asm2-BL - p3

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ASM2 BL Group 1
Law for Business (Trường Đại học FPT)
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ASSIGNMENT 2 FRONT SHEET
Qualification BTEC Level 4 HND Diploma in Business
Unit number and title Unit 7 Business Law
Submission date 15/4/2023 Date received (1st submission) 15/4/2023
Re-submission date Date received (2nd submission)
Student names & codes Final scores Signatures
1. Phùng Hồng Anh bh00118 Hồng Anh
2. Lý Thị Nguyệt Nguyệt

Group number:
3. Nguyễn Thanh Huệ Huệ
4. Phùng Hồng Ánh bh00119 Ánh
Class BA0502 Assessor name Nguyen Thu Hien
Student declaration
I certify that the assignment submission is entirely my work and I fully understand the consequences of plagiarism. I understand that making a false
declaration is a form of malpractice.

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Grading Grid
P3 P4 P5 P6 M2 M3 M4 D2 D3

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Table of Contents
I. Introduction ...................................................................................................................................................... 11
II. Use specific examples, and illustrate how the company, employment, and contract law has a potential
impact on business (P3) ....................................................................................................................................... 11
2.1. Contract law .............................................................................................................................................. 11
2.2. Employment law ....................................................................................................................................... 12
2.3. Company law ............................................................................................................................................. 13
III. Explore how different types of business organizations are legally formed. Present different types of
organizations/companies as after (P4) ................................................................................................................ 15
3.1. Sole Proprietorship ................................................................................................................................... 15
3.2. Partnership ................................................................................................................................................ 16
3.3. Limited Liability Company (LLC) ................................................................................................................ 17
3.4. Joint Stock Company ................................................................................................................................. 19
IV. Explain how business organizations are managed and funded as followings: (P5) ........................................ 20
4.1 How business organizations are managed ................................................................................................. 20
4.1.1 Roles of a Shareholder ........................................................................................................................ 20
4.1.2 Duties of Directors .............................................................................................................................. 21
4.1.3 Roles, duties, and qualification of Secretary ....................................................................................... 22
4.1.4 Functions and powers of Auditors ...................................................................................................... 24
4.2 How business organizations are funded .................................................................................................... 26
4.2.1 Bonds .................................................................................................................................................. 26
4.2.2. Stock ................................................................................................................................................... 28
V. Compare and contrast different sources of legal advice and dispute resolution assistance to make
appropriate recommendations on legal solutions: (P6) ...................................................................................... 29
5.1 Alternative Dispute Resolution (ADR) ........................................................................................................ 29
5.1.1 Tribunals.............................................................................................................................................. 29
5.1.2 Arbitration ........................................................................................................................................... 30
5.1.3 Mediation ............................................................................................................................................ 31
5.1.4 Ombudsman ........................................................................................................................................ 33
5.1.5 Conciliation ......................................................................................................................................... 34
5.1.6 Negotiation ......................................................................................................................................... 35
5.2. Civil litigation procedures (court) .............................................................................................................. 36

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5.2.1. Definition ........................................................................................................................................... 36

5.2.2. Advantages ......................................................................................................................................... 37
5.2.3. Disadvantages .................................................................................................................................... 38
5.3. The role of unions ..................................................................................................................................... 38
5.3.1. Definition ........................................................................................................................................... 38
5.3.2 Advantages .......................................................................................................................................... 40
5.3.3 Disadvantages ..................................................................................................................................... 40
VI. Conclusion....................................................................................................................................................... 40
VII. References ..................................................................................................................................................... 40

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I. Introduction
We work as the worldwide investment fund Dragon Capital's legal consultants. The business plan for
my company calls for investments in Vietnam, a new market, as well as the UK. To understand how
businesses in Vietnam adhere to contract law, employment law, and company law, I researched how
they have dealt with various scandals, legal issues, and conflicts relating to these laws. Specific
illustrations of company law, labor law, and contract law will be provided as part of the core topic,
along with an explanation of how various business structures operate. Resources for legal counsel and
dispute resolution support should be compared.
II. Use specific examples, and illustrate how the company, employment, and contract law has a
potential impact on business (P3)
2.1. Contract law
History of the case
On February 1st of 2013, NH Private Enterprise (A) and the Joint Stock Company associated with Thai
Nguyen Joint Stock Company signed Economic Contract No. 06/XNCD-KC/2013 (B). As a result, Party A
paid Party B a temporary sum of VND 1,564,200,000 to produce and construct the basement wind
tunnel B1 of the Times City building, located in the HBT district of Hanoi. The provisions of the contract
specifically outline each party's obligations and the means of payment. The project's construction was
finished by June 2013, and both parties had signed a record of acceptance. The two parties recorded
the contract's liquidation on August 18, 2013, and the minutes' contents are as follows: The contract's
actual worth is VND 1,247,083,200, and Party B offers a long-term warranty on the work. 12 months
after Party A signs the minutes of the handover. B is given the sum of 1,247,083,200 VND by Party A.
Party A has advanced VND 490,000,000, withholding VND 62,354,160 for the warranty payment, and
leaving VND 694,729,040 to be paid in full to the College of Business by bank transfer. January 2, 2013,
contract number 06/XNCD-KC/2013 expires from the date of execution and is liquidated after Party A
has paid Party B the full amount due. Party A did not, however, follow through on its promise. The NH
Private Enterprise's director, Mr. H, pleaded for money several times in response to the Union
Enterprise's repeated demands, which prompted the Enterprise to launch a case in court. The
Community Enterprise is now requesting that the Court order Mr. Nguyen Quoc H, the director of the
NH Private Company, to pay the remaining balance of VND 339,452,200 of the principal and interest
due under the law. The amount still owing is 339,452,200 VND (NH has paid an extra 65,000,000 VND
after initiating a lawsuit; the total now stands at 369,452,200 VND).

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Sentence
Accepting the petition of a legal action brought by Thai Nguyen Joint Stock Company - Community
Enterprise against NH Private Enterprise about Economic Contract no 06/XNCD-KC/2013, which was
signed on February 1, 2013, and concerns the creation and installation of wind ditches. requiring the
private company to transfer 456,987,524 VND to the Thai Nguyen Joint Stock Corporation - Community
Enterprise. According to the economic contract No. 06/XNCD-KC/2013, which was signed on January
2, 2013, the profit is 117,535,324 VND and the principal is 339,452,200 VND. The judgment debtor will
also be required to pay a penalty for late payment, which is equal to the amount of the late payment
multiplied by the number of days the payment was late and multiplied by 150% of the loan interest
rate since the judgment becomes legally binding if the judgment creditor submits a written request for
judgment enforcement but the judgment debtor has not yet paid.
Rulings made by the court

Thai Nguyen Joint Stock Corporation - Community Enterprise must receive payment from private
company NH in the amount of 130,000,000 VND, or even 130,000,000 VND.
Effect of legal issues on the Company's Business
● Aspects of the economy: The banking company must pay back the debt and make up for any
harm done to the joint venture company.
● The two parties' relationship is strained, and NH companies risk losing one cooperating partner.
● It will be challenging to cooperate with other businesses to collaborate in the future since the
bank's commercial reputation is impacted by its history of bad debt.
2.2. Employment law

History of the case
The human resources division verbally told Ms. A at the end of August 2020 that she would be leaving
her position on August 31, 2020, albeit the cause wasn't disclosed. Company B issued decision No.
82/QDCDHD/LD/2020 to end the employment agreement with Ms. A on August 31, 2020. Ms. A filed a
case to ask the court to settle after realizing that Business B was breaking the law by unilaterally
terminating the labor contract it had with her.
Decisions of the court

