The Law on Swearing - Rooney Beware!

When you or I let out a string of expletives (c'mon - we've all done it!) it's usually because we've just stubbed our toe, had some bad news, are stressed or any number of other minor reasons that affect us all in our everyday lives.  Most of the time we're in the privacy of our own homes or with friend or family who we know won't take too much offence (or will take us to task in a relatively relaxed way about it!).

But what about people who swear (usually loudly!) in the street?  The issue is even more relevant when a footballer of some repute (and who might be argued to be a role model for thousands of fans) swears directly into a television camera which will clearly be broadcasting to millions.

Of course in that particular situation, the FA has taken some action - in the same way that if I were to swear at a client the Law Society would probably have something to say about it.

But there's an argument that an example should be made in these situations - a sense that public figures who earn millions of pounds and who set their stall out both as role models and as spokespeople for certain brands of food, sporting goods and other merchandise should at least be treated in the same way as you or I would be treated in those circumstances.

So is it against the law to swear?

Well, yes and no.

Section 5 of the Public Order Act 1986 make it an offence to

(a) use threatening, abusive or insulting words or behaviour, or disorderly behaviour, or

(b) display any writing, sign or other visible representation which is threatening, abusive or insulting,

within the hearing or sight of a person likely to be caused harassment, alarm or distress

There are three defences :-

(a) The defendant had no reason to believe that there was any person within hearing or sight who was likely to be alarmed or distressed by his action.

(b) The defendant was in a dwelling and had no reason to believe that his behaviour would be seen or heard by any person outside any dwelling.

(c) The conduct was reasonable.

So it's OK to swear at home (as long as all your windows aren't open with the local children playing outside) (phew!!) but not in the street in front of old ladies.

In an age, though, where we're becoming more used to (and accepting of!) the use of language which would, even 20 years ago, have been found to be wholly unacceptable by society in general the issue of whether a person is likely to be caused harassment alarm or distress is a bit of a movable feast!  Generally speaking the courts apply the test of the "man on the Clapham omnibus" - that is to say whether an "average" person would be offended.  Again, though, the "average" person changes as society as a whole changes.

Is it arguable that the millions of people who saw Rooney swear to camera were all likely to be football fans who would be used to, and indeed expect, that sort of behaviour in the heat and excitement of a goal celebration?

Well maybe - but then again the chances of every single person watching the TV at that point being over the age of 18 are, I suspect, slim to none.

And even if the offence has been committed, the level of fine to a footballer who earns what Wayne Rooney earns is far less significant than a ban from playing a game which he clearly lives for - so perhaps the punishment meted out by the FA really does fit the crime in this instance.

There's arguments both ways of course - that Rooney should be subject to the same punishment that you or I would be subject to for swearing at an old lady in the street.  Justice should, after all, not discriminate.

I would expect that that won't happen though - just don't use it as an excuse to vent your anger in the local shopping centre next time the queue in M&S is too long!

Social Media Nightmare!

The employment tribunal has recently decided that an employer was within its rights to dismiss an employee who had sent an offensive email to a fellow employee - even though the email was sent from the employee's home computer to the colleague's home computer!

The simple fact that the email was not sent via, nor received by, the employer's computer system did not, in the view of the tribunal, mean that the employer had any less right to protect its reputation.  It does, though, create real conflict between the employer's rights and the right of the employee to privacy outside the work environment.

Beware Facebook entries!!

The end of auto renewable contracts?

Ofcom (the communications regulator) has started a consultation into a proposal to outlaw contracts which automatically renew at the end of their term and which tie the customer into a minimum repeated contract term.

The idea behind these contracts is that the customer has to "opt out" otherwise renewal takes place automatically.  Once automatic renewal has occurred then there is usually a penalty to terminate the contract early.

BT is the main provider of "rollover contracts" although several other suppliers also use them, and Ofcom estimates that 15% of UK consumers are subject to these contracts at present.

The consultation ends in May this year so with luck we might see the end of these sorts of arrangements shortly after!

Valuer's duties to borrower clarified

Traditionally if your mortgage lender instructs a valuer to value a property you intend to buy, the valuer only owes a duty of care to the lender and not to you.  That is to say, if the valuer gets it wrong then only the lender, and not you, can do anything about it.

However, in the recent case of Scullion -v- Bank of Scotland plc, the courts have decided that in some circumstances the valuer is liable to the borrower too!

