Business Law Discussion Notes 2024

COLLEGE OF BUSINESS MANAGEMENT BSBA-MAJOR IN MARKETING Grading System Particulars Percentage Midterms 30% Finals 30% Class Participation 35% - Recitation 20% - Assignment/Activity 10%...

COLLEGE OF BUSINESS MANAGEMENT BSBA-MAJOR IN MARKETING Grading System Particulars Percentage Midterms 30% Finals 30% Class Participation 35% - Recitation 20% - Assignment/Activity 10% Attendance 5% Total 100% Course Description Introduces legal principles that govern business transactions and operations to students. Students will analyze legal cases, engage in discussions, and apply legal concepts to real-world scenarios. Topics include obligations and contracts, tort law, agency and business organizations, etc. Course Objectives Understand fundamental legal concepts and principles relevant to business Analyze and interpret legal issues that arise in business transactions Apply legal reasoning to complex business problems Evaluate ethical considerations Communicate legal concepts and analysis effectively Coverage (Midterm) I. Introduction to Law and Business Law II. Obligations and Contracts III. Tort Law and Business Liability IV. Agency and Business Organizations Coverage (Finals) I. Intellectual Property II. Ethical Considerations in Business Law III. International Business Law IV. Emerging Legal Issues and Future Trends V. Labor and Employment in the Philippines VI. Taxation and Regulatory Compliance Coverage (Midterm) Learning Topics to be Objectives Discussed 1) Law 2) Sources of law and their application I Introduction to Law in business and Business Law 3) Business Law 4) Role of law in Philippine business and commerce Coverage (Midterm) Learning Topics to be Objectives Discussed 1) Obligation 2) Contract II Obligations and 3) Essential elements of a valid Contracts contract 4) Types of contracts and their enforceability 5) Contract remedies and performance 6) Remedies for breach of contract Coverage (Midterm) Learning Topics to be Objectives Discussed 1) Negligence, strict liability and intentional torts III Tort and Business 2) Defenses and remedies in tort cases Liability 3) Product liability and consumer protection 4) Elements of negligence and defenses 5) Principles of damages and compensation Coverage (Midterm) Learning Topics to be Objectives Discussed 1) Agency 2) Corporation IV Agency and 3) Partnership Business 4) Other business organizations Organizations 5) Comparison; elements; and other related matters BUSINESS LAW CORE 5 BSBA-MM C2021 Saturday, 2:30PM to 5:30PM References: Introduction to Law, Suarez Rolando A., Sixth Edition Reviewer in Commercial Law, Sundiang Sr. and Aquino Republic Act No. 386 or the New Civil Code of the Philippines Republic Act No. 11232 or the Revised Corporation Code of the Philippines DEFINITION OF LAW It is a rule of conduct, just and obligatory, laid down by a legitimate authority for common observance and benefit. (Sanchez Roman, 23) ELEMENTS ✓ It is a rule of conduct ✓ Law must be just ✓ It must be obligatory ✓ Laws must be prescribed by legitimate authority ✓ Laws must be ordained for common benefit ELEMENT ✓ It is a rule of conduct Serves as guides of an individual in relation to his fellowmen and to his community ELEMENT ✓ Law must be just ✓ Laws as guides for human conduct "should run as golden threads through society, to the end that law may approach its supreme ideal which is the sway and dominance of justice” Report of the Code of Commission, p.39 Note: The phrase suggests that certain principles or values, often symbolized as "golden threads," should permeate society. These principles aim to ensure that the law moves closer to its ultimate goal, which is the prevalence and influence of justice in society. In other words, it emphasizes that justice should be a guiding principle in the development and application of laws. ELEMENT ✓ It must be obligatory If laws are not enforced, the purpose for which they are intended will not be served. ELEMENT ✓ Laws must be prescribed by legitimate authority If laws are not prescribed by legitimate authority, the people could not be expected to observe them. “Sovereignty resides in the people and all government authority emanates from them. ELEMENT ✓ Laws must be ordained for common benefit “Salus Populi Est Suprema Lex” – the welfare of the people shall be the supreme law. Laws should be applied not only to a particular group of citizens. They are supposed to be applied equally to all citizens regardless of their religion, political persuasion, and status in life. SOURCES OF LAW ▪ Legislation ▪ Precedent ▪ Customs ▪ Court Decision SOURCE OF LAW ▪ Legislation – Congress SOURCE OF LAW ▪ Precedent – decisions or principles enunciated by a court of competent jurisdiction on a question of law do not only serve as guides but also as authority to be followed by all other courts of equal or inferior jurisdiction in all cases involving the same question until the same is overruled or reversed by superior court. SOURCE OF LAW ▪ Customs have the force of law only when they are acknowledged and approved by society through long and uninterrupted usage SOURCE OF LAW ▪ Court Decision - Judicial decisions which apply or interpret the Constitution and the laws are part of the legal system in the Philippines but they are not laws. However, although judicial decisions are not laws, they are evidence of the meaning and interpretation of laws. Doctrine of “stare decisis” once the case has been decided one way, then another case involving exactly the same question or point of law should be decided in the same manner. BUSINESS LAW This pertains to the rules, regulations, and legal principles governing businesses and commercial transactions. BUSINESS LAW Topics include: 1. Obligations and Contracts 2. Business Organizations such as Corporation, Partnership 3. Intellectual Property 4. Labor and Employment 5. Consumer Protection 6. International Business Law MARKETING MANAGEMENT It refers to the process of planning, executing, and controlling and organization’s marketing activities to achieve the company’s/business’ objectives. It involves the strategic planning and implementation of marketing strategies, tactics, and campaigns to promote products or services of the company/business effectively in the marketplace. MARKETING MANAGEMENT Key aspects: 1) Strategic planning 2) Market Research 3) Advertising and Promotion 4) Product and Service Development 5) Customer Relationship Management BUSINESS LAW vis-à-vis MM Understanding business law is essential for business owners, managers, and professionals to operate within legal boundaries and protect their interest. BUSINESS LAWS AND REGULATIONS Business Law Governing Law Provision Obligations and Contracts New Civil Code of the Philippines Book IV – Title I to III Agency New Civil Code of the Philippines Book IV – Title X Business Organizations a. Sole Proprietorship b. Partnership New Civil Code of the Philippines Articles 1767 to 1867 of Title IX, Book IV c. Joint Venture New Civil Code of the Philippines; Law Kilosbayan vs. Guingona, 232 SCRA 110 on Partnership (1994); Aurbach, et al. vs. Sanitary Wares Manufacturing Corporation, 180 SCRA130 (1989) d. Corporation Republic Act No. 11232 or the Revised Corporation Code of the Philippines Tort Law New Civil Code of the Philippines Article 2176; Article 1173 BUSINESS REGISTRATION Business Law Government Agency Business Organizations a. Sole Proprietorship Department of Trade and Industry b. Partnership Securities and Exchange Commission c. Joint Venture d. Corporation Securities and Exchange Commission  OVERVIEW (based on the coverage of Midterms) Obligations & Contracts OBLIGATION An obligation is a juridical necessity to give, to do or not to do. – Article 1156, New Civil Code of the Philippines CONTRACT A contract is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service. – Article 1305, New Civil Code of the Philippines Tort Law QUASI-DELICT Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-delict and is governed by the provisions of this chapter. – Article 2176, New Civil Code of the Philippines QUASI-DELICT Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-delict and is governed by the provisions of this chapter. – Article 2176, New Civil Code of the Philippines Quasi-delict is used to designate those obligations which do not arise from law, contracts, quasi-contracts or criminal offences. The concept of liability in quasi- delictual cases is embodied in Chapter 2, Title XVII of the Civil Code. NEGLIGENCE The fault or negligence of the obligor consists in the omission of that diligence which is required by the nature of the obligation and corresponds with the circumstances of the persons, of the time and of the place. – Article 1173, New Civil Code of the Philippines Agency AGENCY By the contract of agency a person binds himself to render some service or to do something in representation or on behalf of another, with the consent of the latter. – Article 1868, New Civil Code of the Philippines Business Organizations TYPES 1) Sole Proprietorship 2) Partnership 3) Joint Account 4) Business Trust 5) Joint Venture 6) Cooperative 7) Corporation SOLE PROPRIETORSHIP A person personally conducts business under his name or a business name. The business is an organization composed of the proprietor himself and employees but it has no personality separate and distinct from the proprietor. Note: A sole proprietor does not possess a juridical personality. SOLE PROPRIETORSHIP Business name refers to any name that is different from the true name of an individual which is used or signed in connection with her/his business on any written or printed receipts including receipts for business taxes, duties and fees and withdrawal and delivery receipts; any written or printed evidence of an agreement or business transaction; and any billboard conspicuously exhibited in plain view in or at the place of her/his business or elsewhere, announcing her/his business. SOLE PROPRIETORSHIP Proprietor is required to register the business name OTHER THAN HIS TRUE NAME. If not registered: He cannot use or sign the business name in connection with his business on any written or printed receipts on any evidence of agreement or other documents He cannot exhibit the business name or sign thereof in plain view