Website Update for Business Law by Ewan MacIntyre
January 2006
1.5.2The European Court of Human Rights
In M v UK (Application No 6638/03) the European Court of Human Rights unanimously held that the UK had violated Article 14 of the ECHR, in conjunction with Article 1 of the first Protocol, by giving tax deductions to married fathers whilst not giving them to unmarried fathers.
6.1.1. Misrepresentation
Peekay Intermark Ltd v ANZ Banking Group Ltd [2005] EWHC 830 Comm considered the position where a person has false representations made to him but then signs a document, without reading it, which contradicts these false representations. It was held that the rule in L'Estrange v Graucob did not prevent an actionable misrepresentation from having been made.
6.2.2 Mutual mistake
South East Windscreens Ltd v Jamshidi [2005] EWCH 3078 found a contract to be void for mutual mistake as there was no consensus ad idem. A business had been bought and the two sides had different views of exactly what had been agreed. Their views did not coincide and it was not possible objectively to say what had been agreed. So neither had proved, on a balance of probabilities, that their view was correct and so there was no agreement.
7.2.6 Rectification
In ZF Lemforder Ltd v LemforderUK Pension Trustee Ltd [2005] EWHC 2882 Ch the High Court ordered rectification of a pension scheme because both parties had intended that the scheme's definition of 'pensionable pay' should include something which was not intended to be included.
1.5.3Motor vehicles on hire-purchase
In GE Capital Bank Ltd v Rushton [2005] EWCA 1556 a person who had never worked as a motor dealer bought several cars from a motor dealer with the intention of selling them at a profit. The Court of Appeal held that he was not a private purchaser for the purpose of s.27 HPA 1964.
12.2.5 Loss of a chance
In Leonard Batty v Danaher 2005 EWCH 2763 an employee who received negligent advice from a solicitor was awarded damages for the loss of a chance. The claimant was suspended from work and he indicated that he wanted to return to work. His solicitor received two letters from his employer saying he should return but didn't notice them. The employee didn't return to work and consequently lost his entire remuneration deal. The High Court awarded him 70% of the value of the remuneration deal because there would have been a 70% chance that he would have got it.
12.2.6.1 Contributory negligence
In Beryl Badger v Ministry of Defence [2005] EWHC 2941 an award to a widow in respect of her husband's death from lung cancer was reduced by 20% because he had not given up smoking despite warnings that this was harming his health. The husband had died at 63. Exposure to asbestos at work was the main cause of death, but smoking was a contributory factor.
12.6 Time limits
In Aer Lingus v Gildacraft Ltd and Another The Times 23 January [2006] the Court of Appeal held that a joint tortfeasor who was seeking a contribution under the Civil Liability Contribution Act had to start his action within two years of the amount of damages being quantified, rather than within two years of liability being established.
13.3 Rylands v Fletcher
LMS International Ltd v Styrene Packaging Ltd [2005] EWHC 2065 is an interesting case in which a manufacturer of expanded polystyrene, who allowed a fire to escape from the premises, was liable under the rule in Rylands v Fletcher as well as in negligence and nuisance. The manufacturer had brought a dangerous thing on to his land, and it was clear that if this material caught fire the fire would be likely to spread. Cambridge Water Company v Eastern Counties Leather was applied and British Gas plc v Stockport MBC was distinguished.
13.8 Vicarious liability
In Viasystems Ltd v Thermal Transfer Ltd and Darwell Ltd Lawtel 2006 the Court of Appeal found two employers vicariously liable for the negligence of one employee, as both of them could have prevented the employee's negligent act.
In Hawley v Luminar Leisure Ltd [2006] EWCA Civ 18 a nightclub was held vicariously liable for a doorman who assaulted a customer. The doorman had been supplied under a contract to provide security services. The nightclub was the doorman's "temporary deemed employer" because it had detailed control not only of what he did but also of the way in which he did it.
15.8.3. Liability by holding out
In Elite Business Systems UK Ltd v Huw Price [2005] EWCA Civ 920 a father opened a bank account, in his own name, for his son's business to use. The son ordered about £100,000 of mobile phones for the business and the agreement stated that the father was a partner in the business. The Court of Appeal reversed the trial judge in holding that the father had neither held himself out as being in partership with his son nor knowingly allowed himself to be so held out. Consequently the father was not liable under s.14(1) of the Partnership Act.
16.2 Lifting the corporate veil
In Conway v Ratiu and Others [2005] EWCA Civ 1302 the Court of Appeal considered both lifting the corporate veil and breach of fiduciary duty. A solicitor acted for one company (R) through a nominee company (C). It was alleged that the solicitor had a conflict of interest with R. The solicitor's argument that he owed no fiduciary duties to R as he was not employed by R was rejected. The corporate veil was lifted as he was aware all along that he was acting for R, the person behind company C.
17.5 The annual return
The registration fee has gone up to £30.
18.7.1 The Rule in Foss v Harbottle
In Cabvision Ltd v Feetum [2005] EWCA Civ 1601 the Court of Appeal held that the rule did not apply to a limited partnership, on the particular facts of the case, and therefore there could be no question of a derivative action. The case raises interesting points about when the rule does apply and when derivative actions are available.
20.4.1 Exclusion from claiming unfair dismissal
In Lawson v Serco Ltd and other appeals Times 27 January 2006 the House of Lords unanimously held that that an airline pilot, employed by a foreign company but based in the UK, could claim unfair dismissal. They also unanimously held that two employees who performed all their services abroad, but who like their employer had close connections with the UK, could claim unfair dismissal. The case involved a detailed construction of s.94(1) ERA 1996.
20.4.4.2 The basic award for unfair dismissal / 20.5.5 Redundancy payments
The maximum weekly wage, to be used in calculating the basic award for unfair dismissal or a statutory redundancy payment, has been increased to £290. So the maximum is now £8,700. The maximum compensatory award for unfair dismissal has been increased to £58,400
21.2 The Sex Discrimination Act
The SDA has been amended to include a new section, 4A, which defines harassment. This definition is based on the one in the Race Relations Act. Harassment can either be unwanted conduct on the grounds of sex or unwanted verbal, non-verbal or physical conduct of a sexual nature. In addition it will need to violate the victim's dignity or create an intimidating, hostile, degrading, humiliating or offensive environment for the victim.
21.3.2 Discrimination 'on racial grounds'
In Refearn Serco Ltd EAT/0153/05/LA the EAT held that an employee who was dismissed for standing as a BNP canditate in local elections was dismissed on racial grounds. He worked with several Asians and his job required him to drive Asian people around but there had never been any complaint made about him. The EAT also said that s.56(1) of the RRA provided that a remedy under the Act need be awarded only where this is just and equitable.
21. 4 Disability discrimination - the meaning of disability
The definition of disability in the DDA has been amended so that, from the moment of diagnosis, people with HIV, cancer of multiple sclerosis are regarded as disabled, without any need to prove an adverse effect on their ability to carry out day-to-day activities.
21.10 National minimum wage
The adult rate has been increased to £5.05, as from 1 October 2005. The development rate for 18-21 year olds is £4.25 and for 16-17 year olds is £3.00
22.3 Misleading price indications
OFT v The Officer's Club 2005 Westlaw 1248431 is an interesting case on misleading price indications. The high court confirmed the status of the Code of Practice and in particular considered para 1.2.2 and 1.2.3 in relation to reducing prices which were artificially inflated in a very few locations, so that it could be claimed that there were very big discounts when the goods were sold in the usual stores.