Worldwide freezing injunction upheld
Wednesday 8th February 2017
In a recent decision the High Court of Justice has determined that a post-judgment worldwide freezing order should continue indefinitely until payment of the judgment or a further order is made (Touton Far East Pte Ltd v Shri Lal Mahal Ltd (formerly Shivnath Rai Harnarain (India) Ltd),  EWHC 1765 (Comm)).
The worldwide freezing injunction was granted in favour of the claimant, Touton Far East Private Limited against Shivnath Rai Harnarain Limited (‘SRH’), an Indian company in relation to a Grain and Feed Trade Association (GAFTA) arbitration award which was worth over $4 million.
SRH was originally given until March 2016 by the Court to apply to vary or discharge the order. SRH asked for an extension of time to appeal, and also argued that the freezing order should not be indefinite and suggested that an appropriate period of time would have been one month.
The Court refused SRH’s request for an extension and determined that the freezing order would remain in place until payment of the judgment debt or further order of the Court.
In concluding that the order should remain in place, the Court determined that the defendant was in a position to pay the judgment at any time (as it was clear that the defendant was a substantial company) and was therefore choosing not to pay the debt as opposed to being unable to pay. The Court also held that, if it was determined at a later date that the freezing order was being maintained by the claimant for an illegitimate purpose, the Court’s position could be reconsidered at that time.
Clearly, the Court in this instance was keen to ensure that the English judgment is given the opportunity to be enforced successfully and this case demonstrates the effectiveness of freezing injunctions even after an initial judgment has been obtained.
Author: Paul Connor
Interest Rate Swap Claims Update – Court hands down Judgment in Property Alliance Group Ltd v RBS
Thursday 12th January 2017
The High Court has now handed down the long-awaited judgment in Property Alliance Group Limited v The Royal Bank of Scotland PLC. The decision will be of particular interest to litigants pursuing or contemplating interest rate swap claims and also London Interbank Offered Rate (LIBOR) claims.
The Claimant is a property investment and development business and the Defendant provided them with commercial banking services. That included 4 interest rate swap products, entered into between 2004 and 2008.
In summary, the Claimant claimed that the swaps were mis-sold; that the bank moving them to their Global Restructuring Group (together with their management within the group) was a breach of contract; and that the swaps should be rescinded and/or that they should be awarded damages because of the bank’s alleged participation and knowledge of the manipulation of LIBOR rates.
Following a 38 day trial before Aspin J, Judgment has now been handed down and the Court has dismissed all three parts of the claim.
The Judgment includes important findings regarding the extent of the duty of care owed by the bank. In selling interest rate products the banks owed a duty to take reasonable care not to mis-state the facts. In this case the Claimant argued that the duty of the bank here was wider than that, and included a duty to fully, properly and accurately explain the transactions. The Judge held that any duty to advise had been expressly excluded in the terms of the contract between the parties.
The Judge also said that whether the duty of care is wider than a duty not to misstate the facts, is dependent on the facts of each case and that, where the bank was acting outside of an advisory relationship, she was not bound by previous authorities to find that there was a wider duty to “explain fully the products”. The Court also found that in this case there was no implied contract term of good faith or duty on the bank not to withhold important information.
The Judgment is also bad news for Claimants bringing claims related to alleged LIBOR mis-selling as the Judge found that here the offering of swaps that were referable to LIBOR rates was not in itself sufficient to give rise to implied representations regarding the setting of those LIBOR rates.
The Claimant has said that it is assessing the basis for an appeal.
Author: Glyn Lancefield
Cuba Offers Rum in Payment of US$276 Million Debt
Friday 16th December 2016
Parties to disputes often discuss creative terms of settlement but one of the more unusual is the offer by Cuba to pay off its debt to the Czech Republic, with rum.
The debt arises from the Cold-War era when both countries were in the communist bloc, and amounts to US$276 Million, the equivalent of £222 Million. The Czech Republic imports rum from Cuba and according to the Czech finance minister the Cuban authorities have offered to make payment of the outstanding debt by supplying rum to the country.
It has been reported that the Czechs would still prefer payment, at least partly, in cash.