SOLE PROPRIETORSHIP PROHIBITED BUSINESS NAME 1) The name or the nature of business itself is illegal, offensive, scandalous, or contrary to propriety 2) Names which are identical or resemble a business name already registered to any government office authorized by law to register names, as likely to cause confusion or mistake in the minds of the public taking into consideration the following: SOLE PROPRIETORSHIP Nature of the business Product/service handled Location/place of business Dominant word Use of descriptive words Spelling, sound and/or meaning SOLE PROPRIETORSHIP PROHIBITED BUSINESS NAME 3) Names composed of purely generic or geographic words 4) Names which by law or regulation cannot be appropriated 5) Names, words, or terms or expressions used to designate or distinguish or suggestive of quality of any class of goods, articles, merchandise or service SOLE PROPRIETORSHIP PROHIBITED BUSINESS NAME 6) The names or abbreviation of names used by the government in its governmental functions 7) The name or abbreviation of names of any national, inter- governmental or international organization 8) Names which are deceptive, misleading or which misrepresent the nature of the business SOLE PROPRIETORSHIP JURIDICAL PERSONALITY Article 44. The following are juridical persons: 1) The State and its political subdivisions; 2) Other corporations, institutions and entities for public interest or purpose, created by law; their personality begins as soon as they have been constituted according to law; 3) Corporations, partnerships and associations for private interest or purpose to which the law grants a juridical personality, separate and distinct from that of each shareholder, partner or member. SOLE PROPRIETORSHIP JURIDICAL PERSONALITY Article 46. Juridical persons may acquire and possess property of all kinds, as well as incur obligations and bring civil or criminal actions, in conformity with the laws and regulations of their organization. - New Civil Code of the Philippines SOLE PROPRIETORSHIP JURIDICAL CAPACITY Article 37. Juridical capacity, which is the fitness to be the subject of legal relations, is inherent in every natural person and is lost only through death. Capacity to act, which is the power to do acts with legal effect, is acquired and may be lost. - New Civil Code of the Philippines Partnership PARTNERSHIP Article 1767. By the contract of partnership two or more persons bind themselves to contribute money, property, or industry to a common fund, with the intention of dividing the profits among themselves. Two or more persons may also form a partnership for the exercise of a profession. - New Civil Code of the Philippines Joint Accounts JOINT ACCOUNTS An arrangement whereby merchants may interest themselves in the transaction of other merchants, contributing thereto the amount of capital they may agree upon, and participating in the favorable and unfavorable results thereof in the proportion they may determine. This is commonly called an accidental partnership. JOINT ACCOUNTS vs. PARTNERSHIP As to juridical personality. A joint account has no juridical personality while a partnership has a personality separate and distinct from the partners. As to business name. No commercial name common to all participants can be adopted in joint accounts. A partnership can adopt a partnership name. As to management. The general partners are all managers in the partnership while only the ostensible partner manages and transacts business in his own name and under his individual liability. Business Trusts BUSINESS TRUSTS It is a legal relation whereby one person, called the trustor, conveys a property to another for the benefit of a person called the beneficiary. The person in whom confidence is reposed as regards the property is called the trustee. Joint Venture JOINT VENTURE An association of persons or companies jointly undertaking some commercial enterprise; generally all contribute assets and share risks. It requires a community interest in the performance of the subject. A right to direct and govern the policy connected therewith, and duty, which may be altered by agreement to share both in profit and losses. a) A joint venture is actually a form of partnership and should be governed by the laws of partnership b) Corporations can enter into joint venture agreement c) Joint venture may result in a formation of joint venture corporation Cooperatives COOPERATIVES is an autonomous and duly registered association of persons with a common bond of interest, who have voluntarily joined together to achieve their social, economic, and cultural needs and aspirations by making equitable contributions to the capital required, patronizing their products and services and accepting a fair share of the risks and benefits of the undertaking in accordance with universally accepted cooperative principles. Corporation CORPORATION Section 2. Corporation defined. - A corporation is an artificial being created by operation of law, having the right of succession and the powers, attributes and properties expressly authorized by law or incident to its existence. - Revised Corporation Code of the Philippines Thank you.