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Atticus Periodical Issue 3
Citation preview
Issue 3The cost of divorceThe devil in the detailBuilding bridgesCrowd Funding: the more the merrierProtecting the health of your wealthBusiness rates – a two-way street?The secrets of smart IP
a lupton fawcett lee & priestley periodical
Untanglingthe myths
around TUPEMake sure your business is not
left with costly liabilities
Contents3. Strengthening our business and our offering Managing Director, Richard Marshall, explains our acquisition of long-established Leeds-based law firm, Lee & Priestley.
4. TUPE – untangling the myths We tackle the controversial TUPE regulations and dispel some of the myths.
6. News in brief The Patent Box tax explained and a look at the thorny subject of tax planning.
7. The cost of divorce How specialist legal advice can help protect your finances during a separation.
8. Business rates – a two-way street? Why the issue of business rates should be of interest to more than just Property Managers.
9. The devil in the detail Questioning your current agreement could see you enjoy a little tax relief.
10. Building bridges Protect your interests and avoid expensive, lengthy conflicts before they happen.
12. Crowd Funding: the more the merrier Could the Crowd Funding phenomenon work for you?
13. Protecting the health of your wealth Introducing our new bespoke wealth management company, Leodis Wealth.
14. The argument in favour of NEDs Appointing a non-executive director (NED) could be the best decision your business ever makes.
15. The secrets of smart IP Our top 10 tips for good IP practice as well as the pitfalls to avoid.
15. The smart choice of legal partner Colin Horsley, Property Consultant at the Austin Reed Group, shares his experiences of working with Lupton Fawcett Lee & Priestley.
Welcome to the third edition of atticus. Once more we have packed this issue with the latest industry insight and clear, impartial advice as we take a closer look at some of the biggest issues and opportunities facing your business today.
The main aim of atticus is to inform and entertain, but we also hope to give you an insight into Lupton Fawcett Lee & Priestley, and some of our clients and contacts, along the way. We don’t intend this to bea technical publication, but we will keep youup-to-date with any changes and trends in the law that we think are interesting or relevant. Finally, we fully expect to evolve and develop this journal over time to better reflect the kinds of articles that you would like to read, so please don’t hesitate to let us know what you think and to make any suggestions for future editions.
E-mail your thoughts to atticus@lf-lp.com
Kevin EmsleyChairman
Lupton Fawcett Lee & Priestley atticus is printed on paper that uses only recycled fibre and wood from sustainably-farmed sources as well as being carbon balanced.
Scan this code and it will direct you to the atticus web page, where you can download a PDF of the latest and previous editions or read them online.
Standard text rates and data charges may apply.© 2013.
Lupton Fawcett Lee & Priestley
Yorkshire House, East Parade, Leeds, LS1 5BD
Leeds: T: 0113 280 2000 F: 0113 245 6782
Lupton Fawcett Lee & Priestley
Velocity House, 3 Solly Street, Sheffield, S1 4DE
Sheffield: T: 0114 276 6607 F: 0114 276 6608
Lupton Fawcett Lee & Priestley is the trading name of Lupton Fawcett LLP, a limited liability
partnership, registered in England and Wales, with partnership number OC316270. The registered office
is at Yorkshire House, East Parade, Leeds, LS1 5BD. A list of Members’ names is available on our website
and open to inspection at our offices. Authorised and regulated by the Solicitors Regulation Authority.
Please note that this publication contains general information and does not constitute advice on any
specific matter. Whilst Lupton Fawcett Lee & Priestley endeavours to ensure that the content in this
publication is accurate and up-to-date, nothing within this publication should be construed or regarded
as legal advice.
www.lf-lp.com
a lupton fawcett lee & priestley periodical
In previous editions of atticus I have
outlined our strategy to become the region’s
mid-market law firm of choice, and our
plans to do this by developing an offering
equal to the sum of the parts found across
the mid-market, all underpinned by quality
and real value.
We have been extremely busy since the last
edition of atticus, culminating in our acquisition of
the practice of Lee & Priestley, a long-established
Leeds-based law firm with first class lawyers and
clients. Lee & Priestley has a proud history of serving
the Yorkshire corporate community and meeting the
needs of its wealth-creating commercial clients with
private wealth preservation services.
The partners at Lee & Priestley recognised
the almost insurmountable challenges facing smaller
mid-market firms in the current financial and
regulatory environment, and the need for a stronger
platform from which to meet these.
After lengthy discussions, the Lee & Priestley
team recognised that their strategic objectives were
very similar to our own and that joining forces would
strengthen and accelerate their ability to deliver what
the market requires. In turn, the Directors of Lupton
Fawcett saw that joining forces with Lee & Priestley
would bring greater strength and depth in a number
of areas, in particular Corporate Finance, services
to the Health Care sector, Family and Child Care,
Employment, Commercial Property and personal
legal services, such as Trusts, Wills and Estates. It will
also create opportunities to deliver areas of our own
offering, such as Intellectual Property and Regulatory
Law, to Lee & Priestley’s clients.
The position is further enhanced by Lupton
Fawcett being able to absorb Lee & Priestley’s
partners and staff into our existing, well-controlled
fixed-cost base, allowing us to continue delivering
value for money to our mutual clients in a market
where solicitors are increasingly struggling to do so.
The two firms joined forces on 1 October 2012
through the acquisition of Lee & Priestley’s staff and
partners by Lupton Fawcett LLP. Lupton Fawcett LLP
now trades as Lupton Fawcett Lee & Priestley with
the intention of consolidating the brand under the
Lupton Fawcett banner once all of the stakeholders,
including clients, staff, our respective contacts and
the wider marketplace have become familiar and
comfortable with the move.
The importance of absorbing all that our
new colleagues have to offer, including how we
can improve what and how we do what we do, is
reflected in the appointment of James Richardson,
Lee & Priestley’s former Managing Partner, to our
Management Board and Strategy Board. James will
ensure there are clear channels of communication
throughout the organisation for us all to learn
from each other and provide better services for
better value.
Whilst joining forces with Lee & Priestley
enhances the offering across the firm, and both of our
offices, there is no denying that we still have much to
do in some areas of the region. Having taken a major
step forward in Leeds and West Yorkshire, it is now
our intention to focus our efforts on demonstrably
developing our offering to Sheffield and South
Yorkshire.
We are currently targeting a number of
senior and high profile lateral hires which I
hope to be able to announce in the next edition
of atticus!
Strengthening our business and our offering
Lupton Fawcett Lee & Priestley Managing Director, Richard Marshall, explains our acquisition of long-established Leeds-based law firm, Lee & Priestley, and how by joining forces we’re better positioned than ever before to help our clients meet the challenges they face.
A Lupton Fawcett Lee & Priestley Periodical. Issue 3 02/03
If you have ever been involved with the sale or
purchase of a business, or are a service provider
tendering for contracts, it is likely that you will
have experience of the Transfer of Undertakings
(Protection of Employment) Regulations 2006
(TUPE). It is safe to say that TUPE has out-
performed most other UK legislation in generating
confusion and contentious disputes.
