Legal News

The International Trade and Forfaiting Association ( ITFA) has revised section 5.2 of its manual on structured letters of credit, to clarify the...

Macom GMBH v Bozeat and others [2021] EWHC 1661 ( Ch) What are the practical implications of this case? This decision follows the trial of an unfair prejudice petition under CA 2006, s 994. These claims seldom reach a trial, so a published post-trial ruling is noteworthy in its own right. First, the petitioner held a majority stake rather than being in the minority. Because majority owners can, in normal circumstances, direct the company through internal governance, unfair prejudice actions are always brought by minority holders. Here, however, the acquisition terms granted a minority shareholder a casting vote in his capacity as a director. Consequently, the petitioner’s practical avenue was to advance this petition. Another striking feature is that the court declined to make the usual CA 2006, s 996 order for the respondent to purchase the petitioner’s shares. Although CA 2006, s 996 is cast in...

According to the European Commission, the EU will table its proposal to overhaul the World Customs Organization ( WCO), recognised as the global forum......

EMFC Loan Syndications LLP v The Resort Group plc [2021] EWCA Civ 844 What are the practical implications of this case? This decision is significant for transactional lawyers and litigators: To ensure a contract reflects the parties’ intentions, state everything expressly. If a term is to be a condition or warranty, make that explicit; otherwise it is innominate. Interpret and draft by reading the agreement as a whole and checking whether clauses fit, or conflict with, the proposed construction. A construction that seems unfair or unreasonable may still stand: the test is not fairness but what, objectively, the parties are taken to have agreed. Any effective cause term is subject to special wording or indicators in the contract and will depend on the particular facts and terms of each agreement, by reference to ordinary principles of construction and implication. ......

Re Hut Group Ltd; Zedra Trust Company ( Jersey) Ltd v The Hut Group Ltd [2021] EWCA Civ 904 What are the practical implications of this case? The Court of Appeal, in this decision, reaffirmed two central principles. First, when evaluating whether directors’ conduct, representing breaches of their fiduciary and statutory obligations to the company, amounts to conduct that is unfairly prejudicial to the petitioner, the critical enquiry is not to whom those duties are owed, but whether the complained‑of conduct unfairly prejudiced the petitioner in his capacity as a shareholder; if so, it is conduct capable of establishing unfair prejudice. Second, allegations of bad faith akin to fraud must be supported by the proper pleading of credible, cogent primary facts that sustain those allegations, either expressly or by reasonable inference drawn from them. Bare assertions or generalised averments of bad faith, advanced without pleaded...

A Introduction This paper explores whether running parallel schemes of arrangement is either required or desirable when implementing cross-border restructurings for companies incorporated in an offshore jurisdiction (namely the Cayman Islands, Bermuda or the British Virgin Islands (‘ BVI’)) whose principal operations or assets, in substance, lie predominantly within an onshore jurisdiction (specifically Hong Kong or the People’s Republic of China). The issue emerges from certain obiter observations made by Deputy High Court Judge William Wong SC in Da Yu Financial Holdings Ltd [2019] HKCFI 2531 (not reported by Lexis Nexis®), a case that concerned parallel and inter-conditional schemes of arrangement advanced in both the Cayman Islands and in Hong Kong in respect of a Cayman-incorporated company whose principal place of business, and only significant asset, were situated in Hong Kong. While approving the Hong Kong scheme, Deputy Judge...

Ahuja Investments Ltd v Victorygame Ltd and another [2021] EWHC 1543 ( Ch) What are the practical implications of this case? Mr Justice Vos determined that there is no overarching rule barring a claim to litigation privilege merely because the opposing party was prompted to give information they would not have disclosed had they known the genuine, deliberately hidden objective of the request. The rationale is that litigation privilege exists to permit a party to obtain material to place before their legal advisers for the conduct of their case without concern that such material must be handed to the other side (see paras [59] and [61]). That said, practitioners should exercise caution. The authorities reviewed demonstrate that where there is unequivocal deceit by the requester, and where the exchange involves the litigating parties themselves rather than a third party, the courts have not...

Robinson v Al- Qasimi ([2021] EWCA Civ 862) What are the practical implications of this judgment? This ruling sets out how far the Supreme Court’s stance on illegality in the insider dealing case of Patel has influenced employment-related illegality jurisprudence. In Patel, the Supreme Court held, amongst other things, that: the fundamental justification for the illegality doctrine is that upholding a claim would conflict with the public interest if it would damage the integrity of the legal system (or, potentially, certain elements of public morality) when determining whether the public interest would be harmed in that way, one must apply a ‘trio of necessary considerations’: whether denying the claim would further the underlying aim of the breached prohibition (for example, laws proscribing insider dealing) any other relevant public policy that the...

