Książka przeznaczona jest dla prawników oraz studentów prawa, którym potrzebna jest znajomość specjalistycznego prawniczego języka angielskiego. Publikacja oparta jest na nowoczesnych metodach nauczania języków obcych. Może być pomocna w przygotowaniach do zdawania egzaminów TOLES oraz ILEC.
English is the dominant language of the international legal practice and corporate business world. Therefore, its importance cannot be underestimated and that is why the need to learn in particular the specialised legal English has been growing for the past few years. However, the language of law is much different from the every-day language irrespective of the country. What’s more, the legal concepts vary from country to country and therefore it may lead to many misunderstandings and linguistic problems which puzzle the learners.
I have written this book to assist practicing lawyers, students of law, translators as well as anyone interested in law who wish to develop their English language skills within a legal context (both for academic and vocational training purposes).
Therefore this book is intended to help understand the legal terminology and phrases as well as some major differences between both systems. Moreover, it provides the users with a chance to practice communication skills in spoken and written legal English to enable them to read and draft legal text, discuss and explain legal concepts and so to operate with confidence within the business, especially corporate, and legal environment.
The book is composed of 14 units – each unit discusses a different aspect of corporate law through introduction of relevant terminology, presentation of adequate texts, real court cases as well as numerous exercises which encourage the learner to put the newly acquired vocabulary into practice both through oral as well as written expression. Competence is developed throughout this book in a sequence of ascending complexity.
Darmowy fragment publikacji:
Małgorzata Cyganik
LEGAL
English
2nd edition
LEGAL
English
Małgorzata Cyganik
LEGAL
English
2nd edition
Wydawnictwo C. H. Beck
Warszawa 2013
Wydawca: Anna Wieczorek
Redakcja i korekta:
Dominika Baczyńska
Dominika Drygas
© Wydawnictwo C. H. Beck 2013
Wydawnictwo C. H. Beck Sp. z o.o.
ul. Bonifraterska 17, 00-203 Warszawa
Skład i łamanie: DTP Service
Druk i oprawa: Elpil, Siedlce
ISBN 978-83-255-5518-4
ISBN e-book 978-83-255-5519-1
Contents
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Unit 1:
Unit 2:
Unit 3:
Sources of Company Law \ 1
1. Introductory note \ 3
2. Text focus \ 8
3. Discussion \ 11
4. Vocabulary focus \ 12
5. Reading for detail \ 17
6. Quick quiz \ 21
7. Plain English vs. legalese \ 22
8. Rephrasing \ 26
9. Writing focus \ 27
10. Build your legal glossary \ 29
11. Branches of law \ 31
12. Unit quiz \ 32
Classification of Companies and Partnerships \ 35
1. Introductory note \ 37
2. Text focus \ 37
3. Discussion \ 43
4. Vocabulary focus \ 44
5. Choosing a form of organisation \ 47
6. Reading for detail \ 50
7. Quick quiz \ 54
8. Writing focus \ 54
9. Rephrasing \ 59
10. Build your legal glossary \ 60
11. Branches of law \ 62
12. Unit quiz \ 62
Formation and Incorporation \ 65
1. Introductory note \ 67
2. Text focus \ 71
3. Discussion \ 76
4. Vocabulary focus \ 78
5. Branches of law \ 82
6. Reading for detail \ 84
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Unit 4:
Unit 5:
Unit 6:
7. Quick quiz \ 86
8. Writing focus \ 87
9. Rephrasing \ 91
10. Build your legal glossary \ 93
11. Branches of law \ 94
12. Unit quiz \ 95
Company Governing Bodies \ 97
1. Introductory note \ 99
2. Text focus \ 100
3. Discussion \ 107
4. Vocabulary focus \ 108
5. Duties of directors \ 111
6. Reading for detail \ 115
7. Quick quiz \ 116
8. Writing focus \ 117
9. Rephrasing \ 123
10. Build your legal glossary \ 124
11. Branches of law \ 125
12. Unit quiz \ 126
The Corporate Veil \ 129
1. Introductory note \ 131
2. Text focus \ 133
3. Discussion \ 137
4. Vocabulary focus \ 138
5. Legal professions \ 141
6. Reading for detail \ 145
7. Quick quiz \ 148
8. Writing focus \ 149
9. Rephrasing \ 154
10. Build your legal glossary \ 155