TUPE derives from European laws, which require the
UK to implement its own domestic laws to protect employees’
employment when their employer changes. Examples include
when their current employer decides to sell his business
and move on (a business transfer) or when the contract on
which the employees are working is taken away from their
current employer and passed on to a new contractor (a service
provision change). However, since TUPE was introduced, it has
been widely criticised as being overly bureaucratic and too
generous in its provisions, which go way beyond its European
ancestor. The UK’s “gold-plated” version of the European law
has been said to be a significant burden on UK businesses,
especially those that frequently tender for service contracts.
However, all may be about to change! In late 2011, the
Government placed TUPE under review to see how it could
be improved. In doing so it announced a Call for Evidence,
through which businesses, unions and academics (to name
a few) put forward their opinions on the effectiveness and
defects of TUPE. Then on 17 January 2013, after digesting the
nation’s views, the Government finally announced its proposed
changes to the regulations.
In this article we examine some of the more
common issues faced by businesses, and address
some TUPE-related myths. We also consider how
these issues might be resolved, if at all, should the
Government’s proposals materialise.
Service Provision Changes (‘SPC’)As mentioned, in addition to the sale of a business,
TUPE also applies where there is an SPC. A common example
is cleaning services. Some businesses employ their own
cleaners but then decide to outsource the cleaning duties to a
separate company. On the other hand, some businesses that
already engage the services of an outside cleaning company
may decide to use a different service provider or, to try and
cut costs even further, do it themselves. All of these situations
currently amount to an SPC under TUPE.
This however is a step beyond what is required under
the European laws, and so this has arguably been the most
extreme case of “gold-plating” within TUPE. Now, in a radical
change of heart, the Government has decided to remove
entirely the parts that relate to SPCs. Incidentally, this will not
result in SPCs being removed from the TUPE regime; however,
it will become more difficult to identify whether or not TUPE
does apply to an SPC under the proposed new legislation.
Unfortunately, this level of ambiguity is likely to result in a
greater number of disputes between service providers engaged
in tender processes.
Under the current TUPE regime, incumbent contractors
will feel somewhat confident that if they lose a contract they
will at least be able to offload a number of employees with it,
thereby avoiding the alternative of redundancy costs. This
may not be the case following the proposed changes, which
could put existing contractors in a position where they are
stripped of their contract and left with the liability for their
employees. Any employers that are currently in a tender
process, or envisage being in a tender process, will need to bear
these new laws in mind when evaluating their bidding.
The Government is proposing a lead-in period for this
particular change which means it could be between one and
five years before this comes into effect. However, contractors
who are involved in tendering for new contracts now would be
well advised to ensure that bids and contracts deal specifically
with the issue of TUPE, and provide protection for the
contractor in the event that the law changes before the end
of the contract term.
Harmonising terms and conditions following a TUPE transfer
One of the most commonly asked TUPE questions
is whether or not the transferee (the buyer of the business
or the incoming contractor) can amend the transferring
employees’ terms and conditions after the transfer to match
those of their existing workforce, so that everyone is on the
same terms and conditions. After all, this would make perfect
business sense and make life a whole lot easier in terms of the
administration required.
Under the current TUPE this process of harmonisation
is by no means easy. Whether or not an employer is permitted
to make changes to employees’ working conditions under the
current regulations will depend on the type of change being
made. TUPE envisages three types of changes, namely;
1. changes which are unconnected to the TUPE transfer - these
are allowed (subject to them being reasonable);
2. changes which are connected to the transfer - these will
usually be void, and therefore unenforceable, except where
there is an ETO reason for the change (see below); and
3. changes where there is an insolvency situation - these are
allowed, subject to certain conditions being fulfilled.
Changes which are connected to the transfer may
be permitted if they are for an “economic, technical or
organisational reason entailing changes in the workforce”
(otherwise known as an ETO reason). However, ETO reasons are
interpreted narrowly, which in practice means that employers
can only rely on them in very limited circumstances.
It is also irrelevant whether or not an employee agrees
to any proposed changes. TUPE still says the change will be
void unless one of the exceptions applies!
However, within the Government’s proposed changes is
the introduction of a new clause that will allow the employer
and employee to agree any changes that could have been
agreed if the transfer had not taken place. This does not
entirely resolve the problem, because changes proposed
where the transfer is the reason for the change will still be
prohibited – this is still the case under European legislation
and the Government is not allowed to introduce UK legislation
that contradicts the European directive. This means that
harmonisation of contracts will still not be allowed, as the
reason for the harmonisation is the transfer itself.
Who is liable, the transferor orthe transferee?
Under TUPE, the basic rule is that all “rights, powers,
duties and liabilities” relating to the employees transfer
from the transferor (the seller or outgoing contractor) to the
transferee (the buyer or incoming contractor) at the time
of the transfer. Whilst the transferee benefits from a rapid
injection of manpower, it also takes on the liabilities that
come with them. This means that if the transferor breaches
an employee’s contract before the transfer, the transferee
becomes liable for that breach after the transfer. This is
assuming that the employee does not object to transferring to
the buyer before the transfer takes place. Where an employee
does object to his employment transferring, his employment
is treated as terminated with both the seller and buyer. In that
event, neither employer is liable for the termination.
However, where it starts to get a little tricky is when
the employee’s objection is in response to proposed changes
by the transferee to the employee’s working conditions that
are to his material detriment. Under these circumstances the
employee is entitled to object to the transfer and treat himself
Paul Sands
Untangling the mythsaround TUPEEmployment Law specialist, Paul Sands, considers the controversial TUPE regulations, tackles some of the common issues faced by businesses, and looks at the Government’s proposed reforms to the law.
as having been dismissed. Further, in these circumstances
the employee will be automatically treated as having been
unfairly dismissed by the transferor.
For example, consider the circumstances where an
employee has a mobility clause in his contract allowing his
employer to relocate him to different sites. The transferee
informs the employee that following the transfer he proposes
to change his place of work 50 miles from his current site.
As there is a mobility clause in the contract, this change
would not be a breach of his contract. Even so, the transferee’s
proposal would still amount to a change to his working
conditions, which would allow the employee to resign and treat
himself as unfairly dismissed.
This potential risk is made worse in circumstances
of an SPC, where the transferor cannot prevent the transfer
from going ahead and is therefore stuck with the effect of the
transferee’s proposed changes.
Under the Government’s new legislation this issue will
be partially improved. Unless the proposed change by the
transferee also amounts to a fundamental breach of contract,
any objections and subsequent resignations by employees are
unlikely to give rise to unfair dismissal claims. Using the same
example above, under the new statutory regime the employee
would not be entitled to claim unfair dismissal, and his
compensation would likely be limited only to his notice pay.
However, where the proposed substantial and
detrimental change would also amount to a serious breach
of the employee’s contract the transferor would still be liable
for any unfair dismissal claims. Whilst this is not ideal, the
Government’s hands are somewhat tied as these are the
minimum rights that the European law requires the UK
to implement.
Dispelling the myth of TUPEand assignment
We often hear businesses say that “the employee
spends more than 50% of his time on the business which is
transferring, therefore he must transfer under TUPE”. This is
a common misunderstanding. Whilst there are no proposed
changes on this point, it is still worth mentioning given the
level of confusion that has been created around this issue.
Whether or not an employee transfers under TUPE
with a contract part of a business has little to do with the
amount of time he spends on that contract. The correct
question is whether that employee is part of an organised
grouping of employees which has been put together with the
specific purpose of servicing a particular contract or business.
