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The collapse of FTX: lessons for many
From investors to regulators, FTX Trading Ltd (FTX) filing for bankruptcy was unexpected by all. A catalyst for litigation and regulation over the years to come, this collapse will serve as a warning, particularly to cryptocurrency insurers.
Read moreSLAPPs – a round up of the latest developments for the SRA
The last week or so has seen a burst of activity on SLAPPs, alongside criticism of the SRA. This will be of interest to lawyers and their insurers.
Read moreThe scope of a solicitor's duty to third parties in the spotlight again
The Claimant (Mr Syed Ul Haq), via his Estate, brought claims against the Defendants for damages arising out of two frauds in connection with the same property. It is central to this appeal to understand that Rees Page Solicitors never acted for the Claimant. It is indeed for that reason Rees Page Solicitors applied for summary judgment on the grounds that the Claimant had no reasonable prospects of success. After hearing the application, on 13 December 2019, Deputy Master Lloyd, granted summary judgment on the basis that as Mr Ul Haq was not a client of Rees Page Solicitors, they did not owe him a duty of care.
Read moreCosts recovered in the Small Claims Track from an unreasonable Litigant in Person
Most (if not all) litigators will be familiar with the challenge of being on the other side of a claim brought by a litigant in person ("LiP"). The courts expect practitioners to be sensitive to their opponent's lack of legal expertise and familiarity with court rules, but judges have also been clear that they expect all parties – including LiPs – to follow the rules regardless of their legal representation.
Read moreSRA issues Warning Notice on solicitors' involvement in SLAPPs
SLAPPs (aka 'Strategic Lawsuits Against Public Participation') is a term coined in the USA. They are becoming the object of increasing concern over here too.
Read moreInvest in due diligence for dubious schemes (Part 2)
With suspicious activity on the rise, the SRA remind firms of their anti-money laundering obligations.
Read moreImportant changes to Legal Ombudsman Scheme Rules from 1 April 2023
On 28 October 2022, LeO confirmed it will be implementing significant changes to its Scheme Rules, coming into effect on 1 April 2023
Read moreBelsner v CAM Legal Services Ltd and claiming the shortfall from your client
Belsner v CAM Legal Services Ltd [2020] EWHC 2755 (QB) held that a lawyer must make sufficient disclosure so that their client can provide informed consent when it comes to recovering any shortfall in costs from them.
Read moreHong Kong – Claim pleading duty of care against auditor struck out for "putting the cart before the horse"
In Chan Kam Cheung v Ronnie K W Choi & Anor [2022] HKCFI 3028, a judge upheld a master's (judicial officer's) decision to strike out the plaintiff shareholder's action against the former auditors of the company.
Read moreSolicitors Entitled to Insurance Cover for Liability for Fees: Royal Sun Alliance Insurance Limited & Others v Tughans (a firm)
In a recent judgment, Foxton J held that a claim for damages against a firm of solicitors for fees which it was contractually entitled to was covered under the firm's professional indemnity insurance. He held that it did not matter if the fees were obtained through the solicitor's fraudulent misrepresentation provided that the solicitor had done what was required under the contract to earn the fees. The decision will not be welcomed by insurers.
Read moreShorter time limit for Third Parties (Rights Against Insurers) Act 2010 claims
A recent judgment has reduced the limitation period for third parties to make direct claims against insurers under the Third Parties (Rights Against Insurers) Act 2010 when compared to claims under the predecessor 1930 Act. The decision will make it easier for insurers to defend such claims on limitation grounds.
Read moreRisky Business: what to do when former clients ask further questions
In Spire Property Development LLP & Anor v Withers LLP [2022] EWCA Civ 970, the Court of Appeal considered the scope of a solicitor's duty when a former client posed questions to a solicitor concerning a transaction after the retainer had ended. The judgment will be of interest to solicitors who are asked for advice in circumstances where no retainer exists.
