Breeze & Wyles Solicitors LLP nominated by Tikit TFB for two awards at its National User Conference

Breeze & Wyles Solicitors LLP is proud to announce that it has been nominated in two categories at the TIKIT TFB National User conference on 9 December 2010 being held at the Crowne Plaza in Birmingham City Centre. TFB has for the last 13 years supplied Breeze & Wyles with its case management system. The categories in which the firm is nominated are:

1. Most Innovative Use of Partner for Windows

2. Reference Site of the Year

Murray Fraser, Director of Volume Legal Service says:

"Once again our automation of legal services is being recognised, this time by the IT Supply market as providing leading solutions in the legal services industry for institutional clients. We are very proud of the systems that we have developed and are now looking both at further development and new sectors in which to implements these products to drive down cost to the client"


The OFT crosses the line into judicial territory

In a statement issued today by the Civil Court Users Association it slams the OFT for the action that it is taking against four lenders who have used charging orders.
The statement says: "concerned that the Office of Fair Trading (OFT) is now involving itself in what are judicial decisions"
It is the responsibility of the judiciary to ensure that the appropriate route to enforcement is used not the place of the regulator. If the law is unsound in this area it is then the place of Parliament to legislate on the issue.
We would welcome reader's views on this issue.

A Notice of Intention to Appoint Administrators not conclusive reason for refusing a Charging Order Final

If you are a creditor of a company with unfinished proceedings make sure you complete it getting judgment and enforcing. The following case suggests that dilatory behaviour on the part of the creditor will mean that they lose the preference rights that they had through the proceedings and then join with the other unsecured creditors in the limited dividend that this might produce.
The respondents brought proceedings in the High Court against the applicant property company for unpaid work to the value of £138,602, and applied for summary judgment. The master made a number of orders, pursuant to which the company had to pay the respondents the sum of £11,500 within a certain time. The payment was not made, but the respondents did not apply to enter judgment. The company made an unsuccessful application for permission to appeal against the orders. The respondents successfully applied for an interim charging order. Meanwhile, the company passed a resolution determining that it was in the best interest of the company and its creditors to appoint administrators. Under paras 43(2) and 44(4) of Sch B1 to the Insolvency Act 1986, there was a moratorium which provided that without an order of the court, no legal process could be continued or steps taken to enforce a security. The respondents applied to the court for a final charging order, on the basis that it was inconceivable that the company could be insolvent, and accordingly that the administration process was a sham. Allowing the application to make the charging order final, the master accepted that the administration process was a sham. On that basis, he decided to ignore the effect of the interim moratorium. The joint administrators applied for an order discharging the final charging order.
Consideration was given to s 3(5) of the Charging Orders Act 1979 which gave the court jurisdiction to vary or discharge the charging order.
The court ruled:
It was wrong to treat a notice of intention to appoint administrators as a conclusive reason for refusing to make a charging order final. Where it appeared, however, that the intended administration had been appropriately invoked, then it was plainly a powerful factor to be taken into consideration. Were that not so, a creditor with notice of the administration would be able to gain an advantage over the other creditors who would all be subject to the statutory scheme.
On the evidence, the company was insolvent on a balance sheet basis. If the charging order remained in place, there was a real risk that it would operate to the disadvantage of the creditors as a whole, as there would appear to be a shortfall of assets over liabilities. Had that position been clear to the master, he would not have come to the conclusion that the administration was a sham, but would rather have had regard to the moratorium, and declined to grant the respondents security.
Accordingly, the court would exercise its discretion under s 3(5) to set aside the charging order.

UK Government launches growth review

The Chancellor of the Exchequer, George Osborne and Business Secretary, Vince Cable today announced a fundamental review of what all parts of Government are doing to create the best conditions for private sector growth.

Building on the action already taken by Government and outlined in the paper, ‘the path to strong, sustainable and balanced growth’, business is being invited to take part in this work which will challenge every Government department on the measures being taken to tackle barriers to growth.

The growth review will start with an intensive programme of work, based on the evidence provided by business, to report by Budget 2011. Departments will be required to present Action Plans to a Ministerial Ad-Hoc Group chaired by the Chancellor and Business Secretary, on what contribution they will make to:

"reform structural barriers across the whole economy in planning, competition, trade and investment, regulation, access to finance and corporate governance remove barriers in sectors where there are clear opportunities for growth and where Government can make a difference – construction, retail, health and life sciences, professional and business services, manufacturing and digital and creative industries This is just the start. These specific sectors and structural areas have been identified as a priority for the Government; over the course of the review, the Government will need to take a forensic look at all sectors of the economy. The work will continue for the lifetime of this Parliament, ensuring all Government departments think first and foremost about the impact of their policies on growth. "

Chancellor of the Exchequer, George Osborne, said:

“Alongside the corporate tax reforms announced today, the growth review contributes to the Government’s drive to remove the barriers to growth and improve British competitiveness. "

“We have been clear that growth will be driven by the private sector. By working closely with business and industry in this intensive programme of work, Government can make sure that Britain is open for business.”

