Costs and Benefits of Walmart’s takeover of Asda - 2475 Words

Costs and Benefits of Walmart's takeover of Asda (Term Paper Sample) Content: OBE64021 Costs and Benefits of Walmart's takeover of Asda Introduction Walmart is an international grocery store chain with origins in the US. The Walton brothers opened the first Walmart store in 1962 in Rogers, Arkansas (Atif, 2014). Having saturated the US market with Walmart stores, the corporate giant was ready for international expansion. This is for seeking new markets for its products and exploiting other opportunities that come with presence in another country (Sloman and Sutcliffe, 2000). This happened in the early 1990s, in Canada, South America, China, Germany, and the UK (Hegazy, 2012). In the latter, the grocery store giant expanded through acquiring another chain similar to itself: ASDA. The geographical and cultural proximity of the UK made this expansion a low-risk one for the company. This is because it had a ready market and it would ensure elimination of a formidable competitor through acquisition (Zhen, 2007). This is effective in reducing the number of competitors that the company would have to contend with once it established itse lf in the host country. This made the chain attractive to Walmart, which made a ÂÂ £6.7 million successful bid to acquire it (Whysall, 2001). This was the giant's entry point into the UK market. The entry of a highly successful and large corporation into a new market is likely to have effects on the company itself and the host country. This paper seeks to discuss critically the costs and benefits of Walmart's takeover of ASDA, for the UK and Walmart itself. Costs and Benefits to Walmart Benefits One of the primary advantages that the company gained is the ability to achieve growth. Establishing itself in the UK through ASDA has enabled the company to gain profits from tapping into a market that values low prices and quality services. According to Hegazy (2012), Asda got credit for 42.7% of Wal-Mart sales in international markets in 2006. This indicates that the corporate giant is benefitting from its subsidiary, hence has been able to achieve growth. Another benefit for Wal-Mart is the ability to learn from ASDA regarding managerial, marketing, and packaging ideas. This took place in form of exchange programmes where ASDA employees and managers exchanged with their Wal-Mart colleagues to learn from each other (Wal-Mart, 2000). Some of the things that Wal-Mart borrowed include the hands-on training of new retail managers and holding ten-minute conferences to set priorities at the beginning of each working day (Reilly and Williams, 2011). Such borrowing exercises are beneficial for the corporation and its subsidiary as they foster improvement. Another benefit that Wal-Mart is enjoying due to its acquisition of ASDA is the control it has in its host country. This concerns pricing. Wal-Mart has led to the lowering of prices in supermarkets due to its price-cutting efforts. This has kept customers and competitors on their toes due to the price war that it instituted when it entered the UK market. This gives Wal-Mart a firm foothold as a corporation that has the ability to shake up the supermarket industry in the UK. Another benefit that the firm is enjoying is the ability to spread risks in more countries. Having failed in Korea and Germany, the company needed to expand in a country in which it would be able to succeed and hence gain profit. ASDA was an already existing producer; hence, it provided a much easier opportunity for expansion than starting from scratch in the UK. This is because the probable cost of land and taxes accompanying establishing a subsidiary from scratch would cripple the enterprise even before it began. Costs One of the costs that Wal-Mart has to grapple with is competition. Its main competitor in the UK is Tesco, which has been experiencing higher domestic and international annual growth rate than Wal-Mart (Atif, 2014). This means that it is gaining ground in the country and abroad through expanding faster and getting more attention than its counterpart. Tesco also seeks to establish itself as a low-cost seller to reduce the price differences between it and its competitor (Atif, 2014). For Walmart to gain and maintain a competitive edge there needs to be a gap between its pricing and that of its contenders. When the gap no longer exists, then it becomes difficult for it to attract customers as it invests heavily in price-cutting. According to the neoclassical model, where the price is as low as possible and the demand is less than the supply, then the company would have no option but to further reduce its prices (Brown, 2000). However, for Wal-Mart, this would not be an option since it h as already reduced the price of its products to the lowest point at which it would still be able to gain profits. Otherwise, it would only be recording losses. Another cost is high employee turnover. When Wal-Mart took over