The opportunity to propose different forms of payment is one of the attractions to parties of using alternative means of dispute resolution than the Courts. Where a Judge can order a payment of damages in cash, alternative dispute resolution (ADR), such as mediation or a joint settlement meeting, enables the parties to discuss more creative forms of payment.
For example in disputes between businesses a settlement may be agreed whereby one party provides services to the other to the value of the settlement sum. Sometimes that will not be appropriate where the business relationship has broken down, but assuming that the parties are prepared to deal with each other in future this sort of settlement can have cash-flow advantages for the ‘paying’ party.
A transfer of goods can also be offered as a form of payment, and if the Cuban offer is accepted the rum-drinkers of the Czech Republic will be very pleased with those settlement terms.
Author: Glyn Lancefield
STAR LAWS - Probate implications of Star Wars Episode VII: The Force Awakens
Thursday 15th December 2016
To celebrate the coincidence of the release of the new Star Wars Film, Rogue One, and the launch of our new contentious probate website, www.willsandprobateclaims.brabners.com, we have considered the probate implications of Star Wars Episode VII: The Force Awakens.
As we are going to be discussing events after death obviously you should not read on if you have not seen (but plan to see) The Force Awakens.
For the purposes of this exercise we have assumed that the law of England and Wales will apply in a galaxy far, far away.
[SPOILER ALERT - IF YOU HAVENT SEEN THE FORCE AWAKENS BY NOW DO NOT SCROLL PAST THE WOOKIE!]
To our great disappointment The Force Awakens concluded with Han Solo being murdered by his estranged son and unceremoniously fell off a bridge.
Han was not married and, as far as we are aware, not co-habiting with anyone for any length of time. The life of an intergalactic smuggler is probably inconsistent with that. This rules out claims from a spouse or cohabitee to a reasonable financial provision from his estate under the Inheritance Act (Provision for Family and Dependants) Act 1975. We should not discount the possibility that there may be unknown dependants.
As far as we are aware Han held no joint bank accounts or any jointly owned property which would pass automatically to any joint owner by way of survivorship.
We suspect that Han’s only real asset will be the Millennium Falcon.
Han may have made a will and, if so, the assets in the estate would pass according to the specific gifts and legacies in that will. As Han was murdered by his son his son will not be permitted to benefit from the estate whether there is a will or not. We do hope that Han did make a will and left the Millennium Falcon to Chewbacca.
If Han did not make a will there are potentially alarming consequences. As there is no other known family member then the conclusion must be that the Millennium Falcon and any other assets will be treated as what is known as ‘Bona Vacantia’ and will pass to the Crown estate.
For a more practical information on the real world application of these principles and for further information please visit www.willsandprobateclaims.brabners.com
Author: Simon Morris
A step closer to defining the term ‘client’ for Legal Advice Privilege?
Wednesday 14th December 2016
In the recent case of RBS Rights Issue Litigation  EWHC 3161 (Ch), at an interlocutory hearing, Mr Justice Hildyard was asked to consider RBS’s claim to privilege in relation to transcripts, attendance notes and other records of interviews conducted with employees and ex-employees.
The Judge in his ruling applied a narrow interpretation of who is a client for legal advice privilege purposes, as a client will consist only of those employees authorised to seek and receive legal advice from their lawyer. Furthermore, legal advice privilege does not extend to information provided by employees and ex-employees to or for the purposes of being placed before a lawyer. This reasoning was following the Court of Appeal’s decision in Three Rivers District Council and others v Governor and Company of the Bank of England (No 5)  QB 1556, a judgment that has been the subject of much criticism for not sufficiently clarifying who is a lawyer’s ‘client’ for the purposes of legal advice privilege. Hildyard J himself alluded to such criticism by stating ‘there is, to my mind, force in these criticisms and attempts to confine the application of the decision in Three Rivers (No 5).’