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In November 2019, A and firm B agreed to an indefinite-term employment agreement with a monthly
wage of VND 4,695,000. On August 31, 2020, Company B let Ms. A resign from her position but failed
to justify, in violation of Labor Code articles 38 and 41. As a result, Company B must compensate D by
the guidelines of Article 42 of the Labor Code. Ms. A's request for compensation complies with Article
42 of the Labor Code and is advantageous to Company B. As a result, it's essential to compel
Corporation S to pay Ms. A for the following things:
● It will cost 3,028,275 VND to compel firm B to give Ms. A the additional benefits required by law
(social insurance, health insurance, and unemployment insurance) for the time frame of
September 1 through November 30, 2020.
● From September 1, 2020, to November 30, 2020, Ms. A will receive a salary and allowance of
14,085,000 VND each day.
● According to Section 1 of Article 42 of the Labor Code, two months' pay is compensated with
VND 9,390,000.
● According to Section 3, Article 42 of the Labor Law, the additional payment for two months of
wage is VND 3,390,000.
● 7,042,500 VND will be awarded as compensation for notice period violations.
Effects of legal issues

● Aspects of the economy: Business B must pay Ms. A's full salary and insurance coverage in line
with regulations, and must also pay salary compensation by the law.
● The two parties' connection is strained.
● Due to its negative reputation for treating employees unfairly, Company B's reputation suffers
financially and it is challenging to attract talent.
2.3. Company law

Case background
"Mr. C is a member of TB Tile Manufacturing One Member Limited Company (TB Company). On January
29, 2018, Mr. C contributed capital to the Company with an amount of VND 500,000,000, equivalent
to 5 % of total charter capital, profits are divided according to the capital contribution ratio. However,
from the day, he contributed capital to the Company until now, the Company has never held a meeting
of capital contributors to discuss and announce the results. Mr. C asked the Director of the Company,
Mr. Nam when dividing the profits, Mr. Nam promised to share until April 2019. But after this time, he

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still did not see the division. Mr. C saw the company's business. The company was not clear, so he asked
to withdraw capital On May 3, 2019, Mr. C and the Company made minutes of agreement with the
content that TB Company returned to him 500,000,000 VND of contributed capital, 50,000,000 VND
per month, the period of 10 months from the date of payment. May 15, 2019, to February 15, 2020, is
the end. On May 15, 2019, the Company has paid Mr. C 50,000,000 VND and since then the Company
has not refunded the amount as promised.”
Sentence
● Accept all requests of Mr. Do Van C.
● Forced XH Tile Production Co., Ltd (now TB Brick and Tile Manufacturing Co., Ltd.) to be obliged
to pay Mr. Do Van C 516,977,200 VND (In which there is 460,000,000 VND in principal and
56,977,200 VND). profit) do it once.
The judgment debtor shall pay interest on the outstanding judgment debt at the rate specified by law
beginning the day after the first-instance trial and continuing each month afterward until the execution
of all sums of money. Article 468, Section 2, of the 2015 Civil Code. The first-instance judgment also
makes decisions about court fees, the ability to appeal, and the legality of the judgment's enforcement.
The defendant, TB Brick Production Limited Liability Company, filed an appeal on December 16, 2020,
claiming that he had not consented to give Mr. Do Van C. a lump sum payment and interest.
At the appellate court:
● The appellant upheld the appeal.
● The procurator participating in the appellate court session expressed the following opinions:
The judge, the court clerk, and other participants in the proceedings have strictly complied with
the provisions of the Civil Procedure Code. Regarding the content of the case, it is proposed
that the appellate trial panel did not accept the appeal and uphold the first-instance judgment.
Rulings made by the court

By Clause 1 of Article 308 of the 2015 Civil Procedure Code, the People's Court of Binh Dinh Province
upholds the first-instance commercial business judgment No. 01/2020/KDTM-ST dated December 16,
2020, and rejects the appeal of XH brick and tile production limited liability company (now TB brick and
tile production limited liability company), whose legal representative is Mr. Nguyen XT.
Effects of legal issues

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● Aspects of the economy: Mr. C must receive the whole principal and interest from XH Brick
Production Co., Ltd.
● Damage has been done to the two parties relationship.
● Due to XH Co., Ltd.'s diminished reputation, it is challenging for the business to get new
investors.
III. Explore how different types of business organizations are legally formed. Present different types
of organizations/companies as after (P4)
Definitions
Limited liability and unlimited liability is the mode (form) of liability for the assets and liabilities in the
business activities of the enterprise
Limited Liability: The owner is only responsible for the business activities of the business to the extent
of the contributed capital. Specifically, when an enterprise is dissolved or goes bankrupt, the owner
and business capital contributors only have to pay debts up to the amount of capital contributed to the
company.
Unlimited Liability: The owner is responsible for the business activities of the business to the extent of
his contributed capital and personal property. Specifically, when an enterprise is dissolved or goes
bankrupt, the owner and capital contributors must pay debts equal to the amount of capital
contributed to the enterprise. If not yet fully paid, the owner or the business capital contributor must
use their property to pay.
The legal status is the status of an organization that is granted by the state to perform certain rights
and obligations independently and to be responsible before the law.
3.1. Sole Proprietorship

Numbers of owners/founders: A sole proprietorship is an enterprise owned by an individual who is
solely responsible for all his/her assets for all activities of the business.
Liabilities of members: The owner of a sole proprietorship has unlimited liability for all debts incurred
during the operation of the sole proprietorship. A private enterprise may not contribute capital to the
establishment, purchase shares, or capital contribution in a partnership, limited liability company, or
joint-stock company and may not issue any type of securities
Each individual is only entitled to establish a private enterprise.

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Legal entity status: A private enterprise has no legal standing, which means that its assets are not
separate from those of the business owner and cannot engage in legal relationships on its own.
Advantages:
- The owner of a Private Business, as there is only one owner, has full ability to decide all
business-related issues.
- Due to the limitless liability framework that serves as a guarantee for business partners and
financial institutions to work with firms, private businesses are less constrained by the law.
- The corporate organizational structure is straightforward and condensed.
- Trust is built with partners and clients of Private Enterprises thanks to the unlimited liability
mode.
Disadvantages:
- Due to his unrestricted liability with his assets during business operations, a sole proprietorship
owner is always at risk.
- The owner of the investment business is still entirely responsible for the day-to-day
management of the business, even if you employ a director to do so. 2023) (Twin, Sole
Proprietorship: What It Is, Pros & Cons, Examples, Differences from an LLC)
3.2. Partnership
Numbers of owners/ founders:
- A partnership is an enterprise in which at least two members are joint owners of the company,
doing business together under a common name (called general partners).
- In addition to general partners, there may be capital contributors (capital contributors are not
allowed to participate in company management and business activities on behalf of the
company).
Liabilities of members: General partners must be individuals, responsible with all their assets for the
obligations of the company. Capital contributors are only liable for the debts of the company to the
extent of the amount of capital contributed to the company. A partnership may not issue securities of
any kind.
Legal entity status: The partnership company has legal status from the date of issuance of the
Certificate of Business Registration.
Advantages:

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- Many different people's reputations come together to form a relationship. The partnership
corporation can over the trust of its clients and business associates thanks to the general
partners' cooperative and unlimited liability regime.
- Because there are few members and they are all respectable individuals who have complete
confidence in one another, partnership management is not overly difficult.
Disadvantages:
- The level of risk for general partners is quite high as a result of the unlimited liability regime.
- The Law on Companies from 2005 specifies the type of partnership, however, in actuality, this
kind of business is uncommon. (Kopp, Partnership: Definition, Function, Taxation, and Types
2023)
3.3. Limited Liability Company (LLC)