ASDA, managers and subsequently some of their team members left the company. For instance, three members of the subsidiary's eight-member board have left, as did the pioneer of its George clothing range followed by three of his underlings (Piercy, 2009). These demoralizing occurrences do not aid in helping Wal-Mart come back from its reputation of employee mistreatment. Labour is a major factor of production (Costello, 2000) and the cost of training and recruiting workers is high (Hosbawm, 2000). Therefore, this is a major cost for the company. Costs and Benefits for the UK Benefits Wal-Mart brought price-cutting to the UK. This means that consumers could buy products at much lower prices. ASDA sells its products at prices that were 9% less than that of its competitors (Piercy, 2009). This enables low-income households to have the ability to afford the products that they could not afford before. This is a way of improving the living standards of the populace since they move from the point of desiring products to buying them. This is a perk that authorities would approve of and encourage as it improves the lives of citizens. Another advantage for the host country is technological transfer. Sloman and Sutcliffe (2000) elucidate that multinational corporations impart technological knowledge through training of employees and local producers imitating the new entrant's technology. This is a significant contribution to the host country as it plunges forward in technical expertise through the development and use of machinery and other equipment. The technology in question is the inventory control system, which exists in-house but also connects the supermarkets to the US, as are all Wal-Mart stores in the world (Hegazy, 2012). The satellite system has video conferencing facilities and stock control systems where the head office keeps an eye on the inventory, sales, and customer numbers (Hegazy, 2012). This sophisticated system allows the locals to learn from it and perhaps develop it for use in other fields. Costs Multinational organizations tend to displace local producers and companies when they permeate a new market. This happens because the domestic enterprises lack the necessary resources such as technology to compete with the international corporations (Sloman and Sutcliffe, 2000). According to Rowell (2011), Wal-Mart uses predatory pricing to drive its competitors (both big and small) out of business. This has led to loss of employment since organizations close, and, farmers and some of their workers commit suicide (Rowell, 2011). This undesirable outcome puts the host country at a great loss. Wal-Mart operates on having the lowest prices possible. This indicates that its production factors including labour have to cost them as little as possible as well for the company to be profitable. This results in poor wages for the employees that work for them. Poor employee benefits and the inability to unionize also follow where poor wages exist (Rowell, 2011). This formula seems fitting for high employee turnover, a loss, which the company appears to have no problem carrying. The company also faces backlash for exposing their local and international employees to bad working conditions (Rowell, 2011). It is likely that the host country would have to bear this cost as well. Conclusion Wal-Mart took over ASDA, a grocery chain store that is similar to it, and used it to enter the UK market without having to establish themselves from scratch. This takeover has had effects on Wal-Mart itself and the country host. For Wal-Mart, the perquisites include achieving growth through entering a new market, learning opportunities through interaction with ASDA organizational culture, control over the host country, and spreading business risks through operating in more countries. For Walmart, the costs include having to grapple with tough competition locally and internationally, and high employee turnover. On the other hand, the host country enjoys advantages such as low prices for products including food and housing appliances. It also gains technological knowledge from Wal-Mart's sophisticated use of ICT in its stores. The costs that the UK has to grapple with include the displacement of local producers and businesspersons. It also has to suffer poor wages, low employee benefit s, and poor working conditions for the part of the population that Wal-Mart hires. From this critical analysis, it is clear that Wal-Mart benefits more from this take over than the host country and its populace does. Reflection on the Writing Process The essay in Part 1 is a critical analysis of Wal-Mart's takeover of ASDA, a UK-based grocery store chain. The analysis focuses on the costs and benefits that resulted from the acquisition. This is for both Wal-Mart and the host country. The writing procedure begins with a critical analysis of the reading materials. This includes the recommended chapters in (Suneja, 2000). Starting with this text helped lay the...

