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Probate Fee Increase – Update
A Modern Look At Testamentary Freedom
Nationwide standing up to Unscrupulous Landlords and Developers
Falling off a roof – Accidents at Work do still occur!
Probate Fee Increases
Family Law: New Year Resolutions!
2016 – A Bad Year For Prison Officers
Bigger than Birmingham
Pensions on divorce: what to do with a fund held in another country
The dangers of Japanese Knotweed
Understanding Leases
Personal Chattels in Estate Administration
Networking – Increasing Business and Adding Value to our Clients
Driverless Cars and Personal Injury Claims
Accidents at work do still occur!
Lasting Powers of Attorney (LPAs) and gifts:
In search of the lost Freehold Landlord
Prison Officer Claims
Personal Injury Guide
Will there be inheritance tax changes post-Brexit?
Do we need Personal Injury Lawyers anymore?
Property Alert from HMLR to Prevent Fraud.
New Beauty Treatment Regulations to come into force
How Safe is your Gas Boiler-Tenants be aware!
Morrison’s Supermarket case makes Legal History
Asbestos – The Silent Killer
Media Access to the Family Court
Autumn Statement
Fairness for Families Suffering Bereavement
HPW at work in the local community
HPW celebrate the 40th anniversary of the Health & Safety at Work Act
Proposed changes to the Criminal Injuries compensation Scheme
Dog Law changes afoot
Cycling a risky business in the Capital
Making gifts as an attorney or deputy
Why make a Lasting Power of Attorney?
What to do when someone dies?
Why make a Will?
Inheritance Tax Information Sheet 2013-2014
Everyone Needs a Lasting Power of Attorney
New Intestacy Laws come into effect 1st October 2014
Mishandled Will and Probate Estate claims up by 300%
A tip for new home owners
Understanding advertising standards
The Personal Representatives Guide
“How to make a Will” – The Week Magazine: 31 May 2014
Watch out for the water Study sees rise in claims over contaminated swimming pools
Victims not getting fair compensation for personal injury says local law firm
Third Corporate Manslaughter Case at Work
The Dangers of First Time Parachute Jumping
Prisoner Officer finally compensated after fake bomb scare
Parent found Contributory negligent for choosing incorrect child seat
Law Society Demands Fair hearing from the Government on Personal Injury
Interest in Personal Injury Claims
Government Proposals to raise Small Claims Court Limit
General Damages to be Increased
Funding Personal Injury Claims in the new regime from 1 April 2013
Court of Appeal overturns 10% damages increase ruling in the case of Simmons v Castle
Construction News Health and Safety update
Beauty Treatment Injuries
Accident at work in a London Prison
Health & safety – Construction Sites
Court disregards Director’s claim to sue himself
High Court rejects challenge based on ‘want of mental capacity’
Court rejects evidence delivered too late
Judge ends litigation wars
Landmark decision expected to cause major implications for school trips and extra curricular activities
Mental Capacity Jargon Buster
Lady Hale: Breaking through barriers once again
“Don’t get mugged by an insurer”
Landmark ruling sends a serious warning on attempts to conceal wealth in divorce proceedings
Attorneys, Deputies and Dalmatians
Funding Family Law Advice
Home Ownership in London
Elderly Care in England
Professional Negligence during the Conveyancing Process
‘The biggest change to divorce law for 40 years’
Accident At Work Article as featured on page 9 of the Metro dated 23 February 2012

Firm News

Looking forward to the forthcoming events at The Bedford Park Festival as proud sponsors.
Hubbard Pegman & Whitney supports Bedford Park Festival
The Athena Network Group
Hammersmith and Fulham Means Business 2018
Hammersmith and Fulham Mean Business
New Appointment
BCSA Union
Conveyancing Quality Scheme
British Keralites Onam Celebration
Grenfell Fire
Hubbard Pegman & Whitney to sponsor Bedford Park Festival 2017
Child Arrangements with Seasons Greetings
Christmas & New Year Opening Hours
Training and Networking
Welcome to Jim Richards
Shared Ownership: A Step on the Property Ladder
Melanie Chandler Testimonial
Personal Injury: Veera Testimonial
Outi Hubbard tells her story to Spear
Work together with our Property Department
HPW Supporting The Mulberry Centre
British Keralites Association Onam Celebration 11th September 2016
Chiswick Book Festival Opening Night
British Keralites Association 11th September
Chiswick Book Festival 2016
Bedford Park Festival 2016
Green Days Festival
Stage highlights – ‘Walter and Lenny’ & Shakespeare at the Tabard
Poetry highlight – ‘Poetry of Light’ Evening with Rowan Williams
Musical highlights – ‘Great American Trailer Park’ and Baroque Serenade
Until next year…
New Twitter Account
Hubbard Pegman and Whitney LLP join Santander panel
Hubbard Pegman and Whitney LLP to sponsor Bedford Park Festival
Melanie Neale presented to Her Royal Highness the Princess Royal
Hubbard Pegman and Whitney LLP secures Law Society’s new quality mark.
Please welcome Aaron Newton!
Please welcome Melanie Neale!
Law Society Personal Injury Scheme
The Chiswick Book Festival 2014
Blue Chip Staff Association


Facing Compulsory Purchase of Your Home?
Take Care When Appointing a Non-Lawyer as Your Executor
Court Corrects Parenthood Bungle
HMRC Fail in IHT Challenge on Livery
Flat Tenants – Taking Over Management Can Be a Legal Minefield
Failure to Use Solicitor for Will Leads to Challenge
Insurance Extension on the Cards?
Government Must Prove its Case to Obtain Deportation
Mis-Sold an Interest Rate Hedging Product? Don't Miss the Time Limit for a Claim
Change of Use Over Time Leads to Four-Day Court Battle
Ignoring Advice Not Path to Success
But I Wrote a Cheque
HMRC Aren't Always Right
Take Extra Care When Buying Abroad
Executors and Taxes
Family Proceedings – Anonymity Orders v Freedom of Expression
Power of Attorney or Deputyship?
Couple May Lose House After Denying Neighbour Access to Meter
Tax Domicile – HMRC Upping the Ante?
Denied Divorce Case Heading to Supreme Court
Mutual Will Voids Thirteen Later Wills
Only Gifts Without Reservation Are Effective in Minimising IHT
Don't Delay in Completing 'Formalities'
Parenthood is Not a Trump Card to Avoid Imprisonment
Estranged Daughter Gains Share of Late Father's Estate
Everyone Has a Civic Duty to Assist Judges in Resolving Disputes
What is an 'Existing Building'? – Tax Tribunal Clarifies the Law
Equality of Division of Assets on Divorce Abolished? Hardly
Court Upholds Restrictions on Holiday Homes
High Court Dementia Ruling – Judge Acts to Protect Widow
Private Investors – Beware of Wolves in Sheep's Clothing!
Using Fansites? Take Care What You Say
Court Unsympathetic When Mum Takes Law Into Own Hands
You Can Make Your Council Tidy Up Bad Housing
Don't Litigate Without a Lawyer to Tell You When You're Wrong!
Small Pension Pots – Planning Possibilities
Insurer Must Pay Missing Driver Claim
Skulduggery in Divorce Proceedings Will Do You No Good
Court Rejects Rerun Argument in Property Dispute
HMRC's Tough Approach to Penalty Rejected by Tribunal
Court Rejects Will in a Crisp Packet
Mired In Debt? Get Professional Advice You Can Rely On
Mothers Denied Child Residence Orders
High Court Blocks 'Super-Basement' Extension Plans
HMRC Provide Calculator for New IHT Relief
Managing the Affairs of Missing People Law Passed
Sale of Goods Law Provides Route to Compensation for Holidaymakers
Court Unwilling to Force Family Home Sale
Your Right to Claim Tax Relief on Losses Dies With You
Car Bonnet Will is Valid, Rules Court
Couple Ordered to Demolish House Built Without Planning Permission
Put it in Writing
Failure to Take Advice Proves Costly in Family Arrangement
Have You Checked Your Investment Adviser's Credentials?
Power of Attorney Fees Fall
Danger of Subletting Exposed as Court Orders Flat Sale
Uninsured Drivers and Compensation Claims
Tax Law No Respecter of (Cultural) Tradition
High Court Encourages Social Workers to Make Use of Facebook
Cocktail of Drugs Not Sufficient to Overturn Will
Noise Is Not the Only Form of Disturbance – High Court Ruling
Indemnity Insurance Comes to the Rescue in Identity Fraud Case
Financial Advice to Become More Common?
Giving Up Your Career to Get Married? Think Twice!
Assets of Elderly Are Target of Wrongdoers
Court Urges Simplification of 'Right to Manage' Rules
Bank Mistake – HMRC Still Levy Penalty
Divorce: Asset Division Not Always Equal
Accountant Forged Mother's $50 Million Will
Probate Charges Increase Likely to Be Delayed
Charity Report Highlights Need for Trustee Vigilance
Definitive Plan Decides Boundary Dispute
Tax Penalties Avoided for Those Affected by IT Glitch
Court Enforces Pre-Nuptial Agreement
Problems for Family Unaddressed as People Still Shun Wills
Driver Need Not Enforce Wheelchair Space on Bus, Rules Court
Failure to Reveal All Proves Costly for Developer
Woman Aged 96 Wins £223,000 for Negligent Investment Advice
Court Corrects Bureaucratic Nightmare for Family
Solicitor Evidence Crucial in Proving Will Valid
Unexplained Delay Denies Right to Give Evidence
Tax Evasion Assistance – Changes in the Law
Carrying Out Building Works? Consult Your Neighbours First!
Massive Increases in Probate Charges on Large Estates on the Way
Supreme Court Overturns Daughter's Will Claim Award
New Powers Proposed to Make Family Financial Settlements Effective
Attorney Who Forged Will to Accelerate Inheritance Given Jail Term
Where is a Taxpayer 'Ordinarily Resident'?
Housing Association Tenant Pays Price for Unlawful Subletting
Bankruptcy Can Be a Fresh Start – But Only For Those Who Cooperate!
Court Orders Must Be Obeyed – But Caring Pensioner Was Wrongly Jailed
Investment Opportunity? Take Advice First
Changes in Trustees – Who Appoints New Trustees?
Expert Resolution of Boundary Dispute 'Final and Binding'
IVAs and Mental Capacity – Test Case Ruling
Reliance on Accountant's Advice Prevents Penalty
Trustee of Deceased Bankrupt Cannot Claim Payment From Spouse
Lack of Diligence Costs House Purchaser
Court Rejects Unprovable Claim of Property Gift
Council Held to Account Over False Claims

Home ownership is generally regarded as providing safety and long-term security, but this is not always the case as properties can be compulsorily purchased by public authorities to make way for socially beneficial developments. Any householders affected are entitled to be compensated at the full market rate, although in a recent case it took a court appearance to ensure this.

The case concerned a maisonette that was on the ground and first floors of a tower block that was built in the so-called ‘brutalist’ style in the 1970s. The block and others on the city housing estate had been compulsorily acquired by the local authority to enable a wholesale redevelopment of the area. The council and the maisonette’s owner could not agree on the appropriate level of compensation payable and the matter was therefore referred to the Upper Tribunal (UT) for determination.

The owner argued that at the date of the compulsory purchase the property had an open market value of £300,000. The council contended for a figure of £235,000. After considering prices fetched by comparable properties, the UT assessed the value of the maisonette at the relevant time at £286,000.

The council had already agreed to pay the owner compensation in respect of the loss of his iPhone in the course of possession being taken of the maisonette. However, no award was made in respect of other items of his property that had been disposed of by the council. He had been aware of the date on which he was required to move out and had taken no steps to salvage those items.

He was, however, entitled to compensation for the loss of his home equivalent to 10 per cent of the open market value. In addition, he was awarded a £7,470 disturbance payment to reflect the costs of acquiring an alternative home. The owner’s total award therefore came to £322,070.

When you appoint a solicitor to be the executor of your will, you can be assured that they will understand their duties and can be relied upon to comply with them. However, as a High Court case showed, the same sadly cannot always be said of friends or family members who are chosen to perform the role.

The case concerned a woman who died in her 70s, leaving an estate valued at more than £240,000 that was left in equal shares to a friend and a neighbour. Her will appointed the neighbour’s boyfriend as her executor. The principal asset of the estate was her home, which was later sold by the executor, realising a net sum of about £220,000.

Half of that sum should have been distributed to the friend in accordance with the pensioner’s will, but she did not receive any money. After taking legal advice, she launched proceedings and a judge ordered the boyfriend’s removal as executor. The friend replaced him as administrator of the estate.

He was also ordered to pay her the money due to her and to disclose documents relating to the whereabouts of the missing funds. He failed to comply with the orders and only at the eleventh hour did he disclose a bank statement, which revealed that all but £1,300 of the proceeds of the house sale had been spent on supporting his own lifestyle.

In the circumstances, the boyfriend admitted contempt of court and was warned by a judge that he faces a significant custodial sentence. He was, however, given a final opportunity to provide a full explanation of what had happened to the money and sentencing was adjourned for a month.

When a same-sex couple undertook fertility treatment which led to the birth of a baby girl, the intention was that both would be listed as her legal parents. However, due to mistakes made in processing the necessary forms, only one of the couple was shown as a legal parent.

An application to the family division of the High Court was necessary for the mistake to be put right.

Official mistakes are generally able to be corrected, and preferably the rectification process should begin as quickly as possible after the error is noticed.

HM Revenue and Customs (HMRC) have challenged a number of property-based trading businesses, seeking to deprive them of the Inheritance Tax (IHT) and Capital Gains Tax advantages that are normally available.

In a recent case, HMRC sought to persuade the First-tier Tribunal (FTT) that a 30- acre land holding, operated as a livery stable, was not ‘relevant business property’ for the purposes of Business Property Relief (BPR), which provides relief from IHT on the transfer of relevant business assets. Agricultural property also attracts relief in the same way and HMRC also rejected the contention that the property qualified on that basis.

Under IHT law, property that is relevant business property is valued at nil for IHT purposes, so passes free of tax to the beneficiaries under a deceased owner’s will.

The property concerned was worth more than £300,000 and would carry an IHT charge of over £120,000 if BPR were not applicable.

There was no dispute that the property had been used by the deceased for operating a business. However, HMRC took the view that it was ‘a business which consists mainly of holding investments’. If that were the case, BPR would not apply.

HMRC’s argument pointed to the fact that each horse only received about ten minutes per day of ‘one-to-one’ time and to the very modest profits of the business as indications that the land was being held for investment returns, not used in the furtherance of a ‘real business’.

As in all cases of this type, the decision was made on the specific facts. In this instance, the owner of the livery stable provided services (such as worming and providing a daily check of each horse’s health) which went beyond the provision of simple letting of grazing land plus stabling. HMRC’s challenge therefore failed.

The view of the FTT was that the Inheritance Tax Act 1984 ‘is essentially driving at businesses which can properly be characterised as investment businesses, that is, where there is little or no element of trading or the provision of services in consideration of monies received’.

What is of importance is that the HMRC challenges in recent cases do seem to stress relative lack of profitability as an indicator that BPR should not apply.

Most leaseholders would like to obtain the right to manage their own premises. However, as one tribunal case shows, there are many potential pitfalls, so seeking professional legal advice is always a wise precaution.

The four qualifying tenants of a block of flats had set up a ‘right to manage’ (RTM) company with a view to exercising their right to take over the block’s management under the Commonhold and Leasehold Reform Act 2002. Their attempt to do so was, however, determinedly resisted by their landlord.

As all four tenants were members of the company, there was no need for them to be formally invited to participate in the process. However, the Act required that the company serve each of them personally with a copy of the claim notice. The landlord argued that that had not been done and that the failure to follow the procedures laid down by the Act to the letter had undermined the entire process.

Those arguments were, however, rejected by the First-tier Tribunal on the basis that the tenants had all been served with the claim notice by email. In dismissing the landlord’s challenge to that ruling, the Upper Tribunal found that email was a valid method of service. Even had that not been the case, service by email had caused no prejudice to the landlord and would not have automatically invalidated all subsequent steps in the process.

