When it comes to making a Will, it is quite likely that you will think long and hard about whom you wish to inherit your home, your money and your personal possessions. However, have you ever considered whom you would like to benefit from your digital assets which can include: films, videos, music, e-books and Apps which now are more frequently being stored with the assistance of on-line ‘Cloud’ services.
Recent research carried out by the Centre for Creative and Social Technology (CAST) at the University of London for their ‘Cloud Generation’ report found that just over 1 in 10 of 2,000 British people surveyed had included, or planned to include, internet passwords in their Wills in a trend that CAST have labeled ‘Digital Inheritance’.
With more and more of our data being saved on-line by making use of services run by remote computers, known as ‘Clouds’, rather than being saved direct to a PC, this is an area which is likely to increase over the coming years. However, unfortunately, it is also open to abuse should your security passwords fall into the wrong hands!
Tom Lawrence, Partner and Head of the Wills and Probate Team at Rogers & Norton, said “The reliance placed by most of us on all things technological is showing no signs of slowing down. I am finding more often that clients are looking for sensible solutions to protect on-line assets for themselves and their families in the future. This can be as simple as keeping an up-to-date schedule of internet passwords and usernames with their Will, which can then be stored securely”.
If you would like to discuss this article, or any other matter relating to Wills, Trusts, and Estate Planning, please contact Tom Lawrence on 01603 675610, or e-mail tl@rogers-norton.co.uk.
Tuesday, October 18, 2011
Friday, October 14, 2011
The pitfalls of owning property jointly with another
The law is “double-Dutch”: Geoffrey Boycott
The pitfalls of owning property jointly with another
This week has seen former England cricketer and well-known Yorkshireman, Geoffrey Boycott, appear at the High Court in London expressing his view that the law surrounding joint ownership of property is unclear. Mr Justice Vos hearing the case himself acknowledged the “obscurity” of property law which dates back 300 years.
The case centres around Boycott’s purchase in 1996 of a three-bedroomed property overlooking Poole Harbour in the millionaires’ resort of Sandbanks, Dorset. The property was purchased for £450,000 and earlier this year was valued at £3 million. Boycott purchased the property with his then partner, Anne Wyatt, and it was put into their joint names as ‘joint tenants’. When property is owned as joint tenants upon the death of one owner their half share will automatically pass to the other. This is commonly referred to as the ‘rule of survivorship’. This type of joint ownership is usually preferred by married or cohabiting couples as it provides security on death for the surviving spouse/partner which is particularly important where there are children of the family.
The alternative to owning a property as joint tenants is to own it as ‘tenants in common’. As a tenant in common it is open to you to make provision in your Will for your share to pass on your death to a third party. In the absence of a Will the rules of Intestacy apply which may result in your share passing to one or more prescribed family members which may not be what you want. For example, if you remain married your share could pass to your spouse, even if you are separated.
Purchasing a property as joint tenants is not unchangeable. It is open to variation by either owner. By serving a ‘Notice of Severance’ upon a joint owner it can be changed to a ‘tenancy in common’, giving one party the option of leaving their half share to a third party under the terms of their Will in the event of their death.
This fact came as somewhat of a shock to Geoffrey Boycott when, in 2009 on the death of his former partner, he discovered that she had two years earlier unilaterally changed the joint ownership to a tenancy in common and had bequeathed her half share of the property to her niece. It is Mr Boycott’s case that he and Ms Wyatt had agreed that upon their deaths their respective shares would pass to the other. He says that had he known that the ownership could be altered he would never have bought the property with Ms Wyatt, who had continued to live in the property rent-free.
To change the ownership of a property from a joint tenancy to a tenancy in common one party must ‘serve’ upon the other a Notice of Severance in accordance with section 36(2) of the Law of Property Act 1925. Section 196 of that Act sets out the method of ‘service’ which essentially means sending a written document to the co-owner at their last known home or business address. It need not be acknowledged by the co-owner.
In Mr Boycott’s case, in which he is making a claim against his solicitors who dealt with the purchase, he claims that it was a “huge surprise” to him to discover on Ms Wyatt’s death that she had unilaterally changed the ownership of the property to a tenancy in common and had left her share to her niece.
This case highlights the importance of fully understanding the implications of owning property jointly with another, particularly in the event of the death of one party or the breakdown of the relationship.
