Introduction to Business Law - Essay Example

Introduction to Business Law Module MOD001028 Academic year: 13 ID number: 1025334 Abdulaziz AlHazzani Explain the golden rule, the mischief rule and the literal rule of statutory interpretation. Which must be applied first and why? Statutory interpretation is applied where uncertainty and complexity occurs as to the `` what the subsection or section gives’’ and to whom it applies, that is , is within the provisions. There are several cases where a judge may call for further interpretation of a statute for example; failure of the legislation to address certain points, drafting error, changes in usage of language and ambiguity. To cater for these instances several rules apply to statutory interpretation. These rules are: golden rule, mischief rule and literal rule. Golden Rule Golden Rule or British Rule of statutory interpretation gives authority to the judge to dismiss the literal meaning of a word in order to prevent passing an illogical ruling. Golden rule will qualify a literal rule in a case where the literal rule is not applied where doing so will lead o injustice. Golden rule is a compromise between the literal and the mischief rule (Zander, 2004). An example where this rule was applied was the Sigsworth, Re, Bedford vs Bedford. In this case, a son has murdered his mother who was yet to make a will. Under the Section 46 of the Administration of Estates Act 1925, there should be inheritor and in this case, the son was the sole issue therefore he should have inherited the mother’s property. However, the judge ruled under the golden rule and the son did not receive the inheritance. This is because it would have been illogical to give the inheritance to the son who had murdered his mother and would benefit by committing a crime (Hanson, 2010). Mischief Rule Mischief Rule of statutory interpretation gives authority to the judge to interpret the law by bearing in mind he common law before passing of the rule. Is is applied in cases where ambiguity occurs in the law. Thus this rule aims to understand the defect and also to provide solutions which would correct the situation if implemented. A popular case that came under the Mischief rule was Smith vs. Hughes. In this case, prostitutes were charged for recruiting clients from a public place while within the confines of a private area, which were the windows that overlooked into the street. Under the Street Offenses Act of 1959, it is illegal to attract clients with the intention of offering sex services on the streets. The defendants pleaded that they had not attracted clients on the streets but were within their own homes. However, the judge found them guilty since the prostitutes had mischief on their mind and were in fact taking clients from the streets (Mitchell and Dadhania, 2003). Literal Rule The literal Rule as the name suggests allows the judge to give out a ruling by taking into account the literal meaning of the word since they do not affect the ruling on the case. The judge in this case does not have to consider the meaning or the implications behind words or sentences such as in the case of the previous laws. This is usually the most preferred rule of statutory interpretation. An example of this is the R Vs Harris case under which the defendant harmed the victim by biting his nose. Since the law considers stabbing, cutting or wounding a person through an instrument as a crime, therefore the defendant was acquitted since he did not commit the crime in the literal sense (Caven, 2004). Application In normal circumstances, the literal rule is first applied before considering any other approach. This is the first rule the judges should consider in their interpretation. Under this rule words are given their ordinary meaning and judges apply them without seeking to apply gloss on them. When a different approach is taken, significant reason should be presented as to why the Golden or the Mischief rule had been applied (Caven, 2004). Conclusion For one to say that the three rules are lacking imperfections, Under the literal rule it is clear that its application of case law may cause unjust and absurd results. It is evident that from the Golden rule that , an interpretation of a word or phrase absurdity may affect the results of the case depending on the view of the judge. Lastly, mischief rule, it may not provide clear intentions of the person drafted it, therefore interfering with the remedy to be given even if it is easily applied to statutes. ‘After 45 years in litigation, I have seen so much money spent, stress caused and delay encountered. Reaching settlement at the door of the court is entirely unsatisfactory’. Sir Henry Brooke in ‘Mediation; Lawyers still need convincing’, Law Gazette (18th September 2008) Evaluate the statement in terms of ADR’s ability as a viable alternative to the court system. Alternative Dispute Resolution (ADR) 1. Definition of ADR. A.Types of ADR 2. Forms of ADR A. Mediation B. Negotiation C. Arbitration a. Binding arbitration. b. non-binding arbitration D. Collaborative law 3. ADR as a viable alternate to court system 4. Advantages and disadvantages of ADR Definition ADR is an acronym for Alternative Dispute Resolution. Under ADR, the dispute is resolved by allowing the conflicting parties to come to an agreement without having to go through the process of filing a case against the defendant. In this system, the dispute is resolved with or without