CAVENDISH lawcards series® Business Law Second Edition Cavendish Publishing Limited .......................... London • Sydney Second edition first published in Great Britain 2002 by Cavendish Publishing Limited, The Glass House, Wharton Street, London WC1X 9PX, United Kingdom Telephone: +44 (0)20 7278 8000 Facsimile: +44 (0)20 7278 8080 Email:
[email protected] Website: www.cavendishpublishing.com © Cavendish Publishing Limited 2002 First edition 1999 Second edition 2002 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except under the terms of the Copyright Designs and Patents Act 1988 or under the terms of a licence issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London W1P 9HE, UK, without the permission in writing of the publisher. British Library Cataloguing in Publication Data Business law—2nd ed—(Law cards) 1 Business law—Great Britain 346.4'2'07 ISBN 1 85941 717 5 Printed and bound in Great Britain Contents 1 Sources of law 1 2 European Union law 7 3 Alternative dispute resolution 9 4 Contract 13 5 Contents of contracts 25 6 Vitiating factors in contract 33 7 Discharge of contracts 43 8 Agency 51 9 Partnership law 57 10 Company law 63 11 Negligence 85 12 Employer’s liability 93 13 Individual employment rights 1 97 14 Individual employment rights 2 117 15 Consumer credit 131 16 Sale of goods 137 iii 1 Sources of law Legislation: law produced by Parliament There are five stages, in each House of Parliament (Commons and Lords), through which a Bill must pass in order to become law: (a) (b) first reading; second reading; (c) (d) committee stage; report stage; (e) third reading. Then it is given royal assent. The House of Lords has limited scope to delay legislation. Delegated legislation: power delegated by Parliament to others to make law Types of delegated legislation include: (a) (b) Orders in Council; statutory instruments; (c) (d) bylaws; professional regulations. 1 2 CAVENDISH L AWCARDS Controls Ultra vires means that the party to whom power was delegated has exceeded their authority. Case law Law created by judges in the course of deciding cases. Stare decisis Binding precedent: courts are bound by the previous decisions of courts equal or above them in the court hierarchy (see below, p 4). BUSINESS L AW 3 The House of Lords can overrule its previous decisions (Practice Statement (1966)); lower courts, including the Court of Appeal, cannot, except in special circumstanc