11. Branches of law \ 156
12. Unit quiz \ 157
Agency \ 159
1. Introductory note \ 161
2. Text focus \ 164
3. Discussion \ 168
4. Vocabulary focus \ 169
5. Court systems \ 172
6. Reading for detail \ 179
7. Quick quiz \ 181
8. Writing focus \ 181
9. Rephrasing \ 185
10. Build your legal glossary \ 186
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Unit 7:
Unit 8:
Unit 9:
Unit 10:
11. Branches of law \ 188
12. Unit quiz \ 188
Consolidation \ 191
Ultra Vires Doctrine \ 205
1. Introductory note \ 207
2. Text focus \ 207
3. Discussion \ 210
4. Vocabulary focus \ 210
5. Civil litigation \ 214
6. Reading for detail \ 218
7. Quick quiz \ 222
8. Rephrasing \ 223
9. Writing focus \ 226
10. Build your legal glossary \ 229
11. Branches of law \ 230
12. Unit quiz \ 231
Company Financial Structure \ 235
1. Introductory note \ 237
2. Text focus \ 240
3. Discussion \ 243
4. Vocabulary focus \ 244
5. Going public and insider trading \ 248
6. Reading for detail \ 251
7. Quick quiz \ 252
8. Writing focus \ 253
9. Rephrasing \ 256
10. Build your legal glossary \ 257
11. Branches of law \ 259
12. Unit quiz \ 259
Corporate Financial Statements \ 261
1. Introductory note \ 263
2. Text focus \ 265
3. Discussion \ 270
4. Vocabulary focus \ 271
5. Taxes \ 274
6. Reading for detail \ 277
7. Quick quiz \ 279
8. Writing focus \ 280
9. Rephrasing \ 283
10. Build your legal glossary \ 283
11. Branches of law \ 285
12. Unit quiz \ 286
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Unit 11:
Unit 12:
Unit 13:
Unit 14:
Answer Key \ 397
M A and Reorganisations \ 289
1. Introductory note \ 291
2. Text focus \ 292
3. Discussion \ 299
4. Vocabulary focus \ 300
5. Alternative Dispute Resolution \ 303
6. Reading for detail \ 306
7. Quick quiz \ 311
8. Writing focus \ 311
9. Rephrasing \ 313
10. Build your legal glossary \ 314
11. Branches of law \ 316
12. Unit quiz \ 316
Corporate Contracts \ 319
1. Introductory note \ 321
2. Text focus \ 324
3. Discussion \ 328
4. Vocabulary focus \ 328
5. How to secure a contract? \ 332
6. Quick quiz \ 335
7. Reading for detail \ 336
8. Rephrasing \ 344
9. Writing focus \ 345
10. Build your legal glossary \ 348
11. Branches of law \ 350
12. Unit quiz \ 351
Insolvency and Winding-up \ 353
1. Introductory note \ 355
2. Text focus \ 357
3. Discussion \ 361
4. Vocabulary focus \ 362
5. Sample statement of claim for debt recovery \ 365
6. Reading for detail \ 368
7. Writing focus \ 372
8. Quick quiz \ 377
9. Rephrasing \ 378
10. Build your legal glossary \ 379
11. Branches of law \ 380
12. Unit quiz \ 381
Consolidation \ 385
Unit 1
Sources of Company Law
Contents:
1. Introductory note \ 3
– Introduction
– Definition of law
2. Text focus \ 8
Company law
3. Discussion \ 11
Scope of company law
1
4. Vocabulary focus \ 12
– Legal acts
– Types of business entities
– Confusing words
a) prescribe, proscribe, ban
b) delete, waive, set aside, repeal, cease, resign
c) set forth, provide, stipulate
5. Reading for detail \ 17
6. Quick quiz \ 21
7. Plain English vs. legalese \ 22
– Legalese and grammar – modal verbs and legalese
8. Rephrasing \ 26
9. Writing focus \ 27
10. Build your legal glossary \ 29
11. Branches of law \ 31
The constitutional law
12. Unit quiz \ 32
Introductory note
Practice 1
Before you read, think how law is created and what the sources of law in the legal system of your country
are. While reading, try to answer these questions:
1. What is the major difference between the Anglo-Saxon and continental law?
2. Which type of law, enacted or common, prevails in the Anglo-Saxon system?
3. What is a precedent?
4. How do the courts influence the law both in the Anglo-Saxon and continental systems?
5. What is a custom?
In the United Kingdom and in the United States of America, the system of law is divided into
enacted law (the law contained in law-making instruments, a.k.a. statutory law) and com-
mon law1 (especially a major part of the law in nations with a history as British territories or
colonies. It includes extensive non-statutory law reflecting precedent derived from centuries
of judgments by judges hearing real cases).