the presence of a third party. With court cases increasing and the increasing manipulation of laws, ADR is being considered as a good solution by the legal professionals also. ADR allows the legal system to save costs that would otherwise be incurred by trying the case in court. ADR has gained acceptance to such an extent that courts are now considering first going through the process of ADR before actually trying the case in court. Types of ADR There are four basic types of ADR which include mediation, negotiation, arbitration and collaborative law. Mediation Under mediation, the dispute is resolved through a mediator who is the neutral third party that proposes a viable remedy of the crime committed. The acceptance of the remedy is a voluntary act on the part of both the concerned parties. Example of mediation is sister vs Bristol, the mediator in this case has 4 face to face conferences so that he may change the perception the parties has to each other. Negotiation Under negotiation, the conflicting parties bargain on the conflicts without the help of a third Party. Here also the parties participate in the process in a voluntary manner. Arbitration Under arbitration, a private judge is usually the third party who rules out the decision and imposes it on the concerned parties. Binding arbitration – it is conducted by a private arbitrator and it is carried outside the court. Non-binding arbitration- it is either ordered through the court or it may be carried out privately. If the decision made does not satisfy the parties, they are able to file a trial. Collaborative law Under collaborative law, both the concerned parties hire an attorney and it is the duty of the attorneys to reach an agreement regarding the conflict. Usually ADR is a voluntary action whereby both the conflicting parties wish to reach an agreement without having to resort to filing and fighting a case which would incur cost and time for both the parties. ADR as a viable alternate to court system ADR has gained so much popularity because of the criticism that the present court system receives. This criticism is summed by quite well by Sir Henry Brooke’s above quote that the present court system is weighed down by the increased court cases. Too much money is spent on court cases while also increasing stress for the related parties. Court cases take too much time in the resolution which further aggravates the condition. Considering this, ADR is being considered as a viable alternative to the court system. This is because ADR provides the following benefits. Advantages Probably the biggest advantage of ADR is that is lower costs as compared to a formal legal case. Both the legal professions and the common people are considering ADR more seriously and frequently because court cases imply increased costs for the conflicting parties as well as the government which eventually trickles down to the taxes paid by the common man. ADR also simplifies the conflict resolution that would otherwise be complicated when conflicting parties hire attorneys, file case and go through the burdening process of the proceedings. Also since the deal struck between the conflicting parties considers the situation of both the parties and allow them to directly deal with the process; therefore there is a better chance that both the parties will honestly comply with the settlement. This prevents further issues from arising. Since the agreement is reached without appearing in court, it also ensures confidentiality for both the parties. Media would not be involved and thus reducing the likelihood for embarrassment for one or both the parties (Lynch, 2001). Thus, ADR provides a solution for the issues that Sir Henry Brooke brought forward against the present court system. Disadvantages ADR may not be in favor of every dispute, also in a case where the ADR process is binding, the parties may be discouraged to trust court protection . ADR will always be ineffective if the parties have sufficient evidence in settling the dispute. Lastly, a fee may be charged by the neutral on his or her services. The law of contract and tort law are similar in nature and it is therefore difficult to distinguish between the two legal concepts. Analyze the statement and state whether you agree with this proposition. Law of Contract The law of contract deals with the agreement between two parties on the account that promise(s) made by one party to another. A contract is said to be in place when certain elements of the contract are in place. These include an offer by one party that is later accepted by the other party, resulting in a counter offer. This is then followed by developing a legal contract that takes into consideration the actions of both the parties in the contract. Law of Tort The law of tort as defined by Professor Winfeld is “Tortious liability arises from breach of a duty primarily fixed by law; this duty is towards persons generally and its breach is redressable by an action for unliquidated damages” (Harpwood, 2000). The above definition shows that Tort deals with misbehavior of a person that is against the law and result in another person’s suffering. It may not be illegal but it is a cause of harm for the victim. Tort can be classified into two types: intentional tort and negligence tort. Intentional tort is when a person knowing fully harms another while negligence tort occurs due to intentional harms on the part of the defendant. Tort law provides