This was put squarely into context in the recent case
of Seawell Ltd v Ceva (Freight) UK Ltd, where an employee
who spent 100% of his time working on a contract was found
not to be assigned to that contract. The employee in this case
just happened to spend all of his time working on a particular
contract at the time of the transfer. However, his employer had
never consciously assigned him to that contract, and as such
was not necessarily bound to it. In contrast, it is quite possible
that an employee who is specifically employed to service two
parts of the business, with a 70/30 split of his time, would
transfer under TUPE if the part of the business which takes up
70% of his time is sold.
Employee Liability informationOne of the more helpful provisions of the current TUPE, is
that which relates to the duty of the transferor to provide
the transferee with certain prescribed information about the
employees before the transfer. This helps to create more
transparency between the transferee and transferor. It is a
little surprising therefore that the Government now proposes to
remove that provision. But what will that mean for employers?
Presently under TUPE, the transferor is required to provide
to the transferee, at least 14 days before the transfer, the
following information;
1. the identity and age of the employees;
2. their employment particulars;
3. details of any grievance or disciplinary procedures
taken within the last two years;
4. details of any court or tribunal cases, claims or actions
brought by employees within the last two years
(or that may be brought by the employees); and
5. details of any collective agreements.
Parts 3 and 4 in particular can be very helpful to a
transferee as they enable it to assess any potential liabilities
that it will adopt under TUPE. If the transferor fails to provide
this information, the transferee is entitled to bring a claim in
the Employment Tribunal. The level of compensation in these
types of claims is a minimum of £500 per employee, and can
be considerably more.
However, under the Government’s proposed changes
the above rules are to be repealed. Instead, the Government
will largely leave it to the parties’ discretion as to what
information is to be provided prior to the transfer, and when
that information is to be provided. Further, only information
which is necessary to enable the transferor and transferee to
properly consult with employees must be disclosed. Failure
to comply with this will result in the transferor and transferee
sharing the liability for any failure to consult with employees.
Whilst it is expected that this will allow greater
flexibility for the transferor and transferee, it will also leave the
transferee somewhat blindfolded to potential risks.
For example, the transferor will no longer be duty-bound
to provide details of potential claims that will become the
transferee’s responsibility, as that information is not necessary
to enable the transferee to consult with employees.
This will pose greater risks for businesses tendering
for service contracts, where the transferee is unlikely to have
any contractual rights against the transferor. The Government
will be issuing guidance as to the types of information that
should be provided by the
transferor, and so it is hoped
that this may prevent any
arguments between transferee
and transferor.
Watch this spaceOf course the
Government’s proposals are
indeed just that, “proposals”.
As such they have not yet
been approved into our laws.
Businesses will need to keep a keen eye on these proposed
changes, especially those relating to service provision changes
which, if removed, could leave employers with a hefty, and
unexpected, redundancy bill. The issues which are highlighted
above are just some of those which we, and our clients, have
encountered over the years, and there are a number of other
changes being proposed which have not been covered under
this article.
If any businesses are concerned about falling into
an expensive TUPE trap, we are here to help you avoid
those pitfalls. If you have experienced problems, or need
help with any aspect of TUPE, please contact us on
0113 280 2000 (Leeds) or 0114 276 6607 (Sheffield).
A member of our Employment Team will be happy to talk
through your situation and ensure that you remain TUPE
compliant and reduce or avoid liabilities.
A Lupton Fawcett Lee & Priestley Periodical. Issue 3 04/05
Whether or not an employer is permitted to make changes to employees’ working conditions will depend on its reasons for making those changes.
Tax planning ranges from the simple and innocuous (paying into an ISA or pension scheme) to the convoluted and artificial ‘tax avoidance’ (the K2 type scheme). It is important to distinguish these from tax evasion, which involves dishonesty by not declaring taxable income and is a criminal offence. News articles have frequently referred to certain tax planning arrangements as “legal” in order to make it clear that they are not tax evasion.
Successive Governments have tried to prevent the K2 type planning whilst still allowing people flexibility in how they structure their tax affairs. The difficulty comes in defining what constitutes ‘acceptable’ tax planning and what is ‘tax avoidance’. Changes to tax laws have helped prevent specific types of planning, but fall short of creating a blanket of legislation against tax avoidance.
We’ve also seen the courts become increasingly inclined to find against tax avoidance schemes, with judges adopting a looser interpretation of the rules. Tax avoidance schemes now rarely succeed before the tax courts.
The tough economic climate has put the undesirability of tax avoidance in the spotlight, with Jimmy Carr and Take That just two of the celebrity examples highlighted. In the case of Starbucks, many individuals actually urged a boycott. Reputational risk is therefore now a huge issue that must not be overlooked.
A major development on the horizon is in the shape of a general anti-abuse rule, which is due to come
into force on 1 April 2013. The rule will apply to tax structuring which cannot be regarded as a reasonable course of action in relation to the relevant tax rules.
In deciding whether it can be regarded as such, HMRC, the courts and a specially-established advisory panel will look at factors such as the artificiality of the arrangements and whether the tax treatment significantly differs from the economic substance of the arrangements. This is likely to catch contrived arrangements such as the K2 scheme, but unlikely to catch some of the international tax planning which has been under the spotlight recently. The latter is better addressed through a tougher application of existing tax legislation, such as the transfer pricing rules.
Those who have implemented tax planning which is challenged should check the accuracy of any advice or representations made by their advisors or scheme promoters. If there were inaccuracies there may be legal recourse against the advisor or scheme promoter. In a recent court decision (Horner v Allison), an individual who implemented an unsuccessful tax planning scheme was able to claim damages against an individual for fraudulent misrepresentation as to elements of the scheme and her degree of experience.
For expert advice on tax planning and the right approach for you and your business, contact Melanie List on 0113 280 2065 or melanie.list@lf-lp.com.
Following the recent furore surrounding tax avoidance, focusing on celebrities and multinationals such as Starbucks and Vodafone, we take a closer look at how some people are taking tax advice to the limit.
You may have heard about the 10% tax on profits from patents – the so called ‘Patent Box’. This is a significant development and it is important to understand what it means for your business:
1. Although still a proposal, it is being given serious consideration for 2013.
2. The 10% tax rate looks likely to happen so it is worth talking with your tax advisor to understand the implications for your business.
3. The reduced tax applies to profits from patents, so it would be prudent to review your strategy for obtaining patents.
The Government has stated that: “The Patent Box will allow companies to elect to apply a 10 per cent rate of corporation tax from 1 April 2013 to all profits attributable to qualifying intellectual property (IP).
“Qualifying IP includes patents granted by the UK Intellectual Property Office (‘IPO’) and the European Patent Office (‘EPO’), as well as supplementary protection certificates, regulatory data protection and plant variety rights.”
The tax will apply to existing and new IP, as well as bought IP, as long as the owner has further developed it or the product it relates to. The legislation also outlines a structured approach to calculating the profits from qualifying IP.
This tax break offers a real reason to invest in patents and our experts can help you understand the process and obtain patents on your behalf.
You can read more about the Patent Box at: www.hmrc.gov.uk/budget2012/tiin-0726.pdf or contact John Sykes on 0113 280 2113 or john.sykes@lf-lp.com to discuss this further.
