December 2011 Archive

Mortgage fraud detection

It is well reported that mortgage fraud has seriously affected numerous well known lenders. Some have publicly declared provisions for losses based on mortgage fraud after full investigations – those lenders are no doubt addressing those losses by third party recoveries. Yet many issues may currently be masked by low interest rates as loans perform, but can other lenders sit tight and hope their books turn out to be (relatively) fraud-free? The FSA thinks not.

Claiming entrepreneurs' relief is not as simple as it seems

Entrepreneurs and key employees within companies need to read the small print before assuming that they are entitled to entrepreneurs’ relief (ER). Failure to qualify for potentially valuable ER could result in them paying 28% Capital Gains Tax rather than 10% on the sale of their business or shares. It is important to note that the ability to claim the relief (and a claim must be made) is subject to a number of strict conditions which can easily catch people out.

Qualifying period for unfair dismissal set to increase

We recently heard from Chancellor George Osborne that the qualifying period for unfair dismissal is set to increase from one year to two years from April 2012. The Chancellor announced that such a reform was necessary to encourage SMEs to recruit, without the fear of finding themselves in the employment tribunal if they subsequently needed to dismiss staff. Shortly after the Chancellor’s announcement, a report on employment law reforms, prepared by venture capitalist Adrian Beecroft and commissioned by the Prime Minister, was leaked to the Daily Mail.

When to use the term 'without prejudice'

We often see ‘without prejudice’ on communications between parties in dispute. The suggestion seems to be that adding that banner to a letter might offer some magical protection down the line if the dispute is not resolved. It doesn’t, but a fuller explanation of the principle of ‘without prejudice’ might be useful. The term is designed to allow parties to negotiate without fear that concessions made will be taken as admissions harming their legal position if the dispute is not resolved.

Money saving ideas for businesses

Some contracts are profitable, and some are not. If you knew what you know now, it is highly unlikely that you would have entered into those unprofitable contracts. We can assist you, at minimal cost, with a legal review of your key contracts to help you save money. Even after you have signed the contract, all is not lost. We have recently helped clients to get key contracts back on track and to save large sums of money on unprofitable contracts.

Interpretation of contracts: Rainy Sky S.A v Kookmin Bank

This case involved a contract in which a shipbuilding company agreed to build and sell one vessel to each of six buyers. The buyers agreed to make pre-delivery payments for the vessel in return for refund guarantees from the shipbuilder’s bank. The shipbuilder experienced financial difficulties and entered into a debt workout procedure under Korean Law. The buyers sought reimbursement of the pre-delivery payments from the bank. The bank refused to pay. The dispute arose out of the interpretation of two clauses within the contract.

Rights against insurers of insolvents

Legislation from 1930 has been overhauled to run far better for claimants whose opponents are insolvent. Third parties have been able to make claims on insurance policies held by insolvent companies or individuals, even when the policy holder has gone away, but the 2010 incarnation of the Third Parties (Rights Against Insurers) Act adds significantly to the ease of claim. The 1930 Act has been used in many ways over the years where the defendant is bankrupt or the business has failed.
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