Charities are generally thought of as being mild and benevolent organisations and in many ways they are, but some can also be very aggressive when they are expecting to receive money from an estate and their hopes are dashed.

The extent to which some will go is illustrated by a challenge to the will of a woman who died of cancer. The will left her estate to her partner so that he could provide a home for her three much loved pet dogs.

She made the ‘home-made’ will in 2014 and had it witnessed by two neighbours. It left her whole estate to her partner, who was unaware of this until after her death.

The ongoing legal battle stems from the fact that the woman had made an earlier will in 2007 which gave her entire estate to three animal charities and a health charity. These decided to challenge the later will in a bid to benefit from her £340,000 estate.

It has yet to be seen which way the decision will go, but the lesson to be learned is clear: if you wish to change your will, it is always best to use a solicitor to draft the new one. This not only ensures that there are no procedural irregularities but also means that the solicitor can be called upon to give evidence regarding the advice on the will and the mental fitness of the person making it. In cases like this, such testimony is often crucial.

Under UK law, it is compulsory for all vehicles that are used on public roads to be insured, and third-party liability insurance, which covers accidental injury to others, is the legal minimum. There is even a compensation scheme, funded by UK insurance companies, for when the person who caused the accident was driving without valid insurance.

However, in a recent case involving injury caused by a tractor being used on private land in Slovenia, the European Court of Justice ruled that the risk of injury should have been covered by insurance. This could mean that all vehicles – including those not intended to be used on public roads – will need insurance, at least until the UK leaves the European Union.

Insurance industry sources are highly critical of the judgment, pointing out that as well as the extra cost of the insurance, any effective enforcement regime would be extremely expensive, as it would involve policing activities happening on private land and there is no database of the vehicles concerned.

Vehicles which may be affected include ride-on lawnmowers, golf buggies, mobility scooters, go-karts and quad bikes.

Marriages of convenience are normally entered into in order to give one of the spouses the right to remain in the UK. At present, EU citizens normally have the right to remain in the UK. However, that right can be removed if it is shown that it has been exercised abusively – such as by entering into a marriage of convenience.

In these circumstances, the deportation of both parties is the normal response.

The main issue in such cases is whether the marriage was in fact a marriage of convenience, and a recent case in the Supreme Court dealt with the burden of proof that this is so.

It involved a Pakistani ex-student who had overstayed his student visa and who sought to gain the right to remain in the UK as he was planning to marry a Lithuanian woman. They were separately interviewed by Home Office officials, who subsequently served both of them with notices that they were liable to removal from the UK, in his case for overstaying on a temporary visa and in her case for attempting to enter into a marriage of convenience.

The appeals launched by the couple were regarding the burden of proof required, as the charge is effectively one of fraud. They argued that the officials had failed to look at the totality of the evidence regarding their relationship and had wrongly placed the burden of proof on them to show that they were not entering into a marriage of convenience. They contended that it was not up to them to show that they have a ‘genuine and lasting’ relationship but for the Home Office to show that they do not.

The Court agreed, but sent the case back to the First-tier Tribunal for a full rehearing.

Mis-selling of interest rate hedging products (IRHPs) by lenders has caused acute financial pain to a great many businesses and individuals and, as one High Court case shows, you should contact us immediately if you have the slightest suspicion that you may be among the legion of victims.

In 2002 and 2004, a bank lent more than £6 million to two property companies in the same group on condition that they enter into IRHPs. Falling interest rates meant that the IRHPs represented a very bad bargain for the companies, which suffered severe financial difficulties as a result. By January 2012, however, the cost of breaking free from the IRHPs stood at more than £500,000.

The companies launched proceedings against the bank in 2016, claiming a total sum in damages of approximately £48.3 million for the losses they had suffered as a result of the IRHPs having been mis-sold to them. They alleged, amongst other things, that the bank had been negligent in giving flawed advice as to how the break costs would be calculated and on the availability of other hedging products.

In dismissing the companies’ claims, however, the Court invoked the three-year time limit rule that applies to negligence claims by operation of the Limitation Act 1980 and held that the proceedings had been launched too late. The Court found that the companies had actual knowledge that they might have a viable claim against the bank by the middle of 2012. Summary judgment was entered in the bank’s favour.

Rights of way over land are a constant source of dispute and, because the law relating to land is complex, such disputes all too frequently end up in avoidable court proceedings.

A recent case heard by Bristol County Court was brought by a man who claimed a right of way over his neighbours’ land. This was necessary in order for him to reach another piece of land – over which there was an explicit right of way – so that he could access the highway.

The argument related to two properties in Wincanton, one fronting the street, Number 17 High Street, and a cottage behind it. Neither property has access to the High Street. The two properties were in common ownership until they were split in 1999. In 1982, the owner had sold a parcel of land behind the cottage to the local authority for the creation of a public car park. The local authority granted a right of way benefiting both properties over the land sold in order to provide access to the highway via the car park. The owner and his successors in title were also granted the right to park in the car park for the purpose of loading and unloading only.

The cottage was sold in 1992, at which time the owner of Number 17 retained for himself a vehicular right of way over a yard that was part of the cottage’s land so that he could continue to access the right of way over the local authority land. Since that time, both properties have changed hands.

What made the case somewhat unusual was that the document ‘reserving’ the vendor’s right of way over the yard had referred to access to a garage at the rear of Number 17. This had long since been demolished and the current owners of the cottage therefore claimed that as the purpose for which the right of way was created had ceased to exist, the right no longer existed.

The owner of Number 17 became upset when the family living in the cottage put plant pots and various other items in the yard, gradually making it more difficult for him to exercise the right of way.

Over time, the use of the yard became the source of an extremely fractious relationship between the neighbours, leading to the repeated involvement of the local police.

That in turn led to the argument about the nature of the right of way and the proper boundary between the properties, which had run along the edge of the (now demolished) garage. The land in dispute has a width of less than five feet.

Court proceedings lasting four days were required to decide the matter. The decision stressed that when the property was split, the original vendor wished to retain as many rights over the yard as he could for himself. A narrow interpretation of the rights of access over the yard would not, therefore, have acceded to his original intentions.

The decision also relied heavily on both the Ordnance Survey maps of the area and contemporaneous photographs. In addition, the behaviour of the two families over the years was highly significant.

Overall, the judge found that the right of way was established and that the owners of the cottage had ‘attempted to take, little by little, more and more of the claimant’s rights away from him’.

There really is little point in instructing lawyers to represent you if you do not then listen to their advice. In one case which illustrates this, two women dispensed with the services of not just one but two legal teams, after they were advised to discontinue their legal fight, and persisted in mounting an utterly pointless challenge to a matriarch’s will.

The women were the daughter and granddaughter of the deceased woman, whose will divided her property equally between her 12 children. The two women had lived with her and were determined to stay in her home after her death and to pay no rent. They objected when the executor of the estate launched proceedings to take possession of the property so that it could be sold and the proceeds divided among the beneficiaries.

The women challenged the will’s validity on a wide variety of grounds and argued that it had not made reasonable provision for them. However, they ultimately put their signatures to a settlement, whereby they agreed to withdraw their claims on the basis that their costs would be paid from the estate. They also agreed that they would not defend the possession action.

Notwithstanding the settlement, the women continued to resist attempts to move them out of the home and made numerous wild and scurrilous allegations against solicitors and barristers whom they had previously dismissed. The High Court noted that those allegations appeared either baseless or irrelevant to the issues in the case.

In granting the orders sought by the executor, the Court observed that, even had the women’s challenge to the will succeeded, it would not have made one iota of difference to their position. Had the woman died intestate, her property, including her home, would still have passed in equal shares to her children. The women were bound by the terms of the settlement and, by remaining in the property rent free, they had perpetrated a great injustice on the other beneficiaries of the will.

It is not often that the facts about how much of a mortgage was repaid are a matter of dispute, but in a recent case that was what happened and the decision led to a judge being criticised for her unorthodox approach to the evaluation of evidence.

A couple owned a house which they had bought with the aid of a mortgage of £200,000. They subsequently remortgaged the property. When the husband died, the mortgage became repayable and the lender sought repayment of the whole sum. When that was not forthcoming, the lender began proceedings for possession.

By the time the proceedings came to court, a total of more than £355,000 was sought by the mortgage company. However, the judge in the lower court awarded the lender only £200,000. She reviewed a number of cheque stubs for payments made to the lender (and some blank), some of which appeared in the accounts of the lender as loan repayments and some of which did not.

The judge took the view that three of the cheque stubs were for loan repayments and that the lender’s record of account was in error in not including them, so the lender’s calculation of the balance due in excess of the original £200,000 could not be relied upon.

Accordingly, the woman and her son were given time to pay off the loan of £200,000, which was within their means. The lender appealed against the decision.

The High Court concluded that the evidence on which the judge had based her ruling simply did not support her finding that the three controversial cheque stubs related to payments received by the lender and gave judgment for the lender for the full sum sought.

As £355,000 was more than the woman and her son could afford, the lender was granted a possession order.

According to the Government’s GOV.UK website, if you are a company director, you have to file a tax return every year. It says that every UK company director must send in a personal self-assessment tax return annually, and that this must be done even without prompting from HM Revenue and Customs (HMRC).

HMRC took that as authority to levy £1,300 in penalties on a company director who failed to file his tax return for the year 2014-2015 until it was several months overdue. He was not a native English speaker and had received no tax return to fill in nor, until a late stage, any correspondence or reminders from HMRC that filing a return was necessary – for the simple reason that HMRC do not send them.

The man appealed against the penalties and the case came before the First-tier Tribunal (FTT). HMRC ran into a significant problem when the FTT ruled that their claim that ‘as a company director one of the appellant’s responsibilities is to register for self-assessment and send a personal self-assessment tax return each year without prompt or reminder from HMRC’ was wrong as it was not backed up by any legislative requirement to do so.

HMRC had eventually sent a notice that a tax return was expected. However, the taxpayer had moved during the relevant period and claimed that he had not received it.

The FTT accordingly cancelled the penalties.

The case is particularly interesting for two reasons. Firstly, HMRC went all the way to the FTT on the basis that guidance on a government website had legal effect, which was clearly not the case in this instance. Secondly, the man asked at the hearing if he could give evidence himself via a translator. The strict procedure in such cases is that HMRC must be informed in advance so that they can bring an independent translator of their own. Notification was not given and HMRC refused to accede to his request, which seems unduly harsh.

The impression one gets is that HMRC are willing to use every trick in the book to collect what seems to be a minor penalty. One might surmise that the motivation for pursuing this case was that if they had won, they could have used the ruling to justify taking similar actions in the future.

A word of caution…the FTT ruling states explicitly that ‘if a person receives a notice to file a return he is under an obligation to file a return by the due date’. However, just because HMRC take a view on your tax matters does not mean they are right, nor does it mean that they will not seek advantage in the interpretation of the rules.

It is estimated that more than 800,000 Britons now own property abroad. What used to be highly exceptional may now seem rather commonplace, but that is no reason why buyers should relax their vigilance over the process. In particular, it is absolutely vital to employ solicitors who are of good repute and entirely independent of the vendors.

One case that resoundingly proves the point concerned a development of luxury homes in Italy that was alleged to have been a money-laundering front for the IRA and the Mafia.

Almost 200 UK and Irish purchasers had paid deposits of up to £105,000 for seaside homes that had been marketed ‘off plan’ in glossy brochures but had yet to be built. After allegations that the project was connected to organised crime emerged, the development was investigated by the Italian police. Only a small number of units were ever completed and the purchasers lost their deposits.

In order to recover their money, the purchasers launched proceedings against a firm of Italian solicitors that had offices in England. The firm, which had purported to give the purchasers comprehensive legal advice in respect of their investments, had become involved at the behest of agents who were engaged in selling the properties, one of whom was said to be a convicted IRA terrorist.

A judge found that the firm had breached the duties it owed the purchasers in numerous respects. Amongst other things, it had failed to ensure that the proper guarantees and planning permissions were in place before parting with its clients’ money. It had failed to reveal to the purchasers the substantial commissions that were being paid to the selling agents or to alert them to the risks of organised criminal activity in the region of Italy concerned.

Having acted in breach of trust, the firm was ordered to compensate most of the purchasers to the full amount of their deposits. The compensation paid to some was limited to the part of their deposits that had been paid to the agents. In dismissing the firm’s challenge to the judge’s ruling, the Court of Appeal could detect no error of law in his conclusions.

An executor of an estate is personally responsible for his or her actions, so as well as there being significant duties, on occasions the role can also involve significant risks. One example of this would be where an executor completes the estate administration and distributes the assets only to find that there was an unknown liability of the deceased, or an estranged relative brings a claim for financial provision to be made for them under the Inheritance (Provision for Family and Dependants) Act 1975.

One of the principal duties of the executor is to ensure that the tax affairs of the deceased person are properly wound up. Normally, this involves submitting a tax return for the deceased which covers the period from the previous 6 April until the date of death. However, if the deceased person’s tax affairs were not up to date, tax returns for the ‘missing’ years may need to be completed.

The executor will also be responsible for submitting an estate tax return or returns for the period of the administration of the estate. This will not normally be required by HM Revenue and Customs (HMRC), however, if the following criteria are met:

  • The gross value of the estate is less than £2 million;
  • The total tax liability for the whole of the period of administration is less than £10,000;
  • The gross proceeds of sale of capital assets is less then £2.5 million in any one tax year;
  • The estate is not regarded by HMRC as a ‘complex estate’; and
  • The estate administration is completed within two years.

In such cases, a simple summary will suffice, with any tax being paid once HMRC have issued a payslip. Where the income from an estate is very low, HMRC will often waive the need for any filing to be made.

The tax rules applicable to estates are not identical to those that apply to individuals, so if there is significant income or capital gain, or the estate administration period is extended, it is essential to obtain professional advice.

It should also be noted that where a beneficiary inherits an income-producing asset, the income produced by that asset is attributable to the beneficiary from the date of death of the deceased, not from the date that the asset is formally transferred to them from the estate. In this case, the executor of the estate is responsible for paying tax on the income for the period prior to the asset transfer and will withhold basic rate tax on it. The income only becomes assessable on the beneficiary when it is actually received.

The person or persons entitled to the balance of the estate after specific bequests have been made are the ‘residuary legatees’. They are taxed on any estate income passed to them in the relevant financial year. In the year the administration of the estate ends, they will be taxed on the income they have received and the accrued undistributed income.

The above is a somewhat simplified outline of how the estates of deceased persons are taxed.

Family courts routinely grant anonymity to children involved in care proceedings, but that inevitably has an effect on parents and others who might wish to publicise their objections to judicial orders. Exactly that issue arose in one case in which a couple’s freedom of expression rights prevailed against a local authority’s attempt to use an anonymity order, made when a court ruled that the couple’s children should be taken into care, to prevent them from seeking to gain support for their opposition to the decision.

A judge had made care orders in respect of the couple’s four children and opened the way for the adoption of the two eldest. The couple’s response was to publish a petition on a popular website, addressed to Parliament and the Prime Minister. It criticised the judge’s decision and asked supporters to ‘please help stop the adoption of my two beautiful children’.

The local authority that had brought the proceedings sought an injunction against the couple, requiring them to take down the petition on the basis that it breached the court order banning identification of their children. It was argued that the petition violated the children’s human right to respect for their privacy and family lives and that the publicity was inimical to their welfare.

In ruling on the issue, the High Court noted that the couple had agreed to take down information that they had published about the case on social media. They had also consented to removal of the children’s photographs, names and ages from the petition. The council, however, argued that that did not go far enough and that the petition should be deleted from the Internet in its entirety.

In permitting the petition to remain online in modified form, however, the Court noted that its removal would self-evidently conflict with the parents’ freedom to express their opposition to the judge’s ruling. The older children were well aware of the care proceedings, and that their parents did not agree with the judge’s decision, and the petition was unlikely to disrupt efforts to find adoptive placements for them. There was very little cogent evidence that the children would suffer embarrassment or emotional harm if the petition remained in place.

