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This Practice Note outlines the law concerning criminal recklessness. The subjective test for recklessness Certain statutory and common law offences allow the prosecution to prove mens rea through ‘recklessness’. Put simply, recklessness is where the accused takes an unjustified risk that results in unlawful harm or damage. The House of Lords in R v G reaffirmed the subjective approach to recklessness. Before R v G, two distinct tests were used, depending on the offence charged: Subjective recklessness from R v Cunningham: the prosecution had to establish that the accused personally foresaw the risk. Objective recklessness from R v Caldwell: the prosecution only needed to show that the risk would have been obvious to a reasonable person, without proving the accused themselves foresaw it. In R v G, the House of Lords concluded that the objective test could operate unfairly where a defendant did not foresee the
This Practice Note examines the remedy of rescission, explaining when and in what manner a contract can be unwound (at common law, in equity and under statute) and thereby terminated and brought to an end. It covers the consequences and effects of rescission, the principal grounds for setting aside an agreement (misrepresentation, mistake, undue influence, duress, non‑disclosure, fiduciary misdealing and bribery) and the main obstacles to claiming rescission—affirmation, the intervention of third‑party rights and the impossibility of restitution. For further guidance on rescission in the context of misrepresentation, see Practice Note: Misrepresentation—rescission as a remedy. There are many ways in which a contract may reach its end; see: Terminating contracts—how and when a contract ends—overview for a brief and accessible summary, with links to the related further practical guidance, including Practice Note: Termination and expiry of contracts. For a table
What is a res judicata? A res judicata is a determination by a court or tribunal with jurisdiction over the cause of action and the parties, which finally disposes of the issues decided so they cannot be litigated again by those bound, save on appeal. Final judgments entered by default or by consent fall within this concept, whereas rulings on purely procedural points and any decision lacking finality do not. The doctrine’s aim is to bring litigation to an end and shield parties from being harassed by the same dispute twice. in personam—binds the parties and their privies in rem—binds all persons, privy or otherwise (ie a judgment binding the whole world) A party may rely on res judicata: as an estoppel to defeat an opponent’s claim or defence; and/or as the basis of their own claim or
The offence of causing grievous bodily harm with intent Wounding or causing grievous bodily harm (GBH) with intent can be tried solely in the Crown Court on indictment. Elements of the offence Under the Offences against the Person Act 1861 (OATPA 1861), the prosecution must establish that the defendant unlawfully and maliciously: wounded with the intention of causing GBH, or caused GBH with that intention, or wounded intending to resist or prevent the lawful arrest or detention of any person, or caused GBH intending to resist or prevent the lawful arrest or detention of any person ‘Unlawfully’ and ‘maliciously’ Unlawfully The wounding or causing of GBH must be unlawful. Such conduct may be lawful if used: in self-defence in defence of another in defence of property for the prevention of crime where the victim gave express or implied consent For further information on these defences, see below:
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Risk to a parent company of giving a PCG A holding or parent company typically does not trade itself; instead it owns assets, such as shareholdings in other entities and the retained earnings they produce. It also delivers strategic oversight and management across the group. Businesses adopt this model principally to curb exposure to risk. By moving corporate assets into a holding vehicle, those assets are shielded from the hazards tied to contracting operations. Trading gains can likewise be protected from the losses and liabilities that may arise within a subsidiary. There are fiscal benefits too, as losses recorded by one subsidiary can be set against profits generated elsewhere in the group. As groups expand, the structure often deepens, with multiple tiers of parents culminating in an ultimate holding company that directs the companies below. This layering creates distance between the assets held in the...
The Competition and Markets Authority ( CMA), together with sector regulators holding concurrent competition powers, can levy penalties of up to 10% of an undertaking’s turnover where a breach of UK competition rules is established (specifically, the Chapter I and Chapter II prohibitions under the Competition Act 1998). Up to 31 December 2020, the CMA could likewise fine at that level for infringements of Articles 101 and 102 TFEU. The cap on any penalty is set by the undertaking’s worldwide turnover in its last business year—the highest fine the CMA (or sectoral regulators with concurrent enforcement powers) may impose is 10% of the undertaking’s global turnover. For these purposes, the “last business year” is the financial year prior to the date the infringement ceased. When determining the level of any penalty, the CMA (and relevant sectoral regulators) will be directed by the...