Business Secretary, Vince Cable, said:

“Growth is the primary focus of the Government, but this will not happen overnight. That’s why we’ve set out a long-term vision to create the right conditions for future economic prosperity."

“We cannot lay out plans for how the economy will grow – growth is delivered by the private sector. What we can do is provide the conditions to promote a new economic dynamism, harnessing our strengths, removing the barriers and putting the private sector first when it comes to decisions on tax, regulation and spending.”

R3 warns of rise in corporate insolvencies!

R3 is reporting that Corporate Insolvencies could rise by nearly eleven hundred cases over the next year as nearly a million businesses see their profits fall. Almost half of UK businesses, some 850,000, are currently experiencing falling profits, which is the most common form of current financial distress identified in new research carried out.

R3 president Steven Law issued a warning that corporate insolvencies could rise by 1100 cases over the longer term and in light of the patterns followed in previous recessions.

He said: “Insolvency Practitioners are expecting corporate insolvency numbers to increase for 2011 to 27,500. In 2009 the figure was 26,400.

“It is worrying that the most common signs recorded in September this year are decreased profits and a reduction in sales volume, given we are now out of recession. Although corporate insolvency numbers have decreased over 2010, experience of past recessions tells us to expect them to continue rising as the recession finishes in an insolvency lag.”


Construction industry must undergo huge change to meet the low carbon challenge

The construction industry faces the largest change management programme since Victorian times if it is to meet the low carbon agenda, according to an industry report published today.
The Innovation and Growth Team (IGT), which is drawn from the construction industry, was tasked by the government to consider how the construction sector could meet the low carbon agenda and the IGT today published its report.
The report said the construction industry had engaged positively with the sustainability issue with many examples of cutting-edge practice.
But the Climate Change Act calls for the net UK carbon account in 2050 to at least 80% lower than the 1990 baseline, which will require a ‘quantum change’ in the industry’s response to this challenge, says the document.
The report highlights four themes that government and industry need to engage on to rise to the carbon challenge:
The potential size of the market – meeting the UK’s commitment to reducing carbon and other greenhouse gas emissions will affect every aspect of the built environment. The scale of the necessary change is considerable but there is much that could be done now, particularly with the existing building stock.
Opportunities for SMEs – transforming the built environment to low carbon could provide the industry with a 40 year programme of work and act as a springboard to growth for more than 200,000 small businesses in the sector.
The wider green economy benefits – the green economy represents an area of substantial potential growth for the UK. Creating a low carbon construction industry would develop skills and expertise that would be of great value to other sectors.
Stimulating demand – there would be little point in developing the necessary capacity and skills if the demand for low carbon was not there. Government and industry need to work closely together to identify the best ways to stimulate the market for low carbon and energy efficiency measures.
Paul Morrell, who led the IGT, said:
“Meeting the low carbon agenda is both a challenge and an opportunity for the construction industry.
“It will require radical change to the way we do business as well as government action to meet the scale of the challenge. There are no easy answers.
“I hope this report will mark the start of a detailed collaboration between industry and government to address this complex issue.”
The report will now be considered by the Government, which will respond to the recommendations next year.
Construction Minister Mark Prisk said:
“This report is a valuable contribution to the debate around how the construction industry can play its part in the UK meeting its low carbon responsibilities.
“We will carefully consider this important document and the government will respond to these detailed recommendations next year.
“As a former chartered surveyor I am very much aware of the importance of the construction industry and the opportunity for growth the low carbon agenda represents. Now we need to make the most of that opportunity.
“Success in moving to a low carbon construction industry would provide UK firms with the chance to grow overseas as other countries seek our expertise and skills in this area.”
The low carbon construction agenda is an issue that goes across Government and report addresses various Government departments.
Communities Minister Andrew Stunell said:
"I welcome this report from Paul Morrell and the IGT. As we look to make building regulations easier to understand and follow, his recommendations will certainly be worthy of serious consideration.
"The Government wants to make it easier for housebuilders to go green. That's why we're already scrapping a myriad of regulations so the construction industry has one simple and concise set of guidelines for environmental assessments, making it user friendly, removing excessive red tape while also ensuring that the environment can be protected."
Climate Change Minister Greg Barker said:
“The Green Deal will provide a massive opportunity for industry, as well as making Britain’s homes and businesses warmer and more environmentally friendly. The Green Deal could unlock several billion pounds of private sector investment per year and support up to 250,000 jobs. My department will shortly introduce a new Energy Bill into Parliament which will set the framework for industry to deliver this ambitious programme. We welcome today’s report which shows industry is already gearing up to the challenge.”