The Court emphasised the importance of the principle that those citizens whose lives have been affected by state intervention should be able to protest publicly if they contend that they have suffered an injustice. In the present case, the couple had been the subject of public law proceedings under the Children Act 1989 and it would be disproportionate to compel them to remove the limited amount of information that would still be contained within the petition.

In the same week that a former policeman was convicted of stealing a house and £200,000 from his disabled cousin by abusing a power of attorney in his favour, a judge advanced the case for using a court-appointed deputy to manage the affairs of a person who is no longer able to manage their own, instead of creating a lasting power of attorney (LPA).

It is true that giving a power of attorney (an LPA or the older enduring power of attorney, which is no longer available) over one’s financial affairs does carry a risk, because on rare occasions attorneys do abuse their power and deplete the assets of the person who appointed them. The fact that doing so is a criminal offence is likely to be of little comfort as the probability of restitution is normally low.

However, there are ways that risk can be minimised. As well as taking care to ensure you only appoint a trustworthy person to act as your attorney, you can appoint multiple attorneys and ensure that none can act unilaterally. You can appoint a professional attorney (who will have professional indemnity insurance) to act as attorney or co-attorney to make sure that matters are dealt with properly.

The chief disadvantage of making an application to the court to appoint a deputy is that the procedure is rather slower and will normally end up being considerably more expensive to administer over time.

Disputes between neighbours can blight the lives of all concerned and it is always wise to seek legal advice before matters get out of hand. In one case, an elderly couple face losing their home under the weight of legal bills following a long-running row with their neighbour over her access to a utility meter.

The meter was attached to an exterior wall and the neighbour could only access it by going onto the pensioners’ land. They denied her access by erecting a gate that they kept locked. After she launched proceedings, a judge found that she had the right to inspect, read and maintain the meter and directed the couple to either remove the gate or provide their neighbour with a key.

The judge was highly critical of the pensioners’ behaviour – referring to the woman as a spiteful troublemaker and to her husband as bombastic – and, after ruling against them on every point, ordered them to pay the legal costs of the case, a six-figure sum that has since been secured against their home.

In dismissing the couple’s challenge to the judge’s decision, the Court of Appeal could detect no flaw in his approach to the case. That the woman should have access to her own meter was obvious and the contrary view was absurd. The Court observed that, whereas most neighbours would have found a sensible solution to the dispute, the couple had taken their stand on what they considered to be their strict legal rights. To their great cost, they were wrong about those rights.

The Access to Neighbouring Land Act 1992 and other legislation gives the right of legal access over land in appropriate circumstances even if there is not an ‘easement’ registered over the property.

With an increasingly peripatetic workforce, more and more people are finding that the issue of their fiscal residence has a significant effect on their tax position.

The response to this in the UK has been that tax legislation surrounding residence has been tightened up considerably over the years in order to bring more people into the UK tax net. It would also be fair to say that HM Revenue and Customs (HMRC) have become more argumentative regarding tax matters than used to be the case, even vigorously pursuing several cases which had very weak legal bases.

There are signs that HMRC’s next area of focus may well be Inheritance Tax (IHT), for which a person’s domicile is the key concept. Domicile is not the same as residence, which can be temporary: it is more akin to ‘where you belong permanently’. Domicile is a largely subjective concept and, accordingly, the factors that determine it are many and often complex.

A recent case regarding domicile illustrates that HMRC do not regard themselves as bound by informal decisions made in the past, no matter how unfair that may seem.

It involved a UK citizen who has worked in several locations across the globe. In 2002, his tax advisers asked HMRC for a ruling on his place of domicile as by then he had lived abroad for many years. He contended that he had acquired a foreign ‘domicile of choice’ some years previously. This request was made in the context of a transfer of funds which would have created a relatively small IHT liability were he to be UK domiciled. He was in fact resident again in the UK when the transfer took place, but had the intention to return to Hong Kong.

HMRC accepted that no IHT was due, which he took to mean that HMRC accepted that he had acquired a foreign domicile.

In the event, he never returned to Hong Kong but remained in the UK. More recently, his tax affairs led HMRC to look again at his domicile and, having raised an enquiry into his 2014 tax return, they then proceeded to ask him questions relating to events as far back as 1981.

HMRC contend that their acceptance that no IHT was due on the transfer was pragmatic, rather than an acceptance of his assertion that he had acquired a foreign domicile of choice.

Thus far the argument has only reached the First-tier Tribunal, which ruled that HMRC did have the right to require information to ascertain whether the man had acquired a foreign domicile of choice prior to 2002 and also whether that domicile had been lost subsequently.

The decision is likely to be appealed, so cannot be taken as definitive.

The lesson to be learned is that if HMRC make a decision, nothing more should be implied into it than what is specifically agreed. In this case, HMRC never said that they agreed that the man had lost his domicile of origin, just that they accepted no tax was payable.

Secondly, it is best to retain records. One can only imagine how much paperwork a person whose job took them to the other side of the earth and back would have retained as evidence of what they did more than three decades ago.

It has been revealed that the widely reported case last March in which a wife was not granted a divorce from her husband because she could not demonstrate that his behaviour had been unreasonable will be decided by the Supreme Court.

Under English law, there are only five grounds under which divorce can be sought.

These are:

  • adultery;
  • desertion;
  • separation for two years where the spouse consents;
  • separation for five years without the spouse’s consent; or
  • unreasonable behaviour.

In the case in point the first four criteria did not apply, and the wife therefore sought a divorce on the ground of her husband’s unreasonable behaviour. In such cases, the person seeking the divorce must show that the spouse ‘has behaved in such a way that [he or she] cannot reasonably be expected to live with [him or her]’.

The husband opposed the divorce application. Other than perhaps his refusal to accede to her request for a divorce, his behaviour was, in the view of the Court of Appeal, not sufficiently unreasonable to grant a divorce, despite it being clear that the marriage had broken down. The husband claims that the breakdown is not irretrievable and, since they have not yet been separated for five years, the termination of the marriage now would require that unreasonable behaviour be proved.

The wife’s evidence alluded to her husband prioritising work over family life, making her feel unappreciated because he had not provided her ‘with love, attention or affection and was not supporting of her role as a homemaker and mother’, their having arguments and his having embarrassed her by chastising her in front of others.

However, the Court of Appeal, noting that Parliament had not set the law to allow ‘divorce on demand’, concluded, in the words of Lady Justice Hallett ‘with no enthusiasm whatsoever’, that the marriage must, in the absence of the husband’s agreement, continue until the separation has lasted for five years.

The circumstances in this case are very unusual, although divorces that are fractious are not.

Although a worryingly high proportion of the population never make a will, a fairly large number of those who do make more than one. It is sensible to make a new will or add codicils to an existing will if your circumstances change significantly. However, some people do take the process to extremes, as is evidenced by a case involving the estate of a woman who made 13 different wills between 2004 and 2014.

Her final will was admitted to probate in 2016 and its validity was challenged by her two daughters, who each stood to inherit £100,000 more under a will she had made in 2000 than they would under her final will.

The challenge was made on the basis that the deceased woman and her late husband had created ‘mutual wills’ in 2000. Mutual wills create a binding agreement between two or more people which prevents the surviving party/parties from disposing of the estate in a different way.

As the promise made is binding, a subsequent will cannot revoke it. In the case in point, the judge found that the wills were mutual wills and all of the subsequent wills were therefore void.

The practical issue for a survivor who has entered into a mutual will and wishes to change the way their assets are distributed is that they will need to address this whilst alive, as the mutual will determines the distribution of the estate assets on the death of the surviving party to the agreement.

Giving away your assets to the next generation before your death can be an effective means of minimising Inheritance Tax (IHT) liabilities. However, as one tribunal case showed, such gifts have to be absolute and bring you no personal benefit in order to achieve the tax savings desired. Where a gift is made and the person making it (the donor) retains any benefit from whatever is given away, this is called a ‘gift with reservation of benefit’. Such gifts are ineffective for IHT and are treated by HM Revenue and Customs (HMRC) as remaining in the donor’s estate.

The case involved a woman who owned a long lease on a valuable house. She had, with the permission of her landlord, sublet it to her three sons. There was no dispute that that represented a disposal of property by way of gift and that possession and enjoyment of the property had been assumed bona fide by the sons to the entire exclusion of their mother.

On her death, however, HMRC took the view that the gift of the subleases had been subject to a reservation of a benefit within the meaning of Section 102 of the Finance Act 1986. On that basis, HMRC argued that the subleases fell to be treated as property to which the woman was beneficially entitled immediately before her death.

Their value was thus subject to IHT. Why did HMRC take that view? Because the subleases granted to her sons contained covenants to maintain and repair the property.

A challenge to that decision, brought by the executor of the woman’s estate, was rejected by the First-tier Tribunal, which accepted that the mother had retained a benefit because by taking on the repair obligations, the sons had relieved their mother of her duties under the head lease to perform them herself.

In rejecting the executor’s appeal against that ruling, the Upper Tribunal found that the sons’ obligations under the subleases were for the ‘better enjoyment’ by their mother of her retained interest in the head lease. The covenants they entered into, which mirrored those in the head lease, gave her greater protection than she would have enjoyed had she simply remained subject to her own covenants without imposing any corresponding obligations on her subtenants. That was a benefit she had reserved and the value of the subleases therefore remained in her estate.

There is a tendency to think that procedural matters are mere formalities and there is no need to be in a rush to dot the i’s and cross the t’s, but sometimes failing to deal with them promptly can cause significant problems, as a recent case involving a seemingly simple administrative issue after a property purchase shows.

The property purchase was completed in January 2012 and the sale of the land did not reserve a right of way for the adjacent land, which was retained by the vendors. Due to a series of minor issues, the transfer wasn’t registered at the Land Registry until May 2012.

A short while after the initial sale, the vendors also sold the land they had previously retained. That transfer showed a right of way over the land that had been sold beforehand. The title of the land that had originally been retained was registered in March 2012, so when the title of the first piece of land sold was registered, the right of way was shown in the record of title of that land.

Inevitably, a dispute arose over the validity of the right of way. The legal position as regards the transfer of land was that the buyer of the first piece of land had become its beneficial owner on completion in January 2012. However, the legal interest at that stage was what lawyers call ‘equitable’ only. The question the High Court had to decide (the law is complex in this area) was whether the buyers of the land which had originally been retained by the vendor and then sold to them had a legal interest (the right of way) that ‘overreached’ that of the buyer of the first piece of land.

After a series of different arguments were made, the High Court ruled that the first buyer’s interest was overreached and the right of way was valid.

Had the registration of title on the first sale been completed before that of the second, the right of way would have been invalid.

Imprisoning parents is inevitably traumatic for their children, and striking a balance between child welfare and appropriate punishment of criminals is a dilemma confronted by judges every day. However, a Court of Appeal ruling has emphasised that parenthood is not a trump card that can be played to avoid jail.

The case concerned a prison officer who had admitted smuggling large quantities of contraband, including cannabis and mobile phones, to inmates at the institution where she worked. She was spared jail and given a suspended two-year sentence, largely due to her responsibilities to her two young children.

The sentence was challenged by the Solicitor General on the basis that it was unduly lenient. The Court acknowledged that the welfare of the woman’s children was a primary consideration. However, the seriousness of her economically motivated crimes had to be marked by an appropriate sentence.

The woman was guilty of grave breaches of trust and the prevalence of contraband items in prison is a serious problem, helping to promote criminal economies and power structures. Her crimes demanded a fitting punishment and the Court imposed an immediate prison sentence of two years and eight months.

The dangers of concluding that estranged children who have been disinherited will have no claim against a deceased person’s estate were made very clear after a widely reported case decided last year. They have again been highlighted in a recent case in Leeds County Court, in which the daughter of a man who had been estranged from her for many years successfully brought a claim for a share of his estate under the Inheritance (Provision for Family and Dependants) Act 1975, alleging that ‘reasonable financial provision’ had not been made for her in his will.

The man’s children had had no contact with him for many years. In a note he left for his executor, he justified his failure to give them anything by saying, "I have not seen or heard from any of my children in the last 18 years and I do not believe they have any interest in me or my welfare. All of my children are of independent means and have or have had their own life and family and are, to my knowledge, sufficiently independent of means not to require any provision from me."

He specifically asked his friend to ‘respect my wishes and ensure that they receive no benefit whatsoever’ under his will.

The man had been married twice. He died in 2015 and left his £265,000 estate to his friend. A half-brother of the daughter, who is unable to work by virtue of disability and sickness, made a claim under the Act which was settled by a payment of £22,000.

The daughter had had no contact with her father since 1996, other than for a period from 2007 to 2009 after which they were again estranged. The man did not respond to any communications from her, even putting the phone down on her when she rang him to tell him her mother (his ex-wife) had died. She claimed she had made efforts to rekindle their relationship, which were unsuccessful.

The extent of the rupture between father and daughter is shown by her own evidence that except for the period mentioned, the deceased was ‘not there’ for her. She has had to make her own way in the world without any assistance from him either financially or otherwise.

The daughter lives on a low salary and gave evidence that her outgoings exceed her income by about £300 per month and that she wishes to undertake additional education to qualify as a veterinary nurse.

On the side of the executor and beneficiary under the will, the position is further complicated. He has also had financial issues and used the money he inherited to clear debts. In settling the claim from the half-brother, he had to borrow again and gave evidence that he would need to borrow further to settle any claim by the daughter.

However, the court awarded the daughter £30,000 from the estate.

It is a civic duty to assist the courts in the resolution of disputes, and judges have the power to compel reluctant witnesses to give evidence. Exactly that happened in one case in which a solicitor was required to attend court to testify in respect of a disputed property transaction.

The case concerned a woman’s claim that she had lent a man £250,000 to enable him to purchase a house. The man insisted that the money was a gift. As that was a matter of fact to be decided by the court, the case would hinge on the evidence, and the woman obtained a witness summons that required a conveyancing solicitor who had acted for the man in the purchase to attend court to give evidence in person.

In applying to set the summons aside, the solicitor argued that it had not been issued in good faith, in that the woman’s objective was to impugn his conduct rather than to elicit relevant evidence. He was reluctant to take sides and his attendance at court was in any event unnecessary as he had made a written statement and the conveyancing file had been disclosed to the woman.

In dismissing the application, however, a judge noted that the solicitor had the advantage of being an objective and independent source and was likely to be a most important witness in resolving the factual issues at the heart of the case. The trial judge would be able to prevent questioning that was irrelevant or in conflict with his professional duty to maintain client confidentiality.

The possibility that his conduct might be criticised did not mean that the summons was oppressive. The fact that he was a busy man with a practice to run also did not excuse him from his duty to attend court, and arrangements would be made to ensure that he suffered a minimum of inconvenience.

A property owner who demolishes an existing dwelling house and replaces it with an entirely new one is entitled to reclaim VAT on the costs of construction – but what happens if part of the original building is retained? A tribunal considered that issue in a case that clarified the law.

A company had demolished all but two walls, and part of a third, of a coach house before constructing a replacement that was of greater height and had a larger footprint than the original. Its argument that the costs of construction were zero-rated for VAT purposes – and that it was thus entitled to a rebate exceeding £40,000 – found favour with the First-tier Tribunal (FTT).

However, in upholding an appeal against that decision by HM Revenue and Customs, the Upper Tribunal found that the FTT had erred in its interpretation of the relevant parts of the Value Added Tax Act 1994.

The Act provides that zero rating does not apply to conversion, reconstruction or alteration of an existing building. Subsequent amendments to the statute also stipulate that a building only ceases to be an existing building if it is demolished completely to the ground.

The sole exception to the latter requirement is where the only parts of the original building retained are facades that are required to be kept in place as a condition of planning consent. Parts of the coach house had been left standing and, as the exception did not apply, the relevant works were deemed to be alterations to the existing building and therefore no rebate was payable.

