Legal Updates

The Government have published their consultation document on the proposed review of the licensing Act as highlighted in the previous article by Peter Adkins. With the trade given only 6 weeks to respond, the Government certainly seem hell bent on making changes, Peter looks into what changes they are proposing and the impact these could have.

It may not have escaped your attention that we have recently had an election! You will also have noticed that the new government has set out its proposals for the next 18 months in the Queens Speech this week.

One of the 22 bills revealed in the Queens Speech was one entitled the ‘Police Reform and Social Responsibility Bill’ and this has the stated intention of making ’the police service more accountable to local people and to tackle alcohol related violence and disorder’.

We all have choices in life. We choose whether to marry or live with another person. We choose where to live even if there are constraints placed upon us as to what we can afford. We choose to make compromises in our relationships, in our décor style and as to what our money is spent upon. We choose our children’s names and all our lives have an impact upon those children who like a sponge absorb all that they see, hear and are encouraged to do. There are however times in our lives when some choices are taken from us, such as death, illness, redundancy and divorce.

Professional advisers have, quite rightly, in the past suggested that if you live in a leasehold property it makes sense to consider applying to lengthen the term of your lease. With property prices having recently fallen the cost of doing this has also reduced so there is every reason to consider such action as a "good investment" for the future.

If you live in a house or maisonette it may be possible to purchase the freehold but as Derek Cook from Sydney Mitchell Solicitors explains, there are potential problems as regards lease extensions.

Sydney Mitchell has been appointed by the administrators of First Quench Retailing Limited to deal with the disposal of properties nationwide.

First Quench, which operated a number of well-known off-licence brands, including Threshers and Wine Rack, went into administration in October 2009. Richard Fleming, Mick McLoughlin and Ian Corfield of KPMG, the appointed administrators, subsequently instructed Sydney Mitchell as one of only two firms to deal with the sale of the First Quench portfolio.

In an environment of rising taxes, knowing what you can do to protect your assets for your family’s future is essential. One way of doing this is to set up a trust, but what is a trust?

A trust arises where assets are transferred by one party ("the settlor") to other individuals ("the trustees") to hold for the benefit of others ("the beneficiaries"). The trustees owe a duty of care to the beneficiaries when managing the trust assets.

In an environment of rising taxes, knowing what you can do to protect your assets for your family’s future is essential. One way of doing this is to set up a trust, but what is a trust?

A trust arises where assets are transferred by one party (“the settlor”) to other individuals (“the trustees”) to hold for the benefit of others (“the beneficiaries”). The trustees owe a duty of care to the beneficiaries when managing the trust assets.

The Court of Appeal's decision in Oakland v Wellswood (Yorkshire) Ltd has finally been released after much anticipation from insolvency practitioners and businesses alike. The Court has held that Mr Oakland's continuity of employment is preserved by virtue of Section 218 of the Employment Rights Act 1996. Therefore any employee of a company in administration employed by the buyer after a pre-pack sale will be able to rely on this same provision to maintain continuity of service.

 

A recent, bitterly contested ‘big money’ divorce case shows how reluctant the courts are to upset financial settlements on the basis of contingencies and reinforces the point that bad behaviour is not a basis for changing the division of the assets.

It involved, as do so many high profile cases, a man who was successful in the City and his wife. The couple had lived together for five years before they married in 2003, but the marriage broke down in 2005. The couple had one child.

In a recent case a company director, Paul Edward Raine, was prosecuted for committing what the courts deemed a serious and deliberate breach of section 216 of the Insolvency Act 1986. This states that it is an offence for someone to become a director of another company under or known by a prohibited name within a period of five years if they were a director of the insolvent company at any time during the year before it went into liquidation.

Despite talk of 'green shoots' of economic recovery and an improving market, the Insolvency team at Sydney Mitchell are expecting a rise in Insolvency cases heading their way.

Already insolvency statistics show that there is a 39.1% increase from last year in company insolvency's. This includes administrations, compulsory liquidations and creditors voluntary liquidations. Individual insolvency's are also on the increase with a rise of 27.4% from last year. This figure includes bankruptcies, IVAs (Individual Voluntary Arrangements) and DROs (Debt Relief Orders).

This month Dippalli Naik from Sydney Mitchell looks at the recent changes to Employment Law Legislation and how it could affect your business.