In that case, the buyer of a buy-to-let property suffered a significant loss because the bank's valuer had overstated the value of the property and how much rent the borrower could expect to receive.

The judge said that he had taken into account the following factors :-

1.  That the property was a residential property and not a high value house or commercial property where it might be expected that the borrower would have had a separate survey carried out.

2.  The valuer was a professional valuer who should have known that the borrower would have seen the valuation and would have relied on it.

3.  The borrower was not a professional developer and was no different in that respect from the purchaser of a residential property to live in.

The court awarded the borrower the sum of £72,000.00 to compensate him for the fact that he was not able to let the property for an amount sufficient to cover his mortgage payments.

This is good news for the first time or infrequent property investor whose resources may not stretch to having costly surveys and valuations carried out on standard residential properties, but shouldn't be relied on by professional developers or investors whose resources (and experience) are not limited in the same way.

Beware that casual "just go ahead"email!!

The Court of Appeal has just awarded damages of over £10,000.00 to a firm of estate agents due to a breach by the seller of a property of the agent's sole agency agreement.

The unusual feature of this case is that the agency agreement had been entered into by emails between the seller and the agents.

The agent had sent the seller an email with both their multi and sole agency terms and conditions and the email went on to state that after a certain date the seller would market the property through the agents on a sole basis.

The seller replied with an email which basically said "that's fine, look forward to some viewings".

The property was eventually sold by another agent who had previously been marketing the property on a multi agency basis.  The first agents claimed their fee.

The Seller argued that there was no contract - she said that she had not fully read the e-mail or the sole agency terms and conditions and that it had always been her intention to market the property through several agents.

The Court of Appeal decided that there was a contract brought into being by the exchange of emails and that the sale by the other agent had deprived the sole agent of the chance of earning commission on the sale.  The Court therefore awarded the agent the full amount of its lost commission by way of damages.

The seller therefore effectively paid 2 lots of estate agent's fees and was also landed with a fairly hefty legal bill!

The great thing about email is that it makes instant communication astoundingly easy.  The bad thing about email is that it makes instant communication astoundingly easy!  Be wary about landing yourself with an obligation you never intended just with a quick click on the "Send" button!

Celebration time for Estate Agents?

The Department for Business, Innovation and Skills has announced that it is to consult on a proposal to repeal the Property Misdescriptions Act 1991. (

Under the Act it is an offence for an estate agent to make any statement (usually in the sales particulars) which would mislead a potential buyer or which is simply untrue.

 

The Act covers matters such as location, views from the property, measurements and size of rooms and garden and structural matters.

There is therefore a considerable degree of overlap between the Act and the Regulations - and indeed the powers of Trading Standards under both are very similar.

This has lead to calls for the Act to be scrapped and for customers of estate agencies to rely on their rights under the Regulations instead.

However, whilst the two sets of rules do indeed provide similar protection to consumers, it should be stressed that the protection is not identical, and added to which there has been, over the years, a considerable amount of case law flowing from the Act which gives Trading Standards and the Courts a degree of guidance as to the interpretion of the Act which simply is not available under the Regulations, given that they are relatively new.

We can only hope, if the Act is repealed, that Trading Standards and the Courts will continue to apply the same standards of enforcement which have been available to consumers under the Act.  If not, the days of "compact and bijou" may make a return!

If you would like to have your say on the consultation, it is open until 5th April 2011

If you'd like to comment on this or any of the other posts in the blog, just type it into the box below the relevant post and click the " Post Comment" button.

Limitation on extent of legal privilege confirmed

Confidentiality between client and lawyers is one of the bedrocks of the way the legal profession works and something that clients have always taken for granted (and indeed should be able to!)

One of the rare instances when that confidentiality does not apply quite as clients might expect is the situation in which their lawyer is acting not only for them but also for the mortgage lender in a property transaction - this happens in about 95% of cases.  If mortgage lenders routinely instructed separate lawyers then the costs of buying property would increase significantly and this is why mortgage lenders are happy for the same lawyers to represent their interests and the interests of the buyer.

What happens, though, where for example the buyer ultimately defaults on the mortgage and the mortgage lender requests the lawyer's file?  Many clients assume that the file cannot be released to the mortgage lender because of the confidentiality rules and that even if some papers can be released, then those released are limited to such documents as directly involve the lender.

However, the High Court has now confirmed that borrowers have waived their right to legal professional privilege over those documents in their mortgage files that may otherwise have benefited from that protection. The reason being that the borrower will have signed a mortgage application form which contains a declaration consenting to the whole file being handed over to the lender on request!

