Wednesday April 10, 2013 at 10:58am
Since I last blogged on the subject in November 2012 (click here to see it), there have been some changes which came into effect on 16 March 2013. The Late Payment of Commercial Debts Regulations 2013 only apply to contracts entered into on or after 16 March.
You may recall that if there is no contract credit period for payment, and no convention such as 30 or 60 days has been established, then the default period is 30 days. Because many contracts provide for longer periods for payment, and pu.... (read more...)
Monday March 4, 2013 at 1:50pm
The government came to power in 2010 promising to get rid of unnecessary red tape, or at least not to increase it through its ‘one in one out’ policy. The Department for Business Innovation and Skills (BIS) invited business leaders to tell them what regulations they wanted scrapped as part of its Company and Commercial Law Red Tape Challenge. My hopes of soon seeing business freed from the binds of excessive red tape were soon disappointed. Instead of taking decisive action, the gove.... (read more...)
Sunday March 3, 2013 at 4:07pm
It now looks likely that the ancient law of distress will be abolished this summer. But what does this mean for commercial landlords and tenants? The proposal was first made 22 years ago, and the legislation passed back in 2007, but it was never brought into force. But the government has recently announced that they will introduce it this summer. What it will mean is that landlords will not be able to send in bailiffs to seize goods without due notice. No longer will tenants in arrears of rent h.... (read more...)
Monday February 4, 2013 at 6:54pm
It often happens in business: you signed a contract that you later regret. Sometimes it’s because the other party is not performing as expected but, at other times, it’s just because you’ve changed your mind. It’s usually not easy to get out of a contract but what follows are things to consider. Has there been a breach? The first point to consider is whether the other party has done anything wrong. They might, for example, be in breach of a term in the contract or maybe t.... (read more...)
Wednesday January 2, 2013 at 10:20am
Step 1 - Identify your position • look at exactly what has happened and gather together all key documents such as any relevant contract, terms and conditions, correspondence and e-mails. • identify your key personnel who would be called upon to give evidence. Get written statements from them as soon as possible. • consider obtaining early expert evidence on any key points • get early legal advice as this could dictate how you handle the dispute to your best advantage. It will.... (read more...)
Tuesday December 4, 2012 at 10:03am
I often advise companies who believe that a director can be removed from office simply by sending Form TM01 to Companies House. Unfortunately, this does not remove a director and is unlawful unless the correct steps have been taken beforehand. The following procedure should be followed: 1. Look at the Company’s Articles (and any shareholders’ agreements) as these will set out certain requirements that your particular company must follow. They will also set out certain circumstances t.... (read more...)
Monday December 3, 2012 at 2:09pm
Summary A partnership is a relatively simple way for two or more people to own and run a business together. However partners do not enjoy any protection if the business fails and you should definitely get a written Partnership Agreement drafted. How to make a business partnership legal This is a question we’re often asked to consider – but normally only when things have gone wrong in a business relationship. It comes up when business partners or directors want to go their separa.... (read more...)
Thursday November 29, 2012 at 3:51pm
With cash flow problems in a difficult economic landscape, do not forget the Late Payment of Commercial Debts (Interest) Act 1998 which could be a useful tool to persuade prompt payment. If the threat does not work the Act provides for the debtor to pay compensation, which can be substantial.
The Act only applies to commercial debt, and so will not help where the late payer is not a business or public sector organisation. For contracts entered into after 2002, all companies are subject to the .... (read more...)
Monday October 29, 2012 at 1:49pm
It is often said that large businesses are at an advantage when it comes to litigation as they have bigger pockets. From my experience, that’s only part of the reason. They also have more experience of litigation and know how to work with their lawyers as a team in order to minimise their costs. They tend to appoint an individual (or sometimes a team) to help their lawyers prepare their cases. They know that a lawyer is best placed to handle the legal side of things but it’s cheaper .... (read more...)
Tuesday September 25, 2012 at 4:23pm
I am often asked if a Personal Guarantee is unenforceable if independent legal advice was not taken before it was signed. The answer, as with many things, is “it depends”.
It is always worth looking to see if the bank or other person or organisation taking the guarantee has followed their own procedures. It is now rare for a bank or other financial institution to make a mistake, but they can happen. They must prove by their paper trail that they have complied with their own procedu.... (read more...)
Wednesday August 15, 2012 at 10:27am
There are many times that work is carried out where no price has been fixed. Does this leave the workman without a claim? Not a bit of it. It has long been a principle of English law that someone should not have the benefit of unjust enrichment.