Ancient Roman And The Roman Empire - 1236 Words

The Ancient Roman’s had a wicked idea of entertainment. The Colosseum or Coliseum, also known as the Flavian Amphitheatre, is an elliptical amphitheater in the center of the city of Rome, Italy. Built of concrete and stone, it is the largest amphitheater ever built and is considered one of the greatest works of architecture and engineering. The Roman Colosseum, constructed in 79 AD, is a visual representation of the importance of physical strength and military proficiency in Ancient Roman civilization, this is because it was constructed to revel Rome’s military accomplishments and to provide entertainment for Roman citizens. Many events prompted the construction of the Roman Colosseum. Many historical events led to the construction of†¦show more content†¦Vespasian sat on the Roman throne from AD70-79. (Sims et al., 1999) proposes that ‘Vespasian was the emperor who restored order after Nero.’ Many emperors of Ancient Rome satisfied the needs of their citizens with the giving of bread and entertainment, Vespasian wanted to impress visitors and the general public. Being able to build a vast structure showed that the government took care of its people and was wealthy. It essentially also showed the emperor’s power. Emperor Vespasian used the construction of the Colosseum to gain popularity and support throughout his empire. His name was not to be forgotten, as well as Titus who was the successor and heir of Vespasian. Jewish slaves assisted in the construction of the Colosseum in a form of slave labour. Jewish slaves were the forced builders of the Colosseum and it was accomplished with slave labor. Due to failure in the Great Revolt, 20,000 Jewish slaves were brought over to Rome to build the Colosseum. (Mathias, 2011) proposed that another 70,000 Jewish slaves were used to quarry stones for the Colosseum, haling over 292,000 cartloads of stone from the Tivoli which was 17 miles away from the construction site. The construction project was funded by the treasure stolen from the Temple, as the empire was broke at the time due to the Great Revolt. The construction project took 8 long years to build. Unfortunately, Vespasian was unable to

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The Case Of Marbury V. Madison - 854 Words

For over two centuries, the most important law document in America is the Constitution. More importantly, among the three branches, the judicial branch has one of the most important jobs in the government: to check and review the laws established by the executive branch and legislative branch. Moreover, the judicial branch’s job is to interpret and apply the law in the government, but it is also the only branch with the power of Judicial Review, which the judicial branch decide whether a law or action is consistent with fundamental laws such as the Constitution. This paper will be exploring the history behind the paramount case of Marbury v. Madison, 1803 and its decision that established the power of Judicial Review, the importance and relevancy of Judicial Review in modern government through the case of Ladue v. Gilleo, 1994, and lastly the criticisms of the powers and duties behind Judicial Review. The intentions behind the judicial review sprouted from the disagreements be tween John Adam’s party, later associated as the Federalist Party, and Thomas Jefferson’s party, the Democratic-Republican. Upon losing his re-election race, John Adams directed commissions to fill the federal office with Federalists, in the hopes to hinder Thomas Jefferson’s presidency. These commissions were sent up until Adam’s last day in office. Many of these appointees were argued to have questionable legitimacy, as many appointments were delivered at the stroke of midnight—these were theShow MoreRelatedThe Case Of Marbury V. Madison1635 Words   |  7 PagesThe Constitution was founded in order to limit the power of the government and protect the rights American citizens. This proved true in the case of Marbury v. Madison (1803), when the Supreme Court of the United States established its power of judicial review when it declared that Section 13 of the Judiciary Act of 1789 was unconstitutional according to Article III of the Constitution. Considering this, the Supreme Court’s decision to uphold an interpretation of the Constitution that aligns withRead MoreThe Case Of Marbury V. Madison1601 Words   |  7 PagesIn the year 1803 the case of Marbury v. Madison was brought before the Supreme Court in order to address the issue of William Marbury’s appointment as federal circuit judge. This created a unique and complex challenge for the Supreme Court of the time because they were operating under no legal precedent, which meant that they had no prior cases to reference to reach a ruling. The issue came to a head after the Judiciary Act of 1801 allowed for