Numbers of owners/ founders:
- Limited liability companies include single-member limited liability companies and limited
liability companies with two or more members.
- A limited liability company with two or more members is an enterprise with between 02 and 50
members who are organizations and individuals.
Liabilities of members:
- To the extent of their capital contributions to the business, members are responsible for the
debts and other property responsibilities of the company.
- Up to the amount of charter capital, the firm owner is liable for all debts and other property
responsibilities.
Legal entity status: According to enterprise law, a limited liability corporation is a specific kind of
business having legal recognition. A separate legal entity exists between the business owner and the
business. Since the date the certificate of enterprise registration was issued, the company has been
legally recognized before the law. The owner of the company is a natural person with legal obligations
and rights that are in line with their ownership stake in the business.
Advantages:
- Fewer corporate formalities. Corporations must hold regular meetings of the board of directors
and shareholders, keep written corporate minutes and file annual reports with the state. On
the other hand, the members and managers of an LLC need not hold regular meetings, which
reduces complications and paperwork.

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- No ownership restrictions. S-corporations cannot have more than 100 stockholders, and each
stockholder must be a natural person who is a resident or citizen of the United States. There
are no such restrictions placed on an LLC.
- Ability to use the cash method of accounting. Unlike a C-corporation, which often must use the
accrual method of accounting, most limited liability companies can use the cash method of
accounting. This means that income is not earned until it is received.
- Ability to place membership interests in a living trust. Members of an LLC are free to place their
membership interests in a living trust. It is difficult to place shares of an S-corporation into a
living trust.
- Ability to deduct losses. Members who are active participants in the business of an LLC can
deduct its operating losses against the member's regular income to the extent permitted by
law. Shareholders of an S-corporation are also able to deduct operating losses, but shareholders
of a C-corporation are not.
- Tax flexibility. By default, LLCs are treated as a "pass-through" entity for tax purposes, much
like a sole proprietorship or partnership. This means that LLCs avoid double taxation.
Furthermore, an owner of an LLC is not required to pay unemployment insurance taxes on his
or her salary. However, an LLC can also elect to be treated like a corporation for tax purposes,
whether as a C-corporation or an S-corporation.
Disadvantages:
- Profits subject to social security and Medicare taxes. In some circumstances, owners of an LLC
may end up paying more taxes than owners of a corporation. Salaries and profits of an LLC are
subject to self-employment taxes, currently equal to a combined 15.3%. With a corporation,
only salaries (and not profits) are subject to such taxes. This disadvantage is most significant for
owners who take a salary of less than $97,500 for the tax year 2007.
- Owners must immediately recognize profits. A C-corporation does not have to immediately
distribute its profits to its shareholders as a dividend. This means that shareholders in a C-
corporation are not always taxed on the corporation's profits. Because an LLC is not subject to
double taxation, the profits of the LLC are automatically included in a member's income.
- Fewer fringe benefits. Employees of an LLC who receive fringe benefits, such as group
insurance, medical reimbursement plans, medical insur, ance, and parking, must treat these
benefits as taxable income. The same is true for employees who own more than 2% of the

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corporation. However, employees of a C-corporation who receive fringe benefits do not have
to report these benefits as taxable income
3.4. Joint Stock Company

Numbers of owners/ founders: A joint-stock company is an enterprise in which the charter capital is
divided into equal parts called shares. Shareholders can be organizations or individuals; The minimum
number of shareholders is three and there is no limit to the maximum number.
Liabilities of members:
- The liability regime of a joint stock company is a limited liability
- The company will be responsible for all company assets.
- Shareholders are responsible for debts equal to the amount of capital contributed to the
company.
Legal entity status:
As of the day the Certificate of Business Registration was issued, a joint-stock corporation was legally
recognized. For its debts, the business is liable. Depending on the circumstances, the business may file
a lawsuit or defend itself in court. The business is entitled to possess its property. Ownership of the
company's assets is not permitted; only its shares may be owned.
Advantages:
- One of the biggest drawing factors of a joint stock company is the limited liability of its
members. Their liability is only limited to the unpaid amount on their shares. Since their wealth
is safe, they are encouraged to invest in joint stock companies
- The shares of a company are transferable. Also, in the case of a listed public company, they can
be sold in the market and be escorted to cash. This ease of ownership is an added benefit.
- Perpetual succession is another advantage of a joint stock company.
Death/Retirement/insanity/etc does affect the life of a company. The only liquidation under
the Companies Act will shut down a company.
- A company hires a board of directors to run all the activities. Very proficient, talented people
are elected to the board, and this results in effective and efficient management. Also, a
company usually has large resources and this allows them to hire the best talent and
professionals.
Disadvantages:

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- One disadvantage of a joint stock company is the complex and lengthy procedure for its
formation. This can take up to several weeks and is a costly affair as well.
- According to the Companies Act, 2013 all public companies have to provide their financial
records and other related documents to the registrar. These documents are then public
documents, which any member of the public can access. This leads to a complete lack of secrecy
for the company.
- And even during its day-to-day functioning a company has to follow several laws, regulations,
notifications, etc. It not only takes up time but also reduces the freedom of a company
- A company has many stakeholders like the shareholders, the promoters, the board of directors,
and the employees. the debenture holders etc. All these stakeholders look out for their benefit
and it often leads to a conflict of interest.
IV. Explain how business organizations are managed and funded as followings: (P5)
4.1 How business organizations are managed
A company's organizational management is a culmination of its various leadership facets. Following the
implementation of a plan, the organization's management must keep an eye on the situation and
modify the course of action as necessary. Utilizing several corporate leadership tiers to create
objectives, track performance, and fortify businesses is the aim of organizational management.
4.1.1 Roles of a Shareholder

Definition: A shareholder can be a person, company, or organization that holds stock(s) in a given
company. A shareholder must own a minimum of one share in a company’s stock or mutual fund to
make them a partial owner. Shareholders typically receive declared dividends if the company does well
and succeeds. If the company is getting liquidated and its assets are sold, the shareholder may receive
a portion of that money, provided that the creditors have already been paid. When such a situation
arises, the advantage of being a stockholder lies in the fact that they are not obliged to shoulder the
debts and financial obligations incurred by the company, which means creditors cannot compel
stockholders to pay them.
Being a shareholder isn’t all just about receiving profits, as it also includes other responsibilities. Let’s
look at some of these responsibilities.
● Brainstorming and deciding the powers they will bestow upon the company’s directors,
including appointing and removing them from office

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● Deciding on how much the directors receive for their salary. The practice is very tricky because
stockholders must make sure that the amount they will give will compensate for the expenses
and cost of living in the city where the director lives, without compromising the company’s
coffers.
● Making decisions on instances the directors have no power over, including making changes to
the company’s constitution
● Checking and making approvals of the financial statements of the company (Shareholder 2023)
4.1.2 Duties of Directors

