Introduction to Business Law Unit 1 Bcom Final year GFGC GBD

 

                                                                Introduction to Business Law

 The law affects every aspect of our lives; it governs our conduct from the cradle to the grave and its influence even extends from before our birth to after our death. 

Law is essential to any society in that it provides the rules by which people and businesses interact. Law affects almost every function and area of business. 

                                                                    What is Law? 

 The law is a set of rules, enforceable by the courts, which regulate the government of the state and govern the relationship between the state and its citizens and between one citizen and another. OR Rules made by authority for the proper regulation of a community or society, or for correct conduct in life. 

Nature of Law

 ¶ Law is, at one and the same time, essentially authoritative and essentially ideal.

 ¶ Law necessarily comprises both a real or factual and an ideal or critical dimension.

 ¶ A central element of its ideal dimension is a claim to correctness, which includes a claim to moral correctness.

 ¶ A central element of the real dimension of law is coercion or force. 

 "Ignorance of law excuses no one", this is a legal principle holding that a person who is unaware of a law may not escape liability for violating that law merely because one was unaware of its content. The Constitution of India is the supreme law of India. It is the longest written constitution of any sovereign country in the world. It came into effect on 26 January 1950. 

Business law encompasses all of the laws that dictate how to form and run a business. This includes all of the laws that govern how to start, buy, manage and close or sell any type of business. Business laws establish the rules that all businesses should follow

Characteristics of Business law

 • Defining general rules of commerce; 

• Protecting business ideas and business assets;

 • Providing mechanisms that allow business people to determine how they will participate in business ventures and how much risk they will bear;

 • Ensuring that losses are borne by those responsible for causing them; 

and • Facilitating planning by ensuring that commitments are honoured.  

Sources of Business law

 Customs of History(Trade) 

Mercantile Law Principles of Equity

 Law of Merchants 

British Statutory law 

Indian Statutory law

The main sources of business law in India are:

 Statutory Law: 

Legislation or statutory is the most important source of law. Legislation is the making of law. But when we use the term legislation as a source of law, we mean law making by statutory authority. Both parliament and stat assemblies have enacted a number of legislation that cover various aspect of business. In England, a distinction is made between statute law or written law and the common law. Only the former is called legislation. In India, there is no common law. Here legislation or enacted law is different from customary or personal law. 

English Mercantile Law: 

The English mercantile law constitutes the foundation on which the super structure of the Indian mercantile law has been built. Our sales of goods Act, for instance has been taken from the English sales of goods of Act. Even now, despite the enactment of various statutes relating to matter falling with the purview of the mercantile law, our courts generally takes recourse to the English law where some principles are not expressly dealt within the Act, or where there is ambiguity.

 Case Law: 

case law, popularly called precedent by lawyers is a judgment of a superior court including a point of principle and which necessitates its adoption and adherence in a subsequent case involving the same point. case law is useful in as much as it helps courts to render uniformity with regard to the interpretation of statutes. 

The past judicial decisions of courts are important source of law. 

Sometimes there is no statutory provisions which can answer a legal question raised in a law suit. In such cases, the court will look into previous court decision on similar matters to find the relevant law. Even when a statute is capable of answering a legal question, the court may refer the precedents to see how the statutory provision where applied in similar circumstances. The precedents set by the high courts have a binding force on lower courts. And the precedents set by the courts of same status like high courts of different states have persuasive value for each other. In India, the supreme court is the highest court and its decisions have binding force on all the courts subordinates to it, i.e., on high court, district court and other subordinate courts. 

Precedents (past judicial decisions):

 In common law legal systems, a precedent or authority is a legal case that establishes a principle or rule. This principle or rule is then used by the court or other judicial bodies use when deciding later cases with similar issues or facts. 

Indian statue law: 

Statutory law or statute law is written law set down by a body of legislature or by a singular legislator (in the case of absolute monarchy). This is as opposed to oral or customary law; or regulatory law promulgated by the executive or common law of the judiciary. Statutes may originate with national, state legislatures or local municipalities. 

 Mercantile law is also known as “Lex Mercatoria”,it is the Latin expression for a body of trading principles used by merchants throughout Europe in the medieval. Literally, it means “merchant law". It evolved as a system of custom and practice, which was enforced through a system of merchant courts along the main trade routes.