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A B C D E F G H I J K L M N O P R S T V W Y

Dispute Resolution

Service by email: are you being served?
Tuesday 23rd January 2018

Glencore Agriculture B.V. (formerly Glencore Grain B.V.) -v- Conqueror Holdings Limited [2017] EWHC 2893 (Comm)

Introduction

In this case, the High Court considered whether a notice of arbitration was validly served on a party when it was sent to an individual employee’s email address.

Section 76 of the Arbitration Act 1996 (“the Act”) provides that parties are free to agree the manner of service of the notice of arbitration but, failing that, the notice may be served "by any effective means".

This, of course, is a far wider concept than that prescribed under the CPR in which prior consent to serve documents (including a claim form) by electronic means is required for service to be effective.

Factual Background

A dispute arose between the parties in relation to the delay caused whilst Conqueror’s chartered vessel was at a loading port. Mr Oosterman of Glencore had advised Conqeuror that the vessel would remain at anchorage.

A letter before action was sent to Mr Oosterman’s email address, followed by further correspondence and a notice of arbitration. All communications were sent by email to Mr Oosterman’s email address, there was no response to any of them. The first time that Glencore became aware of the arbitration proceedings was when it received, by post, the arbitration award issued in favour of Conqueror in the sum of $43,176.27.

It transpired that Mr Oosterman was a relatively low-level employee at Glencore who had in fact left its employ before the purported service of the notice of arbitration.

Glencore’s application to set aside was upheld on the basis that it had taken no part in the proceedings simply because it was had been unaware of them. Popplewell J commented whether service by email to an individual’s email address constitutes good service “must depend upon the particular role which the named individual plays or is held out as playing within the organisation".

Comment

Care should be taken when serving arbitration notices (or any documents for that matter) by email. Under the Act, there is no requirement for parties to confirm that they are prepared to accept service by email.

There was found to be a distinction between instances of:

  1.  serving documents at a company’s generic email address “info@company.com” where the sender can reasonably expect the person who opens the email to be authorised internally to deal with its contents. In Bernuth Lines v High Seas, service to a generic company email address was found to be valid service; and
  1. serving documents at an individual employee’s email address with no knowledge of whether the individual in question had authority, whether express, implied or ostensible, to accept service of legal proceedings.


Companies who do operate a generic email address may be well advised to ensure that the employee who operates that account is suitably briefed to ensure that the appropriate response is taken if proceedings or correspondence are sent to that address.

This decision highlights two crucial points about the service of arbitration proceedings by email:

  1. Check that the email address being used is the appropriate address; and
  1. Ensure that the recipient is a properly authorised person to accept service

 


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A new approach to the disclosure of documents?
Wednesday 3rd January 2018

New rules on disclosure are to be piloted this year with the aim of moving towards a more considered approach to the disclosure exercise that is more cost effective for the parties and more tailored to how documents are stored using modern technology.

The disclosure of documents is often one of the most important but also costly stages in commercial litigation.  The usual case management direction for disclosure has been ‘standard’ disclosure, which is described in Part 31.6 of the Civil Procedure Rules (CPR) as requiring a party to disclose:-

(a)   the documents on which he relies; and

(b)   the documents which –

(i)             adversely affect his own case;

(ii)            adversely affect another party’s case; or

(iii)           support another party’s case; and

(c)   the documents which he is required to disclose by a relevant practice direction.

The 2013 reforms to civil litigation provided a ‘menu’ of disclosure options which are set out in CPR 31.5(7).  These included ‘standard’ disclosure but also other options such as disclosure on an ‘issue by issue’ basis or a direction that each party disclose any documents which it is reasonable to suppose may contain information which enables that party to advance its own case or to damage that of any other party, or which leads to an enquiry which has either of those consequences.  However these other options have not been widely used and the usual order remains for ‘standard’ disclosure.

Parties to litigation are often frustrated by how a direction of ‘standard’ disclosure can be used by an opponent to demand that a wide search for documents be undertaken at often disproportionate expense, or to disclose a large volume of documents that are mostly irrelevant to issues in dispute.

Last November a Working Group launched a consultation exercise on further reforms to the disclosure rules, with a plan to then pilot reforms over a two-year period in the Business and Property Courts in the Rolls Building and in centres across the country, including Liverpool and Manchester.

The key proposed changes are as follows:-

·         The parties are to give ‘Basic Disclosure’ with their statements of case.  The proposals anticipate that a search should not be required for such documents, and that Basic Disclosure will mean key documents which a party relies on and which are necessary for their opponent to understand the case.

