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Herbert Smith Freehills LLP

Herbert Smith Freehills LLP

Francesca Ruddy analyses a recent case examining the relationship between costs budgeting and costs awarded

A number of costs assessments had been put on hold pending the outcome of the appeal in Harrison v University Hospitals Coventry & Warwickshire NHS Trust [2017], which was referred directly to the Court of Appeal from the Senior Courts Costs Office on a ‘leapfrog’ basis.

Andrew Taggart, Anna Henderson and Hannah White examine the long-awaited final regulations and draft guidance introducing gender pay gap reporting for large companies

Almost two years after the Small Business, Enterprise and Employment Act 2015 was passed enabling gender pay gap reporting to be introduced, the final form regulations were at last approved by Parliament at the end of January and come into force on 6 April this year. Private sector employers with 250 or more employees will need to take their first snapshot of pay data on 5 April 2017 and publish it no later than 4 April 2018. Similar requirements (not covered by this article) apply to public sector employers, but with a first snapshot date of 31 March 2017. On 29 January 2017, Acas and the Government Equalities Office (GEO) jointly published non-statutory guidance (stated to be in draft pending parliamentary approval for the regulations, but no substantive changes are expected).

Maura McIntosh summarises a currency-sensitive judgment

When assessing the costs to which a German claimant was entitled on having succeeded in its patents claim in the English High Court, the court in Elkamet Kunststofftechnik GmbH v Saint-Gobain Glass France SA [2016] has awarded an additional sum of £20,000 to compensate for the claimant’s exchange rate loss on payments to its solicitors, particularly in light of the significant fall in the value of sterling against the euro since the EU referendum result.

In the second of two articles, Chris Parker, Gregg Rowan and Nick Pantlin look at the judicial implication of a duty of good faith

Part one: 'Keeping the faith', POJ33, November/December 2016

In Yam Seng Pte Ltd v International Trade Corp Ltd [2013], the High Court took what is arguably a novel approach in implying a duty of good faith into an ordinary commercial contract, purporting to apply normal principles governing contractual interpretation and the implication of terms. The judge referred to the two traditional criteria for implying a term into a contract, namely whether the term is:

Maura McIntosh reports on a recent application of the Mitchell sanction

In the recently reported case of Jamadar v Bradford Teaching Hospitals NHS Foundation Trust [2016], Jackson LJ delivered the leading judgment dismissing an appeal against the imposition of the so-called Mitchell sanction where a party failed to file a costs budget when required to do so, so that he was treated as having filed a budget limited to court fees.

In the first of two articles, Chris Parker, Gregg Rowan and Nick Pantlin help readers to navigate obligations of good faith in commercial contracts

The traditional starting point in English contract law is that parties are free to do what they like so long as they do not breach the agreed terms. But it is becoming increasingly common for parties to agree terms requiring them to act in ‘good faith’, or similar. Even where no such term is expressed in the contract, courts and tribunals are increasingly being asked to imply good faith obligations.

Three new decisions have shed further light on the impact of different types of leave on holiday pay, reports Tara Grossman

Although holiday pay forms a relatively low percentage of a worker’s overall annual pay, the complexity in this area and plethora of EU and domestic case law is keeping HR professionals and employment lawyers very busy. Busy enough that we all deserve a holiday. The questions that this area of law raises seem to be endless – how is holiday pay calculated and should commission and overtime be included? What about guaranteed, non-guaranteed and voluntary overtime? Does a worker’s entitlement to holiday pay continue to accrue during sick leave and other types of leave (garden leave, sabbaticals, career breaks)? Can workers carry over holiday if they are unable to take it in the current year due to sickness? These issues do not tend to be raised as an everyday matter but as part of a wider dispute with an employee (for example one on long-term sickness absence) or with a union.

Patel v Mirza [2016] establishes a flexible approach towards the illegality defence. Gareth Keillor and Rosanna Pinker analyse the pros and cons

It has been established for almost 250 years that ‘no court will lend its aid to a man who founds his cause of action upon an immoral or an illegal act’ (Holman v Johnson [1775]). However, the courts have been grappling ever since with the extent to which this maxim applies and precisely what it means. While public policy considerations have always underpinned this defence, the 1993 House of Lords decision in Tinsley v Milligan [1995] introduced a new ‘reliance test’, effectively putting to one side considerations of public policy and instead focusing on whether the claimant is required to rely on their illegality in order to establish their claim. The decision in Tinsley has been much criticised and has ushered in a prolonged period of uncertainty and division regarding the correct approach to the defence. Conflicting approaches by the Supreme Court in cases such as Allen v Hounga [2014] and Les Laboratoires Servier & Anor v Apotex Inc [2014] have left this area of law in a state of confusion and disarray, and created what has been described as a ‘schism’.

