I read with interest that the Legal Services Board commissioned an ‘economic analysis’ which concluded there was no evidence that referral fees harm consumers. In 2008 we were offered the chance to be on a ‘panel’ for a building society-owned estate agency. The basic premise was that we were to pay £200 per conveyance, of which £100 was kept by the ‘panel manager’ and £100 was paid by the ‘panel manager’ to the building society’s estate agency. We were assured, however, that by the time the various ‘add ons’ were taken into account, their conveyancing fee structure would ensure we made just as much profit. On a typical transaction the scheme was 16% more expensive than Bell Park Kerridge charges. My ‘economic analysis’ was that the clients were paying 16% more, and the solicitor was having to pay £200 to an unnecessary link in the conveyancing chain. Yesterday I read my son’s copy of The Negotiator (28 May 2010), which is a magazine for estate agents. My attention was drawn to an article titled ‘HIPs are gone. Long live HIPs’. The author (the managing director of an estate agency) argued that agents could still market HIPs to certain clients. I quote: ‘But who will pay the HIP fee? There are two opportunities here. First, find a conveyancer or solicitor prepared to advance the pack in exchange for a new client. You may also receive commission. Second, what better way of justifying a rise in your commission level? While the cost of a HIP may represent between 5% and 10% of your commission, if you add in a few other service enhancements, it is surprisingly easy to double your fee if you know how to present your case, thereby making the cost of a HIP a worthwhile investment.’ It costs around £55 for an Energy Performance Certificate, and around £146 for a personal local search and drainage search. If solicitors are prepared to pay around £200 to get work, where the typical fee might only be £400, I have to wonder – what gives? Is the solicitor going to stay in business long? Are there going to be short cuts in the legal work which will lead to claims? Is the solicitor’s independent judgement being compromised? It would appear I am in a minority in finding referral fees to be just plain wrong. However, it is a sizeable minority.Is it time for a split profession, where those who wish to pay referral fees can do so, leaving the remainder to get back to basics and look after clients? James Bell, Bell Park Kerridge, Carlisle
Green-fingered solicitors at Shropshire firm Lanyon Bowdler are celebrating this month after winning the Mike Hough memorial trophy for the best outdoor garden, as well as a gold medal from the Shropshire Horticultural Society. Clients and staff all got stuck in to create the garden, from a plan produced by garden designer Mike Russell. It includes a metal sculpture of a head made of old Land Rover parts and 12 large painted artboards, as well as courgette, cabbage and broccoli plants. The garden was created to support and represent the work of local charity Headway Shropshire, and staff from the charity also contributed to its creation. Clearly Lanyon Bowdler lawyers now have no excuse for not eating their greens.
Local government solicitors at last weekend’s three-day training event in Exeter were in a curiously upbeat mood for a group facing ‘salami-slicing’ cuts of 10% or more to their legal departments’ headcounts. Delegates at the Solicitors in Local Government (SLG) event were told that even those whose jobs survive the cuts will have to start doing more for less, as care applications in children cases climb to their highest-ever level; councils are increasingly challenged for failing in their public equality duties; and many of the thousands of redundant council employees bring tribunal claims for unfair dismissal. But Essex County Council county solicitor Philip Thomson, who heads a legal team of 80 fee-earners and 40 others with an in-house budget of £6m, told the Gazette that the need for cuts should be viewed as a ‘catalyst’ for development. He said: ‘It is not about shrinking the number of staff, but rationalising the work so as to make best use of our lawyers. It is a win-win situation – better career opportunities for our lawyers, and a better service for our clients.’ He added that his team, which made savings of £600,000 last year, has been working with other councils in Essex and neighbouring counties since 2000. On 1 April this year, it rolled out a joint case management system to make sharing services as practical and efficient as possible. ‘Problems can arise with shared services, but we believe we have built up the confidence to work with other councils to best effect,’ Thomson said. However solicitor Paul Cox, one of a team of two solicitors and two legal assistants at Rushcliffe Borough Council, south Nottinghamshire, was less sanguine about budgetary pressures. He said: ‘Any savings from our annual budget of £240,000 will be cutting into the bone, not the fat – because there isn’t any fat to cut.’ Cox said he has no plans yet for partnership with other councils, ‘just local ad hoc reciprocal arrangements, which is better that putting work out to the private sector’. At Slough Borough Council, acting borough secretary, solicitor and monitoring officer Maria Memoli said her team has achieved cuts of £500,000 to legal and democratic services through a range of ‘restructuring’ and other measures. She said: ‘The team has shrunk from 25 lawyers to ten, although some of these were vacancies that we simply did not fill.’ Memoli added that Slough’s legal team has reduced its training spend by mainly attending free sessions only. She is also looking at introducing webinars, which save on travel and time away from the office. ‘We are also part of the ACSeS [Association of Council Secretaries and Solicitors] Call Off scheme, which has negotiated special rates with a number of external firms,’ she added. National firm Weightmans’ head of local government, Graeme Creer, said his team has been advising many local authorities on restructuring. ‘Shared services make obvious economic sense and are one way to address the perennial problem of coping with the peaks and troughs of too much and too little work,’ he said. Creer added: ‘It is less obvious how to sustain a commercial focus and a responsive public service focus at the same time. Local government lawyers’ primary focus has never been to calculate profits over the next six months, but to achieve what the council wants to achieve on behalf of its clients – the general public.’ He anticipated a growing workload for local authority lawyers as grants to voluntary organisations such as citizens advice bureaux are cut, and as councils stop providing or reduce services to the public. He said: ‘Ideally, we would like to help protect local authorities from legal challenges, but decisions to cut services have been made so quickly that corners have been cut and mistakes made.’ Stephen Turner, immediate past chair of SLG, said that his major concern, which formed the ‘bedrock’ of his year in office, was the ‘potential attack on professional standards’ that these enforced cuts represented. He said: ‘The more local authorities are salami-slicing legal services, the closer we come to the day when an individual solicitor has to say no to his employer – or not comply with the ethical standards to which, as an officer of the court, he is bound. ‘The alternative is an appearance before the SRA [Solicitors Regulation Authority] and maybe the SDT [Solicitors Disciplinary Tribunal]. Or if the employer insists that the solicitor acts against the code of ethics, it could mean a claim for constructive dismissal.’ Turner predicted that the cuts in public services would lead to an increase in anti-social behaviour, the trade in counterfeit goods, and environmental and other offences. He said: ‘Council legal departments will not have the resources to police and prosecute these offences with the same rigour as before, which is another unforeseen consequence of the rush to make savings.’ Richard Clayton QC, of London chambers 4-5 Gray’s Inn Square, warned delegates that local government solicitors must be mindful of their public equality duty, even in the face of cuts. He said: ‘The courts say you must do equality impact assessments, so you have to do them. There may be a political decision that leads the council in a certain direction, and there is nothing wrong with that – as long as you have been through the impact assessment process. But remember: very few equality cases brought by consumers have been lost. They are sensitive and judges are reluctant to rule against them.’ The consensus at the weekend was that a range of daunting challenges lies ahead for solicitors in local government. Or, in a more upbeat assessment, Essex County Council’s Philip Thomson said: ‘We are living in exciting times.’