·         Before the first Case Management Conference the parties are to discuss and jointly prepare a ‘Disclosure Review Document’ to list the main issues in the case, to share information about how documents are stored and how they may be searched and reviewed, and to propose directions for ‘Extended Disclosure’.

·         Five models of Extended Disclosure are proposed, being:-

  1. Model A: no disclosure.
  2. Model B: limited disclosure.
  3. Model C: request-led search-based disclosure.
  4. Model D: narrow search-based disclosure, with or without narrative documents.
  5. Model E: wide searched-based disclosure.  The draft Practice Direction states that this model is “only to be ordered in an exceptional case”.

·         The parties are to be required to give a cost estimate for disclosure before the Case Management Conference, but to complete their cost budget for disclosure after a disclosure order has been made by the Court.

·         Businesses should also note that new rules are proposed regarding the preservation of documents, including an express obligation to suspend relevant document destruction processes for the duration of the claim, and to send a written notification to all relevant employees that they must not delete or destroy documents that may be relevant to the claim and should take reasonable steps to preserve such documents.  That latter obligation extends to agents or third parties who may hold documents on the party’s behalf.

Consultation on the proposed reforms is open until 28 February 2018.  The responses will then be reviewed by the Civil Justice Rule Committee, following which the new disclosure scheme will be piloted.  Litigants will hope that, if implemented, the new rules will bring about real reform in this area of litigation.


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Air Rifles - A Cautionary Tale…
Tuesday 12th December 2017

Mr Haroon Javed was arrested in early 2015 upon his return from a holiday in Pakistan.  On his outbound journey to Pakistan some weeks earlier he had been stopped by police officers and had seized from him two Edgun air rifles along with a range of other related equipment.  The rifles had been declared to the airline prior to arrival at the airport and prior to travelling Mr Javed had depressurised the air reservoirs on both rifles and removed the hammer springs from both weapons.  When he arrived at the airport he presented them for examination to UKBF and the guns were cleared and accepted for loading into the aeroplane.  In a separate bag along with other items, was a jiffy type bag containing some screws, washers, and some hammer springs although he did not have the spring’s original to the rifles with him.

Whilst Mr Javed had been visiting his family’s farm in Pakistan, the UK authorities instructed an expert to test the rifles.  The expert concluded that both rifles should be defined in law as firearms subject to section 1 certification since both weapons operated at well above the permitted UK limit of 12ft/lb muzzle velocity.  Since Mr Javed did not have a firearms certificate authorising possession of the rifles he was interviewed by the police and, despite making his position clear in interview, was prosecuted for two counts of possession of a firearm without a certificate and for two counts of possession of a firearm and ammunition in a public place.

Lachlan Nisbet, BASC’s Solicitor for England & Wales instructed Matthew Perring of BASC’s firearms team to inspect the weapons and to prepare expert evidence.  It was conceded by the prosecution expert that the rifles were both inoperable in the condition that he had received them in – both having no hammer springs fitted.  In his report to the Court, Mr Kabbani from Key Forensics who provided expert evidence to the Crown report set out that he had selected a pair of hammer springs from the jiffy bag referred to above and fitted them to the rifles causing them to operate.  However, Mr Kabbani failed to set out which springs (of the three sets present) he had fitted and why he had selected those springs.  He also did not say whether any of the other springs, if any, would have fitted either of the weapons and, had they fitted, what the weapons’ kinetic capability might have then been.  Mr Kabbani treated the air rifle and the various screws, washers and springs as if they were capable of being defined as section 1 component parts in their own right.

Probably the most alarming aspect of this case however was the idea that is was acceptable for an expert examiner to interfere with exhibits i.e. fitting the hammer springs in such a way as to create a potential offence.  As the guns were received by the expert, they were inoperable.  Their legal status at that time was little more than two pieces of wood and metal.  It also seems difficult to understand how the matter was deemed suitable to prosecute, there was after all no evidence that anything other than the manufacturers supplied hammer springs had ever been fitted to these weapons whilst they were in the UK.  Mr Javed’s case was eventually listed for trial and the Crown offered no evidence on the day of trial.

Regrettably, because this case was something outside of the ‘norm’ for criminal cases, the passage of the matter through the Court system was difficult.  The case was listed for trial on no fewer than 4 occasions and on two of the previous occasions that Court had been unable to provide sufficient Court time for the matter to proceed.  These delays are common in privately funded cases because they are usually non-custody cases and so generally where resources are tight, cases where defendants are in prison tend to be prioritised.  This all results in a significant increase in costs to the privately paying defendant. 

