................................................36
6.3 Standards......................................................................................................36
7. Conclusion........................................................................................................37
SECTION B.........................................................................................................39
Appendix.............................................................................................................40
References...........................................................................................................58
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SECTION A
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1. Introduction
1.1 Purpose of the Handbook
The manual seeks to give recently established enterprises a thorough understanding of the
legal system and pertinent regulations influencing their operations. It provides succinct
justifications and insights to assist business owners in making decisions, ensuring
compliance, and avoiding legal problems.
The manual enables start-up firms to successfully traverse the legal difficulties by arming
them with the early detection of legal concerns and proactive remedies. It underlines the
significance of adhering to the law in order to prevent pricey disputes, penalties, and
reputational harm.
The handbook's ultimate objective is to provide new businesses with the information and
understanding of the legal system and significant laws they need to establish a strong legal
foundation and successfully navigate the complexities of the legal landscape.
1.2 Scope and Structure
The manual attempts to give newly established enterprises a thorough understanding of the
legal system and significant laws. It discusses a variety of subjects, such as how laws are
developed, how governments pass laws, and how legal problems could affect enterprises.
The handbook's well-organized form makes it simple to explore and understand difficult legal
subjects. The introduction provides background information by offering an overview of legal
systems and historical development.
The legislative procedure and judicial review are then thoroughly explained, illustrating how
courts can affect legal decisions.
The guide goes on to discuss specific legal issues that pertain to businesses, including
company law, employment law, contract law, consumer protection, and intellectual property
law.
The establishment, registration, taxation, and financial aspects of running a firm are all
crucial.
2. Evolution of Law and Sources of Law

2.1 Evolution of Law
Law has evolved over many years and is closely tied to the rise of human civilisation. Law is
a dynamic system that adjusts to the shifting demands, ideals, and difficulties of society
rather than being a static thing. For new start-up businesses, comprehending the historical
background of law is essential because it sheds light on the formation and growth of the legal
system that governs their operations.
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The development of norms, practices, and laws by societies to control behavior and uphold
order can be traced back to early civilizations. These early systems of law frequently drew
their inspiration from religious convictions, cultural practices, and social norms. The need for
more formal and structured legal systems grew over time as societies got more complex and
interdependent.
The Roman Empire saw a great advancement in the development of law, with the
codification of legal principles and the establishment of legal institutions. Numerous
contemporary legal systems around the world have their roots in the Roman legal system,
particularly the Corpus Juris Civilis. Legal systems today are still influenced by Roman law's
tenets, which included the emphasis of legal reasoning and equality before the law.
Parallel to this, other legal customs emerged, such as the English common law system.
Instead of codified statutes, common law is based on court judgments and judicial
precedence. It developed as a result of judges applying legal ideas and using precedent to
help them make judgements. Many legal systems, including those in the United States and
other Commonwealth nations, have been significantly impacted by the common law system.
More complex legal systems became necessary as societies developed. Due to this, statutory
law—which involves legislative bodies passing laws—was developed. In many jurisdictions,
statutory law has replaced common law as the main source of law because it offers a more
codified and centralized method of enacting legislation.
Numerous additional sources of law have evolved and added to the legal system in addition
to statutory law. These include case law—court rulings that set legal precedents—customary
law—a community's long-standing norms and customs—and international law—which
regulates interactions between sovereign states.
The development of law is also significantly influenced by legal doctrine and precedents.
Precedents are earlier court rulings that act as a reference for instances with related legal
concerns in the future. Legal ideas, principles, and interpretations created by legal scholars
and specialists are referred to as legal doctrine.
Start-up businesses can gain important insights into the development and context of the legal
system they operate within by understanding how the law has changed through time. They
gain a better understanding of the guiding ideas and justifications behind various legal
doctrines and notions. Startup businesses can more effectively traverse the complexity of the
legal environment and make decisions that are compliant with the law and in line with
societal norms by understanding the historical roots of law.
2.2 Sources of Law
Law draws from multiple sources that contribute to the development and application of legal
systems. Understanding these sources is essential for start-up companies to navigate the legal
landscape effectively and ensure compliance with applicable laws and regulations.
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2.2.1 Statutory Law
Statutory law describes legislation passed by legislative bodies like congresses or parlaments.
These laws have been codified and offer a framework for rules and laws that control many
facets of society. Statutory laws, which are enforceable by both people and businesses in the
jurisdiction, are frequently developed to solve certain problems or difficulties. They include a
wide range of topics, including as contract law, employment law, and the law relating to the
environment. To maintain compliance and prevent legal repercussions, start-up businesses
need to familiarize themselves with the pertinent statutory provisions that apply to their
company activities. (hg,nd). Example for Statutory laws include, for instance, those
pertaining to drug possession, driving with a suspended license, and traffic rules (Todd
Coolidge,nd).
2.2.2 Common Law

Common law, which is frequently referred to as case law or judge-made law, gets its
authority from court judgments rather than from legislative acts. It is a legal system in which
judges formulate and apply legal principles by applying their interpretation of statutory
provisions, prior cases, and accepted practices. The idea of stare decisis, which states that
judges are bound by earlier rulings in related situations, is the foundation of common law.
This rule guarantees uniformity and predictability in the results of legal proceedings. New
businesses operating in common law nations need to understand how judicial rulings and
legal precedents might influence their legal rights and obligations.
(Branka Vuleta,2022). An example of common law is Tompkins v. Erie Railroad 1934
In Hughestown, Pennsylvania, on July 27, 1934, Harry Tompkins was strolling along a
constrained walkway next to the Erie Railroad rails. Tompkins was thrown to the ground as a
train approached, his arm crushed beneath a train wheel by something sticking out of one of
the railcars. As a result of the fact that the train was run by a New York-based firm,
Tompkins chose to launch his legal complaint there.
In this instance, the district court judge applied federal common law rather than Pennsylvania
or New York common law, in accordance with the then-current federal legislation. When
deciding what degree of care the railroad owed to people who are not railroad employees,
federal common law used a standard of "ordinary negligence." According to Pennsylvania
common law, where the incident took place, trespassers are owed a "wanton negligence" duty
of care by the railroad, which calls for evidence of a higher degree of negligence. The judge
ruled in Tompkins' favor and gave him a judgment for damages.
Before the decision of Tompkins v. Erie Railroad, it had already been established that state
statutes must be followed when a matter is considered in federal court in diversity, which
means that it was filed there because it involves multiple states. But it had also been decided
that a federal court hearing a case on the basis of diversity was not compelled to use the
state's common law or precedent.
The railroad filed an appeal on the case with the appellate court and the U.S. Supreme Court.
After considering the issue, the Supreme Court decided that the federal district court was
required to follow state common law rather than federal common law when evaluating state
law claims in diversity.
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2.2.3 Case Law
The body of law developed as a result of judicial decisions is referred to as case law. Court
rulings create legal precedents that direct future interpretations and judgments. In common
law jurisdictions, where courts frequently depend on precedent to determine legal decisions,
case law is especially important. Start-up businesses should study pertinent case law in their
jurisdiction to learn how judges have applied and interpreted the law in cases comparable to
their own. An example of case law is Stacy v Martin
Using a new state legislation that mandates a minimum of 90 days' notice, Stacy, a tenant in a
duplex owned by Martin, launched a civil complaint against her landlord, saying he had not
given her enough notice before raising her rent. Martin contends that the new legislation
mainly affects owners of substantial multi-tenant buildings. When the state judge hearing the
case examines the statute, he discovers that while it makes some reference to large multi-
tenant properties, it is actually extremely ambiguous as to whether the 90-day rule applies to
all landlords. Based on the particulars of Stacy's case, the judge finds that the 90-day notice
obligation applies to all landlords and rules in Stacy's favor.
Frank and Adel experience the same issue a year later. The legislation must be applied by the
court using the prior court's ruling when they sue their landlord. This case law illustration
pertains to two cases that were heard on the same level in state court. The original court's
decision established precedent that must be observed by subsequent courts until new
legislation is passed or a higher court issues a decision that deviates from it. (Legal
dictionary,2016).
2.2.4 Customary Law

Customary law is a source of law that arises from long-standing practices and traditions
within a particular community or group. It is unwritten law that develops over time through
the repeated and accepted behaviour of individuals. Customary law often governs areas
where formal legal systems may not reach or where specific cultural or social norms are
recognized. Start-up companies operating in regions where customary law plays a significant
role should be aware of its influence and adapt their practices accordingly(Benson,2019)
2.2.5 International Law

The interactions between sovereign governments, global institutions, and private persons are
governed by international law. It is made up of treaties, conventions, agreements, and
customary practices that govern matters including trade, diplomacy, human rights, and armed
conflict. Global corporate transactions, cross-border operations, and adherence to
international norms all depend heavily on international law. Startup businesses should be
aware of the pertinent international laws and treaties that are applicable to their operations.
(Legal dictionary,2017). An example of international law is
3. Anglo-Norway Fisheries case