The popular press has made a great deal of a recent Court of Appeal case, reporting that there had been a significant departure from the general principle that the assets built up by a couple during their marriage are to be split more or less equally on divorce.

In the family court, the judge had divided the couple’s assets ‘down the middle’, awarding a wealthy trader’s husband £2.75m of total assets of £5.45m. This led to a challenge by the wife, who had earned the large majority of the money.

On appeal, the husband’s settlement was reduced to the ownership of one of the couple’s two houses plus £900,000 as a lump sum. The total value of his settlement was £2m. His ex-wife was also required to pay £80,000 of his £200,000 legal costs.

The reality is that the circumstances of the case were unusual and also that there have been a number of departures from the equality principle.

In the case in point, the marriage was very short (only six years), the couple had no children and they had maintained their finances completely separately during their marriage.

Furthermore, the wife in this case had received massive bonuses during the time they were married in her role as a trader in the wholesale fuel market.

In his commentary on the ruling of Lord Justice McFarlane, Lord Justice McCombe said, "…statute directs attention to a wide variety of criteria for resolution of matrimonial finance problems, one of which is expressly the duration of the marriage. The principle of equality obviously properly applies to the vast majority of cases as the House of Lords cases have decided, but (not) to the small minority," adding that the facts in this case were ‘confined’.

The old adage that ‘an Englishman’s home is his castle’ is only partially true and the impact of planning law on a property owner’s rights can be far-reaching – even extending to limiting the right of occupation.

This is particularly an issue in areas of the country where there are many holiday homes, as there are often planning restrictions that forbid their occupation all the year round or as principal residences. Although the owners of the homes may ignore them, they are enforceable and, as a recent Court of Appeal ruling shows, it is advisable to take them seriously.

The case concerned a number of properties that lay within a country park. They were subject to a planning condition requiring that they be used for holiday purposes only and must not be occupied as a person’s sole or main residence. All or most of the residents had signed licence agreements that reflected the condition’s terms.

A number of occupants had, however, begun to occupy the homes year-round. The local authority issued enforcement notices that forbade such use and an appeal by residents to a government planning inspector was later dismissed. Retrospective planning permission was also refused and their judicial review challenge to the inspector’s decision was struck out by a judge.

In dismissing one resident’s appeal against the latter decision, the Court rejected arguments that the handling of the case had been procedurally unfair. The inspector had carefully considered all the issues, including the human right of residents to respect for their homes. Permission to introduce fresh evidence was also refused.

Amidst an ageing population, the role of judges in protecting the weak, vulnerable and infirm is of ever increasing importance. In one case that proves the point, the High Court stepped in to set aside land transfers made by an elderly farmer with dementia in the years before his death.

The farmer was well into his 80s when he gave his land holdings to two of his sons. The gifts, which were expressed to reflect natural love and affection, included the home that he occupied with his wife. She was granted no right to remain living there or to financial support from the sons. As a result, she was left with nothing when her husband died.

The widow launched proceedings and, in setting aside the gifts, the Court ruled that the farmer lacked the mental capacity required to validly enter into the transactions. There was evidence that, by the time of the transfers, he had for some years been suffering from confusion and forgetfulness, to the extent that he sometimes failed to recognise members of his family.

The sons argued that their father had given them the land of his own free will, and the Court did reject arguments that they had brought undue influence to bear upon him. Had that been established, it would have been grounds in itself for voiding the gifts.

However, it noted that the transfers were obviously and manifestly to the disadvantage of the farmer and particularly his widow. No explanation had been offered as to why he would have done such a thing to his wife.

The widow had sadly died during the course of the proceedings, but the ruling meant that the land would revert to the farmer’s estate. In a postscript to his decision, the judge noted that the age profile in society is changing and urged particular caution on solicitors when dealing with gifts made by the elderly.

There have always been wolves in sheep’s clothing ready to take unfair advantage of private investors and they can be difficult to spot without professional advice. In one case, a company that participated in the sale of coloured diamonds to the public at inflated prices was compulsorily wound up by the High Court.

The Secretary of State for Business, Innovation and Skills launched proceedings against the company on the basis that a winding up order was in the public interest. Diamonds were marketed as investment opportunities on the company’s website but markups of up to 745 per cent were applied so that purchasers could have no realistic expectation of making a return.

In granting the order sought, the Court noted that the company had failed to cooperate fully with investigators. Through his extensive experience of the diamond market, the company’s sole director and shareholder knew perfectly well that investors would almost inevitably suffer losses through the transactions that it facilitated.

The Court also granted a winding up order against a second company that, at the behest of the first, provided contrived valuations in support of prices that investors had paid. Valuation certificates provided were potentially misleading and confusing and were prepared without sight of the diamonds concerned. Both companies had traded with a lack of commercial probity, contrary to the public interest.

Among football fans it is very well known that the owners and supporters of Blackpool FC are not on good terms. It is also common knowledge that comments on fan websites can be very immoderate at times.

However, a recent case shows that no matter how deep the vituperative feelings are, lack of care when making online comments can prove expensive.

The case involved a comment made by a fan on the ‘Fansonline’ website that a solicitor employed by Blackpool FC’s owners had been struck off. The comment was repeated on another football fansite. The solicitor sued the poster for libel, the claim being untrue and defamatory.

The fan claimed that very few people would have seen his post (it was published in the off season) and that the solicitor had suffered no loss of reputation as a result, because he has no client base which would be influenced by the posting and his employers would take no account of it whatsoever.

However, the Court did not agree and awarded the solicitor £18,000 for the damage to his reputation.

No matter how much you may be tempted, taking the law into your own hands is not a good idea.

When a mother who was divorcing her husband in Hawaii obtained the agreement of the US court to take the couple’s children, aged 9 and 11, back to the UK for a holiday, she completed the first part of the trip but refused to return the children as had been agreed.

Her husband sought, by way of proceedings under the Child Abduction and Custody Act 1985 and the 1980 Hague Convention, to have them returned to Hawaii where a hearing to determine their future residence had already been scheduled.

The mother’s reluctance was on the grounds that, if she did return to Hawaii with the children in order to attend the proceedings, they would face physical or psychological harm and that they wished to remain in the UK with her and were of an age where their feelings should be given weight by the court.

As is common in such cases, numerous allegations were made by each of the parents regarding the behaviour of the other which it was not possible to substantiate.

Despite the fact that the children had expressed a wish to remain in the UK, the judge could see nothing untoward in their father’s proposed arrangements for safeguarding them in the short period before the custody hearing to determine their futures was due to take place in Hawaii. The presiding judge considered that the mother’s objections were ‘flagrant’ and that her ‘action was deliberate and pre-meditated, and that she had actively sought to avoid detection by the father’.

Unoccupied and decaying properties can have a serious impact on the neighbourhood and can become a focus for vandalism and anti-social behaviour. However, as one case showed, local authorities have a range of powers to deal with such eyesores, even if their owners cannot be traced.

The case concerned a 1950s-built three-bedroom house that had been empty for a number of years and was in an advanced state of disrepair. The council had made fruitless efforts to contact the property’s owner, who had apparently disappeared. In response to complaints from local residents, it had spent more than £20,000 on securing the property and clearing its garden.

The council took the view that the only solution was to compulsorily purchase the property and an order was issued to that effect. The council subsequently referred the matter to the Upper Tribunal (UT) for an assessment of the compensation payable to the owner, if he could be found, or his estate if he was deceased.

The UT ruled that, in a fair condition, the property would be worth about £210,000. However, after the expense of necessary renovations and the costs incurred by the council were deducted, compensation was fixed at £140,000.

One reason why it is rarely advisable to represent yourself in litigation is that you need a good lawyer to tell you when you are wrong. That point could hardly have been more clearly made than by a case in which a widower claimed that his sister had made him a deathbed gift of her £900,000 home.

The sister’s substantial house represented almost the entirety of her wealth. She died without making a will and, ordinarily, her estate would have passed in three equal shares to her two brothers and the adult children of her deceased sister as her next of kin. However, the widower claimed that she had given him the house before her death and that it thus did not form part of her estate.

Representing himself before the High Court, he pointed out that he and his wife, now deceased, used to visit his sister regularly to assist with her shopping and care. Her health was failing and he claimed that she was contemplating her imminent death when she gave him the deeds to the house and told him that she wanted him to have it.

In rejecting the widower’s case, however, the Court noted that in 2012 he and his wife had insisted on his sister going into a nursing home, against her own wishes and those of all others involved in her care. In having the house registered in his name after his sister’s death, he had displayed an unwarranted sense of entitlement and a blinkered and shameless disregard for the rights of other members of her family.

The Court found that the alleged conversation with his sister on which he sought to rely had in fact never occurred. He had in any event come nowhere close to proving that she had at the time anticipated her death in the near future. His claim to have been the beneficiary of a deathbed gift was, frankly, hopeless.

People aged over 55 who have only a small (less than £30,000) pension pot in a defined benefit (final salary) scheme or in some instances in a defined contribution scheme paying only a small pension – but not where the pension pot has been used to buy an annuity – can normally cash in such schemes, taking the entire pension pot as a lump sum under the ‘trivial commutation’ and ‘small pots’ rules, which were introduced a few years ago.

The Low Incomes Tax Reform Group (LITRG) has published a guide which outlines the rules which apply in such cases.

In simple terms:

  • Any pension fund cashed in has to be taken in its entirety and funds can be cashed in ‘one by one’ if wanted;
  • Under the trivial commutation rules, the last encashment must take place within 12 years of the first; and
  • Other pension pots of less than £10,000 in value may be able to be cashed in also.

However, when a pension pot is taken as a lump sum, 75 per cent of the sum taken is regarded as income for the purposes of calculating tax credits, and the lump sum released will no longer be disregarded (as pension funds are) in the calculation of means-tested benefits.

Also, a pension fund can in some circumstances be passed directly to a beneficiary if untaken and will thus not be included in your estate for Inheritance Tax purposes. Once the pension pot is turned into cash, this is no longer the case. For more information on this, see the Pension Wise website.

The LITRG has a web page which gives advice to pensioners on common tax issues they face, and also publishes periodic updates, such as recent guidance on the new state pension scheme.

When a person has an accident involving a car and a claim results, it is usually dealt with by the insurer of the driver concerned. If the driver is not insured or is untraced, a procedure exists to ensure a claim can still go ahead, only in this case the Motor Insurers’ Bureau (MIB) is responsible for settling the claim. The MIB is funded collectively by the country’s motor insurers. Claims met by the MIB under the ‘Untraced Drivers Agreement’ are normally paid out in rather smaller amounts than are usual where claims are settled by insurers.

In a recent case, the Court of Appeal dealt with the circumstances in which the driver of a car that was involved in a crash could not be traced, but the car was identified. After the accident occurred, one car stopped but the other did not. The driver who stopped noted the vehicle registration number of the other car. A claim was made against the insurer of the owner of the other car but when it was proved that he was not the driver at the time of the accident, the decision was taken to continue to claim against the insurer, not against the MIB.

The insurer fought the claim as it wanted it to be met by the MIB, not out of its own funds. The legal question was whether a person could sue and obtain an order against an ‘unknown person’ in such circumstances.

The Court of Appeal decided that it could.

On the face of it, this would seem to be a victory for anyone injured in similar circumstances. However, an appeal to the Supreme Court is likely, particularly as the Court of Appeal’s decision was by a majority of the bench. There are cost implications for insurers with regard to fees as well as the claims themselves and, if the decision ‘sticks’, the end result may well be higher motor insurance premiums.

This decision could open the door for claimants to obtain higher settlements in similar cases, by claiming against the insurer rather than the MIB.

Resorting to skulduggery in divorce proceedings is sadly common but almost never does either side any good. That was certainly so in one case in which a man surreptitiously took documents from his ex-wife’s home and sought – unsuccessfully – to rely on them in court.

During their five-year marriage, the couple had lived largely on income from a family trust of which the wife was a beneficiary. After their divorce, it was agreed between them that the husband would receive a total of £68,000 and a car, in full and final settlement of all his financial claims against his wife.

Some years after the end of the marriage, the husband became convinced that his wife had failed to disclose the true extent of her wealth. He claimed that he had not been in his right mind at the time of the settlement and sought further financial support from her. In pursuit of his claim, he had offered to repaint his former wife’s home and taken the opportunity to go through her personal papers and remove any of them that he believed would be helpful to his case.

In dismissing his claim, the High Court ruled that he could not be allowed to rely for any purpose on the documents that he had unlawfully taken. Although they were not kept under lock and key, they were taken from a private home in breach of the wife’s right to privacy. He was at all times aware of the existence of the trust and there was no evidence that he lacked the mental capacity to enter into the settlement. There had been no scheming or non-disclosure by his wife and there was no evidence that he had acted under duress or that she had brought undue influence to bear.

Problems with covenants affecting land are common and sometimes a dispute can resurface years after it seems to have been settled. In a recent instance, a landowner was successful in reopening the battle over a covenant after persuading the court it was not simply a rerun of an old court case.

The property was subject to covenants dating from 1954, which included one binding on the purchaser ‘not to erect on the piece of land hereby conveyed any buildings whatsoever other than one private dwelling house with proper offices and outbuildings (including at the purchaser’s option a private garage)’.

A dwelling had been built on the land in question, but the current owners wanted to build another house on it. They sought a declaration that the covenant should be removed as it was personal and was not transmitted to later purchasers of the property.

An earlier (1978) application to lift the covenant had been made which had been argued all the way to the Court of Appeal. It concluded that the covenant – which was intended to restrict the building density – did benefit other nearby residents and was thus enforceable.

When the argument came back to court, those opposed to the removal of the covenant argued that the claim should be struck out as it was essentially relitigating the same issue. They contended that the case was an abuse of judicial process and that the legal doctrine of ‘estoppel’ should prevent the rehearing of the arguments.

However, the High Court did not agree that the new application was in effect a rerun of the old case, and thus it could not be dismissed without the specific facts being argued.

Just how tough HM Revenue and Customs (HMRC) can be was illustrated by a recent case in which they imposed a penalty of £1,300 for the late filing of a tax return by a businesswoman who, as well as running her own business, was also caring for her two terminally ill parents for four years. Her father suffered from cancer at the time and her mother had had a series of strokes. Both died within months of one another during the tax year in question, following which the daughter was faced with, in her words, ‘the sorting out of everything; the house, the belongings, the estate, Dad’s financial affairs, their pensions etc.’

Her appeal against the fine was submitted late. HMRC wrote to her saying, "The only circumstance in which we can accept a late appeal is if you have a reasonable excuse for not completing the tax return on time. This reasonable excuse must be an unexpected or unusual event, either unforeseeable or beyond your control, which continued for 30 days beyond the receipt of the penalty notice."

HMRC refused to use its discretion to remit the penalty, claiming that her circumstances were not ‘exceptional, abnormal, unusual or something out of the ordinary run of events’ and citing her ability to continue to run her business as evidence that the ‘reasonable excuse’ argument could not apply.

The woman sensibly took her case to the First-tier Tribunal (FTT), which gave HMRC short shrift. In the FTT’s view, "The appellant had to work to support herself and pay the everyday expenses of keeping her home. The fact that she did that and was able to look after her parents in the way described is remarkable."

Unfulfilled hopes of substantial inheritance are commonplace, both in fact and fiction, but not often do they lead to such ham-fisted attempts at forgery as that shown by a disappointed widow after her husband left her just £25,000 of his £600,000 estate.

The woman was 50 years younger than her husband, who died aged 76, and their marriage had been a cause of consternation to his family. By a properly executed will, drafted by a solicitor, he left £430,000 of his estate to his only child by a previous marriage, £140,000 to an old friend and £25,000 to his widow.

After his death, however, the widow produced a purported later will that on the face of it bequeathed all but £50,000 of the estate to her. She said that she had found the document in the attic of her husband’s home, hidden inside an empty packet of crisps. In entering the earlier will to probate, however, a judge found that she had orchestrated an attempted fraud by forging the later document herself.