In CITIC Pacific Limited v Secretary for Justice and Commissioner of Police (unrep, 29/06/2015, CACV 7/2012), the Hong Kong Court of Appeal rejected the approach to legal advice privilege as established by Three Rivers (No5). Instead the Court adopted a broader test, which was based on deducing what is the dominant purpose of the document or communication. This test is more akin to the test that applies to litigation privilege, which appears more sensible, as it focuses on the substance rather than the form. Such an approach would also avoid the need for corporate clients to abide by unnecessary formalities in an attempt to obtain the protection of privilege for documents produced as part of the process of obtaining legal advice.
In the light of all these criticisms RBS has indicated that it will seek permission to appeal the decision. There is now hope that the Supreme Court will have the much awaited opportunity to revisit the law on privilege and answer the fundamental question as to whether the distinction between legal advice and litigation privilege is really appropriate.
Author: Joshua Oxley
Challenging Mental Capacity – a High Hurdle
Thursday 8th December 2016
In the recent case of Poole v Everall [2016[ EWHC 2021 (Ch) the Court has demonstrated just how difficult it can be to evidence that a will was not validly executed because the testator did not understand the nature and quality of their actions.
In this case, the testator, Mr Poole, had a history of mental health issues. During his life he was cared for by Mr Everall.
In December 2012 Mr Poole executed a will which left 95% of his estate to Mr Everall.
Previously in February 2012 Mr Poole gave instructions to prepare a will that left nothing to Mr Everall and his solicitor recorded instructions from Mr Poole that he felt bullied by Mr Everall. That will was never signed but was amended in draft to reflect Mr Poole’s later instruction to his solicitors to reflect a legacy of 5% of Mr Pool’s estate to Mr Everall.
Following his death in April 2013 Mr Poole’s 2 brothers challenged the December 2012 will for a variety of reasons including that Mr Poole lacked capacity to execute that will.
The Court concluded that Mr Poole was suggestible and vulnerable. However, Mr Poole had been formally assessed by his solicitor and his doctor in February 2012 and both believed he had capacity to give instructions to prepare a will and to understand the effect of executing it.
In circumstances where there has been a contemporaneous professional assessment of the testator concluding that they do have capacity the threshold to be satisfied to successfully challenge a will for that reason is very high.
Author: Simon Morris
Coming to a city near you? The hidden cost for employers who provide workplace parking
Thursday 24th November 2016
The Workplace Parking Levy is a charge on employers who provide workplace parking. Nottingham is the only city to have implemented the Levy which collected £9.3 million for 2015/16, £9.1 million in 2015, £8.4 million in 2014 and £7.8 million in 2013. Other local authorities have rejected proposals to introduce their own levies, fearing criticism from local businesses or discouraging future investment. Cambridgeshire and Oxfordshire County Councils are currently considering implementing a levy similar to that in Nottingham. The money generated by the scheme in Nottingham is being used to fund the public transport network.
The law and to whom it applies
In Nottingham, the Levy is given effect by:
- Sections.178-200 Transport Act 2000
- The City of Nottingham Workplace Parking Levy Order 2008
- The Workplace Parking Levy (England) Regulations 2009 (SI 2009/2085)
It is employers, as opposed to employees, who are responsible for paying the Levy, however, with the requisite knowledge and planning, employers can reclaim part of the charge from their employees. All employers or associated employers (subsidiary and parent companies) who provide workplace parking places to; employees, regular business visitors, students or pupils are legally obliged to consider the need to obtain licences for workplace parking places and may be liable to pay.
There are several exemptions to the Levy pursuant to the legislation. However, in terms of employee parking, in the most part, the employer will be obliged to pay the charge. Employers who provide parking to 10 or fewer employees are required to obtain licences, but receive a 100% discount.
This is potentially substantial.
In Nottingham, for the licensing period of 1 April 2016 to 31 March 2017, the charge is £379 per place, per year. VAT is not payable on the Levy however, if the employer introduces parking charges for its employees to pass on this cost, this would be subject to VAT. Another alternative is to introduce a salary sacrifice scheme. This allows an employee to sacrifice part of their salary for a tax exempt benefit in the form of workplace parking. This would save the employee tax and NIC.
Penalties and enforcement
There are 3 possible civil contraventions:
- Failure to have a licence.
- Failure to have a licence for all workplace parking places being provided.