Sarah Boland considers a recent ruling on the UCTA unreasonableness test

The High Court has found that the requirement of reasonableness imposed by the Unfair Contract Terms Act 1977 (UCTA) can apply in circumstances where a party’s written standard terms and conditions are incorporated only in part and other terms are tailor-made: Commercial Management (Investments) Ltd v Mitchell Design and Construct Ltd [2016].

Tom Henderson reports on a recent Supreme Court decision reformulating the test for when a claim will fail due to illegality

The Supreme Court has established a new approach to the question of whether a defendant will be able to rely on the defence of illegality: Patel v Mirza [2016].

Gareth Keillor and Rosanna Pinker consider the lack of clarification from the Supreme Court on the illegality defence

The application of the illegality defence, otherwise known as the ex turpi causa non oritur action principle, has long been a means of preventing claimants from relying on their illegal actions to initiate a claim against another party. In essence, the defence relies upon an argument that a claim should not be allowed to succeed where the claimant has been involved in illegal conduct that is connected to the claim. In the context of trusts law, shareholder disputes and fraud, the defence of illegality has been repeatedly raised by defendants and dealt with by the court, though not always consistently.

Maura McIntosh reports on a recent Court of Appeal decision on Part 36 and split costs orders

The Court of Appeal has overturned an order depriving a claimant of part of her costs where she had beaten her own Part 36 offer: Webb v Liverpool Women’s NHS Foundation Trust [2016].

Anna Pertoldi reports on two recent cases concerning the enforcement of foreign judgments

Two recent High Court decisions have shown how difficult it is to resist enforcement of a foreign judgment in England by relying on matters which were, or could have been, raised in the original court. They also show that the English court will give careful consideration to whether any of the limited defences to enforcement apply, and will not allow them to be used as an indirect route to challenge the original court’s findings: Superior Composite Structures LLC v Parrish [2015] and Smith v Huertas [2015].

Annabel Gillham, Andrew Taggart and Hannah Lau consider whether the draft gender pay gap regulations are fit for purpose and whether they will act as a catalyst for private sector litigation

The government recently published the draft Equality Act 2010 (Gender Pay Gap Information) Regulations 2016, together with a short consultation document for which responses were required by 11 March 2016. Final regulations are expected by this summer, to come into force from October 2016. Large private and voluntary sector employers must take a snapshot of pay data in April 2017 and publish it within 12 months (by 30 April 2018). The reporting obligations will be extended to the public sector in due course.

Anna Pertoldi and Maura McIntosh look back at some of the key developments of 2015 from the perspective of the commercial litigator in England and Wales

As we move into a new year, this article examines some of the significant legal decisions during 2015.

Maura McIntosh explores a recent judicial interpretation of Part 36

The High Court has held that an offer to settle was not a valid Part 36 offer since it related only to a claim put forward in draft amended particulars of claim: Hertel v Saunders [2015].

The ECJ has recently considered when the special employment jurisdiction rules in the Brussels Regulation will apply to claims against directors. Andrew Taggart, Anna Pertoldi and Donny Surtani consider the implications

In Holterman Ferho Exploitatie BV v Spies von Büllesheim [2015], the European Court of Justice (ECJ) has considered a number of jurisdiction questions that are relevant to companies both when drafting contracts of employment and considering claims against directors. It may also be relevant in the context of shareholder agreements.

Stephen Wisking, Kim Dietzel and Molly Herron provide an overview of the new UK competition litigation regime

On 1 October 2015 the Consumer Rights Act 2015 (CRA 2015) came into force, putting into effect a major overhaul of the competition litigation regime in the UK.

Emily Russell and Andrew Taggart outline a recent case on whether US or EU law applied to an employment dispute

In July 2015, the Court of Appeal considered a number of difficult issues which regularly arise in a cross-border employment context (James Petter v EMC Europe Ltd [2015]).

Nusrat Zar and Rachel Lidgate investigate a recent judicial assessment of a tender evaluation

In Woods Building Services v Milton Keynes Council [2015], the court held that a disappointed bidder should have outscored the winning bidder in a public procurement exercise, based on the adjusted scores awarded by the court.

