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INTRODUCTION TO BUSINESS LAW

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CHAPTER ONE
INTRODUCTION TO LAW

Definition of Law - Law can be defined to as a set of rules and principles that are applied and
Recognized by a state or a community in the administration of justice. It’s also defined as a rule of
human conduct imposed upon and enforced among the members of given state.

Features of Law
1. Law is a set or Body of rules. These rules may originate from customs, Act of parliament,
constitution etc.
2. Acts as guidance for human conduct. Human beings follow these rules for their own safeguard
and betterment.
3. Applicable to a community. These rules apply to the specific community. A community may
refer to a country, a business community, a tribe etc.
4. Law must change. The law changes over a period of time i.e. law should not be static.
5. Law must be enforced -otherwise there should be lawlessness. The law enforcing “agencies/
machinery include police force and the court of law.

Law may be differentiated from morality. The rules of law may be enforced by an action in j court
but morality does not attract the sanction of the court for its enforcement. The requirement that the
person should respect his elders is a rule of morality, not a law and | nobody can be sued for failing
to respect his elders. Sometimes a person may break the law and morals at the same time. e.g. theft
is against J morality as well as law.

Purposes of Law
1. To maintain law and order
2. To provide justice to the members of the society
3. To maintain political and economic stability
4. To protect fundamental rights and stability
5. To maintain peace and security
6. To establish the procedures and regulations regarding the deals among the individuals and
regulations regarding the deals among the individuals.

Classification of Law
Law can be classified in various categories as outlined below:
1. Public and private law
2. Procedural and substantive law
3. International law.

Public law is that law that governs the relationship between the state and its citizen as well as
relationship among the various organs of the state. It is further classified into:
(a) Constitutional law - Contains the rules which regulate the relationship among the three organs
of the state namely executive, legislature and judiciary. It also includes all rules which directly
or indirectly affect the distribution and exercise of the sovereign powers of the state.
(b) Administrative law - This law relates to the public administration. It determines the
organization powers and duties of the administrative authorities.
(c) Criminal law - This is the law of offences against the state which are called crimes. This law
defines each offence and the prescribed punishment. All die offences are included in the Penal
code of Kenya

Private law is that part of the law that is primarily concerned with the relationships, rights, duties of
persons towards other persons i.e. citizen amongst themselves. A sub branch of private law is the
civil law which deals with the violation of private rights belonging to an individual e.g. refusal to
pay a loan, defamation etc.


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,Procedural and Substantive Law
Procedural law consists of the rules mat determine the manner in which the court proceedings are
required to be conducted in civil or criminal law.

Substantive law defines civil and criminal laws and provides remedies for each type of offence or
wrong.

International Law consists of the rules that govern different countries of the world other than the
country's local law. International law is classified into the following:
a) Public International Law- It regulates the relations among various states
b) Private International Law-Concerned with determining which national law is to govern a case
in which foreigners are involved.

Differences between criminal and civil wrongs
Criminal wrong (crime) Civil wrong
It is a public wrong against the state It is a private wrong against the individual

Parties involved in a case are the prosecution The parties are the plaintiff and defendant
and the accused
Parties cannot comprise in a given case. Parties can compromise in a case
The prosecution must prove its case against the Plaintiff needs only to prove his case the balance
accused beyond reasonable doubt of probability and not beyond reasonable doubt
Punishment is usually by imprisonment, fine or The defendant is ordered to pay to the plaintiff
death damages

Divisions of Civil Law
Civil law can be classified in to various categories as classified below:
(a) Law of Contract - A contract is an agreement between two or more persons which is legally
binding and enforced by the law.
(b) Law of Torts - A Tort is a civil wrong which gives rise to a claim of unliquidated damages.
(c) Law of Property - This is the part of the law which deals with the nature and extent of rights
which a person may have over it i.e. use of his land or his property.
(d) Law of Succession - This is the law that determines how property passes on the death of a
person to his heirs.
(e) Law of Trusts - This occurs when a person called settlor transfers properly such as money or
shares or land to another person called the trustee, for the benefit of another person called
beneficiary.

Advantages of Law
1. Law provides uniformity and certainty in the administration of justice. The same law has to be
applied in all case and there can not be any distinction between one case and another if the facts
are the same. Law is no respecter of personality and the legal system in a country is usually put
in black and white so that it is possible for all the people to know the law of the land.
2. The existence of fixed principles of law avoids the danger of arbitrary biased and dishonest
decisions. Since law is certain and known, any departure from the rules of law by a judge will
be visible to all.
3. The principles of law protect administration of justice from individual judgment. Judges are not
expected to substitute their own opinion for the law of the country. Salmond observes that: in
the long run, law is wiser than those who administer it.
4. Law is more reliable than individual judgment. Human mind is fallible and judges are no
exception. The wisdom of legislature which represents the wisdom of the people is safer and
more reliable as a means of protection from individual opinion of a judge.

Disadvantages of Law


PREPERED BY MR. ANTONY AMBIA Page 2

,1. Law is rigid - In an ideal system the legal system keeps changing according to the changing
needs of the people.
2. Law is conservative in nature - Both lawyer and judges favor status quo of the existing law.
3. Law is formalism - Law lays a lot of emphasis on the form of law than its substance, A lot of
time is wasted in raising technical objections of law which have nothing to do with the merits of
the case or dispute. While investing on the formalities of the law, injustice in many cases is
done since the innocent person may suffer and the clever and the crooked profit there by.
4. Law has undue and needless complexity - Law is never simple due to the complex nature of the
modern society. Lawyers also insist on drawing fine distinction on the various points of law and
this doesn't bring justice.




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, CHAPTER TWO
SOURCES OR KENYAN LAW

According to Salmond, the term sources of Kenyan law is defined to as that from which a rule of
law derives its force and validity i.e. it is llio will of the state as manifested iii the statutes or
positions of the court. The material source is Unit from which is derived the actual matter of the
law.

The Legal Pyramid
This is a diagram which shows the various sources of Kenyan law.




Constitution


Acts of Parliament


Specific British and Indian Acts

Equity
Delegated Case Law
Legislation


African Common Muslim Hindu
Customary Law Law Law
Law




The above sources of law are discussed below.
CONSTITUTION
A constitution is a public law document which regulates the relations between the state and its
citizens as well as the relations among tin- three arms of the government i.e. judiciary, legislature
and executive.

Our Kenyan constitution is in written form and was enacted on 12lh Dec 1963. The constitution has
11 major chapters and 128 sections. Section 47 of the constitution empowers parliament to make
amendments (changes). The first amendment of the Kenyan constitution was made on 12th Dec
1964 when Kenya became a republic headed by the president. The constitution is the supreme law
in Kenya and any other law that contradicts, differs or conflicts with the constitution is termed to be
unconstitutional or is said to be null and void.

The constitution determines the form of government the duties and rights of government towards its
citizens and of the citizens towards the government. For instance some countries have got an
unwritten form of constitution e.g. Great Britain. An unwritten constitution is that in which most of
the fundamental principles and laws are not given in written form.


PREPERED BY MR. ANTONY AMBIA Page 4

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