Through his membership to BASC Mr Javed was entitled to assistance of the Association’s firearms team who provided expert evidence including the provision of the reports and supplementary reports and the expert’s time in attending Court – all without charge.  Mr Javed’s membership of BASC also meant that his membership legal expenses insurance responded to pay all of his legal fees including Counsels’ fees. 


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The Boundary Disputes Protocol – a cheaper, faster, friendlier option.
Tuesday 12th December 2017

The Property Litigation Association has recently published The Boundary Disputes Protocol (the Protocol) with the aim of facilitating the swift resolution of neighbour disputes while keeping costs to a minimum.

As you might expect, boundary disputes can be very stressful for those involved. On the one hand people are proud of their homes and do not wish to lose valuable parts of what they consider to be their land. On the other, a feud between you and your neighbour will inevitably lead to a hostile and stressful home environment.

The Protocol is not binding nor does it form part of the Civil Procedural Rules (CPR). It is therefore up to the neighbours in dispute to agree to abide by it.

The Protocol provides guidance in the following areas:

Preliminary Issues – The parties should not interfere with any physical feature, or with any land which the other party claims to be theirs.

Exchange of Information – The Protocol sets out the time frames in which information should be exchanged with either side.

Appointment of professional advisors / Negotiation – The Protocol acknowledges that there may be some instances in which professional advice should be sought e.g. where there may be a claim for adverse possession.

Expert – The Protocol considers the circumstances in which it may be necessary to appoint an expert such as a surveyor in order to help identify the exact boundary line.

Adverse Possession – The Protocol provides some advice and guidance in the event that either party considers that there may be a claim for adverse possession.

Dispute Resolution – The Protocol sets out the possible alternative dispute resolution options available to the parties as well as the “final step” option of referring the dispute to the appropriate tribunal.

Agreement – The Protocol provides guidance on the precautions both parties should take in reaching an agreement. The parties should be clear on what they are agreeing to and once finalised, a written agreement (which may be drawn up by a lawyer) should be signed and have the agreed plan annexed to it.

The Protocol also provides a Guidance Note and Supplementary Guidance Note which expands on the main principles.

It is clear that the Protocol provides a fair and structured approach for neighbours in dispute to adopt. The result of which is a streamlined and cost effective method of resolving what may otherwise be a more costly, protracted and stressful dispute.

If you find yourself facing a boundary dispute with a neighbour please do not hesitate to contact a member of our Dispute Resolution Team who will be able to provide further advice.  


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Solicitor Negligence Claims Update
Monday 23rd October 2017

A recent Court of Appeal judgment has found that a firm of solicitors were not negligent in failing to challenge a client’s decision not to pursue a particular part of their claim.

In 2001 Mr. Graham Thomas decided to a claim for vibration white finger (VWF), a mining related condition, and he instructed solicitors to pursue the claim through a scheme set up dealing with VWF claims.  Under the scheme Claimants had a medical examination and then the option to accept an offer for general damages, or to pursue a claim for special damages (i.e. damages for economic losses such as the cost of medical treatment and domestic assistance).

Mr. Thomas underwent a medical examination and then received an offer of general damages.  He met with his solicitor, who explained the scheme in general terms and later sent a letter to him explaining what a claim for special damages would involve.  There was then a second meeting between Mr. Thomas and his solicitor which included a discussion about the process of pursuing a claim for special damages.  At that point Mr. Thomas decided to accept the offer of settlement for general damages.

In 2008 Mr. Thomas instructed another firm of solicitors who commenced a professional negligence claim against the previous firm of solicitors, arguing that the solicitors had failed in their duty to Mr. Thomas by not challenging his decision not to pursue a claim for special damages.  The Judge dismissed the claim and Mr. Thomas was granted permission to appeal.

In September the Court of Appeal dismissed the appeal, and in doing so made the following findings regarding solicitor negligence claims:-

  • The duty of solicitors to advise is fact-specific and may vary with the circumstances of the particular client.  Here the solicitor had met with the client twice face-to-face and he was able to make an independent decision.  The Court held that it was not the duty of the solicitor to tempt him to change his mind.
  • The extent of recoverable costs is relevant to a litigation solicitor’s standard of care.  The VWF scheme applied a fixed costs regime.

The decision is therefore of relevance to Claimants in litigation by demonstrating the importance of taking into account all heads of claim when considering settlement, and also to the parties in solicitor negligence claims regarding the issue of the extent of the standard of care.

