Legal Updates

 

Our members contribute to a host of publications, including Lexis PSL, the STEP Journal, and Insolvency Intelligence, in addition to producing regular in-house content.

No loss, no gain, no mesne profit?

Author: Jeff Hardman

Practice Areas: Property

Date: 22 Apr 2021

Wigan BC v Scullingdale Global Ltd [2021] EWHC 779 (Ch)

Date of decision: 1 April 2021

Court: High Court

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Interpreting repairing covenants - `construing` rather than `re-writing`

Author: Jeff Hardman

Practice Areas: Property

Date: 22 Apr 2021

City of London v Various Leaseholders of Great Arthur House [2021] EWCA Civ 431

Date of decision: 25 March 2021

Court: Court of Appeal

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The importance of contemporary documents as a means of getting at the truth

Author: Jeff Hardman

Practice Areas: Trusts, Wills & Estates

Date: 22 Apr 2021

Mundil-Williams v Williams [2021] EWHC 586 (Ch)

Date of decision: 16 March 2021

Court: High Court, Business & Property Courts in Wales

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Proprietary estoppel: Moving beyond the long shadow cast by Cobbe v Yeoman's Row Management Ltd [2008] UKHL 55

Author: Jeff Hardman

Practice Areas: Property | Trusts, Wills & Estates

Date: 19 Apr 2021

Case review: Howe & Anor v Gossop & Anor [2021] EWHC 637 (Ch)
Date of decision: 19 March 2021

To read this article, please click here.

Secrets Revisited - Wood v Commercial First in the Court of Appeal

Author: James Saunders

Practice Areas: Commercial Litigation

Date: 12 Apr 2021

The Court of Appeal has recently handed down judgment in two appeals raising the same issues of half and fully secret commissions. The resulting judgment clarifies the test for fully secret commissions, outlines when the more generous remedies for such commissions will be available and provides a useful examination of the relevance of agency retainers in the context of bribes.

James Saunders considered the first instance decision in Wood in late 2019 and in this article examines the approach taken to the issues by the Court of Appeal. The decision is of particular note for those advising any party to a commercial agreement which involves a negotiating or proposing intermediary, particularly as regards how much disclosure will suffice to negate a fully secret commission.

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New edition of the Probate Practitioner’s Handbook

Author: Alexander Learmonth QC

Date: 10 Mar 2021

The new edition of the Probate Practitioner’s Handbook, which includes chapters by Alexander Learmonth on the revocation of wills and interpretation and rectification of wills, has recently been published.

Procedural vandalism and the Solicitors Act 1974: Carpmaels & Ransford LLP and Collyer Bristow LLP v Regen Lab SA [2021] 2 WLUK 244

Author: James McKean

Practice Areas: Commercial Litigation

Date: 09 Mar 2021

James McKean represented the Claimants, two firms of solicitors and intellectual property lawyers, who resisted an application to set aside a default judgment.

The Claimants were owed fees in excess of £600,000, having represented the Defendant, a Swiss biotechnology company, in the Regen Lab SA v Estar Medical Limited [2019] EWHC 63 (Pat) patent litigation.

The Defendant acknowledged service but failed to file a defence or contest jurisdiction. Default judgment was obtained.

The Defendant’s application to set aside the judgment consisted of a jurisdictional challenge and technical objections under the Solicitors Act 1974 to the bills submitted by the Claimants. Waksman J found these arguments to have no prospects of success and refused the Defendant relief from sanctions.

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Donatio Mortis Causa or “Death Bed Gifts” Davey v Bailey [2021] EWHC 445 (Ch)

Author: James Saunders

Practice Areas: Trusts, Wills & Estates

Date: 03 Mar 2021

The recent decision in Davey has brought the doctrine of donation mortis causa back into the spotlight in the midst of a pandemic which has rendered many gravely ill and potentially unable to put their affairs in order, despite the provision for the witnessing of wills by video. James Saunders examines the decision in Davey and reviews the conditions for a valid DMC. The potential issues which may arise in cases connected with Covid-19 are also discussed.

 

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Transactions at an Undervalue – Beneficial Interests and Declarations of Trust: Lyle v Bedborough [2021] EWHC 220 (Ch)

Author: James Saunders

Practice Areas: Insolvency | Property | Trusts, Wills & Estates

Date: 18 Feb 2021

A Property was purchased in the joint names of Mr and Mrs Bedborough in 1994. In 2008 the Respondents’ evidence is that they entered into an oral agreement by which Mr Bedborough would transfer his interest to Mrs Bedborough (the “2008 Agreement”). In December 2012, the Respondents entered into a declaration of trust by which they declared that they held their interests in the Property as tenants in common for Mr Bedborough as to a 5% share and Mrs Bedborough as to a 95% share (the “2012 Declaration”).

Mr Bedborough relied upon the 2008 Agreement, being beyond the 5-year relevant period under S.339 on the Insolvency Act 1986, whilst the Applicant Trustees denied the 2008 Agreement had any effect with the only transfer being made pursuant to the 2012 Declaration, within the relevant period and at an undervalue.