Describing her account as ridiculous, the judge noted that no explanation had ever been given as to how such an elderly man would have been able to gain access to the loft space or why he would have chosen to secrete his will in a crisp packet. The contradictions in the widow’s evidence were risible and the forgery had been comprehensively exposed by a handwriting expert. The document was also littered with errors, including a reference to the deceased in the attestation clause as ‘her’.

There are a number of factors that may make a will suspicious – for example, a new will created shortly before death which makes changes to the beneficiaries, a will made without the benefit of a solicitor or one which is discovered unexpectedly and so on.

The position of those in debt is normally far from hopeless and much can be done to save them from penury. However, they are particularly vulnerable and, as a decision of the Upper Tribunal (UT) showed, the Financial Conduct Authority (FCA) tries its hardest to ensure that those who give debtors advice observe the highest professional standards.

The case concerned a debt management company that had over 1,000 clients, all of whom were members of a minority group who did not have English as their first language. In return for monthly fees, the company negotiated and administered debt management plans with creditors on its clients’ behalf.

The FCA had given the company interim consent to carry on the regulated activities of debt adjusting and debt counselling. Full consent was, however, later refused after concerns were raised that the company might not be a fit and proper body to be performing such a sensitive role. That decision meant that the company had to cease its regulated activities immediately.

A hearing of the company’s challenge to the refusal was pending before the UT. As a preliminary matter, the company argued that the interim consent should remain in place until the case was decided. It was submitted that it had taken significant steps to address shortcomings in its systems and that the instant withdrawal of its service would prejudice its clients.

In rejecting the application, however, the UT found that the remedial measures taken were insufficient to dispel concerns that focused on the company’s record keeping and the accuracy of advice given to clients. There was a risk that clients’ interests might be harmed if the company continued to provide regulated advice, even in the short term. The UT also declined to restrict publication of the FCA’s decision until after the substantive hearing.

When a couple split up, it is very common for one of them to wish to move away, often to the area where they grew up or have family. This can create significant issues as far as the children are concerned and disputes in such cases are common.

In a recent example, a Scottish court has refused the request of an English woman to move to England with her infant son after opposition from her husband.

The couple are separated but live in the same house, which is owned by the husband. They accept that their marriage broke down irretrievably in 2016. The wife applied to the Scottish Court of Session for an order that would enable her to return to the Midlands, taking their two-year-old son with her.

Her husband opposed the application, arguing that it would be better for their son to remain in Scotland and to continue to be looked after by both parents, albeit separately.

The wife claimed that she was the full-time carer for their son and that her husband’s job often kept him away from home until quite late in the evening. However, her claims were denied by the husband and the judgment contains many pages of accusation and counter-accusation between the two about their respective behaviour.

Scottish law requires that the decision in such cases is made based on consideration of the child’s welfare and, where applicable, his or her wishes. As the child is two, the latter requirement was not in point.

Hearing that the two were planning to sell the family home and buy separate properties, the judge ruled that the child should remain in Scotland with residence shared between the parents. Refusing to make a formal order for residence in favour of one or the other, he commented that the boy ‘is not a prize to be won or lost in this contest. He is a little boy with two parents whose ongoing involvement in his life he has come to expect insofar as a two-year-old child has any expectations.’

In a similar case in England, a judge was persuaded by the arguments put forward by a child’s father and refused the mother’s application for a residence order which would have enabled her to move with their child from London to her home town in the South West, where she had been offered a job.

Basement extensions are increasingly popular, particularly in areas where property prices are high, but are not always looked upon favourably by neighbours. In one case, an objector obtained legal advice and succeeded in blocking plans for a three-storey ‘super-basement’ in a listed Central London home.

The local authority had granted planning permission and listed building consent to the company that owned the property for a basement extension to include a kitchen, laundry, cinema, gym and swimming pool. A subterranean extension had been permitted by an earlier consent but the recent plans were more extensive.

In upholding a judicial review challenge brought by an objector who lived next door, the High Court found that the council had committed a very straightforward error of law in failing to take into account its own policy of disallowing basement extensions of more than one storey, save in exceptional circumstances.

Quashing the planning permission and the listed building consent, the Court noted that the council had approached the matter with the erroneous mindset that it could not refuse permission for a development that had in large part already been approved. Regardless of the earlier planning permission, the new scheme had to be measured against the council’s basement extension policy.

Like many pieces of tax legislation, the ‘additional threshold’ (AT) for Inheritance Tax (IHT) – which, in simple terms, limits the potential IHT charge on high-value residential properties – is a lot more complicated than it looks at first sight.

However, HM Revenue and Customs have helpfully created a calculator which, when combined with other information extracted from the IHT forms, will enable the administrators of an estate to calculate how much AT is available.

Where AT is able to be claimed, it tapers for estates above £2 million. The relief is available where the death takes place on or after 6 April 2017.

With the general election hogging the headlines, the passing of the Guardianship (Missing Persons) Act 2017, which received Royal Assent on 27 April 2017, went almost unreported.

Although the date on which the Act will come into force has not yet been set, it is a welcome addition to the statute books as it will allow the affairs of missing persons to be dealt with by their loved ones. Currently, there is no simple way that allows the affairs of such people to be managed or for many actions to be taken in their absence, and the problems that can result can be severe.

The Act will change this by allowing relatives of a missing person who is domiciled or habitually resident in England or Wales to obtain a ‘guardianship order’ from the court. The order will allow the appointed guardian to manage the missing person’s financial affairs in his or her best interests.

Somewhat controversially, the Act stipulates that a person need only be missing for 90 days before a guardianship application can be made, and in emergencies a shorter period may suffice if ‘a decision is needed, or is likely to be needed, in relation to property or financial affairs of the missing person before the day on which that condition would be met’.

An interesting use of the law relating to the sale of goods helped a couple whose all-inclusive holiday was ruined by gastroenteritis claim compensation from travel group First Choice recently.

They claimed damages under the Supply of Goods and Services Act 1982 on the ground that the food they ate which made them ill constituted ‘goods’ which were transferred from the hotel to them and which were not of satisfactory quality, being contaminated.

Normally, such claims are brought under the Package Travel, Package Holidays and Package Tours Regulations 1992 based on the negligence of the tour operator’s agent (i.e. the hotel). The reason the case was brought under sale of goods law was that there was extensive evidence of the steps taken by the hotel concerned to comply with high hygiene standards and the measures taken were such that it would have proved very difficult to hold the hotel at fault so as to succeed in a claim under the Regulations.

The case went to the Court of Appeal, which ruled that ‘…in the absence of any express agreement to the contrary, when customers order a meal property in the meal transfers to them when it is served’.

The claimants were awarded damages of £24,000.

However, this case does not mean that all holiday illnesses can lead to claims against the tour operators. The causal link must be clearly demonstrated. The ruling specifically stated that ‘in a claim for damages of this sort, the claimant must prove that food or drink provided was the cause of their troubles and that the food was not "satisfactory"…Proving that an episode of this sort was caused by food which was unfit is far from easy.’

Taking legal advice when borrowing for any purpose is important, as a recent case in which a wife faced the possibility of the sale of her home when her husband was made bankrupt shows.

When he faced financial difficulties in 2005, the husband raised a mortgage against the family home in order to provide finance for his professional practice. The house was owned by him and his wife as tenants in common in equal shares. Tenancy in common means that each person owns a specific proportion of the property and the title to the whole is split, so if one of two owners dies, the title to the whole does not pass automatically to the other. The husband therefore owned half of the value of the house.

The husband’s practice failed and he was declared bankrupt in 2011. His trustee in bankruptcy sought a sale of the family home, arguing that his wife had enjoyed a benefit from the loan, because it had allowed his practice to continue to operate, and therefore it should be taken that she had accepted that the burden of the mortgage debt would fall on them both. The trustee argued that couples regard their assets and earnings as a single pool which is shared between them and that the wife should have to show the actual intention that she would not be bound by her husband’s debt for what lawyers call the ‘equity of exoneration’ principle to apply.

The Court of Appeal did not accept the trustee’s argument, concluding that any benefit the wife might have received was too uncertain to justify the idea that her intention had been to share her husband’s financial burden. The way the property ownership had been set up gave her legal protection.

You can claim tax relief if assets that you have acquired become worthless or loans that you have advanced prove to be irrecoverable. However, in a case that will be required reading for tax professionals, the Upper Tribunal (UT) has ruled that the right to claim such losses for tax purposes does not survive your death.

An investor had bought shares in two companies that became valueless and had made a loan of more than £330,000 that had to be written off. He died in a motoring accident before he could claim tax relief on either loss. The executors of his estate sought to claim relief after his death but met resistance from HM Revenue and Customs (HMRC).

The First-tier Tribunal initially allowed the executors’ appeal and found that £40,000 of the loss made on the shares could be deducted from the investor’s income in the year before his death. It also ruled that the executors were entitled to carry forward the loss made on the loan and set it against capital gains in subsequent years.

In overturning those rulings, the UT upheld HMRC’s argument that, in order to claim relief, the shares had to be owned by the investor on the date when they became of negligible value and still owned at the time of the claim. Furthermore, it was the investor, not his executors, who made the loan and the money was owed to him when it became irrecoverable. Only the investor himself could thus have claimed relief.

There are a number of requirements that must be met for a will to be valid and one of these is that the signing of the will must be witnessed by two people who are not beneficiaries.

A recent case before the High Court turned on that point. It was brought by the long-estranged son of a man who died in 2011. The son only became aware of his father’s death in 2015 and brought a claim under the Inheritance (Provision for Family and Dependants) Act 1975 that financial provision should be made for him as he was not a beneficiary under his father’s will. Instead, the will left his estate to his friend and next-door neighbour, who was also appointed his executor. The will was a home-made one and was signed on the bonnet of a car in the man’s driveway.

The son had to apply to the court to proceed with his claim as the statutory time limit that applies in such cases had long passed. When he went to court, however, he contended that the will was not validly created and thus the estate should have been administered as if it had not existed. That would have resulted in the estate being divided between him and his half-brother.

The claim was based on the evidence of an enquiry agency which had interviewed the witnesses to the will. They had given conflicting evidence about the circumstances in which it had been signed. However, after hearing extensive evidence, and levelling considerable criticism at the enquiry agents regarding the manner in which they had obtained the witness statements, the judge ruled that the will had been validly signed. The conflict in the evidence of the will’s witnesses was explained, at least in part, by the fact that one of them suffers from some memory loss due to dementia.

Planning laws are complex and before starting any building work it is always wise to seek professional advice. In one case that proves this point, a couple who almost doubled the size of their country cottage without planning permission were ordered to demolish the entire building.

The couple had knocked down a large part of the cottage and replaced it with a new house that had a floor area almost 70 per cent larger than the original building and an internal volume nearly 100 per cent bigger. The property was in the Green Belt and the local authority’s response was to issue an enforcement notice requiring them to level the building to the ground.

The notice was later upheld by a government planning inspector on the basis that the works had gone beyond merely extending or enlarging the cottage and that the end result was a ‘new’ building that was fundamentally different from its predecessor. Although it did not have a harmful visual impact or interfere with any important views, it was, by definition, harmful to the openness of the Green Belt. The inspector’s ruling was subsequently upheld by the High Court.

In dismissing the couple’s challenge to the latter ruling, the Court of Appeal rejected arguments that the inspector had failed adequately to consider alternatives to the building’s complete demolition. The inspector was entitled to find that it was an integrated whole and could not be split into acceptable and unacceptable parts. The house was an inappropriate development in the Green Belt and there were no very special circumstances that justified its retention.

It is astonishing how often disputes over the beneficial ownership of assets become the subject of lengthy court proceedings. In a case decided in March, an argument about the ownership of a property ended up (at huge cost to the loser) in the Court of Appeal.

The issue was whether the property was owned in accordance with how much the two owners had contributed to its purchase and normal running costs or whether it was owned in some other proportion.

In the absence of compelling evidence that ownership of the property was shared in any other proportion, the Court of Appeal upheld the lower court’s decision that it should be determined by the relative contributions of the owners.

No matter how much you may trust relatives or close friends, you should never sign important documents without independent legal advice. In one case that proves the point, a man put his name to a deed that was put before him by his brother but which eventually led to the forced sale of his £750,000 home.

The man and his brother had used money given to them by their mother to buy a flat. He believed that it would provide a home for him and his family indefinitely, but his brother considered it a development opportunity. Following a conversation in a coffee shop, the man signed a deed that enabled him to live in the flat rent-free and capped his brother’s interest in the property at £367,500.

However, unbeknown to the man, the deed included a provision that either of them could require a sale of the property, without the other’s consent, a year after it was purchased. They subsequently fell out and the brother sought to force a sale.

After the brother launched proceedings, a judge commented on the man’s naivety. He was not good with details and had relied on his brother to explain to him the meaning and effect of the deed. However, his brother had not breached the duty of candour that he owed to him and had not brought undue influence to bear.

The brother was entitled to expect that he would take independent advice before signing such a document. Had the mutual power to force a sale not been included, the brother would have been obliged to allow the man to live in the flat indefinitely without paying rent and would not have been entitled to share in any increase in its capital value. In the circumstances, the effect of the deed was fair and reasonable.

The judge gave the man and his family one month to move out before the flat would be put on the market.

Investment advice is best obtained from authorised professionals and it is unwise to rely on friends’ recommendations, no matter how trustworthy they may appear. In one case that proved the point, a currency trader who turned to fraud and lost £500,000 of private investors’ money received a six-year prison sentence.

The man had set up a legitimate business through which he traded on international currency exchanges on his own account. However, a series of reckless deals led to financial problems and he began to invest money on behalf of 28 individuals, some of whom were his close friends.

He only invested about £220,000 of £600,000 that he received, using most of the money to fund a luxury lifestyle, including first class flights and the purchase of a beach villa in Thailand. All but about £100,000 of the sums invested was lost and his victims, some of whom suffered great hardship, were left harbouring intense feelings of betrayal as well as their financial losses.

The currency trader had never been authorised by the then Financial Services Authority to trade on behalf of others and was ultimately jailed after he pleaded guilty to fraud and communicating an invitation or inducement to engage in investment activity. The facts of the case emerged as the Court of Appeal rejected his appeal against the length of his sentence, finding that it was neither wrong in principle nor manifestly excessive.

Because the trader was not an authorised financial intermediary, there is no protection whatsoever for his investors, who must seek redress (if there are assets against which to claim) through the court process.

With the recent furore over the Government’s proposed increase in the cost of obtaining probate on larger estates, currently on ice owing to lack of parliamentary time in the run up to the General Election, it is nice to see that the direction of change in costs charged by the state is not inexorably upward.

On 1 April, the cost of registering a Lasting Power of Attorney (LPA) reduced from £110 to £82, after the Court of Protection realised that the number of LPAs being registered meant that its income was exceeding the cost of running the service.

The fee for resubmitting an LPA for registration has also fallen – from £55 to £41.

LPAs are an extremely useful way of making sure that your financial affairs and any healthcare wishes are dealt with by those you trust in the event that you become unable to deal with them yourself.

Owning a long leasehold, particularly one in a block of flats or which is part of a larger development, can be very different from owning a freehold. Typically the obligations of tenants are more proscriptive, being based on an acknowledgement that parts of the property are common and that there will be other people nearby whose rights need to be respected.

A recent case shows how important these issues can be. It involved an elderly widow who ran a bed and breakfast business from her £2.8 million flat in breach of her lease, with the result that she was given six months to leave her home of 40 years.

The company that owned the freehold of the mansion block where the ‘bohemian’ woman lived sought forfeiture of her 125-year lease on the basis of a covenant contained within it that required that her flat must be used solely as a private residence and not for any purpose that might cause nuisance, annoyance or disturbance to other leaseholders.

Despite her denials, a judge found that she had been renting out rooms in her flat on a short-term basis in order to supplement her meagre income. What she was doing could only be viewed as a business and other residents had complained of the noise from her constant stream of guests.