Subject: Elements of international custom
Facts:
The United Kingdom disputed a 1935 Norwegian order that claimed territorial seas extending
beyond 4 nautical miles. The point from which the territorial seas were to be determined thus
became crucial, and the ICJ granted Norway (which, under the UNCLOS, is an archipelagic
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State because it is a collection of islands) judicial recognition. The islands are connected to
the mainland, so Norway used a straight baseline method to determine how much of the sea
should be included in its territorial waters. This method interfered with the UK's fishing
rights in the same waters because it took the outermost point of the archipelagic islands and
drew a straight line from it to the mainland. UK claimed that the standard calculation
technique is as stated in UNCLOS Article 5, which states that "the standard baseline for
measuring the breadth of the territorial sea is the low-water line along the coast as marked on
large-scale charts officially recognized by the coastal State."
Issue:
When the matter was brought before the ICJ by both parties, the question of whether the 1935
Norwegian order was in compliance with then-current international law was at stake.
Holding of the court:
The Court noted that Norway's historical ownership of the seas had contributed to their
treatment as an exception in the methodology used to establish their baseline. The court
concluded that a State may be justified in deviating from the standard baseline rule to identify
its territorial seas in unusual situations, such as the Anglo-Norway fisheries case. This
conclusion is supported by Article 7 of the 1982 UNCLOS, which addresses straight
baselines. (Finology,2023)
3. Role of Government in Law Making

3.1 Legislative Process
To build and implement legal systems, the role of government in lawmaking is essential.
Governments have the power to enact, modify, and remove the laws that govern society
through their legislative bodies. To comprehend how laws are created and implemented, start-
up businesses must have a thorough understanding of the legislative process. It also
emphasizes how crucial public input is to the creation of laws.
Several important steps are normally involved in the legislative process. It starts with the
determination that new legislation is necessary, or that existing laws need to be amended.
This could result from societal transformations, new problems, or popular desires.
The proposed legislation's drafting is the next step. The law's text is developed in
collaboration with important stakeholders, government representatives, and legal
professionals. This procedure involves giving considerable thought to legal precepts, political
goals, and prospective effects.
The draft legislation is examined and reviewed after it has been created. It might be the
subject of public hearings, stakeholder consultations, and parliamentary discussions. This
step encourages transparency in the legislative process and welcomes feedback from all
viewpoints.
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The legislative body normally votes on the legislation after the review phase. To become
legislation, it might need to receive a majority vote or special majority. Depending on the
governing structure, the legislation is next sent for formal enactment, such as getting royal
assent or a presidential signature. (polyas,n.d).
3.2 Statutory Law and Common Law in Justice Courts
Common law principles and statute law are frequently combined in the legal system, with
each having a specific function in justice courts.
As was already explained, the legislative process produces statute law. It includes statutes
that have been codified with laws that have been passed by legislatures. These laws offer
precise rules and regulations that control particular spheres of society. Startup businesses
must be informed of the pertinent statutory laws that apply to their operations. For instance,
employment regulations may specify the duties and responsibilities of both employers and
employees, providing just and equal treatment at work.
In contrast, common law is based on judicial rulings and earlier cases. It is founded on the
idea of stare decisis, which states that judges are constrained by earlier rulings in cases that
are similar to the current one. Judges' interpretation and application of legal doctrines results
in the development of common law. To ensure uniformity and predictability in their rulings,
courts look to legal precedents. Startup businesses should be aware of the applicable common
law rules in their jurisdiction since court rulings can set legal precedents and affect their
rights and obligations.
Statutory law and common law interact in justice courts and have an impact on judicial
decisions. When interpreting and resolving disputes based on specific legislative provisions,
judges use statutory law. They also take into account pertinent case law and common law
principles to make sure that their judgments are fair and consistent. (Todd Coolidge,n.d)
3.3 Judicial Review and Interpretation

A crucial component of the legal system is judicial review, which enables courts to examine
the constitutionality of laws and their application. This authority guarantees that laws adhere
to constitutional principles and do not restrict the freedoms and rights of individuals.
The validity and constitutionality of laws and government activities may be reviewed by
courts. They have the power to overturn legislation that are ruled to be unconstitutional or to
violate basic rights through judicial review. In order to make sure that the legislative and
executive parts of government are acting in accordance with the fundamental principles of the
constitution, this system serves as a check on them.
In addition, courts have a big influence on how laws are interpreted. By applying legal
precedents and principles to the text and intent of legislation, they can determine its
interpretation and set legal norms. Judicial interpretation offers assistance on how to apply
statutes and clarifies unclear or vague clauses.
New businesses ought to understand the value of judicial review and interpretation in the
legal system. It emphasizes the part played by courts in formulating laws, settling disputes,
and ensuring that laws are applied correctly. Start-up businesses can foresee prospective legal
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issues and make wise judgments based on how the law is interpreted and applied by
comprehending the dynamics of judicial review (C.Neal.Tate,2023)
4. Legal Aspects Relevant to New Businesses

4.1 Company Law
The Companies Act of 2006 (the 2006 Act), which governs most aspects of company law in
the UK. The requirements for the production, distribution, and filing of accounts and reports,
including the selection of an accounting system, are outlined in Part 15 (sections 380 to 474).
Regulations that include, for instance, specific standards for the structure and content of
financial statements serve as a supplement to these requirements. The broad requirements for
accounts to be audited are outlined in Part 16 along with exemptions for specific companies,
guidelines for the appointment, dismissal, and resignation of auditors, and information on
auditors' liability.
The 2006 Act is comprehensive and includes practically all of the legal requirements that
apply to businesses. Its criteria are not constant and are occasionally changed. This is
typically accomplished through the use of statutory instruments, or regulations, which are
subject to a less rigorous legislative process than Acts of Parliament.
Distributable profits
The legislation on distributable earnings (i.e., what may be lawfully paid out as dividends) is
one area of the 2006 Act that is directly tied to financial reporting. Sections 829 through 853
of Part 23 detail these requirements. Despite being rather succinct, they are challenging to
apply in the context of current financial reporting rules. The Institute of Chartered
Accountants in England and Wales (ICAEW) and the Institute of Chartered Accountants of
Scotland (ICAS) have provided extensive recommendations on this topic. To help businesses
determine whether profits are realized and eligible for dividend payments, the ICAEW and
ICAS jointly released updated guidance in April 2017.
Directors' remuneration
The 2006 Act and associated regulations include disclosure requirements for director
compensation. Except for minor businesses, every company is obligated to provide some
information regarding the total amount paid to the directors. The creation of a directors'
remuneration report, which includes specific information about each director's compensation,
is subject to far stricter standards for quoted businesses.
Every year, all quoted UK registered firms with more than 250 UK employees are required to
publish and explain in their directors' remuneration report the pay ratios, sometimes known as
the pay gap between CEOs and their staff. To help shareholders make informed decisions
when voting on long-term incentive plans, these corporations will also need to provide
examples of how future share price rises would affect CEO pay results.
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Companies (Directors' Remuneration Policy and Directors' Remuneration Report)
Regulations 2019 were established in May 2019. On June 10, 2019, the Regulations, which
carry out the SRD's (Revised Shareholder Rights Directive) provisions, went into effect.
Narrative reporting
Narrative reporting, sometimes known as the "front end" of the annual report, is receiving
more attention. All UK-registered firms must create a directors' report with certain basic
information, including - for "large" corporations and LLPs - specific disclosures on energy
use and carbon emissions. This requirement excludes those qualifying as micro entities
starting on January 1, 2016, though.
All businesses that are not "small" as defined by the Companies Act of 2006 must also create
a strategic report outlining their activities as well as the main risks and uncertainties they
face. 'Large' corporations must additionally include a section 172 (1) statement in their
strategy report, and some businesses must also disclose financial data relating to climate
change.
Quoted firms are subject to additional disclosure obligations in their strategic reports, which
include a description of the company's or group's strategy and business model as well as
larger environmental, social, and governance (ESG) issues. The FCA Listing Rules also lay
forth additional disclosure requirements.
Corporate Governance
A statement describing which corporate governance code, if any, has been used and how is
needed to be included in the directors' report of UK-registered firms with 2,000 or more
global workers, a global turnover of over £200 million, and a global balance sheet exceeding
£2 billion. When a company is required to provide a corporate governance statement (such as
premium and standard listed companies), when it is a community interest company (as
defined by section 26 of the Companies (Audit, Investigations and Community Enterprise)
Act 2004), or when it is a charitable company (as defined by section 193 of the Charities Act
2011), it is exempt from the requirement. The declaration of corporate governance
arrangements must include an explanation of the company's decision to forego using a
corporate governance code for the financial year, as well as the corporate governance
arrangements that were used during that time period (iasplus,n.d)
A case example that applies to company law is CL 1. ARUNA OSWAL V. PANKAJ

