Legal Framework of Business - Coursework Example

Running Head: Business Law Business Your name Course name Instructor’s name Date of submission Table of Contents Table of Contents 2 Introduction 3 2.0. Background 4 3.0. Defenses 5 3.1. Contributory Negligence 5 3.2. Voluntary Assumption of Risk 8 3.3. Express Exclusion of Liability 9 3.4. Expiration of Time 9 4.0. Remedies – Damages 10 4.1. Nature of damages and Once-And-For-All Rule 10 4.2. Pecuniary Loss 10 4.3. Non Pecuniary Loss 10 5.0. Analysis 11 5.1. Duty of care 11 5.2. Duty of care for Negligent Advice 12 5.3. Breach of standard care 12 5.4. Jurisdiction 12 6.0. Conclusion 13 7.0. Reference 14 Introduction Legal framework of business falls under the legal structure within which commercial decisions are made. It gives a clear platform of understanding the legal aspects governing a business which are referred to business law which incorporates laws of agency, trust, taxation, insurance, property law and other legal standing that affects business practitioners such as occupational safety and health laws. Law is rules established by parliament and or courts which are fully recognized and enforced by courts of law (Winfield & Jolowicz, 2002). When enforcing these rules, force can be used where necessary like seizure of property or goods when one fails to pay fines or after a court order. Laws made by parliament are enacted through parliament registration and regulations. Those made by parliament are called statue law. Those made by the courts are un-enacted consisting of important legal principles, tests, rules and guidelines handed down by courts from the judgments of cases heard many years back. They are referred to as case law (Weir, 2004). Basically, every country has well formulated business and constitutional law. Australia not exempted she has well written and articulated constitutions of each of her six states, and the main source being the printed constitution of the Commonwealth of Australia. In regard to business laws, the Corporation Act 2001 is aid to be the principle act that has the powers to regulate any commercial entities in Australia (Ryan et al, 2001). It controls entities like the creation and functions of companies to comply with a structure that may be assumed by the said business establishment. Throughout Australia, business organizations operate within increasingly complex legal and regulatory frameworks which originate from legislations, government regulations and common law as well as industries code of conduct and other self regulatory arrangements. All businesses must therefore be compliant with the entire legal framework meaning that, they must ensure that they meet the legal and regulatory requirements applicable to its business activities (Lunney & Oliphant, 2003). 2.0. Background Laws originate from parliament and courts and are named as statue law and case law consecutively. In Australia law in enacted so as the society can be maintained. In this matter, it is aimed and accomplishing its functions like maintaining order in the society, maintain basic freedom and finally for providing framework of rules for business operation. First, maintaining order in the society is implemented to protect persons and property for instance the deterrent effect. Secondly, in the case of maintaining basic freedom is aimed at safeguarding against arbitrary imprisonment through laws dealing with arrest, trials and appeal procedures. Finally, laws are directed to providing a framework of rule for business operations meaning that, it is used to facilitate the conduct of the business and commerce with perks of certainty of the outcome. Laws are classified into several ways putting into consideration of their subject matter encompassing civil and criminal law, their source encompassing the case and statue law and finally by historical origin encompassing of common and equity law. Criminal and civil law criminal raw involves the public enforcement by the state of laws on behalf of society as whole against individuals (lliot & Quinn, 2005). This is the state v person matter. Civil law involves the private enforcement of ones individual rights against another. It is a person v person dispute or matter. This in short is a private matter. Both criminal and civil law can arise from the same incident or act. Then, there is case and statue law. Case law, are judgments of the high court in cases tried before them. They are bodies of recorded principles of law from judicial decisions over the years. Statue law is legislation enacted by parliament and all legislation enacted by subordinate legislative bodies such as local councils and statutory authorities which have been assigned powers by the parliament to do so. The other category is common and equity law. Common law is categorized common law as the law which was common to all England, common law as a synonym of case law, common law as a legal system and common law as a body of legal principles developed by the common law courts. Equity law revolves around are share ownership as well as how the business is managed. 3.0. Defenses 3.1. Contributory Negligence Negligence is a branch of civil law known as tort law, meaning that, negligence is a tort. A tort is a civil wrong in the form of breach of duty for which the legal remedy is an award of damages. A tort institutes a duty on a person in certain circumstances and if breached the plaintiff is entitled to damages as compensation for the loss or injury suffered. The rights protected by tort law include the rights of individuals not to have their property, reputation, person or certain interest injured (Warne, 2001). Negligence is the doing of something which a reasonable person would not do or failure to do something that a reasonable person would do which in the long run inflicts harm. This insinuates that the plaintiff don’t have to prove that the defendant intended his act or its consequences or not (Jackson & Powell, 2001). It is worth noting that, negligence involves more than just caress conduct, and involves a combination of the concept of duty, breach and sufficient connection in law. The plaintiff must prove on the balance of probabilities in order to succeed an action of negligence. The plaintiff must prove that the defendant owed him a duty of care, the defendant failed to conform to the required standard care and finally