Law Questions

Question 1

i) Define Law

There are quite a lot of definitions of law but no agreement as to the precise meaning. Some of the definitions of law are as follows:

According to Blackstone law is that part of rule or action which can be applied randomly to all forms of action.

According to Salmond law is a body of rules acknowledged and enforced by the State in the organisation of justice.

According to Wilson law is that segment of the customary consideration and custom which has earned separate and formal credit in the form of consistent rules supported by the authority and ability of the Government.

ii) Explain the following sources of law and two of their benefits:

a) Common Law and Equity

b) Legislation

Common law is a law created by judges, as opposite to laws authorised by a legislative body. When a case is decided by a judge then his decision and the basis of the case becomes a precedent which other courts follow while deciding a case which is similar in nature. The systems of rules of Common law is dependent more on judicial decisions and less on civil law systems which in turn is dependent mainly on written laws and statutes. The main feature of the English legal system is that it is living and constantly evolving to work in the future as well as it did in the past[1].

Thus the single most unique feature of the English legal system is its inheritance from common law[2]. Most of the characteristics commonly linked to English law and its management of righteousness are traceable to the early on growth in Western Europe of the civil and common law customs. According to Goodman (1995), "several characteristic consequences flow from the fact that law did not emanate from one centralised authority such as papacy, king or parliament.

The odd growth of the common law in England arose from a co-occurring similitude after the Norman take-over by successive monarchs of native customs as the basis for the governance of justice. Conflict judgment, mainly relating to land title, was a key function for justice. Judges were appointed by the king to travel all over the country and resolve controversies, supported by a local adjudicator who was appointed by the Normans into operational royal courts. The trial accepted a key role in the settlement of disputes.

Wilson (1995) states that “Everyone takes for granted the fact that law and legal systems differ in different countries. But it is also true of legal scholarship. One reason for this is the different responsibilities legal scholars have in different countries for the maintenance and development of the local law...One result is that legal scholars in different countries may have different agendas and this may affect the subject matter, scope and even the form and style of the local legal scholarship.”

II:

According to Blackstone and Morrison (2001) Common law is that part of law which can be found in the registers of our numerous courts of justice, in books and judicial decisions. It is also found in treatises of knowledgeable sages who are in the profession. These rules were dictated and passed down to us from the periods of ancient antiquity. These are the laws which developed and originated to form a collection of maxims and customs which is presently known as common law.

Equity law was formulated after the common law and developed to setoff the fixed versions which the chivalric English judges were contributing to the common law. However, the common law is more compromising, than the civil law or any other completely statute dependent legal systems.

The law for Equity was a separate, stretchy law established on the Chancellor's moral sense and utilised where no dictated common law remedy subsisted. Equity turned out to be popular and now it proceeds to provide a remedy for the altering requirements of society where no remedy can be detected at common law.

Legislation is the commonest source of new laws or of law reform after the Seventeenth century. The most vital legislation is Acts of Parliament which is known as primary legislation. This becomes binding only after approval in the House of Commons and the House of Lords; after which it gets the Royal Assent from the Queen. A larger volume of legislation is these days made under the influence of primary legislation by Government Ministers, and there is no need of any approval from the Parliament in advance. This is known as delegated or secondary legislation. Delegated legislation is brought out under a precise power in the "parent" or "enabling" Act. Such legislation is published in the form of statutory instruments and may be styled as "regulations" or "orders".

Delegated legislation is used for the following reasons:

To save time in Parliament.
To permit for expert participation into their plan and proficient language to be utilised in their wording
To permit suppleness in reacting to events and representations

Question 2

i) Discuss and explain the hierarchy of the main civil courts in the English legal system.

The civil justice is a chief area of the English legal system and is planned to separate challenges between individuals or organisation. This system has been modified with in many years as a result of specific propositions made by civil justice review and carried out in the Court and Legal Services Act 1990. There are four major civil courts in the English Legal System, which accommodate civil jurisdiction: the County Court, High Court, Court of Appeal and the House of Lords. There are also minor civil courts like the magistrate's court and the European Court of Justice, which sets case law for all the courts. The County Court covers with the broadest range of civil matters. There are at present around 300 county courts

Source: http://www.law.duke.edu/lib/researchguides/english accessed on 6th May 2010.

ii) Explain the three track system for allocation cases between courts.

