As defined by Steven J. Skinner and John M. Lvanncevich, A law is a standard or rule established by a society to govern the behavior of its members. Federal, state, and local governments, constitutions, and treaties all establish laws. Laws have a direct and substantial impact on how business firms conduct various activities. Law, as it is, is the command of the Sovereign. It means, law has its source in sovereign authority; which is accompanied by sanctions, and the command to be a law should compel a course of conduct. Being a command the law must flow from a determinate person or group of persons with the threat of displeasure if it is not obeyed. Thus the term Law is used to denote rules of conduct emanated from and enforced by the state. The laws of a country relate to many subjects, e.g., inheritance and transfer of property, relationship between persons, crime and their punishments, as well as matter relating to industry trade and commerce. The term Business Law is used to rules and regulations relating to industry trade and commerce. There are several sources of law. The bodies of law created by judges through their court decisions are common laws. As a body, the laws enacted by the local governments, constitutions or treaties are statutory law. Moreover, there are administrative laws and judicial laws.
2.Various categories of Business Law
Numerous and several types of laws regulate the activities of all businesses and everyone involved in the business, from owner to manager to employees. These include –
•Tort law (which includes product liability),
•Laws governing contractual agreements,
•Use of agents,
•Bankruptcy proceedings, and
3.Laws that affect business in Bangladesh
It is important for all business owners to know and understand the laws that affect their businesses. It is equally important to comply with those laws. Ignorance of the laws has never been a valid excuse in any Court of Law, and it never will be. As a business owner, it is owner’s responsibility to know what laws affect the business. Business Law may be defined as that part of law which regulates the transactions of the mercantile community. The scope of commercial law is large. It includes the laws relating to contract, partnership, negotiable instruments, sale of goods companies etc. It is noted that there is no fixed line of division between commercial law and other branches of law, nor is there any conflict or contradiction between them. The law of contract, which is a very important part of commercial law, is applicable not only to merchants and bankers but also to other persons. Commercial law deals with only those parts of law which are of special importance to the mercantile community. The same laws are applicable to other citizens under appropriate circumstances.
4.The Law of Contract
The Law of Contract deals with agreements which can be enforced through courts of law. The Law of Contract is the most important part of commercial law because every commercial transaction starts from an agreement between two or more persons. An agreement enforceable by law is a contract. Therefore in a contract there must be an agreement and the agreement must be enforceable by law. The objective of The Law of Contract is to introduce definiteness in commercial and other transactions.
The contract Act, 1872 covers most of the laws of contract. It includes total eleven chapters with lots of clauses. An overview of the laws has been enclosed in Appendix. Few of the details of the elements of the acts are described in the following page.
4.1 The essentials elements of a Contract
An agreement becomes enforceable by law when it fulfills certain conditions. In this context, there are several laws which uphold the terms and conditions for legal steps...