CORPORATE AND BUSINESS LAW

Sources of Law - Legislation

Legislation

• Legislation is derived from the Latin word ‘Legis’ and ‘Latum. Which means ‘law’ and ‘to make’.
Thus legislation means making of law.
• It is a source of law where there is a declaration of legal rules by a competent authority
• They make rules by keeping them in mind that the rules must be for the welfare of the citizens and it
must be adopted for the interest of the citizens

Advantages

• Abrogative power – it can change or annul old laws

• Effectiveness
• Declaration – the laws are made from the authorized source
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Sources of Law - Legislation

Disadvantages

• Inflexible nature
• In view of Hypothesis
• An excessive amount of importance to the wording

Legislation falls under 2 categories:

1. The crown
2. The House of Lords
3. The House of Commons

A statute begins its life as a bill. A bill may be introduced into either House of Parliament but must pass
through both the houses. A statute is a law enacted directly by the parliament or indirectly under
parliament authority.
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Sources of Law - Legislation

Each parliament is sovereign:

a. To introduce new rules (e.g. small business, enterprise and employment act, 2015)
b. To repeal old laws that have become obsolete (e.g. The European Union (Withdrawal) Act) 2019)
c. To codify case laws in to statutory form (consumer rights act, 2015)
d. To consolidate existing legislation on the same subject matter into a single statute

Statutes are absolutely binding on everyone with their jurisdiction and can override case law.
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Sources of Law - Legislation

Procedure for introducing the bill in the House of Commons

1. First reading: formal announcement that the bill has been presented
2. Second reading: The debate stage where the purpose of the legislation is dismissed
3. Committee stage: Normally a standing committee is established to consider the bill clause by clause
4. Report stage: a review of the bill as amended by committee, a new amendment may be added.
5. Third reading: the house reviews the amendments and permits it to proceed to the next House or
not at this state, substantive amendments cannot be made.

Procedure for introducing the bill in the House of Lords

1. The standard House of Lords Procedure is basically the same as in the Commons. However after the
second reading in the House of Lords, Bills are committed to a committee of the whole house.
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Sources of Law - Legislation
Royal Assent

When a bill has passed all stages in Both Houses, the Queen signs the bill and it becomes an act of
parliament. The dates date of Royal assent is published in the act.

Doctrine of Sovereignty of Parliament

It is a fundamental principal that has shaped the constitutional frameworks of various democracies. UK
embraced its concepts into entirety while India have adopted a more nuanced approach that balances
parliamentary sovereignty with constitutional supremacy and judicial oversight.

Features include:
• Supreme Legal Authority
• Legislative Supremacy
• Absence of Legal Limits
• Unlimited Jurisdiction and Non- Judicial Intervention
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Sources of Law - Legislation
Delegated Legislation

• It is a legislation that denotes 2 senses. In one sense, it means the exercise of powers of rule-making by
the executive under the authority delegated to it by the legislature.
• In other sense when the function of legislation is entrusted to organs than the legislature itself the
legislation made by such organs is called delegated legislation which may be in the form of rules,
regulations, by-laws, orders, schemes, directions, circulars notifications, etc.
• For example, bylaws: Some autonomous bodies such as the ACCA or General Medical Council have
power granted by parliament to create their bye-laws for the regulations of their members.

Advantages Disadvantages
• Saves the time of parliament • Lack of Publicity

• Access to technical assistance and flexible • At times undemocratic

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Sources of Law - Legislation
Control of Delegated Legislation

I. Parliamentary – since 1973 there has been a Joint Select Committee on Statutory Instruments whose
function it is to scrutinize all the statutory instruments. They have the power to draw the instruments
to the attention of both Houses on any number of grounds, but cannot do so on a ground which is
relating to the actual merits of the instruments or the policy it is pursuing.
II. Judicial – The court can challenge the validity of delegated legislation through the process of judicial
review. It can be challenged on the ground that the person making the act is ‘Ultra Vires’ i.e.
exceeding their authority.

Ultra vires are of two types:

1. Procedural Ultra Vires

2. Substantive Ultra Vires
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Sources of Law - Legislation

1. Procedural Ultra vires – when a piece of delegated legislation is deemed to have not followed the
correct procedure that was required by the enabling act.

Agriculture Horticulture & Forestry Industry Training Board v. Aylesbury Mushroom Ltd. 1972

The Labor Minister failed to observe the prescribed procedure for introducing regulations. The Minister
did not ask the Mushroom Grovers Association when the delegated legislation relating to them was made.
It was challenged in the case

2. Substantive Ultra Vires – when a piece of delegated legislation is deemed to be void because it places
provisions on an area beyond the powers given to the decision-maker by the Enabling Act.

In Strickland v Hayes Borough Council (1986) a local authority had introduced a bye-law prohibiting
the singing or reciting of obscene songs or use of obscene language. This was held to be ultra vires, on the
basis that the bye-law was too widely drafted because it covered acts carried out on private property as
well as public land.