Director disqualification for competition law breaches In the UK, where a company is found to have infringed competition law and a director was involved, or ought reasonably to have known, the court can order that person to be disqualified from acting as a director of any company for up to 15 years. Any infringement of competition law can result in a disqualification order, on top of penalties imposed on the company itself, such as fines, and criminal penalties for individuals. The Competition and Markets Authority ( CMA) has issued guidance on competition disqualification orders. In addition, the CMA, together with the Institute of Risk Management, has published updated guidance on competition law risk for managers, directors and their advisers. The update contains case studies, examples of best practice, and forewords highlighting the CMA’s refreshed approach to detecting and enforcing against competition...
STOP PRESS: On 22 January 2024, an updated UK Corporate Governance Code (the 2024 UKCG Code) was released. It introduces only limited alterations to the current UKCG Code issued in 2018 (the 2018 UKCG Code). The 2024 UKCG Code applies to accounting periods beginning on or after 1 January 2025, save for Provision 29, which relates to the requirement for a board declaration on internal controls and applies to accounting periods beginning on or after 1 January 2026. In addition, the best practice guidance that accompanied the 2018 UKCG Code has been brought together into a single digital resource to sit alongside the 2024 UKCG Code. For further information, see News Analysis: UK Corporate Governance Code 2024 published—what’s changed? Definition Under section 271 of the Companies Act 2006 ( CA 2006), a public company must appoint a company secretary who has the...
This Practice Note should be read alongside Practice Note: Company names and business names, which summarises the legal requirements and restrictions governing company and business names. For information on the obligations to disclose a company’s name and other registration particulars at its premises, in its communications, and on business stationery and related documents, see Practice Note: Trading disclosures. Choosing a new company name Before taking any steps to change a company’s name, the company and its directors should confirm that the proposed name is permitted under the relevant legislation. The following set out the restrictions and requirements for company, limited liability partnership and business names: Companies Act 2006 ( CA 2006) The Company, Limited Liability Partnership and Business ( Names and Trading Disclosures) Regulations 2015 The Company, Limited Liability Partnership and Business Names ( Sensitive Words and...
It is a core principle of English company law that a limited company with a share capital must preserve that capital. Accordingly, a company is prohibited from reducing its capital except in ways permitted by statute and within the legal framework. The capital maintenance doctrine seeks to safeguard a company’s creditors by keeping the assets representing the company’s capital available to them for future claims and enforcement. The Companies Act 2006 ( CA 2006) sets out how a limited company may implement a reduction of capital. The CA 2006 restrictions on capital reductions do not extend to unlimited companies and therefore do not bind them. For details on that form of company, see Practice Note: Unlimited companies. This Practice Note concentrates on reductions of capital under CA 2006, Pt 17, Ch 10, with particular emphasis on those effected by special...
Charities face money laundering ‘attacks’ just as much as any other organisation. Trustees must safeguard their charity against these attempts and, to identify them, they need to fully understand the offences that can occur. What is money laundering? Money laundering is a criminal act, commonly defined as the process of transforming the proceeds of crime into assets or money that can be used legitimately and openly without attracting suspicion. The term ‘laundering’ reflects how criminals convert ‘dirty’ funds into ‘clean’ money, which can then be folded into the legitimate economy as if obtained lawfully. See Practice Note: Money laundering—key information for businesses. The offences The Proceeds of Crime Act 2002 creates a range of money laundering offences and applies to all persons, across the board. See Practice Note: Proceeds of Crime Act 2002—key information for businesses. While a single charity is unlikely to commit every possible offence, trustees should be aware of...
Ordinarily, a taxpayer may claim a capital loss on an asset only when it has been disposed of or completely destroyed. Where an asset has merely become worthless (ie of negligible value) but still exists, the normal rules do not permit a capital loss. For more information on claims for losses where assets are destroyed, see Practice Note: CGT—assets lost, destroyed or damaged. Negligible value claim Nonetheless, under section 24(2) of the Taxation of Chargeable Gains Act 1992 ( TCGA 1992), a taxpayer can ask for an asset they own to be treated as sold and immediately reacquired at the value stated in the claim. That amount is usually the asset’s market value and, in many cases, will be nil. Although ‘negligible value’ is not defined in legislation, HMRC considers it to mean ‘worth next to nothing’. The aim of the negligible value claim ( NVC) is to...