Lifting the lid on The Patent Box tax
News in brief
The thorny subject of tax planning
For anyone in the process of, or considering a
divorce, the issue of how to divide your finances
can be both sensitive and contentious. When trying
to reach a financial settlement you may choose
to negotiate directly with the other party, attend
family mediation, engage in the collaborative law
process, take part in traditional solicitor-based
negotiations, or even begin court proceedings.
However you decide to seek a resolution, the
following factors, as set out in section 25 of the Matrimonial
Causes Act 1973, should be taken into account:
• Income, earning capacity, property and other
financial resources which either party has or is likely
to have in the foreseeable future.
• The financial needs or responsibilities that
either party might have or is likely to have in
the foreseeable future.
• The standard of living enjoyed by the parties prior
to the marital breakdown.
• The age of each party and the duration of the marriage.
• Any physical or mental disability of either party.
• Contributions which each party has made or is likely
to make in the foreseeable future to the welfare
of the family.
• The conduct of the parties if, in the court’s opinion,
it would be wrong to disregard it.
• Any loss of benefit under pensions.
• Any other relevant circumstances.
In cases where children are involved, their welfare will
always be at the forefront of considerations, but some
or all of the above factors may be relevant.
When parties seek a binding and enforceable
agreement by asking the court to make an order to reflect
the terms of any agreement reached, it is worth noting that
the court can and does refuse orders which it thinks are
not fair to one or both parties. Courts do not simply
rubber-stamp applications for consent orders.
What is fair?The definition of ‘fair’ largely depends on the parties’
individual circumstances and is influenced by recent case
law in addition to the statutory criteria previously stated.
The starting point set out in the famous case of
White v White in 2001 is an equal division, but there are
many reasons to move away from this precedent. For
example, one party may earn more than the other; there
may be minor dependent children whose primary home
is with one party; or there may be issues such as inherited
assets and premarital acquired wealth and contributions
to take into account.
It is also important to understand the powers that
the court has in divorce cases. It can, for instance, order
properties to be sold or transferred to the other party, or one
party to have a deferred charge type arrangement over the
property. It can also make orders in relation to income, such
as spousal and child maintenance and pension provision.
Judges in such cases have a great deal of discretion
as the law is based not just on the statutory components of
the Matrimonial Causes Act 1973, but a whole host of case
law which is constantly evolving and filtering down from
the High Court, the Court of Appeal and the Supreme Court.
Parties sometimes don’t realise that there should
be an unequal division of capital based on their own
financial circumstances. For instance, one or both parties
may have business or family trust interests, or other
investments, to be valued and considered.
There is also the common misconception that all
pensions are the same and it is as simple as adding the
values together and dividing by two. This thinking fails
to take into account the fact that one person may have
a final salary scheme and the other may have a money
purchase scheme, which further highlights the importance
of seeking specialist advice.
The Law Commission is currently looking into two discrete
issues of financial relief:
• The extent to which one party should be
required to meet the other’s needs after the
relationship has ended.
• How non-matrimonial property (i.e. property
acquired by a party prior to the marriage or civil
partnership or received by gift or inheritance)
should be treated on divorce or dissolution.
The report is expected shortly and it is not yet known
whether it will lead to legislation changes.
How Lupton Fawcett Lee & Priestley can helpIf you are faced with financial issues following marital
breakdown, it is worth seeking independent legal advice
before getting involved in meaningful settlement discussions
or reaching formal agreement with the other party. These are
considerations which can
have an enormous effect
and impact on the rest of
your life.
Lupton Fawcett
Lee & Priestley’s Family
and Divorce specialists
offer a wide range of
family law services.
We are vastly experienced
in dealing with financial
matters associated with relationship breakdown,
particularly those involving high net worth assets,
and we will ensure you get a fair deal.
Find out more by calling Andrea Dyer at
our Leeds office on 0113 280 2090.
A Lupton Fawcett Lee & Priestley Periodical. Issue 3 06/07
The cost st of
The definition of ‘fair’ largely depends on the parties’ individual circumstances.
Andrea Dyer, Head of Family and DivorceServices at Lupton Fawcett Lee & Priestley,
explains the importance of seeking specialist legal advice to protect your finances during a separation.
Andrea Dyer
Local property taxation in the form of business
rates represent a significant cost to businesses,
and contributes around £24 billion annually to
the Exchequer.
In a recent PwC survey of the Total Tax
Contribution of the top 100 UK companies, business
rates accounted for 15% of their annual tax contribution,
and were the third largest tax after Corporation Tax
and employers’ NIC. For smaller companies, rates are
typically the second largest tax after Corporation Tax.
This is why it surprises me that when my
advice is sought about business rates it is usually the
Property Manager rather than the Finance Director or
Tax Manager asking the questions. Rates are a tax and
I would urge finance and tax specialists to take a far
greater interest.
A tax on occupation The origin of rates can be found in the Poor
Relief Act of 1601 and began as a tax on
the value of occupation
of land. Rates are also a
fairly arbitrary tax, and the
general impression is that
there is no way to reduce
the charge other than by
the usual rateable value
appeal – but there are other
avenues to explore.
Rates are unusual
in that they rely on two
taxing bodies. HMRC use
the Valuation Office Agency
(VOA) to set the basis for the
tax by allocating a ‘Rateable
Value’ to a property. The
Local Authority then
demand and collect the
rates, as well as determine
reliefs and exemptions.
When targeting business
rates cost reduction, the
level of this Rateable Value
is often the first port of call
through discussions with the
VOA. But the system also
allows for discussion with
the other party to levying
the tax – the Local Authority.
Within the Local
Government Finance Act
a number of mechanisms
exist that allow the Local
Authority to reduce, remit
or remove rates in certain
circumstances. Charitable,
non-profit-making
organisations, sports clubs
or ratepayers suffering
hardship have long been
able to secure reductions in
rates liability. Additionally,
from 1 April this year, the
Government has granted
Local Authorities the power
to create their own local discounts. It remains to
be seen how or if these new powers will be used.
One of the least-publicised reliefs is for
where a property is in partial use for a short
time. When combined with a special rule that
enables inactive machinery or office equipment
to be ignored, this relief can be very valuable in
a wide range of circumstances.
Understanding backdated billsThe ‘two taxing bodies’ system has disadvantages
for ratepayers who are pushed from one to the other
whilst trying to avoid the traps lying in wait for them.
With most taxes, once HMRC has assessed the tax
due and this is paid, that is generally the end of the
matter. Rating is unique because the VOA can change
the rateable value retrospectively or value unassessed
properties at any point within the current 5-year
rating cycle which began on 1 April 2010. The rules are
complex and a valuation “limitation” rule can be invoked
by the ratepayer in the right circumstances.
Where a Local Authority levies a backdated
demand, study this carefully before paying. There is
actually a wealth of case law, culminating in the North
Somerset case, that dictates a backdated rates bill may
not be legally due or payable.
The rules behind empty ratesIn 2007, the previous Government decided to reform the
rating system by extending the scope of rate charges on
empty properties. Since 1966 there has been a steady
move towards empty rates, but the changes that took
effect on 1 April 2008 introduced a 100% empty rate
charge on empty industrial properties after a 6-month
initial rate-free period, and after 3 months on offices
and shops.
Empty rate mitigationWith empty rates becoming a real problem to many
owners, there has been a lot of focus on these tax
charges. There are legitimate ways to remove the
empty rate burden, such as by agreeing shorter
term lettings. A new occupier, providing they stay in
occupation for more than 6 weeks, has the double
advantage of a new rate-free period being generated
once they vacate the property.
