Business & Corporate Law

Prepared by:
Dr Mildred C. Muhyila
(BALIS, LLB, LLM, DBA)

2024
 Course Objective

• To enable students appreciate the main sources of the Zambian law

• To enable students to appreciate the other essential elements of the
Zambian legal systems and to appreciate how these elements affect or
influence the business environment such as laws relating to and
affecting:-
– Contracts,
– Employment,
– Agency,
– Tort,
– Business associations
 Learning Outcomes
At the end of the study, students should be able to:-
• Understand what law is and explain the various sources of law in Zambia,
• explain and apply the legal rules relating to the law of obligations and demonstrate how
the Sale of Goods Act 1893 affects contracts,
• explain and apply the employment law and the law relating to agent-principal relations,
and the law of torts,
• distinguish the different types of companies and explain and apply the law of
partnerships and the concept of separate legal personality of companies,
• explain the rules relating to financing of companies in reference to share and loan
capital and
• explain the rules relating to management, administration and governance of companies
and corporate insolvency
 Notes
Chapter 1
Chapter 1: Definition of law
• Body of rules and principles;
• formally enacted or customary;
• enforced among the members of a given State
• for the guidance of human conduct.
 Classification of law

National law

Public law Private (Civil) law

(Concerns the State) (concerns individuals)