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Court refuses to approve tainted fiduciary decision making (Schumacher v Clarke)

Author: James Saunders

Practice Areas: Trusts, Wills & Estates

Date: 17 Feb 2021

Private Client analysis: The court was faced with a category 2 and 3 Public Trustee v Cooper application principally for the approval of a momentous decision. The court was initially asked to approve the entirety of a settlement reached between four trustees split into two camps but later asked to approve only the dispositive elements of the settlement. The settlement unusually resolved disputes between the trustees rather than between trustees and beneficiaries or third parties. The court was concerned with mutual allegations of inappropriate action as fiduciaries and the failure of both sides to manage conflicts of interest in arriving at a settlement. After stressing that such factors could impair the decision reached and which the court was asked to approve, the court refused its approval of part of the settlement.

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Kids Company: Important Directors Disqualification Case in a Charity Context

Author: William Hopkin

Date: 17 Feb 2021

On 12th February 2021, Mrs Justice Falk handed down her judgment in Re Keeping Kids Company (Official Receiver v Sunetra Atkinson & others) [2021] EWHC 175 (Ch).

 

Facts:

Kids Company, a well-known children’s charity, entered insolvent liquidation in 2015. After a long investigation, the Official Receiver commenced proceedings against all of the (recent) directors, together with the CEO, seeking to disqualify each of them under s.6 Company Directors Disqualification Act 1986.  

 

Charitable context:

The Official Receiver argued that Kids Company's status as a charity was ultimately irrelevant: it operated as a company and was therefore required to comply with company law.  

 

Falk J considered that the courts have long taken a benevolent approach towards charity trustees in circumstances where was no dishonesty or wilful misconduct is alleged:

There are good reasons of public policy for this approach. It reflects the real risk that any other approach would deter individuals who would otherwise be well suited to becoming charity trustees from doing so. It also reflects the court's recognition of the public service that charity trustees provide.” [848] 

 

The Judge referred to Stanway v Attorney General?(unreported) 5 April 2000, where the Vice Chancellor said (in the context of whether or not proceedings should be brought against charity trustees under s.32 Charities Act 1993):

"I do think that individuals who have given long periods of their time to unpaid public service – and that is what becoming a trustee of a charity involves – do deserve to have their efforts recognised by not being sued for mismanagement unless the proposed action against them is one which anyone can see cannot be resisted." 

 

Conclusions:

Falk J reach the following conclusions, in finding that a disqualification order was not warranted against any of the Trustees, or the CEO:

The charity sector depends on there being capable individuals, with a range of different skills, who are prepared to take on trusteeship roles. Most charities would, I would think, be delighted to have available to them individuals with the abilities and experience, that the Trustees in this case possess.

It is vital that the actions of public bodies do not have the effect of dissuading able and experienced individuals from becoming or remaining charity trustees. Disqualification proceedings, or the perceived risk of them, based on wide ranging but unclear allegations of incompetence, rather than any want of probity, carry a high risk of having just that effect, and great caution is therefore required.

The result of proceedings being brought, in other than the clearest of cases, is likely to be to deter many talented individuals, who take the trouble to understand and appreciate the risks, either from charitable trusteeship at all.[911]

The public need no protection from the Trustees. On the contrary, I have a great deal of respect for the care and commitment they showed in highly challenging circumstances.[912]

The CEO was not a de facto director. If I am wrong about that then I would still not have made a disqualification order against her, taking all the circumstances into account and on the basis of the allegation or allegations made against her.[913] 

 

Broader context:

The Court has confirmed its benevolent approach to charity trustees, within the context of directors disqualification proceedings.  

Further, the Judge questioned whether the Official Receiver had a proper understanding of the operation of charities. 

Importantly, Falk J felt that enforcement by the Charity Commission (which has its own powers in relation to trustee disqualification: s.181A Charities Act 2011) would, generally, be preferable.   

Legal issues relating to trees

Author: Paul Wilmshurst

Date: 01 Feb 2021

Trees can provoke a surprising number of legal disputes which frequently lead to either civil or even criminal litigation. For example:

  • Disputes over the ownership of trees and other boundary features
  • Encroaching roots or overhanging branches causing damage to property (trespass and nuisance)
  • Damage by trees that have fallen down
  • Prosecutions for breach of Tree Preservation Orders

 

Ownership of trees & boundary disputes

It may be the dispute is between neighbours about who even owns a tree or trees in the first place? The answer will depend on looking at the nature of the underlying property ownership – as trees are not like a physical object or item that can be independently owned. Often, trees will be placed along a physical boundary but there may be a dispute about whether the tree-lined physical boundary represents the true nature of the property ownership.

 

Encroaching roots or overhanging branches causing damage to property

Claims under this head. which are generally in the tort of nuisance, can often provoke a hot dispute which expert evidence required together with careful planning of the correct legal approach. The outcome of such cases is often in the balance.

