Category Archives: contract law

Property disputes; what’s that all about?

Whereas businesses can encounter all sorts of legal issues and disputes in their day to day operations, one area that seldom gets mentioned is that of “property disputes” specifically disagreements about working premises and where a company conducts their business.

So what happens during a business property dispute and what to expect?

There are several types of property dispute that can arise, such as disagreements between a landlord and tenant over subjects such as tenancy agreements or rent; then there can be issues involving the lease itself regarding disagreements on how the property can be used and for what purposes, or even the right to use your property as the location for your company. Then we can encounter boundary disputes; if another company or landlord claims some of your land or encroaches on your property. Then there are potential arguments over construction and planning, especially if you want to expand and face opposition from other residents or local groups. There can even be disputes when buying or selling land for your company.

If any of the above scenarios occur, in general you should be prepared to deal with varying periods of negotiation and or litigation, depending on the type of dispute.  In boundary disputes, for example, you will need a good legal team to find a satisfactory resolution through the courts; to present your evidence and put your argument forward.  Then, after both sides have made their case, a presiding judge will rule in favour of one party or the other. In planning issues, you will have to submit detailed plans to the council and explain what you intend to do, and then there will be private and public consultations before any work can commence.

All this can take up a lot of time and money so it’s always good practice to get the best legal advice from the outset to minimise your risk; why not give us a call?

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Filed under Arbitration, Construction, contract law, Dispute resolution, Planning Law, Property Development, UK Law

Thinking about an LLP?

Limited Liability Partnerships are becoming ever more commonplace so now might be a good time to look at possible pitfalls that may arise unless the LLP is founded upon an agreed basis in writing. There is no legal requirement to have a written agreement in place in a Limited Liability Partnership, as the default provisions of the 2001 LLP Regulations will apply in the absence of one, but there can be dangerous ramifications if the partners just rely on these. Here are some of the potential problems if you don’t have a written agreement in place.

Under the regulations, every partner is entitled to participate in the management of the LLP’s business as an equal, regardless of their experience or financial input into the partnership, this could lead to resentment and poor management, and so it’s probably best to create some form of decision making tree and division of responsibilities from the outset. Similarly, all partners will be entitled to an equal share in the capital and profits of the partnership regardless of how much they initially contributed, unless there’s a written agreement in place to the contrary.

General decision making regarding normal business matters are decided by a simple majority under the default provisions and changing the nature of the business would require a unanimous consent, this might lead to a level of inflexibility in a changing market so is also probably best addressed in a written agreement.

Remuneration is another possible source of contention as under the default provisions, partners have no automatic entitlement to be remunerated for their work in the LLP other than by way of profit share. This would need to be looked at in cases where some partners work in the business full time and would need paying on a regular basis.

Other contentious issues will LLPs relying on the default provisions of the 2001 regulations include the introduction of new partners into the LLP, expulsion of existing members; under the regulations, a partner can’t be expelled by a majority of the other partners unless the power to do so has been conferred by an express written agreement setting out the circumstances allowing such an expulsion; for example, if they are in material breach of the agreement, or have taken too prolonged an absence from the company.

So if you are thinking of setting up a Limited Liability Partnership, why not give us a call?

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Filed under Commercial law, Company Law, contract law, Dispute resolution, UK Law

Worker-Employee, what’s the difference?

Good question, you may say, since October 2016 the government has been carrying out an enquiry into whether the terms “Employee” and “Worker” are properly defined legally. Currently there are three possible categories; “employee”, “worker” and “self-employed/freelance”

“Workers” are entitled to certain employment rights, including, getting the National Minimum Wage protection against unlawful deductions from wages, the statutory minimum level of paid holiday, the statutory minimum length of rest breaks,  to not work more than 48 hours on average per week or to opt out of this right if they choose, protection against unlawful discrimination, protection for ‘Whistleblowing’  and to not be treated less favourably if they work part-time.

“Employees” have all the rights workers have plus the following; Statutory Sick Pay, statutory maternity, paternity, adoption and shared parental leave and pay (workers only get pay, not leave) minimum notice periods if their employment will be ending, protection against unfair dismissal the right to request flexible working , time off for emergencies and Statutory Redundancy Pay.

