Business Law Notes

BUSINESS LAW NOTES

THE NATURE AND CONCEPT OF LAW

• Definition of Law: "A body of rules of conduct of binding legal force and effect, prescribed, recognized, and enforced by controlling authority".
  • Enforceable body of rules that govern any society.
  • Necessary to regulate actions of citizens in any community.

Characteristics of Law

• Law consists of a body of rules made by lawmakers (e.g., Parliament, customs, or longstanding practices).
• Rules are enforced by penalties and sanctions; rules not backed by sanctions (e.g., morality) are not considered laws.
• Main aim: to set and enforce standards of behavior for peace and order.

CRIMINAL AND CIVIL LAW

• Broad Categorization: Law is divided into criminal and civil law.
  • Criminal Law: Relates to crimes (acts or omissions prohibited and punishable by law).
  • Civil Law: Pertains to rights and obligations in disputes that are not criminal in nature.

Distinctions Between Criminal and Civil Law

1. Purpose:

   • Criminal: Concerns crimes or conduct prohibited by law.
   • Civil: Concerns disputes between parties.

2. Parties Involved:

   • Criminal: State prosecutes the defendant.
   • Civil: The offended party (Plaintiff) sues the Defendant.

3. Case Titles:

   • Criminal: “State vs. Defendant” (e.g., “The Republic v. Mensah”).
   • Civil: “Plaintiff vs. Defendant” (e.g., “Nyasemhwe v. Afibiyesan”).

4. Terminology:

   • Criminal: Case, prosecution, guilty.
   • Civil: Matter, civil suit, liable.

5. Burden of Proof:

   • Criminal: Beyond reasonable doubt.
   • Civil: Balance of probabilities.

6. Consequences:

   • Criminal: Punishments (e.g., imprisonment, fines).
   • Civil: Damages, compensation, injunctions.

Overlap Between Criminal and Civil Law

• Example: A driver guilty of careless driving can be criminally prosecuted and civilly sued for compensation by the accident victim due to negligence.

SOURCES OF LAW IN GHANA

• Definition: Refers to the places from which the law can be derived.
  • Sources in Ghana (Article 11 of the 1992 Constitution):
  1. The Constitution itself.
  2. Enactments by Parliament.
  3. Orders, Rules, and Regulations made under constitutional authority.
  4. Existing law.
  5. Common law.

COMMON LAW

• At the time of the Norman conquest of England (1066), there was no uniform legal system; local customs were applied inconsistently across different regions.
• King William I established a central legal system, leading to the development of common law under Henry II, characterized by:
  • Royal commissioners administering justice uniformly.
  • Development of judicial precedent (ius commune).
• Common law distinguished from local ancestral customs, becoming the foundational legal system in England and its colonies.

EQUITY

• Definition: Body of discretionary rules and remedies based on fairness to remedy common law inadequacies.
• Emerged due to the rigidities and limitations of common law, particularly its emphasis on procedural rules and limited remedies.

Development of Equity

• Royal intervention under the Lord Chancellor, who decided cases based on fairness; led to the establishment of the Court of Chancery.
• Equitable principles included:
  • New rights, quicker procedures, and appropriate remedies (e.g., specific performance, injunction).
• Amalgamation of common law and equity through the English Judicature Acts (1873-1875). In case of conflict, equity prevails.

JUDICIAL PRECEDENT (CASE LAW)

• Definition: Body of law established by judicial decisions versus legislative statutes.
  • Precedent: Previous court decisions that future courts are bound to follow (doctrine of stare decisis).

Types of Precedent

1. Binding Precedent: Mandatory for judges to follow.
   • Usually comes from superior courts.
2. Persuasive Precedent: Influential but not binding.

Conditions for Applying Precedent

• Based on legal propositions within ratio decidendi.
• Material facts must be similar.
• Preceding court must have superior status.

Categories of Case Reports

• Ratio Decidendi: The legal reasoning for a decision forming a binding precedent.
• Obiter Dicta: Statements not essential to the decision, serving as persuasive authority but not binding.

Non-Binding Precedent Circumstances

1. Overruled by a higher court.
2. Overruled by statute.
3. Established per incuriam (through lack of care).
4. Material distinction in case facts.
5. Obscure ratio decidendi.

Advantages and Disadvantages of Precedent

• Advantages:
  • Consistency, certainty, flexibility, efficiency, formal justice.
• Disadvantages:
  • Complexity, limited discretion, possible conflicting judgments, perpetuation of unfair precedent.

THE NATURE AND MAXIMS OF EQUITY

MAXIMS OF EQUITY

1. Equity will not suffer a wrong to be without a remedy.
2. Equity follows the law.
3. Where equities are equal, the first in time prevails.
4. Where there is equal equity, the law prevails.
5. He who seeks equity must do equity.
6. He who comes to equity must come with clean hands.
7. Delay defeats equity.
8. Equality is equity.
9. Equity looks to the intent rather than to the form.
10. Equity considers it done which ought to be done.
11. Equity imputes an intention to fulfill obligations.
12. Equity acts in personam.

