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GDPR Guide and Steps to Take

The General Data Protection Regulation (GDPR) is a comprehensive data protection regime which will start to be enforced in the UK in May 2018. The penalties for non-compliance can be very substantial – for serious breaches, up to 4 per cent of global...

Failing to Plan Ahead Creates Problems for Family Companies

Although no one likes to think about their own death, failing to be prepared for all eventualities can cause chaos in family companies, which are often dependent for their success on the skills of a small number of people. The point could hardly have been...

Small Data Protection Glitch Produces Big Financial Loss

When a local council published information in connection with a family's planning application for building works, it failed to think through the consequences of its actions. The result was that it placed sensitive personal data in the public domain. The...

Free Advice Given and No Contract? You May Be Liable

Any professional will know that there are many people who like to have free advice, and whilst this is seldom proffered in a social setting such as the pub, it is normal for friends to give one another advice. It was therefore unremarkable when a couple who...

Failure to Comply With Regulation Brings Jail for Moneylenders

Commercial moneylending is, with good reason, heavily regulated to ensure that unfair advantage is not taken of vulnerable borrowers. In one case that made that clear, two men who provided over £750,000 in finance to taxi drivers without any legal...

Government Bank Sale Tendering Dispute - High Court Ruling

Public tendering exercises almost inevitably leave unsuccessful bidders dissatisfied but the courts will only intervene if there is a legal flaw in the process. A consortium behind a failed bid to acquire a government-owned bank found that out when the High...

High Court Rules on Fall-Out From Wine Company Insolvency

Insolvency proceedings that arise in the midst of an ongoing trading relationship can sometimes result in large sums of money remaining in limbo for a significant period. In one such case, the High Court ruled on the correct destination of more than 870,000...

Engineers Must Pay for Defective Design of Seaside Storm Culvert

Contract arbitrators' decisions are meant to be final and challenging them is always an uphill struggle. This point was illustrated by one case in which the High Court upheld a six-figure award to a local authority in respect of a defectively designed...

Cartel Whistleblower Avoids Massive Fine

Being in a cartel is unlawful and is a risky business – especially when one of the cartel members blows the whistle on the others. In such circumstances, the whistleblower can receive immunity from punishment, leaving the other members to carry the...

Directors Guilty of Misfeasance in Insolvency Proceedings

Some directors will always sadly be tempted to denude troubled businesses of their assets before they formally become insolvent. However, companies are not personal piggy-banks and, as one High Court case showed , the consequences of such conduct can be...

Knife-Edge Timing Solves £2.4 Million Construction Contract Dispute

In a striking piece of knife-edge timing, a property developer has convinced the High Court that it was reassigned rights under a construction contract just before a multi-million-pound dispute was placed before an adjudicator. The decision means that the...

English Jurisdiction Clauses - Court of Appeal Cracks Down

English law is well-developed, written in the universal business language and the English judicial system has a deserved reputation for fairness. It is not surprising, therefore, that vast numbers of international contracts incorporate English jurisdiction...

New Rules to Prevent Corporate E-Signatures

The law has tried to play 'catch up' with the increasing sophistication of cyber-crime since the advent of the Internet, and new EU regulations implemented in the UK as the Electronic Identification and Trust Services for Electronic Transactions Regulations...

Data protection shield

The EU Data Protection Directive only permits transfers of personal data from the EU to territories outside the European Economic Area if adequate protection for that data is ensured in the receiving territory. Previously, the Safe Harbor framework was an...

Company Articles Triumph in Share Valuation Dispute

People tend to think of the articles of association of companies – and often shareholders' agreements – as matters of detail not warranting close attention. However, a recent case shows the importance of having up-to-date knowledge of such...

Bank Fails to Avoid Guarantee Liability

The sums of money involved in international trade are so vast that without bank guarantees to underpin contracts, the wheels of commerce would cease to turn. However, as one High Court case vividly revealed , banks normally insist that all the formalities...

Court Guidance on Jurisdiction

When contracts have an international element and a dispute arises, it is often necessary to ascertain at a very early stage which country's courts have jurisdiction to deal with the dispute. In the case of a dispute over a contract, the place of performance...

Failure to Adopt Sound Business Principles Proves Costly

Cases involving negligent valuations have been passing through the courts steadily over the years – many triggered by the financial meltdown in 2008. A recent decision involved the reliance of a bank on a valuation provided in support of a £1.8...

Continued Use of Defective Devices - Who is at Fault?

Disputes between insurers and claimants under insurance policies are common, and a recent dispute raised an interesting question: What is the position if a person or business uses a device which they know to be faulty and this results in subsequent damage?...