“Freelance or casual”, have none of the above rights as they are deemed to be “self-employed” and are only covered for general statutory duty of care, for their health and safety and, in some cases, protection against discrimination. Any rights and responsibilities are set out by the terms of whatever contract they can negotiate with their client.

Evidence put before the enquiry, however, suggests that two categories would improve the situation, “employed” and “unemployed”. “Employed” would mean that all workers have the same rights as employees to make things as simple as possible for businesses since tribunal and court judgments so far have not always managed to explain the differences clearly. This often creates situations where businesses look to minimise their legal obligations by trying to structure their relationships slotting people into the least burdensome category, like in the recent Uber case; what might start out as a clear self-employment relationship, in practice can turn into something quite different once the law gets involved.

We’ll have to wait and see what comes of all this but meanwhile if you need any help or advice on this or any other legal topic, give us a call.

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Filed under Arbitration, contract law, Dispute resolution, Employment Law, HR Issues, Mediation, UK Law, Unfair Dismissal, Whistelblowing, Zero hours

Latest changes in the Legal System

The various specialist civil courts in England and Wales will be reorganised and be officially known as the “Business and Property Courts of England and Wales” from June 2017. They will handle, amongst other matters, international dispute resolution jurisdictions. The courts included within the Business and Property Courts will be as follows:

  • The Commercial Court which will continue to cover all its existing subject areas of shipping, sale of goods, insurance and reinsurance etc.
  • The Admiralty Court.
  • The Mercantile Court.
  • The Technology and Construction Court which deals with major technology and construction cases.
  • The Financial List which deals with all banking and financial market issues.
  • The Companies and Insolvency Court.
  • The Patents Court.
  • The Intellectual Property and Enterprise Court.
  • The Competition List.

The new structure will provide more flexibility while preserving the practices and procedures of these courts. Judges with suitable expertise and experience will be able to cross-deploy so as to be able to sit on cases where their expertise can be best utilised. The current situation means that judges who are experts in a particular legal field are not readily available to sit in cases in that area in another court, so, highly expert competition law judges in the Queen’s Bench Division cannot easily sit on the bulk of competition law cases that take place in the Chancery Division.

The overall intention is to enhance the U.K.’s reputation for international dispute resolution and to ensure that the U.K. continues to provide the best business court-based dispute resolution service in the post Brexit world. Business and Property Courts will be set up in Birmingham, Bristol, Cardiff, Leeds and Manchester, initially with planned future courts in Newcastle and Liverpool and these courts will enhance the connections between Business and Property work carried out both outside and within London.

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Filed under Arbitration, Commercial law, Company Law, Competition Law, Construction, contract law, Copyright Law, Dispute resolution, EU Law, Intellectual Property, Legal news, UK Law

Oh No, you didn’t…

Contractual disputes can be costly and time consuming, if you are not careful you could end up in court and damage your or the other company’s business relationships and reputation. Unfortunately all businesses will have a contractual dispute sooner or later. Contracts must include a series of elements to make them valid and both parties need to be clear about and have a solid understanding, and most importantly, mutually agree the terms of that contract; without a mutual agreement, the contract is not legally valid and can be contested in court. All contracts must have an element of an offer being made, an acceptance of that offer and a form of payment for the goods or services concerning that offer. Contractual disputes often develop during this process and can involve anyone; your employees, your business partners, your clients and your suppliers.

Common types of disputes involve issues that arise from:

  • When someone reviews your contract and/or an offer you’ve made in that contract
  • Disagreements regarding the meaning of a contract’s technical terms
  • Mistakes and errors regarding the terms in the contract
  • A conflict arising involving your employees and/or business partners
  • Failure to stand by an original agreement made months or years earlier
  • Failure to perform a duty expressed in a contract, a breach, such as failing to deliver goods within an agreed timescale.

If any of the above should happen, it’s vital to try to resolve the dispute as best you can immediately and by mutual agreement but if that’s not possible it’s best to get the best legal support to help you find the right resolution for your business. Any solution or resolution should not be so time-consuming that it will affect the normal running of your company; it should not be too costly which can adversely affect your company finances and aim to handle the matter carefully, so avoiding damage to business relationships and your reputation and lastly, try to find a solution that doesn’t result in the dispute going to court.