Simon Allen is joint head of the national personal injury department at Russell Jones & Walker and managing partner of the Sheffield office In recent weeks, personal injury practitioners have sadly seen the retirement of Lady Justice Smith, a voice of considerable reason who gave leading judgments on many PI issues. For me she most memorably punctured the many conceits flown by Lord Phillips in his attempt to create a policy decision in the pleural plaques case of Rothwell v Chemical & Insulating Co. Ltd  EWCA Civ 27. Prior to the publication of his report on civil litigation costs, Jackson LJ had given judgment in only a handful of personal injury cases. However, in recent months he has featured with some regularity. One senses he may be stepping into the elegant and experienced shoes of her ladyship. While some might comment that perhaps more exposure to personal injury cases before writing his report could have been of value, it is pleasing to see the gap in his judicial knowledge being filled at this time. Surprisingly, as Jackson LJ was sitting, Tomlinson LJ gave the only judgment in a unanimous court in respect of an appeal by the county council against the finding of a judge at first instance that it was responsible for injuries suffered by the claimant who stumbled and fell while walking across a pedestrianised area known as ‘The Square’, in Beeston town centre in Nottinghamshire. The judgment reminds us of the steps that have to be proven in a Highways Act case. Section 41 of the Highways Act 1980 places a responsibility on the highway authority to maintain the highway. ‘Maintenance’ includes repair. The law in this area is clearly stated in a previous judgment of the Court of Appeal (Mills v Barnsley Metropolitan Borough Council  PIQR 291) and, in particular, in the judgment of Steyn LJ. The three factors the claimant has to prove are: i) That the highway was in such condition that it was dangerous to traffic or pedestrians in the sense that, in the ordinary course of human affairs, danger may reasonably have been anticipated from its continued use by the public; ii) The dangerous condition was created by the failure to maintain or repair the highway; andiii) The injury or damage resulted from such a failure. The appeal court made it quite clear that the highway authority did not have to provide ‘a bowling green’ level surface free of irregularities. Once the claimant has proved these three factors, then a section 58 defence may arise. This compels the authority to show that it has, in all the circumstances, taken such care to secure that the part of the highway to which the action relates was not dangerous for traffic. In looking at the defence, the court will consider a number of factors including the character of the highway, the appropriate standard of maintenance, the state of repair that a reasonable person would have expected, whether the highway authority knew that the condition of the highway was likely to cause danger and whether, if a repair could not have been expected in a short duration, warning notices of its condition had been properly displayed. In Mrs Dalton’s case, the court found that the offending part of the highway consisted of a loose and wobbling paving block that caused her to overbalance and fall. The block was ‘loose, unstable, wobbling, proud of its neighbours and, moreover, its height relative to its neighbours was capable of being altered’. The judges made it clear that this was not a simple case of a difference in level between 2 adjacent surfaces. His lordship stated: ‘One does not expect the structure under foot to be shifting in nature.’ This was the key to the case. The claimant was also aided by the fact that the defendant had graded the repair as a ‘category 1’ type. His lordship held that: ‘Where a council has an inspection and maintenance regime being couched in terms of the identification of an immediate or imminent hazard, the identification by the council of defects so defined is obviously powerful evidence of the presence of a danger against the risk of which the council can reasonably be expected to take steps to safeguard the public.’ This is a critical point. The defendant’s documentation must be obtained and analysed in respect of how it categorises the repair, as the Appeal Court properly advises that the higher the categorisation the faster the repair ought to be completed. In this instance it was understandable that the defendant had so categorised the defect in that it was in the main square in the centre of town and received high pedestrian and vehicular usage. ‘Members of the public… should not expect to find paving stones in a main square loose.’ This hazard went beyond merely a tripping hazard. The fact that the block could move made the risk of a pedestrian stumbling far greater. The defendant’s assessment of the defect simply underlined the need for swift action. Responsibility for the highway Dalton v Nottinghamshire County Council  EWCA Civ 776 Lady Justice Smith After the decision in Carver v BAA  EWCA Civ 412, there has been much confusion and much litigation in respect of the consequences of part 36 of the Civil Procedure Rules. In this case, Jackson LJ gave the lead, and only, judgment in a unanimous court. The claimant suffered injury in an accident in 2003 during the course of his employment, as a result of which he suffered a disc prolapse in his lumbar spine. In April 2008 he submitted a schedule of loss, claiming damages of £280,000. In September 2008 the defendant made a CPR part 36 offer to settle in the sum of £63,000 gross. This offer was subsequently withdrawn and a new offer of £31,702 was made. Video evidence was disclosed showing the claimant able to walk normally and with generally good mobility. Medical experts for the claimant and defendant, while not in agreement, limited the accident-related symptoms to a period of two years and one year respectively. The case settled in the sum of £31,702 against the net