Where Law Meets Business
‘Stop, porridge pot, stop’. At least the little girl had the magic words to stop the porridge pot from producing and overflowing porridge. This is a reference, of course, to the fairytale story, The Magic Porridge Pot.
In reality, we have overflows of another kind and things have gone terribly wrong and we don’t have the magic words to make it stop.
To begin, it was a Harvard Law School professor who articulated a set of principles about the morality of law including:
• that laws must be publicly known and accessible so individuals and businesses can understand and comply with them—the principle of promulgation;
• that every letter of the law should be simple and clearly stated. It should be written in a way that it is easily understood. It should not require high level skill or higher education for a law to be understood—the principle of clarity;
• that the law should not be fleeting but relatively steady through time so that individuals and businesses can adjust their behaviour accordingly—the principle of stability.
If we embrace these three principles as benchmarks, we have lost our ways.
The principle of promulgation: that laws (which includes regulations, rules, rulings and determinations) must be publicly known and accessible.
Yet in practice, they’re anything but that. Laws are not announced on television or sent with your electricity bill. They are scattered across obscure government websites, nested within complex legislation, and buried deep in court databases—hardly in plain sight.
We come to the principle of clarity: that the law should be simple and clearly stated. This hardly needs to be said that this is no longer the case. As the then Justice Steven Rares of the Federal Court said, in reference to the Income Tax Assessment Act, the Competition and Consumer Act and the Corporations Act the ‘business community of this country cannot be expected to deal with legislation of this unnecessary detail. The cost of trying to understand the discordant patchwork of wish list amendments that have been welded onto a simple body of an original Act must be truly mind boggling. Do we really need a telephone book-size statute to regulate corporations?’
So much for the principle of clarity.
Finally, we come to the principle of stability: that the law should not be fleeting but relatively steady. Legislation is churned out so frequently and in such piecemeal fashion that even lawyers might struggle to stay current. Pity the entrepreneur.
Yet too often, these principles—benchmarks—are cast aside in favour of quick fixes—laws shaped less by thoughtful design and more by panic, politics or the desperate need to be seen to do something—anything—no matter the cost.
But these principles are not academic because when these principles are cast aside or ignored, which is happening too often, two things happen and have happened and will continue to happen. First, Justice Rares’ phrase, ‘legislative porridge’, captures one result: a mix of legislative measures stirred together in haste. Laws shaped more by panic, politics or the desperate need to be seen to do something—anything—no matter the cost. But this lacks the structure and substance that you and your business needs. Spurred by successive crises and regulatory failures (for example, the Optus outage, PwC tax leaks, consumer difficulty in accessing consumer guarantee remedies, Robodebt Scheme, underpayment of wages, poor airline performance, enforcement of restraint of trade clauses, children being harmed online), the legislative engine has been working at a relentless pace.
Second, the outcome may best be described as what the author calls ‘corporate pudding’—a term that captures three recurring characteristics of corporate non-compliance that should be apparent to both businesses and informed observers: (1) the nature of the noncompliance and failures demonstrate a striking disregard for fundamental principles or requirements of the law; (2) businesses repeating its own previous noncompliance, indicating a failure to learn from past mistakes; and (3) businesses committing the same or similar breaches that were committed by their competitors, indicating a disengagement from, or disregard of, the legal and regulatory developments around them.
But here is the more intriguing point: corporate noncompliance often triggers the very reactive lawmaking that creates the legislative porridge in the first place. It raises a worthy question: does ‘legislative porridge’ cause ‘corporate pudding’, or does ‘corporate pudding’ cause ‘legislative porridge’ or are they, in fact, mutually reinforcing—each a cause and a consequence of the other?
If this all sounds like a legal porridge bowl tipped sideways, that is because it often is. To help make sense of it, the author of this article is the author of a new book called Bridging Business and the Law in Australia. It was published by LexisNexis on 5 June 2025. And that is precisely the point of the book: to serve as a navigational guide through the thickets of modern Australian business law.
It spans 40 chapters organised into nine parts. The chapters appear in the order that events are destined to arise for a business. The book not only presents the law in an accessible way, it goes further—offering practical tips, red flags to watch for, highlighting common traps and how to avoid them, presenting lesser-known free tools that can make a real difference to businesses and including real-world scenarios. This book fills a gap in Australian legal and business literature not previously addressed.
With about 2.5 million businesses in Australia, many without lawyers or easy access to professional legal advice, the legal system’s growing complexity can be daunting. This book provides a margin of safety for them.
—Nilay B. Patel is a lawyer based in Melbourne.