Examples:- Examples:-
Criminal law Contract law
Constitutional law Tort law
Administrative law, etc Family law, etc
 Distinction between Criminal &
Civil liability
Criminal law
A crime is conduct prohibited by law
1. Who brings the action?
Prosecution v Defendant, e.g. The People v Banda
2. Burden of proof? Lies with Prosecution
3. Standard of proof? Prosecution must prove guilt “beyond reasonable doubt”
4. Where is the action heard?
Magistrates Courts but indictable offences are heard in the High Court on
committal
5. Remedy/ sentence
Fines or imprisonment
 Distinction between Criminal &
Civil liability
Civil law
1. Who brings the action?
Claimant (Plaintiff) v Defendant, e.g. James v Banda
2. Burden of proof? Lies with Claimant/ Plaintiff
3. Standard of proof? Claimant must prove liability on a “balance of
probabilities”
4. Where is the action heard?
Local Courts, Magistrates Courts and the High Court
5. Remedy/ sentence
Compensation e.g. damages
 Distinction between Criminal &
Civil liability
 The true distinction does not lie in the nature of the wrongful
act itself but in the legal consequences that follow
 Easily distinguishable by
 Terminology
 Procedure
 Outcome
 Sources of Law in Zambia
According to Article 7 of the Constitution:-
1. The Constitution
2. Legislation
3. Customary law
4. English/ International law and
5. Case law
 The Constitution
Historical development:-
• 1964 – Independence Const.
• 1973 – The One Party Const.
• 1991 – The Multi Party Const.
• 1996 Const.
• 2016 Const.
Types of Constitutions
• Flexible – easy to amend
• Rigid – difficult to amend.
The Zambian Const. is partly flexible and rigid. Other Parts can easily be amended by
Parliament, whereas Part III can only be amended through a referendum.
 The Constitution
• Found in Chapter 1 of the Laws of Zambia
• Its the supreme law of the land [Art 1(1)]
• Any law that is inconsistent shall be declared void
 Banda v The People, [Penal Code; corporal punishment] (1977),
 Thomas Mumba v The People [ Corrupt Practices Act; taking of
oath] (1984) and
 Christine Mulundika & others v The People [Freedoms of assembly
and expression] (1995)
• Creates the three branches of government, i.e. Executive,
Legislature and Judiciary
 Legislation
Comprises of Acts of Parliament and Delegated Legislation
• Acts of Parliament (Statutes) enacted by the legislature [Const. Art 62 (1,2)]
Process of making law in Zambia
• Laws are made by parliament and any proposed law is known as a bill. It must go through five (5)
stages before it becomes an Act of Parliament.
1. First reading: the bill is introduced to Parliament and there is no debate at this stage.
2. Second reading: the bill is debated and if need be, changes are made to it.
3. Committee stage: the bill is taken for scrutiny to either the committee of the whole house or a
specialised committee for perfection. Amendments may be made at this stage.
4. Report stage: the committee reports back to the whole house and more amendments can be made.
5. Third reading: Final stage for the whole house to revisit the bill before it can either be sent for
assent or not.
• Presidential assent: the President signs the bill and it becomes law or an Act of Parliament
immediately or at a later date depending on what the bill itself states.
 Legislation Process
• Delegated legislation enacted by:-
– Ministers – Statutory Instruments (SI’s) or
– Local Govt. – By- laws
• Parliament controls del. Leg through Joint Select Committees
which scrutinise all SI’s
• The Courts also control del leg. through declaring void actions
which are ultra vires or invalid if inconsistent with Part III of the
Constitution
• Other bodies, e.g. Professional bodies pass regulations which are
only applicable on members
 Rules of Interpretation
When courts are interpreting statutes, there is
vagueness (unclear) or ambiguity (many meanings)
The Literal Rule
• Give words their natural, plain, ordinary or dictionary meanings
• May result in of absurdity e.g Fisher v Bell [1961] (sale of flicker
knives), Whiteley v Chappell [1868] (attempt to impersonate a
dead person)
The Golden Rule
• Used to avoid absurdity, inconvenience or inconsistency e.g Re:
Sigsworth [1935]
 Rules of Interpretation Cont.
The Mischief Rule
• Looks to the wrong which the statute was trying to correct
• Based on Heydon’s case were it was stated that judges
should:-
1. What was the law before the Act was passed?
2. What was wrong with that law (the mischief or defect) for
which common law did not provide?
3. What remedy did Parliament resolve to cure that defect?
E.g Smith v Hughes [1960]
 Rules of Interpretation Cont.
The Context Rule
• Act is understood with reference to the words around it
• Words can have many meanings when read alone
• “noscitur a sociis” – ‘a word is known by the company it
keeps’ e.g. Ntombizine Mudenda v AG [1979]
 Rules of Interpretation Cont.
The Fringe Rule
• When a situation was not foreseen by the legislature
• Words may have a potential of uncertainty when applied to
practical issues
• Interpretation in light of policy e.g AG v Steven Luguru
[2001]
 Customary Law
Dual system whereby received law is administered side by
side with customary laws
For a custom to be recognised, it must:-
• Not be unreasonable
• Be certain
• Existed since time immemorial
• Have been exercised continuously
• Be obligatory
• Be consistent with other customs
• Not have been opposed

Be in conformity with written laws and must not be repugnant

to natural justice or morality
 English and Inter. Law
• British statutes and English law are introduced into Zambia through the
British Acts Extension Act Chapter 10 and
• The English Law (Extent of Application) Act Chapter 11 of the
Laws of Zambia
• The common law, the doctrines of equity, the statutes which were in
force in England on 17 August 1911 all applicable in Zambia subject
to the provisions of the Constitution of Zambia. serves as reserve law
(The Ple v Shamwana & Others)
• Inter. Law comes from conventions and treaties but these are not self
executing. They must be domesticated before they can become part
of law in Zambia
 Case Law
• Based on decisions derived from case law
• Draws legal history from Britain
• Development of Common law and Equity
• Equity: led to better procedures, recognition of more rights and
awarding of more remedies(equitable)
• Based on the principle of judicial precedent (consistency) – stare
decisis (to stand by a decision)
• Precedents can be binding or persuasive
 Case Law Cont.
A Judicial Precedent:-
• Must be a proposition of law
• Must form part of the ratio decidendi (rationale for the
decision) and not the obiter dicta (by the way)
• Material facts must be very similar
• Preceding court must be superior in the hierarchy
*(Read the advantages and disadvantages of judicial precedent)
 The End

Thank you!