14. Legal Requirements when Establishing a Business Enterprise

This chapter studies the various forms of business organization that are available to those who trade. It focuses on the types of trading structures available, how they are established, and provides an overview of the implications of each form of business organization. It should be noted that there is no one model that will suit every individual or every business model. It is very much the decision of the individual—having assessed the business, what they wish to do with it, and how they see it continuing in the future—to determine the form of enterprise chosen. Being aware of the consequences for the business organization is crucial in making this decision.

12. Non-Physical Damage and Liability for Economic Loss

This chapter continues on from the previous chapter in discussing liability in negligence for physical damage and considers the potential liability that businesses and individuals may face when they provide advice in the nature of their business, when they cause economic losses not associated with physical damage, and where the claimant suffers a psychiatric injury or nervous shock due to the acts of the tortfeasor. Recently, there has been an increase in instances of imposing liability on employers for the stress and associated health problems suffered by their employees. In the absence of physical damage, restrictions are placed on the imposition of liability for pure economic loss, although such loss has been widened to include damages for negligent misstatements. Of crucial importance is that businesses are aware of the implications of providing information in the course of their professional activities that may cause an investor or client loss through negligence.

11. The Tortious Liability of Businesses in Negligence and Nuisance

This chapter first discusses one of the most important torts—negligence—which may be commonly seen in instances of personal injury. This is followed by a discussion on acts of private and public nuisance. Torts law is particularly relevant to businesses as they need to be aware of the extent of their potential liabilities to workers, visitors to business premises, other businesses, and to the general public. This extends to ensuring that safe systems of work exist and appropriate insurance is maintained. Contrary to civil law, torts law imposes obligations on parties who wish to undertake duties freely and agree to be legally bound via contracts without, necessarily, prior agreement. The duty is to take reasonable care and not intentionally or negligently cause harm or damage.

8. Terms of a Contract

This chapter focuses on the terms or details of a contractual agreement, and considers the implications of what the parties intend to include in the agreement, what they did not mean to be included in the contract, and what significance different terms may have in the contract. It distinguishes between the terms of a contract and representations, and considers whether, when a term has been identified as such, it is a ‘condition’ or a ‘warranty’. The chapter then studies how terms are implied into the contract and how this affects terms that have been expressed. It concludes by examining how parties may seek to exclude or limit a legal responsibility through the incorporation of an exclusion clause.

2. The English Legal system, Constitution, and Human Rights

This chapter, in discussing the English legal system and its features, begins by outlining what the law is and some important constitutional principles. The discussion is primarily based on the institutions and personnel involved in the practice and administration of justice. It therefore involves a description and evaluation of the courts, tribunals, and the judiciary, including their powers and the rationale for such authority, as well as the mechanisms of control and accountability. The aim of this chapter is to demonstrate how the mechanisms of the justice system work. The English legal system exists to determine the institutions and bodies that create and administer a just system of law. It should be noted here that the UK does, in fact, possess a written constitution, it is merely uncodified.

22. Equality In Employment Relationships

This chapter discusses the Equality Act (EA) 2010. There have been many changes adopted following the enactment of this legislation. The Act is relevant for businesses as it imposes obligations to provide a safe system of work, including regulating the activities of management, colleagues, and third parties. This is an area of law that will evolve over the forthcoming years, and whilst much of the previous case law is applicable to this new Act, new judgments will likely expand and clarify the extent of equality law. An employer who is not aware of the provisions of EA 2010 runs the risk of facing very expensive claims, poor industrial relations, and potential damage to his or her reputation as an employer.

7. Factors Affecting The Validity of a Contract

This chapter discusses how the manner in which a contract is concluded can potentially affect its validity. Before discussing the terms and details of a contract, it is important to note that a contract may fail due to one or both parties not possessing the capacity to establish a contract. Some of the common reasons includes a mistake by one or both parties, a provision that has been misrepresented in the negotiations, or the use of undue influence or placing the other party under duress in the process of concluding the contract. Some of the reasons listed in this chapter may be common, but the emphasis here is to identify where problems may occur that could prevent the successful operation of the contract despite fulfilling the essential features discussed in the previous chapters.

23. Statutory and Common Law Regulation of the Conditions of Employment

This chapter continues from the discussion of the obligations on employers to adhere to the Equality Act (EA) 2010 and protect their workers from discrimination and harassment, to a wider consideration of the regulation of conditions of employment. Legislation places many obligations on employers, and they are increasingly subject to statutory controls that provide for a minimum wage to be paid to workers, for regulation as to the maximum number of hours workers may be required to work, and for the protection of workers’ health and safety. In the event of an employer’s insolvency, the rights of employees are identified, and finally, the mechanisms for employers to protect their business interests in the contract of employment are considered.

5. Establishing an Agreement: Offer and Acceptance

This chapter identifies the essential features necessary in the establishment of a legally binding contract. Most contracts need not be given in writing, and a contract could be regarding as something as simple as buying a newspaper or a cup of coffee. In fact, many contracts that are established are not done so in writing, even if a receipt is received. However, each of the essential features noted in this chapter is present in forming those contracts. Before the essential features are considered, it is important to note that contracts can be established by the parties exchanging promises, or by one party promising to perform an act in return for some action by the other. In the latter scenario, the second party has no obligation to take any action unless it wishes to enter into a contract.

4. Dispute Resolution for Businesses

This chapter identifies courts and tribunals as the place where the laws discussed in the previous chapters are interpreted and utilized in the legal system. The jurisdiction of the courts and the personnel within them are described and a comparison is drawn between these forums for the administration of justice. It is important for those in business to be aware of the work of at least one tribunal—the Employment Tribunal, as many employment-related disputes ultimately end up here. Also, the courts in the English legal system, and the increasing use of alternative dispute resolution mechanisms, are relevant to businesses as they are used either to settle disputes or to avoid them altogether. Because the term ‘court’ is difficult to define in any practical sense, the chapter uses a description of what a court does.