Gregg Rowan and Daniel Woods consider a recent case on repudiatory breach

In a recent decision, the Court of Appeal held that the deliberate withholding of payments due under a contract, in circumstances where the counterparty could expect to receive payment eventually, did not amount to a repudiatory breach so as to entitle the counterparty to terminate the contract: Valilas v Januzaj [2014].

Employers must be wary how they communicate their intentions to the workforce in light of a recent ruling, warn Annabel Gillham and Jemima Coleman

Employers engaging in consultation with their employees will invariably seek to explain the rationale for their proposals in some detail; this is partly to ensure that the consultation is meaningful (to comply with statutory requirements) but also to get employees to buy-in to the new proposal. The employer may well feel compelled to give some assurance that the proposals will provide stability, continued viability for the business or some other future benefit.

Maura McIntosh outlines a recent decision of Lord Justice Jackson on extensions of time

In a judgment handed down on 20 May 2014, Lord Justice Jackson has taken the opportunity to clarify the effect of his reforms on extensions of time: Hallam Estates Ltd v Baker [2014]. Jackson LJ referred to his recommendation that the court should be ‘less tolerant than hitherto of unjustified delays and breaches of orders’ and that this change should be signalled by amendment of CPR 3.9 which governs applications for relief from sanctions. That, he said, remains his firm view. He welcomed the fact that the recommendation has been implemented, leading to a new and more disciplined approach to the conduct of civil litigation. He added, however:

Maura McIntosh reports on a recent decision in the Commercial Court

In what may be seen as a surprising decision, the Commercial Court has treated service of particulars of claim on the defendant’s lawyer by e-mail as valid service, despite the fact that the lawyer had not agreed to accept service by e-mail and in any event the purported service was five days late. The court held that the case fell within CPR 3.10, which provides that an error of procedure does not invalidate any step in the proceedings unless the court so orders: Integral Petroleum SA v SCU-Finanz AG [2014].

Maura McIntosh highlights a recent case limiting witness evidence

In what appears to be the first High Court decision applying the court’s new express powers to limit factual witness evidence, the court has restricted the number of witnesses that may be called by a claimant in relation to particular issues in a personal injury claim: MacLennan v Morgan Sindall (Infrastructure) plc [2013].

Tara Grossman and Nick Wright examine proposals to reform the UK’s workplace whistleblowing regime

In the wake of recent scandals in both the public and private sectors, the government is again looking at whether the UK’s statutory whistleblowing regime is fit for purpose. Building on the significant changes made to the regime in June 2013 (most notably the removal of the ‘good faith’ requirement and the introduction of the ‘public interest’ test), the reforms now being mooted can be divided into two categories:

Maura McIntosh reviews on a recent decision dealing with costs sanctions and Part 36

In the first case we have seen addressing the new costs sanction introduced by the Jackson reforms for claimants’ Part 36 offers made on or after 1 April 2013, the High Court has declined to order the new sanction: Feltham v Bouskell [2013].

Peter Frost examines the impact on employment lawyers of the latest attempt to make civil litigation cheaper

The Jackson reforms can be seen as a continuation of a process that started with Lord Woolf’s review of the civil litigation process in the 1990s. Litigation was then seen as too lengthy, complex and costly. Lord Woolf brought in a number of changes that were embodied in the new Civil Procedure Rules in 1999, chiefly the introduction of judicial case management. However, while cases now run faster (in fact considerably faster than a number in the employment tribunals), the consensus is that they have not become much cheaper. Jackson LJ was therefore appointed in November 2008 to ‘have another go’ at achieving this, with the avowed objective of promoting access to justice at ‘proportionate’ cost.

Anna Pertoldi and Maura McIntosh look at judicial views on compliance

The changes brought in on 1 April 2013 to implement the Jackson reforms included two that received comparatively little attention before the ‘Big Bang’ date but have been quick to make their mark post-implementation.

In its second ruling on the point in two months, the EAT has decided that post-termination victimisation remains unlawful after all, reports Hannah White

In Onu v Akwiwu [2013], the Employment Appeal Tribunal (EAT) reached a decision that contrasts with its earlier ruling in Rowstock Ltd v Jessemey [2013] when considering whether the Equality Act 2010 provides a remedy for post-employment victimisation. This article considers the apparent position under the Equality Act following the turnaround in Onu, and contrasts it with the position under the pre-Equality Act legislation.

