Home > Free Essays > Law > Constitutional Law > Introduction to Business Law

Introduction to Business Law Essay

Exclusively available on IvyPanda Available only on IvyPanda
Updated: Feb 10th, 2019


Generally, statutes provide a mechanism for the legislature to ensure that citizens live and act within set legal boundaries. It thus follows that any interpretation of statutes has constitutional repercussions. Ostensibly, legal systems in the world can be classified into two general categories.

On one hand is the common law that has its origins in England while on the other hand is civil law which has its beginnings in Ancient Rome (Ahlstrom & Bruton 2009). Civil law makes use of statutes as the main building blocks and relies heavily on legal scholars to interpret legislations by Parliament. Confusion may, however, result in the event that courts are not able to determine with absolute certainty what the intention of the legislators (Corcoran & Bottomley 2005).

In a system where powers are separated, the statutory interpreter is usually different from those charged with the responsibility of enacting the statutes. Often, the interpreter is the judge while those enacting are legislators. Considering that differences in perspectives are very common, dynamic interpretation may be experienced time and again. Ostensibly, statutory interpretation is a vital judicial tool that has been used by judges for many years to safeguard basic rights in the common law. Seemingly, the different stages involved in the creation of a statute often ensure that errors are addressed in good time (Kafaltiya 2008, p. 108).

Customarily, judges use different strategies when interpreting statutes. No guidelines exist and there is no commonly accepted standard of interpretation. This notwithstanding, there are basic principles that must be adhered to by judges as they interpret legislations. According to Sadurski (2002, p. 67), courts sometimes make efforts to interpret legislations in a way that is consistent with human rights. In some situations, legislatures endorse customs that may be used by courts during interpretation.

Powers Available to Courts in Connection with Statutory Interpretation

In England and Wales, the interpretation of statutes is a privilege accorded to courts and tribunals. A team of highly skilled people is charged with the responsibility of drafting statutes on behalf of the legislature before they can be passed to the courts for interpretation.

However, there are challenges that result from the fact that those who draft the statutes may not be able to address every possible situation that may be encountered at a later time (Adams 2012, p. 23). It is also possible that the process may be so rushed to an extent of leaving out important details in a given legislation.

As stated earlier, the principles that govern statutory interpretation are not well organized and the whole process of interpretation is largely controlled by the common law. Allegedly, this creates room for any new developments to be undertaken by courts in order to deal with new problems as they arise. As a result, it is assumed that statutes provide a clear indication of what judges actually mean (Adams 2012, p. 57). Judges provide interpretations based on what is presented to them and as such meet the expectations of the legislators.

Evidently, judges are not allowed to rewrite any statutes and are required exercise their powers in a modest manner. There are, however, some cases where a judge may not be able to tell what the intentions of the legislators are. The language used by Parliament may, for example, lead to a situation where judges give an interpretation that is totally different from what was originally meant.

To understand the intentions of Parliament and thus avoid the language confusion, it is advisable for the court to read the entire statute and give the correct meaning to every word in it. The limited class rule is sometimes used to provide a general interpretation of a word. As the courts are simply required to interpret and not re-write legislations, it is impossible for the judges to fill up any gaps left by the legislative body. Courts may, however, overcome such challenges by carefully interpreting legislations.

According to Sarat (2008, p. 251), it is absolutely impossible to come up with a statute that covers all possible issues that may be encountered in relation to it. As a result, courts may be faced with serious challenges when conditions change. Since courts can not fill legislation gaps, they are limited to determining whether a statute is applicable in a case where circumstances are deemed to have changed.

The courts may also be allowed to take into consideration the deliberations of the legislators prior to passing a Bill. Reference to such deliberations during statutory interpretations was, however, not allowed in England and Wales until 1993. Regrettably, there are limitations to this strategy as it may not be applicable in situations where it can be determined that conditions have changed drastically.

According to Amar (2012, p. 341), the limitation imposed on courts regarding the application of statutes in changed circumstances is largely responsible for the delays experienced in dealing with such cases. It is thus imperative to establish mechanisms of speeding up the process.

Engagement of Judicial Precedent with Statutory Interpretation

A precedent may be defined as a past event. Legally, it serves as an important guide for judges. Judicial precedent is a vital part of the common law system according to which a judge is required to make a ruling on a case guided by an earlier decision in a similar case.

Under the common law system, legal precedent plays a big role and judges have the freedom to interpret a law and provide a basis on which future cases may be heard and decided (Ahlstrom & Bruton 2009). In comparison to other countries, the legal system in the United Kingdom follows the requirements of judicial precedent very strictly. Practically, lower courts are required to abide by a past ruling of a superior court in interpreting statutes.