If you require advice regarding financial and property matters as a result of the breakdown of your relationship or protecting your assets when entering into marriage or a relationship then please contact Sophie Key or Amy Walpole in our Matrimonial Department on 01603 675648 or email matrimonial@rogers-norton.co.uk.
If you would like to discuss the preparation of a Will then please contact Tom Lawrence or Louisa Mawbey in our Private Client Department on 01603 666001 or email web@rogers-norton.co.uk.
If you are purchasing a property in joint names and require a conveyancer and advice in relation to joint ownership then please contact Hayley George in our Residential Conveyancing Department on 01603 675623 or email hlg@rogers-norton.co.uk.
The pitfalls of owning property jointly with another
This week has seen former England cricketer and well-known Yorkshireman, Geoffrey Boycott, appear at the High Court in London expressing his view that the law surrounding joint ownership of property is unclear. Mr Justice Vos hearing the case himself acknowledged the “obscurity” of property law which dates back 300 years.
The case centres around Boycott’s purchase in 1996 of a three-bedroomed property overlooking Poole Harbour in the millionaires’ resort of Sandbanks, Dorset. The property was purchased for £450,000 and earlier this year was valued at £3 million. Boycott purchased the property with his then partner, Anne Wyatt, and it was put into their joint names as ‘joint tenants’. When property is owned as joint tenants upon the death of one owner their half share will automatically pass to the other. This is commonly referred to as the ‘rule of survivorship’. This type of joint ownership is usually preferred by married or cohabiting couples as it provides security on death for the surviving spouse/partner which is particularly important where there are children of the family.
The alternative to owning a property as joint tenants is to own it as ‘tenants in common’. As a tenant in common it is open to you to make provision in your Will for your share to pass on your death to a third party. In the absence of a Will the rules of Intestacy apply which may result in your share passing to one or more prescribed family members which may not be what you want. For example, if you remain married your share could pass to your spouse, even if you are separated.
Purchasing a property as joint tenants is not unchangeable. It is open to variation by either owner. By serving a ‘Notice of Severance’ upon a joint owner it can be changed to a ‘tenancy in common’, giving one party the option of leaving their half share to a third party under the terms of their Will in the event of their death.
This fact came as somewhat of a shock to Geoffrey Boycott when, in 2009 on the death of his former partner, he discovered that she had two years earlier unilaterally changed the joint ownership to a tenancy in common and had bequeathed her half share of the property to her niece. It is Mr Boycott’s case that he and Ms Wyatt had agreed that upon their deaths their respective shares would pass to the other. He says that had he known that the ownership could be altered he would never have bought the property with Ms Wyatt, who had continued to live in the property rent-free.
To change the ownership of a property from a joint tenancy to a tenancy in common one party must ‘serve’ upon the other a Notice of Severance in accordance with section 36(2) of the Law of Property Act 1925. Section 196 of that Act sets out the method of ‘service’ which essentially means sending a written document to the co-owner at their last known home or business address. It need not be acknowledged by the co-owner.
In Mr Boycott’s case, in which he is making a claim against his solicitors who dealt with the purchase, he claims that it was a “huge surprise” to him to discover on Ms Wyatt’s death that she had unilaterally changed the ownership of the property to a tenancy in common and had left her share to her niece.
This case highlights the importance of fully understanding the implications of owning property jointly with another, particularly in the event of the death of one party or the breakdown of the relationship.
If you require advice regarding financial and property matters as a result of the breakdown of your relationship or protecting your assets when entering into marriage or a relationship then please contact Sophie Key or Amy Walpole in our Matrimonial Department on 01603 675648 or email matrimonial@rogers-norton.co.uk.
If you would like to discuss the preparation of a Will then please contact Tom Lawrence or Louisa Mawbey in our Private Client Department on 01603 666001 or email web@rogers-norton.co.uk.
If you are purchasing a property in joint names and require a conveyancer and advice in relation to joint ownership then please contact Hayley George in our Residential Conveyancing Department on 01603 675623 or email hlg@rogers-norton.co.uk.
Wednesday, October 5, 2011
R&N Business Workshops
Rogers and Norton solicitors are delighted to announce an Autumn series of practical workshops, providing a guaranteed 100 top tips for you and your business. Each workshop will last for 1 hour commencing at 4.30 pm, and will be followed by light refreshments.