OSWAL & ORS [SC]
Provision Involved:
Every security holder has the right, under Section 72 of the Companies Act of 2013, to
designate the person to whom his securities will "vest" in the case of his death. When a
nomination is lawfully made in the way specified, Section 72(3) takes precedence over any
provisions of any other legislation that is currently in effect or any disposition, whether
testamentary or otherwise. It claims to grant anyone "the right to vest" in company securities,
and all ownership rights in those securities will pass to the nominee unless and until the
nomination is changed or withdrawn in accordance with the authorized procedure. Primarily,
once shares vest in a nominee, he assumes ownership of the securities outright and is eligible
to vote at company meetings.
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Brief Facts:
• The case is the result of a conflict in the family. The respondent No. 1 is the son of the
appellant and was the owner of 11.11% and 39.88% of the shares respectively of M/s.
Oswal Greentech Limited.
• He submitted a nomination on behalf of the appellant, who was listed as the holder of
the shares that her late husband had owned.
• The first respondent filed a partition lawsuit, claiming a fourth of his father's shares in
the two companies mentioned above. He also submitted a petition to the NCLT
alleging that his mother and other people were the targets of oppression and
repression
• The petition's maintainability was contested by the appellant, among other things, on
the grounds that respondent No. 1 lacked the necessary shares to file the petition.
• The application was denied by the NCLT. According to the NCLT, respondent No. 1
is the legal successor and is therefore entitled to one-fourth of the assets/shares.
• As a result, complaints were made to NCLAT, which were later dismissed by the
contested judgment and order. Due to their grievance, the appellants have come
before this court.
Decision:
NCLT and NCLAT's decisions were overturned by SC. (SC ruled that NCLT/NCLAT cannot
assume the final holding of shares that the petitioner might get from the civil court until the
civil court has completed the partition dispute.)
Reason:
The Supreme Court ruled that respondent No. 1 bought a 0.03% stake in M/s. Oswal Agro
Mills Ltd. in June 2017 after initiating a civil lawsuit, and that the 9.97% stake, which he is
claiming on the basis of his status as a legal representative, is in doubt. The dead owned
11.11% of the stock in M/s. Oswal Greentech Ltd., of which respondent No. 1 claims a
quarter. As a result, we are certain that respondent no. 1 does not possess enough shares to
meet the 10% eligibility requirement set forth in section 244 in order to continue to submit an
application under sections 241 and 242.
Admittedly, he is also asserting a one-fourth interest in the shares that the deceased had in a
legal complaint for division. The civil court's decision will be conclusive, final, and binding
on all parties in the dispute over the right, title, and interest in the securities. Before the
ownership rights are ultimately resolved in the civil matter, it would not be proper to treat the
shareholding in respondent No. 1's name by NCLT.
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Therefore, the SC left it up to the ongoing civil lawsuit to decide all of the issues. The NCLT
and NCLAT orders that are being contested are reversed, the appeals are granted to the
aforementioned extent, and it is urged that the civil matter be resolved as quickly as possible.
(legalmantra,n.d)
4.2 Employment Law
What is employment law?
The area of law known as employment law is responsible for regulating the relationship
between an employee and their employer, as well as both sides' rights and obligations. It aids
in making a workplace suitable and safe to work in, controls the number of hours an
employee may put in, and establishes the pay that an employee is eligible to earn. Numerous
rules from all governmental tiers are part of employment law. Due to the complexity of
employment law, it is sometimes subdivided into other categories, including workplace
behaviour, salaries, benefits, and family and medical leave.
Workplace discrimination
When an employee who belongs to a protected class is treated differently from their
coworkers, it is discrimination. Although prejudice can take many different forms, it is
illegal. Here are a few words related to discrimination in employment law:
• Title VII: Title VII forbids discrimination in the workplace based on traits including
race, color, religion, sex, or national origin.
• The Age Discrimination in Employment Act forbids age-based discrimination by
employers.
• The Equal Pay Act: This statute guards against gender-based salary and benefit
discrimination.
• The Americans with Disabilities Act (ADA): This law forbids discrimination against
people with disabilities and mandates that employers make reasonable
accommodations for their disabled workers.
 The Pregnancy Discrimination Act amended Title VII to forbid discrimination by
employers on the grounds of pregnancy or a condition associated with pregnancy or
childbirth.
• The Genetic Information Nondiscrimination Act (GINA) forbids discrimination based
on a person's genetic information.
Wages and benefits

Many firms give their workers access to benefits like health and dental insurance, paid time
off, and retirement programs in addition to paying hourly earnings or annual salary. The
majority of an employee's benefits and salary are governed by employment law. Several
significant words related to this area of employment law include the following:
• Fair Labor Standards Act (FLSA): This law defines what constitutes work and
prescribes minimum hourly wages as well as overtime pay.
• Minimum wage: Depending on the region, the minimum wage is the lowest amount
an employer is permitted to pay its employees.
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• Overtime pay: This is the sum that an employer is required by law to give an
employee who works more than 40 hours per week, usually at a higher rate of pay
than their regular rate.
• Wage garnishment: This is when an employer deducts money from an employee's
paycheck to settle a debt.
• The Consolidated Omnibus Budget Reconciliation Act (COBRA) permits employees
and their families to continue using their group health benefits at the same level even
after they leave their jobs.
• Employee Retirement Income Security Act (ERISA): This law regulates how
businesses manage pension plans and healthcare benefits, requiring employers to
operate plans in accordance with a specific set of guidelines.
• Employers occasionally offer to cover all or a portion of an employee's training-
related tuition as a requirement of employment.
• Employees have the chance to purchase shares of their company via stock options.
• Employees can choose specific benefits from a list and up to a set dollar amount
under a cafeteria-style benefits plan.
Health and safety
Every employee has the right to work in a secure environment free from specific risks.
According to employment law, if an employee gets hurt at work, the government can make
the employer pay for their medical bills. Here are a few essential words related to
employment law that pertain to workplace health and safety:
• Occupational Safety and Health Administration (OSHA): OSHA is the regulatory

body in charge of developing and enforcing health and workplace safety regulations.
• The Occupational Safety and Health Act, which established standards and included
provisions for particular industries like the construction industry, aids in reducing
risks at work.
• The term "occupational disease" refers to any illness connected to a certain work
setting.
• Environmental hazard: In the workplace, an environmental hazard is any substance
that poses a risk to human health or the environment.
• A strategy known as an emergency action plan is implemented during emergencies,
usually because of the risk present at certain work sites.
Additional aspects of employment law
Employment law frequently focuses on labor relations, unemployment compensation, family

and medical leave, employee contracts, immigration, and even the hiring process in addition
to health and safety, salaries and benefits, and discrimination. Some areas of employment law
may require particular consideration in certain businesses. Here are a few more terminology
associated with employment law:
• Employment at-will: In this situation, neither the employer nor the employee are
bound by a written contract and are free to end their working relationship at any
moment for any reason.
• Wrongful termination: When an employee's employment is improperly terminated by
the employer, this is known as a wrongful termination.
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• Non-competition agreement: In this contract, the employee promises their employer
that they won't work for a rival company, usually for a set period of time.
• Unemployment: This is a sort of compensation given to someone who has lost their
work and often consists of a portion of their prior salary.
• Whistleblower: People who disclose criminal activity by their employers to the police
are given access to certain legal protections. (indeed,2023)
A case example that applies to employment law is Mencap v Tomlinson-Blake and Shannon
v Rampersad
National minimum wage - shift-based sleep compensation
The Supreme Court had to rule in the cases Mencap v. Tomlinson-Blake and Shannon v.
Rampersad (t/a Clifton House Residential Home) whether employees who provided sleep-in
cover should be paid at the proper NMW rate for every hour of their sleep-in shift—even if
they didn't do any work.
It was decided that employees who must sleep at or close to their place of employment in
order to respond to crises, etc., do not have a right to NMW rates of pay while they are
asleep. However, they are need to receive NMW when awake in order to perform their jobs,
such as reacting to an emergency call.
Why it's important
Even while this ruling primarily affects the care industry, night watchmen and emergency call
takers may also be affected.
If you hire someone whose sole job is to sleep and you give them the tools to accomplish it,
you only have to pay them the applicable NMW rates if they are required to work during their
shifts; but, you are not required to do so if they are unable to sleep for any other reason (due
to noise, etc.). For any time they aren't working, you might agree on a separate pay rate with
them.( Joanne Moseley,2022)
4.3 Contract Law
What exactly is contract law?

The subset of laws that particularly governs how contracts are made and upheld is known as
contract law. These regulations cover issues like:
 how agreements are made

 What a contract must have in order to be deemed one
 Who may engage into a contract?
 What penalties are there for contract violations?
 What parties to a contract may be expected to do
In essence, contract law clarifies when agreements are made, under what circumstances they
are enforceable, and how the offended party may pursue legal action against the other
signatory.
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The fundamental elements of a contract
Any contract must have three key elements: the offer, the acceptance, and the consideration.
A document is not regarded as a contract if any one of these three requirements is missing.
1. Offer
The offer is a distinct, voluntary, and explicit opportunity made by one person to another.
Specific conditions will be presented to the offeree by the providing party, or offeror.
Included on this list should be:
a definite statement of intent to enter into a contract.