part 36 offer of £23,550. The judge at first instance held that the defendant was the successful party and ordered the claimant to pay the defendant’s costs in respect of the period following the later CPR part 36 offer. On appeal, the defendant conceded that the claimant should be regarded as the successful party. Therefore, as his lordship pointed out, the claimant should recover his costs from the other side pursuant to rule 44.3(2)(A) of the CPR. The next step is to consider whether there should be any adjustment to the costs order to reflect issues on which the successful party has lost, or other circumstances. At this point, his lordship’s apparent exasperation with the post-Carver situation is evident. His view is that unless a claimant has been dishonest, he should recover his costs. The fact that the claim had been exaggerated from a schedule claiming £280,000 to an ultimate settlement of £31,702 was of no consequence. The defendant could have made a modest part 36 offer if they had wished to do so. This would have provided them with some costs protection. His lordship found that there is now an ‘unwelcome trend’ resulting in ‘a swarm of appeals to the Court of Appeal about costs, of which this case is an example’. His expectation is that the ‘forthcoming amendment to rule 36.14 will point the way to a more clear-cut approach to the costs rules in future’. It will rid part 36 of the accumulated authorities that have disguised its original intention to provide a clear and simple framework within which parties can settle litigation. We should, therefore, look forward to the introduction of the amended rule on 1 October 2011. Part 36 of the CPR and inflated claims for damages Fox v Foundation Piling Limited  EWCA Civ 790 Hufton v Somerset County Council  EWCA Civ 789. The claimant was a pupil at the defendant’s school. She suffered an injury to her knee when slipping on water on the wooden floor of the assembly hall when re-entering the building during the morning break. While it was not raining at the commencement of the break period, it did so approximately seven minutes later. The claimant’s case was that the school negligently permitted its pupils to walk directly into the assembly hall thus depositing water on the floor of the assembly hall. The defence alleged that on wet days pupils were not permitted to enter the school hall in the manner of the claimant, and that prefects were positioned by the fire exit doors to prevent this happening. They had a system whereby if it was raining a sign was placed by the doors to that effect. Unfortunately, on the day of the accident, while there was no rain at the commencement of the break period, there was during it, and the claimant managed to enter the building before the steps mentioned above were taken to prevent such access. The defendants could show that a risk assessment had taken place. Lord Justice Jackson, giving the only judgment in a unanimous decision, rejected the appeal of the claimant from the dismissal of her case by the judge at first instance. He underlined that there is not an absolute duty on the part of an occupier to prevent any accident from ever occurring on their premises. In this instance the court would not interfere with the trial judge’s finding that a reasonable system was in place to prevent access to the hall floor in wet weather. Furthermore, his lordship rejected the second strand of the claimant’s appeal – that the defendants had been negligent in failing to clear up the wet floor before the claimant stepped on it. They cited Ward v Tesco Stores Limited  1WLR 810, a leading case in which the Court of Appeal found for the claimant against the supermarket primarily on the basis that the yoghurt on which she slipped was one of approximately 10 spillages a week that occurred on the floor of the particular store. The school had had the floor in place for many years and, since the risk assessment, a period of six years had passed without a similar incident. Ward did not assist the claimant.
Lawyers have paid tribute to departing Legal Services Commission (LSC) chief executive Carolyn Downs, following the announcement that she is leaving to take up a senior role in local government. Downs took over as chief executive of the LSC in March 2010 on secondment from the Ministry of Justice, following the resignation of Carolyn Regan. She will join the Local Government Association as chief executive within the next three months, replacing interim chief executive, John Ransford. Downs has considerable experience in local government, having been chief executive of Shropshire County Council from 2003 to 2009, before her appointment as deputy permanent secretary and director general of corporate performance at the MoJ. Lawyers’ groups which have had their differences with the LSC during Downs’ tenure agreed that she had performed well in challenging circumstances. In tandem with its legal aid reforms, the government plans to make the LSC an executive agency of the Ministry of Justice, appointing a director of casework to head the agency and make funding decisions on behalf of the secretary of state. Law Society chief executive Des Hudson said Downs had developed a good understanding of the legal aid system and was always willing to engage with the profession. ‘While at times we had significant disagreements with the LSC, we recognised the difficult challenges facing Carolyn and the LSC,’ he said. ‘Her departure at a time of such substantial change represents a very unfortunate loss of expertise.’ Legal Aid Practitioners Group director Carol Storer also commended Downs for her ability to work with practitioners, and expressed concerns about who would succeed her. ‘With difficult times ahead we want to see someone appointed who understands the legal aid system and is willing to work closely with practitioners and representative bodies to try to ensure that the remaining rump of legal aid services will be effective,’ said Storer.