Tuesday 1 November 2011: Being Prepared for difficult times in business and the Rogers and Norton Survival Guide.
Our speakers will discuss issues ranging from employment contracts to contracts with your suppliers and customers, key terms of business, business opportunities, cash flow and dealing with HMRC.
Tuesday 8 November 2011: Tips to Recover Bad Debts
Following on from our 1st workshop, we will highlight some practical debt recovery points and how to use the insolvency process as a tool to recover bad debts, to include suing directors personally of debtor companies personally. Our workshop will also look at Retention of Title claims.
Tuesday 22 November 2011: Directors Liabilities and Duties - how to stay out of trouble!
In these difficult times, it is expected that more claims will be made against directors. We have seen an increase in claims for unlawful dividends (some going back to 2004), breach of duties and in Directors Disqualification Proceedings. In this workshop, we will update you on your duties and liabilities as directors and company secretaries, and the transactions and management issues that Insolvency Practitioners investigate together with the Insolvency Service.
Tuesday 29 November 2011: Employment Update
As the year comes to an end, our specialist employment Partner Phil Kerridge will provide a practical list of employment issues arising from 2011 and predict the potential changes in 2012. This will be a must attend session for HR Managers and directors.
Tuesday 13 December 2011: Construction Act - the new one!
Our last session for 2011 will focus on the key changes to the Act and early developments, together with an update on other developments relating to letters of intent, experts and ADR. The session will be aimed at Employers, Contractors, Developers, Architects, Surveyors and Consultants.
Please complete the online booking form here to reserve your place(s).
In 2012, we will be holding seminars on Buying and Selling a Business, Intellectual Property Rights (exploiting and protecting), Company Law and Property updates. Please also add any additional workshops and seminars you would like us to hold.
We look forward to seeing you at our workshops.
Tuesday 1 November 2011: Being Prepared for difficult times in business and the Rogers and Norton Survival Guide.
Our speakers will discuss issues ranging from employment contracts to contracts with your suppliers and customers, key terms of business, business opportunities, cash flow and dealing with HMRC.
Tuesday 8 November 2011: Tips to Recover Bad Debts
Following on from our 1st workshop, we will highlight some practical debt recovery points and how to use the insolvency process as a tool to recover bad debts, to include suing directors personally of debtor companies personally. Our workshop will also look at Retention of Title claims.
Tuesday 22 November 2011: Directors Liabilities and Duties - how to stay out of trouble!
In these difficult times, it is expected that more claims will be made against directors. We have seen an increase in claims for unlawful dividends (some going back to 2004), breach of duties and in Directors Disqualification Proceedings. In this workshop, we will update you on your duties and liabilities as directors and company secretaries, and the transactions and management issues that Insolvency Practitioners investigate together with the Insolvency Service.
Tuesday 29 November 2011: Employment Update
As the year comes to an end, our specialist employment Partner Phil Kerridge will provide a practical list of employment issues arising from 2011 and predict the potential changes in 2012. This will be a must attend session for HR Managers and directors.
Tuesday 13 December 2011: Construction Act - the new one!
Our last session for 2011 will focus on the key changes to the Act and early developments, together with an update on other developments relating to letters of intent, experts and ADR. The session will be aimed at Employers, Contractors, Developers, Architects, Surveyors and Consultants.
Please complete the online booking form here to reserve your place(s).
In 2012, we will be holding seminars on Buying and Selling a Business, Intellectual Property Rights (exploiting and protecting), Company Law and Property updates. Please also add any additional workshops and seminars you would like us to hold.
We look forward to seeing you at our workshops.
R&N
Tuesday, October 4, 2011
George Osborne announces Employment Law Reforms
The Government yesterday announced the two key changes that they intend to introduce to encourage employers to recruit new staff with effect from April 2012. Firstly, the intention is to increase the period of continuous service required to bring an unfair dismissal claim from one to two years. Secondly, fees are to be introduced for the issuing of Tribunal claims. Both of these have been widely predicted for several months.
Whether either of these changes is likely to have the desired effect is debatable according to the Firm’s Head of Employment Law, Phil Kerridge.
