Question

Describe the hierarchy of the sources of law. Provide an example of a law or regulation from each source and how it impacts the business world.

Answer 1

• There are basically three sources of law and they are as follows:-

1. Customs:- These are considered as the oldest source of law and it is based on the customs that we have followed from the ancestors by keeping the practices in mind. Customs are the practices which were considered morally and ethically good or bad. Example: Certain acts under the customs are considered as sin and in today's business world also it is considered as illegal or unlawful. Customs show that promises must be kept or they must be made in a bonafide manner. In today's business and iternational law there is a maxim i.e. pacta sunt servanda which means agreements must be kept.
2. Treaties:- It is also considered as one the most important source of law. Treaties can be called as agreements or conventions in which two or more party agrees and are bound by the clauses of such agreement or convention. Example: Under business law also there are contracts among the parties and the clauses under the contract makes the parties bind to follow the contract and act accordingly.
3. General Principles of Law:- It is also a source of law i.e. primary source of law. These are those principles which are followed by majority of civilized nation. Certain acts which are considered as void or are against the principles of law then those acts are not considered legal. Example: If the contract is regarding invalid object i.e. fraud or misappropriation in the accounts of company then it will be considered as an unlawful contract as it is against the principles of law.