Nicholas Vineall QC (instructed by Wikborg Rein LLP) for the claimant; Christopher Hancock QC and Malcolm Jarvis (instructed by Akin Gump LLP) for the defendants. In August 1995, P 36, a semi-submersible oil production platform (the vessel) was delivered to her owners. However, the owners were unable to employ the vessel and they accordingly allowed a company, Maritima, to negotiate a sale to a third party. Much of Maritima’s work was undertaken for the first defendant, ‘Petrobras’, the Brazilian state petroleum company. Negotiations began in 1996 between the parties with a view to creating a scheme to upgrade the vessel and deploy it in the South Marlim oil field, off the coast of Brazil. The specification which was finally submitted (the South Marlim GTS) was subsequently amended. The amendments were set out in a document called ‘Annex X’. The South Marlim GTS was a generic specification applicable to all Petrobras production platforms to be used in South Marlim. At meetings between Maritima and Petrobras in July 1996, a possible deviation for gas compression was discussed. In the event, a modified gas compression system was approved (the compression deviation) (see  of the judgment). A memorandum of agreement (the MOA) was signed in November 1996 between Maritima and Petrobras. The agreement contemplated that Maritima would acquire the vessel with a view to upgrading it and transferring title to the second defendant, ‘Brasoil’, a wholly-owned subsidiary of Petrobras, under a 12-year bareboat charter with a purchase option at the end of the period. Brasoil would in turn make the vessel available for use by Petrobras under a bareboat charter. Towards the end of 1996, however, a very large new oilfield, subsequently known as the Roncador field, was discovered. Petrobras wished to bring the new field into production before the Brazilian state monopoly was ended and thus a new proposal emerged to put the vessel into service at Roncador. It transpired that substantial changes would need to be made to the design of the upgraded platform for use at Roncador owing to the different conditions there. The financing of the project involved a number of different bodies and a complex contractual structure. Essentially, the parties comprised Maritima and the first claimant, Petromec, its contracting party, on the one hand; and Petrobras and Brasoil on the other. In August 1998, the parties entered into a supervision agreement. Clause 12.1 of that agreement provided that: ‘In consideration of Petromec’s agreement to upgrade the Vessel in accordance with the Amended Specification Brasoil agrees to pay to Petromec an amount equal to the reasonable extra cost (if any) to Petromec of Upgrading the Vessel in accordance with the Amended Specification over and above the cost that Petromec might reasonably have incurred in Upgrading the Vessel in accordance with the Original Specification.’ Discussions continued as to the funding for the additional costs generated by the Roncandor variation. In the event, the vessel was released to Petrobras to leave its berth in the St Lawrence river and be dry towed to Brazil. Petromec issued proceedings to recover the balance of the amount which it claimed was due in respect of the additional costs generated by the Roncador project pursuant to clause 12.1 of the supervision agreement. Brasoil and Petrobras made a claim for damages for delay in the completion of the upgrade. It was agreed that the compression deviation represented the finally agreed Annex X deviation in respect of the compression system for the purpose of clause 12.1 of the supervision agreement. The court ordered the trial of preliminary issues, including the legal effect of the MOA. On 2 February 2004, the court made rulings on the preliminary issues (see  All ER (D) 10 (Feb)). Amongst the rulings made was that ‘cost’ in clause 12.1 of the supervision agreement did not include a profit element but conferred an entitlement on Petromec to recover not only the direct costs but also the whole of the additional costs, including financing costs, incurred as a result of the change in the nature of the project. That ruling was upheld by the Court of Appeal on 15 July 2005 (see  All ER (D) 209 (Jul)). On 16 June, Petromec’s claim that statements made by Petrobras during an attempt to agree a global payment approach to the notional South Marlim costs had been made fraudulently were dismissed (see  All ER (D) 184 (Jun)). Further preliminary issues arose arising out of Petromec’s revised particulars of claim formulated in the light of the various judgments. The preliminary issues included first, the meaning and effect of the provision in Appendix B of the supervision agreement in relation to how the cost that Petromec might reasonably have incurred in upgrading the vessel was to be assessed with regard to the gas compression system (see  of the judgment). That issue raised the further question as to whether any further costs that would arise out of Petrobras’ compression systems’ specification, such as additional deck space and gas processing equipment, were allocated by the compression deviation to Petrobras’ account rather than to Petromec’s account. Secondly, whether Petromec was expected to install a spider deck similar to that installed for Roncador or could Petromec have utilised ‘risers’ (conduits that moved the fluids and services vertically between a floating