“Based on previous statistics, the increase of the period from one to two years will effect about 5% of cases, so on the face of it that reduction is not as significant as you might expect.
Set against that, it has to be remembered that the increase will have no bearing on discrimination cases, which will continue to have no requirements for any continuity of service. Bearing in mind the recent abolition of the default retirement age, I can see a significant increase in age discrimination claims, so I am not convinced that what has been proposed will be sufficient to stimulate employers into recruiting new staff.
Whether the payment of a fee will deter potential claimants remains to be seen, although it should certainly discourage the more speculative claims.”
If you wish to discuss the proposed changes or any other employment law issue, please contact Phil on 01603 675603 or at pnk@ogers-norton.co.uk. If you wish to subscribe to Phil’s monthly newsletter, please click here.
Whether either of these changes is likely to have the desired effect is debatable according to the Firm’s Head of Employment Law, Phil Kerridge.
“Based on previous statistics, the increase of the period from one to two years will effect about 5% of cases, so on the face of it that reduction is not as significant as you might expect.
Set against that, it has to be remembered that the increase will have no bearing on discrimination cases, which will continue to have no requirements for any continuity of service. Bearing in mind the recent abolition of the default retirement age, I can see a significant increase in age discrimination claims, so I am not convinced that what has been proposed will be sufficient to stimulate employers into recruiting new staff.
Whether the payment of a fee will deter potential claimants remains to be seen, although it should certainly discourage the more speculative claims.”
If you wish to discuss the proposed changes or any other employment law issue, please contact Phil on 01603 675603 or at pnk@ogers-norton.co.uk. If you wish to subscribe to Phil’s monthly newsletter, please click here.
Tuesday, September 27, 2011
Top Legal Directory praises expanding Rogers & Norton
Rogers & Norton has gained major recognition in this year’s edition of the Legal 500 for its high quality service and expertise.
The Legal 500 is acknowledged as the most widely used legal directory in the country, in which law firms are ranked in terms of their skills and performance.
Rogers & Norton was founded in 1982 and is now a 12 Partner firm with more than 60 fee earners and support staff.
Rogers & Norton’s Commercial Litigation Team continues to flourish with John Cadywould, Peter Hastings and Phil Kerridge all receiving substantial recognition for having valuable experience and expertise, excellent tactical awareness, and are helpful and quick with advice. The recent expansion of the Team has seen the appointment of Jenna Phillips, who specialises in debt recovery.
Phil Kerridge, Head of the firm’s Employment Team, also gains recognition for offering pragmatic and practical advice to a strong base of employer clients.
Peter Hastings, described as an immense talent, is an expert in Directors’ disqualification cases and acts for most local Insolvency Practitioners. Peter has recently advised administrators on a £1.1 Million HMRC Excise Duty back claim and also a contractor’s £1.75 Million claim for fees following the termination of a project.
The firm’s Personal Injury and Clinical Negligence Team continues to strengthen their reputation both locally and far beyond. Mark Hambling, who is a Senior Litigator with the Association of Personal Injury Lawyers and a Personal Injury accredited specialist with the Law Society, and Tim Nobbs, are praised as being notably conscientious, with a practice spanning employers’ liability, public liability and RTA claims. Tim and mark are noted to have handled claims involving failed diagnosis in radiology, inadequate surgery, death in hospital and failed vasectomy.
The excellent, professional and compassionate advice of Amy Walpole, Partner and Head of the firm’s Family Team, is acknowledged. The team has expanded to include recently-appointed experienced Solicitor Sophie Key who has a strong expertise in children matters. Together they handle a stream of high-value divorce and cohabitee work. Amy is also a trained collaborative lawyer.
Newly-promoted Partner and Head of the Private Client Team, Tom Lawrence, and Catherine Hawdon, who are both members of the Society of Trust and Estate Practitioners, are noted for being technically up-to-speed, prompt with good business acumen and a pleasant demeanour. The Private Client Team continues to grow with the recent appointment of experienced Solicitor Louisa Mawbey. It is noted that four lawyers in the team are members of the Solicitors for the Elderly.
The Corporate and Commercial Team has again impressed with Richard Etheridge, the firm’s Managing Partner, at the helm. Richard is noted as being very approachable and constructive whilst delivering a high quality of service on corporate issues. The firm’s recent work includes company buy-backs, restructurings and the MBO of a local manufacturing firm.