President John Adams to appoint sixteen new circuit judgesRead MoreThe Case Marbury V. Madison1442 Words   |  6 PagesOne of the major results of the case Marbury v. Madison was this term called judicial review. Judicial review, today, is a task that the Judiciary Branch of the government performs on legislative acts that are passed to determine whether or not the acts are considered Constitutional. One of the biggest changes made not too long ago by the Judges in the Judiciary Branch, using judicial review, was the ruling that restricting same-sex marriage is considered unConstitutional and they made same-sex marriageRead MoreThe Case Of Marbury V. Madison Essay2171 Words   |  9 Pagessay what the constitution is, Congress has the power to grant or remove jurisdiction from any appellate case that is not considered original jurisdiction. The power the Supreme Court has today stems from the case of Marbury v. Madison: a hearing commonly known for the establishment of judicial review(PBS). Through this case the court under Chief Justice Marshall came to three conclusions: Marbury has the right to be commissioned as a Justice of the Peace, the court should be able to provide a writRead MoreMarbury V. Madison Case3462 Words   |  14 PagesMarbury v. Madison Marbury v. Madison was the case that was considered a landmark concerning judicial review in regards to the jurisdiction of the Supreme Court. What had taken place was that the President at the time had appointed a group of men to the positions for justices of the peace and for the District of Columbia, circuit judges, which included in the group, William Marbury. Later they were subsequently approved by the senate. After approval, President Adams signed the commissionsRead MoreThe Case Of Marbury V. Madison Essay2180 Words   |  9 Pagesor remove jurisdiction from any appellate matter that is not considered original jurisdiction. The power the Supreme Court has today stems from the case of Marbury v. Madison: a hearing commonly known for the establishment of judicial review (McBride). Through this case, the court under Chief Justice Marshall came to three conclusions: Marbury has the right to be commissioned as a Justice of the Peace, the court is able to provide a writ of mandamus under the Judiciary act of 1789, and the factRead MoreThe Case Of Marbury V. Madison940 Words   |  4 PagesJurisdiction over any cases involving this offense†¦Ã¢â‚¬  as to punishing individuals to three years in prison for the use, transport and/or to consume butter beer. To this, we refer to our Constitution that establishes matters that have original jurisdiction, Art. III S. 2 â€Å"The Judicial Power shall extend to all cases, in Law and Equity, arising under this Constitution, the Laws of the United States, and Treaties made, or which shall be made, under their authority†¦ In all other Cases before mentioned , theRead MoreThe Case Marbury V. Madison857 Words   |  4 PagesIn the early years of the Republic, states came often in front of the Supreme Court to resolve disputes of issue of the supremacy of the National Government. In 1803 the case Marbury v. Madison held that Congress cannot pass laws that are contrary to the Constitution, and it is the role of the Judicial System to interpret what the Constitution permits. The discrepancies between the Federal Government and the States occurred often, as the States were not happy to give up their power to the FederalRead MoreThe Case Of Marbury V. Madison1753 Words   |  8 Pagesthe â€Å"power to interpret the law, determine the constitutionality of the law, and apply it to individual cases (The White House)†. However, since the ratification of the constitution, much like the other two branches of government, the judicial branch has also experienced an expanded delegation of authority and power. This notion is evidenced in the 1803 decision on the case of Marbury v. Madison where the Supreme Court asserted its power of judicial review by †blocking last-minute appointments byRead MoreEssay on The Case of Marbury v. Madison973 Words   |  4 Pages The case of Marbury v. Madison centers on a case brought before the Supreme Court by William Marbury. Shortly after Thomas Jefferson defeated John Adams in the election of 1800, Congress increased the number of circuit courts. Adams sought to fill these new vacancies with people who had Federalist backgrounds. To accomplish this, he used the powers granted under the Organic Act to issue appointments to 42 justices of the peace and 16 circuit court justices for the District of Columbia. Adams

The Scarlet Letter By Nathaniel Hawthorne - 1522 Words