In the United Kingdom enacted law is composed of the Acts of Parliament and so-called
delegated legislation (a.k.a. subordinate delegation), which includes statutory instruments,
such as rules, orders or regulations issued by a government or its agencies. These laws do not
necessarily apply to the entire area of the United Kingdom – their scope may cover the terri-
tory of England and Wales, Scotland and/or Northern Ireland – and the area covered by the
particular law is determined in the document. Another important feature of the English legal
system is the lack of a written constitution. It is an area of uncodified law, consisting of both
written and unwritten sources. There is no technical difference between ordinary statutes and
law considered “constitutional law”. The lack of a central written constitutional document
explaining the fundamental principles of the state and the relationship between its institu-
tions and between the people leads some constitutionalists to regard the United Kingdom as
having “no (formal) constitution”. The phrase “unwritten constitution” is sometimes used,
despite the fact that the UK constitution incorporates many written sources, statutory law
being considered the most important source of the constitution. But it remains the case that
the constitution relies far more on unwritten constitutional conventions than virtually any
other liberal democratic constitution.
Common law in the UK comprises two important elements: common law based on the rules
of law built upon decisions of courts [precedents] (a judicial judgment includes ratio decidenti
1 It is also referred to as judge-made law, case law, decisional law or precedent law.
3
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and obiter dictum; ratio decidenti is the source of law to be applied by subsequent judges and
includes the motive which determined the judgment; obiter dictum consists of a judge’s opinion
on this particular case) and the rules of equity which constitute a set of legal principles that
are also applied in the countries that follow the British common law tradition. Rules of eq-
uity supplement the strict application of the rules of law where this application is considered
harsh, so as to achieve so-called “natural justice”. As law applies legal doctrines or statutes to
judge a particular case, equity, with its emphasis on fairness and flexibility, has only general
guidelines, known as the maxims of equity. In modern practice, the most important distinc-
tion between law and equity is the set of remedies (measures employed to enforce a right
or redress, i.e. compensate for, an injury) each offers (for example a court of law can award
financial damages whereas equity enters injunctions or decrees that either direct someone to
act or forbid them from acting). Only a judge can dispense equitable remedies, as it is a matter
of law. The distinction between “legal” and “equitable” remedy (a.k.a. relief) is an important
aspect of common law systems, including the American legal system. In the event that the
enacted law does not deliver a norm of conduct in a given case, a norm of precedent applies
and if there is no such norm, then the judge hearing the case lays down a new precedent. We
also must not forget about the importance of a custom in common law as a basis for so called
implied terms, which derive directly from the letter of law or a custom as opposed to explicit
terms (a.k.a. express terms), the terms included in a particular document in black and white.
American common law derives from British common law and law of equity. In the United
States of America enacted law is composed of a number of law-making instruments2, such
as the Federal Constitution, statutes, executive orders, rules, regulations and ordinances.
Moreover, the legal system is divided into federal and state law. The state statutes constitute
an important part of enacted law in the USA. However, although a few uniform acts which aim
to unify the U.S. law do exist (e.g. the RMBCA3), not all states have adopted them. Similarly
to the UK, common law applies in cases not governed by enacted law. The usage of a habitual
or customary practice also constitutes an important element of American law.
Moreover, in the Anglo-Saxon system of law, the judgments are binding: (a) only upon the
courts of a lower instance than the court which pronounced it and only on the courts of the
same state (except for the federal courts) (b) if they are holdings included in opinions of ap-
pellate courts i.e. courts of higher instance to which an appeal may be lodged. Polish law is
formed exclusively by enacted law. The main sources of Polish law are: the Constitution, acts
and ordinances. Precedent law does not exist in the Polish legal system although the judicature
(i.e. rulings and resolutions of courts designated to administer justice) of higher courts and
tribunals (e.g. the Constitutional Tribunal, the Supreme Court, the Supreme Administrative
Court), whose rulings are not law-creating and refer only to a particular case, de facto play an
2 A.k.a. legal acts, legislative documents.
3 The Revised Modern Business Corporation Act.
important role in the interpretation of the above-mentioned legal acts. Exceptions include the
Resolutions of the Seven Justices of the Supreme Court which became a rule of law. Moreover,
the Civil Code provides for the application of principles of community life (i.e. principles
which individuals must obey in order not to violate the rights of other members of the society)
and commonly-accepted customs.