The English law cases are allocated a three track system of trial. They are as follows:

Small Claims Track

Under this claims up to £5,000 in value (£1,000 for cases that involve personal injury or certain housing unsoundness claims) are taken up. Allotment of cases to this track is not routine but it is subject to the court's thoughtfulness of the Statements of Case presented by the parties.

Fast Track

Fast track applies to claims which have a value between £5,000 and £15,000. When apportioning claims to the Fast Track, the court will provide case management instructions to the parties and may arrange a rigid timetable and determined price limits. The trial date may be determined at this stage and will usually be within 30 weeks.

Multi Track

Multi track applies to claims which are above £15,000. This necessarily includes most commercial cases.

Apart from taking into consideration the monetary value of a claim, the Court, while apportioning a claim to a track, will regard other elements like:

1. the intricacy of the case;

2. the significance of the claim to the parties and to others;

3. the considerations of the parties;

4. the quality of the proof to be demonstrated;

5. the trait of any counterclaim(s); and

6. The number of parties affected.

Question 3

In relation to company law:

i) Explain the powers and the duties of directors

Duty to act within their powers

This is based on the common law rule that directors must use their powers only for such actions for which they were given the powers.

Duty to promote the success of the company (section 172)

The duty which is laid down in section 172 substitutes the common law duty of dedication. This duty of the Directors is often worded as the duty to act in good faith and also in the best concerns of the company. The new duty requires a director to encourage the success of the company. The promotion should be for the welfare of the members as a collective body: it should not be just for the sake of the majority shareholders, or any individual shareholder or section of shareholders. This duty on the part of the directors calls for the following six specified factors:

- The likely effects of any resolution in the long term

-The interests of the company's employees

-The need to promote the company's business dealings with suppliers, customers and others.

- The affect of the company's procedures on the community and the environs

- The desirableness of the company preserving repute for high standards of business conduct

-The need to act reasonably as between members of the company.

(http:www.law-now.com accessed on 6th May, 2010).

Failure to Act in honesty by the Directors of the company in compliance to Section 172:

This duty of the directors has led to recent corporate failures in protecting Shareholders money were the prime reasons behind theCompany Law Review to form a model of the Company in the Companies Act, 2006. On a close scrutiny, it was alarming to note that the non-executive directors of these Companies were too near to executive directors holding too many jobs at a time and did little to control corporate abuses. Many of them forgedthe accounts to give themselves lavish fat cat rewards, bonuses and share options. They made extensive use of tax havens to create complex corporate structures and produced opaque accounts. Auditors were in hand with management and their reports were misrepresenting. Thousands of innocent people have lost their savings, investments, pensions, jobs and homes because of this.

3. Duty to exercise independent judgment

Section 173 of the Act enforces a positive duty on a director of a company to practice self-governing judgment.

4. Duty to exercise reasonable care, skill and diligence

This duty is laid down in s. 174(1). It systemises the common law rule of duty of care and skill. S. 174 (2) dictates the level of ‘care, skill and diligence' anticipated from a director;

5. Duty to avoid conflicts of interest

The conflicts of interest provisos are previously held in Part 10 of the Companies Act 1985 and are quite multifaceted. The Act repeats, improves, and changes these provisos to make them more reachable and with a view of supporting modern business practice.

6. Duty not to accept benefits from third parties

This is in line with the present rule known as ‘non profit' according to which a director is not allowed to take a profit from a third party while in his position as a director or under circumstances in which he does anything or does not do anything as a director.

7. Duty to declare interest

Section 177 of the Act reflects s.317 of the 1985 Act in that it calls for a director to reveal his interest to the board of the company when dealing is suggested between a director and his company. Disclosure also covers a person linked with the director, for instance, his wife and children.

Distinguish between:

a) Executive directors; and

b) Non- Executive directors

An executive director is an associate of the board of directors and a member of staff of the company. He/she will have a detailed role for instance finance director and as such they are responsible for the day to day management of the company inside their sphere.

A non executive director is also an associate of the board but not an employee of the company. He/she is for his/her proficiency and is allowed to take part in decision making at board meetings.

The non-executive's function is an ‘over-viewer and whistle blower', assuring attachment to good practice, honour for the interests of other stakeholders and attachment to the procedure of boardroom discipline. Non-executive directors are time and again thought of as “advisers” even though this is not the case. The role is bigger than this - the non-executive is a director and shares the legal obligations and duties of the executive directors.