Attempts to persuade her to curtail her activities had failed and her neighbours had endured unreasonable levels of noise and disruption over very many years. The covenant having been breached, the judge gave her six months in which to arrange a sale of her flat. Failing that, her lease would be forfeited.

When accidents cause damage or injury and the responsible driver is uninsured, a claim can be made to the Motor Insurers’ Bureau (MIB), an organisation financed by motor insurers with the intention of compensating those who have been involved in accidents with uninsured drivers or those who cannot be traced.

The existence of the MIB is the result of governmental insistence that insurers should operate a safety net for those involved in accidents with uninsured or untraced drivers. However, it is controlled by the motor insurance industry and is not free from conflicts of interest.

Changes to its Untraced Drivers Agreement and Uninsured Drivers Agreement came into effect on 1 March 2017. These are intended to remove some of the impediments to claims under the old rules and to achieve a better degree of compliance with European law designed to ensure that victims of accidents involving untraced vehicles or uninsured drivers can be compensated.

One significant change is that the MIB will be required to pay for damage to an uninsured driver’s car where this is caused by another uninsured vehicle or a ‘hit and run’ driver.

An argument that assets which HM Revenue and Customs (HMRC) said belonged to a deceased man (and were thus subject to Inheritance Tax) were actually owned in whole or in part by his son was rejected by the First-tier Tribunal (FTT) recently.

After the son was subject to a tax assessment of more than £57,000 and penalties of more than £6,000 for failing to comply with a notice from HMRC, he took his case to the FTT. He argued that evidence concerning Indian cultural traditions would support his assertion that a bank account in his father’s name containing more than £100,000 was not his father’s property (HMRC had originally accepted, somewhat surprisingly, that the son was entitled to half of the money in the account) and that he also owned a half interest in a house, the title to which was his father’s alone. The son argued that he had inherited his late mother’s half share in the property, but her ownership was never formally evidenced and neither was his inheritance of that share.

The man’s accountant, who gave evidence on his behalf, was regarded by the FTT as an unreliable witness and it also considered that legal substance would have to have precedence over cultural tradition, particularly in the absence of any compelling evidence.

The appeal was unsurprisingly rejected.

In the Internet era, it is wholly acceptable to use Facebook or other social media to make contact with those who have to be notified of family proceedings. The High Court made that point after being forced to abandon an adoption hearing due to a failure to successfully track down a young boy’s natural mother.

The boy had been taken into local authority care following a breakdown in his living arrangements with his parents. He was placed with a foster parent who wished to adopt him. Adoption proceedings were launched, but were resisted by the boy’s father on the basis that he had transformed his lifestyle.

The boy’s mother, who lived abroad, was required to be notified of the proceedings so that she could play a full part in the hearing if she so wished. The council had made abortive efforts to contact her through a foreign embassy. At a late stage in the proceedings, however, the father’s partner claimed that she had very rapidly managed to establish contact with her via Facebook.

The Court found that there was no bar on social workers themselves carrying out such Internet research. It was deeply regrettable that the council had not found a means of informing the mother of the proceedings, of which she had been entirely unaware. That failure had resulted in a substantial waste of both private and public funds.

Notwithstanding the potential damage that further delay would cause to the child’s welfare, and the upset endured by the proposed adopter, the Court found that it was obliged to abandon the hearing. The case would have to start again from scratch, this time with the mother enjoying a full opportunity to put forward her views.

Disputes about the validity of wills frequently centre on allegations that the deceased lacked ‘mental capacity’ when they created a will.

In a recent case, the court had to consider whether a man who died less than two months after writing a will was mentally competent to do so, given that he was taking a cocktail of drugs and had shown delusional behaviour.

The man had shared his home with his second wife for many years and the will he created directed that his half share of the property should not be sold during her lifetime without her consent or unless she cohabited with someone else. His ex-wife’s responsibilities were limited to keeping the property insured and in good repair. In the event of her death or if her right to reside in the property ceased, the proceeds of his share were to be paid to his daughter, who was appointed executor under his will.

The relationship between husband and wife had deteriorated rapidly some months before his death, which his wife attributed to the effect of the drugs administered to him whilst he was in palliative care. The man was at times delusional and his behaviour could be very erratic: the couple’s relationship had effectively broken down prior to his death.

His widow claimed that the will was invalid as he lacked testamentary capacity at the time it was made. She argued that as there was no earlier will, the estate should be distributed according to the rules of intestacy.

In the High Court, the judge relied on the testimony of social workers and the solicitor who took the man’s instructions for his will and concluded that ‘the evidence suggests that even if by reason of a disorder of his mind he became unjustifiably antagonistic to her, nevertheless that did not poison his affections or prevent his sense of right or was otherwise a disorder of his mind that influenced [him] in the distribution of his estate’.

Accordingly, the validity of the will was upheld.

Disturbance can take many forms and noise is just one of them. Planners made that point in heeding the concerns of residents of a quiet cul-de-sac and scotching plans for a 30-flat supported living development on the edge of a seaside town.

The would-be developers wished to demolish a two-storey house in the cul-de-sac in order to provide an access route to the development site. However, outline planning consent was refused by the local authority and that decision was later confirmed by a central government planning inspector.

The latter found that, although noise endured by the owners of nearby properties would not be significantly increased, the disturbance to their lives would be unacceptable. The development would lead to a substantial increase in traffic passing through the cul-de-sac, interfering with residents’ peace and tranquillity.

In rejecting the developers’ challenge to that ruling, the High Court found that the inspector had made no error of law and that the reasons he gave for his decision were intelligible. The cul-de-sac was a quiet enclave of seven homes and the inspector was entitled to find that the increase in traffic levels and pedestrian movements arising from 30 new flats would cause a significant disturbance.

On the rare occasion that a professional adviser makes a mistake or behaves improperly, clients should be able to be confident of being compensated in full. A recent case shows how a client’s potential loss at the hands of identity fraudsters was met by insurers.

The case concerned a highly experienced solicitor with an unblemished professional history who worked for a law firm as a consultant. In the context of what she believed was a legitimate application for a short-term business loan, she had been duped by identity fraudsters. A lender suffered a substantial loss and the firm subsequently settled its claim for £370,000. That sum was paid by the firm’s insurers, who sought to recover their loss from the solicitor. Under the terms of the firm’s professional indemnity policy, however, her liability depended on proof that she had acted dishonestly in the fraud.

The High Court noted that, after becoming aware of the fraud and that she was likely to be subject to criticism, the solicitor, who was experiencing problems in her private life at the time, foolishly deleted various emails and forged signatures of the purported borrowers on a letter of authority. After the truth emerged, she had been cautioned by the police and various findings of misconduct were made against her by the Solicitors Disciplinary Tribunal.

There was no doubt that she had failed to act with integrity and that her actions after the fraud was uncovered were improper. She had exhibited a serious lack of professional care in dealing with the transaction, but the firm had not alleged that she was a knowing participant in the fraud itself. In the circumstances, the Court found that, despite her various breaches of the Money Laundering Regulations 2007, the insurers had failed to establish that their loss arose from her dishonesty.

We have often written about the dangers of taking advice from unqualified and/or unregulated advisers. A recent change in the regulations surrounding financial advice will cause some concern for those with friends or relatives who may be influenced by non-tailored advice to take actions that could later prove to have been ill-considered.

The changes relate to what may be considered to be ‘financial advice’. The UK definition is currently very broad in scope and is not in alignment with the EU Markets in Financial Instruments Directive. However, that will change in January 2018 as a result of regulations amending Article 53 of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 so that only advice which is personal to the recipient will constitute ‘financial advice’. This will mean that most regulated firms will be exempt from the need to hold a permission to advise on investments unless the firm is providing a personal recommendation.

The result may well be both an upsurge in generic (but possibly persuasive) financial advice and a widening of the range of advisory services offered by organisations which are not regulated by the Financial Conduct Authority.

A person who voluntarily prioritises their marriage over their working life may not be entitled to compensation for the earnings foregone if their relationship ends in divorce. The Court of Appeal made that point in ruling on the case of a former headteacher who abandoned her career when she married a doctor who was 16 years older than she.

The woman was in her 40s when she married the semi-retired doctor. She gave up her job as head of a primary school and subsequently only worked as a supply teacher. She sold her house, using the proceeds to purchase a half share of her spouse’s home, which was worth about £960,000. The couple had enjoyed an affluent lifestyle during their eight-year marriage. Following divorce proceedings, a judge ordered the husband to pay his former wife a £140,000 lump sum in order to achieve a clean break.

In challenging that decision, she argued that she had given up full-time employment after her husband assured her that he would look after her financially. As a result, she had lost substantial earnings and her right to a generous final salary pension. She had been left with insufficient resources to purchase a home comparable to the one that she had shared with her husband during the marriage.

In rejecting her appeal, however, the Court noted that she had not been put under any pressure to give up her career and that her husband had not gained financially from her decision. The judge was right to confine his attention to ensuring that her future needs would be met. The standard of living that she had enjoyed during the marriage was not determinative and the judge was entitled to find that she required a housing fund of £450,000, rather than the £700,000 that she had claimed.

Where there is money, there is opportunity for wrongdoing and a steady stream of cases show that vigilance is needed to prevent the assets of the deceased or elderly being misappropriated. In one case, three cleaners of a deceased South Wales man claimed to have found a copy of a will he was purported to have made which divided his £320,000 estate between them, allegedly in appreciation for their assistance in housekeeping in his final years.

Probate was granted and the three women were beginning to help themselves to the estate before suspicions led the police to investigate. Forensic evidence found the will to be a forgery and the cleaners, who all had previous convictions, were jailed for conspiracy to commit fraud by false representation.

In another case, an elderly man who gave a Lifetime Power of Attorney (LPA) to his carer ended up with his care home charges unpaid after she sold his house and helped herself to assets worth £240,000. She was also jailed for fraud.

These cases illustrate the wisdom of always involving a solicitor in the preparation of LPAs or wills and taking steps to ensure that finances are not controlled by a single person. We can assist by overseeing the operation of LPAs if required or by acting as executors or co-executors of your will.

As a recent case shows, whilst there is legislation which, in certain circumstances, allows leaseholders to obtain the right to manage the buildings they occupy, the process is replete with traps and it makes sense to proceed in such cases only with the advice of an expert property lawyer.

The case concerned a ‘right to manage’ company that had been formed with a view to taking over the management of a block of 40 flats. Pursuant to procedures laid down by the Commonhold and Leasehold Reform Act 2002, the company had served notices on qualifying tenants inviting them to participate in the process.

The freeholder of the building wished to resist the transfer of the management to the tenants’ company and pointed to procedural flaws in the notices. Tenants had not been offered facilities to inspect the company’s articles of association on a Saturday or a Sunday and no notice had been served on an intermediate landlord of one of the flats which was subtenanted. Those arguments prevailed before the Upper Tribunal and the company’s bid to take over management of the property was thwarted.

In upholding the company’s appeal against that ruling, however, the Court of Appeal found that the notices were not invalidated by shortcomings that were purely procedural. The Court noted the melancholy fact that whenever Parliament lays down a detailed procedure for exercising a statutory right, people commonly get the procedure wrong.

This was the third time that the company had sought to take over the management of the block and the Court urged the Government to simplify the procedures in order to reduce the potential for challenge by obstructive landlords. Otherwise, objections based on technical points of no significant consequence would continue to bedevil the acquisition of the right to manage.

When a taxpayer named Mr Coomber sent his cheque by post to HM Revenue and Customs (HMRC) to settle his tax demand, he thought that would be the end of the matter.

He paid the tax bill on 2 February 2016 and, as late as 1 March 2016, HMRC mistakenly told his agent that there was a ‘nil’ balance on his tax account.

However, on viewing his bank statements in early March, he saw that the cheque had been wrongly dishonoured by the bank on 4 February 2016. He rapidly made another payment to clear his tax account.

The result was a penalty for late payment from HMRC after the payment was credited to his tax account on 17 March 2016.

The payment due was in excess of £18,000 and the penalty was 5 per cent of the tax due after the due date, some £942.

He claimed that the penalty should be discharged because he had a ‘reasonable excuse’ for the late payment: he genuinely believed the payment had been made.

HMRC disagreed. So did the First-tier Tribunal, which ruled that ‘it was Mr Coomber’s responsibility, as the taxpayer, to make sure that his tax was paid on time. Mr Coomber chose to pay his tax liability by cheque rather than by some other means…which would have given him the immediate knowledge and assurance that the payment had been safely received. Mr Coomber also chose to pay his tax at a very late stage…in doing so, taking a risk that, if anything went wrong with the cheque, or (for example) if it went astray in the post, payment would not be made in time…’, concluding that a reasonable taxpayer would have ‘phoned the bank to find out whether the big tax cheque had cleared’.

For anyone familiar with the difficulties of dealing with many banks’ telephone banking systems, or dealing with HMRC via the Government Gateway, this conclusion may be something of a surprise. However, unless the ruling is successfully appealed, the penalty will stand.

In general, there is a presumption that on divorce the assets will be split more or less equally, but that is based on case law interpretation of the Matrimonial Causes Act 1973, not statute. Currently, a Bill in the House of Lords (the Divorce (Financial Provision) Bill) proposes to create a statutory presumption of equality, thus superseding the judge-made law currently used.

A recent case may give added impetus to the argument for a more certain basis for the division of family assets on divorce. In it, a wife (a past alcoholic) was awarded just over a third of the couple’s joint assets of nearly £37 million because of her husband’s ‘unmatched contribution’ to the accumulation of their wealth, based on his personal efforts and having provided the seed-corn capital on which their successful company had been founded.

The husband had argued that his wife’s settlement should be based on her needs, not on an asset share, and that his contribution to the success of the company had been ‘utterly exceptional’. The court would not accept that argument, however. His ex-wife acknowledged that there should be some disparity and her suggestion that she should receive 37.5 per cent of their joint assets was accepted.

Will disputes can be extremely bitter and the kind of skulduggery depicted in fiction sadly sometimes reflects reality. In one case, the High Court found that a well-respected accountant had forged his mother’s will in order to gain control of business interests worth $50 million.

The woman signed a will in 1986 by which she left her entire estate to one of her four sons. However, some years after their mother’s death, one of his younger brothers produced another purported will, said to have been executed in 2005. If valid, that will conferred on him a stake in an asset that was described as the ‘jewel in the crown’ of a family business empire valued at around $200 million.

However, detailed forensic analysis of the 2005 will revealed that it was a forgery. For reasons of business convenience, the woman had been in the habit of signing blank documents in bulk so that their content could be filled in after the event. The impression of another signature of the deceased on the purported will, in close proximity to her actual signature, was consistent with her having pre-signed a number of empty sheets, one on top of the other.

The Court concluded that, despite his professional and business achievements, the brother had taken advantage of his mother’s practice for his own benefit. He had brazenly lied and had a powerful motive for forging the will. In the circumstances, the Court found that the 1986 document had rightly been admitted to probate as the woman’s last true will.

The Government has acknowledged that the upcoming general election makes it unlikely that probate fees will increase significantly in May as planned, as there will not be time for Parliament to pass the legislation.

The planned changes to the fees payable would have benefited smaller estates, with the amount below which estates are exempt from fees rising from £5,000 to £50,000. However, the move has been criticised as a ‘stealth tax’ on larger estates.

It is not yet clear whether the Conservatives will press ahead with the proposal if they win the election.

The need for charities to exercise strict controls over the disbursement of significant sums was made clear in a recent report by the Charity Commissioners into a small charity.

The charity, which operated to promote active sports among the disabled, suffered a theft by a trustee who had subsequently died. More than £10,000 was recovered and the Charity Commission informed. The Commission’s investigation revealed that the charity’s annual returns and accounts had been filed late and that the details of the trustees as returned were out of date.

However, the chief issues relating to finance were that the charity’s finances were under the exclusive control of a single trustee and that although a professional fundraiser was used, there was no evidence of the legal agreement with the fundraiser, who was effectively under no control.