PPN outlines guidance for contracting authorities on the National Procurement Policy Statement ( NPPS), LNB News 03/06/2021 65 The Cabinet Office has issued PPN 05/21, drawing attention to core points within the NPPS. As a strand of the government’s programme to ‘transform public procurement’ in the UK, the NPPS defines national procurement priorities and the steps to realise them. PPN 05/21 takes effect for in-scope authorities from 3 June 2021. See: LNB News 03/06/2021 65. What are the main headlines from the new NPPS? The NPPS first appeared in the government’s Green Paper ‘ Transforming Public Procurement’, released at the end of 2020. In it, the government explained that the NPPS is intended to set strategic national priorities that contracting authorities must prioritise, ensuring the leverage of public procurement to advance those aims. Published alongside PPN 05/21 (which offers guidance and...

R (on the application of Good Law Project Ltd) v Minister for the Cabinet Office [2021] EWHC 1569 ( TCC) What are the practical implications of this case? The judgment is notable in confirming that reliance on PCR 2015, SI 2015/102, reg 32(2)(c) was lawful on the facts, yet did not absolve the defendant from running the procurement in a way that evidenced a fair, even-handed selection exercise. The court stressed the need to adduce proof that objective criteria underpinned the choice of contractor. Personal links between the decision-maker and the successful supplier did not, as a matter of principle, mandate recusal or preclude an objective evaluation of the award’s merits. Instead, the perceived bias stemmed from the defendant’s failure, on the evidence, to demonstrate that such an objective appraisal actually occurred. The decision will also be read for the judge’s...

‘ CV- Online Latvia’ SIA v ‘ Melons’ SIA Case C-762/19 What are the practical implications of this case? Across the EU, when a website or online database provides a search tool that automatically draws into its results information sourced from third-party databases, this will typically infringe database right. There can, however, be circumstances where the practice is lawful if it can be shown that using data from those third-party databases does not prejudice the maker’s investment—for instance, where the data is deployed in a wholly unrelated market that the maker neither foresaw nor competes in. Nonetheless, in most situations it will be necessary to obtain permission from the maker of any third-party databases employed to produce an aggregated search result. What was the background? A jobs website ( Melons) offered a search engine that queried several websites hosting job...

AB v Chethams School of Music [2021] EWHC 1419 ( QB) What are the practical implications of this case? The decision provides a clear illustration of the courts’ approach to applications under section 33 of the Limitation Act 1980 ( LA 1980) in sexual abuse claims. It emphasises that the persuasiveness of the evidence is the key consideration, even where a lengthy delay is understandable. Where substantial time has passed between the abuse and the issue of proceedings, practitioners should concentrate on the credibility and consistency of the claimant’s testimony. The judgment also contributes to the now well-established jurisprudence on the vicarious liability of educational institutions for sexual assaults by teachers and other staff. Many of the incidents occurred away from the school and while the perpetrator was acting as the claimant’s guardian rather than in a teaching capacity. Drawing on A v Hoare [2006] EWCA Civ 395...

The facts Uber BV, a Netherlands-based entity, owns the technology that powers the Uber app. Uber London Ltd, its UK subsidiary, holds a licence to operate private hire vehicles in London. The claimants, Yaseen Aslam and James Farrar, were licensed London private hire drivers and sourced trips through the Uber app. At the tribunal hearing, it was estimated that about 40,000 Uber drivers were active across the UK, with roughly 30,000 working in the London area. Drivers have no written contract with Uber London Ltd; instead, they enter a written agreement with Uber BV to access the app, and passengers likewise accept Uber’s terms in order to use it. In long-running proceedings, the employment tribunal, the EAT, the Court of Appeal and the Supreme Court grappled with two identical issues. First, were drivers obtaining bookings via the app “workers” of Uber for the...

Brown- Forman Beverages Europe Ltd v Bacardi UK Ltd [2021] EWHC 1259 ( Comm) (19 May 2021) What are the practical implications of this case? The rule from Holme v Brunskill (1877) 3 QBD 495 provides that any material change to the contractual terms between the creditor and the principal debtor releases a guarantor. If a variation has been made, the creditor must demonstrate that the change can only operate to the surety’s advantage, or that by its very character it can never in any situation increase the surety’s exposure. Parties may exclude this rule by agreement, and prudent creditors routinely do so. It has been labelled a snare for the careless creditor. This judgment confirms two significant practical propositions concerning the rule and points to a specific hazard. First, the court reiterates that the rule is confined to guarantees and does not extend to...