The appellate court on the other hand is expected to abide by its past rulings in similar cases. Arguably, the doctrine of judicial precedent provides for either binding or persuasive precedent. While binding precedent is mandatory and must be adhered to by lower level courts, persuasive precedent serves as an important guide for judges when deciding on similar cases.

Apparently, questions about judicial precedent tend to concentrate more on the way the doctrine works or operates. To a large extent, the fact that cases may be considered retrospectively implies that judges have the flexibility to use judicial precedent to interpret statutes (Mitchell & Dadhania 2003). In the event that a judge comes across a case where a relevant previous ruling made by the court exists, the judge has four possibilities.

He or she may follow the earlier judgment if it is clear that the facts in the current and previous case are similar, make a distinction if it is established that the facts are completely different, overrule the earlier decision in case there is a disagreement with the decision arrived at by a lower court, or reverse the previous ruling by a lower court if an appeal is made and the higher court can determine that the lower court failed to interpret the law correctly.

There are several advantages that may be associated with the application of judicial precedent in statutory interpretation (Schyff 2010, p. 51). First, there is consistency in the application of the law and this provides a sense of equality and justice. Secondly, there is certainty considering that many cases exist that have been dealt with before and this enables lawyers to advice their clients with confidence. Finally, the options made available to judges create room for fair application and further development of the law.

There are, however, some difficulties associated with the use of judicial precedent in statutory interpretation. First, the use of judicial precedent is quite rigid and limits judicial discretion. There is also a danger of slowing down the judicial process as judges are expected to spend quite some time perusing previous cases. It may also lead to the creation of illogical distinctions by judges who may not be willing to follow an existing precedent. Finally, the court has no choice but to rely upon a suitable case where changes to the law have to be made.


As has been explained in this paper, statutory interpretation is a vital tool for preserving fundamental rights that affect our day to day lives. While judges have the leeway to interpret legislations as they see fit, they can only do so within certain limits. In the event that powers are separated, there is a danger that the legislations may be poorly interpreted.

Whilst many options exist for interpreting statutes, the most commonly used is judicial precedent. As a source of law, judicial precedent allows judges to make reference to past judgments and apply the reasoning used if circumstances of the cases involved are similar.

Reference List

Adams, A 2012, Law for Business Students, Pearson Publishing, Edinburgh Way, Harlow.

Ahlstrom, D & Bruton, G 2009, International Management: Strategy and Culture in the Emerging World, Cengage Learning, Mason, OH.

Amar, AR 2012, America’s Unwritten Constitution: The Precedents and Principles We Live by, Basic Books, New York.

Corcoran, S & Bottomley, S 2005, Interpreting Statutes, Federation Press, Sydney, Australia.

Kafaltiya, AB 2008, Interpretation of Statutes, Universal Law Publishing, New Delhi.

Mitchell, AR & Dadhania, M 2003, As Level Law, Psychology Press, Hove, United Kingdom.

Sadurski, W 2002, Constitutional Justice, East and West: Democratic Legitimacy and Constitutional Courts in Post-Communist Europe in a Comparative Perspective, Kluwer Law International, The Hague, Netherlands.

Sarat, A 2008, Constitutional Politics in a Conservative Era, Emerald Group Publishing, West Yorkshire, UK.

Schyff, G 2010, Judicial Review of Legislation: A Comparative Study of the United Kingdom, the Netherlands and South Africa, Springer, New York.

This essay on Introduction to Business Law was written and submitted by your fellow student. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly.
Removal Request
If you are the copyright owner of this paper and no longer wish to have your work published on IvyPanda.
Request the removal

Need a custom Essay sample written from scratch by
professional specifically for you?

801 certified writers online

Cite This paper
Select a referencing style:


IvyPanda. (2019, February 10). Introduction to Business Law. https://ivypanda.com/essays/introduction-to-business-law/


IvyPanda. (2019, February 10). Introduction to Business Law. Retrieved from https://ivypanda.com/essays/introduction-to-business-law/

Work Cited

"Introduction to Business Law." IvyPanda, 10 Feb. 2019, ivypanda.com/essays/introduction-to-business-law/.

1. IvyPanda. "Introduction to Business Law." February 10, 2019. https://ivypanda.com/essays/introduction-to-business-law/.


IvyPanda. "Introduction to Business Law." February 10, 2019. https://ivypanda.com/essays/introduction-to-business-law/.


IvyPanda. 2019. "Introduction to Business Law." February 10, 2019. https://ivypanda.com/essays/introduction-to-business-law/.


IvyPanda. (2019) 'Introduction to Business Law'. 10 February.

Powered by CiteTotal, online essay citation creator
More related papers