Read moreDouble warning for legal professionals: do not cut corners with disclosure
Further to a recent decision made by the Bar Tribunals and Adjudication Service, the Bar Standards Board has suspended a "top criminal silk" from practice on grounds of professional misconduct in respect of his failure to disclose material evidence during criminal proceedings in 2007. The decision, and the judgment made by the Court of Appeal in those proceedings, reiterates the importance of the ongoing obligation on legal professionals to give disclosure and comply with their duties to the court.
Read moreIs the FCA to blame for BSPS? MPs seem to think so
The House of Commons Public Accounts Committee (PAC) yesterday published a report entitled "Investigation into the British Steel Pension Scheme". The report makes a number of recommendations in light of its investigations in to the FCA's conduct and regulatory oversight at the time of the issues arising from the British Steel Pension Scheme (BSPS) and in particular the decision by 7,834 members to transfer to a personal pension arrangement. The report is heavily critical of the FCA's handling of BSPS and its regulatory oversight of the defined benefit transfer market generally. Given the request in the report for an update from the FCA on its progress on the various recommendations and conclusions in 6 months' time, we wait to see how the FCA reacts to yet further criticism of its handling of BSPS at a time when it is reviewing responses to the consumer redress scheme consultation.
Read morePost COVID-19 UK: What Will the Professional Negligence Claims Landscape Look Like?
The cost of living is at an all-time high, with interest rates increasing and inflation currently sitting at around 9%. The chances of a recession in the UK over the next two years have increased. It will come as no surprise that we expect the number of claims against law firms to rise as the economic downturn takes hold, as was the case in 2008 and recessions before it.
Read moreBeware the client who is too busy to litigate
Clients need to understand from the outset of litigation not only how significant the cost of litigation can be, but also the time commitment.
Read moreImportant Court of Appeal clarity on the operation of s1(4) of the Civil Liability (Contribution) Act 1978
A recent Court of Appeal decision (in which RPC acted for the successful barrister Appellant) provides important clarification on the operation of section 1(4) of the Civil Liability (Contribution) Act 1978 (“the Act”). Although the matter concerned a contribution claim by a solicitor against a barrister brought pursuant to the Act, the decision is of wider relevance/application for litigation practitioners and the Insurance market.
Read moreFCA consultation on British Steel redress scheme published
The FCA has now published its consultation paper on the proposed redress scheme for British Steel Pension transfers under s.404 of FSMA. The scope of this is wider than anticipated and the proposals contain some surprises around the lack of an opt-in process and potential involvement of FOS.
Read moreShell directors facing potential UK ESG shareholder derivative lawsuit
In the wake of COP26, more focus than ever is being given to the climate risks which apply to every aspect of business. Scrutiny of a company's climate awareness and adherence to applicable regulation is at the forefront of minds of companies' stakeholders.
Read moreShell directors facing potential UK ESG shareholder derivative lawsuit
In the wake of COP26, more focus than ever is being given to the climate risks which apply to every aspect of business. Scrutiny of a company's climate awareness and adherence to applicable regulation is at the forefront of minds of companies' stakeholders.
Read moreThe X-Client Files: who owns a solicitor's file
It's a perennial headache for solicitors: what exactly am I supposed to do when a client asks me for 'their file'?
Read moreSIPPs and FOS - does the Rowanmoor decision change anything?
Last week FOS published a decision it reached last year in a complaint against a SIPP provider involving advised sales. The FOS upheld the complaint, finding that the SIPP provider should have rejected business from the regulated financial adviser, CIB Life and Pensions Limited (CIB), given, broadly, red flags available to the SIPP provider with respect to the operation of CIB's business model including that CIB was not advising on the ultimate investment within the SIPP and as a result such introductions involved a significant risk of consumer detriment. The decision has received quite a bit of press attention - but has it moved the dial for SIPP complaints before FOS or not?
Read moreGood faith does not go both ways
It is common knowledge that solicitors owe fiduciary duties to their clients but what about the other way around? Do clients owe a duty of good faith to their solicitors (as an implied term of the retainer)?