Information provided by the offeree identifying those qualified to accept this contract.
what the bidder promises to deliver under the terms of the contract, such as products or
services.
The agreement's parameters, including what the offeree will give in return and how the trade
will be made, will also be outlined.
2. Acceptance
Next, contacts must include a clear acceptance of the offer. Acceptance can take three forms:
 Words: Most agreements to engage into a contract and abide by its terms are
expressed verbally or in writing by the offeree.
 Actions: Acting is another way to accept contracts. Imagine, for example, that a
contract says that browsing a website or clicking a link demonstrates acceptance.
People who take certain activities after reading the contract automatically accept the
terms.
 Performance: Even if a contract doesn't list a specific action that counts as acceptance,
you can nonetheless accept it by doing so. A contract is indicated when a restaurant
accepts a delivery of food from a supplier and uses it to prepare cuisine. The
restaurant and the supplier may infer that a contract was formed because the items
were used in the course of business, and the restaurant is responsible for paying the
supplier for the food.
3. Consideration
The value being offered is the contract's consideration. This number may be:
monetary, like a loan

property, such as delivered products
Services, such as upkeep or injury protection
There is no requirement that a contract have a certain kind of compensation, or even that
money be involved. As long as the agreement specifies that one party will give something to
another party that has a predetermined value, consideration has been given, and the contract
is complete.
What constitutes legal contracts?

However, contracts go beyond their fundamental design. A contract that satisfies the
requirements but is not enforceable is quite possible. A contract is legitimate if it adheres to
the proper format and fulfills the conditions listed below:
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doesn't go against the law
Legal contracts can only be considered valid if they comply with the law. Any agreement that
contravenes public policy or obliges one party to act illegally is instantly void. For instance, a
contract that mandates that one party disregard local tax rules is against public policy and
cannot be upheld in court.
An agreement may become invalid in whole or in part due to an unenforceable clause. Some
contracts have clauses that state that any conditions that are against local law will be
disregarded, but the rest of the contract will stay. Nevertheless, the entire contract will
typically be regarded as unenforceable if the infraction relates to a key aspect of the
agreement.
All sides have the ability to agree.

Verifying that all parties are eligible to consent is a crucial step in the contracting process.
Having the "capacity" to enter the contract is what this is referred to as. It is never presumed
that certain populations, such as children or persons with mental disabilities, have the
capacity.
Other parties might only possess the capacity under specific conditions. If a business can
demonstrate that it is a legitimate legal entity and that the individual signing the contract is an
authorized representative of the business, the business may enter into a contract. Without
these components, a contract can be deemed null or voidable.
Each party has read, understands, and accepts the terms.

When all parties genuinely agree to the terms of a contract, it is deemed legally binding.
Genuine consent can only be given if all parties are aware of what the agreement entails,
including what they will get and need to perform.
The contract contains errors or misrepresentations that preclude parties from providing real
consent. Whether a contract error was an unintentional oversight or a deliberate deception,
the misled party might nevertheless file a lawsuit to make the contract void. Due to the
deceived party's lack of understanding of the agreement's actual contents and unable to assent
to them, the contract would be void. (ironcladapp,n.d). A case example that applies contract
law is Balfour v. Balfour (1919)
The legal response hypothesis in contract law was founded on the Balfour v. Balfour case
from 1919, which also served as the impetus for its development. According to the legal
reaction principle, a first legal act will trigger a second legal act. According to Lord Justice
Atkin, agreements between a husband and wife, particularly those relating to personal family
relationships and involving the provision of maintenance costs and other related capitals, are
typically not classified as contracts because, in most cases, the parties do not intend to enter
into an agreement that should be attending legal ends. As a result, a contract cannot be
enforced by nature if the parties do not intend to enter into a legal relationship (Oishika
Banerji,n.d).
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5. Operating and Winding Up Businesses
5.1 Business Formation and Registration
5.1.1 Sole Proprietorship
A sole proprietorship can be established quite easily. This is due to the lack of the typical
legal obstacles that other corporate organizations require you to overcome. In most
circumstances, declaring yourself as the owner and beginning operations is all that is
necessary to launch the organization. There are specific actions you can take to formally
begin your sole proprietorship depending on where you live.
1. Obtain your business license and all necessary permissions. In some states, you must
submit applications for both permits and licenses (for business or occupancy). To find
out if you require any specific papers to launch your firm, check with your state or
county clerk.
2. If your state mandates it, you might need to register your company under its Doing
Business As name. If this isn't the case, you can use an alias, which is typically just
your own name. Remember that operating a sole proprietorship under your name may
have legal repercussions.
3. Request and receive an EIN. This is a crucial and required step if you intend to hire
any staff members or file tax returns. If none of this applies to you, you may use your
own SSN. In either case, it's wise to consult a tax professional to avoid any blunders.
(Twin,2023)
5.1.2 Partnership
Step 1: Choose Your Business Partners
Step 1: Choose Your Business Partners Unsurprisingly, the first step in starting a business
partnership is to choose your partner(s). If you’re already considering a partnership, you’ve
probably already got people in mind, but if not, there are some things to look out for in
partners.
Look for individuals who not only share your goals, work ethic, and vision but with whom
you really love being around and doing business. Additionally, you'll need to recruit partners
who are prepared to split the business's obligations, liabilities, and earnings.
Find partners that have abilities that compliment your own, if you can. You may make sure
you're covering more important business areas by selecting partners with diverse talents and
experience.
Step 2: Pick a Partnership Structure
After selecting your partners, you must determine the type of company partnership you wish
to establish. There are three possibilities, as we've already discussed:
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Partnerships with limited liability and general partnerships.
Choose your structure carefully because it will affect how you register your business, pay
taxes on it, and manage it.
Step 3: Decide on a Business Name
After deciding on your partners and organizational structure, you must choose a company
name. You must consider both your target market and Companies House's naming rules
while selecting a name.
Your name must match the requirements of Companies House.
Unique
not the same as a name of an existing corporation
Inoffensive.
Using our company name checker, you may determine whether a business name has
previously been registered with Companies House.
It can be a little more difficult to come up with a name that appeals to your target market, but
it's definitely worth the effort to get the ideal company name. Pick a name that is as close to:
Short Memorable
Simple to spell.
Step 4: Create a Partnership Agreement
You should take the time to draft a partnership agreement with the other partners before you
begin developing logos and your business website. An official document that describes the
conditions of your partnership is a partnership agreement. It addresses a variety of topics,
such as:
• How you two will manage the company

• How to allocate profits and losses
• What happens if a partner leaves the business.
• While there’s no legal requirement for partnerships to have an agreement in place, we
highly recommend creating one. By starting out with an agreement in place, you can
avoid potential conflicts and disputes in the future.
Step 5: Register Your Partnership

• Registering your partnership is the last step before you take your new company
global. The partnership structure you choose will determine how you register your
partnership. Here is a brief explanation of each structure's registration procedures:
• General partnership: You must file a general partnership registration form with
HMRC. You can do this online; all you need is a business name and a partner who has
30
been designated. Your designated partner will be in charge of communicating with
and complying with HMRC.
• Limited partnership – While still simple, registering a limited partnership is a little

more difficult than registering a general partnership. You must register your company
with Companies House and provide them with the name of the company, the address
of the registered office, and a list of all general and limited partners. A modest fee will
also be due.
• Limited liability partnership — Again, it's a little trickier to register a limited liability
partnership since Companies House needs more information. You must provide your
business name, registered office address, the information of two or more designated
members, and an LLP agreement in order to register.
• Many businesses register their partnership using a formations company like Mint
Formations to ensure the correct registration. This way, they can be confident that
HMRC or Companies House receive everything they need for a successful
registration. (mintformations,2023)
5.2 Closing down the business
5.2.1 Sole Proprietorship
How to Dissolve a Sole Proprietorship