Slipshod Execution of Contracts Can Come Back to Haunt You!

Slipshod execution of contractual documents can come back to haunt you, and that is one good reason why you should always have the benefit of qualified legal advice. In one case , the waters were so muddied that the High Court was unable to say, without...

What You Do as Well as What You Agree in Writing Matters

It is a common misconception that contracts have to be agreed in writing or orally to be binding. However, a contract can also be valid if it is performed…even if the documentation requires that it must be formally agreed to be valid. A recent case...

Swift Justice Sees Director Receive £105,000 Bill

It is regrettably not unheard of for directors to flout their duties and help themselves to company money to which they are not entitled. However, one High Court case showed that professionally managed litigation can be a swift means of catching up with...

Winding Up Petitions and Validation Orders - High Court Guidance

From the moment a winding up petition is presented against a company, any payments that it makes become legally void if a winding up order is granted. However, what happens if supplies are made to that company before the supplier is aware of the winding up...

In Business With a Friend? Don't Dispense With Formalities

When entering into a business partnership with someone you also consider to be a soulmate, putting in place formal agreements with them can seem inappropriate. However, personal relationships can turn sour and, in one case, the equity in a buy-to-let...

High Court Brings Clarity to Multi-Million-Pound Consultancy Contract

One might expect contracts between sophisticated business entities to be couched in precise and unambiguous terms. That is not always the case, however, and the High Court's intervention was required to bring clarity to a jurisdiction clause in a...

Disloyal Director Pays Price for Serving Her Own Agenda

Directors are under a duty to act in good faith and to do all that they reasonably can to promote the success of the companies they serve. Breaching those obligations can be costly, as one businesswoman found out after the High Court ruled that she had...

But We Agreed, Didn't We?

Contract law abounds with disputes over whether a binding contract has been created at a point in time, and many cases have been heard in which one side to the dispute alleges that a contract has been made whilst the other claims that an 'agreement to agree'...

ICO Warns Rogue Directors Not to Expect an Easy Ride

Not all action against directors when a company goes broke is initiated by the Insolvency Service. Recently, the Information Commissioner's Office (ICO) issued a warning to rogue directors that it will take strong measures to enforce the payment of fines it...

Changes to Company Reporting Requirements

The annual return, a fixture of the company reporting cycle for decades, is being replaced by a simpler 'confirmation statement'. The main impact of the change is that the confirmation statement will not require information that has not changed to be...

Attempt to Blame Accountants for Disappointment Fails

Accountants who perform due diligence work on acquisitions are almost always in the firing line if the deal does not provide the expected outcome for the purchaser, but a recent case shows the limits of their liability in such cases. The case involved the...

Succession, Retirement and Profitability Key Business Issues

Whilst remaining profitable is the top concern for family business owners, recent research published by Close Brothers Asset Management shows that four out of the top ten worries of those surveyed are related to succession planning, with provision for...

Whole Offer, Not Part, Determines Liability for Costs

In English law, the normal rule in a contested case is that the loser pays the winner's costs. Where an offer to settle a case is made, the rule is modified. If the case then goes to court, in simple terms the loser still pays if the court makes an award...

Public Ownership and Control Register - What it Means for You

Increasing public disquiet over the use of 'tax haven' companies and trusts to disguise the beneficial ownership of businesses and properties has led to the Government taking steps to improve the transparency of ownership. Such arrangements are often used...

Debt Collection By Threat Brings Prosecution

When a creditor appointed two 'informal' debt collectors to collect money due from a debtor, the tactics they used resulted in them being given prison terms by the Court of Appeal. A landscape gardener was beset by financial problems and one of his...

Flower Dealer Triumphs Over Officialdom in Orchid Bulbs Row

Officialdom is a necessary, if occasionally irritating, fact of life, but one case has shown that an overzealous application of the rules can be beaten with tenacity and good legal advice. It involved an award-winning flower dealer, which had almost 1,500...

High Court Ruling Reveals Downsides of the Corporate Veil

Everyone knows that the corporate veil has the advantage of shielding directors from personal liability. However, far fewer people are aware of its downsides. In one case which illustrates this point , a businessman who dealt with a bank entirely through...

Fallen Out With Business Partners? Remember the Duties You Owe Them!

Business relationships sometimes end badly, but the duties that partners owe to look after each other's interests continue until formal dissolution. In one case, two couples who set up a private car hire and chauffeur business lost sight of that principle as...