Definition: Directors are corporate officers charged with running the business and choosing how it is
run daily for the benefit of shareholders. They can be held accountable for their acts because they are
legally responsible for the company's operations as directors. Directors of corporations are typically
registered with the corporate office after being nominated to the board of directors through a formal
process. A shareholder and a director can both be the same individual. On the other hand, stockholders
are not always directors and vice versa.
The main duties of a director as taken from the statutory statement of director’s duties:
- Act within their powers: A director must act within his powers under the company’s constitution
and only exercise his powers for the purpose for which they were conferred (CA 2006, s171).
- Promote the success of the company: A director must ‘act in a way he considers, in good faith,
would be most likely to promote the success of the company for the benefit of its members as
a whole’ (CA 2006, s172). This duty applies to all directors’ actions, not just those exercised at
board meetings. When making decisions, directors must ensure they have regard for the likely
consequences of the decision over the long term, which means they must take into account
the:
o Interests of employees
o Impact on the community and environment
o Need to foster business relationships with suppliers, customers, and others
o Need to act fairly between members
o A need to maintain a reputation for high standards of business and conduct
- Exercise independent judgment: A director must exercise independent judgment (CA 2006,
s173). This duty largely codifies the requirement in common law for directors to exercise their

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powers independently, without subordinating their powers to the will of others and without
fettering their discretion.
- Exercise reasonable care, skill, and diligence: A director must exercise such reasonable skill,
care, and diligence as would be exercised by a reasonably diligent person with:
o The general knowledge, skill, and experience that could reasonably be expected from a
person carrying out the director’s functions; and
o The director’s actual general knowledge, skill, and experience (CA 2006, s174).
- Avoid conflicts of interest: A director has a statutory duty to avoid any situations in which he
has or could have, a direct or indirect interest that conflicts, or could conflict, with the interests
of the company (CA 2006, s175). This applies in particular to the exploitation of property,
information, or opportunity regardless of whether the company could take advantage of it. It
applies to a conflict of duty, as well as a conflict of interest, and includes the interests of
‘connected persons.
- Not accepting benefits from third parties: A director has a statutory duty not to accept a benefit
from a third party which is given because of the position held by the director or because of
anything the director has done in his capacity as a director (CA 2006, s176). In brief, acceptance
of benefits is not subject to any ‘minimizes’ limit and is only permitted where the matter is
approved by the company’s members or it can reasonably be regarded that it will not give rise
to a conflict of interest with the company.
- Declare interests in transactions or arrangements: A director of a company has a statutory duty
to disclose any direct or indirect interest he has in a proposed transaction or arrangement with
the company (CA 2006, s177). Furthermore, the director has a duty under CA 2006, s182 to
declare any interest held, direct or indirect, in an existing transaction or arrangement. (The
Chartered Governance Institute UK & Ireland,2022)
4.1.3 Roles, duties, and qualification of Secretary

Definition: Secretaries and administrators help keep an organization running smoothly, taking on
administrative and organizational tasks that keep the organization running. A secretary is an employee
of a business who can keep records of meetings of directors and shareholders as well as ownership and
transfer of shares and helps to monitor the company's legitimate interests and is responsible for official
company documents. Secretaries are responsible for the effective management of their company. They

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focus on complying with statutory and regulatory requirements and ensuring that the company
implements the board's decisions.
Roles: The size and nature of the organization had a big impact on the secretary's job in the
corporation. Small businesses might only need a secretary to perform administrative tasks, but in larger
organizations, the secretary will likely be in charge of more duties, particularly those related to legal
compliance. In actuality, not all businesses require a secretary, and a private corporation is not required
to have a secretary for a company (Netlawman, 2020). The corporate secretary also functions as an
official of the corporation. Their major responsibility is to make sure that the firm performs its
obligations under the Companies Act. The company secretary is in charge of making sure that board
procedures are followed and regularly evaluated, according to the Cadbury Report. The chairman and
the board will also consult the company secretary for guidance on how to carry out these duties as well
as their obligations under the laws and regulations to which they are subject. The company secretary's
advice and services should be available to all directors, and they should be aware that the chairman
has a right to significant support from the company secretary to ensure the board's smooth operation
(Cadbury, 1992). As a result of the increased attention paid to corporate governance in recent years,
the role of the company secretary has gained importance. In many ways, the secretary is now seen as
the company's guardian in terms of adhering to the law and best practices (Institute of Directors, 2017)
Duties: Secretaries must be able to multitask and stay organized under pressure. They also need to be
friendly and have excellent communication and interpersonal skills. Secretaries have particular tasks
depending on the industry they work in, but most will have some or all of the following responsibilities:
- Greet visitors and undertake general receptionist duties when required
- Answer phones and respond to emails
- Book meeting rooms, arrange conference calls, take messages and minutes during meetings
- Prepare and distribute correspondence, memos, and forms
- Develop and maintain a filing system
- Manage database entry and client files
- Order and maintain office supplies
- Make travel arrangements
- Manage current agenda and arrange new meetings and appointments
- Assist with bookkeeping, presentations, reports, emails, and letters
- File and update contact information of clients, employees, suppliers, and partners
- Document expenses and financial information

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- Implement and develop office procedures

- Maintain confidential information, file and store them accordingly
- Organise and distribute messages to the appropriate team members
Qualification: Each organization may have its qualifications and standards when hiring for a secretarial
position. However, when employing a secretary, firms frequently focus on the following criteria:
Excellent organizational skills
Experience with customer-facing roles
Patience a ‘can-do’ attitude, and time-management skills
Most secretarial job positions do not have specific formal qualifications as a requirement for
employment – apart from a high school diploma in the US – but a set of demonstrable behavioral traits.
Some of these are:
- Excellent attention to detail
- Administrative skills and experience
- Exceptional written and verbal communication skills
- The ability to multitask
- Be flexible and open to change
- The ability to organize and prioritize
- The ability to work alone and in a team environment in a professional manner
- To be able to use a computer and main office programs competently
However, some industries have specific requirements for secretarial applicants. Specialist secretarial
work in human resources, education, health, legal, or medical require further qualifications. Very often,
knowledge of industry-related software is also needed. (Joss Search, 2023)
4.1.4 Functions and powers of Auditors

Definition: An auditor is a person authorized to review and verify the accuracy of financial records and
ensure that companies comply with tax laws. They protect businesses from fraud, point out
discrepancies in accounting methods and, on occasion, work on a consultancy basis, helping
organizations to spot ways to boost operational efficiency. Auditors work in various capacities within
different industries.
Auditor responsibilities include examining and confirming the accuracy of financial documents and
ensuring that businesses are adhering to tax regulations. Its primary goal is to protect businesses from
fraud, which they do in part by spotting inconsistencies in accounting procedures (Cleartax, 2021). To

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carry out his duties as an auditor, every company auditor must always have access to the books of
accounts and company vouchers, whether they are kept at the registered office of the company or
elsewhere (Section 143 of the Company Act 2013 (Vic). He may also request information and
justification from the corporate officers.
According to the Companies Act of 2013, an auditor has four primary responsibilities. Auditors must
first create a report. The auditor shall report to the members of the company on the accounts examined
and on each financial statement required by or under this Act, taking into account the provisions of
this Act, the accounting and auditing standards, and matters required for inclusion in the audit report
as set forth below. Act in the general meeting of the company, or any rules made thereunder, shall
give, to the best of its knowledge and information, a genuine and fair view of the state of operations
of the enterprise as of the end of the year, of its profit or loss and cash flow, and all other matters as
may be prescribed. According to Section 143 of the Corporation Act 2013 (Vic), these accounts and
financial statements must include. Second, when required, auditors must provide an unfavorable view.
Since it provides the auditor's perspective on the financial statements, the auditor's report is quite
trustworthy. The auditor has the power to provide a negative opinion in situations where they believe
the declarations do not present a true and fair picture of the financial status of the company. Also, they
will issue a disclaimer if they find themselves unhappy and unable to provide a proper opinion on the
claims. An opinion disclaimer only states that the lack of information makes it impossible to determine
the company's financial situation. The report should, however, also explain why such a negative opinion
is held (Cleartax, 2021).
The third need is that auditors support a branch audit. Since the auditors are branch auditors rather
than company auditors, they assist in financing the completion of the branch audit. Using the branch
Accounts it has examined, it will generate a report, which it will then send to the company's auditor.
The main audit report for the corporation will then contain the report, according to the auditor.
Additionally, if he so chooses, he can provide the auditor with excerpts from his working documents to
aid with the audit. (2021 Cleartax)
Finally, auditors are required to follow the auditing standards. The National Financial Reporting
Authority works with the Central Government to publish the Auditing Standards. These standards help
the auditor carry out his auditing duties efficiently and accurately. The auditor must adhere to the
standards when performing his duties because doing so increases his effectiveness. (2021 Cleartax)