For older buildings, the VOA has a statutory
presumption that a building is in good repair, and
they are not always persuaded that a property in poor
condition should be removed from rating. As a result,
the Local Authority would seek to continue to levy the
rate charges.
However, there are a number of empty rate
exemptions available, dependent on the physical
state of the property, and these can be explored by
rating advisors.
Get creative to avoid the rates burdenSome owners have turned to creative methods to remove
the rate liability. For example, short-term funded lettings
under licence to a charity have the potential to remove
a large part of the rates burden. Properties owned by
companies in insolvency proceedings are exempt from
rates if proper procedures are put in place, but some
sham schemes have been devised.
However, Local Authorities and the Government
are becoming more aware of these schemes, with Local
Authorities beginning to refuse rate reliefs and a number
of cases due before the High Court, which could spell
an end to some of these avoidance strategies. Recent
announcements from the Charities Commission and
the Insolvency Service have also made it clear that
charity trustees and insolvency practitioners involved in
outright avoidance would be subject to sanctions.
The moral of all of this is that wider
consideration should be given to business rates, and
when navigating the various routes to reductions, there
are numerous two-way streets and the odd dead end. In
all rating matters, professional advisors are there to point
the way. Always look for a member of either RICS or the
IRRV who will operate within their codes of practice to
get the best solution for your business.
Business rates – a two-way street?
Cost reduction and cash recoveries are more relevant than ever before, and property costs are a major burden for many businesses. Phil Vernon, Rating Specialist at PwC, shares his thoughts on why the issues of business rates should be of interest to more than just Property Managers.
PhilVernon
The devil in the detail
A Lupton Fawcett Lee & Priestley Periodical. Issue 3 08/09
If you feel held to ransom by your business rates, our Director of Commercial Property and Development Work, Russell Davidson, looks at ways to enjoy a little tax relief by questioning your current agreement.
Russell Davidson
ail
Many landlords and business owners simply accept the terms
of their business rates, but with some thought and careful
drafting there are a number of practical steps you can take to
deliver significant benefits.
Clarifying your lease burdenA tenant, not wishing to renew their lease, might move out during or
towards the end of the lease. As the landlord, you might then find the nil
rate period has expired. One way to prevent this happening is to include
within the lease a provision that the tenant should reimburse you for this
loss if they move out prematurely.
The rateable value of commercial premises is assessed by the
Valuation Office Agency (VOA). It often works to historic figures and it is
important to know that the original information submitted when your
premises was first assessed may be old. Both tenants and landlords should
also keep an eye on the rental values of comparable premises in their areas,
and lodge an appeal against the rateable value of any property that appears
over-rented.
When submitting rateable value information to the VOA, make
it clear exactly what services are and are not included in the rent. If a
number of landlord services are included, this implies that the element of
the rent attributable to occupation is less than the headline sum, so make
sure it is the true occupation cost that the VOA take into account.
Calculate the cost of tenant incentivesIn the current letting climate it is common to offer long rent-free periods
and landlord inducements such as fit-outs and other services. Again, the
value of these should be assessed. If the VOA has focused only on the
headline rent, it can be argued that a substantial rent-free period or other
inducement has not been taken into account when assessing the true
rateable value of the premises.
Dealing with difficult to let propertiesEven before Gordon Brown increased the empty rates burden from 50% to
100% of the rateable value, owners of hard to let properties were stripping
roofs off and doing other work to make premises uninhabitable in order
to reduce the rateable value to nil. Both the VOA and Local Authorities
are wise to such actions and are now much more reluctant to remove
premises from the valuation list.
This is where the opinion of a reputable valuer can help; areas
change as does taste in buildings, and some properties may indeed be
incapable of attracting an occupier. Even squatters are more choosy than
they used to be!
Do not be afraid to question the VOA.
The evidence of a prolonged letting
campaign, plus a surveyor’s opinion
that there is no market for that
particular property in that particular
area, forms a powerful case in arguing
against a rates assessment on a building.
Remember that VOA employees are extremely stretched, so
include in your submission details of any marketing campaigns you have
undertaken and photographs showing the state of the property. There is no
duty on a property owner or occupier to keep a building in pristine repair
so the VOA is obliged to assess the property as it is on the date of valuation.
Property and business acquisitionsAlways ensure the acquisition document clearly states who is responsible
for business rates. If you are selling or letting a property and the buyer or
tenant is late in completing, does the contract make it clear that they are
obliged to pick up the rates liability for the period of non-occupation?
If not, then the seller or landlord is liable.
Similarly, if your agreement allows for early occupation
by the buyer or tenant – in advance of completing the disposal or
letting – is it clear who pays the rates? Business rates liability falls
on the party in effective occupation and control of the premises.
So, suppose you sell a property but want to store goods in it
temporarily or share its use for a short period with the new owner
– again, does that count as occupation and control for the purposes
of the rates liability? These are just some of the questions that the expert
team at Lupton Fawcett Lee & Priestley can answer for you.
Steer clear of questionable advisorsLots of firms offer to reduce business rates liabilities and do so on a
“no win no fee” basis. Treat these companies with caution and be sure to
check the small print as some charge for each year of saving, which can
add up to much more than would be the case for a surveyor paid on a
normal time spent basis.
Using a reputable surveyor will save you money in the long run as
most will agree a fixed fee for trying to get a rates reduction, which may
include an uplift if they secure a certain saving.
Agreeing a deal with the VOAIf you lodge an appeal with the VOA you may receive a call offering to do a
deal rather than pursue a valuation tribunal. Preparing a tribunal involves
a lot of work which they would rather avoid where possible. These deals
are usually done over the phone with calls often recorded. Be sure to get
your facts straight in advance as once you have done the deal you will be
held to it.
If you want to take control of the business rates you pay,
and explore ways of managing your properties more intelligently,
call Russell Davidson on 0113 280 2138 or email
russell.davidson@lf-lp.com.
Many factors can impact on cash flow, including
poor management, a downturn in revenue and
an increase in expenses. In the construction
and building industry, disputes between
employers, contractors and sub-contractors
can be a primary cause of cash flow problems.
For that reason, it makes good business sense
to avoid conflicts during construction-related
projects and quickly and efficiently resolve any
disputes that do arise. Whilst no-one enters into
a contract with the intention of getting into a
dispute, it is still important, prior to entering
into a construction contract, to consider ways of
minimising the chances of conflict both during
and at the end of a project.
Get your agreement in writingTo secure a job it can be tempting to ignore the hassle
of paperwork and proceed on a simple handshake or
‘gentleman’s agreement’. This is risky, as if a dispute
does arise there is no written contract to refer back to.
You could then find yourself in a position where a court or
third party resolves your dispute based on whose witness
evidence they prefer, regardless of whether that reflects
the initial agreement.
To avoid such a scenario, all parties should take the
time to agree, document and sign terms at the outset. This
doesn’t have to be complicated or expensive, but it is worth
getting professional advice. A well-drafted contract should:
• Be clear about the identity of the parties
entering into the contract.
• Be specific about the scope of the work,
and reference where possible the plans
and specifications.
• Set out in full the responsibilities of each party.
• Be clear about the payment terms and dates.