Question 4

i) In relation to the tort of negligence, explain the standard of care owed by one person to another

The law of negligence was originated in a court case Donahue v Stephenson (1932) where a woman named Donahue suffered from gastro-enteritis after ingesting ginger beer from a container which had a dead snail in it. She filed litigation and sued for damages for personal injury. The judge held that the manufacturer had a 'duty of care' for the protection and security of Donahue, despite the fact that actually her friend had bought the bottle. The manufacturer who supplied a bottle of ginger beer was negligent on his part because he failed to notice the dead snail.

According to Lord Atkins who decided the case stated that reasonable care must be taken so that acts or deletions which can be fairly anticipated would end up in injuring a neighbour.

ii) Roger is a keen boxer. He has been successful in many fights but recently took part in a fight in which he lost to jack. The fight took place under the necessary safely regulations and was stopped before Rogger was beaten too badly. However soon after the fight it was clear he had received severe brain damages and now has difficulty talking.

Assuming the fight organisers have breached their duty of care, do they have any defence that will limit or eliminated their ability for the injuries caused to Roger?

Duty of care is said to have been breached and this is best conceived and summed up in Blyth v Birmingham Waterworks.[3] In this case Baron Alderson stated that negligence was an omission which a reasonable man fails to do. In reality a reasonable man is always directed by the situations which normally control the behaviour of human affairs.

In this problem since the organisers have breached their duty of care they cannot defend themselves in law. The damage to Roger has already being committed because he was injured and also the injury resulted in a permanent impairment so the liability of the organisers is severe.

Bibliography

Books

Allen, C., 1927. “The Law in the Making.” Oxford: Clarendon Press, p.302.
Baker, J. H., 2002. “An Introduction to English Legal History.” London: Butterworths Lexis Nexis. P.196-197.
Buckland, W. and McNair, A., 1965. “Roman Law and Common Law.” Cambridge: University Press.
Blackstone, William, and Morrison, Wayne. 2001. “Commentaries on the Laws of England.” Routledge Cavendish
Brenner, Saul, and Harold Spaeth. 1995. Stare Indecisis: The Alteration of Precedent on the Supreme Court, 1946-1992. New York: Cambridge University Press.
Bussani, Mauro, and Vernon Valentine Palmer (editors). 2003. Pure Economic Loss in Europe. Cambridge: Cambridge University Press.
Holmes, Oliver Wendell. 1897. The Path of the Law. Harvard Law Review 10: 457-478.
Daniel Webster, Edwin Percy Whipple, (2006), The great speeches and orations of Daniel Webster: with an essay on Daniel Webster as a master of English style, Little, Brown, & co.
Gary Slapper, David Kelly, (2001), Sourcebook on the English legal system Cavendish Sourcebook Series Cavendish Publishing sourcebook series, Routledge.
Goriely. T, 1998. “Making the Welfare State Work”, in F. Regan, A. Paterson,
Goriely, T. and Fleming, D. (Eds.) The Transformation of Legal Aid, Oxford: Oxford University Press.
Genn, H. 1999. “Paths to Justice: What People Do and Think About Going to Law.” Oxford: Hart publishing, p.12.
Merson, Rupert. 2003. “Non-Executive Directors.” Profile Books Ltd
Paul Bergman, Sara J. Berman, (2008), The Criminal Law Handbook: Know Your Rights, Survive the System, Nolo.

Web Sites

http://www.law.duke.edu/lib/researchguides/english accessed on 6th May 2010.
http://www.chriswallis.com/uni/cnlaw231l01.pdf accessed on 6th May 2010.
http:www.law-now.com accessed on 6th May, 2010
http://www.bytestart.co.uk/content/legal/35_2/companies-act-directors-duties.shtml

Acts and Statutes

Companies Act 2006 and Private Companies
Companies Act 2007 - Major Changes for Small Business Owners

[1] As Philip James says in his Introduction to English Law: “the Common Law may well prove as vital and enduring as the Roman Law, its mighty rival”. James, Philip Seaforth, Introduction to English Law: 5th ed, 1962, Butterworths, London, from p. 13

[2] See, for example, R C Van Caenegem, Birth of the English Common Law, 1988, (2nd Ed), CUP, Cambridge, Chap 4; Ellen Goodman, The Origins of the Western Legal Tradition, 1995, Federation Press, Sydney, Chap 8; and H`Patrick Glenn, Legal Traditions of the World, (2nd edition) 2004, OUP Oxford Chap 7

[3] (1856) 11 Ex Ch 781, 156 ER 1047