If you are involved with a charity as a trustee, you have significant responsibilities. The Charity Commission publishes a guide called ‘Internal financial controls for charities’ and another called ‘Managing charity assets and resources’, which should be read, understood and complied with by all charity trustees. These can be downloaded from the Charity Commission website.

In principle, losses to a charity which result from the negligence of trustees can leave the trustees personally liable. It is common for small charities to depend on very few people and to adopt a casual attitude to financial controls, but this is a risky strategy.

Boundary disputes are commonplace and, unless skilfully mediated, can often spiral out of control, ending up in legal action the cost of which far exceeds the value of the land under dispute.

One of the more important principles in such disputes is often a difficult one for the property owners to take on board, and that is that the subjective beliefs of the owners as to where the boundary lies is evidence which is not normally admissible, although their ongoing behaviour as regards its location can be in point. It is the conveyance of the property that determines the boundary, and in particular the presence of a plan provided for the definition of the property (as opposed to one which is merely for identification purposes).

This is important because the topography of a site may change over the years, but what matters is the state of the boundary when the conveyance occurred, unless the boundary has subsequently been changed by agreement of the property owners. In that case, the agreement will bind future purchasers of the properties concerned.

And so it was that when two academics ended up in court with their neighbours over the boundary between their properties, which had been in dispute for some years, the judge based his decision largely on an examination of the plans identifying the properties concerned used in a conveyance.

Once he had concluded that there was no passing of legal title from one side to the other as a result of adverse possession (‘squatters’ rights’), he was able to conclude that the boundaries had not changed since the relevant conveyance.

With HM Revenue and Customs (HMRC) pressing ahead with plans to make ‘customers’ deal with them only digitally, it is good to see that when a system issue with the EE network meant that some of the company’s customers were unable to access the HMRC website on 31 January (the last day on which a tax return may be filed without incurring a penalty), they have agreed to allow those affected to file an extension.

The glitch meant that a confirmatory text message, needed to log in, was not received by many customers.

Difficulties in using the Government Gateway are well known. Despite protests, however, the Government is also intent on pressing forward with the requirement that small companies, landlords and the self-employed will have to file tax returns quarterly from April 2018, which seems an odd decision for a Government that claims to be committed to reducing the administrative burdens it imposes on its citizens.

On the plus side, the intention is that the chore of the annual tax return will be done away with for almost everyone by 2020.

When the marriage of a wealthy couple broke up, the English court had the opportunity to consider the impact of two pre-nuptial agreements the couple had made before they wed.

The couple, both Swedes, married in 2000 and had had two children by the time they separated in 2015. They have lived in the UK since 2011, hence why their divorce was dealt with under English law. Their divorce was made final in 2016, at which time the Family Court concluded that their joint assets were worth in excess of £10 million.

However, they had entered into pre-nuptial agreements in Sweden and in the USA (where the husband worked) in 2000, under which the wife agreed to waive entitlement to any capital payment from the husband in the event that their marriage was dissolved.

She argued that the agreements were entered into by the husband’s misrepresentation and also that they were so unfair that the court should decline to enforce them.

However, evidence was given that before she signed the agreements, she was advised to take independent legal advice.

In a case that contained many complexities, the judge concluded that ‘the parties did consensually enter into one or more pre-nuptial agreements and that, at the time when they were entered into, the effect of the agreement or agreements was not vitiated by factors such as fraud, misrepresentation or undue pressure’.

The settlement ordered was largely one dealing with maintenance of the ex-wife and children, giving the wife £2 million from the proceeds of the sale of the matrimonial home in order to provide accommodation for the family until 12 months after the last of their children ceases full-time undergraduate education. In addition, the ex-wife was awarded annual maintenance of £95,000 per year.

The latest research from National Savings and Investments shows that a staggering 64 per cent of adults in the UK have not made a will, and that 38 million adults have made no arrangements for their retirement or provision for long-term care, although half of those who have not do claim to have given the matter thought.

The most common reason for failing to make a will is that people feel it is ‘too early’, with a fifth of the 45-64 age group still giving this as the reason why they have not done so.

Somewhat surprisingly, interest in planning for the future is greatest in the 25-34 age group, where 72 per cent have considered making financial provision for later life.

The Supreme Court has ruled on the long-running dispute between First Bus and a disabled passenger who sued the bus company after a driver declined to intervene when a passenger occupying the wheelchair space refused to move.

The disabled passenger, who is in a wheelchair, found the designated space on the bus occupied by a young mother and her sleeping baby. The mother refused to move on the ground that the baby’s buggy would not fold up.

The Court took a very practical view and specifically considered the range of responses which would be practical in the circumstances. In conditions such as these, the Court was of the view that a request to move, followed by a short stop to try to persuade the occupant to move if their response seemed unreasonable, was all that could reasonably be expected of the driver.

The law relating to what must be done to accommodate people with a disability is, in many instances, quite specific, although in this case the Court took the view that to push the transport provider’s responsibilities too far might lead to matters spiralling out of control.

The standard pre-contract enquiries made by a solicitor when a client is intending to purchase a property include querying whether there are any disputes which may affect the value of the property being purchased.

When a woman bought a flat in a block of flats for £240,000 from the developer in 2012, the replies to the relevant questions were anodyne. However, a number of issues were already extant relating to the inadequacy of a biomass boiler used for hot water and heating in the block, the excessive levels of service charges imposed on the flat owners and the refusal by the developer to establish an independent management company.

She sued the developer for misrepresentation and claimed damages based on the difference between the market value of the flat based on a full knowledge of the circumstances and what she had in fact paid.

The developer denied that there had been any misrepresentation.

The court found that as a matter of fact the boiler issues were ones about which the developer had made a misrepresentation and ruled that it should pay her £25,000 in compensation.

The developer appealed and pointed out that when the woman sold the flat and moved on, she made a profit of £35,000. By that time, the heating issue was being rectified under the guarantee, so, argued the developer, while she had disclosed the issue to her purchaser, it did not affect the selling price. She had therefore made no loss.

Lord Justice Floyd of the Court of Appeal commented in his judgment, "The contention that a wrongdoer should be able to take advantage of a rise in the market value of an apartment when he had induced the purchase by a misrepresentation is, at first sight, rather surprising."

Although in some cases the profit from a later event could be brought into account, this was not one of them. The existence of an insurance policy (an NHBC guarantee) relating to the boiler was the reason why the woman had not suffered a loss and there is an established principle that where a claimant has been able to use an insurance policy to reduce or extinguish her loss, this is not to be brought into account.

Accordingly, the developer’s appeal was dismissed.

The complexities of financial advice can be bamboozling, particularly for the elderly, but one High Court case – in which a 96-year-old woman won more than £220,000 in damages in respect of negligent advice – strikingly showed that expert legal support can assist in achieving a just settlement.

The woman, who was domiciled outside the UK, had inherited a portfolio of low-risk investments from her mother that by 2001 was valued at £567,700. With a view to achieving capital and income growth, and minimising Inheritance Tax liabilities, she obtained advice from a financial planning consultant who was a ‘tied agent’, representing a single life assurance company.

On his advice, she invested her portfolio in a number of the company’s financial products. They were unsuitable for a person not domiciled in the UK and performed poorly over a number of years. Any growth in her fund was eaten up by unnecessarily burdensome commissions and charges. Following a series of mergers, the company with which she originally invested changed ownership and she launched legal proceedings against the new owner.

In upholding her claim and ordering the company to pay her £223,000 in damages, the High Court found that the consultant had fallen well short of competently discharging the duty that he owed her. Every word that he wrote or uttered showed that he had misunderstood the crucial importance of her domicile, did not know the relevant rules and was completely out of his depth. His shortcomings were compounded by the failure of the company he represented to ensure that she had received independent tax advice.

One of the most important roles played by judges is to protect individuals against unlawful treatment by the state. In one unique example, the High Court came to the aid of a couple who found themselves caught in a legal nightmare after their twins were born following fertility treatment.

Under the auspices of a reputable fertility clinic, the couple had arranged conception of the twins using donated sperm. However, officials twice refused to register the man as the children’s father because forms that the couple had completed, which were said to be required in order to prove that they had consented to the fertility treatment, were missing. The couple felt that they had no choice but to register the twins’ births with the boxes identifying their father left blank.

The Court had no difficulty in finding that the couple had freely consented to the treatment and in recognising them as the twins’ legal parents. However, a further problem arose because, if their birth certificates were merely amended, the role of the sperm donor would be obvious to all who looked at them. The couple, who had not intended to tell their children that they were conceived using donated sperm, understandably objected to that course.

Ruling on the case, the Court noted that the state, by its actions, had denied the couple the right to decide for themselves, within the privacy of the family, what in their view was in the best interests of their children. In refusing to name the father on the birth certificates, the registrars had followed ‘to the letter’ an official handbook. The Court nevertheless found that they had erred in law and that the relevant parts of the handbook required revision.

In upholding the couple’s judicial review challenge, the Court overturned the birth certificates and directed that entirely fresh ones be prepared. The new documents would give no indication to a future reader that a sperm donor played any part in the twins’ conception.

A recent case shows the importance of involving a solicitor in the preparation of a will, especially where it is considered that an attempt to invalidate it on the grounds of lack of mental capacity may be made.

It involved an elderly man who changed his will when he was 81 years old. His earlier will, made when he was 76, gave his business interests to his son, who also stood to inherit a quarter of his estate, the balance of his estate being left to other relatives.

However, fearful that his son would fritter away his share of the inheritance, the man changed his will so that his son stood to inherit his business only.

When he died, his son challenged the later will.

The critical evidence in the case was that given by the man’s solicitor, who had no doubt that he had full mental capacity (‘was of sound mind’) at the time the second will was made and so was capable of making a will that was both understood by him and reflected his wishes. The court ruled that the new will should stand.

Solicitors are trained to ensure that they satisfy themselves to the maximum extent possible that anyone who instructs them to draft a will understands the effect of the will and is acting under their own volition, not under the undue influence of anyone else.

A recent case in which a litigant who waited more than a year to file its final defence against a claim had its late submissions rejected by the court is a reminder that tardiness in legal proceedings can have serious consequences.

After receiving the defence documents, the claimant requested further information in December 2015. On 6 December 2016, with the trial date of 16 January 2017 looming, the defendant in the case applied to amend its responses on two matters without any good explanation for the delay.

Although the claimant accepted one of the proposed changes, the High Court ruled that even if the points raised had both been arguable, the amendments had to be rejected because they would have given the claimant insufficient time to respond and to reconsider its case.

The judge commented, "If I allowed these amendments, they would not only comprise an unwelcome and unnecessary distraction to the claimant as it prepares for a trial that is a month away, but it would probably also give rise to the need for further evidence, perhaps including expert evidence. That would fatally jeopardise the trial date."

New rules which came into effect on 1 January 2017 will see professionals who deliberately aid clients to evade (not avoid, which is legal) tax saddled with penalties of the higher of £3,000 or 100 per cent of the tax they helped their client evade.

‘Tax-geared’ deterrents for professional firms have been in place for many years in the USA. The new UK tax evasion penalties will apply if the adviser provides advice, planning or other professional services that facilitate tax evasion, including transferring funds offshore for a tax-evading client. They can also apply if a company facilitates tax evasion for an employee or contractor.

In addition, the professional adviser will be able to be ‘named and shamed’ by HM Revenue and Customs (HMRC) and the benefits they derived from their work can be considered to be the proceeds of crime and subject to confiscation.

In addition, those who have evaded tax in the past have until September 2018 to correct their past returns or face new penalties.

Over the last six years, HMRC have garnered nearly £50 million a year from offshore tax evaders.

Disputes between neighbours can be agonising, both emotionally and financially, but taking advice at an early stage can swiftly draw the sting. In one case where matters were allowed to get out of hand, a pensioner was left at risk of losing his home after being ordered to pay in the region of £140,000 in damages and legal costs.

The man had got on well with his neighbours until he carried out excavation works on his land and erected a fence. He did so without consulting his neighbours. There was no dispute that the fence was on the man’s land, but his neighbours argued that its erection had undermined the foundations of their garage.

A judge found in the neighbours’ favour and ordered the man to pay damages and costs. He was also required to allow his neighbours’ workmen onto his land for the purpose of erecting a retaining wall and to cover the £30,000 cost of those works.

The facts of the case emerged as the Court of Appeal refused to grant the man permission to challenge the judge’s ruling.

Probate fees, which rose sharply only three years ago, are about to rise again.

Under the present scheme an application for probate by an individual costs £215 and by a solicitor £155, but from May 2017 a new tariff is being introduced which will see the probate fee for estates of more than £2 million rise to £20,000 or more.

The new scheme has been decided upon by the Government after a 2016 consultation produced a majority of more than 90 per cent against the proposal to link the cost of probate to the value of the estate.

It should be noted that the value on which the charges will be levied is the gross value of the estate, not the value for Inheritance Tax (IHT) purposes, so assets which benefit from IHT reliefs (such as farmland or business assets) will be fully valued when calculating the amount of probate fee to be charged.

On the plus side, those with smaller estates will benefit from the estate value below which no probate fee is charged rising from £5,000 to £50,000. The proposals are expected to remove 30,000 estates annually from the charge for probate, but to raise an additional £250 million overall.

Under the new proposals, the fees will be as follows:

  • £300 for estates valued at £50,001 to £300,000;
  • £1,000 for estates valued at £300,001 to £500,000;
  • £4,000 for estates valued at £500,001 to £1 million;
  • £8,000 for estates valued at £1,000,001 to 1.6 million;
  • £20,000 for estates valued at £1,600,001 to £2 million.
  • Estate more than £2 million will incur a fee of 0.4 per cent of the value of the estate.      

If your estate is large, not only will the IHT charge be likely to be significant, but the probate fee may be also.

A surprising Court of Appeal decision that a daughter was a ‘dependant’ of her estranged mother and thus entitled to benefit from her estate has now been overturned by the Supreme Court.

Heather Ilott had been deliberately excluded from the will of her mother, Melita Jackson. Mother and daughter had become estranged after Ms Ilott left home at the age of 17 to live with a man of whom Mrs Jackson disapproved. Mrs Jackson’s will left her entire estate to three animal charities with which she had no particular connection.

Ms Ilott brought a claim under the Inheritance (Provision for Family and Dependants) Act 1975 after her mother’s death. The Act allows a person who has been dependent on someone who has died without including them in their will to make a claim against the estate for ‘reasonable provision’ to be made for them in order to avoid their becoming destitute. Ms Ilott was awarded £50,000 at her first court appearance, a decision that was upheld by the High Court in 2014.

In 2015, however, the Court of Appeal concurred with Ms Ilott’s claim that the Act applied to her and awarded her a total of £163,000, even though she had had no contact with her mother, let alone a relationship involving financial dependency, for years. Part of the reasoning behind the decision was that the original award would result in Ms Ilott losing means-tested benefits on which she relied, so would not leave her significantly better off.

The charities appealed to the Supreme Court, which has now reinstated the original award of £50,000.

The problem of making family financial settlements or court rulings in divorce ‘stick’ is well known. Following an extensive consultation process, the Law Commission has made proposals designed to improve the situation for those affected when payments are not being made as they should.

As well as simplifications in the law and procedures, the Commission is proposing:

  • increasing the obligations on the debtor to make an honest and early disclosure of their financial circumstances (including allowing the court to require information from third parties) and giving the court wide powers to ensure enforcement. This will include allowing enforcement against assets which currently cannot be brought into the equation; and
  • enabling the courts to ‘apply pressure to debtors who have the means to pay but are refusing’. These powers will include the temporary revocation of the right to drive or leave the country.

The report was published on 15 December 2016 and the Government’s response is expected shortly.

When an elderly man died owning both a house and a half share in an attached property with his sister, whose financial affairs were already being administered by a cousin under a power of attorney, the scene was set for the cousin to seize ownership of the property.

The cousin took over dealing with the deceased man’s estate. She claimed to have found a will, whilst cleaning out his house prior to putting it up for sale, which left his own house and his half share in the adjoining property to his sister. The will turned out to be a forgery, however. The cousin and her husband then also forged a letter purporting to be from the man’s sister, instructing her as attorney to transfer both properties into the ownership of her daughter.