Additionally, as far as Polish and British law are concerned, we must not forget about the role
of the European Union law and the impact of its binding instruments, such as regulations,
directives and decisions, on those legal systems.
Practice 2
Choose the correct answer:
1. Anglo-Saxon law
a. is contained in written and
b. is based on precedents
c. is created by courts
unwritten rules
2. Delegated legislation is contained in
a. acts enacted by Parliament
b. documents issued by
public authorities other
than Parliament
c. orders of the Council of
Ministers
5
3. The courts in Poland
a. participate in the creation
b. have great influence on the
c. show how law should be
of new laws
legal system
interpreted
4. The UK
a. does not have a Constitu-
b. has a written Constitution
tion
c. has a Constitution which
relies on unwritten con-
ventions and other docu-
ments
5. Uniform acts in the USA
a. must be adopted by all the
b. are a part of federal law
c. try to unify law within the
states
country
Sources of Company Law Practice 3
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On the basis of the above text define the following terms:
a. enacted law
b. common law
c. precedent
d. implied terms
e. explicit terms
f. custom
g. legal acts
h. binding
i. appellate courts
6
j.
judicature
k. principles of community life
l. uniform act
m. regulation
n. directive
o. decision
Practice 4
Every legal system contains regulations designed to govern the conduct of people. Below you will find several
short definitions of law and law-related terms. Decide which definition is the most accurate and justify your
choice. Find the best definition:
1. Law
(a) is formed by a set of rules and norms of conduct
(b) lays down the rules which prohibit, permit or regulate particular actions and relationships among
various persons/entities
(c) is designed to eliminate, minimise and punish the breaking of commonly accepted rules and to
bring about justice
(d) is divided into substantive and procedure laws
(e) is administered by a system of courts and representatives of public administration
(f) all of the above
2. Separation of Powers
(a) the division of authority into legislative, executive and judicial branches vested in particular state
authorities by the national constitution
(b) the division of rights between the members of an organisation
(c) another term for “corporate governance”
3. Legislative initiative
(a) the power granted by a competent state authority to propose legislation
(b) the power granted by the constitution to propose legislation
(c) the proposal of a new law (known as a bill)
7
4. Applicable provisions of law
(a) legal stipulations which regulate the mode of conduct in a particular situation
(b) rules which are prescribed by law and have to be absolutely followed and obeyed in any situation
(c) rules of law which are relevant in a particular case and which bind the persons involved in the
activity described by these rules
5. Administration of law
(a) directing and controlling the implementation of the law
(b) public authorities responsible for creating the law
(c) ruling
6. Enforcement of law
(a) compelling observance of the law
(b) implementing the law
(c) causing a legal action to happen by force
Sources of Company Law 1
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Text focus
Company law4
Company law concerns the forming, organising, operating, merging, dividing and winding-up
of companies5. Moreover, it governs the relationships among various constituents of a com-
pany, i.e. members of its governing bodies. Company law is also sometimes strictly connected
to securities law, which governs the conditions whereunder companies may issue shares and
raise capital, and bankruptcy law, which lays down the procedures to be followed in the event
a company gets into severe financial trouble.
A company (AmE: corporation) is a legal entity created under the laws of the country or state it
is incorporated within; although it is a legal artifice, it can be compared to an “artificial person”
that can sue or be sued, conclude contracts, and perform other actions necessary to conduct
its business operations. It has a separate legal identity from its members (owners/sharehold-
ers). Although the term “company” refers only to incorporated entities, colloquially it is often
used to refer to any business entity (e.g. it is often used to refer to Polish partnerships since
both companies and partnerships are regulated by one and the same code).
8
The UK
sole trader
partnership
– general partnership
– limited partnership
– limited liability partnership
company
– private limited by shares (Ltd.)
– private limited by guarantee (Ltd.)
– private unlimited company (Ltd.)
– public limited company (PLC)
In the UK, a company in the legal context means an entity formed and registered under the
Companies Act or an existing company (a company formed on the basis of previously existing
4 AmE: the corporate law or corporation law; Pl: partnerships and companies law (a.k.a. commercial com-
panies law).
5 In Poland also partnerships, as the companies and partnerships are governed by the same Code of Partner-
ships and Companies (a.k.a. Commercial Companies Code).
acts), registered in the Registrar of Companies held by Companies House6. The UK company
law is mainly a creature of statute and the most important statute is the Companies Act7.