  • Case example: In a leading case known as Delaware Mansions (2001) the claimant brought a claim for £570,373 - which represented the cost of underpinning work that had to be carried out because of the encroachment of tree roots of a plane tree belonging to the defendant highway authority. The defendant had not, as requested in 1989 removed the tree. It had merely carried out some root pruning. In 1990 the claimant, on further advice, carried out the underpinning. If the Council had removed the tree the cost of repairing the building would have been a mere £14,000. The Council were eventually found liable for these extremely high damages, which were clearly avoidable on the facts.
  • Case example: In the recent Berent case (2012) the claimant brought a claim in nuisance in respect of tree roots that had grown under her property. The damage to the property was caused in 2003/2004 but the trees were only removed in 2011. The trial judge dismissed the claim on the basis that the damage was not “reasonably foreseeable.”

 

Damage caused by trees that have fallen down

It is often found that perfectly healthy trees can be toppled in severe weather. On the other hand, untreated inherent defects can lead to dangerous incidents. What is the landowner’s liability if the tree has caused damage to property or other persons? What is the liability for the landowner if the tree has caused someone’s death? Landowners will often be sued for large sums in the tort of negligence (including so-called “Rylands v Fletcher type cases”). The key question is whether the landowner has breached the duty of care that he had in relation to the tree. Thus, while the tree may have caused real damage it may be possible to keep the level damages down or to dismiss the claim altogether. Such cases may often involve trees fronting a highway.

 

TPO (Tree Preservation Order) prosecutions

Prosecutions for work carried out in breach of a Tree Preservation Order (known as “TPO”) brought under s.210(1) or s.210(4) of the Town and Country Planning Act 1980. Has the local authority got a valid TPO under which to prosecute the defendant? It is also a surprising fact that some species, despite being commonly thought of a “trees”, do not qualify under the Act as a protected tree. Are the local authority wrongly prosecuting under the more serious offence of the two offences under s.210(1) which carries a maximum £20,000 fine? It is also now possible that local authorities can pursue “Proceeds of Crime” applications against persons or companies (frequently developers) convicted. For example, if the value of properties has been increased because trees obstructing a nice view have been illegally felled, then the local authority may try and bring proceedings to seize this value. It is important to be clear at the outset as to what the possible ramifications may be.

 

High Hedges

There is a statutory code relating to High Hedges to be found in Part 8 of the Anti-Social Behaviour Act 2003 which enables local authorise to serve notices requiring work to be carried out.

 

Other issues arising where trees are protected

Issues may also arise in relation trees that are within Conservation Areas, Sites of Special Scientific Interest, on common land or where the tree (dead or living) is the habitat of rare species of bird, animals or insects.

Elections and changes of position in the Caribbean (Delta Petroleum v BVI Electricity Corp)

Author: James Saunders

Date: 20 Oct 2020

Dispute Resolution analysis: The Privy Council board in Delta Petroleum has considered the application of the doctrine of waiver by election and provided useful guidance on when the doctrine will apply in the performance of contracts. Furthermore, the board reviewed the inherent power of appellate courts to award restitution with interest, and the considerations that will apply to a change of position defence if raised by a public entity. 

Please click here to read the full article.

This analysis was first published on Lexis®PSL on 20 October 2020

Not My Brother’s Keeper – A Brief Guide to Inactive Directors’ Liabilities IT Protect Ltd (In Liquidation) [2020] EWHC 2473 (Ch)

Author: James Saunders

Date: 01 Oct 2020

This article examines issues raised by the recent decision in IT Protect Ltd (In Liquidation) and considers the challenges posed when seeking to impose liability upon wholly inactive directors. ?

Directors are, prima facie, jointly and severally liable for wrongs in which they are sufficiently involved. Those claiming damages or associated remedies can elect which director to pursue for satisfaction of any remedy granted. However, this is subject to the significant caveat that a director is not liable for the sins of their co-director solely by reason of their office, a claimant must plead and prove a sufficient basis in law for joint liability. ?

This gives rise to a range of difficulties, chief amongst which is how to fix a wholly disengaged director with liability. The point is particularly acute if the prospects of recovery and worthwhile execution differs significantly between directors. ?

 

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When is a case sufficiently arguable for Norwich Pharmacal relief? (Hickox v Dickinson)

Author: James Saunders

Date: 25 Sep 2020

Dispute Resolution analysis: Hickox concerned a claim for Norwich Pharmacal relief in connection with the misappropriation of an 1896 artwork of Paul Signac. The case provides a useful example of the boundaries of the jurisdiction and what must be demonstrated in order to make out the good arguable case needed to obtain an order. Whilst applicants can put forward broadly constructed cases with no requirement to commit to a particular cause of action, the need to demonstrate a good arguable case of wrongdoing generally does not prevent the court having regard to the underlying elements of the causes of action which are put forward. Finally, Hickox demonstrates the benefits of suggesting viable causes of action which do not require proof of knowledge or notice.

This analysis was first published on Lexis®PSL on 25/09/2020

 

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