In many cases, humans are instinctually very judgmental and quick to label individuals. It is so easy to look upon a person who we are not acquainted with and create false judgments based on what we see. The judgment of individuals who we are not acquainted with is chiefly based on their public appearance and how they seem to carry themselves. The fictitious book The Scarlet Letter, written by Nathaniel Hawthorne, takes place in the Puritan town of Boston. The Puritans were a group of English Reformed Protestants who sought to â€Å"purify† the Church of England from all Roman Catholic practices. Puritans were unhappy with the limited extent of the English Reformation and with the Church of England’s tolerance of practices. One can assume that†¦show more content†¦Some may even speculate what the homeless person might have done to end up in their current position. Thus making inaccurate assumptions about that person and having judged them erroneously. The Purit ans lived the same judgmental way. â€Å"[The Puritans] believed that God expected them to live according to the Scriptures, to reform the Anglican Church, and to set a good example that would cause those who had remained in England to change their sinful ways.† They also â€Å"were self-governing bodies, answerable to no higher authority†. One can conclude that the Puritans’ belief in the truth that God had expected them to live according to the Scriptures led to their adoption of a much stricter way of living. Hester Prynne, the protagonist who had committed adultery, is condemned to wear the scarlet â€Å"A† to speak for her sinful actions. â€Å"[The Puritans] believed that the civil government should strictly enforce public morality by prohibiting vices like drunkenness, gambling, ostentatious dress, swearing, and Sabbath-breaking.† Punishing Hester publically at the pillory not only humiliates her but it also stains her public perception. Hav ing the scarlet â€Å"A† imbedded into her bosom brands her as an impure woman who broke the covenant she had made with her original husband. Judging a person through a scarlet â€Å"A† is not only erroneous but also hypocritical. It is erroneous because it does not make any

The Canadian Government and Industrial Schools Essays

In the late 1800s, the Canadian government and the church bodies started removing aboriginal children from their homes and started replacing them in industrial schools. The residential schools were the most effective take for destroying aboriginal culture and identity. Many of the Aboriginal children came away from school in their teen year’s barely knowing how to read and write. Thus, what was more critical was that many children were abused emotionally and physically throughout their school years. More importantly, the schools were located far away because the federal government wanted to minimize the amount of parent-child contact. The severity of the abuse suffered in residential schools intended to kill the Indian children within,†¦show more content†¦Furthermore, Aboriginal children learning a different language at school and not being allowed to speak in native resulted in a loss in their culture. In residential schools, many of the children were physically tortured badly by older youth and staff in various ways. In fact, the aboriginal children were forced to live, learn, and work in terrible conditions. The federal government constructed schools for the economy rather than safety towards the children; moreover, the school structures were made out of the cheapest and simplest material. The goals of the residential school were to train students for manual labour rather than academic achievements, as the education standards were significantly lower. For instance, the statistics in 2001, only 8% of the 25-34 age groups of aboriginal people had completed a university degree, while 28 % of all Canadian did. On the other hand, children were harshly disciplined for many reasons including bed-wetting, communicating with opposite sex, stealing food, running away, talking back to staff, and being out of school bounds. Some of the examples of punishment were deprivation of food and stra pping. â€Å"In 1921, a visiting nurse at Crowstand school discovered nine children chained to the benches in the dining room, one of them marked badly by a strap†(course package). Regarding this, it shows how the children were brutally beaten. Alternatively, not only the children inShow MoreRelatedWere the 20s in Canada Really Roaring?1664 Words   |  7 Pageseconomic, social and political changes really made the 1920s in Canada â€Å"roar†. First of all, Canada was very roaring economically in the 20s because of strong economic growth and prosperity. With the introduction of the assembly line by Henry Ford, Canadian industries flourished. Manufacturing processes were a lot faster, because of the improved work flow and better distribution of labour. These drastically changes sharply improved the productivity in the manufacturing sector, thus companies were ableRead MoreThe Arctic Archipelago And The Highest Apical Peak Of Nunavut1255 Words   |  6 Pagesmany things common in them as the population is very low because the temperature is very low in summer and in winter. Apart from temperature, the people from the southern part of the country are employed or are hired in many fields such as government jobs, public services and some other. Aside from atmospheric conditions, the political system of these territories is also same; moreover these territories enjoy fewer rights than the provinces of Canada. 