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4.2 How business organizations are funded

4.2.1 Bonds
Definition: A bond is a type of fixed-income security that simulates a loan from an investor to a
borrower (usually a business or government). A bond can be compared to an agreement outlining the
terms of the loan and the associated payments between the lender and borrower. Companies,
municipalities, states, and sovereign governments utilize bonds to finance operations and initiatives.
Bondholders are the issuer's debtors or creditors.
Advantages of investing in bonds:

Simple to sell and purchase: Bonds are simple to purchase, but investors must be aware of the terms,
circumstances, return policy, and profitability of the bond. Bonds can be bought directly by investors
through a broker, indirectly through a bond mutual fund, or directly from the Treasury Department's
official website for US Treasury bonds.
A wise financial decision: Because the issuer promises to restore the bond's face value, bonds are
viewed as less risky investments. Bonds offer a significant return on investment and give investors the
chance to make a respectable living. Bonds may present enticing potential capital rewards.
Compared to other investments, a safe investment
Bonds, especially short- or medium-term bonds, have lower volatility than equities (stocks), making
them generally seen as a safer investment than stocks. Retirement investors should make this
investment since bonds turn into a source of income for them without them having to work because
bonds provide interest on their living expenses and protect their savings.
Bonds are preferable to banks: Few investments (savings accounts and other programmatic
investments) are superior to bonds than banks. Bond interest rates are higher than the interest rates
offered by the bank on deposits (savings). TDS is not applied to investments in corporate bond funds,
however, banks apply a 10% TDS to fixed deposits.
A reliable source of fixed income: Bond interest payments are higher than normal dividend payments
because a company or individual may easily sell many bonds without the price changing, which is much
more difficult with stocks. Bonds are therefore more liquid for a company or individual than stocks.
Bonds are advantageous because they offer a fixed income payout twice a year and a fixed amount at
maturity, as opposed to low daily volatility. According to RBI criteria, government bonds are a good

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source of fixed income. Interest on government bonds is paid out every six months, giving investors a
fantastic opportunity to invest their unused funds and receive a monthly income.
Stability: Compared to other investment options, bonds are long-term investment products with
guaranteed yields that are tradable and low risk. Even while dividend income from stocks has typically
outpaced bond gains, bonds are inelastic to cyclical market volatility.
Diversification of holdings: When an investor diversifies their investments, they make numerous
different types of bets. Distributing funds throughout many platforms or asset classes like stocks,
bonds, and cash, lowers the chance of losing money. By doing this, volatility and overall portfolio risk
may be decreased. Bonds are less erratic than other assets, therefore many investors use them as a
form of diversification in their portfolios.
Disadvantages of investing in bonds:

Market turbulence: The market determines how much a bond is worth, and its value is influenced by
two variables: market volatility and macroeconomics. The rating given by credit agencies, which can
either upgrade or downgrade a bond issuer based on its financial health, also has an impact on bond
prices. However, these outside variables only affect the market price of bonds; they do not affect the
bond's interest rate or coupon interest payment.
Changing interest rates: Since the bond price and interest rate are inversely related, changes in the
interest rate of the bond rely on its price. When the price of bonds rises, interest rates fall, and vice
versa. Because of this, increasing interest rates may reduce a bond's total value. The institutional and
mutual fund investors having exposure to bonds are impacted by this variation or change in bond price.
Professional investors like banks, insurance firms, and pension funds are impacted by this.
Not the greatest for quick investments: Bonds are not intended for one-year investments since the
investor must pay a penalty (equivalent to three months of interest) if the bond is not redeemed within
the year. When the issuer withdraws money at any point after purchasing the bond for five years, this
situation occurs.
Narrow liquidity: In terms of liquidity, bonds can be traded like shares. Bonds are often long-term
investments with limits on how much can be withdrawn. Bonds issued by creditors are subject to
several fees and penalties if they choose to redeem their obligation before it matures.
lower profits: In the bond market, there are primarily two sorts of returns possible on two different
types of bonds: fixed-rate bonds and floating-rate bonds. Bonds with fixed rates pay a set interest rate
at regular intervals; those with floating rates experience variable yields dependent on a benchmark

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rate. Benchmark rates include the customer pricing index and the London interbank offer rate. In India,
a bond's long-term investment return may be lower than that of equity. For instance, a bond typically
yields 7% annually. The overall return from a bond is still much lower than equity because equities
investments yield around 12%, while the bond tax is higher than equity.
4.2.2. Stock
Definition: A stock, usually referred to as equity, is a type of investment that denotes ownership in a
portion of the issuing company. The "shares" that make up a unit of stock entitle the owner to a piece
of the corporation's assets and income proportional to the number of shares they possess. Most
individual investors' portfolios are built on stocks, which are mostly bought and sold on stock
exchanges. Government standards designed to shield investors from dishonest tactics must be
followed during stock trades.
Advantages of investing in stocks:

Return on Investment: Historically, the stock market has outperformed the majority of other
investment options. The stock market gives the chance to grow money over time for investors.
Additionally, many reputable businesses provide dividends to shareholders, raising the overall return
on investment.
Ownership in a Company: Purchasing stock in a company is one of the simplest ways to acquire a
minority stake in it. An investor effectively owns a piece of the company's shares when they purchase
shares of a company. Even though their ownership stake might not be large, the investor will be
allowed to cast a vote on a variety of managerial and business choices.
Liquidity: The most liquid investment strategy available to investors is stock investing. Share
transactions can be completed quickly. The investor will have the opportunity to vote on various
business and leadership choices, and he or she may always readily sell their shares if they are needed
for instant liquidity.
Disadvantages of investing in stocks:

Significant Risk: Investments in the stock market carry a high level of risk. An investor could lose all of
their money in unfavorable market conditions. Stocks are extremely risky investments. As a result, it
is advised to invest cautiously.