production facility projecting above the sea surface and the sea-bed) (see  of the judgment). The court ruled: (1) It was well established that in construing any contractual provision, the object of the court was to give effect to what the contracting parties had intended. To ascertain the intention of the parties the court had to read the terms of the contract as a whole, giving the words used their natural and ordinary meaning in the context of the agreement, the parties’ relationship and all the relevant facts surrounding the transaction so far as known to the parties. To ascertain the parties’ intentions the court did not inquire into the parties’ subjective states of mind but made an objective judgment based on the materials already identified (see  of the judgment). The question posed in the first issue was one of contractual construction. In the instant case, the compression deviation was intended to operate as a cost allocation provision. The meaning and effect of the compression deviation when construed against the relevant background was that, apart from Petromec having to supply the existing compressor and one new 2,000,000 m3/d gas compression train, the whole of the cost of acquiring, installing and accommodating such further compression systems, including additional deck space and processing equipment, as might be specified by Petrobras to meet its compression requirement of 6 million m3/d, was for Petrobras’ account (see , ,  of the judgment). Investors Compensation Scheme Ltd v West Bromwich Building Society  All ER (D) 23 applied; BCCI SA (in liquidation) v Ali  All ER (D) 153 (Jul) applied. (2) In the instant case, Petromec could not reasonably have had to install a spider deck, the same as or similar to that installed for Roncador. Instead, Petromec could reasonably have used the central caisson for the attachment of 52 risers with the remaining 46 being wet-attached to the pontoons (see  of the judgment). Petromec Inc v Petroleo Brasileiro S.A. Petrobras and another company: Queen’s Bench Division, Commercial Court (Mr Justice Field): 17 November 2011 Construction – Contractual term – Commercial sense
The government is putting together an expert panel to examine the case for introducing a new offence of ‘drug driving’. The initiative, by the Department for Transport, will bring together academics and scientific experts in alcohol and drug misuse, the Home Office and Department of Health. The panel will look at how an offence of driving with an illegal drug in your body could be defined, as well as considering whether it is possible to set levels for the impairing effects of specific drugs, including cocaine, MDMA, cannabis and opiates. It will also examine whether impairment levels could be exceeded through prescribed or otherwise legally obtained drugs, as well as the effects of the interaction of drugs and alcohol and of different combinations of drugs. The move follows the recommendations in the 2010 review of the drink and drug driving law by Sir Peter North. Currently police have to prove that a driver’s actions have been impaired by the use of drugs. The new offence would remove the need for this where drugs were present beyond the lawful level. The road safety minister, Mike Penning, said: ‘Britain has some of the safest roads in the world but we know how important it is to tackle the menace of drug driving. That is why we are putting together a panel of experts to give us advice on the technical aspects of introducing a new offence of driving with an illegal drug in your body.’
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Subscribe now for unlimited access To continue enjoying Building.co.uk, sign up for free guest accessExisting subscriber? LOGIN Stay at the forefront of thought leadership with news and analysis from award-winning journalists. Enjoy company features, CEO interviews, architectural reviews, technical project know-how and the latest innovations.Limited access to building.co.ukBreaking industry news as it happensBreaking, daily and weekly e-newsletters Get your free guest access SIGN UP TODAY Subscribe to Building today and you will benefit from:Unlimited access to all stories including expert analysis and comment from industry leadersOur league tables, cost models and economics dataOur online archive of over 10,000 articlesBuilding magazine digital editionsBuilding magazine print editionsPrinted/digital supplementsSubscribe now for unlimited access.View our subscription options and join our community
Get your free guest access SIGN UP TODAY Stay at the forefront of thought leadership with news and analysis from award-winning journalists. Enjoy company features, CEO interviews, architectural reviews, technical project know-how and the latest innovations.Limited access to building.co.ukBreaking industry news as it happensBreaking, daily and weekly e-newsletters To continue enjoying Building.co.uk, sign up for free guest accessExisting subscriber? LOGIN Subscribe now for unlimited access Subscribe to Building today and you will benefit from:Unlimited access to all stories including expert analysis and comment from industry leadersOur league tables, cost models and economics dataOur online archive of over 10,000 articlesBuilding magazine digital editionsBuilding magazine print editionsPrinted/digital supplementsSubscribe now for unlimited access.View our subscription options and join our community