The dispute resolution team at Brabners has wide experience of pursuing solicitor negligence claims, and runs the specialist website at www.solicitorsnegligence.co.uk


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Mental Capacity to make a will and mistaken beliefs
Wednesday 11th October 2017

For a will to be valid certain tests must be satisfied.  One of the more obvious tests is whether the individual making the will (known as the testator) has the mental capacity to understand the effect of making a will, the property they are disposing of and to comprehend and appreciate the claims to which they should give effect. 

The important final element of that test is that the testator should not have any disorder of the mind that perverts their sense of right or prevents the exercise of their natural faculties.

An interesting strain of case law has developed around whether a mistaken belief held by the testator can render a will invalid.  There are obviously cases where this will be the case such as demonstrable insanity or memory loss but there are many cases where things are less clear cut.

For example, in the case of Re Bellis [1992] 141 LT 245 the testator made a will from which one of her 2 daughters benefitted more than the other.  The will was successfully challenged on the basis that the testator was mistakenly under the impression that she had been supporting one of her daughters and wanted to redress the balance by her will.  As the support the testator mistakenly considered she had been providing had not been provided the will was set aside.  It is not enough that that there is a mistake made by the testator as to the facts, the mistake has to be relevant to the manner in which the will is prepared and the exercise of the testamentary capacity.

One recent case on this issue is Ball & ors v Ball & Ors [2017] EWCH 1750 (Ch).  In this case 3 children sought to challenge their mother’s will on the basis she lacked capacity due to a mistaken belief.

The facts of the case are that the 3 children has reported their father to the police for sexual abuse and their father had been prosecuted and pleaded guilty to some of the charges.  The mother’s will was made following those events and she was evidently upset by her children’s actions and she excluded them from her will in favour of her other children.

The essence of the case was whether the mother had been misled by her husband as to certain facts.  In reaching his very fact dependent judgment His Honour Judge Matthew did not accept that the mother has been misled and that, when she made her will, she was “not labouring under any significant mistake at all as to the guilt of her husband”.  On that basis, the will was valid and the challenge to it failed.

Of course there are other grounds on which wills may be challenged which may overlap with issues of testamentary capacity – such as where a mistaken belief on the part of the testator is the result of a third party providing false information to the testator either negligently or deliberately.  If deliberate and the third party then becomes a beneficiary under a testator’s will that might give rise to a challenge in undue influence.

For more information on wills, please click here


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Sports disputes - is arbitration a winning formula?
Tuesday 3rd October 2017

It was 2008 and Usain Bolt leapt onto our screens along with three other Jamaican teammates to clinch not only a gold medal but also a world record in the 4x100m relay with an impressive time of 37.10 seconds.

Fast forward almost 10 years and Bolt’s unblemished record of gaining three gold medals (in three different events) at three consecutive Olympic Games has been ruined. Bolt’s teammate, Nester Carter, tested positive last year for a banned stimulant, methylhexaneamine, in a re-analysis of a urine sample from the Beijing 2008 games which has resulted in a disqualification of the 2008 4x100m victory, by the International Olympic Committee.

Legal representatives for Carter confirmed that he would appeal the decision to the Court of Arbitration for Sport (“CAS”) with a hearing scheduled for November this year. CAS is a an independent institution based in Lausanne, Switzerland in which all disputes in connection with the Olympic Games must be submitted, pursuant to rule 61 of the Olympic Charter.

Arbitration has always had its position in resolving disputes within the sports sector. It is often the favoured method of dispute resolution not least due to sports disputes often being extremely technical and requiring expert knowledge within the relevant field. Arbitration also offers an enviable element of confidentiality which litigation is not able to provide. This can be of paramount importance to sports stars, particularly athletes who are reliant on endorsements to make up the bulk of their earnings.

Whilst neither arbitration nor litigation can compete with Bolt’s lightning fast pace, arbitration does offer a more streamlined and efficient path to obtaining a determination of the dispute. Naturally, this is likely to result in a more cost-effective outcome which all parties should favour. Additionally, athletes have a limited period in which they can compete at the top of their game, therefore a lengthy bout of litigation could be a knockout blow to their careers.

With sport being a truly global phenomenon, ordinary litigation would struggle to provide the necessary arena for events taking place in varying locations. Further, a strict application of national law would fail to take account of the specific needs of the sporting world.

The benefits of arbitration over litigation apply not only in relation to disputes in the sports sector; arbitration can also be of great benefit in any commercial dispute which requires technical expertise, a more streamlined process and where the issues are of a sensitive nature.