that there was sufficient connection in law between the defendant’s conduct and the damage (Masel & Kelly, 2000). The defendant must owe the plaintiff a duty of care which must be proved by the plaintiff. If this is not done, then the claim might be dropped. The judge handling such a case is responsible of deciding whether or not a duty of care exists or the issue in the question of law having regard to the facts of the case. The defense of contributory negligence which originated at common law arose when the defendant could prove a failure by the plaintiff to take reasonable care for the protection of his/ her property. It is vital to note that the defense was not and will never be based on the idea that the plaintiff owes duty to the defendant for the law expects people to take care of themselves at all times in all circumstances (Masel & Kelly, 2000).. However, the common law had no idea on proportional liability in this context, where contributory negligence was established operated to defeat the plaintiff’s claim altogether and therefore, a small kind of imprudence by the plaintiff might enable more serious negligence. The courts in this case work towards avoiding a finding of contributory negligence sometimes making decisions which don’t match the evidence. The common law rule that, contributory negligence was an absolute defense has been changed by statue in Australia. The relevant provisions are therefore the contributory Negligence Act 1947 (South Australia), Wrongs Act 1936 (Western Australia), Law Reform (Contributory Negligence and Tortfeasors’ Contribution) Act 1947 ACT, Law Reform Act 1955 (Northern Territory), Law Reform Act (Queensland) (Victoria) and finally Wrongs Act 1958 (New South Wales). Under the statutory regime, courts are directed to allocate responsibility between plaintiff and defendant on a just and equitable basis according to their degree of responsibility. Meaning that, if a plaintiff is held to be 30% to blame will recover only 70% of the loss which he/she suffered. There can also be professional negligence where by one may be misguided by a professional service provider. This can appear in form of an act of omission by the client which contributes to the incorrect need of the advice given by the professional, failure by the client to realize that the advice given by the professional is incorrect, and finally a decision by the client to release that the advice given by the professional is incorrect in anyway (Jackson & Powell, 2001). However, it is made clear that paying a professional adviser does not make a layman forget about the common sense. The plaintiff being layman, knowing nothing, if he was aware of the risk and his evidence shows that he was unaware of the same it cannot be said that he was negligent in failing to comprehend it (Jackson & Powell, 2001).. 3.2. Voluntary Assumption of Risk As noted earlier, the apportionment Legislation mandates the courts a very wide discretion to reduce the damages payable to the plaintiff who has been contributory negligent. The guidance to this is that the reduction should be based on court’s consideration of just and equitable. The plaintiff damages can be reduced in up to 90% for 100% is not permissible for it will mean that the plaintiff was wholly responsible for the damaged incurred while else the apportionment legislation states that he/she suffered damages partly as a result of his/her own fault and partly because of the fault of another person (Jackson & Powell, 2001).. Despite this decision, it has been viewed that, a court is entitled to reduce a contributory negligent plaintiff damages by 100% incase there be a desirable reform of the law of negligence. Voluntary assumption of risk is a complete defense which provided the basis for denying plaintiff any damages at all. A person is assumed to have voluntarily assumed a risk if they were actually aware of the risk in question and freely accepted that risk. In other words, one was capable of preventing the injuries but did nothing to do so. It is worth noting that, the defense of contributory negligence and the defense of voluntary assumption of risk are only applicable when it has been agreed that the defendant was negligent and that the harm suffered by the plaintiff resulted from that negligence. This means that, there are times when plaintiff is so much responsible of the injuries suffered in that denying the plaintiff any damages is very fair (Harris, Campbell & Halson, 2002).. 3.3. Express Exclusion of Liability An individual can exclude liability by disclaimer notices or exclusion clauses unless prevented by statue. It is aimed at protecting the trustee from liability for any breach of trust categorized in negligence and carelessness. 3.4. Expiration of Time Under the limitation act 2005 (WA), the time made available for a plaintiff to take action will ultimately expire if no action is taken. This period is generally years from the cause of action accruing. However, the plaintiff seeking damages for personal injuries has three years to take action from the cause of action accruing and the court can extend this time on special circumstances. In connection to common law tort principles, the limitation period starts at the point when the loss was suffered (Harris, Campbell & Halson, 2002).. 4.0. Remedies – Damages 4.1. Nature of damages and Once-And-For-All Rule It is a fundamental principle that an award for damages is that the claimant should be fully compensated for his loss. In this case, the court has no powers to require the defendant to make periodical payments. Once the damages are assessed the award is them forwarded through a lamp sum. This principle plus with the rule that damages can be recovered once only causes a lot of difficulties in actions for personal injuries particularly where medical prognosis is not well defined or known. However, in this principle, it carries several disadvantages for it can result to under compensation which disadvantages the plaintiff who is prevented from commencing another action over the injuries or over compensation for the injury. The award is final; it is not susceptible to future review and substitute’s fact for estimate (Rogers, 2001). 