The case is a useful reminder to both lawyers and clients that signing a standard form which is as simple as an application for borrowing can have consequences which last well into the future.

Lyn Brisley looks at the new Supreme Court ruling on pre nuptial agreements

Pre-nuptial agreements allow people to ringfence part of their wealth at the outset of a marriage. They are enforceable in many countries but they have never been binding in England and Wales

However, the Supreme Court has ruled that a pre-nuptial agreement is binding in the case of a German paper company heiress.

Katrin Radmacher's ex-husband Nicolas Granatino went to the Supreme Court after appeal judges slashed his divorce settlement from more than £5m to £1m.

The Supreme Court said it agreed that in the right case pre nuptial agreements can have decisive or compelling weight.

The case was seen by lawyers as a test of whether “pre-nup” agreements were applicable in law in England and Wales.

The judges deciding the case said "it will be natural to infer that parties entering into agreements will intend that effect be given to them".

In effect, therefore, these agreements are now binding unless they are unfair. So if the parties enter into a "pre-nup" freely, are fully informed of all the relevant financial and other information, and the implications of the agreement, then the courts will generally uphold the terms of that agreement.

The president of the Supreme Court made it clear, though, that courts would still have the discretion to waive or vary any pre nuptial (or post nuptial) agreement especially in cases where the terms of such agreement would have an adverse effect on any children of the family.

The ruling has been hailed as a judgement for a modern society, but there are some who believe it will significantly damage the financially weaker party in divorce. If that party, normally the wife, is held to the terms of a pre-nup she may be deprived of a considerable chunk of the couple's wealth.

The Law Commission is due to report in 2012 on whether a change in the law should be made to ensure pre-nuptial agreements are fully enforceable.

If you, or anyone you know, needs advice on any pre nuptial agreement then please give Lyn a call on 01733 888841.

"Squatters" beware!

Anyone who continues to believe that  cheekily taking over a piece of their neighbour's land and simply sitting on it and waiting for it to become theirs should take heed of a new ruling by the High Court which has awarded damages of £428,812.29 plus interest, including exemplary (i.e. "we're going to make an example of you") damages of £60,000, against a someone who took part of his neighbour's property into his own with what the court called "reckless disregard of the interests of the true owner".

The award of exemplary damages was made to deter the "squatter" from repeating the same behaviour, as the court felt that the regular award was not a sufficient deterrent.

It's a slightly different scenario from someone taking over an area of land where there appears to be no owner (the "no man's land" scenario) but even so it's something of a wake up call to those people (and they do exist!) who treat land ownership as something of a movable feast.

Saying "No" to mediation - a mistake?

Mediation is an alternative method of resolving disputes, where the parties involved agree to appoint a third party, whose role is to assist them in coming to a settlement.

 

While mediation is not compulsory, the Court have encouraged the use of the same, particularly if the costs involved are considerably less than taking a matter all the way through the Court system. In order to encourage the parties to mediate, they have made it quite clear that if a party refuses to mediate, and they do not have a good reason to do so, then even if they succeed in the case, at trial, then they will not be entitled to recover the costs either in part or in full. In a recent case, where one party refused to mediate for “commercial reasons”, although those reasons were never stated. The Court, when refusing to make a costs order in that case, gave some guidance as to what factors would influence their decision either way namely:

 

• The party refusing mediation must have strong grounds.

 

• Strong grounds do not include that the matter cannot be easily mediated.

• That it can be a good ground to refuse to mediate if you believe you have a strong case. However, if you feel that your case is strong enough, then you would normally be expected to apply to the Court for an early determination of the matter by way of Summary Judgment Application. If you don’t then the Court will probably take the view that you obviously didn’t believe the case was as strong as you say.

 

• It is reasonable to refuse to mediate if sensible and realistic offers have already been made and have been rejected.

 

• It is not good grounds to allege that the parties are so far apart that mediation will not be effective. The whole point of mediation is to bring parties closer together.

 

• Refusing to mediate because of the additional costs that will be incurred is also not good grounds, as the costs of mediation are often less than allowing a matter to go to a fully contested trial.

 

• The burden of showing that the refusal was reasonable lies on the party refusing to mediate.

• If mediation is attempted but fails then no criticism can be raised by the parties because the whole process is confidential.