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Timing: It is virtually impossible to correctly time the market. It is challenging to meet the target
because of how volatile the equities are. A wise trading method is to buy low and sell high. However,
it is difficult to purchase them at the lowest price and sell them at the highest.
Knowledge: Thorough research on the company and the market is necessary before investing in stocks.
It takes a lot of time to examine financial accounts, and yearly reports, compare previous performance,
do industry analyses, etc. Stock investing is therefore a gamble unless one can perform all the
homework before investing.
Emotions: Investors frequently buy at high prices in anticipation of price increases when they observe
stock movements (out of greed). Additionally, they sell their assets at a loss in the hope that the price
will drop even lower (because of fear). Price swings happen frequently. It's important to remember not
to let them deceive you, though.
In a case when the company goes out of business, the preference shareholder and bondholders or
creditors are paid first. Stockholders are paid last. Finally, ordinary investors are compensated to
prevent them from becoming overawed.
V. Compare and contrast different sources of legal advice and dispute resolution assistance to make
appropriate recommendations on legal solutions: (P6)
5.1 Alternative Dispute Resolution (ADR)
Alternative dispute resolution (ADR) refers to the different ways people can resolve disputes without
a trial. Common ADR processes include mediation, arbitration, and neutral evaluation. These processes
are generally confidential, less formal, and less stressful than traditional court proceedings. ADR often
saves money and speeds up settlement. In mediation, parties play an important role in resolving their
disputes. This often results in creative solutions, longer-lasting outcomes, greater satisfaction, and
improved relationships. All ADR methods have common characteristics – i.e., enabling the parties to
find admissible solutions to their conflicts outside of traditional legal / court proceedings, but are
governed by different rules. The most famous ADR methods are the following: Arbitration, Mediation,
Conciliation, Negotiation, Tribunals, and Ombudsman.
5.1.1 Tribunals
A tribunal is a quasi-judicial institution that is set up to deal with problems such as resolving
administrative or tax-related disputes. It performs several functions like adjudicating disputes,

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determining rights between contesting parties, making an administrative decision, reviewing an

existing administrative decision, and so forth.
5.1.2 Arbitration
What Is Arbitration? Arbitration involves settling a legal dispute without going to trial. Going to trial
can be expensive and time-consuming, meaning arbitration can be advantageous to many people.
During the arbitration, a third party listens to both sides of a legal disagreement. With the documents
provided and the oral statements of each person involved, the arbitrator will issue a resolution.
Witnesses will sometimes be called in to provide an oral statement. Arbitration can be a great way to
avoid legal costs, but careful consideration is required to determine whether arbitration is useful for a
specific legal case.
Types of Arbitration
Arbitration is most used in the following scenarios:
• Labour disputes
• Business/consumer disputes
• Family law matters Once an arbitrator has made their decision, the legal outcome is final and cannot
be appealed. Many contracts have a specific arbitration clause, meaning that arbitration is a
requirement.
Advantages of Arbitration
• Fairness: Both parties agree to the arbitrator, resulting in a fair outcome, especially when compared
to a traditional legal trial in which neither party has control over the jury or judge selection. Parties can
also agree to choose an arbitrator that has experience in their specific area of legal dispute.
• Timeliness: A legal resolution through arbitration is much quicker than waiting for a trial date.
Arbitration is less formal and more flexible in terms of scheduling. The discovery process is a simple
phone call, cutting down on much of the traditional trial process.
• Cost: Arbitration does not include expert witnesses or require as much legal preparation. Both parties
often split the cost of the arbitrator, meaning the process is much cheaper.
• Confidentiality: The arbitration legal process is more private than a trial.
• Finality: There is a level of finality to the arbitration process. Because it cannot be appealed, both
parties can move on following the outcome.

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• Agreeableness: Arbitration often results in an agreeable outcome, as parties are encouraged to come
up with a solution together.
• Simplified Procedures: Legal outcomes are more adaptable to the two parties present in the dispute.
Each party does not have to hire an attorney for representation.
Disadvantages of Arbitration
There are also some disadvantages of arbitration to consider:
• No Appeals: The arbitration decision is final. There is no formal appeals process available. Even if one
party feels that the outcome was unfair, unjust, or biased, they cannot appeal it.
• Cost: While arbitration is generally a more cost-efficient legal settlement option, it might not make
sense in cases when minimal money is involved.
• Rules of Evidence: A judge in a traditional court setting has specific regulations to follow when it
comes to accepting evidence. Arbitrators, however, can utilize any information that is brought to them.
• Lack of Cross-Examination: The arbitration process generally includes documents and not witnesses,
voiding the ability to cross-examine.
• Limited Discovery: If arbitration is not filed until litigation has already begun, both parties lose the
cost-saving advantage of limited discovery.
• Lack of Consistency: There are no set standards for arbitration, making it difficult to find consistency.
It is possible that an arbitrator can be biased, which is sometimes the case in mandatory arbitration
contracts.
• Lack of Evidence: Because arbitration is not evidence-based, you entrust the experience of the
arbitrator to make the right legal decision.
• Not Public: The level of confidentiality involved in arbitration cases could potentially be
disadvantageous to one party. There is also a lack of transparency, which is not the case in public
courtrooms.
5.1.3 Mediation
What Is Mediation? Mediation is familiar to most people as a means of resolving labor management
and international disputes, but it also has been used to settle the contract, interpersonal, human
resource, and EEO conflicts. Mediation involves the intervention of a third person, or mediator, into a
dispute to assist the parties in negotiating jointly acceptable resolution of issues in conflict. The

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mediator meets with the parties at a neutral location where the parties can discuss the dispute and
explore a variety of solutions. Each party is encouraged to be open and candid about his/her point of
view. The mediator, as a neutral third party, can view the dispute objectively and assist the parties in
considering alternatives and options that they might not have considered. The mediator is neutral in
that he or she does not stand to personally benefit from the terms of the settlement and is impartial
in that he or she does not have a preconceived bias about how the conflict should be resolved.
Advantages of Mediation
• Mediation can be carried out relatively quickly compared to litigation, taking on average between 1
to 2 days;
• If both parties agree to mediation this demonstrates a willingness to achieve a negotiated solution;
• The appointed mediator will be independent, they will not advise or provide judgment;
• The mediator is there to facilitate and guide the discussions between the parties, with the primary
objective of resolving the dispute;
• It is the parties involved in the mediation process that arrive at a final solution and not the mediator;
• It is a flexible process that provides parties access to a wide range of outcomes that are not available
in litigation.
• If a solution cannot be achieved then other options are still available;
• The process will attempt to preserve the relationship between the parties;
• Mediation can allow each party to hear the opposing view in a non-confrontational environment;
• Both parties must sign an agreement of the final recommendation for it to be binding;
• The parties via the mediator can bring other matters outside of the contract itself into the mediation
to assist a commercial settlement;
Disadvantages of Mediation
• Not compulsory;
• Concerns exist around the enforceability of a mediation agreement;
• All parties must agree to a resolution as the result is not guaranteed;
• Can be difficult if either party is withholding information;
• Mediation may not be appropriate if one of the parties required public disclosure;
• Utilising the services of an unskilled mediator can contribute to an unproductive resolution;

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• An unwillingness of one or both of the parties to cooperate can make the whole process a waste of
time, effort, and money;
• If the dispute cannot be resolved in mediation the cost of mediation will have been wasted;
• During the mediation process either party can withdraw from proceeding at any time;
• There is the possibility that information may be given away to the other party during the mediation
process that could benefit the other party.
5.1.4 Ombudsman
What Is Ombudsman? An ombudsman is a legal delegate, designated by a government authority or an
organization to investigate several complaints created by individuals for the subject of citizens of a
country or executives of an organization (Tyagi) Put simply, an ombudsman is an official representative,
elected by the government or an association, who interrogates accusations made by other citizens
against businesses, financial institutions, government departments, or other public articles, etc while
attempting to answer the conflicts or perturb arising either through conciliation or by accounting
proper judgments. The Ombudsman is independent, and unbiased and gives cost-free services. He/she
investigates complaints when problems have been commanded inappropriately or unfairly, or making
citizens undergo unfair consequences, some situations similar to maladministration, included examples
are inconsistent delay, disrespect, negligence to follow tidy procedures, bias, presenting inadequate
suggestions willingly, etc.
Advantages of Ombudsman
• No expenses/payments.
• An autonomous system, i.e., independent from government.
• Reports get proclaimed while addressing methodical issues emerging under an agency or while
deploying a government program.
• Improper practices could be corrected.
• An ombudsman of the state may provide reconciliation along with an impartial investigation.
Disadvantages of Ombudsman
• An ombudsman unable to render instantaneous solutions for very complicated problems.