Read moreThe Future of Insolvency Regulation
On 21 December 2021 the Government launched a consultation into the future of insolvency regulation. The changes proposed in the consultation document will have a wide ranging impact on the insolvency profession (and its insurers) with the proposals including: the direct regulation of insolvency firms, the introduction of a single regulatory body with powers to order compensation against insolvency practitioners and firms, a new additional requirements regime, changes to the bond regime and a public register of insolvency practitioners and firms. Many of the changes proposed require primary legislation and so it may be some time before the changes to take effect (if adopted). But there does appear to be some wind behind these proposals given they follow on from the Call for Evidence in 2019 and a more general focus on insolvency issues in the wake of the Covid-19 pandemic.
Read moreFOS proposals to clear the back-log - attractive or not?
The Financial Ombudsman Service (FOS) has proposed a temporary approach to the classification of certain complaints in an attempt to alleviate their complaints backlog exacerbated during the COVID-19 pandemic. The approach could see firms looking to pro-actively resolve complaints before a defined cut off date before FOS reaches a decision so that the complaint is recorded separately and not as a "change in outcome" (i.e. where a complaint has been rejected by a business and upheld by FOS). The consultation was open for a short two-week period between 4 and 18 October 2021.
Read moreAggregation under the solicitors' minimum terms: are primary layer insurers ready for potentially limitless liability?
In Baines v Dixon Coles & Gill the Court of Appeal has substantially limited the extent to which claims against solicitors can aggregate.
Read moreSolicitors' Undertakings: will the lacuna in the law undermine the smooth and efficient transaction of legal business
Solicitors undertakings are a vital tool in legal practice to ensure the smooth running of litigation and transactional matters.
Read moreRocha-Afodu v SRA – the regulator's powers over solicitors' private lives are examined again
If the boundary between a solicitor's professional and private lives were ever to be mapped, it would probably look like the coastline of Norway - infinitely complex, jagged and largely rocky. The da Rocha-Afodu v SRA decision ([2021] EWHC 1666 (Ch)) is another Divisional Court case exploring this difficult terrain, following upon that of Beckwith v SRA [2020] EWHC 3231 (Admin).
Read moreThe Regulatory Spotlight is shining bright and not just on AFMs
On 20 June 2021, the FCA published its findings from the review it carried out on host Authorised Fund Management firms during 2019-2020. The purpose of the review was "to test the viability of the host Authorised Fund Manager (AFM) business models and assess whether conflicts of interests were being effectively managed."
Read moreSupreme Court Changes to the Assessment of Loss in Professional Negligence Claims
On 18 June 2021 the Supreme Court handed down two judgments in cases examining the application of the SAAMCo principles. These are principles that have dominated the law of professional liability since 1997 and limited the recovery of damages by claimants against professionals. In these judgments the Supreme Court significantly alters the tests for determining whether a particular loss falls within the scope of duty of the professional.
Read moreA tale of loss, limitation and a flawed transaction: why a loss may not feel like a loss
A recent Court of Appeal decision, Elliott v Hattens [2021] Civ 720, has once again raised the vexed issue of when the limitation period starts to run in a flawed transaction case. Does it start running immediately or at some later date? .
Read moreEscalating ground rents: CMA takes further action against developers
A look at the recent developments in the leasehold market and the effects on leasehold owners and future purchasers.
Read moreIt's Cocoa, Jim, but not as we know it: Court's modern interpretation of underwriters' and brokers' duties #3 - A broker's harsh reality
This is the third article in our series following the decision in ABN Amro Bank N.V. v Royal & Sun Alliance Insurance plc and 13 Underwriters and Edge Brokers (London) Limited, in which RPC acted for Edge. Please click here for our first article, setting out a more detailed background to the case.
Read moreCompany Top Guns may face HMRC investigation
HMRC clamping down on furlough fraud by companies in Danger Zone
Read moreStamp Duty Holiday. Not a "holiday" for conveyancers.
In an attempt to prevent the housing market from stalling during the COVID 19 pandemic, a stamp duty holiday was announced for all residential purchases under £500,000 between 8 July 2020 and 31 March 2021.