 

In the circumstances, it would only be in exceptional cases that mediation would not be appropriate. The consequences of refusing to do so can result in you succeeding in your claim but being unable to recover your costs either in part or in full.

New court decision on remedies for right to light infringement

Rights to light and air are not something that the planning process generally takes into account - at least not in the way that those rights are protected in title deeds to property.  It's perfectly possible for a planning authority to grant planning permission only for the property owner not to be able to carry out those works because he finds out that his proposed building works would interfere with the existing light and air to the neighbouring property.

Until now, though, it has always been assumed (especially in relation to commercial property - the courts having always taken a slightly different tack with residential property) that if the neighbour didn't complain about the infringement of his rights before the building work was carried out, his only remedy was to damages for loss of amenity - the view of the courts being that it was unfair to make someone take down a building that was already completed.

However, a recent High Court decision seems to have turned that on its head!

The court awarded an injunction against a developer whose development interfered with the rights of light to a neighbouring commercial property, despite the development having been completed.

In the past, developers may have assumed that they could simply buy rights of light out from the neighbouring land owners after completion of the development if necessary.  It would seem that they must now start to think slightly differently!

Tenants Rights - Changes to the rules

The Civil Procedure Rules are being amended and some of those amendments have consequences for mortgage lenders who have mortgages over tenanted (rather than owner-occupied) property.

In particular the rule changes will allow tenants about whom the lender has no knowledge (that is to say tenants who the property owner has not told the lender about!) who are living in a mortgaged property to apply to the court for postponement of any repossession order granted in favour of the lender.

That obviously has repercussions for lenders being able to sell the property to recover their loan.

The new rules also require lenders to notify tenants and occupiers of a property before taking steps to enforce a possession order.

In those circumstances any tenant who the lender has had no previous knowledge of can apply to the lender for a delay repossession to allow the tenant time to find another home.

If the lender does not agree to an extension of time the tenant may apply to the court for a decision.

At the moment we can only speculate about what effect these changes may have on the willingness of lenders to make mortgage advances to landlords in relation to "buy to let" properties.

Changes to the Building Regulations

The Government has published two new sets of legislation relating to the building control regime in England and Wales.

Many of the changes in the new regulations deal with "tidying up" the current regulations in order to make them easier to understand (we hope!)

In addition, though, there are also some more meaty changes - including the widening of the provisions for self-certification to cover a greater range of activities which deal with the improvement of the energy efficiency of a building.

A proper understanding of the new provisions is vital for anyone who regularly deals with building control issues- especially those businesses whose bread and butter is dealing with construction and property.

The new rules come into force on 1 October 2010, but it may be some while after that before detailed guidance is published.  Until that guidance is forthcoming, anyone seeking clarification on the new regulations will need to look at the government's documentation showing the differences between the 2000 and 2010 regulations.

Buckles seminar and workshop programme

Tomorrow evening (16th September) we are putting on a seminar which will be of interest to landlords regardless of the profile of their property portfolio since it deals with something  which is currently of conern to all landlords - the insolvency of a tenant.

If you would like to attend, or would like further information, please contact Sara Coggins on 01733 888735 or by email at sara.coggins@buckles-law.co.uk

On Thursday 23rd and 30th September the firm's social housing team is running a seminar dealing with issues affecting social landlords.

On 6th October the firm's employment team is running a seminar dealing with the issue of restrictive covenants in employment contracts - an area of law which is a caselaw minefield!

Finally in October, the firm's commecial property team is hosting a much more laid back event - we're going to be indulging in some wine tasting!

If you'd like to attend any of the above seminars or events, or would like to be placed on the firm's mailing lists for future events please contact Sara Coggins (as above!)

Rave Reviews for Buckles!

The independent client's guide to law firms, the Legal 500, published its 2010 edition online yesterday - some really great reviews for the teams here and individuals within those teams!  Check out what the Legal 500 has to say about the firm here - http://tinyurl.com/2wd7hzl

Another Accident at Work story..........

A worker who slipped in flooded toilets has won an undisclosed sum in compensation.


The man worked at a community centre and went to investigate a problem in the toilets. Someone had put the plugs in the washbasins and left the taps running and water had overflowed onto the floor. As he went to turn off the taps, the man slipped and fell, fracturing his elbow.



It emerged that this was not the first time someone had deliberately caused a flood at the premises. There had been a similar incident in another set of toilets at the community centre. However, no action had been taken on the part of the man’s employer to prevent the potential problem, such as removing the plugs or fitting each tap with a flow-limiting device.