• Set out on what basis an extension of time for
completing the works will be granted, and the
procedure for doing this.
• Set out what, if any, damages can be claimed in the
event that the works are not completed on time and
no extension has been granted.
• Set out the procedure to follow in the event that the
contract has to be amended e.g. to allow for a change
in the scope of the works.
• Contain an entire agreement clause, which prevents
the parties from relying on any statements or
representations other than those expressly set out
within the contract.
• State what procedures can be used in the event
that a dispute cannot be avoided.
When disputes ariseThere are a number of ways in which construction and
building disputes can be resolved, and it is not always
necessary to resort to the courts. The most appropriate
method will vary from contract to contract, and all parties
should consult with their legal advisors about the various
options before entering into the contract.
If a resolution cannot be reached by way of
discussions or negotiations between the parties, then the
two main alternatives to commencing court proceedings
are adjudication and arbitration.
Keeping cash flowingAdjudication was introduced as a way of quickly resolving
construction and building disputes and protecting cash
flow whilst the project is ongoing. Usually concluded
within 28 days of being referred, the adjudicator’s decision
is binding unless and until the dispute is closed through
litigation, arbitration or agreement. This ensures that the
project can continue with minimum impact on cash flow.
Until recently, only disputes arising out of written
contracts could be referred to adjudication,
but it now also encompasses oral contracts.
Nevertheless, it remains good practice for the
terms of contract to be documented in writing.
Seeking an expert opinionArbitration is more formal than adjudication and
more flexible than litigating a dispute through
the courts. It is often preferred to litigation as all
parties are bound by confidentiality, which does
not apply in court proceedings.
The arbitrator is often someone with a
construction background, which can be reassuring
if the dispute is of a technical nature. The parties
can refer, within the construction and building
contract, to a specific arbitrator; or an organisation
such as the Chartered Institute of Arbitrators will
appoint one if asked.
As the arbitrator’s decision is final and
binding it can be considered as more certain than
adjudication. The main disadvantage of arbitration
over adjudication is that it is far more time;
consuming and expensive.
Letting the courts decideThe very last resort is to go down a litigation route, which
means letting the courts rule on your dispute. This can be
costly and time-consuming. In most cases it is therefore
clearly beneficial to pursue alternative dispute resolution
processes rather than litigating through the courts.
Other methods of dispute resolutionOther options for resolving construction and building
disputes without recourse to the courts include:
Expert Determination – where an expert who is familiar
with the technical issues disputed is jointly appointed by
all sides to determine the dispute between them, often on
the basis of written submissions only. The decision is then
legally binding.
Early Neutral Evaluation – a non-binding process in
which an independent third party, appointed by all sides,
gives a non-binding assessment of the merits of any claim.
Mediation – where an independent third party will assist
all sides with negotiating their own binding settlement.
If the parties work together prior to entering into a
contract, to ensure that it is as comprehensive as possible,
then the chances of ending up in a dispute with one
another should be minimised.
In the event, however, that a dispute cannot be
avoided, both parties should seek legal advice about the
dispute and the options for resolving it at the earliest
opportunity. This should ensure that there is as little
disruption to the cash flow cycle as possible – something
which is more important than ever before.
ClaireMoss
Building bridges
Claire Moss from our Building and Construction team takes a look at the impact disputes can have on your business, and outlines how Lupton Fawcett Lee & Priestley can work to protect your interests and avoid expensive, lengthy conflicts before they happen.
A Lupton Fawcett Lee & Priestley Periodical. Issue 3 10/11
Crowd Funding: the more the merrier
With lending from banks hard to come by, individuals are pooling resources to fund everything from businesses to creative projects. Andrew Lindsay, Head of Corporate Finance at Lupton Fawcett Lee & Priestley, and a Director of the Leeds, York & North Yorkshire Chamber of Commerce, looks at the Crowd Funding phenomenon and asks, could it work for you?
Andrew Lindsay
Crowd Funding is all about collective
lending and investing, and where the
banks have stepped out, individuals are
stepping in. The concept originated in
the USA as a way for people to group
together and pool their money to fund
what were initially creative projects, such as
films and theatre productions.
The idea originally focused on the giving of non-
financial rewards, such as tickets to a project’s premier
in return for finance, which was a way to get around
the investor protection regulations. It has now evolved
significantly.
In the UK, a share offering by a private limited
company is governed by the Financial Services and Markets
Act 2000 which, on the grounds of consumer protection,
greatly restricts the type of individual a company can
promote or offer shares to. Crowd Funding, however, has
bowled the regulator something of a ‘googly’ in both the USA
and the UK.
Businesses are now using novel fundraising
methods to navigate their way through financial services
regulations, which were designed to prevent this sort of
unregulated activity from occurring. Increasingly, crowd
funders are devising schemes and utilising loopholes that
allow a company to offer its shares
to the world at large, and this is
greatly increasing the chances of a
new venture achieving its funding
objectives.
Individuals are coming
together online to fund a company
in return for the possibility of some
reward. Investors ‘bid’ on normal
commercial terms, in return for
either a shareholding or a loan. The
company then typically considers
the various offers and accepts those
which it finds most favourable.
The Crowd Funding optionsThere are several models of
Crowd Funding. The first utilises
donations, the second debt finance,
and the third equity finance.
Donations model – This model
sidesteps financial regulations by
offering gifts instead of equity/debt in return for funding.
Funders provide money to a company or to fund a project,
either for no return or in return for some form of non-
financial reward. The gift could be a bespoke recognition
in the product, or a meeting with the creators, etc. This
model is largely used in the creative sector and laid the
foundations for the other variations that followed.
Lending model – This method has proved increasingly
popular and provides businesses with an alternative to
traditional bank lending. It allows funders to provide
money by way of a loan with a requirement that it is
repaid with interest. The funders can propose at what
interest rate the loan is repaid, and the company seeking
finance can then choose to accept the loans that it deems
most suitable. To fit in with the current regime, the loans
must not involve the provision of consumer credit.
Securities model – As a general rule, under the Financial
Services and Markets Act 2000: ‘a person must not, in the
course of business, communicate an invitation or
inducement to engage in “investment activity”’. This
creates a position whereby a private limited company
cannot approach the public at large to seek investment in
return for an equity stake. Companies can now, in the
main, approach ‘high net worth individuals’ and
‘sophisticated investors’, where investor protection
regulation is less onerous; but, by only approaching these
types of individuals, the market for raising finance is
potentially reduced.
There have been two main approaches used to get
around the restrictions of the current regulatory regime:
1. Where FSA authorisation is requiredIt is possible to get FSA authorisation to arrange deals in
units through a collective investment scheme. This model
makes use of an exemption under the current regime by
only promoting to individual investors who are deemed
adequately knowledgeable about the risks. Due to the
nature of the selection process involved with this model,
the number of potential investors may be limited when
compared with the model below.
2. Where FSA authorisation is not requiredThis model relies on certain exemptions and loopholes
contained within the UK regulatory regime that allow a
company to approach the public at large for investment
in return for an equity stake. The company using this
model does not require FSA authorisation, but the Crowd
Funding platform must be approved by a person
authorised by the FSA.
The FSA did not envisage the emergence of Crowd
Funding and the regulatory regime does not sit
particularly comfortably with it. It is likely that UK
regulation will be introduced at some point in the near
future to ensure a regulated marketplace for this activity,
and to provide adequate investor protection.