4.2. Pecuniary Loss When one person wrongfully causes the death of another, the action can be brouigh in favor of the deceased relatives. Damages maybe claimed on behalf of the relatives for the loss of financial support and the loss of the services that they suffer as a result of the said death. The assessment of such a damage is solely dependant on a determination of the pecuniary value of the support that the deceased would be expected to provide to the claimants if he/she had not died (Harris, Campbell & Halson, 2002). 4.3. Non Pecuniary Loss Non pecuniary losses are losses that are suffered by damaging goods or interests which do no have economic prices or financial value in the market. For instance damage to one reputation or death of a person. Having that they do not have any market value, means that they cannot be undone using money at all. Therefore it means that they are losses which do not damage a person’s assets or wealth or even income and therefore it’s not capable of being quantified in the financial market (Rogers, 2001). These loses are considered to form an important aspect of tort liability which states that an increase in resources in a society enhances the increase of the protection and recognition by law of new personal interests. In most cases and in many jurisdictions, contributory or comparative negligence defense is used in deciding on the amount of compensation (Giliker & Beckwith, 2005). It is worth noting that, the lack of market price of this losses leads to creation of high rewards which also means an increase in insurance premiums. 5.0. Analysis While doing business in Australia is open to all, it is very important to note that there are laws that govern the business activities and also that bide the employers as well as the employees. In case of a court case one need to understand that, there are protocols that are being followed and must be followed in regard to the type of a case and damages incurred. For instance, it is worth noting that there are some vital occurrences or procedures followed which call for clear understanding of the proceedings. For instance like the following procedures. There is a dire need to prove that the defendant was responsible of the damages experienced. The following are some of issues that need to be defined well; 5.1. Duty of care The defendant must owe the plaintiff a duty of care which must be proved by the plaintiff for the case to continue. There must be tests carried so as to ascertain that the duty of care was breached or not. This test was involved from the test from Donoghue v. Stevenson [1932] which was based on whether or not the injury was reasonably foreseeable and also the closeness of the plaintiff to the defendant. 5.2. Duty of care for Negligent Advice Visiting the case of Shaddock and Associates v. Parramatta city Council (1981) 150 CLR 225, negligent words cannot cause loss themselves; they only cause it because some one relies on them to make some crucial decisions (Harlow, 2005). This means that when an adviser’s information leads the decision makers into wrong decisions then he is responsible of the damages caused. 5.3. Breach of standard care A reasonable person is deemed to the following attributes; intelligence, knowledge and skill. As for intelligence, if the defendant has above average intelligence, he/she is not judged according to above average intelligence. In other words one is judged in accordance to the average intelligence processed (Masel & Kelly, 2000). Knowledge and skills of an individual are said to be irrelevant as it hangs on the qualification the person has. For instance a driver must be competent in his/her profession and therefore all the other in the business rearm is treated the same. If one has proved to be competent in any field, they he/she is judged according top that but for the case of minors, they are charged against normal children of age same as theirs. 5.4. Jurisdiction After the breach of duty of care is established, the plaintiff must then show that there was sufficient connection in law between the injury and use the conduct (Harvey & Marston, 2000). 6.0. Conclusion Business law falls under the category of the legal framework in the country and is well covered by laws which are said to originate from parliament and courts to govern how to go about the activities. It has been mentioned that, in the case of maintaining basic freedom is aimed at safeguarding against arbitrary imprisonment through laws dealing with arrest, trials and appeal procedures. Finally, laws are directed to providing a framework of rule for business operations meaning that, it is used to facilitate the conduct of the business and commerce with perks of certainty of the outcome. Laws are classified into several ways putting into consideration of their subject matter encompassing civil and criminal law, their source encompassing the case and statue law and finally by historical origin encompassing of common and equity law. Negligence is a branch of civil law known as tort law. A tort institutes a duty on a person in certain circumstances and if breached the plaintiff is entitled to damages as compensation for the loss or injury suffered. The rights protected by tort law include the rights of individuals not to have their property, reputation, person or certain interest injured. 7.0. Reference Dal Pont, G and Chalmers, D (2000). Equity and Trusts in Australia and New Zealand, LBCIC. De Jersey, D (2000). Turning up the heat on professionals. University of Queensland Law Journal 21:97. Giliker, P. and Beckwith, S.(2005), Tort, 2nd edn, London: Sweet & Maxwell. Harlow, C. (2005), ‘Understanding Tort Law’, 3rd edn, London: Sweet & Maxwell. Harris, D., Campbell, D., and Halson, R. 2002, Remedies in Contract and Tort, 2nd edn, London: Butterworths. Harvey, B. and Marston, J, (2000) Cases and Commentary on Tort, 4th edn, London: Longman. Lunney, M. and Oliphant, K. (2003) Tort Law Cases and Materials, 2nd edn, Oxford: Oxford University Press,. lliot, C. and Quinn, F.(2005) Tort Law, 5th edn, London: Longman Jackson, R and Powell, J (2001). Professional Negligence, 3rd ed. London, Sweet & Maxwell. Masel, G and Kelly, D (2000). Contributory negligence and the provision of services: a critique of Astley. Australian Law Journal 74: 306. Warne, S (2001). Legal professional liability - part 2. Torts Law Journal Weir, T. (2004), A Casebook on Tort, 10th edn, London: Sweet & Maxwell Winfield and Jolowicz, (2002) on Tort, 16th edn, London: Sweet & Maxwell Read More