- Breach of licence conditions.
If an employer commits one of the contraventions above, they will be notified by the local authority and given a chance to remedy this. Continued non-compliance can result in Penalty Charge Notices. For contraventions 1 and 2, the Penalty Charge will be 50% of the annual charge per unlicensed parking space for each day contravention occurs. If unpaid, the local authority could commence County Court proceedings.
Whilst not yet imposed outside of Nottingham, the number of cities utilising the Levy is likely to increase.
Author: Matthew Ross
Doctors’ privacy rights – should the General Medical Council disclose information to patients?
Wednesday 23rd November 2016
In the recent case of Dr DB v GMC, a doctor successfully challenged a decision of the GMC to disclose an expert report, relating to the doctor’s fitness to practise, to a patient.
The case arises following a missed diagnosis of bladder cancer. The GMC investigated DB’s fitness to practise and instructed an independent expert to review the concerns. In the report, the expert had concluded that Dr DB’s care had ‘fallen below, but not seriously below, the expected standard’. The GMC therefore decided that no further action was to be taken against Dr DB.
However, having received a summary of the expert’s report, the patient requested a full copy as they intended to consider a possible claim in negligence. DB did not consent to the disclosure of the report, however, the GMC decided that it should be disclosed to the patient. Dr DB then brought proceedings in order to prevent disclosure.
When considering personal data held by others, the relevant law is set out in the Data Protection Act 1998 (‘the DPA’).
Under section 7(1) DPA, the patient is considered as a “data subject” and is therefore provided the right to access their personal data. However, in this particular case, the report contained not only personal data relating to the patient, but to Dr DB also.
In such circumstances, the DPA provides that a balancing exercise must be carried out. The GMC are to bear in mind any duty of confidentiality and the fact that Dr DB expressly refused to consent to the disclosure of the report. The fall-back position is that where consent has not been given, there is a rebuttable presumption against disclosure (Durant v FSA).
In favouring to disclose the report, the GMC considered the following:-
- The sensitive nature of the patient’s medical records;
- The conclusions made on Dr DB’s standard of care;
- The independence of the reporting expert;
- The GMC’s legitimate interest in fairness and transparency;
- The patient’s legitimate interest in seeing the report;
- Dr DB’s reputation;
- The lack of evidence to suggest that the patient would misuse the data in the report.
In response to this, Dr DB highlighted the following:-
- That he had an unblemished disciplinary history of over 25 years’ practise;
- His concerns that the patient may publish the report online;
- The absence of his own comments within the report;
- His expectation that the report would be kept confidential following the decision to take no further action.
Mr Justice Soole held that the balancing exercise conducted by the GMC had been done incorrectly and that therefore the report should not be disclosed to the patient.
Mr Justice Soole agreed that the starting point should have been a presumption against disclosure, that the GMC had attached undue importance to transparency and equality of treatment and also, that the GMC had failed to consider that the purpose of the initial request for the report was for the intended litigation against Dr DB. This was held to be a significant factor in favour of refusal on the basis that the more appropriate forum is the court procedure for disclosure within the Civil Procedure Rules.
This case highlights that there is a balancing exercise to be conducted when considering the disclosure of such information, however, once consent to disclosure has been refused, difficulties may arise in overcoming this.
Author: Faye Bolger
New guidelines for crimes committed using social media
Friday 11th November 2016
The Crown Prosecution Service (CPS) has recently issued new “Guidelines on prosecution cases involving communications sent via social media” (the Guidelines), which are set to have immediate effect.
The Guidelines have been provided in order to assist prosecutors in recognising criminal behaviour committed online. They will deal with a wide variety of acts which are considered to be acts of virtual harassment and/or online bullying.
Offending under the Guidelines is broken down into four categories (and there are also additional sections on other classes of offending):-
Category 1 - Communications which may or could constitute threats of violence to the person or damage to property.
Category 2 – Communications which specifically target an individual and which may constitute a number of offences. This also included the recently formed offences of “controlling or coercive behaviour”, as well as “disclosing private sexual images without consent”.