The dissolution of a sole proprietorship involves the following steps:
• Notifying customers that the business is closing is the first step. Most states don't
require any formalities for a solo proprietor to close their business. But it's crucial to
disband in a timely manner. Send consumers letters apologizing for the closure and
thanking them for their patronage.
• Inform creditors of the business's impending closure and ask for a final invoice so you
may pay off all outstanding debts.Pay off all of your unpaid business debts. You must
pay the remaining sum from your business assets if your debts are more than your
assets.
• Set aside enough cash for unforeseen costs and creditors. Set aside enough money to
cover your responsibilities in case the case in which the business is involved does not
end in your favor.
• Offset any unused business assets by selling them. A sole proprietorship will have all
of its business assets in your name, allowing you to sell whatever remains after paying
off all of your financial commitments.
• If the sole proprietor's death or disability caused the dissolution, the representative
should strive to collect any accounts payable, either by working alone or with a
collection agency. It's possible that the owner gave directions in a will or trust deed
regarding asset liquidation and collection. The representative should liquidate the
company's goods and assets using the instructions as a reference before notifying
clients and creditors of the dissolution. Asset liquidation may be able to generate the
money needed to pay off business obligations and loans. To avoid any tax problems,
the representative should also close the company's bank accounts and investment
accounts.
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• If a sole proprietorship employs a "doing business as" name, it must file a request to
have it cancelled. The same organization that registered the name will manage the
cancellation procedure.
• Complete any outstanding federal and state tax responsibilities. • Pay final payroll
taxes if you have employees; • Save and submit final tax reports to the appropriate
federal and state taxing authorities. Before shutting the business, the representative
must submit a final tax return for the year of death and notify the IRS and state tax
authorities of the sole proprietor's passing.Any state or local licenses or permissions
must be revoked by the company's owner or representative.
• Bequests: A deceased business owner's will or trust arrangement could choose a
beneficiary to receive the assets of the business. Any residual business assets will be
held in custody by the beneficiary, who will also be responsible for the company's
debts. Unless the business is registered as an entity under a different name, the
recipient will be personally accountable for its debts if they want to carry on with it
(upcounsel, n.d.).
5.2.2 Partnership
1. Review your partnership agreement
You and your spouse decided in your contract how you would react if one of you wanted to
leave the relationship or if one of you thought the other wasn't doing their fair share.
Your partnership agreement needs to include "how the assets will be divided, terms of a
buyout, and how to handle the dissolution if one partner is bankrupt," according to Reuben
Yonatan, founder and CEO of GetVoIP, who has disbanded a partnership.
The Uniform Partnership statute will apply if you didn't sign a contract and you live in the
United States, according to Yonatan, if the partners reside in one of the 37 states that uphold
the statute. Whether or not there is a written contract in place, you should still speak with an
attorney to learn more about your legal options.
2. Approach your partner to discuss the current business situation
Heinrich Long, a privacy specialist with Restore Privacy, had a meeting with his attorney
before contacting with his business partner to discuss their partnership agreement "to ensure
termination could end amicably without any disputes."
He was ready to discuss his intention to end the partnership when he and his partner finally
did so. "We talked about potential opportunities and collaborated on an exit plan. We had
probably never worked so closely or so effectively together before," he claims. Even better,
according to him, "a relatively good personal relationship," they were able to preserve.
"If you want your partner to leave, you have to convince them and, in most cases, it's all
about giving up something—a certain percentage of the revenue, for example," asserts Adam
Hempenstall, founder and CEO of Better Proposals.
Before you start this talk, consider what you would be willing to take and what you would be
willing to give up to leave the company.
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It's time to formalize your agreement once you have decided what will happen to the firm,
whether one of you is buying out the other or the two of you have decided to close it down.
According to Michelle DelMar, Esq. of the DelMar Law Offices, "the business dissolution
process varies depending on the type of partnership or entity under which the business
operates and the terms of the business agreement effective at the time of dissolution."
She notes that the official procedure is also determined by the type of partnership. For
instance, DelMar cites general partnerships, limited partnerships, limited liability companies,
professional limited liability companies, etc. as well as partnership agreements or limited
liability company agreements that have an impact on how and under what circumstances
businesses can be dissolved.
3. Prepare dissolution papers

You should have a knowledgeable and experienced company attorney create official
partnership dissolution forms in order to validate and establish your agreement. You should
be informed of the various rules that apply in each state.
A well-drafted agreement for the dissolution of a business partnership or limited liability

company should, in DelMar's words, "address a number of important issues, including the
ongoing expectations, rights, responsibilities, and limitations of each of the partners or
members of the company, trademark assignment and/or right to use the company trademark,
assignment of intellectual property, final tax return information, liquidation of assets, releases
of liability, future obligations, and future tax consequences."
DelMar advises against being quick, even though you might want to file dissolution
documents with your state right away. The downside of formal breakup is that.
Despite the fact that corporate operations may have ended, she advises against dissolving
some companies and partnerships right away because, once done so, the partners and
members may become personally liable.
4. Close all joint accounts and resolve the finances

It's crucial to settle all debts after the partnership has ended and to terminate all bank and
credit accounts. There should be no open leases, credit cards, loans, or other financial
commitments if the business is no longer in operation.
If one partner is taking over the company, they will be in charge of opening any new accounts
in their sole name.
However, some partnerships might need to maintain open accounts. "If one member remains
in a limited liability company, the limited liability company may not need to be dissolved;
however, if the remaining individual operates a separate business, well-drafted Assignments
for intellectual property, etc., would likely be necessary, and that individual would need to
open new business accounts for the separate business," says DelMar. The dissolution
agreement can address account closure, she continues.
5. Communicate the change to clients
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Finally, let everyone know about the shift in the business—your clients, vendors, advisers,
and neighbors. Inform everyone if the ownership of the business has changed, it has been
sold, or it is closing(legalzoom,2023).
6. Differentiation between Legislation, Regulations, and Standards

6.1 Legislation
The foundation of any nation's legal system is its legislation. It includes laws passed by
legislative bodies like parliaments or congresses and is the main repository of the laws that
regulate society, including commercial activity. Generally speaking, legislation is extensive
and covers a wide range of topics in an effort to create a legal framework for various facets of
life, business, and governance..(britannica,n.d)
Compliance with pertinent laws is a crucial prerequisite for new businesses. To ensure
legitimate business practices and prevent legal repercussions, businesses must comprehend
and abide by the laws that are relevant to their industry and operations. Here are some
instances of how several areas of business are covered by legislation:
1. Employment Laws: Employment laws regulate how employers and employees

interact. It includes, among other things, hiring procedures, working conditions,
dismissal policies, wage standards, and employee rights. To guarantee that workers
are treated fairly, to avoid conflicts at work, and to reduce the danger of lawsuits
arising from labor disputes, start-up businesses must be knowledgeable about
employment regulations.
2. Company law: Also referred to as corporation law or business law, company law
governs the creation, administration, and dissolution of business enterprises. It
describes how to register a firm, what duties shareholders and directors have, and the
procedures for running a business. For start-ups to establish a legal organization,
safeguard shareholders' interests, and maintain accountability in their commercial
dealings, compliance with company law standards is crucial.
3. Environmental regulations: As people's knowledge of the environment increases,

environmental rules are becoming more crucial for businesses. Companies are
required by environmental rules to take steps to reduce their negative effects on the
environment, such as waste management, pollution control, and sustainable business
practices. To avoid penalties, legal ramifications, and reputational harm, start-up
businesses must comprehend and abide by environmental standards.
Businesses must abide by the law in order to conduct their operations; compliance is not a
choice. Legal penalties, fines, the loss of business licenses, and reputational harm can result
from failing to abide by the law. Other serious repercussions include reputational harm for
the offending corporation. Start-up businesses must seek legal counsel and keep abreast of
legislative changes that could have an impact on their operations.
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6.2 Regulations
Regulations are essential in converting general legal ideas laid out in law into precise,
implementable rules and obligations. In order to properly execute and enforce the legislative
framework, these regulations are made by regulatory or governmental entities. Regulations
cover the exact requirements and standards required for certain businesses, sectors, or
activities, as opposed to legislation, which may be more generic and abstract (Barak Orbach,
2016).
To ensure compliance with industry-specific criteria and to maintain legal and ethical
business practices, start-up businesses must comprehend and abide by all applicable rules.
Here are some instances of how rules relate to various business operations and industries:
1. Food Safety Rules: Organizations involved in the food sector, such as restaurants,
food producers, and grocery shops, are required to abide by food safety rules. To
make sure that food products are safe for customers, these regulations specify how
they should be handled, stored, prepared, and sold. For the purpose of preventing
foodborne illnesses, safeguarding the general public's health, and preserving
consumer trust in the brand, compliance with food safety rules is essential.
2. Financial Regulations: New financial businesses, including banks, credit unions, and
investment firms, are subject to the rules established by the banking and financial
sectors. These rules control several facets of financial operations, such as capital
needs, client safety, reporting obligations, and anti-money laundering safeguards. To
maintain the integrity and stability of the financial system and to safeguard the assets
of clients, compliance with financial regulations is essential.
3. Environmental Regulations: Environmental regulations apply to sectors including

manufacturing, construction, and energy generation that have a substantial
environmental impact. Environmental impact analyses, waste management, emissions
standards, and pollution control may all be covered by these legislation. For
businesses to show that they are environmentally conscious, reduce their ecological
impact, and protect the environment from harm, compliance with environmental
standards is essential.
6.3 Standards
Standards act as crucial barometers for defining expectations for quality, safety, and
performance across a range of industries. In order to create best practices and guarantee
consistency and dependability in goods, services, and procedures, standard-setting
organizations develop these standards, frequently in cooperation with stakeholders and
industry experts.
Standards are often voluntary in nature, in contrast to laws and regulations, which are legally
obligatory and have penalties for non-compliance. Their voluntariness does not, however,
35
lessen their importance for enterprises. In fact, start-up businesses can gain a number of
advantages and benefits from observing pertinent standards, including:
1. Improved Product Quality: Standards offer a foundation for guaranteeing dependable

