Understanding Business Law

What is a Business?

A business is anything that is entitled to employ an individual. A business can occupy time, attention and labor of an individual with an eye on earning a livelihood or making a profit. Involvement in a single activity related to a particular business is not considered to be engaging in the business as only a series of activities is considered to be engaging in business.

The words business, labor, and work should not be used interchangeably as these never have the same meaning. Engaging in a business is not always considered labor, though labor can be business.

What is Law?

A law is defined as an enforced and recognized principle, violation of which results in a penalty in terms of pain, injury, loss or failure. Laws are obligatory rules related to the conduction of business and individuals. These are formulated and enacted to remind a business or an individual of duty or obligation and enforce justice.

A law is mainly derived from custom or formal enactment by anyone in power within the area, including a ruler or a legislature. Laws carry a sense of power and authority of those who enact it and make anyone subject to penalties in the event of a violation by the person.

Laws become legitimate from being founded on universally accepted principles such as justness of each law or the sovereign power enacting them. Laws establish and describe the direct connection between the causes and effects of phenomena, largely derived from experiments or observations.

The term ‘Law’ includes the following examples:

  • Business proprietors are obliged to follow all laws and regulations to avoid issues and penalties
  • Visitors and vacationers from other counties should respect local laws

Business Law and Legal Definition

Business laws refer to a group of rules designed to govern the dealings between companies or individuals involved in commercial transactions. Business laws can be passed by:

  • Convention
  • Agreement 
  • National or international legislation

This aspect of the law is about duties, legal rights and liabilities of individuals or companies involved in commercial matters related to sales, commerce, trade and merchandising. Business laws, as a stream of civil laws, include both public and private laws. Business laws may have regulations over the following legal aspects:

  • Banking
  • Partnership
  • Carriage by land or sea
  • Guarantees and Indemnity
  • Insurance (life, marine, fire or accident)
  • Relationship between principal and agent

Violation of law also includes laws related to agency and employment, business organizations, property, commercial papers, contracts, sales and bailments. You might face business laws while dealing with consumer protection, creditors, insurance or estate or will planning. Other examples encompass starting, purchasing, managing contractors, working with employees or selling a business.

Business laws have two main areas as follows:

  • Regulation of agency, partnership and bankruptcy and company laws for commercial establishments
  • Commercial law regulation for commercial transactions

Commercial laws, in countries having civil laws, encompass statute laws and in countries having common laws, combine equity and statute laws. Under business laws, the two major legal concepts are the idea of legal personality and the theory of limited liability.

Considering that business laws have multiple layers of complexities, you should hire a good business lawyer in Warren before starting a business in order to avoid legal issues.

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