One course of action for Parliament would be to
follow the USA and its implementation of the “Jumpstart
Our Business Startups Act” (the “JOBS Act”) to further
deregulate this type of investment activity in the UK.
Could Crowd Funding work for you?Lupton Fawcett Lee & Priestley has recently been
involved in advising on a number of Crowd Funding
projects and the level of interest generated is steadily
increasing. If Crowd Funding is of interest to you or
your business, you can draw on our extensive
knowledge in this area. To discuss this further contact
Andrew Lindsay on 0113 280 2025 or
andrew lindsay@lf-lp.com.
Previously the Asset Management department of
Lupton Fawcett Lee & Priestley had been offering wealth
management services to private clients. This was established
in the late 1980s, and although providing financial services was somewhat
unusual for solicitors, we have always felt that our clients – including
those using our corporate services – are in essence ‘private clients’, with
the businesses they own and manage being the vehicles for creating,
maintaining and growing their personal and family wealth.
We see these services as a natural extension to the others
that we offer, in particular those of our Trusts, Wills and
Estates department.
A fresh approach to wealth managementLeodis Wealth is a bespoke wealth management company
that incorporates the activities and personnel of our Asset Management
department. We believe this independent, dedicated business is the best
way to meet the growing need for wealth management services. It also
creates a clear distinction in our operations to meet regulatory demands.
The Leodis Wealth team provides the comprehensive advice we are
known for, and we’ll continually explore ways of enhancing the service we
offer you – be that through new activities or the recruitment of specialists
with new skills and ideas.
Created with the modern financial environment in mind
Many firms in the financial services sector will have had to make
significant changes to their business models to meet the new regulatory
requirements which came into force this year. Commission-based advice has
had to be replaced by fee-based arrangements – we have always been
fee-based, so there has been no change or disruption in how we work.
In addition, we have never focused on selling products, believing
instead that our clients’ interests are best served by providing a bespoke
service that is right for their circumstances and requirements. Their hopes,
plans, attitudes and preferences are at the heart of what we do, and we
strive to ensure that a close, long-term working relationship is established
with the aim of realising their goals.
A service for whatever your circumstances requireCurrently, the services offered by Leodis Wealth include portfolio and cash
management, general financial planning, and a personal taxation service
for clients who need help completing their annual return.
Typically, clients will seek our advice when they have savings, a windfall
or an inheritance to invest, or existing investments which need reviewing
in light of changing market conditions. They may have pension
arrangements which are unclear or perhaps not right for them, or they
may need more general advice on their overall financial affairs and plans
to ensure they are complementary and understandable.
To make sure our clients always have access to the best advice
around we also work closely with Lupton Fawcett Lee & Priestley’s Wills
and Trust team, trusted third parties who provide specialist help, and any
other professional advisors they might want us to liaise with on
their behalf.
Sound financial planning has never been so importantIn the current economic environment it is vital to have a well-thought-
through financial plan in place. Prior to the economic crisis of 2008
investors could choose between the safety of cash savings – which would
produce modest returns – and riskier stock market investments which had
the potential to generate higher returns. The property market was also a
popular choice for investors’ funds, with price rises fuelled by the seemingly
endless supplies of cheap money from the banks.
However, the world is a very different place today. Interest rates on
cash savings have plummeted, and there are real concerns about the safety
and strength of many banks, including those high street institutions which
previously were regarded as …well, as safe as houses.
All of this highlights the need for the kind of expert support that
Leodis Wealth can offer.
The smart money is with Leodis WealthWe would be delighted to help with your investment and general
financial planning, and our industry expertise and unbiased advice
across a range of wealth management services will ensure that you
get the best deal possible. An initial meeting costs nothing more than
your time, and if you would like to talk about what we can do for you,
call Paul Smith of Leodis Wealth on 0113 280 2121 or email
paul.smith@leodiswealth.com. Alternatively you can visit the
Leodis Wealth website: www.leodiswealth.com.
A Lupton Fawcett Lee & Priestley Periodical. Issue 3 12/13
Protecting the health of your wealth
PaulSmith
We have recently launched a new bespoke wealth management company, Leodis Wealth LLP, to offer all our clients the financial planning and management needed in today’s challenging economic climate.
“Experience, talent, leadership and key skills, particularly at
director level, have never been so crucial to business growth,
and in some cases survival.” That is the view of Kevan Watson
of NED Connections, a unique organisation that connects
non-executive directors with SMEs.
The NED Connections service complements those provided by
other professionals, such as lawyers, accountants, insurers and venture
capitalists. Whilst these professionals offer business advice in their
specific field, their clients may benefit from the next tier of support
that a non-executive director can bring. Keen to see them prosper, some
professional services providers have even helped their clients tap into this
valuable resource.
Objectivity, creativity and invaluable experienceIncreasing pressure on SMEs and owner-managed organisations can lead
to some business needs being neglected, and this is compounded by the
misconception that recruiting at board level is simply too expensive.
That’s where a non-executive director comes in. As defined by the
Institute of Directors, a NED is a person who is not an employee of the
company and usually works part-time. NEDs have the same legal duties,
responsibilities and potential liabilities as executive directors, but they
can bring a different perspective to the role.
NEDs are usually chosen for their breadth of experience, relatively
high calibre and personal qualities. They can make a creative contribution
by providing objective criticism, and focus on board matters without
straying into executive direction. They may also have some specialist
knowledge that will help the board with valuable insights.
Above all else, they bring a degree of objectivity to boardroom
discussions by virtue of their independence.
Not just for big businessesHistorically, NEDs have been associated with large corporates
where the need for objective guidance and corporate governance
is in great demand. However, the SME sector also needs the
support and fresh thinking offered by bringing experienced and
talented non-executive directors to their boards.
One such company, full-service design and marketing
agency Magpie Communications, did just that.
The communications agency, which specialises in youth and student
campaigns, had arrived at a point where it was either invest and expand
or remain a niche provider with a modest, but healthy, turnover.
The business partners had sought advice about mentoring and coaching,
and after meeting NED Connections they realised they could recruit a
NED with sector-specific experience for around the same cost as a junior
designer. They decided to take the bold step of bringing a NED on board.
Non-exec’, Jules Caton, former MD of a marketing agency with
240 employees, was selected as the perfect match. Magpie director, Ged
Savva, said, “We believe we had reached a point where a high-calibre NED
with marketing, design, brand and business experience would help us
achieve our goals.”
Those goals were challenged by the incoming NED, who initially
concentrated on restructuring the financial strategy of the company,
which in turn redefined Magpie’s business plan. A strategy session helped
extend the boundaries set by Magpie through thoughtful questioning
and constructive criticism, and with the company encouraged to look
beyond its current sectors, it is already seeing growth in new areas. Board
meetings are now more structured and the NED is in regular contact
offering business advice – even adding creative input which resulted in a
major new client win.
“It is a brave move for such a young organisation to engage a NED
but it reflects their mature business approach,” Jules Caton said. Other
business owners and leaders appear to agree.
Bringing a fresh perspective to your businessSome, who already act as non-executive directors or have NEDs on their
boards, argue that SMEs have been largely ignored where non-executive
directors are concerned.
Margaret Wood MBE is the owner of ICW (UK) Ltd in Wakefield.
