A recent change to the way in which compensation for seriously injured negligence victims is calculated has led to a dramatic increase in the size of awards – but they are still no more than is needed to ensure that their care needs are met for life.
One case concerned a young cerebral palsy sufferer who will never be able to live independently after he was starved of oxygen during his birth. The NHS trust that managed the hospital where he was delivered admitted full liability for his injuries and issued an apology to him and his family at the High Court.
Following negotiations with the boy’s legal team, the trust agreed to pay a lump sum of £6,874,283, plus index-linked and tax-free annual sums to cover the costs of his lifelong care. Those payments will start at £155,000, rising in steps to £215,000 when he reaches the age of 60. If he attains the age of 70, the total compensation package will be worth around £18 million.
The settlement was negotiated in the light of a change in the discount rate that is applied to compensation awards to take account of the claimant's returns when the lump sum is invested. The discount rate has recently been reduced to minus 0.75 per cent, having previously been unchanged at 2.5 per cent since 2001, to take account of historically low returns on investments.
There are some ‘big money’ cases where a stellar earner’s financial contribution to a marriage is considered so exceptional that the Court will take it into account when dividing assets between parties. The Court of Appeal considered that issue in an important test case concerning a finance professional who earned £240 million in little more than a decade.
The former couple had been married for almost 20 years and had two children together. Both had been modest earners before the husband completed an MBA course and obtained a job with a private equity firm. Despite their high expenditure - including almost £3 million on divorce proceedings - their fortune still amounted to over £180 million by the time their divorce was finalised.
As well as being a home maker and mother to their children, the wife had supported the husband during his studies. In awarding her half of the marital wealth, a family judge found that they had formed a strong and equal partnership. Each of them had contributed emotionally and financially to the marriage and the judge found that an unequal division would amount to unjustifiable gender discrimination.
The husband argued that he should have received a 61 per cent share of the marital assets to reflect the enormous wealth that he had generated. In dismissing his appeal, however, the Court ruled that his financial contribution was not so wholly exceptional as to justify a departure from equality. The judge was in the best position to assess the evidence and had fully explained his conclusions.
If you would like to discuss your options or if you are concerned family legal issues please contact Amanda Holland or a member of our family team on 0121 698 2200, email email@example.com or fill in our online enquiry form.
Private Finance Initiatives (“PFI”) bring the public and private sectors together to complete projects that could not be financially afforded out of the public purse alone. However, in one case concerning a £46 million tourist attraction in a seaside town, a prudent balance had to be struck between commercial confidentiality and the freedom of information.
In this case, the local council loaned £36 million to a single purpose company that developed a high viewing tower as a tourist attraction. The remaining finance was provided by a private sponsor. A member of the public had requested full disclosure of a detailed consultancy report that informed of the council’s decision to enter into this particular PFI. That request was upheld by the Information Commissioner’s Office on the basis that the public interest in disclosure outweighed any potential damage to commercial interests.
In allowing the Council’s appeal against that ruling, the First-tier Tribunal noted that the information sought included pricing information in a highly competitive market and detailed projections of visitor numbers, profits, staffing requirements and overhead costs. Although a large sum of public money was involved in the loan, there was a powerful public interest in transparency. It was held that the council and the company would suffer grave commercial disadvantages from full disclosure.
In an important decision for owners of student accommodation or houses in multiple occupation (HMOs), the Court of Appeal has ruled that a licensing condition that restricted occupation of two small attic bedrooms to full-time students was lawful.
The rooms were both located in semi-detached houses owned by the same landlord. The local authority took the view that, due to their sloping ceilings, their usable floor areas fell below its benchmark figure of eight square metres. In licensing both houses as HMOs under the Housing Act 2004, it imposed conditions requiring that neither room should be used as a bedroom on the basis that they were not reasonably suitable for occupation as such.
After the landlord appealed, the First-tier Tribunal found that the rooms were acceptable for use as bedrooms by full-time students and amended the licences accordingly. It did so on the basis that students who were sharing digs could be expected to live cohesively as a group. The houses included sufficient shared space to counter-balance the small size of the attic rooms. That decision was subsequently upheld by the Upper Tribunal.