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• The accuser has no command of the investigation, which means an ombudsman doesn’t only for the
accuser, and declines deals over some specific matters.
• Specific decisions, made by an ombudsman, are not obligatory.
• The Federation ombudsman can provide only investigation, not reconciliation.
5.1.5 Conciliation
What Is Conciliation? Like mediation, conciliation is a voluntary, flexible, confidential, and interest-
based process. The parties seek to reach an amicable dispute settlement with the assistance of the
conciliator, who acts as a neutral third party. (Stevenson, 2021) The main difference between
conciliation and mediation proceedings is that, at some point during the conciliation, the conciliator
will be asked by the parties to provide them with a non-binding settlement proposal. A mediator, by
contrast, will in most cases and as a matter of principle, refrain from making such a proposal.
Conciliation is a voluntary proceeding, where the parties involved are free to agree and attempt to
resolve their dispute by conciliation. The process is flexible, allowing parties to define the time,
structure, and content of the conciliation proceedings. These proceedings are rarely public. They are
interest-based, as the conciliator will when proposing a settlement, not only take into account the
parties' legal positions, but also their; commercial, financial, and/or personal interests. Like in
mediation proceedings, the ultimate decision to agree on the settlement remains with the parties.
Advantages of Conciliation
• An early opportunity to resolve claims and achieve certainty without an ongoing investment of time,
money, and emotion.
• An opportunity to express feelings and seek remedies outside the strict confines of the legal grounds
of the claim.
• The conciliator is an independent expert who can reality test the claim/defense and expectations and
raise alternative solutions.
• The process is private and settlement agreements are generally confidential – this may also be a con
sometimes.
• The parties reserve the right to go to court if they are not happy with the outcome The process is
relatively informal so parties should not feel too far out of their comfort zone.

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Disadvantages of Conciliation
• Conciliation is about getting an outcome rather than “justice” which means compromise by both sides
is necessary for settlement.
• Conciliators don’t carry the same authority as judges/commissioners.
• There is no independent determination of a claim in a conciliation/mediation.
• Many conciliations are conducted by phone. It is often easier to say “no” when you are not looking
the other side in the face.
• Both sides often have strong feelings and are not prepared to concede their positions at an early
stage – sometimes the pain and expense of litigation need to be felt before the realities of litigation
set in.
• Time is relatively short, generally an hour or 2 (or 3 at most) and there is no time for detailed
statements of facts or lengthy consideration of issues.
• There is often pressure to make, accept or reject offers during the conciliation. “Settlers remorse” is
not uncommon.
• Some conciliators are more interventionist or more willing to express a view and get involved in the
process than others If either side breaches a settlement agreement, separate legal enforcement action
is usually necessary.
5.1.6 Negotiation
What Is Negotiation? Negotiation is a method of dispute resolution whereby a dispute between two
individuals or groups is settled amicably by an impartial third person called as a negotiator, using
different techniques. The negotiator, in this form of resolution, uses various communication methods
to bring the parties of the dispute to a settlement. The primary aim of this type of dispute resolution is
to reach an agreement that is fair and acceptable to the parties. The parties engage in a dispute with
each other until they reach a desirable outcome for all involved.
Advantages of Conciliation
• Flexibility: since negotiation is an informal process, it is relatively flexible.
• Quick resolutions as compared to litigation.
• It facilitates maintaining a healthy relationship between the disputing parties.
• Takes place in a private environment.
Disadvantages of Conciliation

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• The parties to the dispute may not come to a settlement.

• Lack of legal protection of the parties to the conflict.
• Imbalance of power between the parties is possible in negotiation.
5.2. Civil litigation procedures (court)

5.2.1. Definition
Civil litigation is a term that applies to any legal dispute where two or more parties are seeking
monetary damages or specific performance and does not include criminal accusations. Some cases go
to trial in which a judge will determine the outcome, but not all will. There are many different types of
civil litigation. This type of dispute may arise over Product liability, Construction liability, Medical
malpractice, Personal injury, Real estate disputes, Workers' compensation claims, Divorce, Intellectual
property disputes, Antitrust litigation, and Landlord/Tenant disputes. In the broadest sense, civil
litigation is any legal proceeding that does not involve criminal charges or penalties. Generally, steps
in the civil litigation process start with filing a lawsuit, then the petition is accepted, next a decision to
bring the case to trial is made, and finally, the lawsuit will be judged by the Court. (Huu, 2022) According
to the Code of Civil Procedure 2015, at the first instance level, the lawsuit will be resolved through the
following procedures: Acceptance of the Court The petitioner can directly submit a petition to the
Court, send it by post, or submit it online at the Court’s Website Portal (if any). In case of directly filing
a lawsuit, the petitioner will be issued with a certificate of receipt of the petition. In case of filing by
post, the Court shall send a notice of receipt to the petitioner at the address where the petition was
sent. In case the petition is submitted online, the petitioner will be issued a notice of receipt of the
petition by the Court via the Court’s web portal (if any). According to the steps in the civil litigation
process prescribed in the Code of Civil Procedure 2015, within 03 days of the date of receipt of the
petition, the Chief Justice of the Court shall assign a Judge to consider the petition.
Within five working days from the date of assignation, the Judge who is assigned to consider the
petition should do the following tasks:
• Requesting an amendment or a supplement to the petition;
• Carrying out an acceptance procedure of the lawsuit;
• Transferring the petition to the competent Court and notifying the petitioner if the case falls under
the jurisdiction of another Court;

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• Returning the petition to the petitioner if the case does not fall to the jurisdiction of the Court.
Mediation and preparation for a trial In the steps in the civil litigation process the term of a trial
preparation can last from 2 to 4 months and can be extended from 1 to 2 months depending on the
type of lawsuit as well as the nature, complexity of the lawsuit that such a term. During the term of
preparation for a first-instance hearing, the Court should conduct conciliation to enable the litigants to
reach an agreement on the resolution of the case (except in cases where conciliation is neither allowed
nor conducted as prescribed in the Code of Civil Procedure).
During the preparation for the hearing, as the case may be, the Judge should issue one of the following
decisions:
• a recognition of the agreement reached by the litigants if they have reached an agreement on the
resolution of the case;
• temporary suspension of the resolution of the case;
• suspension of the resolution of the case;
• bringing the lawsuit to trial. Within one month from the date of issuance of the decision, the Court
must open the trial; for a proper reason, the Court may open the trial within two months. Opening the
trial In the steps in the civil litigation process, at the first-instance trial the Trial Panel administers the
trial according to the following process:
• Preparing for the opening of the trial.
• Starting the trial.
• Making an oral argument at the trial.
• Conducting deliberation of a judgment and pronouncement of the judgment.
5.2.2. Advantages
Firm Resolutions: Many disputes cannot be resolved through alternative dispute resolutions (ADR).
Litigation provides a clear outcome in a public forum, so even though each party may feel they are in
the right, a judge will use facts and evidence to determine a clear resolution.
Sets Precedent: If you believe a lawsuit may repeat itself over time, having a defined resolution will
help to fight similar claims in the future. It can also help effect change by setting precedent for others
who may find themselves in the same situation.
Stricter Evidence Guidelines: During ADR, evidentiary power is usually in the hands of the arbiter, so
biases can become an issue. Courts, on the other hand, have much stricter rules when it comes to how