remedies for the damage suffered by the victim and these damages are usually monetary in terms. Differences between the two concepts Modern law of a great extent has blurred the boundaries between the two laws; however, there still exists a difference between the two concepts. Tort law deals specifically with harm committed by one person against the other. Prior to the harm, the parties may have had no interaction with each other and therefore were not bound by any contract as is in the case of a contract. In case of a contract, misdemeanor exists when one or both parties in the contract do not properly fulfill the obligations that they have to each other according to the terms of the contract. They may not be committing any illegal act, if we do not consider the terms of the contract. However, in the case of a tort, one party does commit an illegal act, for which they are punishable by law. The two concepts also differ in terms of the aim. Tort law aims to prevent any harmful behavior from any person, either intentionally or unintentionally. Contract law on the other hand, aims to bind two people in a contract to prevent them from the act of omission from the terms of the contract. 1b) In a local newspaper, Lester offered a reward of £500 to anyone who found and returned his dog, Rob, to Lester at his address. Mandy found the dog at the bottom of her garden. She fed and looked after the dog for four days. Then, she was told by a friend, Oliver that there was a reward on offer for a dog matching the description of the one found. Mandy, having consulted the local paper, telephoned Lester and left a message on Lester’s telephone answering machine saying that she had Rob and would return him. Rob escaped while M was carrying him down from Lester’s garden path. Two hours later, Rob was rescued from a tree by Nigel, a fireman, who took Rob to Lester. Lester put up notices round the village indicating that the reward was no longer an offer. Only later Nigel was made aware that there had been a reward for Rob. Lester refused to pay Mandy or Nigel the reward. Advise Lester of his contractual liabilities. Would you answer differ if Nigel is Lester’s younger brother and that he returned Rob before the reward was terminated? In order to understand the situation of Lester, it is first necessary to understand contract law, its element and breach of contract: Contract Law Contract can be defined as an agreement between two parties who have voluntarily come under an agreement to perform an action against possible benefits. This contract may be made either in written or orally. In order for an agreement to be considered as a contract, it must fulfill certain basic elements of a contract. These include: Offer and Acceptance For a contract to occur, one party must make an offer to another party. This offer when accepted by the other party leads to agreement between the parties and this agreement is the first part of the contract. If a counter offer is made by the other party, it is not considered as an acceptance. Consideration It is imperative that both the parties offer to provide some value to the contract. This value could either be in the form of services or money or both. A bargain should thus be struck between the two parties; however, it is not legally bound that the value be of equal amount from both the sides. Contractual Capacity Contractual Capacity refers to the ability of the parties to come to contract with each other. These parties must be competent to fulfill the obligations of the contract under the law. Legality The agreement made between both the parties should be legal in nature and should not no against the interest of the law or the public (Miller and Jentz, 2009). The breach in contract may either be a minor breach or a major breach. Minor Breach is said to occur when the breach in contract does not result in any big grievance on the part of the complaining party. However, a major breach is when the complaining party suffered unduly due to the poor performance of the other party. If a major breach is said to occur, the court allows the complaining party to consider the breach as terminated. In such a case, they are not required to perform their end of the bargain (Walston-Dunham, 2008). Contractual Liabilities The concept of contractual liabilities most obviously falls under the topic of Contract. Contract involves the promise or undertaking of a party to another party to fulfill an obligation. The law of contract deals with the obligations that arise as a result of this promise and it is the breach of this promise that leads to the occurrence of Contractual Liabilities (Beale, Bishop and Furmston, 2007). Contractual Liabilities may be defined as a liability that one incurs because they failed to fulfill the terms of the contract and are thus held accountable for the breach. In order to fully grasp the situation that Lester faces, certain cases are going to be discussed. These cases are quite similar to Lester’s case and thus would provide a better understanding of the issue. Carlill Vs. Carbolic Smoke Ball Co. In this case, Carbolic Smoke Ball Co. offered through various newspapers to give a reward to anyone who caught the disease, influenza after using the ball three times a day for two entire weeks. Carlill took up the offer presented by Carbolic Smoke Ball Co. and used the ball as directed by the company. However, after Carlill used the ball and caught influenza, the