In dismissing the council’s challenge to the latter ruling, the Court rejected arguments that the physical characteristics of the properties alone were relevant for the purposes of the HMO licensing regime. On a true interpretation of the relevant statutory provisions, the personal characteristics of potential occupiers could also be taken into account. The council’s plea that the 'students only' condition would be incapable of effective enforcement also fell on fallow ground.
One of the primary reasons why you should always employ a specialist solicitor to represent you in litigation is the need to put emotion to one side. In one case where that sadly did not happen, two sons squandered their entire £125,000 inheritance in pursuing a hopeless challenge to their father’s will.
After a number of special bequests, the father had left £125,000 of the remainder of his estate to his second wife and the same amount to be split equally between his sons from a previous marriage. He had suffered from Parkinson’s disease for some years and the sons argued that he lacked the required capacity to make a valid will. They claimed that an earlier document, by which he had divided his estate equally between them and their stepmother, was his last true will.
In dismissing the sons’ challenge, a judge found that their conduct of the litigation had been wholly unreasonable and that their stepmother should never have been put to the trouble of defending their claim. Their case had been driven by personal issues, in particular their refusal to accept that their father and stepmother were a devoted couple and the extent to which she had cared for him during his illness. In the circumstances, the sons were ordered to pay the legal costs of the case, estimated at £200,000.
Winding up petitions are an extremely serious matter for any company and must not be used as a means to apply pressure to pay disputed debts. The Companies Court made that point in granting an injunction that restrained the presentation of a petition in the midst of an ongoing building contract dispute.
A subcontractor who had been employed to carry out ground works claimed to have been underpaid by more than £100,000 for work that it had performed. It served a statutory demand on the contractor and, when that was not satisfied, threatened to launch a winding up petition.
In ruling on the case, the Court noted that it was not its function to try such disputed claims. Winding up petitions were damaging to corporate reputations and seriously impacted on their freedom to carry on business. There was a real risk that petitions might be issued to improperly apply pressure for payment of disputed debts.
In granting the injunction, the Court noted that there was a genuine and substantial dispute between the subcontractor and the contractor as to the value of the works carried out and as to whether any money was in fact owed. There was also a real question as to whether the subcontractor had issued a valid payment application and the contractor had put forward a substantial counterclaim.
The dividing line between ‘workers’ and ‘employees’ can be very difficult to discern, but is of the greatest significance. That was certainly so in the case of one man who worked for a charity for years without any form of written contract.
The man, who started out as a paid intern on a trial basis, received about £1,000 a month for performing a wide range of tasks, many of them concerned with assisting the charity’s founder in dealing with personal matters. Neither he nor the charity made any account for Income Tax or National Insurance Contributions.
Following his acrimonious departure, he lodged complaints with an Employment Tribunal (ET), which accepted that he was a worker but found that he was not an employee within the meaning of the Employment Rights Act 1996.
The ET found that the absence of a written contract or provision for holiday pay, and the fact that he was generally only remunerated when he worked, were inconsistent with employment status. As a result of that ruling, his whistleblowing and unfair dismissal claims were struck out.
In upholding his challenge to those aspects of the decision that were adverse to him, the Employment Appeal Tribunal found that the ET had erred in law. Those factors that were said to be inconsistent with employment status were in truth no more than pointers in that direction. The ET had also made an apparent factual mistake in respect of his receipt of holiday pay. The case was sent back to the same ET for fresh consideration.
No matter how deeply those on either end of a telephone line may trust each other, it is a hostage to fortune to reach commercial agreements over the phone without later confirming them formally in writing. One Court of Appeal case concerning the offshore drilling business illustrated the risks of not having formal written agreements.
A drilling company (company A) chartered a deep-water drilling vessel to a multinational oil company. Company B had a consultancy agreement with company A and claimed that it had been promised a 0.25 per cent commission on revenues generated by the charter. The commission was said to have been agreed during a 25-minute telephone conversation between two of the companies’ senior executives.