There are 3 possible scenarios:
1. Work has been done under a contract that has subsequently been found to be invalid 2. Work has been done for someone who expressly or impliedly requested it but no price was agreed 3. A price was agreed but only par.... (read more...)
Monday July 30, 2012 at 4:03pm
Is there increasing friction between you and your fellow shareholders and/or directors? Are your board meetings starting to bear a striking resemblance to Alan Sugar’s ‘Apprentice’ ones? If so, then you need to take action and start to think tactically. The first points to consider are as follows. Know your legal powers Are you a shareholder, director, or both? The voting powers of directors at Board Meetings are usually equal (although often a Chairman will have the casting vo.... (read more...)
Monday July 2, 2012 at 11:33am
One thing that struck me about the recent news story when the Prime Minister, David Cameron, said that comedian, Jimmy Carr, was “morally wrong” in trying to reduce his tax bill legally was the fact that he had to resort to a plea for morality. As a commercial dispute lawyer, I often come across parties who state that they have a “moral right” to redress. Like all lawyers, I know that a call to morals in a business dispute context is an admission of failure. The subtext I.... (read more...)
Thursday June 21, 2012 at 10:14am
It is a mistake to assume that personal gurantees to banks are always enforceable. It is true to say that these days the high street banks usually have watertight paperwork and have covered off any potential loophole, but one recent case demonstrates how a lender can get it wrong with the result that the guarantee in unenforceable.
My client was a relative of the lender’s client. The lender was not a high street bank. My client guaranteed payment by the borrower to the lender. He obtaine.... (read more...)
Thursday May 24, 2012 at 9:55am
I know from my experience of talking to clients that for most small, family or owner managed businesses, the prospect of picking up the phone and first talking to a solicitor is not something they relish. You might expect that cost would be the main reason that they dread that call but, in fact, it’s often different factors that come into play: things like not knowing which lawyer to select, not knowing where to start in explaining their requirements, and dreading talking to some pompous, .... (read more...)
Tuesday May 15, 2012 at 9:08am
The failure of Greece to form a government following elections has led to many believing that a Greek default and exit from the Eurozone is now more likely than not. If this happens, then it is probable that other countries in difficulty, such as Portugal, Italy and Spain, will soon follow, and possibly other countries too. If you trade with any of these countries, then you should now be putting plans into effect to protect your business and minimise your exposure. What a Euro default will look .... (read more...)
Friday May 4, 2012 at 7:30pm
We hear plenty about celebrity pre-nuptial agreements in the media. Whilst I’m not about to discuss the merits or otherwise of those, I do think there is plenty of merit in what could be called a business ‘pre-nup’. What I’m referring to is a shareholders’ agreement. A shareholders’ agreement is an agreement between all or some of the members of a limited company. In such an agreement the shareholders can deal with issues which either aren’t covered by t.... (read more...)
Friday March 30, 2012 at 9:12am
As a solicitor who defends directors when they get into problems with liquidators, fellow directors and shareholders, suppliers and customers, as well as government bodies, I am constantly struck about how most of these problems could have been avoided if directors hadn’t made a few basic mistakes. So here’s my list of 6 mistakes that I’ve seen since the beginning of the year that have led to real problems, heartache and unforeseen expense for my director clients.
Going in.... (read more...)
Wednesday March 28, 2012 at 10:00am
When starting a new business the legal aspects are often the ones that get forgotten, or at best sorted out with reluctance. As your business grows and becomes more successful the risks involved can become greater. Still, worrying about the legal side of things may not take number one priority. I’ve put together these tips for small business owners, they cover the essentials you should consider from a legal perspective and will hopefully keep you out of the hands of my dispute manage.... (read more...)
Wednesday January 18, 2012 at 1:10pm
The Government has announced plans to begin a major cut back of health and safety red tape. It will begin an immediate consultation on the abolition of large numbers of health and safety regulations and intends to have removed the first rules from the statute book within a few months.
It seems David Cameron has finally realised how crippling the raft of health and safety legislation can be for the average business. He’s recognised that health and safety legislation has become an "al.... (read more...)
Thursday December 15, 2011 at 12:16pm
Businesses are constantly juggling resources to survive and grow. One of the decisions they have to make is when to take legal advice when entering into contracts. The reason they may choose to do without advice is the perceived cost. But the consequences can in many cases be more costly than the initial saving. I even come across businesses that fail following a costly court case when they thought they were adequately covered by a simple contract that didn’t in fact do the job it was supp.... (read more...)