Breeze & Wyles Solicitors LLP achieves 3rd place in the Land Registry rankings

In the recently released figures from the Land Registry for October 2010 application of the 7300 firms who made application in that month Breeze & Wyles Solicitors LLP achieved its highest ranking of 3rd place. There is still some way to go to threaten second place but this is a significant step forward for the firm in its push to be one of the largest firms providing quality legal services to the property sector.

Murray Fraser Director of Volume Legal Services at Bishops Stortford says:

"In such difficult times for the UK Property Sector it is fantastic news for us that while most applicants numbers are heading south that we are heading upwards reflecting our ability to automate even the most technical of processes. There are plenty of opportunties in the market and Breeze and Wyles is very well placed to expand its market share. November applications are already higher and the trend is heading to new levels. Demonstrating automation is one thing but putting it into practice in a market leading product is another. This is why lending institutions are monitoring us for the future. Watch this space!"

No Additional Rights for Former Owner - now Occupier

In a recent case the Chancery Division has further defined the situations in which the lender can be protected against a former owner with a potential interest generated by actual occupation.(Governor and Company of the Bank of Scotland v Hussain and another)
The second defendant sold her home (the property) to the first defendant, at an undervalue in 2001. The first defendant had executed a charge over the property in favour of the claimant bank. The charge was as security for the loan which he had taken out to fund his acquisition of the property. Subsequently, the second defendant issued proceedings against the first defendant alleging that the sale of the property had been procured by undue influence and was an unconscionable bargain (the 2001 action). The 2001 action was later amended to include a declaration that the charge over the property in favour of the claimant was invalid. The court found that the sale should be set aside as having been procured by the first defendant's undue influence and as an unconscionable bargain. It found however that the second defendant's argument of non est factum in order to defeat the charge did not succeed and the claimant's charge remained valid (the 2001 judgment). The claimant revived an action seeking possession of the property and payment of sums owned under the charge by the first defendant (the 2002 action). The second defendant served a defence and counterclaim invoking, inter alia, s 70(1)(g) of the Land Registration Act 1925 (the Act) (the s 70 defence). That section stated to the effect that all registered land, unless expressed to the contrary, was subject to the rights of every person in actual occupation of the land. The claimant applied to have the s 70 defence struck out as an abuse of process. The master refused the strike out that application. That decision was upheld on appeal. The appeal judge concluded that the second defendant's conduct in not raising the issue in the 2001 action could not be regarded as an abuse of process as the 2001 proceedings had concentrated on the relationship between the first defendant and the second defendant and was not directed at the secondary question of what might happen if the transaction between the first and second defendant were set aside. In the instant proceedings the claimant sought a possession order over the property. The second defendant challenged the possession claim by contending that she was in 'actual occupation' when the charge was granted and, hence, that the claimant's rights under the charge were subject to her own rights in the property.
The issues were, inter alia: (i) whether the 2001 decision meant that the second defendant was not entitled to challenge the charge in the instant proceedings on the basis of res judicata principles. The claimant relied not only on res judicata in the strict sense (encompassing cause of action estoppel and issue estoppel) but on merger and the extended doctrine of res judicate based on abuse of process; (ii) whether the second defendant was in actual occupation at the relevant time; and (iii) whether although the second defendant had been in actual occupation and had an overriding interest, she was to be taken as being bound by the mortgage or charge. In that regard the claimant submitted that as the second defendant knew of the charge and was therefore estopped from advancing such a case.
The claim would be allowed.
The principles relating to res judicata, cause of action estoppel, issue estoppel, the extended doctrine of res judicate based on abuse of process and merger, were established law.
In the instant case, the res judicata principles, including an abuse of process argument, did not preclude the second defendant from challenging the charge. In respect of cause of action estoppel, the cause of action which the second defendant was asserting against the claimant was not the same as any cause of action she had asserted as against the first defendant in the 2001 Action. Further, in respect of issue estoppel, the claims advanced by the first defendant had merely been advanced against the first defendant and not against the claimant. In respect of merger, the judgment obtained by the second defendant against the first defendant did not operate to extinguish the claim she was advancing against the claimant. Neither the claims or the remedies of the 2001 judgment represented an alternative to the second defendant's challenge to the charge. In respect of abuse of process, the judge's affirmation of the master's refusal to strike out the defence and counterclaim barred the bank from contending in the instant case that the defence and counter claim represented an abuse of process. It was precisely the same issue as was raised by the strike out application and the judge's decision was a final determination of the question of abuse of process.