Using her power of attorney, the cousin then had both properties registered in her daughter’s name. She also appropriated £23,000 of the sister’s assets to pay for the two properties to be converted into a single larger dwelling.

As the cousin might well have inherited the properties anyway, it is difficult to understand her actions. The fraud only came to light when a property dispute arose regarding the boundary of one of the properties.

Both the attorney and her husband pleaded guilty to offences for which they received three concurrent jail terms of six months. The property will almost certainly be ordered to be restored to the deceased’s sister.

The answer to the vital question of whether a taxpayer is ‘ordinarily resident’ in the UK depends on many factors. In one such case, a billionaire businessman received an £84 million tax bill after HM Revenue and Customs (HMRC) refused to accept that he had made his home in Monaco.

HMRC claimed that the tax was due after the man’s sale of a tranche of shares in his company yielded £200 million. He argued that, at the time of the sale, he and his partner were living in a hotel suite in the principality, later moving to a yacht in the harbour and subsequently to a rented apartment.

In arguing that he was not subject to UK tax at the time of the share sale, he said that his move to Monaco represented a distinct break in his pattern of life and that he had a settled intention of remaining there.

In countering those arguments, however, HMRC pointed out that he had remained Executive Chairman of the English-registered company he founded and had retained his family home in England. He had flown to the UK more than 40 times during the relevant tax year, primarily in order to visit the company’s head office. The facts of the case emerged as the First-tier Tribunal gave directions in respect of the pending hearing of the businessman’s appeal against the tax bill.

This dispute will clearly be appealed no matter what the decision, as such a large amount of tax is at stake. It does underline the point that HMRC will seek to attack tax avoidance measures involving large sums of tax whenever the possibility exists, and emphasises the need to take great care when making any tax avoidance arrangements.

In his Autumn Statement, the Chancellor announced that the Government intends to change tax laws for non-domiciles to make residence the key issue in determining liability for UK tax.

Social housing tenants are not normally permitted to sublet their properties. Where it is discovered that they have, an Unlawful Profits Order (UPO) can be made to recover any profit made by the tenant. This is normally based on the difference between the rent charged to the subtenant and the rent the tenant pays to the landlord.

Where a UPO is granted after an application by the landlord, that is not the end of the matter for the tenant, as a recent case shows. It dealt with a tenant who unlawfully sublet his London flat. He was ordered to pay £14,700 in respect of the unlawful profit, plus the legal costs, as well as making good rent arrears of more than £5,000 after the local council brought proceedings on behalf of the housing authority.

However, the sting in the tail for the tenant was that the landlord was also granted a possession order over the property.

Failure to adhere to the terms of your lease can lead to a number of problems, as this case illustrates. In another case, a tenant who sublet his flat using an online short-term letting service was also put through a court case when the landlord took successful action to prevent the practice.

Bankruptcy gives debtors the chance to wipe the slate clean and make a fresh start – but such opportunities are only open to those who cooperate with creditors: the law is tireless in its pursuit of those who do not. That point was made by one High Court case involving a debtor who was threatened with imprisonment for repeatedly failing to disclose details of his finances.

Sixteen years after he had been made bankrupt, the man remained undischarged due to his failure to give appropriate assistance to his trustee in bankruptcy, whose task it was to protect his creditors’ interests. The trustee presented evidence that the bankrupt man had continued to enjoy an affluent lifestyle, including having foreign holidays, golf trips and restaurant meals, whilst his creditors remained unpaid.

He had a long history of failing to comply in full with a number of court orders that had required him to disclose details of his assets, income and outgoings to the trustee. In the circumstances, the Court found him in contempt and warned him of penal consequences if his disobedience continued. Sentencing was adjourned but the Court advised him in no uncertain terms that he could not expect mercy if he failed to use the interim period to regularise his position.

Disobeying court orders is ultimately punishable by imprisonment – but only as a last resort. In the context of a family case, the Court of Appeal has ruled that a woman in her 70s, who honestly believed that she was doing her best for a vulnerable man with dementia, should not have spent seven weeks behind bars.

The woman held a power of attorney in respect of the man, who was in his 80s and lacked capacity to make decisions for himself. She had moved him away from Devon, where he had lived for 50 years and where he had a wide circle of friends. Shortly after a social worker recommended his return to the county, she removed him to the country of his birth, Portugal, where he had since resided in a care home.

She had repeatedly refused to comply with orders requiring her to sign documents authorising his discharge from the Portuguese care home and to arrange his return to Devon. After she failed to comply with the terms of a suspended committal order, a warrant for her arrest was issued and she was held in custody for nearly seven weeks until the Court directed her release. She was only freed after a barrister took up her case, free of charge, and put forward arguments on her behalf.

Giving its reasons for releasing her, and praising the barrister who came to her aid, the Court expressed concern that an elderly lady should have found herself in prison despite being of impeccable character. There was no doubt that she had acted on the basis of her deeply held and sincere beliefs as to where the man’s best interests lay. In finding that her incarceration was premature and that she had been failed by the system, the Court also granted her permission to appeal against a welfare determination that the man should be returned to Devon.

Promises of generous returns on backing novel products can be awfully tempting for investors, but such investments should only be undertaken with the benefit of professional advice. In one case that underlined the point, the creator of a weight-loss drink defrauded investors and friends out of £580,000 in a futile attempt to keep his business afloat.

The man had held a series of high-level management roles in the past and gave all the appearance of honesty. He had himself invested heavily in his drinks business but resorted to deceit when failure was staring him in the face. Amongst extravagant and false claims that he made to investors were that the Prince of Wales Trust intended to invest in his product and that Sainsbury’s had agreed to stock it.

As his business descended into dire straits, he managed to extract £400,000 from professional lenders and also defrauded his friends, one of whom put £100,000 into the venture, the only capital that she had. It transpired that he had kept significant amounts of the money for his own purposes. The investors lost everything.

He ultimately admitted eight counts of fraud and was jailed for six years and three months. In challenging that sentence before the Court of Appeal, his lawyers said that he had been desperate and that the business had not been fraudulent from the outset. The convictions were a considerable fall from grace for a man who had previously led a blameless life. The Court, however, was unpersuaded that the sentence was manifestly excessive and dismissed the appeal.

Trusts are relatively common and the death of a trustee is by no means rare. A trust deed normally contains a clause stipulating how new trustees are to be appointed in the event of the death, incapacity or inability to serve of a trustee, and normally it is the settlor of the trust who retains the power to appoint trustees.

The Trustee Act 1925 (Section 36) provides that the right to appoint new trustees will rest with the persons ‘nominated for the purposes of appointing new trustees’ in the trust deed or, if there is no such person capable, the ‘surviving or continuing trustees, or the personal representatives of the last surviving or continuing trustee’.

So when a trustee of a family trust died, the settlor having already died without making provision for the appointment of new trustees after his death, all seemed straightforward. However, three of the four trustees and the adult beneficiaries of the trust proposed to amend the trust deed to allow the principal beneficiary of the trust to appoint new trustees with the written agreement of the current trustees. The fourth trustee did not agree, advancing several reasons why allowing the trustees to choose any new trustees but giving the principal beneficiary a veto would be a preferable approach.

The judge hearing the case considered that there was little to choose between the two methods and, since the majority of the trustees and all the beneficiaries favoured one method, that arrangement was to be preferred.

Neighbours engaged in boundary disputes would generally be wise to submit their differences to an independent expert for resolution, rather than fighting it out in court. However, as one High Court case underlined, it is important to remember that the expert’s decision is final and, unless appealed, binding, warts and all.

The case concerned a narrow strip of land between two suburban homes. A couple that owned one of them argued that the boundary line was marked by a timber post that had stood at the front of the properties. They argued that their neighbour had, after removing the post and a hedge, erected a fence on their side of the line.

When agreement could not be reached, the dispute was submitted to an independent surveyor, who upheld the boundary line contended for by the couple. The neighbour subsequently came across fresh evidence in the form of a previously undiscovered plan. However, with minor adjustments, the expert stuck to his earlier views.

The neighbour’s challenge to that outcome was rejected by a judge on the basis that the terms of the expert’s appointment made clear the intention of all parties that his decision would be final and binding, without recourse to the courts. In dismissing the neighbour’s appeal against that ruling, the Court noted that he was, in reality, seeking to challenge the merits of the expert’s decision. This was decisive and could not be challenged merely on the basis that it was mistaken.

Boundary disputes can not only sour relations between neighbours but they also often lead to positions becoming entrenched, and the final result of that is often that the ownership of the land in question is decided at very heavy cost to the loser.

Can individual voluntary arrangements (IVAs) be valid if debtors who enter into them lack the mental capacity to make rational decisions? In an important test case that has clarified the law, the High Court answered that question in the affirmative.

The case concerned a woman who, with her husband and others, was said to owe £224,000 in unpaid tax. She entered into an IVA but, after she failed to keep to its terms, a bankruptcy order was obtained against her by HM Revenue and Customs. Some years before she signed the IVA, she suffered a brain haemorrhage that was alleged to have seriously affected her decision-making ability.

Her challenge to the validity of the IVA was rejected by a judge, who found that there was insufficient medical evidence to show that she lacked capacity at the relevant time. In rejecting her challenge to that ruling, the High Court declined to consider fresh evidence and found that the judge’s decision could not be faulted.

Turning to the issue of the broader application of the IVA, the Court found that the IVA was binding on her even if she lacked the mental capacity to understand its key features and effects. It noted that IVAs are closely analogous to contracts and give rise to rights that have the characteristics of contractual rights. It is established law that contracts entered into by persons lacking mental capacity are valid and binding unless the other contracting parties are aware of their incapacity.

When a man inherited a property, he and his wife rented it out and later put it on the market for sale. In May 2010, they exchanged contracts for sale. They moved into the property at the end of June that year and lived in it for nearly a month, moving out again on 22 July in advance of the completion of the sale on 23 July.

Their accountant advised them that they could claim principal private residence (PPR) relief for Capital Gains Tax (CGT) for the last three years of ownership because they had lived in it as their principal residence before sale.

However, the accountant was wrong. Leaving aside the question of the legitimacy of the claim for PPR relief based on such a short period of actual occupancy while the sale was in progress, the effective date of disposal for CGT is the date of exchange of contracts on a property, not the date of completion.

When HM Revenue and Customs discovered the error, they raised an assessment for CGT and imposed a penalty on the couple for carelessness in completing their tax return. The penalty and interest together exceeded £23,000.

The couple accepted that the tax advice was incorrect and that the assessed CGT was due. However, they disputed the penalty because they had relied on professional advice.

The First-tier Tribunal (FTT) accepted their argument. It ruled that the couple had taken reasonable care to avoid inaccuracy in their returns by taking professional advice.

Financial problems are frequently connected with marital problems, and the interplay between family law and insolvency law can produce legal complications.

In a recent instance, the court had to decide what to do about a claim from the receiver in bankruptcy of a man who had died.

The bankrupt man and his wife divorced in 2008 after nine years of marriage. The divorce settlement provided that the man should repay to his former wife £1.4 million that he had borrowed from her under an informal agreement and pay her £24,000 a year in maintenance. Between the consent order to that effect being made and its approval by the court, the man was made bankrupt, a fact of which the presiding judge was not aware.

In the bankruptcy proceedings, the man failed to include his wife in his list of creditors and the trustee in bankruptcy applied to the court for the consent order to be ruled to be void because of that failure. In addition, it was claimed that another transaction between the man and his wife was a transaction at an undervalue and also voidable. However, things by this time had become more complicated by virtue of the man’s death, a factor that was to prove crucial.

Whilst rejecting the latter claim, the court accepted that the financial arrangements under the consent order should be voided. The trustee in bankruptcy claimed that the man’s ex-wife should pay a lump sum to meet his debts.

However, the Matrimonial Causes Act 1973 specifies that certain rights can only be pursued by the spouse, and these ‘do not extend beyond joint lives’. On that ground, the trustee’s claim against the man’s ex-wife could not proceed, even if the original order was voided.

House buyers often regard any inspection of a property beyond that undertaken by the surveyor acting for their mortgage provider as unnecessary. A recent case shows why this is a risky approach to take.

Under British law, the purchaser of a property takes it ‘as it is’ once they have contracted to buy it. Therefore, as well as satisfying oneself of the condition of the property, it is also sensible to ensure that you are aware of the exact boundaries of the land and whether any rights have been granted over it to others.

The case involved the purchase of a house on the Isle of Wight, which had a patch of land to the rear that, unknown to the purchasers of the property, had been previously let on a 1,000-year lease to the owner of a neighbouring property. That lease had never been registered at the Land Registry as it was acquired before compulsory first registration on sale applied to the Isle of Wight.

When the almost inevitable dispute over ownership of the patch of land ensued, the leaseholders attempted to register their interest in the land at the Land Registry and this application was opposed by the purchasers of the property.

The land in question was fenced off, but the fence was obscured behind a large fuchsia bush. Although the purchasers had visited the property on more than one occasion, they had not taken care to examine the boundaries. If they had, they could have raised the question of why part of the land was fenced off and resolved the situation (or not) prior to purchase.

The First-tier Tribunal ruled that a reasonably diligent purchaser would have raised the question and that, accordingly, the application by the leaseholders to register the interest in the land should proceed.

Arguments over the division of estates are unfortunately common where the value of the assets they contain is substantial, especially if family relationships are fractious. In such circumstances, the distribution of an estate can be delayed by legal wrangling and relationships can sour further. However, a professionally drafted will is the best way there is to ensure that your assets pass to whomsoever you wish to receive them and that challenges by aggrieved people who think they have been unfairly left out of the reckoning are unsuccessful.

In addition, it is always sensible to make sure that any agreements made between family members (e.g. loans) are properly documented, so that misunderstandings cannot lead to disputes.

A recent case shows the sorts of issues that can arise. It involved a farming family, an industry in which similar disagreements are legion. Unusually, the dispute arose before the death of the farm owner. The High Court rejected claims that he had given a £2.5 million cottage to his eldest son and daughter-in-law or that he had promised to leave it to them in his will.

The son argued that the cottage was his just reward for having worked hard and for low pay in the family farming and property development business for 20 years. He and his wife had lived in the property throughout that time, bringing up their children there, and claimed to have spent about £700,000 on improving it.

In rejecting the couple’s claim, however, the Court found no evidence that the farmer had given the cottage to them when they became engaged to be married. He had also given them no binding assurance that they would inherit the property. The son had been paid for his work in the family business, from which he stood to benefit in the long term, and had no moral or legal entitlement to the cottage.

The son had knowingly taken a risk when he invested in improving a property that did not belong to him and had never had more than an unenforceable expectation that he would inherit the property on his father’s death. The farmer had not acted unconscionably and the Court noted that the possibility remained open that he would in due course choose to leave the cottage to his son and daughter-in-law.

Press releases circulated by public authorities enjoy a high level of credence and are widely published across the media. However, their accuracy is not guaranteed and, in one case, a man who was wrongly accused of causing the death of rare breed cattle in his care secured £9,000 in libel damages from a local authority.

After the council mounted a successful prosecution, the man was convicted of five counts of neglecting the welfare of his cattle. Amongst other things, he failed to take reasonable steps to ensure that they received adequate fresh water or a wholesome diet. However, it was never alleged in the context of the criminal proceedings that he had caused the death of any of the animals concerned.

The council circulated a strongly-worded press release to the media following the convictions, which received a great deal of local and national publicity. It stated in terms that the man’s neglect of his herd had led to the death of three cows. After he launched proceedings, the council conceded that that allegation was defamatory and made an offer of amends.

In assessing the level of the man’s damages, the High Court noted that he could not be viewed as wholly innocent and that the fact of the convictions had caused some damage to his good name in any event. However, given the wide republication of the defamatory words in the press release and the public revulsion he subsequently endured, his reputation had been seriously harmed.