September 2009 - Important update for Directors


Business Law Update
September 2009

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from Cousins Business Law

Gary CousinsWelcome to the September issue of the Business Law Update from Cousins Business Law.

This month we have some advice for developers and commercial property owners on the tricky legal topic of easements; guidance on how to avoid contract disputes and essential information for all Directors.

I hope you will find information relevant to your business in this month’s issue. We are keen to cover topics of concern to business people so, if you have questions or topics you would like us to cover, email your ideas to


Gary Cousins
0121 778 3212

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Important update for all Directors

All SMEs need to be aware that the new Companies Act has made some changes as to who directors are and registration requirements. Most of these will be in force by 1st October 2009.

Who is a director?

A director is anyone who has either been formally appointed as a director (by the shareholders or board as set out in the company’s Articles), occupies the position of director (even if they are called something else) or someone whose directions or instructions are generally followed by the board (called a ‘shadow director’).

In practice, this means that anyone who makes decisions concerning the running of a company, as well as anyone appointed as a director, could be considered a director. They will then have to understand and comply with company directors’ duties and can be held liable if there are any breaches of their duties. Read Understanding your Duties and Responsibilities as a Director for more details.

All private companies must have at least one director who is a human being (as opposed to another company). This is a requirement now for all new companies but companies already in existence before the Companies Act 2006 do not need to appoint a human being until 1st October 2010 at the latest. All human directors must be at least 16 years old.

Registration of Directors

Directors’ details must be registered in two places: in the company’s own register of directors and in the register kept at Companies House.

Although a director’s home address must be included in the company’s register, and notified to Companies House, directors can opt to use a ‘service address’ instead of their home address to be made public. The service address can be the company’s place of business.

Directors no longer need to register details of other directorships at Companies House. They must however now give details of all other names they are or have been known by whilst in business, including a married woman’s maiden name.

For advice on your duties as a director plus any queries on whether your role is covered by this legislation contact Gary Cousins by email or on 0121 778 3212.

Plain English Legal Advice

Understanding ‘easements’

Essential advice for property owners and developers

Developers and commercial property owners need to be very clear on their full rights in relation to any land or property they purchase or occupy, and one of the most commonly misunderstood aspects is the issue of easements – or the rights enjoyed over a piece of land.

Here are just a few examples of where the wording of easements has given rise to possibly unintended consequences:

  • A landowner can install speed bumps on an access road without the consent of those who enjoy a right of way over that road;
  • A right to use a water pipe does not automatically include a right to lay a replacement pipe if the original pipe falls into disrepair;
  • A right of way over land does not entitle you to park on that land;
  • Someone with the benefit of a right of way can insist on exercising that right over the exact route specified when it was originally granted even if you provide an alternative route which is just as convenient. This can frequently prevent the construction of an extension if a right is enjoyed over land immediately to the rear of a property.

Developers of course should not just be concerned about the rights the development site enjoys. It’s also essential to check what rights others may have over the site. These may be spelt out in the deeds but many rights can be acquired by long use.

For full details read Easements – know your rights on the Cousins Business Law website or call Steve Petty, Commercial Property Solicitor, for advice on 01926 629 005.

Plain English Legal Advice

Avoiding contract disputes

Disputes over contracts can happen for many reasons, but so often they blow up because those involved have a different opinion on what was agreed. You know the situation – you’ve had some work done or purchased a piece of equipment and you’re not happy with what you’ve received. You scrabble around for the paperwork but…:

  1. There is no paperwork, or
  2. The paperwork does not record what you thought had been agreed, or
  3. There is a reference to standard terms and conditions that you have never seen.

It is commercial reality that everyone is so busy clinching the deal that they fail to keep the paperwork in order. Businesses regularly fail to record the pre contract negotiations and fail to record the full terms of the agreement reached.

So what is the position where the written agreement/contract says one thing, but you believe that you agreed something different?

Read the full Avoiding Contract Disputes article on the Cousins Business Law website to understand the importance of recording everything, being fair and getting the paperwork right.

Useful Links

Getting ready for reversion to 17.5% VAT

All VAT registered SMEs need to prepare for the reintroduction of the 17.5% rate of VAT from 1st January 2010. HM Revenue & Customs (HMRC) has released detailed guidance which will help. Download a copy from the HMRC website here.

New trade mark application service

From 1st October 2009 the Intellectual Property Office (IPO) is to launch a new trade mark application service - Right Start. This alternative to the IPO's standard application service allows applicants to pay just half the normal fees upfront with their application, paying the rest only if they decide to go ahead after the IPO has assessed and commented on it.

Litigation Madness

Buskers far from entertaining

It is a sight that is familiar on our streets: musicians entertaining the passing crowd who show their appreciation by giving money. However, a recent case in Birmingham shows just how important it is that buskers have a sufficiently wide repertoire.

Guitarist, James Ryan, and dustbin-lid player, Andrew Cave, were buskers in Moseley, a suburb of Birmingham. The problem was that they only knew two songs, Wonderwall by Oasis and Faith by George Michael, which they played repeatedly one after the other for hours on end. Like many X-Factor contestants, they not only sang out of tune but also loudly and ‘wailingly’.

Following numerous complaints (60 from one local resident), the police decided to prosecute and the Birmingham Magistrates’ Court granted ASBOs preventing them from busking in the area. The court heard evidence from one witness, Matt Williams, who said, “I break down every time I hear Wonderwall or the intro to Faith. It was just one after the other, it was awful ... It completely affected my life.”

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Cousins Business Law is a member of the Law Society & regulated by the Solicitors Regulation Authority. Head Office: Swan House PO Box 11543, Birmingham, B13 0ZL. Tel +44 (0)121 778 3212. Fax: +44(0)121 275 6155