If arbitration or litigation could assist you, or your company in resolving a dispute please contact a member of the Dispute Resolution Team.


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Hot Gossip - Single publication libel sufficient to secure £20,000 damages
Thursday 28th September 2017

In recent years, defamation lawyers have watched closely for court decisions that grapple with the new concept introduced by the Defamation Act 2013, namely the requirement to show that they have suffered “serious harm” before any valid complaint of libel can be made.

In the very recent case of Singh v Weayou [2017] EWHC 2102 the court considered a single email sent by a hospital employee to a senior manager and the HR manager making allegations of inappropriate sexual harassment against a fellow worker, the claimant.

Following a trial, the court found the allegations to be false and awarded £20,000 in damages to the Claimant.

In addressing the requirement to establish that the single email, sent to only 2 recipients, had caused the claimant ‘substantial harm’, the judge said “I accept that the hospital is a small and close-knit working environment where gossip is likely.” 


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Yet further court closures are expected
Wednesday 27th September 2017

Despite significant increases in the court fees payable in relation to most civil claims in recent years and a programme for the closure of 86 courts in England and Wales, it seems that even further court closures may be on the cards.

On 14th September 2017 the Lord Chief Justice, Lord Thomas of Cwmgiedd, gave evidence to the Justice Select Committee in relation to his annual report for 2017.[1]

In that report, the Lord Chief Justice said that:

There is a surplus in the HMCTS estate which needs to be addressed. This will inevitably involve further court closures which, under the terms of the HMCTS governance arrangements, are decisions for the Lord Chancellor. It will be essential to use the remaining estate more flexibly and efficiently.

The Lord Chief Justice further elaborated upon this issue when he gave his evidence to the Committee. He acknowledged that in circumstances where a town or city has multiple court or tribunal buildings already then some streamlining of these so that buildings and facilities are used more cost-effectively would not be controversial. However, the much more politically controversial issue is where there are court closures resulting in a town or city losing its court completely. He said that “it is a question of how radical are we prepared to be in providing a much better service or do we spend the money on maintaining buildings which are under-utilised”.

It remains to be seen how far reaching any such further closures may be (or if, indeed, they will happen at all) but it is certainly something that we will be watching with interest. Whilst increased efficiency in the court system is to be welcomed, especially in terms of reducing the amount of time taken for processing claims, the obvious concern is whether the loss of some local courts may make it more difficult for certain people to have their cases heard and get access to justice.   

 


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Debt claims are changing – for better or for worse?
Monday 18th September 2017

Back in May, we wrote about the new Pre-Action Protocol for Debt Claims (“the Protocol”) and considered the impact that it will have on both business creditors and consumer debtors. As the Protocol comes into force on 1 October 2017, there are now less than 2 weeks remaining to prepare for the changes afoot.

Protection for consumers

It is clear that the protection of consumers was a major consideration in the drafting of the Protocol. The new rules provide for individual debtors to be given, at the outset of the dispute, all of the information that they would need to fully understand and respond to the claim being brought against them. Creditors will also have to provide debtors with various standard form documents to assist the debtor in responding to the claim, and debtors will have ample time (without having to worry about proceedings being issued against them) to consider those documents and information before having to take any action to respond to the creditor.

Problems for businesses

The biggest issue for businesses is likely to be the length of time that must pass before proceedings can be issued. After the requisite initial ‘Letter of Claim’ has been sent to a debtor, a creditor will have to wait 30 days before issuing proceedings. Given that many businesses will offer a standard 30-day credit period before invoices must be paid, this potentially doubles the length of time that must pass before the creditor can take action to recover the debt.

If a debtor responds to a Letter of Claim within 30 days (and savvy debtors will quickly learn to do so at the end of that period) the creditor must wait a further 30 days from the date of the response before issuing proceedings. In terms of cash flow, particularly for small businesses, the additional 2 months that may be required before debt recovery action can be taken could be fatal.

What do I need to do to prepare?

This, of course, depends upon which side of the fence you are sat on.

Creditors that deal with their own debt recovery against individuals will need to familiarise themselves with the Protocol in order to avoid being penalised by the Courts for failure to comply with the new rules. Similarly, lawyers will need to understand the new rules and ensure that they are followed in cases where they will apply (for example, take note that the Protocol will not apply to business-to-business debts, unless the debtor is a sole trader).

Individuals who anticipate a debt claim being brought against them should also understand their rights, and the obligations upon the creditor, under the Protocol.

If you have any concerns about the Protocol or what impact it may have upon you or your business, our commercial litigation team can provide you with expert advice and guide you through the process.


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