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evidence is collected and presented. Litigation also helps force the hand of those unwilling to provide
requested evidence with court-mandated guidelines and penalties for non-compliance.
Appeals: Should you feel a mistake was made or the court was in some way biased against you during
your case, you have the right to appeal the case to be heard in a higher court. In ADR, results are
generally final, no matter what happens.
5.2.3. Disadvantages
Time Consumption: As previously mentioned, court hearings take time. With the myriad of lawsuits
being filed every day, there isn’t enough time to hear them all promptly. It could take months to simply
get your case in front of a judge.
Stressful: As you wait to get this dreadful monkey off your back, the stress of the situation can weigh
heavily on your mind, causing you to lose a step in business and life, which could lead to additional
problems.
Damaging Relationships: Litigation can be emotionally draining and affect your relationships
negatively. Distraction can lead to ignoring immediate family members or picking fights with close
friends and relatives.
5.3. The role of unions

5.3.1. Definition
A trade union is a group formed by employees of the same trade, firm, company, or industry to
safeguard their rights, salaries, and working conditions from the exploitation of their employer. Nearly
every profession, industry, and organization have its unions. Examples include nurses’ unions, teachers’
unions, drivers’, labor unions, and lawyers’ unions. They don’t work under management, but unions
have the power to accept or reject any terms and conditions on behalf of workers. Labor unions have
been accorded legal status in many countries like the United States and the United Kingdom. It means
employers must make a legally binding union agreement, namely collective bargaining agreement
(CBA), for a fixed duration. These agreements are related to welfare measures, perks, and the working
conditions of the employees. Functions of Trade Union The trade union roles are related main types
related to their members, organization of the union, union activities, and contribution to society.
Members
• Safeguard the workers’ rights and privileges from management encroachment.

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• Ensure a healthy and sound working environment.

• Fight for the performance-linked bonus for workers.
• Negotiate for insurance, housing, healthcare, education, and cooperative societies for the workers
from the management.
• To help workers financially in times of emergency through union funds and management corpus.
Organization
• To improve production and worker efficiency as per the requirement of the firm through discussions
with the management.
• act as a bridge between the worker and the management for all types of communication.
• To convince management to act as a motivator and not as punitive toward workers.
• To guide management in formulating and implementing employees’ welfare schemes and activities.
• Impress the management with pressure tactics to avoid illegal termination and punishment, and treat
every worker justly.
• conduct elections for various posts of the union. Union Activities
• To maintain records of all the worker members of the union
• To organize various events to promote unity among members
• Act as a mediator between the aggrieved worker and the member superior.
• To collect funds for strengthening the union.
• To bring a culture of leadership amongst the members
• To help new members of the organization and the union to settle down easily.
Society
• To undertake social upliftment works for the poor like free books, rations, and scholarships to needy
students.
• To raise voices against anti-social policies of the government and management of the related sector
by trade unionists.
• To be a role model for society in terms of social work.

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5.3.2 Advantages
Counter-balance monopsony: Unions can bargain for higher wages - overcoming unfair wages in a
monopsony.
Represent workers: Unions can represent workers at employment tribunals.
Productivity deals: A trade union can help a firm to bring in new working practices which increase labor
productivity.
Co-operation: Unions, in theory, can help bring workers closer to management and represent interests.
Efficiency wage theory: This states higher wages increase the motivation and productivity of workers.
5.3.3 Disadvantages
Unemployment: In a competitive labor market, unions pushing wages above equilibrium cause
unemployment.
Cost-push inflation: Powerful unions can push up wages causing inflation.
Time lost to strike: Unions can lead to lost productivity by the strike.
Confrontation: Unions can also create a confrontational attitude - leading to disputes and poor morale
Less relevant: In the gig economy, it is harder for unions to organize and have an impact.
VI. Conclusion
In a nutshell, in this report, we've used concrete examples that show how corporate, employment, and
contract law can have a potential impact on businesses. An explanation of how business organizations
are legally formed. Also explains how business organizations are managed and funded. It also compares
and contrasts different sources of legal advice and dispute resolution assistance to make appropriate
recommendations for legal solutions.
VII. References
1. Twin, A. (2023) Sole proprietorship: What it is, Pros & Cons, examples, differences from an
LLC, Investopedia. Investopedia. Available at:
https://www.investopedia.com/terms/s/soleproprietorship.asp (Accessed: April 13,
2023).

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2. Nolo (2020) Advantages and disadvantages of LLCs, www.alllaw.com. Nolo. Available at:
https://www.alllaw.com/articles/business_and_corporate/articlelz10.asp (Accessed:
April 13, 2023).
3. Joint Stock Company: Features, advantages, disadvantages & examples - TOPPR (no date).
Available at: https://www.toppr.com/guides/business-studies/forms-of-business-
organisations/joint-stock-company/ (Accessed: April 13, 2023).
4. Kopp, C.M. (2023) Partnership: Definition, how it works, taxation, and types, Investopedia.
Investopedia. Available at: https://www.investopedia.com/terms/p/partnership.asp
(Accessed: April 13, 2023).
5. Fernando, J. (2023) What is an LLC? limited liability company structure and benefits defined,
Investopedia. Investopedia. Available at: https://www.investopedia.com/terms/l/llc.asp
6. Information, guidance, and advice advantages and disadvantages - quizlet (no date).
Available at: https://quizlet.com/gb/410204335/b4-information-guidance-and-advice-
advantages-and-disadvantages-flash-cards/ (Accessed: April 14, 2023).
7. Gaille, L. (2017) 14 labor unions pros and cons, Vittana.org. Available at:
https://vittana.org/14-labor-unions-pros-and-cons (Accessed: April 14, 2023).
8. ACMC, E.S.C., and Edeh Samuel Chukwuemeka ACMCEdeh Samuel Chukwuemeka ACMC
(2021) Advantages and disadvantages of alternative dispute resolution (ADR), Scholarly.
Available at: https://bscholarly.com/advantages-and-disadvantages-of-alternative-
dispute-resolution-adr/ (Accessed: April 14, 2023).
9. Joss Search (2023) Secretary job description: Duties, salary, required skills, Joss Search.
Available at: https://josssearch.com/secretary-job-descriptio (Accessed: April 15, 2023).
10. The Chartered Governance Institute UK & Ireland (no date) Directors' duties, The Chartered
Governance Institute. Available at: https://www.cgi.org.uk/professional-
development/careers/directors-duties (Accessed: April 15, 2023).
11. Shareholder (2023) Corporate Finance Institute. Available at:
https://corporatefinanceinstitute.com/resources/equities/shareholder/ (Accessed: April
15, 2023).
12. Kopp, C.M. (2023) Partnership: Definition, how it works, taxation, and types, Investopedia.
Investopedia. Available at: https://www.investopedia.com/terms/p/partnership.asp

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Law for Business (Trường Đại học FPT)

Studocu is not sponsored or endorsed by any college or university

ASSIGNMENT 2 FRONT SHEET

Qualification BTEC Level 4 HND Diploma in Business

Unit number and title Unit 7 Business Law

Submission date 15/4/2023 Date received (1st submission) 15/4/2023

Re-submission date Date received (2nd submission)

Student names & codes Final scores Signatures

1. Phùng Hồng Anh bh00118 Hồng Anh

2. Lý Thị Nguyệt Nguyệt

4. Phùng Hồng Ánh bh00119 Ánh

Class BA0502 Assessor name Nguyen Thu Hien

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5.2.1. Definition ........................................................................................................................................... 36

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Rulings made by the court

2.2. Employment law

Decisions of the court

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Effects of legal issues

2.3. Company law

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3.1. Sole Proprietorship

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3.3. Limited Liability Company (LLC)

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3.4. Joint Stock Company

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4.1.1 Roles of a Shareholder