Given the lack of any written record of the high-value agreement, the case hinged on pure questions of fact and the reliability of the executives’ recollections as to what was said during the conversation. A judge ultimately preferred company B’s case and found that a binding agreement to pay the commission had been reached.
In rejecting company A’s challenge to that ruling, the Court found that the judge was entitled to accept company B’s explanation as to why the agreement had not been confirmed in writing. The judge had produced a careful and well-reasoned decision which could not justifiably be set aside.
A great Movers and Shakers professional networking event for Sydney Mitchell with over 50 professionals from in and around the Midlands meeting at Ginger’s Bar, Purnell’s Bistro in Newhall Street Birmingham on 4 April 2017.
An excellent turnout; with many guests commenting on the relaxed atmosphere and the good cross–section of professionals joining in from the city. The food as always was superb; provided by Glyn Purnell and his team.
Sydney Mitchell specialist teams include employment, commercial property, company and commercial services, litigation, insolvency, licensing and gambling law. Private client teams include family law, residential property, dispute resolution and wills and probate, tax and trusts and personal injury.
Pictures: (link below to Album from event)
Clive Perks ... Supportive Financial Planning
Andrea Jones ... Sydney Mitchell
Clive Margetts ....The Business Success Consultant
Stewart Coles ... Sydney Mitchell
Angela Hyde ... Sydney Mitchell
Richard Smith ... PGC
Suzanna Patalong ... Sydney Mitchell
Nick Frost ... LEBC Group
Paul Fielding ... Brewin Dolphin
Amanda Holland ... Sydney Mitchell
Paul Sargent .... Brewin Dolphin
Ian Morgan ...RBS
Kay Passars .... CVR Global LLP
Paul Maycock ... Handelsbanken
Andy McGill ... Smith & Willaimson
Morgan Keating .... AIB
Rebecca Gadd .... AIB
Joph Young ... Smith & Williamson
Lucy Bluck ...Sydney Mitchell
Ellie Lewis ... Dains LLP
Shelley Collingbourne ... Sydney Mitchell
Mike Hobbis ... GE Capital
Linda Heyworth ... Sydney Mitchell
Gerald Irwin ... Irwin Insolvency
Sundeep Bilkhu ... Sydney Mitchell
Ian Marriott ... Index Property Information
Hayley-Jo Lockley... Sydney Mitchell
In an important decision, the Court of Appeal has called upon Parliament to consider the introduction of ‘no fault’ divorce that does not depend upon either unreasonable behaviour or years of separation. The Court made its comments in the case of a pensioner who objected to being locked into a loveless marriage.
The Matrimonial Causes Act 1973 enables divorce petitions to be granted in cases where marriages have irretrievably broken down. That is deemed to have occurred in cases of adultery and where one party to a marriage cannot reasonably be expected to live with the other due to the latter’s unreasonable behaviour. Where there is no such fault, divorces will be granted only after two years of separation, with the consent of both parties, or after five years if such consent is not forthcoming.
In the case in question, a woman in her 60s had petitioned for a decree nisi following the breakdown of her 37-year marriage. She argued that her husband had behaved unreasonably in various ways, including disparaging her in front of her friends and family. Her petition was, however, rejected by a judge on the basis that she could reasonably be expected to continue living with her husband. Her criticisms of his conduct were exaggerated and flimsy at best, the judge found.
In rejecting her challenge to that ruling, the Court could find no flaw in the judge’s assessment of the evidence or his approach to the law. It reached that conclusion with no enthusiasm, however, and observed that the marriage was clearly over and that the wife had been left in a very unhappy position. She would be approaching 70 before she would be able to obtain a divorce under the five-year separation rule.
In its judgment, the Court questioned whether the time had come for the introduction of a broader category of no fault divorce. It noted that, of almost 114,000 divorce petitions issued in the year to January 2017, only a trivial number – about 0.015 per cent – were actively resisted. Given that minutely small number of cases, it was hard to see why an insistence on proof of fault remained necessary.