1 Introduction

◇ General survey
Legal system + Effect of law on business operations
◇ Business organizations
Characteristics + Choice + Formation + Corporate governance
◇ Business contract
Formation + Terms + Discharge + Breach & remedy +Sales
contract + Employment contract
◇ Business liability
General + Extent +To community & state + To Creditors +
Shareholders and directors’ liability + Partners’ liability
○ Objective:
(1) Transnational legal service
(2) Lawfully manage business organizations
(3) Do business in common law jurisdiction
(1) Lecture (English)
(2) Video (Cases)
(3) Panel discussion
○ Timing:
(1) Week 1-16: lectures
(2) Week 17—18 : Tutorial
(3) Week 19—20: Exam
○ Textbook:
(1) Business & Law, MacIntyre, Financial Times Pitman Press
(2) Reference, China’s Commercial Law, Law Press(2003)
○ Evaluation:
(1) Total score= class performance(30%) + final exam (70%)
(2) Four types questions:
Objective model, Best choice(10%)
Objective model, Brief answers (50%)
Subjective model, analytical questions (20%)
Subjective model, case analysis (20%)
1 Meaning and Classification
1.1 Meaning
(1) Scope : England + Wales;
Scotland +Northern Ireland: different
(2) Case law tradition; Partially codified
(3) Purpose: property protection + public order control
1.2 Classification
1.2.1 Public and private law
(1) Public law: conduct of government and relations between
government and individuals
(2) Private law: relations between private individuals or groups
1.2.2 Substantive and procedural law
(1) Substantive law: rights and duties of each person in society
(2) Procedural law:protection and enforcement of them
1.2.3 Civil law and criminal law
State v defendant
Plaintiff v defendant
Guilty or not guilty
Plaintiff wins or loses
If convicted, then sentenced
If he wins, obtains a remedy
Magistrates, or Crown court
County or high court
Legal aid; If convicted, pay
Magistrate or jury
Legal aid; Loser pays all costs
Beyond reasonable doubt
On balance of probability
Murder, theft
Contract, property
Standard of
2 Sources of law
2.1 common law and equity law
2.1.1 Common law: law made by judges,judicial precedent,
stare decisis
(1) local customs, before Norman Conquest; King Henry Ⅱ
unify the law: uniform law
(2) Problems:
Obsession with procedural details
Limited remedies
Bias: bribery and corruption
2.1.2 Equity law
courts of chancellor, courts of equity; merger of the two in 1873-1875
by the Judicature Acts
Courts always have discretion as to grant of equitable remedy
Maxims of equity
Equity will not suffer a wrong to be without a remedy
He comes to equity must come with clean hands
Delay defeats equity (doctrine of laches)
Equity looks to intent rather than the form
Equity acts in personam: remedy only enforceable against individual
Common law remedy: enforceable against anyone
Common law
Equity law
Rigid & inflexible
Flexible: fairness, conscience and moral code
Complete system
Supplements the common law
Sole remedy: damages
Various remedies
Time limit: 1-6years
No strict time limit
2.2 Statutes law: legislation and delegated legislation
2.2.1 Meaning
(1) by parliament, state or provincial legislature, or municipality
(2) Superiority: overrides common law dealing with same point
(3) common law and statute are now closely related
(4) administrative law: system of government regulations and
2.2.2 Act of parliament
(1) Functions
Enact new law
Authorize tax
Consolidate existing statutes
(2) Bills
Public bill: whole or certain class of people
Private bill: relate to particular persons or places
Hybrid bill:
(3) Procedures: Public bill
First reading
Second reading
Committee stage
Report stage
Third reading
Royal assent: it is always given by the royal, no rejection
2.2.3 Delegated legislation Types
(1) Orders in council: issue by monarch by the advice of Privy Council
Privy council : nominal body
(2) Statutory instruments: rules, regulations and order by ministers
(3) By-laws: by local authorities or other bodies
(4) Professional regulations: law society; accountant association Main advantages
Parliamentary time is saved
Adaptive to social changes
Especially useful for areas requiring expertise: tax, defense, medical
Useful for emergent situation Controlling delegated legislation
Parliament has final control
Consultation of interests
Judicial review: content + procedure
Daymond v South West Wales Authority(1976)
Claimant’s property was not connected to public sewers, but
defendants demanded charges as per their power of levying charge
Court: Ultra vires
Raymond v Honey (1983)
Prisoner posted application to court seeking order. The prison’s
governor stopped the post.
Court: Ultra vires, not enpowered to deny prisoner’s access to justice
Boddington v British Transport Police (1998)
Railway company banned smoking in trains, B refused to obey, and
was convicted. Court: the ban is legitimate!
2.3 EU law
2.3.1Primary legislation: Treaty of Rome(1957), Treaty of
Amsterdam(1999), treaty on EU
UK accession: 1973
2.3.2 Secondary legislation:
(1) regulations: directly applicable
(2) directives: not immediately binding, but require domestic legislation
in reasonable time
(3) decisions: immediately binding upon those who are addressed
2.3.3 Principal EC law making and enforcement bodies
Council of ministers: law-making power
EC: policy making powers
European parliament: consultative body
ECJ: action between commission and members; ruling on
interpretation of EC law by way of reference!
ECJ ruling binds national courts!
3 Doctrine of binding precedent and statute interpretation
3.1 Doctrine of binding precedent
3.1.1 Types of precedent
Binding precedent, persuasive precedent
(1) Ratio decidendi: reason of decision, binding
obiter dicta: other matters, not binding
(2) Material facts:
Binding: material facts must be same
Persuasive: material facts are similar
(3) Hierarchy of court
House of lords: bind all other courts
Court of appeal:
3 Court system
3.1 UK Court System
(1) single government; not federal structure
(2) courts of first instance: original jurisdiction
county court: contract and tort case less than £25000
high court: over than £50000;
shared jurisdiction: between £25000and 50000
(3) appeal to House of lords and leapfrog: permission needed
3.2 US Court System
(1) Full system of federal courts
(2) Three-tier structure: district court(first instance), court of appeals,
supreme court
(3) State level: three-tier structure in general, trial court, intermediate
appellate court, and final appellate court
(4) Federal judges are centrally appointed; many state judges are elected
by popular votes
US state court system
State Supreme Court
Intermediate appellate courts
Superior court
9 judges: 11 presidents since World War II have appointed
25 SC members, Republicans 15, Democrats 10.
3.3 Canadian Court System
◇ 4 levels of court:
○ Provincial courts, handling the great majority of cases
○ Provincial and territorial superior courts dealing with more serious
crimes and also taking appeals from provincial court judgments.
Federal Court Trial Division is on the same level responsible for
different issues.
○ Provincial courts of appeal and the Federal Court of Appeal
○ Highest level is occupied by the Supreme Court of Canada
◇ Canadian supreme court: appeals from provincial and federal system
◇ All judges are centrally appointed and paid
Canadian federal court system
Canadian supreme court
Canadian federal court
Canadian tax court
Canadian provincial court system
Canadian Supreme Court
Court of appeals
4 Legal profession
6.1 UK and US: solicitors and barristers
(1) solicitors: office lawyers
legal aspects of business and family
contracts,deeds,wills,incorporation etc.
preparation for trial: pleadings, interview,notes
appearance in some lower courts
(2) barristers: litigation lawyers
take briefs; opinions on potential litigation
6.2 Canada
(1) lawyers are both solicitors and barristers
(2) bar on provincial basis:
a must for barrister to practice law
membership in one province cannot practice in another automatically
membership in one province may appear before Supreme Court