(2) It was established law that once the imputed intention was that the actual occupier's rights were to be subject to the mortgage (or charge), there was nothing in s 70 of the Act which enlarged those rights into any greater rights.

hat principle was capable of applying even where there was no direct relationship between the person asserting rights and the mortgagee. The principle was not limited to merely precluding a representor from denying a statement of existing fact.
In the instant case, in all the circumstances, viewed objectively, the second defendant and the claimant had a shared assumption that the property would be bound by the charge or alternatively that the claimant had made such an assumption and the second defendant had acquiesced in it
A possession order would be made in favour of the claimant.

Beware the principal debtor guarantee

In a recent case the courts have been asked to identify when a guarantee can lead directly to bankruptcy of the guarantor without the need for proceedings against the principal debtor.
Section 267(2)(b) of the Insolvency Act 1986, so far as material, provides: '(2) Subject to the next three sections, a creditor's petition may be presented to the court in respect of a debt or debts only if, at the time the petition is presented -- ... (b) the debt, or each of the debts, is for a liquidated sum payable to the petitioning creditor, or one or more of the petitioning creditors, either immediately or at some certain, future time, and is unsecured ...'
The guarantor gave a guarantee and indemnity (the guarantee), dated 10 September 2008, to the creditor bank in respect of a sum of £1,223,883.26 in relation to the borrowing liabilities of his brother (the principal debtor). The guarantee was made on the creditor's standard form. Clause 2.3 of the guarantee provided for the guarantor to make payment on demand. Clause 4.2 of the guarantee provided that the guarantor's obligations were those of principal debtor, not merely those of a surety. The principal debtor defaulted on his obligations and the creditor thereafter demanded payment by the guarantor of the sum, pursuant to cl 2.3 of the guarantee. It was common ground that the liability of the principal debtor in respect of which the demand was made was a liquidated sum, rather than, by contrast, a liability to pay damages at large for some breach of the borrowing facility. On 24 February 2010, a bankruptcy order was made against the guarantor on a petition by the creditor in respect of the sum alleged to be due under the guarantee. The guarantor appealed against the bankruptcy order.
Issues arose as to the nature of a guarantor's liability to the creditor, and the consequences in terms of the creditor's ability to present a bankruptcy petition. In short, a question arose as to whether the sum in question was a liability 'for a liquidated sum' within the meaning of s 267(2)(b) of the Insolvency Act 1986, or only a liability to pay unliquidated damages. If the latter was the answer, then was the creditor disabled from presenting a bankruptcy petition without first obtaining judgment for a specific sum, even in a case where the liability was admitted, and the amount of the damages could be identified with mathematical precision.
The appeal would be dismissed.
Where a guarantee sounded in damages rather than debt the creditor might enforce against a mere surety without prior demand on the guarantor, precisely because the principal debtor's default gave rise to a simultaneous breach of the surety's obligations. The effect of a principal debtor provision was not to enable the creditor to proceed without first claiming against the principal debtor but that any debt due was immediately payable by the guarantor without prior demand upon him.
The guarantee contained both a provision for payment by the guarantor on demand at cl 2.3, and a provision that the guarantor's obligations were those of principal debtor not merely those of a surety at cl 4.2. The guarantee did not state in terms that the guarantor's obligation was to see to it that the principal debtor himself paid all amounts due. Rather, it was neutral on the question by whom the guarantor promised that those debts would be paid. The guarantee did not speak in terms of payment of outstanding debts of the principal debtor, but rather of payment of any amount claimed under the guarantee by the creditor. The guarantee was therefore silent as to whether the creditor's claim was to be for damages or for a liquidated sum. In the instant case, the issue was not necessarily an either/or question as between debt and damages. The critical question was whether the guarantee included, rather than necessairly consisted of a debt obligation. The guarantee did include a debt obligation. Under the terms of the guarantee the guarantor had made the principal debtor's debts his own. Accordingly, the creditor was entitled to demand payment of the very debt which by cl 4.2 the guarantor had made his own. It was a liquidated sum within the meaning of s 267(2)(b) of the Act.

SMEs will drive the economic recovery: Barclays Business

In a recent report produced by Barclays Business in conjunction with Kingston University Small Business Research Centre Barclays have stated that SMEs will drive the economic recovery.

Discarding the statistics, and for a moment looking at the drive of the report, it would seem that the assumptions about how this is to be achieved in the long term is with the catalyst of banking support for funded growth. Deny all they like but banks are not lending. In order to obtain this long term growth risk attitudes must be relaxed. Note that the author does not say return to normal which he suspects that most people assume is 2007 normal.

The Government really needs to address this issue. The point of bankers bonuses is going to become a very serious issue over the coming months as the next round is disclosed to the public at large and more people are failing to see any change at the banks. Most people understand that in the short term SMEs will be the largest employer in the country collectively and as a result the economy's very stability is at jeopardy. Fine words Barclays but now the action!