The one-stop service offered by Bruce Faulkner, who heads the Commercial Property Team, continues to thrive in dealing with the sale, purchase and licensing of premises, including pubs and clubs around Norwich. Bruce is noted as having handled leases, including a 9,000 sq ft property in a prestigious office block in Norwich.
Meanwhile the Residential Property Team, headed by the well known and liked Marc Greig has seen a continued increase in good quality instructions which is bucking the trend of many of the firm’s competitors. Marc enjoys an enviable reputation with local builders and developers for his work. The firm continues to advise local businesses, landowners, public limited companies and pension schemes. The Property Team has increased in size, with the appointment of three new members.
The 2011 edition (published online at: www.legal500.com) highlights Norwich-based Rogers & Norton’s impressive credentials for providing expert legal advice to clients – regionally, nationally and internationally.
Richard Etheridge, Managing Partner and Head of the firm’s Corporate and Commercial Team, says “We are thoroughly delighted that, yet again, Rogers & Norton has received significant recognition for the calibre of its work and first-rate service. In what are undoubtedly tough economic times, we are encouraged by the fact that we have been able to further expand upon our already very talented team of lawyers. I think it goes to show that our commitment to offering a top quality service to our clients at reasonable cost is the right approach”.
He adds “Every year I have been at Rogers & Norton has been exciting and this year has proved to be no exception! Over the past 12 months we have been able to significantly strengthen our Property Team and increase the depth of our already highly experienced Private Client and Family Teams, whilst also promoting from within, which is always very encouraging. I am confident that 2012 will see us continuing to move further in the right direction”. Rogers & Norton was founded in 1982 and is now a 12 Partner firm with more than 60 fee earners and support staff.
Rogers & Norton’s Commercial Litigation Team continues to flourish with John Cadywould, Peter Hastings and Phil Kerridge all receiving substantial recognition for having valuable experience and expertise, excellent tactical awareness, and are helpful and quick with advice. The recent expansion of the Team has seen the appointment of Jenna Phillips, who specialises in debt recovery.
Phil Kerridge, Head of the firm’s Employment Team, also gains recognition for offering pragmatic and practical advice to a strong base of employer clients.
Peter Hastings, described as an immense talent, is an expert in Directors’ disqualification cases and acts for most local Insolvency Practitioners. Peter has recently advised administrators on a £1.1 Million HMRC Excise Duty back claim and also a contractor’s £1.75 Million claim for fees following the termination of a project.
The firm’s Personal Injury and Clinical Negligence Team continues to strengthen their reputation both locally and far beyond. Mark Hambling, who is a Senior Litigator with the Association of Personal Injury Lawyers and a Personal Injury accredited specialist with the Law Society, and Tim Nobbs, are praised as being notably conscientious, with a practice spanning employers’ liability, public liability and RTA claims. Tim and mark are noted to have handled claims involving failed diagnosis in radiology, inadequate surgery, death in hospital and failed vasectomy.
The excellent, professional and compassionate advice of Amy Walpole, Partner and Head of the firm’s Family Team, is acknowledged. The team has expanded to include recently-appointed experienced Solicitor Sophie Key who has a strong expertise in children matters. Together they handle a stream of high-value divorce and cohabitee work. Amy is also a trained collaborative lawyer.
Newly-promoted Partner and Head of the Private Client Team, Tom Lawrence, and Catherine Hawdon, who are both members of the Society of Trust and Estate Practitioners, are noted for being technically up-to-speed, prompt with good business acumen and a pleasant demeanour. The Private Client Team continues to grow with the recent appointment of experienced Solicitor Louisa Mawbey. It is noted that four lawyers in the team are members of the Solicitors for the Elderly.
The Corporate and Commercial Team has again impressed with Richard Etheridge, the firm’s Managing Partner, at the helm. Richard is noted as being very approachable and constructive whilst delivering a high quality of service on corporate issues. The firm’s recent work includes company buy-backs, restructurings and the MBO of a local manufacturing firm.
The one-stop service offered by Bruce Faulkner, who heads the Commercial Property Team, continues to thrive in dealing with the sale, purchase and licensing of premises, including pubs and clubs around Norwich. Bruce is noted as having handled leases, including a 9,000 sq ft property in a prestigious office block in Norwich.
