Business Law

What is ‘Business Laws Business law consists of selected rules of law that are of particular relevance to business activities. For example, business law includes aspects of contract, tort law, criminal law, plus selected topics from other rotational divisions of law. Knowledge of business law is important because it enables a person to: 0 recognize the legal aspect of typical business situations and understand the legal rules involved 0 know the extent to which they can rely on legal rights and duties 0 know how to use the law constructively to achieve desired outcomes.

For example: o intolerance agreements Tort goods Ana services can De created; o property rights can be acquired and protected; o business organizations can be created; and o financial systems can be used. 3. Legal and non-legal rules Law consists of rules of conduct or organization that are recognized, applied and enforced by the power of the state. Non-legal rules are rules of conduct or organization that are enforced by things such as peer pressure, a need for co-operation, feelings of goodwill, or convenience. Of 2 Non-legal rules are derived from: 0 moral or philosophical beliefs; 0 religious beliefs; 0 social values; and 0 rules that have become customary in a community. Non-legal rules work well enough in smaller groups or communities but in larger groups they come inadequate. Law tends to emerge in all larger societies as a necessary means of regulating conduct. 4. Some important terms and phrases Legal ‘principles’ are statements of the broad fundamental viewpoints that set the policy and philosophical direction of an area of law. Legal rules’ are the more detailed mechanisms by which the principles are given effect. ‘Legal system’ means all the legal principles and rules that exist in a particular country. ‘Legal system’ also means all the additional things that contribute to the operation of law in society, that is: 0 mechanisms for creating and changing the law; 0 mechanisms for administering and enforcing the law; and 0 mechanisms for preserving and perpetuating the law. 5. Law and Justice In basic terms, legal rules are applied to specified facts in order to decide the outcome.

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In other words, the proper outcome or result of a case is deduced by applying the relevant rules of law to the proved facts. For example: Facts: Peter has been found guilty of serious theft. Rule: Anyone found guilty of serious theft must go to prison. Decision: Deciding questions in this way can be described as a strictly “legal” approach. The correct decision is normally presumed to result from the logical process. Generally, as well as being logical, legal decisions ought to be ‘Just’.

Justice can be thought of as involving at least two elements: 0 everybody should be treated in the same way unless there are significant differences in the circumstances; and 0 outcomes should not be unduly harsh. 3 of 3 Sometimes, the strictly logical application of rules needs to be adjusted to achieve a just outcome. In other cases, Justice may require recognizing additional facts as significant. For example: Facts: William has been found guilty of serious theft. Rule: Anyone Tuna guilty AT serious tenet must go to prison. Years old.

Decision: Revised Rule: The strictly logical application of existing rules promotes certainty and predictability. The fair and Just nature of decisions promotes respect and support for the law. These considerations must be balanced. Case study Law as a mechanism of organization and regulation Legal and non-legal issues In any given situation it is likely that there will be a variety of important issues. For example, in a sale transaction, there are often economic and practical issues as well as legal issues to take into account.

It is important to be able to analyses a situation, identify the legal issues and separate them from other issues. For example, in deciding whether to buy an item in a local shop or in an on-line auction, there may be financial issues (the cheapest price); practical issues (how to pay, delay in getting delivery); and legal issues (non-delivery, faulty goods, etc). Case study: The coffee shop Stella decides to open a coffee shop in Melbourne. Rather than operate as a sole trader, she registers a company as the owner of the business.

