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CSEET · Business Laws and Management · Introduction to Law

A trading community in a town has, for over a hundred years, followed a uniform, reasonable and certain practice in settling payments. Ravi disputes it, saying it is not in any Act. No statute contradicts the practice. How is the practice most likely to be treated by a court?

A court can recognise the practice as binding custom because it is long-standing, certain, reasonable and not contrary to any statute. Custom need not appear in an Act, and no written signatures or executive approval are needed.

  1. AIt can be recognised as binding custom, since it is ancient, certain, reasonable and not contrary to statuteCorrect
  2. BIt is void because only written Acts of Parliament are law
  3. CIt is binding only if every member of the community signs a written agreement
  4. DIt is binding only if the Prime Minister approves it

Explanation

Courts recognise custom as a source of law when it is ancient, certain, reasonable, continuous and not opposed to statute. Absence from an Act does not defeat it. Requiring signatures or executive approval is not a condition for custom to bind.

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