She employed a non-executive director and claims that without a NED her
specialist glass panel manufacturing business might not have survived.
“In any business you can become very insular. As owner and managing
director of a business I needed someone to challenge me, make me think
about what I was doing and plan the way forward”, she said.
Some NEDs are chosen because they have a specific skill
lacking on a board, whilst others have the industry experience and
contacts a business needs. This makes the matching of candidates with
organisations a careful process. Equally, it is not just a case of bringing
in friends or somebody who may have been a senior executive in a big
company, but who has no empathy with the requirements of a growing
SME. In Margaret Wood’s view, “the key thing is finding the right fit of
person for your board.”
For those organisations that do find the right individual the
benefits can be significant, not to mention cost-effective. As Margaret
concludes, “finding the right person as a NED brought me a huge return on
investment.”
To watch Margaret Wood’s account of her NED experience, plus
comments from other business leaders, visit www.nedconnections.com.
For further details on NED Connections contact Gillian Johnson on
0330 1000 961 or gillian.johnson@nedconnections.com.
The argument in favour of NEDs Professional legal advice, whilst extremely important, may not offer a total solution for business growth and improved performance. Kevan Watson, Head of Marketing and Communications at NED Connections, explains why the addition of a non-executive director (NED) can be the best decision many SMEs ever make.
KevanWatson
The smart choice of legal partner Colin Horsley, Property Consultant at the Austin Reed Group, shares his experiences of working with Lupton Fawcett Lee & Priestley and highlights how we deliver real value to his business.
You’ve been working with Lupton Fawcett Lee &
Priestley since 2010. What was the original problem
or challenge on which you engaged with them?
Initially we were looking for a legal partner who could
demonstrate an understanding of our business and the
challenges we face. Finding someone who ticked these boxes
was harder than it sounds, and we tried a number of firms in
London and Yorkshire with little joy.
I became aware of Lupton Fawcett Lee & Priestley and
their strong reputation when a Director with whom we had a
long-standing relationship joined the firm. This was the
catalyst for us to begin working together, and we have not
looked back since.
They have proved time and time again their ability to
understand our business and support us in a number of ways
across our entire operation.
What business areas do they support you in today?
We draw on Lupton Fawcett Lee & Priestley’s expertise in
all areas of property law, including acquisitions, disposals,
litigation and commercial matters. I am also aware of their
strong intellectual property offering, but to date we have had no
opportunity to tap into this.
There is one project in particular that springs to mind
and highlights how they used a range of specialisms to deliver
the right solution for us. The lease assignation of our prestigious
Regent Street store to Superdry, and the way that they managed
this complicated process, was very impressive. They not only
handled the assigning of our lease with the landlord and head
landlord involved, and helped us lease back some of the space,
but also took care of a number of other issues.
We were delighted by their efficiency and
professionalism throughout the process.
What differentiates Lupton Fawcett Lee & Priestley
from their competitors?
I would say it is their entire approach that sets them apart.
They have a very good understanding of our business and what
makes us tick, and they take a holistic view of how we operate.
Nothing is too much trouble and they go about their work in a
way that puts you at ease.
Here in the UK, we tend to seek legal advice when
we have business or legal problems, rather than
avoiding problems in the first place. What’s your
opinion of this approach, and have you benefited
from ‘The Law of Advantage’ that Lupton Fawcett Lee
& Priestley claim to put on your side?
As a business it is always best to know where you stand
legally, and it is reassuring to know that Lupton Fawcett Lee &
Priestley is there to provide that advice from the outset. In the
past, other firms have struggled to deliver the same level of clarity
and insight, and I think this is because they lack the commercial
acumen that Lupton Fawcett Lee & Priestley possess.
To me, it is this peace of mind knowing that we have the
right partner by our side that gives us ‘The Law of Advantage’.
Basic checks save money!Start-up businesses can save a lot of time, money and
trouble by carrying out basic checks on their proposed
trading, product or service names before putting them
into use.
A free search of the UK Trade Mark Registry
website www.ipo.gov.uk will tell you if your chosen name
(or similar) has been registered as a trade mark or if an
application to register it has been made. This site also
contains a good overview of intellectual property rights
and regulations.
Knowing your potential market can avoid litigationMake sure you complete your trade mark searches
before printing up stationery and corporate identity, to
avoid infringing an existing trade mark. Reprints and
the potential legal implications can be extremely costly,
especially during the start-up phase of a business.
Make protective domain registrations where possibleRegister your web domain name as soon as you can.
The process is relatively cheap so it is also worthwhile
considering registering similar words or abbreviations. This
prevents rival companies registering domain names that
use variations of your business name, which can mislead
customers and threaten the reputation of your business.
Maximise your legal protectionProtect yourself by registering your trade marks. You
can make money by doing this as you are not only
entitled to costs and damages if someone infringes your
rights, you can also grant licences to third parties for
future use.
Know what legal rights you have and use them effectivelyMake sure you use the ™ and ® notices correctly on all
your brand names. Some rights exist “for free”, such as
copyright and common law rights for trade marks, so you
should use the © and ™ notices wherever your copyright
works and trade marks are reproduced. If you have
registered your trade mark you can also use the ® notice.
Free marketing!Get free publicity by making sure your licence
agreements require licensees to print on all your
products, or their labels, the words “used under licence
from [your company name]”.
Keep records to protect your unregistered rightsWhen it comes to copyright works, always include the
© notice and date on which your work was originally
created, and post yourself a copy of the original, dated,
signed work and keep it somewhere safe.
Don’t forget design right protectionDesign rights can be obtained for designs that are ‘novel’
and have ‘individual character’. Sometimes a design
right registration can be obtained for your trade marks,
which can give you an additional monopoly right for the
outward appearance of the design.
Make more money from your design workAs with trade marks and copyrights, a design right not
only prevents other people from using your design, but
also allows you to sell or license the design to third parties.
Maximise the income from your IP assetsCertain design rights may exist automatically without
the need for registration, but you can still acquire a
licence fee if a third party wishes to use your design.
A word of warning about patents and secretsIf you disclose your idea for an invention without asking
the other party to sign a confidentiality agreement, you
could lose the right to get patent protection. The same is
true if you work on your invention in a publicly-accessible
place – which would include your garden shed.
Let us help protect what is yoursWhen you have invested your time and money into
developing an idea, it is only right you get to enjoy its
success. To do this you need the right expert advice to
protect your intellectual property.
Speak with John Sykes and his team of IP specialists
at Lupton Fawcett Lee & Priestley before you share
your idea with anyone, and they can talk you
through getting the IP protection your idea deserves.
Contact John on 0113 280 2113 or
john.sykes@lf-lp.com.
The secrets of smart IPJohn Sykes, our Head of Intellectual Property and Commercial Law, shares his top 10 tips for good IP practice, and points out some of the common pitfalls to avoid.
A Lupton Fawcett Lee & Priestley Periodical. Issue 3 14/15
JohnSykes
Business is never as usual at Lupton Fawcett Lee & Priestley –it is the result of our unique approach to client relationships.We are prepared to think in an untraditional way, and advise you as though we were advising our own business. It is a culture that has helped us form solid partnerships with Chairmen and MDs all over the country. We call it the Law of Advantage.
www.lf-lp.com
To some it’s aboutthe companythey attractTo us it’s about thecompany we keep
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