Court Upholds Challenge to Tender Process After Contract Signed

In a ruling which should be required reading for those who deal with public authorities, a company which claims that it was unjustly denied a nuclear plant decommissioning contract, following a flawed tendering process, had its hopes of receiving up to...

Emails Are Variations in Writing

It is normal for contracts to contain clauses which specify that variations in the contract must be made in writing. The nature of business is such that contract variations are relatively commonplace and this can cause difficulty if the paperwork fails to...

Ship Owners Pay Dearly for Failing to Meet Litigation Deadline

A case concerning a maritime collision at the entrance to a Black Sea port serves as a warning to all that litigation deadlines are strictly enforced and that failing to meet them – even by a matter of hours – can have disastrous consequences. ...

Are Your Anti-Money Laundering Procedures Compliant?

It might be thought by many that money laundering is an esoteric crime that is practised only by professionals in positions of authority or influence, but this is not so. Money laundering supports terrorism, drug dealing and other unlawful activities and,...

Company Restoration Turns Clock Back

When a company ceases to exist and is struck off the register of companies at Companies House, any assets it owns become the property of the Crown. The Crown has the ability to disclaim the property if it chooses. Recently, the High Court had to consider ...

Certificates of title

Birkett Long were requested to provide certificates of title for 24 freehold properties owned by a long-term client. We used the strength and breadth of our Real Estate Team and the Corporate Team to deal with the high level of work involved, assisted by...

Ignoring Court Ruling Brings Threat of Jail for Nightclub Owner

It is now quite well known that the public broadcast of music which is still under copyright requires a licence, but not many people appreciate that ignoring that requirement can lead to a jail sentence. A Newport nightclub owner who failed to obtain a...

High Court Rules on £7 Million Reality TV Contract Dispute

Personality clashes can obviously cause difficulties in business, but they are rarely serious enough to justify cancelling commercial contracts. In one striking case, a television channel was ordered to pay substantial damages to a production company after...

Are You Dispute Friendly? New Rules Require You to Be

Since 1 October 2015, under changes introduced by the Consumer Rights Act  2015 , it has been compulsory for most businesses to offer Alternative Dispute Resolution (ADR) to their customers if a complaint arises between them which cannot be settled by...

Defiant Directors Jailed in High Court Arbitration Dispute

Decisions of arbitrators are ultimately backed by the authority of the High Court and those who fail to abide by their awards can face heavy financial penalties and even loss of liberty. In one case , directors of a grain trading company were sentenced to...

Asset Based Finance Boom Sign of Increasing Investment

A sign that the level of business investment in the economy is on the up comes in the form of a report that 'asset based' borrowing to finance business assets and property increased to an all-time high of £4.2 billion in 2014, up 9 per cent on the...

Asset purchases with long-term interests

Birkett Long acted on behalf of a partner selling their interest in a farming partnership. The transaction involves complex tax planning arrangements to ensure the protection of entrepreneur’s relief for both the outgoing and the continuing partner....

Anticipation of Variation Does Not Derail Tender Fairness

The rules relating to public sector tendering are complex, but it is necessary that public sector procurement processes are both fair and seen to be fair. However, this can be problematic in many projects, where variations once the contract is in progress...

Claim Denied for Unmonitored Alarm

A recent case highlights the changes that will be coming into effect next year when the Insurance Act 2015 comes into force, reducing the number of 'technical' defences that can be used by insurance companies to avoid paying out on claims. The case...

The Consumer Rights Act 2015 - Changes to Unfair Contract Terms Legislation

Businesses that deal with members of the public are reminded that the Consumer Rights Act 2015 , which received the Royal Assent on 26 March, became law on 1 October 2015. The Act replaces a number of laws with regard to business-to-consumer transactions,...

Omitted Takings Affect Share Valuation, Rules Court

A recent case on company valuation may well end up being of great interest to HM Revenue and Customs (HMRC) as well as the two directors involved. It concerned a company which operated a restaurant. When the directors fell out, in order to enable one...

Company That Didn't Do Homework Faces Delay and Costs

Failing to do one's 'due diligence', and in particular failing to check out the bona fides and financial stability of trading partners, can prove to be a massive mistake. In a recent instance, a construction company that failed to take appropriate steps and...

Entering Into a Partnership? Get it in Writing!

Business partners who failed to define their working relationship in writing – instead reaching agreements orally over bottles of red wine in a pub – paid the price when a dispute over money erupted and made its way to the Court of Appeal . ...

Inability to Prove Counterclaim Fatal

Running an airline profitably is critically dependent on keeping planes in the air as much of the time as possible, so when an airline enters into a contract relating to its fleet, 'on-time' delivery is very important. Also key is the need to provide a...