There are two types of remedies in a contractual dispute; legal and equitable. Legal remedies allow for the victim in a dispute to obtain monetary damages for the breach for any loss they have suffered as a result. Equitable remedies on the other hand, are attempts to find a solution to resolve the dispute that isn’t related to money. An Equitable remedy could include:

  • The cancellation of an old breached contract and replacing it with a new one to account for the changed or different needs of each party.
  • Rewriting part or all of a contract to correct any errors or misrepresentation of technical terms
  • Requesting that a breaching party perform the duties agreed to in the contract, i.e. providing goods or services as originally agreed.

Getting good legal support is crucial during a contractual dispute to help you collect and analyse the relevant evidence, investigate specific details and document essential information to conclude a dispute effectively, so if you are involved in a contractual dispute, give us a call.

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Filed under Commercial law, contract law, Dispute resolution, UK Law

We’ve Changed our Mind: Withdrawing an offer of Employment

There was an interesting article in the Daily Telegraph recently about unforeseen side effects of the industrial dispute within Southern Rail; people who had been offered jobs or about to be offered jobs that could have those offers withdrawn because they lived on a Southern Rail train line route.

This situation highlights the legal ramifications of what can happen if an employer offers employment and subsequently withdraws the offer before or shortly after the employment commences. The prospective employees can’t in any event, bring unfair dismissal claims as they won’t have the two years’ continuous service required.

There can be still be problems for an employer who takes such action; great care has to be taken over what is said to a job applicant, whether directly or via a recruitment agent, to ensure that a legally binding contract is not created inadvertently and we also may have an issue over how an employer can withdraw a job offer and the amount of notice it may have to give.

In the first case, employers should remember that a verbal offer of employment may form a binding contract if it is accepted by an applicant. Any verbal offer should be expressly state that full details of the offer will follow in writing and that the offer is subject to contract terms being agreed. Employers should also clarify any conditions attached to offers of employment such as satisfactory references, so that if these are not satisfactory, the offer can be withdrawn without breaching the contract.

If employers do need to withdraw an offer, they can normally do so by giving notice although this can give rise to disputes over an applicable notice period, but this can be dealt with by agreeing contract terms at the time the offer is made, especially if an employer intends to apply a short notice or probationary period at the start of employment. Legally however, the default is that the statutory minimum notice will apply. Statutory notice can be zero during the first month of employment before increasing to one week.

With all these and other potential issues and with the misery that withdrawing a job offer could cause, best practice is always to only make a job offer when you’re as certain as you can be about it and never withdraw the offer on a whim. As always if you need more detailed help or advice on this topic, give us a call.

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Filed under contract law, Dispute resolution, Employment Law, HR Issues

Commercial Property: Useful knowledge.

Commercial Property Law is highly complex, never try to muddle through on your own, make sure you have a specialist property solicitor on your team to ensure you get the best professional advice from the outset. That said, here are a few pointers towards “best practice”.

If you want to lease or rent commercial property, it’s highly unlikely you will get a lease longer than 15 years and there is often a tenant break clause option at around the five year mark that enables a tenant to terminate. It’s always best to get a break clause included if there isn’t one and also check the small print as tenants often have to comply with all lease obligations before they can exercise a break clause; the landlord could refuse to allow you to terminate if you fail to comply with an obligation such as redecorating or carrying out minor repairs to the property. When leases expire, tenants usually have an automatic right to renew, unless the landlord needs to occupy the premises or has plans to demolish or redevelop the property.

It’s always good policy to discover what the average rent is for any similar properties in the area. That way you know if the landlord is being fair; most landlords expect tenants to pay rent for the next three months in advance, but there’s no harm asking to pay monthly instead and always check if the rent includes VAT so you might be able to claim it back. If you need to make changes to the premises most landlords will also agree to a rent-free period to compensate for this cost.  Landlord or tenant, get a specialist solicitor to either draw up the terms or review the lease before you sign it. A lease is a legal contract between tenant and landlord; failure to abide by the terms of a lease could lead to court action.

It also pays to discover what other charges are involved, like annual insurance costs, local authority commercial rates, property taxes, and utility charges. Also get the landlord to carry out any repairs before you take on the lease, and be careful to determine who will end up paying for them, commercial leases are often “fully repairing”; most landlords like to pass on responsibility for their repairs, maintenance and replacement to a tenant throughout the term of the lease.

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Filed under Commercial Property, contract law, Dispute resolution, Planning Law, Property Development