Read moreBEIS issues White Paper: D&O perspective
The Department for Business Energy and Industrial Strategy (BEIS) has today released its White Paper, setting out its proposals for audit reforms and corporate governance, entitled "Restoring trust in audit and corporate governance".
Read moreSPACs Invaders – Implications for D&O insurers
The EU's former Financial Services Commissioner, Lord Hill, has delivered the anticipated UK Listing Review which contains recommendations for reform of the UK's current listing regime. This included changes to listing rules with a focus, amongst other things, on special purpose acquisition vehicles (SPACs). SPACs are more flexible than formal IPOs and are used to raise capital in order to merge with/acquire another company. In the US, commentators predict an increase in securities claims involving SPACs, so this development is potentially relevant to London market D&O insurers.
Read more800 DB Transfer complaints to the FOS: A 44% increase in one year
The FOS have seen the number of complaints relating to defined benefit transfer advice increase by 44% since 2019. However, the proportion of decisions being upheld appears to have fallen.
Read moreGameStop – a game of chicken?
The race to purchase shares in ailing American video game retailer, GameStop, has taken the investment world by storm over the last week, with amateur traders waging war on professional hedge funds.
Read moreSMCR: an effective deterrent?
The Senior Managers & Certification Scheme (SMCR) was introduced in early 2016 to establish "effective governance in firms by encouraging greater individual accountability". However, following a response to a recent Freedom of Information (FOI) request, questions have been raised as to its effectiveness as a deterrent.
Read morePart 36: avoid a storm, use the form!
Pepperall J's impressively clear judgment in Essex County Council v UBB Waste (2020) makes it abundantly clear that, when it comes to Part 36 Offers, the rules are strict. If litigants wish to reap the significant rewards of this regime, the price they must pay is to ensure they (or their solicitors) follow the rules on how offers should be made.
Read moreA Warning to Architects to be Smart about their Social Media
The Architects Registration Board has recently erased Peter Kellow from the register of architects as a result of a racist post on his Facebook which was publicly visible.
Read moreInvest in due diligence for dubious schemes
The SRA provides updated guidance for firms to avoid becoming involved in dubious investment schemes.
Read moreReflective loss in claims against solicitors and accountants after Marex
The so called "rule against reflective loss" has been clarified in an important decision handed down by the Supreme Court in Marex Financial Ltd v Sevilleja [2020] UKSC 31.
Read moreWhere there's a will there's a remote possibility of a way
In the face of the global COVID-19 pandemic the government has acted to change the law to allow wills to be witnessed remotely.
Read moreIs more co-operation the new normal?
What keeps you as a lawyer awake at night during the coronavirus pandemic? The list is likely to be very long and the fear of making a mistake will be close to the top. Help may come from some unexpected quarters such as the Courts.
Read moreRelief from sanction: claimant being forced to pursue his solicitors for negligence is not desirable
A recent High Court decision demonstrates a common-sense, realistic approach to relief from sanctions. Solicitors might have become used to judges, when striking claims out, reassuring the claimant that they can always sue their solicitors for negligence. In a welcome judgment, Mr Justice Fancourt reversed a decision to refuse relief from sanction.
Read moreThe Solicitors Disciplinary Tribunal: new rules, new game?
There are few things that strike fear into the heart of a solicitor more than the prospect of being sent to the Solicitors Disciplinary Tribunal. This article looks at its new rules of procedure.
Read moreJudicial guidance on listing of hearings remotely
Senior judges have issued guidance to the judiciary on listing hearings in light of the current coronavirus situation. This gives litigants some clues as to how the court will approach upcoming hearings.
Read moreDisciplinary investigations against architects #4 - investigations panel stage
Further to our previous three articles which provided (1) an overview of the Architect Registration Board's disciplinary process and (2) a review of the complaints stage (3) the review stage, this article explains the next stage of a disciplinary investigation against an Architect: the investigations panel stage.
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