Nuisance Calls and Texts Law Change

Since 6 April 2015, changes to the law have given the Information Commissioner's Office (ICO) enhanced powers to take action against companies making nuisance marketing calls and sending spam messages. Previously, the ICO could only issue a civil monetary...

$30 Million Contract Dispute Hinged on a Single Word

A case in which the outcome of a $30 million dispute hung on the interpretation of a single word proves the point that the drafting of commercial contracts is not for the uninitiated and is better entrusted to legal professionals. An investment bank had...

Sales and international affairs

Birkett long acts for a number of multinational corporations providing assistance on cross border work. For example we advised two multinational corporations, both headquartered in France, on legal aspects of their UK businesses in the automotive and...

Consumer Protection Enhancement Law - Time to Get Ready

Businesses that deal with the public are reminded that legislation will come into effect soon to give consumers better protection under the law than they currently have. The Consumer Rights Act 2015 received the Royal Assent on 26 March and becomes law on...

Failure to Comply With Purchase Terms Proves Costly

Selling a company can be fraught with difficulties, particularly where payment for shares is deferred and the price payable is calculated on the basis of performance. In one such case , a disagreement between buyer and seller resulted in a round of costly...

Read Your Insurance Policy!

Disputes over what insurance policies do or do not cover are legion, and a recent survey carried out by the British Insurance Brokers' Association is a timely reminder of the risks of not knowing the scope and limitations of the insurance policies you buy. ...

Problems With Warranties on Business Sales

When a company's shares are sold and the business continues, it is usual for some form of warranty to be given with regard to the accuracy of any information provided to the purchaser. Sometimes there will be an 'earn out', which limits the risk to the...

Conduct Costs Despite Court Win

There is a general rule that the loser pays the costs of a legal dispute. When an offer to settle a claim is made by a defendant, the legal costs of the person making the claim will be paid by the defendant if the case goes to court and the claimant is...

Misrepresentation Invalidates Adjudicator Appointment

As the main contractor for major works on London Underground, electronics giant Siemens retained a subcontractor to install communications equipment at various stations. When the works did not progress as desired, a dispute arose between Siemens and the...

Directors - do you understand your responsibilities?

Being a director of a company gives rise to a number of responsibilities – and not all directors are aware of the extent of these. Here is a summary of the key areas: Directors’ powers Directors should check whether there are restrictions on...

Misled Directors Earn Rights in Company

A one-armed businessman, who went to war with his former friends over control of a successful talent agency for amputee stuntmen, has been criticised by a judge for his determination to ‘jealously and selfishly’ guard his own financial interests....

Refusal to Mediate Justified, Rules Court

Normally, a refusal to mediate will incur the displeasure of the court and can be expensive if the court decides that the legal costs were higher than need be because of the refusal. However, when a case is sound, mediation is not always the right answer,...

Terms of Engagement Determine Liability for Advice, Rules Court

When a firm of accountants approached a client regarding investing in a management buyout (MBO) that needed finance, the end result was that the client lent the company set up to invest in the MBO company £15 million. Such loans are not advanced...

Contract Wording Leads to $12.5 Million Payout

Millions can hang on the precise wording of a contract. Just how important this can be was illustrated in a recent case in which an agreement in respect of a major oil pipeline project brought bitter discord after grave flaws in its drafting led to a...

Bias Apparent, Not Real, Rules Court of Appeal

Just because a court ruling seems harsh does not mean that the judge making it was biased, as is illustrated by a decision by the Court of Appeal that a judge was wrong to disqualify himself from continuing to hear a highly contentious case after he was...

Unlawful Intent Does Not Prevent Recovery of Debt

Although, as a general rule, an illegal contract is unenforceable, a City broker who offered to supply insider information to a friend for £620,000 but then reneged on the promise has been ordered to repay the money. The broker claimed to have access...

Not All Mistakes Are Mistakes

It is fairly widely known that in a legal dispute some documents can be 'privileged', which means that they cannot be used in evidence. Normally, communications between a solicitor and their client are privileged. However, the right of privilege is not...

Company Caught in Takeover Debacle Wins Its Money Back

A company that paid more than £17 million too much for another company's shares – due to inaccuracies in the latter's accounts – will get most of that money back from insurers, following a High Court ruling . Company A had bought the...

Foreign Director Can't Escape English Jurisdiction

In a ruling which powerfully confirmed the extra-territorial reach of the English courts , the Court of Appeal has opened the way for civil proceedings for contempt of court to be brought against the managing director of two overseas companies despite the...