Acme Organization: Company Analysis

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Common Law or the Uniform Commercial Code (UCC)

Many business entities around the world are administered, inspected, or guided by different types of laws. Such regulations keep them in alignment whenever they are operating or performing their activities. However, the two major business laws are common law and the universal commercial code. Regarding the Acme organization, the most prevalent one is commercial law. This can be seen in instances where, for example, in its case, the firm does not deal with businesses located in other states, but only those in the same region.

The common form of law is often used by most business entities. The legislation is sometimes conventional, but it continues to evolve. To understand better, Common law is a collection of unwritten rules centered on court-established legal rulings. In extreme scenarios where the result cannot be decided based on current legislation or written regulations of law, common law influences the decision-making process. Therefore, Acme fireworks is a business organization that is still in the developing stages but trying to change its nature from a sole business entity to a partnership business (Niziołkiewicz, 2019). Consequently, the critical law that regulates and governs its business activities is common law.

Finding out Whether There Existed a Contract and Applying of the Five Essential Elements of an Enforceable Contract

The owner of the Acme fireworks and the company entered into an agreement but did not enter into a contract as there were no elements of a contract between them. For instance, the purpose of a legal arrangement between the two parties was lacking. Regarding the agreement, it is clear that the company and the proprietor agreed on the price to be paid when the fireworks were to be displayed. The two proceeded to deliberate on how the expenses are undertaken for the fireworks would be utilized (Starr, 2017). They agreed to use a large percentage on catering for the insurance cover, experienced labor, and tangible service of

setting off the firecrackers. Both the proprietor and the company accepted and considered the offer. Therefore, it is apparent that there was no contract between the two. It is also distinctly noticeable that the two parties did not stick to all the required elements of the deal (Meagher, 2018). The following aspects are normally included in the contract components; the intention to establish legal relationships, the offer, approval of the terms, consideration of the offer and, lastly, the ability to make offers.

In the Acme Fireworks’ case, the main aspect of the contract which was not present in the negotiations, was the lack of a legal binding relationship between the two. Which if it had existed, it would have prohibited either of the two parties to act against their mutual agreement. It is the main reason the proprietor is concerned about the possibility of the company stopping the ordering of fireworks.

Personal Liability to Acme Fireworks in Case of an Injury Caused a Stray Firework from a Fireworks Display

Personal responsibility is a financial burden, for which persons or entities assume accountability and which may also be fulfilled based on their own assets or possessions. The owner of Acme fireworks is liable for the responsibility in a situation where a spectator is hurt during the firework show. Since his business is a private company, the business proprietor is personally accountable because he is the sole proprietor of the company. Even though he has employed other workers in the organization, he is actively and personally involved in the daily running of the business operations.

It is also worth noting that differentiating between a business entity and the real business owner in a sole-proprietorship type of business is generally difficult. The sole proprietorship of the organization rests on one individual who stands to be his own boss. In the above situation, however, the hurt individual is supposed to be compensated by the possessor of Acme fireworks, despite being a third party. But should the company and businessman be in a position to have a good relationship with the injured spectator, they could then determine whether to compensate or resolve the incident without compensation.

If a company liability arises in the sole proprietorship, the owner is fully responsible for any damage or accident incurred by the business, as he happens to be jointly responsible. It is also essential for Acme fireworks to register with personal liability insurance cover. In the event of injury or damage to any involved party, the cost of liability will be entirely compensated for by the insurance, thus, minimizing the financial burden of the company, which is important.

Different Types of Employment and Relationships Relevant to Agency Law

Employment is a commitment made between two individuals or parties based on a contract. The worker is one party while the employer is the other one. The two exist simultaneously based on a reciprocal partnership. There are different forms of employment, which among them include, full-time employment. In this case, workers in a company or organization are compelled to work daily, and often expected to work throughout a whole week, excluding weekends and holidays.

The second type is the part-time employment, where workers are expected to work irregularly. As their payment method, they are entitled to work on a pro-rata basis. These workers are credited to such types of arrangement as personal, career, sick and annual leaves. They also qualify for public holidays payments (for those holidays which occur during working days). The third and last arrangement are the extended service and bereavement leaves.

The other form of employment is the contract or fixed term. It is a condition in which workers are hired for a certain amount of time which is defined before the end of a project. Other circumstances may include a worker taking a sick or parental leave permission. The employer is expected to send a written agreement to the workers and point out the period of the employment contract. The same categories of leaves like; sick, parenting, and annual leaves, are provided to both full-time and fixed-term staff.

Casual employment is a type of employment whereby workers are hired on an occasional basis. The employer and the workers will need to compromise on the following. First, the periods or alternatively, the days which the individual wants to work. Second, employees are not subjected to any expectations of a continuation of employment. Third, they are free to reject any job opportunities. Fourth, they are not eligible to yearly or personal sick leave but they are entitled to long-term leave for service and unpaid leave for bereavement.

Apprenticeships and traineeships: these forms of work are primarily offered to mainly those individuals who are training to become business people. In the arrangement, trainees are engaged in the learning of skills and non-trade occupations. Both situations have the following characteristics: practical applied jobs, salary rates that are guaranteed by a settlement or award, gaining various skills on or off the table, and accreditation of a training arrangement. Notably, apprenticeships and traineeships incorporate training with a real job, an actual supervisor and a substantial salary. Apprentices and trainees strive towards the attainment of a widely renowned certificate whilst gaining useful skills at work and under the supervision of a training company.