Acting on behalf of the company, Stella leases business premises, employs waiters, gets a loan from the bank and purchases equipment and supplies. She gets permission from the local council to put chairs, tables and umbrellas on the pavement outside the coffee shop. When she opens for business the following things happen: 0 Stella does not properly secure one of the umbrellas and a customer is injured when it blows over in a gust of wind. The customer demands compensation. 0 The espresso machine she bought to make coffee turns out to be defective. Stella wants to return it. A health inspector says that Stall’s kitchen is dirty. Stall’s company is prosecuted and fined $1,000. 4 of 4 John, who owns the shop next door to the coffee shop, claims that Stall’s tables are encroaching on his space but Stella ignores his protests. John is thinking of Just pushing the tables away each day. (a) Do you recall which aspects of this case that related to the following areas of law: Criminal law 0 Tort law 0 Contract law 0 Property law 0 Corporations law (b) How does the law allow Stella (or others in the case study) to do the following things: 0 Organize and plan with reasonable certainty. Lay down the rights, duties and powers of members of different classes and groups. 0 Permit, encourage, forbid or Electorates particular actively. U creates rulings Ana outlets Tanat can De entrance u Provides remedies when rights are interfered with or duties are not discharged. (c) Why is it important to know the law? Are people expected to know the law? 5 of 5

Business law

The fundamental attribute of corporate personality is that company is a legal entity distinct from the members. “Elucidate the statement . Also specify the Important features of a company. 2 . Discuss the essential elements of a valid contract. 4. What are the characteristics of negotiable Instrument? Discuss the ‘privileges’ of holder In due course as per the provisions of the Negotiable Instruments Act, 1881? Also state the Important amendment to be Incorporated under sec 138 of the act. 5. Elaborately explain the essential features of the consumer protection act 1986.

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Also briefly discuss unfair trade practice and restrictive trade practice as discussed under consumer protection Act? Read the case study given below and answer the questions given at the end Case Study Ditty Mass Communication Private Limited A. P. State Road Transport Corporation A. P. State Road Transport Corporation, Hydrated advertised tender notice on calling for tenders for display of advertisements on the buses owned by it. According to the condition of the Tender Notice, each tender form had to be accompanied by a emend draft for RSI 20 lash and tender forms completed in all respects had to be put in the tender box.

The accompanying sum of money was the Earnest Money Deposit (E. M. D). Clause (10) of the terms provided that the tender will be opened at 3:00 p. M. On October 31, 1996, in presence of the tenders or their authorized agents. Clause (14) provided that tenders will not be permitted to withdraw their tender after the tenders were opened -Clause (15) provided that if the highest tendered backs out from taking up the agency , for whatsoever reason, the E. M. D. Paid by him will be forfeited.

Ditty mass Communication Private Limited submitted its duly filled tender along with demand draft of RSI. 20 lash. In relation to this tender, another person approached the High Court and got an order restraining the Transport Corporation from proceeding further with the tender. Following the order, the A. P. State Road Transport Corporation opened the tender box at 3 p. M. And found six sealed covers. In view of the directions of the High Court, the covers were again placed back in the tender box without opening the seals.

The signature of the tenders and their agents was taken to this effect . The tenders were not opened to find out the highest bidder. Ditty Mass Communication Private Limited wrote a letter on November 1 1, 1996 stating that no reasons were given to him for non- opening of the tenders and that he could not keep the huge amount of RSI 20 lash locked In with all the uncertainty associated with the tender. It, thus, requested for return of the Earnest Money Deposit. A. P.

State Road Transport Corporation replied n November 14, 1996 that the Ditty Mass communication had signed on the note Thus, it could not put up the argument that no reasons for non-opening of the tender was given on it. The letter notified that the tenders would be opened on November 16, 1996 at 1 1 hrs. Ditty Mass Communication once again wrote a letter on November 15, 1996 that the question of their participation in the opening of tenders did not arise as they asked for the return of E. M. D. The A. P. State Road Transport Corporation went ahead with the opening of the tender, found Ditty Mass

Communication to be the highest bidder and awarded the tender to it. Ditty Mass Communication was informed of this but it demanded refund of Earnest Money Deposit. The A. P. State Road Transport Corporation following the terms of tender forfeited the earnest money deposit of Ditty Mass Communication. . Elaborately state the important legal issue’s covered under this case. What are the essential features of a tender? 2. Give your reasons in support of your decision for the issue discussed in this case. 3.