3. What are five historically importantRead MoreWhy It Should Be Mandatory For Every Canadian Essay1536 Words   |  7 Pagesinto industrial schools (later known as residential schools). These church-run schools were made to Westernize Indigenous children making them forget their culture, language, and previous way of life. Brutally punishing them if they disobeyed the rules. It is hard to believe these schools were being run from the early 19th century up to not long ago in 1996. Most people in Canada were never taught about the traumatic past the indigenous youth endured for so long. So why aren’t all Canadians educatedRead MoreAmerica s Residential School System991 Words   |  4 Pages The Canadian government saw the residential schools as the only a way to change native culture into civilized culture and this was by keeping their children away from native traditions. The purpose of the residential schools was to civilize the Indians and to make them good, useful and la wful members of society with strict punishments for any wrong doings. Richard Pratt, who was the founder of the Carlisle Indian Industrial School, one of the very first reservation schools, proclaimed â€Å"you mustRead MoreResidential schools1468 Words   |  6 PagesAbstract This research explores how the residential schools established in the 19th century affected the Native population and the Canadian government. This has been done by examining primary sources such as digital archives, books, statistics and reports. Upon examination of these events, it becomes clear that residential schools had a long term negative impact on the Aboriginal communities and created a negative image to the Canadian government. Despite the government’s goals of assimilating theRead MoreThe Current State Of Entrepreneurship1693 Words   |  7 Pagesoccupational abilities of the nation, and created conditions for a flourishing society. Thus, it is important to understand the Canadian entrepreneurial landscape, as it has transformed the country s economic state entirely. The purpose of this report is to investigate the current state of entrepreneurship in Canada in comparison to other G20 countries, and make recommendations for government and policy makers. It will p rovide a brief overview of the history of entrepreneurship, analyze the current state ofRead MoreAmerican Culture : The Pinnacle Of Human Achievement952 Words   |  4 Pages the confederation government of Sir John A. Macdonald came to view First Nations and Mà ©tis as serious impediments to nation-building. Even as treaties to make large tracts of land available for settlement were being negotiated with First Nations, a national policy was being developed â€Å"to do away with the tribal system and assimilate the Indian people in all respects with the other inhabitants of the Dominion, as speedily as they are fit for the change.† The Residential School System was to becomeRead MoreAboriginal Population With Federal Assistance Via Small Per Student Grants1435 Words   |  6 PagesPrior to the 1880s, religious organizations ran small mission schools for the Aboriginal population with federal assistance via small per-student grants. The federal government took a much larger role in residential schooling in the 1880s as a facet of a larger set of polices that operated to govern and control Aboriginal people, ban cultural practices, and achieve â€Å"their emancipation from tribal government, and for their final absorption into the general community† (as cited in The Truth and ReconciliationRead MoreDepression: Unemployment and Mackenzie King Essay1020 Words   |  5 PagesResearch Essay: To what extent was the Canadian government successful in its attempts to deal with the Depression? Carol Liang After World War I, the North American economy was booming, Canada had the world’s fastest growing economy. The start of the Depression came as a surprise to Canadians. When the stock market in the US, the biggest  exported  target  for Canada’s primary resources after war, crashed,  they  reduced their demand for the products, people in Canada’s primary  industries  went bankruptRead MoreNative Aboriginal : From The Three Groups : Inuit, Metis, And Indian1146 Words   |  5 Pagesï‚ § In 1992, the number of Aboriginal children enrolled in elementary and secondary schools was 96,600, which is only 2.5% of Aboriginal children population. o Unemployment: ï‚ § In 1960s, the unemployment rate for Aboriginal people was double that of national average, and in some areas the rate was five to six times higher. ï‚ § In 1990s, the unemployment rate for Aboriginal people (19.4%) was still double that of Canadian average (10%). ï‚ § A survey from 1995 showed that 77% of employers had difficulty in