company refused to pay up on the reward money. Carlill, thus, filed a case against the company. Carlill won the case against Carbolic Smoke Ball Co. since the newspaper advertisement was considered as an offer which was later accepted by Carlill, thus binding both Carlill and the company under a contract. Also since the offer defined the quantity, price and implied a promise, the company had provided the due consideration for the promise to be considered as a contract (Aspen Publishers, 2007). However, an offer can be rejected on certain terms. The offer of reward given by Lester can be terminated on the following conditions: Rejection: An offer is said to be terminated when the person to whom the offer was made rejects the terms of the offer. In the case of Lester, no counter offer was made thus Lester could not rely on this aspect for terminating his offer. Counter-offer: Acceptance should be in such a manner that the other person accepts all aspects the offer. He should not reject the original offer, but proposing his own terms and conditions. Request for Information: A request for further information on the offer does not terminate the offer. The offer becomes a contract when the other party accepts with a request towards more information Lapse of Time: Under this condition, the offer has to be accepted under a specified time given. If no time is given, then it should be noted that the offer would expire after a reasonable amount of time has passed. Failure of a Condition: An offer is said to be terminated when it depends on the occurrence of an event and that event does not take place Termination by death: When either of the parties in the contract dies, the contract is terminated; and none of the parties’ relatives would be liable for completing the contract (Blum, 2007). Revocation of an offer: Under this rule, the offering person is allowed to take back his offer if the offer is not accepted before he revokes the offer. Even if the offering person has specified a time limit for the offer, he may take back on his offer before the specified time. However, it is important that the revocation of an offer be understood by an offeree before it becomes valid. This will be explained in detail through the help of the given case below Byrne Vs. Van Tienhoven Van Tiehoven and Co and Byrne and Co were considering getting into a contract where Van Tienhoven offered to sell 1000 boxes of tin plates at a specified price. The communication was done through post where Bryne and Co. accepted the terms of the contract at the same time when Van Tienhoven posted to revoke the offer since the price of tinplates had gone up. The court in this case held the judgment that for an offer to be revoked, it must be received by the offeree and understood by him. Since Bryne and Co. did not receive the letter revoking the contract, therefore Van Tienhoven was liable to Bryne and Co. under contractual liabilities (Gillies, 1988). Advice to Lester An advertised reward is a contract where the advertiser is giving an offer to the public that the public accept by completing the action specified in the advertisement. According to the law, the advertised reward by Lester holds Lester under the contract since Lester gave an offer when he published the reward in the local newspaper. Mandy or Nigel, by bringing the dog to Lester, was in fact accepting the offer. However, though Lester made an offer that was accepted by Mandy, Lester went on to terminate the offer by revoking it. Even though Lester revoked the contract, he is liable to pay since Mandy did not receive information revoking the offer. Furthermore, Mandy has informed Lester through telephone that she had accepted the offer. Therefore the offer had been accepted by Mandy and Lester only revoked it after the offer was accepted. It should be understood that Lester had revoked the offer without knowing that his offer had been accepted but under the Byrne Vs. Van Tienhoven case, Lester would be liable. Thus if Lester does not pay up on the reward that he initially promised, he would be breaching the terms of the contract since even though he revoked the offer, this information did not reach Mandy or Nigel. Alternative Scenario Even if Nigel was Lester’s brother, Lester would be bound to pay the reward to Nigel. This is because Lester formally announced the reward in the newspaper and the revocation of his offer was not known to Nigel. References Anon., 2007. Contracts: Keyed to Courses Using Calamari, Perillo, and Benders Cases and Problems on Contracts, New York: Aspen Publishers Beale, H., Bishop, W. and Furmston, M. 2007. Contract, UK: Oxford University Press Blum, B. 2007. Examples & Explanations: Contracts, 4th Edition, New York: Aspen Publishers Online Caven, R. 2004. Business Law, New York: Routledge Gillies, P. 1988. Concise Contract Law, USA: Federation Press Hanson, S. 2012. Legal Method and Reasoning, New York: Routledge Harpwood, V. 2000. Principles of Tort Law 3rd Edition, New York: Routledge Miller, R. and Jentz, G. 2009. Fundamentals of Business Law: Excerpted Cases, Ohio; Cengage Learning Mitchell, A. and Dadhania, M. 2003. As Level Law, New York: Routledge Lynch, J. "ADR and Beyond: A Systems Approach to Conflict Management", Negotiation Journal, Volume 17, Number 3, July 2001, Volume, p. 213 Walston-Dunham, B. 2008. Introduction to Law, Ohio: Cengage Learning Zander, M. 2004. The Law-Making Process, UK: Cambridge University Press Read More