English business entities may adopt the following legal structures: from the sole trader, through
partnerships (general, limited and limited liability) to companies (private limited by shares
or by guarantee or unlimited company, or a public company).
The USA
limited liability
company
(LLC)
sole
proprietor
partnership
– general partnership
(GP)
– limited partnership
(LP)
– limited liability
partnership (LLP)
– limited liability limited
partnership (LLLP)
corporation
– private
– public
– S corporation
(for tax purposes
the status of C
corporation may be
chosen)
9
In the United States, the term “corporation” generally refers to incorporated business entities,
or entities chartered under the laws of a particular state. The corporate law of a state where
a corporation was incorporated generally governs that corporation (even if the corporation’s
operations take place outside that state8). Despite some attempts to unify corporate law in the
USA (e.g. the Revised Model Business Corporation Act9, which was adopted by many states),
the corporate laws of various states differ. Therefore, some states, notably Delaware, are more
attractive for businessmen than others and for this reason most American public corporations
have been incorporated there. The federal law of the United States and local laws may also
form applicable sources of corporate law. Business entities in the USA may take the form of
a sole proprietorship, partnerships (general partnership, limited partnership, limited liability
partnership and limited liability limited partnership), a limited liability company (LLC), and
corporations (private and public) including S corporation and C corporation which are subject
to different taxation rules. All these business entities are governed by a separate relevant statute.
6 www.companieshouse.gov.uk (all internet links were last verified on 27 June 2013).
7 It may be downloaded at www.opsi.gov.uk.
8 A corporation which operates in the state of domicile is called a domestic corporation, and a corporation
which operates in another state, in that state is referred to as a foreign corporation.
9 It may be found at www.americanbar.org/resources_for_lawyers.html (all internet links were last reviewed
on 27 June 2013).
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Poland
sole
proprietor
partnership
– general partnership
– limited partnership
– professional
partnership
– limited joint-stock
partnership
company
– limited liability
company
– joint-stock company
• listed
• unlisted
private business
partnership
In Poland, the Code of Partnerships and Companies10 governs the formation, existence and
termination of commercial law business entities, which are divided into partnerships and
companies. The Code of Partnerships and Companies applies to both groups of these business
entities. However, there is another important source of law, the Civil Code, which governs
private business partnerships. This type of business entity is not a legal entity but constitutes
an agreement between two or more individuals who aim to achieve a common objective.
Polish commercial law business entities are divided into partnerships (general partnership,
professional partnership, limited partnership, limited joint-stock partnership) and companies
(a limited liability company and a joint-stock company which may be listed or unlisted i.e. its
shares may be traded (or not) on the stock exchange market).
Practice 5
Decide whether the following statements are true or false:
1. In the legal context, a sole trader is a company.
2. Federal law is a key element of American corporate law.
3. Relations between a company and its directors are determined by company law.
4. The English (BrE) term “company” means an entity incorporated under the
Companies Act.
5. “Corporation” is an American term for a “company”.
6. Some states, such as Delaware, are more attractive for business than other.
7. The Revised Model Business Corporation Act has not been adopted
by all the U.S., states.
T / F
8. Delaware’s corporate law is very attractive for the incorporation of a corporation.
10 Also called the Commercial Companies Code.
9. Polish private partnerships are governed by the Code of Partnerships and
Companies.
T / F
10. Poland’s so called Commercial Companies Code applies to both companies and
partnerships.
Practice 6
Match the terms with the definitions:
1. formation
2. merger
3. private company
4. public company
5. raise capital
6. securities law
a. a company whose shares are not offered to the general public
b. liquidating the company’s affairs
c. a holder of a company’s equity
d. the law governing the trade in e.g. shares
e. in general, the process of two entities becoming one
f. a company listed on the stock exchange whose shares are offered to
the general public (not to be confused with a state-owned company)
7. shareholder
8. winding-up
g. the process of creating and incorporating an entity
h. to acquire capital from e.g. shareholders’ contributions, bank loans or
11
from the general public
Discussion
Scope of company law
Decide which areas are covered by company law; prepare a brief overview for a potential client; try to use
the phrases given below:
• company formation
• penal liability
• merger
• division
• organisation
• management
• trading in securities
• contract formation
• profit-sharing
• resolving disputes
• performing contracts
• acquiring goods
• declaring insolvency
• finance raising
Sources of Company Law
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