Changes are set for 1st October when employers are no longer able to pay tips and service charges through the payroll in order to meet the minimum wage. This change will be set to benefit those working in the restaurant trade where tipping is commonplace. But will inevitably put pressure on the employers who have historically been paying the tips through the payroll in order to make up the pay to meet minimum pay requirements.

A Court of Appeal decision over a divorced couple's pre-nuptial agreement could pave the way for such agreements to become legally binding in England and Wales.

In a case heard before the Court of Appeal in April 2009 involving Katrin Radmacher, a German heiress, the Court of Appeal has overturned an earlier court decision to award her ex-husband £5.8m of her £100m fortune despite their pre nuptial agreement.

When did your company last have a health check?

Reviewing your core business documents is one of those tasks that is so easy to put off. It is never the right time, and there is always something more urgent to deal with.

But ignore it at your peril and you are only storing up problems for the future.

The Government has announced new National Minimum Wage (NMW) rates that will apply from 1 October 2009.

For workers aged 22 and over, the rate will increase from £5.73 to £5.80 an hour. The rate for 18- to 21-year-olds will rise from £4.77 to £4.83 and for 16- and 17-year-olds the rate will increase from £3.53 an hour to £3.57.

The accommodation offset will rise from £4.46 per day to £4.51 from 1 October 2009.

Dismissal by reason of redundancy may be fair or unfair. In particular, it will be unfair dismissal if the selection of a particular individual for redundancy was unfair or if there was a total failure to consider suitable alternative employment. Prior to the repeal of the statutory dispute resolution procedures, a dismissal by reason of redundancy was automatically unfair if the statutory procedures required before an employee could be properly dismissed were not followed.

From 6 April 2009, the statutory right to request flexible working arrangements is extended to parents of children aged 16 and under. Employees with caring responsibilities for children aged up to 6 (18 and under where the child is disabled) and carers of adults already have this right.
An employee must have completed 26 weeks' continuous employment with their employer in order to qualify for the right and can only make one request in any 12-month period.

There is a statutory procedure which must be followed when a request for flexible working arrangements is made.

Section 4A(3) of the Disability Discrimination Act 1995 (DDA) states that an employer is exempt from the duty to make reasonable adjustments for a disabled person if the employer does not know, and could not reasonably be expected to know, that the person has a disability and is likely to be put at a substantial disadvantage compared with a non-disabled person by any workplace provision, criterion or practice or by any physical feature of the workplace.

Whether or not a worker is an employee (working under a contract of service) or is self-employed (working under a contract for services) is an important distinction for tax as well as employment law purposes and HM Revenue and Customs (HMRC) will challenge the employment status of workers if they consider that the arrangements in place do not reflect the reality of the working relationship.

Whilst all aspects of the nature of the employment relationship should be taken into account, for a contract of service to exist, the following must be present:

The Government's Equality Bill will include measures aimed at eradicating the pay gap that still exists in many workplaces between men and women. Incremental pay scales based on length of service can disadvantage women, who are more likely to have fewer years' service either because of career breaks to look after children or because they are relatively new entrants into traditionally male-dominated professions.

More and more workers are spending a large part of their day looking at a computer screen. The Health and Safety (Display Screen Equipment) Regulations 1992 specifically deal with the health and safety issues associated with working with VDUs.

The Employment Appeal Tribunal (EAT) has clarified that there are only limited circumstances in which an employee's unambiguous words of resignation should not be relied upon because they can be regarded as being given in the heat of the moment (Ali v Birmingham City Council).

Mr Mohammed Ali worked for Birmingham City Council as a data entry clerk. On 25 April 2007, Mr Ali handed in his resignation to his manager. He claimed that at the time he was very stressed for personal reasons and was not 'thinking straight'.

A cyclist who had chosen not to wear a safety helmet and who was injured in a collision with a motorcycle has been awarded the full amount of personal injury compensation in the High Court. However, the judge warned other cyclists that compensation may be reduced if not wearing a helmet is considered to be a factor in the seriousness of an injury.

Changes to employment law and practice led by the Department for Business, Enterprise and Regulatory Reform are normally implemented in either April of October. The reason for this is to make life easier for employers, who must ensure that their policies and procedures comply by the implementation dates - or risk significant penalties.

The main changes due to be introduced in April 2009 are:

Repeal of the Dispute Resolution Procedures - 6 April 2009

Financial settlements on divorce normally involve making financial provision for any children but, in a recent case, the ex-wife of a wealthy man successfully argued that her love of horses was sufficiently important to her that substantial maintenance should be payable for their upkeep.