Business rates mitigation schemes are under increasing scrutiny from the courts. Martin Dawbney and Frances Edwards explain

Business rates continue to make headlines with stories such as ‘Business rates have turned high streets into cash cows for Government’ (Retail Week, 21 May 2013), epitomising the antagonism of many businesses, particularly retailers on struggling high streets, to a taxation system that many consider to be flawed. The government’s unpopular decision to delay the next revaluation of properties for an additional two years until 2017, maintaining valuations that were last undertaken in 2008 at the height of the property market, has also created outrage within the property industry and among many retailers.

Jasveer Randhawa and Natacha Heffinck discuss the government’s proposals on judicial review and the effect they would have within the planning sector

In December 2012, the government launched a public consultation, which outlined a number of proposals to reform the judicial review process in the UK. The proposals were aimed at remedying various problems arising out of the current judicial review framework, such as delays, costs being added to public services and, in some cases, the stifling of innovation and frustration of much needed reforms (such as those aimed at stimulating growth and promoting economic recovery).

Matthew Bonye and Julia Morgan weigh up the implications for the real estate sector of the decision in R (on the application of Prudential plc) v Special Commissioner of Income Tax.

The Supreme Court handed down judgment in late January, in a long-running tax dispute confirming that legal advice privilege (LAP) is restricted to confidential communications between a client and a qualified solicitor (including in-house lawyers), barrister or foreign lawyer in R (on the application of Prudential plc) v Special Commissioner of Income Tax [2013].

Jemima Coleman and David Smail consider the key findings of the government’s response to its ‘Modern Workplaces’ consultation and highlight potential practical difficulties

On 13 November 2012, the government published its long-awaited response to its ‘Modern Workplaces’ consultation, over 12 months after the consultation closed in August last year. The proposal is to extend the right to request flexible working to all employees and introduce a new system of flexible parental leave. The Children and Families Bill has not yet been published but a draft bill is expected in 2013, with the new regime in force in 2014.

Neil Warriner discusses a case with lessons for taxpayers

Despite their reversal in the DV3 case, involving a sub-sale of property into a limited partnership (see DV3 RS Ltd Partnership v HMRC [2011]), HMRC has just struck back with victory in relation to a sub-sale of property into a distribution in specie in the recent case of Vardy Properties and Vardy Properties (Teesside) Ltd v HMRC [2012].

Anna Pertoldi and Maura McIntosh consider a recent decision on protection of confidential information

In Generics (UK) Ltd v Yeda Research & Development Co Ltd [2012], the Court of Appeal has considered whether, and in what circumstances, a former employed lawyer will be restrained from acting adverse to a former employer in order to protect that former employer’s confidential information. This is a decision that may have far-reaching consequences for professionals and their employers alike.

Martin Dawbney and Frances Edwards looks at the outcome of two recent decisions that will come as welcome relief to ratepayers

Business rates and, particularly, the extremely unpopular rates charged on empty property, have attracted considerable press coverage over recent weeks. Ratepayers have been turning to rating surveyors and lawyers to help them to reduce their liabilities for rates. Two recent cases, although dealing with different aspects of the rating regime, illustrate that trend.

Joanna Mason and Sinead Clancy assess a recent High Court judgment which considered the extent to which liability to provide early-retirement benefits transfers on a private business sale

In a recent case, the High Court considered, for the first time, the scope of the so-called ‘Beckmann and Martin ’ rights to early-retirement benefits which transfer on the sale of a business under the transfer of undertakings legislation. The extent to which liability to provide these benefits transfers to the buyer in a business sale has been a long-standing point of uncertainty in private UK mergers and acquisitions. This article explains the background to Beckmann and Martin rights, summarises the key points from the High Court’s judgment in The Procter & Gamble Company v Svenska Cellulosa Aktiebolaget SCA & anor [2012] and considers the practical implications arising from the case.

Anna Condliffe considers the implications of Unison v NHS Wiltshire Primary Care Trust

The High Court has rejected an application by the trade union Unison for judicial review to challenge a decision to outsource family health services but held that it was possible for a third party to obtain judicial review of public procurement decisions where that third party could show a ‘sufficient interest’.