and premium goods. Start-up businesses can enhance the dependability, usability, and
general performance of their products by embracing and adhering to pertinent
industry standards. As a result, customer happiness rises and brand loyalty grows.
2. Showing a Commitment to Safety and Ethics: Standards frequently take safety and
ethics into account, offering guidance for moral and sustainable corporate activities.
Following these guidelines shows a business's dedication to protecting the health and
safety of its clients, staff, and the environment, boosting its standing and credibility.
3. Increasing Consumer Trust: Consumers are becoming more aware of issues like
product quality, safety, and ethics. Customers are more inclined to purchase goods
and services from businesses that show adherence to accepted best practices and
safety requirements, thus adhering to industry standards can help you gain their trust.
4. Facilitating Market Access: In some industries, access to the market or participation

in government contracts may be contingent upon compliance with particular criteria.
Meeting pertinent standards can offer up new prospects and collaborations for start-up
businesses wishing to increase their market share or participate in public procurement.
5. Fostering Innovation Standards can encourage innovation and ongoing product and
service development. Start-up businesses can set themselves apart from rivals, draw in
new clients, and maintain a lead in their particular industries by embracing and
exceeding industry norms.
While many standards are optional, regulatory bodies may set mandatory requirements in
some industries for particular goods or services. In these circumstances, adherence to such
mandated criteria becomes enforceable and legally binding.
7. Conclusion
The need of legal compliance for new start-up businesses is emphasized in the handbook's
concluding section. It underlines the fact that for businesses to succeed and be sustainable
over the long run, they must comprehend and abide by the legal framework.
The conclusion underlines the importance of legal compliance for start-up businesses because
failure to comply can have serious repercussions, including legal liabilities, financial
penalties, reputational damage, and lost commercial possibilities. It supports the idea that
receiving legal advice and direction is essential for navigating the complicated legal
environment and making sure one is in compliance with all relevant laws, rules, and
standards.
The conclusion also emphasizes how the legal system is changing and how important it is for
businesses to stay current on changes and advancements. It encourages new businesses to
stay watchful and proactive in adjusting to changing societal standards, industry-specific
rules, and legal obligations.
36
The manual emphasizes that legal compliance should be viewed as a crucial component of
corporate strategy and decision-making in its conclusion. Start-up businesses can reduce legal
risks, safeguard their interests, and lay a strong platform for expansion by integrating legal
issues into their operations.
In conclusion, the guidebook acts as a thorough guide for new businesses, giving them a clear
understanding of the legal system and important laws pertinent to their operations. It
emphasizes the government's involvement in enacting laws, assesses the potential effects of
corporate, contract, and employment law on enterprises, and makes a distinction between
laws, regulations, and standards. It also assesses the efficiency of the legal system in light of
recent changes and advancements and offers case studies and examples to highlight the real-
world applications. The handbook's main message is that in order for businesses to succeed in
the long run, they must comply with the law, seek legal counsel, and adjust to the changing
legal landscape.
37
SECTION B
Appendix
38
Slide 1
Introduction:
Good afternoon, ladies and gentlemen. Thank you for having me here today as a guest speaker at the Small
Business Expo conference in Sri Lanka. My name is Mohammed MGM and I am a paralegal specializing in
business law. Today, I will be presenting an introduction to the different types and classification of business
organizations in both the public and private sectors, with a focus on Sri Lankan companies. I will also discuss
how these organizations are legally formed, managed, and funded, while highlighting the advantages and
disadvantages associated with each type.
39
Slide 2
Slide 3 Business organizations can take many different legal forms, each with its own
advantages and disadvantages. The 2 sectors of business organizations in Sri lanka are the
private sector and the public sector which is then broken into different types. Which we’ll
discuss further
40
Slide 4 A public-sector firm is one over which the State can directly or indirectly exercise
dominant control over ownership or shareholding, either because it possesses the majority of
the capital or the majority of the voting rights attached to its shares.
41
GOVERNMENT COMPANY
A specific category of public sector business that is registered under the Companies Act is a
government company. It conducts business operations and engages in commercial endeavors.
In order to be formed, a company must be registered, have a board of directors, and adhere to
the norms of corporate reporting.
Example - National Water Supply and Drainage Board (NWS&DB).
PUBLIC CORPORATIONS
Public corporations, also known as statutory corporations or government-owned corporations,
are autonomous legal entities established by the government to carry out certain tasks or
conduct business on the government's behalf. Enacting a law outlining the organization's
goals, duties, structure of governance, and authority is a necessary step in the creation
process. The corporation, which has financial autonomy and may report to the government on
occasion while abiding by government regulations, is governed by a board of directors.
Example- Sri Lanka Telecom
Private sector businesses are those that are not governed by the government. They are a
component of a nation's economic system and are operated by people and businesses with the
goal of making a profit.
42
SOLE-TRADER
THE SIMPLEST KIND OF BUSINESS ORGANIZATION IS A SOLE
PROPRIETORSHIP, WHICH HAS JUST ONE OWNER AND ONLY ONE EMPLOYEE.
A SOLE PROPRIETORSHIP CAN BE ESTABLISHED WITH NO FORMAL LEGAL
REQUIREMENTS, BUT THE OWNER IS STILL RESPONSIBLE FOR OBTAINING ALL
NECESSARY LICENSES AND PERMITS. BEING PERSONALLY LIABLE FOR ALL
OF THE COMPANY'S DEBTS AND LIABILITIES CAN BE A DRAWBACK.
eg ;Any local roadside shop
PARTNERSHIP
WHEN TWO OR MORE PEOPLE DECIDE TO JOINTLY OWN AND RUN A FIRM, A
PARTNERSHIP IS CREATED. ALTHOUGH INFORMAL PARTNERSHIPS ARE
POSSIBLE, IT IS ADVISED TO HAVE A WRITTEN PARTNERSHIP AGREEMENT
OUTLINING THE RELATIONSHIP'S PARAMETERS. ADDITIONALLY,
PARTNERSHIPS ARE PERSONALLY RESPONSIBLE FOR THE OBLIGATIONS AND
LIABILITIES OF THE COMPANY.
eg; MGM Distributors & Co
43
LIMITED LIABILLITY COMPANY
A RELATIVELY NEW TYPE OF BUSINESS STRUCTURE CALLED AN LLC
COMBINES THE ADVANTAGES OF A CORPORATION WITH A PARTNERSHIP.
ARTICLES OF ORGANIZATION MUST BE SUBMITTED TO THE STATE
GOVERNMENT, AND AN OPERATING AGREEMENT MUST BE WRITTEN
OUTLINING THE LLC'S RULES AND REGULATIONS. AN IMPORTANT BENEFIT OF
AN LLC IS THAT ITS OWNERS, KNOWN AS MEMBERS, ARE ONLY PARTIALLY
RESPONSIBLE FOR THE DEBTS AND OBLIGATIONS OF THE COMPANY.
eg; John Keels Holdings PLC
CORPORATION
IN TERMS OF THE LAW, CORPORATIONS ARE DISTINCT FROM THE
SHAREHOLDERS WHO OWN THEM. THEY ARE ESTABLISHED BY SUBMITTING
ARTICLES OF INCORPORATION TO THE STATE GOVERNMENT AND DRAFTING
BYLAWS THAT SPECIFY THE CORPORATION'S RULES AND REGULATIONS. AN
IMPORTANT BENEFIT IS THAT SHAREHOLDERS ONLY BEAR A SMALL PORTION
OF THE CORPORATION'S OBLIGATIONS AND LIABILITIES. CORPORATIONS
MUST HOLD YEARLY MEETINGS AND FILE ANNUAL REPORTS, AMONG OTHER
MORE COMPLICATED LEGAL DUTIES.
44
GOVERNMENT COMPANY
Managed
The Board of Directors, which oversees the corporation and its operations, is chosen by the
government. Additionally, much like any other public limited company, a government
company is subject to the 2013 Companies Act's management regulations.
Funded
A government-owned corporation receives funding from both public and private
shareholdings. The capital market is another source of funding for the business.
PUBLIC COORPORATIONS'
Managed
The daily operations of public firms are overseen by an experienced senior management
team. They oversee resource management and are responsible for the company's
performance.
Funded
Public corporations earn money by engaging in commercial operations like the sale of goods
or services. This income is utilized to maintain the corporation's financial sustainability by
paying for investments and operating costs.
45
SOLE TRADER
MANAGED
A sole trader is a particular type of business organization where one person controls and
directs the entire enterprise. He makes all the decisions regarding the business such as HR
finance Marketing etc
FUNDED
Usually, the individual proprietor who owns the business will provide the funding. To start
the business, they could borrow money from friends and family or use their savings.
PARTNERSHIP
MANAGED
All partners have the ability to manage the partnership because they all have the same
management rights. Technically speaking, partnerships are legitimate commercial entities
with two or more partners who divide managerial responsibilities and earnings.
FUNDED
Partners finance the bruisedness using their own money and assets therefore an ownership
stake in the partnership is exchanged for the value of the assets that were brought into the
partnership.
46
LIMITED LIABILLITY COMAPNY
MANAGED
Either members or managers may manage an LLC. In an LLC that is administered by its
members, each member has the power to act on behalf of the business. In an LLC that is
managed by managers, the managers are chosen by the members and are in charge of running
the business.
FUNDED
The sort of business, its financial requirements, and the owner's financial status are just a few
of the variables that influence the best strategy to fund an LLC. Personal finances, company
loans, crowdfunding, investor investment, and grants are a few typical sources of funding for
an LLC.
47
GOVERNMENT COMPANY
Pros
Discipline
The Government Company is governed by the Companies Act's regulations, which keeps its
management engaged, vigilant, and disciplined.
Cons
Government-appointed directors who are the government's "yes men" sit on the board of
directors of a government-owned corporation (the government is the largest stakeholder).
They are unable to manage the firm in a professional manner.
Public corporations, also known as state-owned enterprises (SOEs) or government-owned