Meanwhile the Residential Property Team, headed by the well known and liked Marc Greig has seen a continued increase in good quality instructions which is bucking the trend of many of the firm’s competitors. Marc enjoys an enviable reputation with local builders and developers for his work. The firm continues to advise local businesses, landowners, public limited companies and pension schemes. The Property Team has increased in size, with the appointment of three new members.
Tuesday, August 30, 2011
R&N Newsflash: Construction Act 2009 - Good News or Bad ?
Here it is at last, the “Construction Act 2009” will come into force on the 1 October 2011. Is it good news or bad news?
Let’s start at the beginning! It will apply to all construction contracts that are entered into on or after this date, and brings significant changes to the current regime in respect of payment and adjudication. Will it stop disgruntled parties running off to the Technology and Construction Court on matters of law in an attempt to delay payment? Will the cash flow? That’s the idea.
The introduction of this new legislation follows an extensive period of consultation by the Government on how to improve payment practices in the construction industry. It is therefore imperative that you are aware of the changes that are contained in the Construction Act 2009 and how it will affect your business.
Adjudication
There are mixed views on Adjudication. The intention of Adjudication was to keep projects and cash flowing. Yet, the TCC was busy dealing with issues on whether all material terms were recorded in writing, and of course other arguments. The main change that will impact on adjudication is that the scope of the Construction Act has been widened to include oral contracts, thereby removing jurisdictional challenges based on contracts not being in writing, or evidenced in writing. Is this a step in the right direction? I am not convinced, even allowing for the fact that Adjudicators are experienced and quite often senior barristers. I expect that there will be further disputes in proving that an oral contract exists, and what terms were agreed by the parties, and by whom.
Payment
We now have a Payment Notice, which should state the amount to be paid, and the basis for its calculation. There is no sanction if the paying party fails to issue the payment notice. This has now changed. If the party making payment (referred to as the “Payer”) fails to issue a payment notice within 5 days of the due date, then the application for payment may serve to be the payment notice by default. In this case, the payer will have to pay the notified sum, as contained in the application by the final date for payment.
We will also have a “pay less notice” in lieu of a withholding notice, which has to be served by the payer before the final date for payment. The content of a pay less notice requires careful consideration. The pay less notice allows the payer the opportunity to give notice of his intention to pay less than the notified sum, and must be served within a prescribed period before the final date for payment. Here, the payer must specify the amount he considers is due on the date the pay less notice is served. This affords the payer a second opportunity to value the works, whereas previously he could only notify the amount he intended to withhold from the amount due under the contract.
All parties will need to have terms of payment, understand them and then follow them! Good news or bad?!
Suspension rights
Under the old Act, a party could walk off site in the event of non-payment, subject to serving the correct notices. There were many cases on whether the contract had been repudiated. The threat often worked!
The Construction Act 2009 gives additional rights in respect of suspending the work for non-payment. These additional rights mean that the contractor now has the right to suspend part or all of his obligations under the contract, not just all. If the contractor elects to suspend the works, the contractor is now entitled to the payment of a reasonable amount in respect of costs and expenses he incurs as a result of the suspension.
Who does this Affect?
Employers, subcontractors, consultants all need to take action now. We all need to understand the new rules and revise procedures. Contracts need to be updated. Standard forms must comply. And this applies to Consultants too.
Actions
Have a written contract and understand and follow the terms. But, we all know, construction projects are not perfect. There will be sub-contracts, variations, extras and other terms not in writing. Take minutes of meetings, circulate them, use email to record an agreement, use standard forms where parties can tick boxes to confirm an action. Letters of Intent will help avoid such issues, but ensure their scope is limited, capped in value and include key terms.
There will be problems and I expect an initial flurry of litigation. My view is that it is a step in the right direction, although I am not convinced on adjudicating oral contracts! Do you think it has gone far enough? Residential contracts anyone?
For further information on the Construction Act 2009 and any construction issues, contact Peter Hastings 01603 666001 or ph@rogers-norton.co.uk.
Let’s start at the beginning! It will apply to all construction contracts that are entered into on or after this date, and brings significant changes to the current regime in respect of payment and adjudication. Will it stop disgruntled parties running off to the Technology and Construction Court on matters of law in an attempt to delay payment? Will the cash flow? That’s the idea.