Original report HM Treasury issues its response to the consultation on the 2015 public service pension scheme reforms, LNB News 04/02/2021 109 What was the background to the consultation? In April 2015, the principal public service pension arrangements were overhauled with the declared aim of making them fairer, more sustainable and affordable, reflecting the 2011 Hutton Report. Change was deemed necessary as expenditure on the legacy schemes had risen over time. The government viewed the new designs as more progressive, seeking to smooth pension value across pay levels. Consequently, some lower and middle earners saw improved outcomes under the reworked schemes. A further feature was protection for those within ten years of retirement, who were excluded, wholly or in part, from the new schemes and kept in their legacy arrangements (or treated in a manner ensuring they were no worse off than if they had stayed in...

Sciortino v Beaumont [2021] EWCA Civ 786 What are the practical implications of this case? This ruling is poised to affect practitioners who advise on professional negligence claims, particularly proceedings brought against solicitors and barristers. Although the Court of Appeal reaffirmed that there is no ‘continuing duty’ to revisit or reassess earlier advice, it decided that a fresh breach of duty may arise on every occasion advice is given, even where it concerns the same point. That approach may assist claimants to pursue negligence actions that might otherwise have fallen foul of limitation. The Court of Appeal also confirmed that, subject to the express terms of the retainer, there is no ongoing obligation to scrutinise past advice for latent mistakes. Where negligent advice gives rise to loss occurring outside the limitation period, the claim will, in general, be time-barred. That outcome cannot be...

R (on the application of Cross) v Cornwall Council and Wilton [2021] EWHC 1323 ( Admin) What are the practical implications of this case? This decision offers practical direction to planners and practitioners on how to approach the giving of reasons for planning outcomes, notably where approvals run against officer advice, and on the considerations when tackling sometimes knotty alternative resolutions. There is no statutory obligation to provide reasons for granting permission. Yet, in defined situations, as the judgement explains, principles of common law and public law fairness oblige the authority to supply reasons. Existing caselaw—such as Dover DC v Campaign to Protect Rural England ( Kent) [2018] 1 WLR 108—indicates those situations include grants made despite strong public opposition, contrary to the case officer’s recommendation, and/or at odds with local plan policies. Here, the judge held that the duty to give reasons arose, rejecting the...

FBT Productions, LLC v Let Them Eat Vinyl Distribution Ltd, [2021] EWHC 1316 ( IPEC) What was the background? FBT Productions, LLC maintained it was entitled to interest under section 35A of the Senior Courts Act 1981, or, in the alternative, by virtue of the court’s inherent jurisdiction. It also contended that interest ought to be calculated by reference to US borrowing benchmarks, for example the US prime rate, or a margin of about 2.5% above the three-month US LIBOR, accruing from the date the infringing copies were delivered to the distributor. Let Them Eat Vinyl submitted that no award should be made......

Linfoot- Smith v Ansari [2021] Lexis Citation 93 What are the practical implications of this case? This decision stands out as an uncommon residential easement dispute concerning drainage rights. Though the claimant did not succeed on the alleged express easement, it is noteworthy that the court was content to read the phrase ‘in through or under’ as extending to a pipe fixed to the front of the property, mirroring the approach to a like clause in Trailfinders Ltd v Razuki [1988] 2 EGLR 46. The state of affairs on the ground as at the date of the 1934 conveyance bore heavily on the court’s conclusion to dismiss the express easement claim. On prescription, the ruling usefully sets out the categories of evidence the court is apt to treat as helpful, and those it is unlikely to consider of value. The judgment also offers...

What is land pooling and what is this type of structure used for? Put simply, land pooling is where a number of landowners collaborate to promote their land for development and to divide both the promotion costs and the sale proceeds. The objectives are two-fold: to encourage co-operation between owners to bring a site forward for development to secure an equitable split of costs and returns The principal tax consideration is capital gains. Imagine landowners A and B each own 50 acres and agree to share expenses and sale proceeds on a 50/50 basis. If A sells first, he pays capital gains tax (or corporation tax if a company). A then pays 50% of his net proceeds to B as an ‘equalisation payment’. That payment is not deductible in computing A’s capital gains tax ( CGT) position. To prevent...