The man brought a personal injury claim, but his employer denied liability for the accident. In court, the judge found that the employer had failed to put in place adequate health and safety measures. As well as steps to prevent a recurrence of flooding, there should have been a system in place for making regular checks on the toilets as the community centre was used by members of the public. Also, training should have been provided on how to deal safely with a flooding incident.

Council Tax on Houses in Multiple Occupation

The High Court has just decided (in the case of R (Goremsandu) v London Borough of Harrow)  that the landlord of a house in multiple occupation (HMO) was not liable to pay council tax to the local authority and that the liability remained with the tenants.

 

Given that many local authorities have been actively pursuing landlords for the payment of council tax where tenants have failed to pay, there will be many investors this morning heaving a sigh of relief!

James Maxey says Never Say Never

This week has seen the launch of the mediation website www.mediated-solutions.co.uk and as always when mediation is discussed, inevitably it leads to me being asked by clients and lawyers alike if mediation really works. It is 14 years since I first experienced mediation and the biggest thing that has changed in that time is the increasingly enlightened attitude of clients and lawyers who are finally recognising that, without any sign of weakness, the willingness to sit down with a neutral third party and explore creative solutions to a dispute can actually bring savings of time and money.

“But why do we need a mediator” is the next chirpy comment that emerges. “If we can’t settle it ourselves sitting round the table then a mediator could never settle it”. But this misses the invaluable dynamic a mediator can bring to a settlement meeting.

A mediator is neutral and can talk to the parties without being for or against their case. A mediator is objective and can test the realities. A mediator should be the trusted honest broker. Most importantly, a mediator is confidential and can get into the unique position of fully understanding both of the parties private positions and therefore seeing if there is any overlap.

And the reasons mediations fail?

In my own experience around 90% of mediations result in settlement, and of disputes where I have been appointed as mediator, so far 2010 has a 100% success rate. But the major impediment I usually see is a lack of preparation. It is essential that the clients and their lawyers have spent some serious time thinking about what is actually achievable if they take their case to court and the realistic risks and costs they face. Providing those issues are addressed then a competent mediator stands a very good chance of bringing favourable settlement terms to most disputes. Don’t knock it until you have tried it. And never say never.

Air Rage - it's not just the passengers!

Poor Steven Slater - it all got too much for this experienced member of the Jet Blue cabin crew after a passenger allegedly verbally absued him and opened a storage locker on his head.  Steven gave the lady concerned a rather poor review over the aircraft tannoy and promptly exited the plane via the emergency slide.  You can only wonder just how many other cabin crew the world over have felt like taking the same sort of actions at one time or another!

But air rage is on the increase generally - and it's worth considering that certain behaviour on board an aircraft does carry some hefty crimial penalties.  Even mere "unruly bahaviour" can result in a fine of up to £2,500.00 (making it a pricey old break to the sun!).  The more serious offences - usually involving physical violence - carry a maximum fine of £5,000.00 and up to 2 years residing at Her Majesty's pleasure.  Try getting that absence past HR!

Airlines now have a zero tolerance policy to all these types of behaviour and anyone falling foul will certainly find the local police waiting for them on the tarmac.  There's apparently slightly more tolerance to the joining of the mile high club - though recent passengers on a Dutch flight weren't shown that tolerance given the fact that their club application was made whilst still in their seats!

Impact of the forthcoming VAT increase on SDLT

As everyone is no doubt aware, the standard rate of VAT will increase to 20% with effect from the 4 January 2011.  It has until now been slightly unclear what effect this might have on leases already in existence where VAT is payable on the rent.  Since SDLT is calculated on the VAT inclusive amount of the rent (thanks HMRC - nothing like being taxed on tax eh!!) any change in the VAT rate is theoretically notifable to the Revenue.

The Birmingham Stamp Office has advised that the requirement to review the SDLT calculation for leases with variable or uncertain rent (by virtue of being subject to VAT and there being possible fluctuations in the VAT rate) at the earlier of the end of the fifth year of the term or when the rent for the first five years of the terms becomes ascertained, is modified so that the review date will always fall at the end of the fifth year of the term.

Essentially, what this means that where the rent review date occurs before 4 January 2011, the 4 January 2011 VAT rate increase can be ignored. Only leases granted after 3 January 2006, for which this review date falls on or after 4 January 2011 will need to take the VAT increase into account.

There is a 30 day deadline from that review date to pay any additional SDLT due and file a further return.