Jemima Coleman considers the next steps in the government’s proposed overhaul of employment legislation

The Queen’s Speech on 9 May 2012 gave employment lawyers an insight into the likely legal framework for the government’s proposed employment law reforms. Three new bills are of particular interest to employment lawyers:

John Adams outlines the implications of SuDS on the development process

The government has proposed that the provisions of Schedule 3 of the Flood and Water Management Act 2010 come into force on 1 October 2012. This will require the inclusion of sustainable drainage as part of any development.

Jemima Coleman and Katie Russell weigh up the steps companies can take to improve female representation at board level without committing unlawful positive discrimination

Gender diversity at board level is an important issue politically, socially and economically. It has been reported that companies with strong female representation at board level and top management level perform better than those without.

Patrick Mitchell and Matthew Warren discuss recent trends and developments in the UK infrastructure sector

Despite the recent downturn and uncertainty in the European markets, investment in both mature and ‘greenfield’ infrastructure assets in the UK continues to be an attractive option. While deal activity in the sector has generally been quiet, the UK government has made strong statements, including by David Cameron immediately prior to the recent Budget, that it sees infrastructure increasingly as one of the key drivers for the UK’s economic recovery, both in the short and long term. One of the main pillars of this initiative is the government’s push to make the sector more attractive and ‘investable’ for private sector investors from the UK and overseas.

Jemima Coleman and Justine Reeves look at overseas workers’ right to bring a complaint in the UK employment tribunal, using the example of a posting to the UAE to examine the legal and practical issues involved

Increasing labour mobility and growing numbers of multinational companies operating across borders make it is essential for employment lawyers to understand the international aspects of employment law.

Graeme Robertson reviews the implications of the Land Registration Act 2002 and its implications on squatters and landowners

Adverse possession is an area of property law that most landowners would hope to have little or no dealing with, if they are aware of it at all. At its most fundamental level, it is counter-intuitive, particularly in England and Wales where private property-owning rights have always been kept as nigh on sacrosanct. The adverse possession regime challenges this idea: it allows a lawful owner of property to be deprived of his title by an interloping third party who has given no value for it. This challenge is arguably inconsistent with the modern concept of owner-centric property law, which is now enshrined in the Human Rights Act 1998 (although it should be noted that the current adverse possession regimes have been held by the ECHR to be convention-compliant).

Julian Copeman and Heather Gething look ahead to the Prudential appeal

On 13 October 2010 the Court of Appeal handed down judgment in R v Special Commissioner of Income Tax [2010] dismissing Prudential’s appeal against the High Court’s refusal to extend legal professional privilege (LPP) to tax law advice given by accountants. The ruling confirmed that LPP does not apply, at common law, to any professional other than a qualified lawyer, ie a solicitor or barrister or an appropriately qualified foreign lawyer.

Recent rulings seem set to make it easier to carry out post-transfer harmonisation of employees’ terms, report Andrew Taggart and Francesca Lopez

Following a business transfer, the incoming employer (the transferee) will commonly want to vary the employment terms of its newly acquired employees to bring them into line with those of its existing workforce. However, reg 4(4) of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) states that unless the outgoing employer (the transferor) is subject to insolvency proceedings, any purported variation of an employee’s contract will be void if the sole or principal reason for that variation is:

Ilana Swimer analyses the growing use of anonymity and restricted reporting orders in the employment tribunal

Rights enshrined in the European Convention on Human Rights (ECHR) are increasingly relevant to employment law. We have seen the right to freedom of expression (article 10 ECHR) cited in a whistleblowing case ( Heinisch v Germany [2011]) and in an unfair dismissal claim relating to an employee’s publication of an offensive cartoon in a trade union newsletter ( Palomo Sanchez v Spain & ors [2011]).

James Farrell, Michael Mendelblat and Emily Lew explore a spate of recent case law relating to expert determination

Expert determination remains an important mechanism for the resolution of certain property disputes. The following cases provide an overview of the issue of jurisdiction.

Anne Sammon looks at the latest moves aimed at increasing the number of women in senior positions in UK and European companies

In February, Lord Davies published his report, ‘Women on Boards’ (the Davies Report), setting out his recommendations on how to increase female participation on corporate boards. This suggested that, rather than setting quotas, listed companies should have targets for the numbers of women on their boards. While this may have reassured employers who were concerned about the imposition of quotas, recent actions at a European level suggest that, unless there is a significant increase in the number of women at board level, quotas may be forced onto them through European legislation.

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