EQUITABLE REMEDIES

1. Quantum Meruit.
2. Specific Performance.
3. Injunction.
4. Rectification.
5. Rescission.

THE JUDICIARY IN GHANA

• Judicial Power: Vested in the Judiciary (Chief Justice is the Head; independent from the executive and legislative branches).
• Constitutional Structure:
  1. Superior Courts of Judicature:
  • Supreme Court.
  • Court of Appeal.
  • High Court.
  1. Lower Courts:
  • Circuit Courts, District Courts, Juvenile Courts, Family Tribunals, and Chieftaincy Courts.

SUPREME COURT

• Composition: Chief Justice and at least nine other Justices.
• Jurisdiction:
  • Original jurisdiction (constitutional matters, excess of powers).
  • Final appellate jurisdiction in criminal matters (e.g., treason).
  • Supervisory jurisdiction over lower courts.

COURT OF APPEAL

• Composition: Chief Justice and at least ten justices.
• Jurisdiction: Appellate jurisdiction over High Court and regional matters (excluding treason).

HIGH COURT

• Composition: Chief Justice and at least 20 Justices.
• Jurisdiction:
  • Original in almost all matters, particularly fundamental human rights.
  • Appellate jurisdiction over Circuit and District Courts.

REGIONAL TRIBUNALS

• Composition: Chief Justice, Chairman, and other members as authorized.
• Jurisdiction: Concurrent original jurisdiction with High Court in criminal matters.

CIRCUIT COURTS

• Established by Chief Justice in each region, presided by a Circuit Judge.
• Jurisdiction: Original jurisdiction in civil/criminal cases under GH¢10,000.

DISTRICT COURTS

• Composition: Presided by Magistrates appointed by the Chief Justice.
• Jurisdiction:
  • Civil: Claims up to GH¢5,000.
  • Criminal: Summary offences up to two years.

JUVENILE COURTS

• Hear cases involving individuals under the age of eighteen.

CONTRACT LAW

CLASSIFICATION OF CONTRACTS

• Contracts can be oral, written, or by deed.

TYPES OF CONTRACTS

1. Formal and Informal Contracts:

   • Formal (Specialty) Contracts: Under seal, requiring execution (signed, sealed, delivered).
   • Informal (Simple) Contracts: May be oral, written, or by implication. Not automatically void if not in writing.

2. Express and Implied Contracts:

   • Express: Terms stated in words (written or spoken).
   • Implied: Terms inferred from conduct.

3. Unilateral and Bilateral Contracts:

   • Unilateral: One party bound (e.g., reward contracts).
   • Bilateral: Both parties exchange promises.

4. Void, Voidable, and Unenforceable Contracts:

   • Void Contracts: Null from the start.
   • Voidable Contracts: Can be rescinded by one party.
   • Unenforceable Contracts: Valid but cannot be enforced due to technical issues.

FORMATION OF A CONTRACT

• Essential elements:
  1. Agreement (Offer & Acceptance).
  2. Consideration.
  3. Intention to create legal relations.
  4. Capacity (legal competence).
  5. Legality (must not contravene public policy).
  6. Form (not necessary for all contracts).

AGREEMENT AND OFFER

• Definition: An offer is a clear statement of willingness to become bound.
• Definiteness is required, as demonstrated in Gibson v. Manchester City Council (1979) (i.e., lack of intention due to the use of 'may').
• Forms of Offer: Can be personal, to groups/class, or to the public (e.g., Carlill v. Carbolic Smoke Ball Co. (1893)).

TERMINATION OF THE OFFER

• An offer must exist when an acceptance is made and may be terminated by different means (revocation, rejection, lapse of time, death).

ACCEPTANCE

• Definition: Final and unqualified agreement to the terms of the offer.
• Communication: Acceptance must be communicated to the offeror to be effective (non-instantaneous communication follows the postal rule).
  • Per Entores v. Miles Far East Corporation (1955) acceptance is effective when received.

CONSIDERATION

• Definition: The price paid by each party for the other party’s promise.
• Requirements: Consideration must be lawful, sufficient, move from the promisee, and not past (unless certain exceptions apply).

TYPES OF CONSIDERATION

1. Executed: Performed completely by the time the contract is made.
2. Executory: To be performed in the future.
3. Past: Generally not valid unless exceptions apply.

EXCEPTIONS TO PAST CONSIDERATION

• When an act is done at the request of the promisor.
• Where the parties understood that the act would be compensated.

PART-PAYMENT AND CONSIDERATION

• Under common law, part-payment does not satisfy a higher debt but exceptions allow for modified obligations in Ghanaian law under Section 8 of the Contracts Act, 1960 (Act 25).