Business Law Defined.
Also known as mercantile law or commercial law, it covers the dealings between people in commercial matters. Mercantile law is classified into two whereby we have regulation of commercial entities by the laws of partnership, company, agency and bankruptcy and secondly the regulation of commercial transaction by laws of contract and related field.
Each business is referred to as a legal entity in the eyes of the law and as we know there are various types of business ranging from registered multinational corporations which are limited liability companies to sole trader businesses in which the owner solely carries the responsibility of running the business as well as the risk of loss and the gains arising from profits.
Another form of business entity is a partnership in which two or more members come together to form a business with each and every one of them baring the risk and responsibility of running the business, debts, lawsuits and profit sharing according to the business contractual agreement. All partners are each others agent.
According to business law there are various forms of agencies including universal agency where all the affairs of the principal are handled by the agent, special agent in which an agent is given limited powers to carry out a particular task and finally we have a general agent who represents his/her principal in all businesses of a certain kind.
This occurs in instances whereby business entities are incapable of carrying out their financial obligations. If it happens that the entity cannot pay its debts, in other words, becomes insolvent, its creditors or the business entity may petition the court to take charge of administering its estate and to equally distribute it among the creditors. In this case, the court acts to know the reason for insolvency and to free the entity from its debt.
An agreement between two or more people involving the exchange of goods and services for a price is legally binding and enforceable by the law. This agreement can either be written or oral. For this agreement to be binding there must be an offer, acceptance, valuable consideration, absence of fraud and intention to create legal relations. The terms of the agreement must also be possible to execute, certain and legal. Commercial law touches an everyday life through contractual agreements and as a result, there has been the development of business laws regulating; sale of goods, carriage of goods, consumer credit agreements and labour relations, for more information, visit www.ndandp.co.uk.
Due to technological developments, the business law has been evolving over time.