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Claim Procedure Reforms Will Affect Smaller Claims
With all the recent publicity surrounding the proposed changes to the ‘no win, no fee’ regime, another set of proposals, which may well be of greater importance to many people, has slipped under the radar of the popular press.
A new consultation paper proposes changes to the limits on claims to be heard by the lower courts. The proposals include:
In addition, the online system for the settlement of smaller road traffic accident claims is to be adapted for use in personal injury cases up to as much as £50,000 in value and trialled for use in claims for clinical negligence against the National Health Service.
The consultation also suggests greater use of mediation as a means to resolving disputes without going to court. In particular, it proposes an automatic referral to mediation for all small claims matters (probably by telephone) along with Mediation Information/Assessment Sessions for claims under £100,000. These information sessions would provide an opportunity for the parties themselves, not just their representatives, to be given information about the mediation process and its benefits from a mediator.
The proposals in the consultation paper are very wide-ranging and may lead to substantial changes in how civil litigation operates.
Our Dispute Resolution Team can assist you with all types of legal disputes, from small claims to mediation. Please contact Steven Mather for further information.
Redundancies Following a TUPE Transfer
When one business has acquired another similar business under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE), the need for redundancies often arises. In First Scottish Searching Services Ltd. v McDine and Middleton, the judgment of the Employment Appeal Tribunal (EAT) illustrates what approach the Employment Tribunal (ET) should adopt when deciding what constitutes a fair redundancy selection process when the selection pool includes employees of the transferor and the transferee.
First Scottish Searching Services Ltd. (FSSS) had acquired another property title search business, SPH, in 2009. The contracts of employment of employees of SPH were automatically transferred to FSSS in the TUPE transfer. FSSS had warned that redundancies would be likely and, in the event, used the same scoring matrix as it had adopted during an earlier round of redundancies in 2008. Former employees of SPH were assessed by managers who had transferred with them, whilst the scoring for existing FSSS employees was carried out by managers familiar with their work. The scores of the latter group were also compared with those achieved in the 2008 redundancy exercise. As it turned out, all of the employees identified as being at risk of redundancy had transferred from SPH.
Two of the dismissed employees contended that the redundancy exercise was biased and brought claims for unfair dismissal.
The ET criticised the redundancy selection system used by FSSS because it did not incorporate ‘some system for moderating the two sets of scores’. In its view, because there was a ‘clear and overt risk of unfairness’, the entire redundancy process was unfair. FSSS appealed against this decision.
The EAT upheld the appeal. The ET had failed to give any explanation of what it meant by ‘moderating’ the scores nor, indeed, how moderation came to be a feature of the case at all. There were no findings of fact as to what might actually have been done to achieve whatever it was the ET had in mind nor as to what would have been the likely outcome if ‘some system of moderation’ had been employed.
Under Section 98 of the Employment Rights Act 1996 (ERA), whether or not a redundancy dismissal is fair or unfair depends on whether the employer acted reasonably or unreasonably in deciding to dismiss the employee. In many cases, there will be a band of reasonable responses, with room for legitimate differences of opinion amongst reasonable employers as to what is a fair way to act. Case law establishes that it will rarely be appropriate for an ET to perform a detailed scrutiny of the scoring system or the application of the system in a particular case.
The ET had fallen into the trap of engaging in a ‘microscopic’ and ‘over minute’ reassessment of the redundancy selection process and had substituted its own opinion for that of a reasonable employer. It had sought perfection when this is not what is required by the ERA. There was no finding of fact as to any inconsistency of approach between the two sets of managers and no evidence of deliberate bias. Furthermore, the ET had failed to consider the impact on the redundancy decision of the claimants’ scores for length of service – a wholly objective criterion that no amount of moderation could have affected – which was clearly substantial.
For advice on any redundancy matter, please contact Steven Mather.
New Penalties for Serious Data Protection Breaches
New powers, designed to prevent serious breaches of personal data security, are due to come into force on 6 April 2010. The Information Commissioner’s Office (ICO) will be able to order organisations to pay up to £500,000 as a penalty for serious breaches of one or more of the eight principles in the Data Protection Act 1998 (DPA).
When serving monetary penalties, the Information Commissioner will take into account the circumstances surrounding the failure to comply with the DPA, including:
the seriousness of the data protection breach;
the likelihood of substantial damage and distress to individuals;
whether the breach was deliberate or negligent; and
what reasonable steps the organisation has taken to prevent breaches.
Factors to be taken into account when determining the level of the fine will include the type of organisation, its financial resources and the size and severity of the data breach, so that undue financial hardship is not imposed on the organisation.
Statutory guidance on how the ICO will use this new power can be found at
http://www.ico.gov.uk/upload/documents/library/data_protection/detailed_specialist_guides/ico_guidance_monetary_penalties.pdf.
Information Commissioner Christopher Graham said, “Getting data protection right has never been more important than it is today. As citizens, we are increasingly asked to complete transactions online, with the state, banks and other organisations using huge databases to store our personal details. When things go wrong, a security breach can cause real harm and great distress to thousands of people. These penalties are designed to act as a deterrent and to promote compliance with the DPA.”
In addition to these new powers, the Ministry of Justice has carried out a consultation on exercising the power to provide for custodial sanctions for those found guilty of knowingly or recklessly obtaining, disclosing or procuring the disclosure of personal data, without the consent of the data controller, and of selling or offering to sell personal data that has been obtained unlawfully. These are all offences under Section 55 of the DPA.
However, the proposals make it clear that the Government does not wish to prevent legitimate investigative journalism and there is therefore a proposal to commence, simultaneously, a new defence under Section 55 relating to the purposes of journalism, art and literature.
One of the advantages of the Act is that it has made the incorporation of a company easier by creating a new and simplified set of model articles of incorporation.
However, before you rush off and buy an ‘off the shelf’ company, pause to consider this – it is usually much more sensible to start with the right articles than to amend ‘standard’ articles to say what you mean later.
Articles tend to be of little importance to directors and shareholders until the company has ‘grown up’ a bit – by which time vested interests can be strong and changes to the internal regulations, such as alteration of share capital rights and so on, can be difficult and full of hidden pitfalls. These sorts of issues can prove a disaster when there are discussions ongoing relating to the retirement of directorshareholders or a proposed purchase of the business or of a shareholding in it.
We can advise you on all matters relating to setting up in business.
A recent case saw the first injunction to be served via a social networking site. An unknown individual, who was posing as the political blogger and solicitor Donal Blaney of Griffin Law, was served with a court order to prevent him from continuing under that guise and to require him to reveal his true identity. The injunction, now referred to as ‘Blaney’s Blarny Order’, was groundbreaking due to the fact that it was served via the Twitter website.
The injunction was granted on the basis that the Twitterer had breached Mr Blaney’s copyright. It is understood that the unknown Twitterer contacted Donal Blaney two days after the injunction was served and a four-figure sum was agreed in settlement.