corporations, are business entities that are wholly or partially owned by the government.
These entities can operate in various sectors, ranging from utilities (e.g., electricity, water) to
transportation (e.g., railways, airlines) and even manufacturing and finance. As with any
organizational structure, public corporations have their share of advantages and
disadvantages.
Pros of Public Corporations:
1. Economies of Scale: Public corporations often benefit from economies of scale. Due to
their significant size and scope of operations, they can produce goods or provide services at a
lower average cost compared to smaller private companies. This advantage arises from bulk
purchasing, centralized production, and the ability to spread fixed costs over a larger output.
Economies of scale enable public corporations to offer goods and services at competitive
prices, which can be beneficial for consumers.
48
2. Easier Planning and Coordination: As government-owned entities, public corporations
have access to a vast pool of resources, including financial, human, and technological. This
allows for better planning and coordination of projects and initiatives. Public corporations
can undertake long-term projects and investments with less concern about immediate
profitability, focusing on fulfilling broader public objectives.
Cons of Public Corporations:
1. Difficult to Manage: Public corporations often face challenges related to management and
decision-making. Due to their size and bureaucratic nature, decision-making processes can be
slow and cumbersome. Bureaucracy may hinder innovation and responsiveness to market
changes, leading to inefficiencies in operations.
2. Risk of Producing Inefficient Products: As public corporations are not solely driven by
profit motives, there is a risk that they may produce goods or provide services that are not
economically efficient. Some public corporations may prioritize social or political objectives
over profit maximization, leading to the production of goods or services that are not in high
demand or economically viable. This can result in financial losses and a misallocation of
resources.
Pros of Sole Trader:
1. Owner Keeps All Profits: One of the most significant advantages of being a sole trader is
that the owner gets to keep all the profits generated by the business. Since there are no
49
partners or shareholders to share the profits with, the sole trader enjoys full financial rewards
for their hard work and entrepreneurial efforts.
2. Makes All Decisions: As the sole proprietor, the owner has the freedom to make all
business decisions independently. This autonomy allows for quick decision-making without
the need for consultations or approvals from others. It enables the sole trader to respond
promptly to market changes and tailor the business strategy according to their vision and
goals.
Cons of Sole Trader:
1. Owner Bears All Losses: While the sole trader enjoys the full profits, they also bear the
entire burden of losses. If the business faces financial difficulties or legal liabilities, the
owner's personal assets may be at risk. This unlimited liability is a significant drawback and
can be a considerable source of stress and financial risk for the sole trader.
2. Decision Making Can Be Stressful: The sole trader is solely responsible for all aspects of
the business, including decision-making. While autonomy can be empowering, it also means
that the owner must deal with the pressure and stress of making critical business decisions.
This can be overwhelming, especially when facing challenging situations or uncertainty.
Pros of Partnership:
More Expertise and Skill: One of the significant advantages of a partnership is the pooling of
expertise and skills from multiple partners. Each partner brings their unique knowledge,
experience, and capabilities to the table. This diversity of expertise can lead to better
decision-making, problem-solving, and a more comprehensive approach to running the
business.
More Cash and Cost Savings: Partnerships often have access to more capital compared to
sole proprietorships since multiple partners contribute financially to the business. This
increased capital base can be used for business expansion, investment in new opportunities,
or handling unexpected expenses. Additionally, partners can share the costs and
responsibilities, leading to potential cost savings in various areas of operation.
Wider Range of Opportunities: With multiple partners, a partnership can pursue a broader
range of opportunities. Each partner may have their network of contacts and connections,
which can open doors to new markets, clients, or suppliers. This increased reach can help the
business grow and diversify its operations more effectively.
Shared Burden: Running a business can be demanding and comes with its share of challenges
and responsibilities. In a partnership, the burden is shared among the partners. This means
that no single individual has to bear the full weight of the business's success or failure.
Sharing the workload can reduce stress and allow partners to focus on their areas of expertise.
50
Cons of Partnership:
You'll Have to Split the Profits: One of the primary downsides of a partnership is that the
profits must be shared among the partners according to the agreed-upon profit-sharing ratio.
This means that each partner may receive a smaller share of the profits compared to running a
business individually. Profit-sharing can sometimes lead to dissatisfaction if partners feel
their contributions are not adequately recognized.
Disagreements Could Arise: Partnerships are based on mutual understanding and agreement
between the partners. However, differences in opinions, business strategies, or financial goals
can lead to disagreements among partners. Disputes can disrupt the harmony within the
business and hinder decision-making, potentially impacting the overall success of the
partnership.

Pros
An LLC offers its owners minimal personal accountability for the debts and obligations of the
company, which is one of its main benefits. This implies that the business owner's personal
assets are safeguarded in the event that the LLC gets sued or accrues debts. Contrary to a sole
proprietorship or partnership, where the owners' private assets are at stake, this is not the
case.
Cons
Lack of flexibility
An LLC may not be as adaptable as a sole proprietorship or partnership, which is another
possible drawback. For instance, you are required to have a documented LLC operating
51
agreement with this company entity that spells out the obligations and rights of the members.
This may be too rigid for some companies.
Pros of Corporation:
Personal Liability Protection: One of the most significant advantages of a corporation is that
it provides personal liability protection to its shareholders. In a corporation, the shareholders'
liability is generally limited to the amount they have invested in the company. Their personal
assets are shielded from the business's debts and legal obligations. This feature is especially
attractive to individuals seeking to protect their personal wealth and assets.
Business Security and Continuity: A corporation's existence is not dependent on its owners or
shareholders. It has perpetual succession, which means that the death or departure of a
shareholder does not affect the corporation's continuity. This stability ensures that the
corporation can carry on its operations, contracts, and relationships with minimal disruption,
providing long-term security for investors and employees.
Easier Access to Financing: Corporations often find it easier to raise capital compared to
other forms of business entities. They can issue various types of securities, such as stocks and
bonds, to attract investment from the public and institutional investors. Additionally, creditors
may be more willing to extend credit to a corporation due to its separate legal entity status
and limited liability protection.
Cons of Corporation:
Time-Consuming: The process of setting up a corporation and complying with legal

requirements can be time-consuming and complex. Incorporation involves filing the
necessary documents, drafting corporate bylaws, and adhering to various formalities
mandated by the state or country of incorporation. Maintaining corporate records and holding
regular meetings can also add administrative burdens.
Double Taxation: One of the significant drawbacks of a corporation is the potential for
double taxation. Corporate profits are subject to corporate income tax, and when dividends
are distributed to shareholders, those dividends are also subject to individual income tax. This
can result in a higher overall tax burden compared to other business structures, such as pass-
through entities like partnerships or sole proprietorships.
Formalities and Regulations: Corporations are subject to a range of regulatory requirements

and corporate governance standards. They must adhere to rules set forth by government
authorities and stock exchanges if publicly traded. These regulations include financial
reporting, disclosure requirements, shareholder meetings, and compliance with corporate
laws. Failure to comply with these regulations can lead to legal issues and penalties.
52
SOLE TRADER
Choose a business name, register it as your DBA, purchase and register a domain name, and
so on.
Register for an EIN.
Get a business license and all necessary permits.
Purchase business insurance.
Make a business bank account available.
Start operating
PARTNERSHIPS
Pick your partners carefully.
Choose the right sort of collaboration.
Create a name for your business partnership.
Publish the cooperation.
Identify your tax requirements.
Apply for a tax ID number and an EIN.
A cooperation agreement should be established.
Obtain any necessary licenses and permits.
Open a bank account for your company.
Select a financial choice.
Start operating
53
• Choose a name that is accessible and is legal for your LLC.
• Create and send the necessary state agency the Articles of Organization.
• Pay the required filing costs.
• Draft an Operating Agreement describing the obligations, privileges, and
financial arrangements of the LLC members.
• Acquire any necessary licenses or permits.
• Launch the LLC's operations
CORPORATION
• 1. Choose a corporate name that is legally permissible and not already in use.
• 2. Submit the required documents, known as Articles of Incorporation or Certificates
of Incorporation, to the appropriate government agency.
• 3. Pay the necessary filing fees.
• 4. Create corporate bylaws that outline the corporation's internal rules and procedures,
such as shareholder rights, board structure, and officer roles.
• 5. Call an organizational meeting of the initial directors to adopt bylaws, elect
officers, and discuss any other issues that arise
• 6. Obtain any permits or licenses required.
• 7. Commence the business
54
These are the references
ANY QUESTIONS?
55
THANK YOU
56
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[Online]. Available at:
https://legaljobs.io/blog/what-is-common-law/#:~:text=Common%20law%20is
%20based%20on,copyright%2C%20and%20common%20law%20marriage.
Question 01 : (Section - 01) : Apply and justify a legal solution to each problem presented in each case study.
CASE STUDY 1
THE LEGAL/BUSINESS PROBLEM