This Practice Note sets out the situations in which trustees of a settlement, or the personal representatives ( PRs) of someone who has died, can obtain principal private residence ( PPR) relief from capital gains tax ( CGT) in relation to property comprised in a settlement or within an estate for relevant CGT purposes. For a general explanation of PPR relief and its application to individuals, refer to Practice Note: CGT— PPR relief. Private residence occupied under the terms of a settlement Section 225 of the Taxation of Chargeable Gains Act 1992 ( TCGA 1992) widens the PPR exemption in TCGA 1992, s 222 so that it covers disposals of settled property where, for the trustees’ period of ownership, the dwelling-house has been the only or main residence of a person entitled to live there under the terms of the settlement. A...
Excluded territories exemption This Practice Note sets out the excluded territories exemption from a charge under the controlled foreign company ( CFC) rules. Even if a company qualifies as a CFC for an accounting period, a CFC tax charge arises only where: the CFC has chargeable profits that pass through the gateways; and none of the exemptions within the CFC rules apply There are two types of exemption: entity level exemptions — these take the CFC outside the CFC rules altogether for that accounting period......
STOP PRESS Major changes to the UK prospectus framework took effect on 19 January 2026. The updated regime for public offers of securities and for admissions to trading in the UK is contained in the Public Offers and Admissions to Trading Regulations 2024, SI 2024/105 (the POATRs), together with the FCA sourcebook, The Prospectus Rules: Admission to Trading on a Regulated Market ( PRM). The UK Prospectus Regulation and the FCA Prospectus Regulation Rules have been revoked. These reforms aim to streamline fundraising and markedly cut the instances when a company must produce an FCA-approved prospectus for a subsequent share issue, and in the UK reduce prospectus requirements accordingly. For comprehensive details of the amendments, see Practice Note: UK prospectus regime reform. This Practice Note records the prospectus regime as it stood before 19 January 2026. It also outlines the cash box...
What are capital allowances? Capital allowances provide tax relief for certain, though not all, items of capital expenditure. They function as a standardised, tax‑deductible stand‑in for depreciation or amortisation, broadly intended to deliver relief that mirrors the economic life of business assets. For income or corporation tax returns, accounting depreciation is not deductible; capital allowances are claimed instead. Eligibility is restricted and some assets are excluded. For example, spending on land does not qualify. The most frequently encountered allowances are for plant and machinery. The scope of plant and machinery for capital allowance purposes is set out in Practice Note: Plant and machinery allowances—definition of plant and machinery. Since October 2018, relief has also been available for specified expenditure on structures and buildings, or parts of them, where their construction is treated as commencing on or after 29 October 2018; see Practice Note:...
Registration of aircraft mortgages at the Civil Aviation Authority ( CAA) This Practice Note explains how to record aircraft mortgages with the Civil Aviation Authority ( CAA) within a typical aviation finance deal. It does not address every action that might be necessary to perfect security over an aircraft. For guidance on filing security at Companies House, and on how that filing interacts with entry on the UK Register of Aircraft Mortgages, consult Practice Note: Perfecting security over aircraft and registering security on the UK Register of Aircraft Mortgages. See also Practice Note: Aviation finance and the Cape Town Convention. The CAA is responsible for keeping the United Kingdom Register of Civil Aircraft (the ‘ Register’). The Register contains entries where an aircraft serves as collateral for a mortgage or loan. It does not, however, record other categories of security interest, for example liens over the...
The Bribery Act 2010 ( BA 2010) criminalises: offering or giving a bribe to another person (active bribery) requesting, agreeing to receive, or accepting a bribe (passive bribery) bribing a foreign public official for a business or commercial organisation only, failing to prevent bribery The purpose of this Practice Note is to present a general overview of the active and passive bribery offences in BA 2010, ss 1 and 2, together with the offence of bribing a foreign public official under BA 2010, s 6; in essence, the giving or receiving of bribes. It does not include a synopsis of the corporate offence of failing to prevent bribery, which is dealt with in Practice Note: Failure to prevent bribery—the offence. This Practice Note should be considered alongside Practice Note: The Bribery Act 2010—an introductory guide. BA 2010 came into force on 1 July 2011. Conduct occurring prior to...