Advantages and Disadvantages of Each Employment Type and Relationship Type Specific to Acme Fireworks

According to the Acme Fireworks company, the owner claims that if the corporation revokes the deal by some chance, the company will then be forced to lay-off some of the workers, as he cannot support their payments. It indicates that he may be compelled to retain them on a contract so as to enable the company maintain the cost of operations. Full-time employment is yet another business relationship which can be used by Acme Fireworks. In the arrangement, the original employees could be required to stay even if the other company cuts its fireworks deal with Acme company.

There are numerous advantages which are attributed to the contract form employment, where money-saving is one of them. The procedure of recruiting new workers’ demands a lot of money because of training and incentives related to hiring full-time employees. It also serves as a way to save money in the form of personal income taxes. Second, another benefit is associated with seasonal or specialized assistance. Contractors recruited are already skilled in their field of expertise. Incidentally, independent or freelance contractors could perform the role of supervisors who could start and run the project as well.

The company’s stakeholder’s or the owner’s satisfaction is another advantage. If the employer discovers that the contractor is not delivering to his or her satisfaction, the hiring manager is obligated to terminate the relationship immediately with little or no paperwork. There are, however, multiple drawbacks which are related to the contractor basis of employment. The leading one is the possibility for a governmental audit to leak critical and confidential business information, as well as malware infections and intrusions which are not allowed. Another disadvantage is the limiting factor in the recruiting process of employees.

Why Acme Fireworks Should not Operate as a Sole Proprietorship and Recommendation of a New Business Entity

As previously mentioned, a sole proprietorship does not have any legal differentiation between the proprietor and the company, meaning that all assets invested in the company are financially at risk. In the event of loss of debt or litigation, even though it allows for the sale of personal properties, the owner may have to accept greater responsibility in trying to sustain the company.

There is a limited capacity for sole proprietorship companies to collect funds. To raise capital, these entities are not in a position to put their shares and interests on sale, and they most frequently lack the opportunity to obtain large loans such as other types of companies. It is also worth noting that sole-owners are responsible for all corporate management duties in all essential functions in their companies, including accounting, customer support, promotions, service delivery, and others. They may have expertise and skills in one role, such as accounting, but they may be very inexperienced in others, slowing down the company’s development.

The growth and prosperity of the only form of business ownership heavily depend on the proprietor, which means that the existence of the business is threatened in the event of death, insanity, bankruptcy, or illness. Even if the company is passed to the next of kin or leased to another individual, its existence is still endangered. It is so because the new tenant does not have the experience to manage the company, and it will take time for consumers to express the same loyalty to the brand as they did before.

My recommendations to Acme Fireworks would be for the owner to search for more individuals to partner with, and turn the whole firm into a partnership corporation. It will now turn Acme Company into a business where two or more entities have joined to run and administer the company. Profit and expenses will be divided as per the ratio of invested capital. As a partner in the new business, Acme Fireworks will gain from the purposes mentioned below in terms of development and sustainability.

First, there is cooperation in partnership enterprises, enabling each partner to offer their skills in the form of human resources. Obligations are well distributed, and one feels it easier to manage their responsibilities. The workload is significantly reduced, and partners may have more time in their lives for many other tasks, thereby minimizing pressure, as is the scenario for sole ownership. Secondly, it is much easier to raise capital or to source some funding through partnership as compared to sole-proprietorship. It is because, in partnership, all the stakeholders will contribute towards the initiative. Another advantage is that leveraging capacity from financial firms is high. Thus, a significant amount of money would ultimately be realized to start the business.

For Acme Fireworks, the case would be different from before where the businessman had to source for funds solely (Lee, 2020). The more stakeholders there are in the business, the greater the start-up investments, which in return will increase both the growth potential and also the income earned by the company. It is also important to realize that in sole-ownership entities such as Acme fireworks, there exists constant fear of liabilities and losses (Bukhanevych, 2019). While in partnership, company losses and liabilities are shared among the partners, making it easier for entities to flourish even in challenging economic conditions such as recessions.

Third, in this type of business, decision-making is more straightforward because individuals have varying ideas and skills and, if there is indeed a problem, they all join and address it together. Partners share moral encouragement, thereby providing a safer place for creative thinking. There is a collection of brains with various abilities and, ultimately, a crucial resource to the growth and success of the company (Lee, 2020). Finally, because there is little legislation relative to companies when it comes to formation rules, partnerships are easy to create, run, and maintain. There is also more freedom in terms of management as long as the participants agree.


Without legally binding contracts, businesses would not work as they are doing currently. Contracts allow individuals to find jobs, start companies and attend school, as they wish, take part in sports, and much more. Social contact is mainly based on a set of agreements between people. Consequently, effective partnerships enable companies to draw on the strengths of one other and rapidly and efficiently build business collectively.

A competitive advantage is the opportunity to utilize partner capital, subject matter knowledge, and creativity. Customer option and continuity are provided through the maintenance of deep relationships. From the case scenario, since Acme Fireworks company seems to be experiencing some financial and management difficulties, the best business approach they ought to take is forming a partnership. With the right partners on board, all the challenges will be effectively dealt with.


Bukhanevych, O. (2019). Terms of Origin of Liabilities on Compensation for Moral Damage. University Scientific Notes, 70-80. Web.

Lee, J. (2020). Estimating the benefits and costs of forming business partnerships. The Rand Journal of Economics, 51(2), 531-562. Web.

Meagher, J. (2018). (Re-defining) the trust of the specifically enforceable contract of sale—the vendor purchaser constructive trust. Trusts & Trustees, 24(3), 266–297. Web.

Niziołkiewicz, M. (2019). Transforming a sole proprietorship into a limited liability company – selected tax aspects. Roczniki Administracji I Prawa, 2(XIX), 309-321. Web.

Starr, K. (2017). Are noncompete agreements generally enforceable in nursing?. Nursing, 47(4), 14-15. Web.

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