Category 2 offences also include cases of what is known as “sexting”. This is identified as the exchange of sexual messages or images and the creation, sharing and forwarding of sexually suggestive nude or nearly nude images through mobile phones and the internet.
Category 3 – Communications that could amount to a breach of a court order or a statutory prohibition.
Category 4 – Communications which do not fall into any of the categories above and are those which are considered “grossly offensive, indecent, obscene or false”.
Charges will be brought under Section 1 of the Malicious Communications Act 1988 or Section 127 of the Communications Act 2003. It is important to note that under either stature, the offence is committed by merely the sending of the communication.
The prosecution of offences deemed to be within Categories 1, 2 and 3 are likely to fall within the scope of the public interest. However, cases within category 4 “will be subject to a high evidential threshold and in many cases, a prosecution is unlikely to be in the public interest”. Category 4 prosecutions are only likely to be suitable where the communication is more than:-
1. “offensive, shocking or disturbing”;
2. “satirical, iconoclastic or rude comment”; or
3. “the expression of unpopular or unfashionable opinion about serious or trivial matters, or banter or humour, even if distasteful to some or painful to those subjected to it”.
The new guidelines will require careful consideration of the applicability of freedom of speech under Article 10 of the European Convention on Human Rights (ECHR).
Article 10 provides that “Everyone has the right to freedom of expression. This right shall include the freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers”.
However, the ECHR have previously determined that the rights provided within Article 10 are not absolute. The case of Sunday Times v UK (No 2) Goodwin v UK  22 EHRR 123 confirmed exceptions to these rights can occur where restrictions are both necessary and proportionate.
Author: Faye Bolger
What is "Revenge Pornography" from a legal standpoint
Wednesday 9th November 2016
Section 33 of the Criminal Justice and Courts Act 2015, which came into force on 13th April 2015, created the offence of ‘disclosing private sexual photographs and films with the intent to cause distress’; what is more commonly known as ‘revenge pornography’. Broadly, revenge pornography means an individual, often a past boyfriend/girlfriend or sexual partner, uploading intimate sexual images or videos of the victim on to the internet without their consent and in order to cause them distress/humiliation/embarrassment.
Section 34 of the CJCA provides definition of “disclose” and “photograph or film”. Disclose simply means the act of, by any means, giving, showing or making the photograph/film available to another person. In terms of the material itself the offence only applies to material which looks photographic and which originates from an original photo or film recording.
S 35 of the same provides the definitions of ‘private and ‘sexual’. A photograph or film is “private” if it shows something that is not of a kind ordinarily seen in public. S 35 (3) makes it clear that the law doesn’t only cover explicit material, but also anything ‘that a reasonable person would consider sexual’. For example, sharing a picture of someone posing in a provocative manner without their consent and in order to cause them distress would be an offence under s 33 of the CJCA as long as a reasonable person would consider the picture sexual in nature.
Anyone who shares or forwards a private sexual photo or film that has been placed on the internet, without the individual’s consent, is also committing a so called ‘revenge pornography’ offence if one of the purposes of doing so was in order to distress the individual depicted. The Crown Prosecution Guidelines make it clear that anyone forwarding the image/video for another reason i.e they thought it was amusing, would not be committing an offence under s 33 of the CJCA 2015.
There are a number of defences set out within the statute. It is not an offence to disclose a sexual photo/film to the individual depicted within the images or to disclose it with the reasonable believe that the disclosure was necessary for the purposes of preventing, detecting or investigating crime. It is also a defence to show that the disclosure was made in the course of, or with a view to, the publication of journalistic material which the individual reasonably believed was in the public interest or that the material had previously been disclosed for reward and there was no reason to believe this was done without consent. The Prosecution must also prove that the intention to cause distress was present-it is not enough that this was a natural and probable consequence of the disclosure.
Since 13 April 2015 over 200 people have been prosecuted under s 33 of the CJCA. The offence of ‘revenge pornography’ is triable either way meaning that it can be tried in either the Magistrates or Crown Court. The maximum sentence is 12 months and a fine when tried in the Magistrates Court and 2 years' imprisonment or a fine in the Crown Court.
Author: Chloe Jackson