The introduction of this new legislation follows an extensive period of consultation by the Government on how to improve payment practices in the construction industry. It is therefore imperative that you are aware of the changes that are contained in the Construction Act 2009 and how it will affect your business.
Adjudication
There are mixed views on Adjudication. The intention of Adjudication was to keep projects and cash flowing. Yet, the TCC was busy dealing with issues on whether all material terms were recorded in writing, and of course other arguments. The main change that will impact on adjudication is that the scope of the Construction Act has been widened to include oral contracts, thereby removing jurisdictional challenges based on contracts not being in writing, or evidenced in writing. Is this a step in the right direction? I am not convinced, even allowing for the fact that Adjudicators are experienced and quite often senior barristers. I expect that there will be further disputes in proving that an oral contract exists, and what terms were agreed by the parties, and by whom.
Payment
We now have a Payment Notice, which should state the amount to be paid, and the basis for its calculation. There is no sanction if the paying party fails to issue the payment notice. This has now changed. If the party making payment (referred to as the “Payer”) fails to issue a payment notice within 5 days of the due date, then the application for payment may serve to be the payment notice by default. In this case, the payer will have to pay the notified sum, as contained in the application by the final date for payment.
We will also have a “pay less notice” in lieu of a withholding notice, which has to be served by the payer before the final date for payment. The content of a pay less notice requires careful consideration. The pay less notice allows the payer the opportunity to give notice of his intention to pay less than the notified sum, and must be served within a prescribed period before the final date for payment. Here, the payer must specify the amount he considers is due on the date the pay less notice is served. This affords the payer a second opportunity to value the works, whereas previously he could only notify the amount he intended to withhold from the amount due under the contract.
All parties will need to have terms of payment, understand them and then follow them! Good news or bad?!
Suspension rights
Under the old Act, a party could walk off site in the event of non-payment, subject to serving the correct notices. There were many cases on whether the contract had been repudiated. The threat often worked!
The Construction Act 2009 gives additional rights in respect of suspending the work for non-payment. These additional rights mean that the contractor now has the right to suspend part or all of his obligations under the contract, not just all. If the contractor elects to suspend the works, the contractor is now entitled to the payment of a reasonable amount in respect of costs and expenses he incurs as a result of the suspension.
Who does this Affect?
Employers, subcontractors, consultants all need to take action now. We all need to understand the new rules and revise procedures. Contracts need to be updated. Standard forms must comply. And this applies to Consultants too.
Actions
Have a written contract and understand and follow the terms. But, we all know, construction projects are not perfect. There will be sub-contracts, variations, extras and other terms not in writing. Take minutes of meetings, circulate them, use email to record an agreement, use standard forms where parties can tick boxes to confirm an action. Letters of Intent will help avoid such issues, but ensure their scope is limited, capped in value and include key terms.
There will be problems and I expect an initial flurry of litigation. My view is that it is a step in the right direction, although I am not convinced on adjudicating oral contracts! Do you think it has gone far enough? Residential contracts anyone?
For further information on the Construction Act 2009 and any construction issues, contact Peter Hastings 01603 666001 or ph@rogers-norton.co.uk.
Wednesday, July 20, 2011
R&N Employment Newsletter
Rogers & Norton are pleased to announce the launch of its free “e–employment newsletter”, which goes live this month. The newsletter will come out ten times per year and is designed to provide general updates that are aimed at HR officers and owners and directors of SME businesses alike.
If you have not yet subscribed to the newsletter and would like to do so, please complete the sign up form by clicking the following link : http://www.topica.com/f/v.html?1700160817.1700102567.
If you require more specific advice on either the contents of the newsletter or any other aspect of employment law, please contact Phil Kerridge on 01603 675603 or email pnk@rogers-norton.co.uk.
ROGERS & NORTON
If you have not yet subscribed to the newsletter and would like to do so, please complete the sign up form by clicking the following link : http://www.topica.com/f/v.html?1700160817.1700102567.
If you require more specific advice on either the contents of the newsletter or any other aspect of employment law, please contact Phil Kerridge on 01603 675603 or email pnk@rogers-norton.co.uk.
ROGERS & NORTON
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