Golden Rule of Interpretation free essay sample

The golden rule is that the words of a statute must prima facie be given their ordinary meaning. We will write a custom essay sample on Golden Rule of Interpretation or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page It is yet another rule of construction that when the words of the statute are clear, plain and unambiguous, then the courts are bound to give effect to that meaning, irrespective of the consequences. It is said that the words themselves best declare the intention of the law-giver. In law, the Golden rule, or British rule, is a form of statutory construction traditionally applied by English courts. The golden rule allows a judge to depart from a words normal meaning in order to avoid an absurd result. The term golden rule seems to have originated in an 1854 court ruling,[1] and implies a degree of enthusiasm for this particular rule of construction over alternative rules that has not been shared by all subsequent judges. For example, one judge made a point of including this note in a 1940 decision: The golden rule is that the words of a statute must prima facie be given their ordinary meaning. Although it points to a kind of middle ground between the plain meaning (or literal) rule and the mischief rule, the golden rule is not, in a strict sense, a compromise between them. Like the plain meaning rule, the golden rule gives the words of a statute their plain, ordinary meaning. However, when this may lead to an irrational result that is unlikely to be the legislatures intention, the golden rule dictates that a judge can depart from this meaning. In the case of homographs, where a word can have more than one meaning, the judge can choose the preferred meaning; if the word only has one meaning, but applying this would lead to a bad decision, the judge can apply a completely different meaning. The main advantages of the golden rule of interpretation are a) Errors in drafting can be corrected immediately . b) Decisions are generally more in line with Parliaments intention c) Closes loopholes d) Often gives a more just result e) Brings common sense to the law . Though the disadvantages of this rule cannotbe ignored Judges are able to add or change the meaning of statutes and thereby become law makers infringing the separation of powers and Judges have no power to intervene for pure injustice where there is no absurdity . The Golden Rule is really an elaboration, extension or moderation of the literal rule. It states that words should be used in their literal meaning only to the extent that it those not produce an absurd or intolerable conclusion, or result. The rule can be applied in two ways. Firstly by the narrow meaning whereby if there is ambiguity in the words of the legislation, preference will be given to the meaning of the word, which does not result in absurdity. In Adler v George , the defendant had been charged under s. 3 of the Official Secrets Act 1920, under which it is an offence to obstruct HM forces ‘in the vicinity of any prohibited place’. The defendant carried out the obstruction inside the area. The defendant was found guilty of the charge the court did not limit itself to the literal wording of the Act. The second use is the wider or broad approach. It is used to avoid an outcome, which is absurd or obnoxious to principles of public policy even if the word(s) only have one meaning. In the case of Re Sigsworth . This was a case of murder and inheritance. Under s. 46 of the Administration of Estates Act 1925, a person, could not inherit the estate of the decease if they had murdered that other person, otherwise the murderer would benefit from his/her crime. ? The Golden rule was first set out in the case of Grey v Pearson , an old British case. The gist of this rule is that if the words are given their ordinary meaning, and it is clear that this meaning does not correspond with the clear intention of the legislature (as one can find in the whole of the statute or other relevant issues), then one can depart from the ordinary meaning of the statute so that one can give effect to the intention of the legislature. As you will see, this rule has its own peculiarities. Lord Wensley Dale’s statement in Grey v Pearson is important: We are to take the whole statute together and construe it altogether, giving the words their ordinary signification, unless when so applied they produce an inconsistency, so as to justify the court in placing on them some other signification, which, though less proper, is one which the court thinks the words will bear.