The legal issue in this case study is that Mr. William's company has set up a self-service
system for selling medications and non-prescription products, many of which are classified in
the Pharmacy and Poisons Act of 1972's Poisons List. Since the selling of these types of
drugs requires the supervision of a registered pharmacist, the Pharmaceutical Society of UK
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states that this new method of sale may violate the Act. This is an example of tort of
negligence by both sides, since Mr. William has implemented a self-checkout system so
consumers pick the item from the open shelf and buy it themselves however the consumers
have to be careful of the items they pick.
THE LEGAL/BUSINESS SOLUTION
If the legal expert determines that the self-service system implemented by Mr. William's
company is in violation of the Pharmacy and Poisons Act 1972, a modification in the sales
process is necessary to bring it into compliance with the law. One reasonable option is to
have a registered pharmacist present in the self-service area to supervise customers' selections
and provide guidance as needed.
Having a registered pharmacist on-site serves 2 important purposes:
1. Adherence to Legal Requirements: Under the Pharmacy and Poisons Act of 1972, the
sale of some prescription drugs and over-the-counter items on the Poisons List must
be overseen by a registered pharmacist. The business ensures adherence to this
regulatory obligation by having a pharmacist present during the self-service
procedure.
2. Expert Advice and Customer support: A licensed pharmacist has received training in
medicine and is qualified to provide clients with expert advice and support. They can
respond to inquiries, give advice on dose, reveal any drug interactions or allergies,
and assist clients in making well-informed purchase decisions.
JUSTIFICATION OF THE LEGAL SOLUTION
The following justifies the legal and practical solution of having a registered pharmacist
present in the self-service area to monitor clients' choices and offer assistance:
Any business activity must adhere to the law, but this is especially important in sectors where
public health and safety are at risk, including the selling of drugs and poisons. The Pharmacy
and Poisons Act of 1972, in this situation, establishes particular guidelines that must be
adhered to while selling some prescription medications and over-the-counter goods that are
listed on the Poisons List. According to the law, these products must be distributed directly
under a licensed pharmacist's supervision.
Mr. William's business exhibits a strong commitment to observing the Pharmacy and Poisons
Act 1972 by putting into practice the legal/commercial solution of having a certified
pharmacist present in the self-service area to oversee customers' selections. This commitment
to legal compliance exemplifies ethical corporate behavior and guarantees that the
organization operates within the bounds of the law.
The penalties of breaking the Act could be disastrous for Mr. William's company. Financial
penalties, operational suspensions, and other legal implications are all possible. Non-
compliance could also damage the company's brand and cause clients, suppliers, and other
stakeholders to lose faith in it. Additionally, it could lead to bad press, which might hurt the
company's brand image and market position.
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On the other hand, abiding by the law indicates a dedication to customer care and safety in
addition to helping prevent potential legal repercussions. The presence of a licensed
pharmacist on the premises guarantees that clients have access to knowledgeable advice. The
pharmacist can answer client concerns and provide reliable information to assist consumers in
making decisions regarding their drugs, potential drug interactions, or adverse effects.
CASE STUDY 1

In this case study, a breach of contract is the legal issue. In order to supply 500 speaker
systems and image tubes for a batch of smart televisions, Moses PLC and Mr. David reached
an agreement. According to the contract, the components must be delivered by September 15,
2021. Moses PLC's manufacturing was delayed since Mr. David was unable to provide the
parts on time and could only do so on September 28. Due to the failure of Moses PLC to
complete the order from one of its major clients, Vision PLC, the latter company announced
its intention to stop doing business with Moses PLC.
Reviewing the contract is a crucial first step for Moses PLC in addressing the agreement
violation with Mr. David. Moses PLC can make sure they understand their rights and
responsibilities under the contract by carefully reading it and becoming familiar with all of
the terms and conditions. Here's why taking this action is essential:
1. Identifying Obligations: The contract will detail the specific responsibilities and
obligations of each party. The delivery timetable, component quantity, quality, and
other important aspects that were agreed upon with Mr. David must be confirmed by
Moses PLC. This ensures that the contract's terms are clear and unambiguous.
2. Calculating Penalties for Delays: The contract may include provisions addressing
fines or other remedies in the event of a violation, such as liquidated damages or
reimbursement for losses brought on by the delay. Understanding these penalty
provisions enables Moses PLC to determine the extent of the damages suffered and
the appropriate strategy for pursuing compensation.
JUSTIFICATION OF THE LEGAL SOLUTION
Moses PLC has carefully read the contract and is fully aware of their obligations and rights
under the agreement with Mr. David. The following are some reasons why this information is
crucial:
1. Finding Particular Tasks: Moses PLC can determine the precise obligations and
responsibilities they have promised to accomplish by scrutinizing the contract. The
delivery schedule, quantity, quality, and other crucial terms that were mutually agreed
upon with Mr. David are included in this. Moses PLC will be aware of what is
expected of them throughout the term of the contract thanks to this clarity.
2. Ensuring Compliance: By being aware of what is expected of them, Moses PLC may
make sure that the conditions of the agreement are being met. They are able to prevent
unintended violations as a result, and the company relationship is maintained in good
61
standing. Contractual duties that are not met may give rise to litigation and other
problems.
3. Equally crucial is Moses PLC's knowledge of their legal rights as outlined in the
contract. Moses PLC can determine the safeguards and rights to which they are
entitled under the agreement by thoroughly reading and comprehending the terms of
the contract. This gives them the ability to demand Mr. David's compliance when
necessary and assert their rights.

Case Study 03:
The legal issue in this case study is racial and sexual employment discrimination. Employees
of Yorkshire Retailers Ltd.'s Northern Food Division who are female and Black claim that
their employer has engaged in discriminatory practices in a number of areas of employment,
including hiring, scheduling shifts, converting part-time workers to full-time positions, and
promotions. The disgruntled workers allege that there have been numerous instances of
discrimination, with the most recent one involving promotions being given to white male
employees who had only been with the company for seven months, while more seasoned
employees who had worked there for longer periods of time were passed over. These
accusations are rejected by the store manager, who calls them untrue and unfounded.
Gathering witnesses and evidence is a crucial step for the dissatisfied employees in
addressing their claims of racial and sexual employment discrimination. This process
involves identifying individuals who can provide firsthand accounts of the discriminatory
incidents and collecting relevant documentation that supports their case. Here's why this step
is essential:
Credibility and Corroboration: Witnesses can provide credibility to the employees' claims by
providing firsthand accounts of the discriminatory actions they have witnessed or
experienced. Corroborating testimonies from multiple witnesses strengthen the validity of the
allegations and enhance the employees' position when presenting their case.
Objectivity and Impartiality: Witnesses can offer an objective perspective on the incidents,
free from any personal bias or interest. Their unbiased accounts can provide a more accurate
representation of what transpired, helping to build a compelling case against the employer.
Question 02 : (Section - 02) : Compare and contrast different sources of legal advice for two
or three chosen business problems.
Mr. William and Moses PLC can look to a variety of legal sources for counsel when dealing
with the business issues covered in Case Studies 01 and 02. Here are several sources in
comparison and contrast:
1. In-House Legal Counsel:
62
Comparatively, Moses PLC and Mr. William's Shop both can have in-house legal counsel as
a component of their respective businesses. The benefit of having in-house legal counsel is
that they have a thorough understanding of the business's procedures, rules, and agreements.
They can easily offer legal guidance tailored to the business' needs, goals, and industry
regulations.
In contrast, while inexpensive and easily accessible, in-house counsel may have drawbacks in
some highly specialized areas of law. They might lack in-depth knowledge of certain legal
topics, such as the subtleties of the Pharmacy and Poisons Act of 1972 in Case Study 01 or
contract law and issues relating to breach of contract in Case Study 02, to name a couple.
They might need to seek outside legal counsel in difficult legal problems.
2. External Law Firms:

Comparatively, both Case Studies 01 and 02 might profit from consulting outside legal
counsel. Typically, law firms employ a varied group of attorneys with expertise in a range of
legal disciplines. They may offer thorough and expert legal counsel catered to the particular
legal issues Mr. William's shop and Moses PLC are facing.
Contrast: Compared to in-house legal advice, engaging outside law firms may be more
expensive. Before obtaining outside legal counsel, businesses must take into account their
financial situation and the difficulty of the legal difficulties. Additionally, it could take more
time to comprehend the background of the case because outside law firms might not be as
well-versed in the business' operations and procedures.
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