This Practice Note outlines the key FCA rules applying to appointed representatives ( ARs) who perform regulated activities on behalf of authorised persons. Where the conditions of the AR framework are satisfied, ARs are exempt from obtaining their own authorisation. For guidance on the contractual requirements for ARs, see SUP 15 and the Practice Note: Contract requirements for appointed representatives. For further guidance on arrangements with multiple principals, see Practice Note: Multiple principals and appointed representatives; and for more detail on a principal's responsibility for its ARs, see Practice Note: A principal's responsibility for its appointed representatives. The FCA Handbook also explains how to contact the FCA's Supervision Hub with appointed representatives enquiries. New regime for appointed representatives Together with HM Treasury's call for evidence on the AR regime, in December 2021 the FCA published consultation paper CP21/34 proposing enhancements to its AR...
Source of funds and source of wealth- FAQs This practice note is aimed at law firms and brings together frequently asked questions on source of funds/wealth under the anti-money laundering ( AML), counter-terrorist financing ( CTF) and counter-proliferation financing regime, including: Must I identify the source of funds for every transaction? What steps should I take to evidence the source of funds and/or wealth when conducting CDD or ongoing monitoring where a transaction is funded by cryptocurrency converted into British pounds? Third-party funds-to what extent should I undertake CDD to verify identity and/or the source of funds? Do I need to establish the source of funds for every property matter? Do I need to determine the source of funds for every transaction? There is no universal requirement to confirm the source of funds for every client and matter. That said, gaining an...
Operating leases are widely used across the airline sector. Because aircraft have long service lives, a mature marketplace for trading pre-owned aircraft has emerged. For a lessee, the essentials are that the leased aircraft is airworthy and that it can operate it without interference from the lessor. For a lessor, the fundamentals are being paid for the lessee’s use of the aircraft and avoiding any loss arising from the lessee’s operation of the aircraft. This Practice Note sets out what an operating lease is, how it contrasts with other leasing structures, and the core concepts underpinning the business of operating lessors. It highlights the principal clauses typically found in operating leases, including delivery condition, quiet enjoyment, rent and deposits, and operational indemnities. It also addresses key provisions on subleasing and events of default. The business of operating...
What is the aggregates levy? HMRC administers an environmental tax, the aggregates levy, on the commercial exploitation of aggregates across the UK. When does the levy apply? The levy becomes chargeable when both conditions below are satisfied: there is a taxable aggregate, and that aggregate is commercially exploited within the UK There are pending amendments to Finance Act 2001, s 16(2) to substitute ‘the United Kingdom’ with ‘ England, Wales or Northern Ireland’ under Scotland Act 2016, s 18(3). The Act received Royal Assent on 23 March 2016, but the commencement date has not yet been appointed, and it is expected to change in line with the introduction of Scottish Aggregates Tax from 1 April 2026. Meaning of taxable aggregate Aggregate Aggregates means: rock gravel sand It also includes substances incorporated within, or naturally occurring alongside, those materials, such as spoil, waste, off-cuts and other...
This Practice Note provides a starter overview of acquisition finance for readers with little or no prior exposure. It sets out: what acquisition finance means the parties involved and the documents used in an acquisition finance deal typical structures for acquisition finance transactions the main phases of an acquisition finance transaction the key legal topics to consider recent developments of particular relevance to the leveraged finance market It also directs you to related resources within Lexis+. Understanding key terminology Acquisition finance involves extensive jargon and shorthand. For explanations of common expressions, see Practice Note: Glossary of acquisition finance terms and jargon. You may find it useful to read this Practice Note alongside the glossary. What is meant by the term acquisition finance? Acquisition finance transaction The phrase ‘acquisition finance transaction’ generally describes the purchase of a business that is largely funded by debt...
This Practice Note examines the limits of the trustees’ duty not to fetter their discretion. It should be read alongside the Practice Note: Discretionary decisions—what must pension trustees do?, which looks more generally at how trustees should exercise their discretions. What does the duty mean and what are its consequences? A fetter is a curb, a restraint, or a means of keeping someone within bounds. In pensions, the expression is often used for express or statutory limits placed by the setlors/parliament on the use of a power, eg conditions for the valid exercise of a power of amendment. That is not our concern here (for more, see Tolley’s Pensions Law Service, para F1.9). This Practice Note instead addresses fetters arising from trustees’ own acts when wielding their powers. The core principle is that, in exercising a fiduciary power, a trustee must reach a judgment having regard to the...
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When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...
This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...
Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...
I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...
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