LPC NOTES ON COMMERCIAL LAW :(COMPLETE GUIDE -100% VERIFIED) |LATEST

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LPC NOTES
[COMMERCIAL LAW]
(2019-2020)




Business law and practice lOMoARcPSD|4177510

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LPC NOTES ON COMMERCIAL LAW

Chapter 1 – Law, Society, and Business

The Role of Law
 Influences and controls the behaviour of individuals in society
o Sets basic standards of behaviour that are enforced by
government and also organizations and groups with the
help of the government
o Law is needed to protect persons, property, and society as a
whole
 Empowers, influences, and controls the actions of government
o Rule of Law establishes legal principles that treat all
persons equally, which government is also bound by and
must obey
o Law that regulates the government and its relationships
with private persons
 Influences and controls interactions between individuals
o Enables us to make legally binding agreements enforced in
the courts
o Referred to as private law (civil law)


Forms of Legal Liability
 Lawmakers use three forms of liability to influence
individual behaviour
o Criminal Liability
 Against government and society as a whole; public law
o Regulatory or quasi-criminal Liability
 Less serious offences enforced through regulatory
bodies set up by the government for specific
purposes; public law
o Civil Liability
 Breach of private law; enforced through civil lawsuit
initiated by victim

Law and Business
 With regards to the laws regulating a business and its
relationships with government, stakeholders, competitors,
and suppliers
 Business may be faced with different rules for each country
in which they operate, causing conflict among the law
o Treaties, conventions, and model laws attempt to
harmonize these laws as to limit conflict
o Super-government organizations like the UN and WTO
work to find commons approaches to international issues

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Legal Risk Management
 Legal Risk occurs wherever a business can potentially face
legal liability through their business activities
 A legal risk management plan must be developed by a
company to outline potential legal risk that may occur, and
preventative measures and strategies

Steps in Development of a Legal Risk Management Plan
1. Identify potential legal risks
 Through ways of a legal audit that explores every area of the
company
2. Assess and prioritize each legal risk based on likelihood and magnitude

3. Develop a strategy to address each risk from both proactive
and reactive perspectives
 There must be a plan to prevent the risk from occurring and
one that also minimizes the consequences if it does occur
4. Implement the plan
 Announcing, educating, training, testing, and monitoring the plan
5. Regularly review and update the plan
 New legal risks must be added to the plan

Strategies to Manage Legal Risk
1. Avoid the risk
2. Reduce the risk
3. Transfer the risk (to an insurance company)
4. Absorb the risk (self-insure)
 All strategies used in combination

Sources of Law
 The Constitution
o Made by monarch or a government
 Legislation/Statutes
o Subordinate legislation
 Handed down by a body designed in the statute, i.e.,
federal government or cabinet minister
o Administrative Rulings
 Handed down by bodies created by the legislation
 Court decisions
o Judgements handed down by single judges or panel of judges
o Decision referred to as Case Law