This page contains short summaries of recent commercial litigation developments which are of practical interest. April 2008
March 2008
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Updated: April 28, 2008 |
28 April, 2008
Extending time?
The Court of Appeal agreed with the first instance judge and struck out claims under the Human Rights Act and for false imprisonment. The questions raised included whether CPR 11 was engaged so that the filing of the acknowledgement of service prevented the defendant from arguing about the limitation period for the HRA claim and whether the court should extend the time limit.
The Court of Appeal agreed that it would be inequitable to extend time for the HRA claim and that CPR 11 was irrelevant. Limitation defences do not go to jurisdiction, but go to an assessment of the merits to the claim. In addition to clarification regarding jurisdiction under CPR 11, the decision confirms the approach to be adopted when a court is exercising a wide discretion.
21 April, 2008
It is difficult to obtain an injunction over material published on the internet
The News of the World published footage of Max Mosley on its website. After a complaint from Mr Mosley the News of the World removed the footage. In the short time that the footage had been on the News of the World website it was seen over 1.4 million times and it was copied by a number of other websites and so remained in the public domain.
As the court did not want to make a vain gesture, despite the publication not being in the public interest, the court did not grant the injunction to stop the footage being shown (again) on the News of the World website.
14 April, 2008
2012 Olympics Independent Dispute Avoidance Panel
An Independent Dispute Avoidance Panel has been set up to deal with contractual disputes during the work to deliver the venues and infrastructure for the London 2012 Olympic and Paralympic Games. They hope to find pragmatic solutions to problems and stop them turning into disputes.
7 April, 2008
Criminal liability of partnership as independent entity
The Court of Appeal has held that where criminal legislation expressly applied to a partnership as an independent entity and also dealt with the impact on individual partners, there was no reason to suggest that the provisions were not permitted or effective in law.
If business activities are carried out in the name of a partnership and the partnership has identifiable assets distinct from the personal assets of each partner, the partnership can be treated, in criminal law, as a separate entity from the partners.
If the legislation provided that proceedings could only be brought against an individual partner if that partner was complicit in the offence committed by the partnership, and only the partnership was indicted, then any fine would have to be levied against the partnership’s assets and not those of the individual partners.
31 March, 2008
Make sure your agreement matches what was negotiated
A claim relating to payment due under a development agreement required the court to construe a clause in the agreement. The relevant clause described an Additional Residential Payment which the claimant alleged was worth over £4.6 million and the defendant claimed was less than £900,000.
The defendant had tried to argue that evidence of the parties’ negotiation of the agreement should be considered by the court when determining the construction of the clause. This has only been allowed in previous cases when a particular word or phrase is not defined but should have a particular meaning. This is known as the private dictionary principle.
The Court in this case upheld this approach and stated that the wording of the clause was clear and unambiguous. For the defendant’s construction to be enforced, the definition would have to be re-written. There was no scope in this case to use the private dictionary principle so the evidence of negotiations was not admissible. This is despite the fact that the pre-contract material did point favourably towards the defendant’s interpretation.
Parties to a contract should be aware of this strict approach by the court and ensure the terms of their agreement reflect any negotiations which have taken place.
17 March, 2008
Sienna Miller v NGN Limited, Xposure Photo Agency and Warren Richardson
A recent case has brought a new twist on cases concerning paparazzi photographs.
British actress Sienna Miller was on set filming the forthcoming “Hippie, Hippie Shake”. One scene involved her and other actors jumping naked into a lake. Despite considerable security being in place a paparazzo photographer managed to take surreptitious pictures of the naked Miller with a long lense camera.
Those photographs were then sold by photo agency Xposure and published in the News of the World. Miller brought injunction proceedings against the photo agency and the publisher and those claims were settled out of court. However, Miller also brought proceedings against the paparazzo photographer. When the latter failed to acknowledge service of the claim Miller sought judgment in default against him. This was granted, with damages still to be assessed.
As this was a judgment in default the court did not need to consider the extent of the liability of the photographer. Later cases will need to establish whether paparazzi photographers will be held equally liable for the privacy invasion as those who publish their work.
While paparazzi photographers were until now hardly ever joined in privacy actions as defendants, they should not close their eyes to their potential liability. Watch this space for further developments.
Community design right - Defence of innocent infringement not available
J Choo (Jersey) Limited v Towerstone Limited
A recent case highlights that it can be advantageous for businesses to obtain Community design registration on top of registration in the UK.
The proprietor of a registered Community design right for a handbag brought infringement proceedings against the owner of a shop on Oxford Street that sold counterfeit handbags.
The High Court granted summary judgment against the defendant, holding that the defendant’s bags infringed the claimant’s registered and unregistered Community design rights.
The issue then turned on whether the claimant was entitled to damages as the owner of the shop argued to be an innocent infringer. The court noted the anomalous position that while under the UK design right an innocent infringer has a defence to a claim for damages, there is no such defence under the Community design regime. Although there appears to be no policy reason for this, it is indeed the current position. Accordingly, the shop owner was liable for damages.
This case illustrates that businesses should obtain Community design protection in addition to UK registrations at least for their most important designs.
Court fees may contravene human rights
A Polish individual had applied unsuccessfully for an exemption from court fees in Poland in relation to a case he was seeking to bring. The court rejected this as it assessed that he could afford to pay them despite the fees being 22 times the individual’s monthly salary. He subsequently complained to the European Court of Human Rights (ECHR) that this had deprived him of his right, under Article 6 of the Convention on Human Rights, of access to court.
It is an established principle that the amount of fees and the applicant’s ability to pay them are material to establishing whether there the right of access has been enjoyed. The refusal of the exemption had been at the start of the proceedings with the merits of the claim never being examined. The ECHR stated the application should have been allowed to proceed with the court reserving the right to withdraw the exemption at any stage.
The court found that there was a breach of Article 6 as the Polish court had failed to strike the right balance between the interests of the state in collecting court fees and the interests of the individual in pursuing a claim.
10 March, 2008
Professional negligence claims – beware the ticking clock
Tort claims must be brought within six years of the cause of action accruing under The Limitation Act. In negligence claims, the clock starts at the date the damage is suffered. When a couple had agreed to purchase a site on which they wanted to have a house built they instructed solicitors to advise them in the transaction. On 3 April 1998, agreements were entered into with one including a clause that the agreement could be terminated if work had not been completed by 31 August 1998. On 6 August 1998 a letter was written by the couple, allegedly on the advice of their solicitor waiving this right. The couple subsequently suffered a loss.
On 26 August 2004, proceedings were brought against the solicitor alleging that negligent advice had been given on entering into the agreements and relating to the waiving of their rights. They claimed that they only became aware of major problems and the loss they were going to suffer when they received a National House Building Certificate in September 1998.
The Court of Appeal decided that in terms of entering into the agreement any loss suffered arose when that agreement was entered into. Loss resulting from waiving rights under the agreement arose at the time of the waiver as those rights were capable of valuation at the time even though they could not be used until a later date. The claim had therefore expired and could not be pursued by the couple.
3 March, 2008
Family Trust disputes – can the beneficiaries view a letter of wishes
When a trust is created in which the trustees have discretion as to how and when to pay money to the beneficiaries, the creator of the trust will often provide a “letter of wishes”. This is a non-binding communication to the trustees containing requests for them to take certain matters into account when exercising their discretion.
In a recent dispute a family discretionary trust had been created and the settler of the trust had died. There was substantial acrimony over the settlement of the trust so the beneficiaries brought a claim to see the letter of wishes to allow themselves to plan for their financial futures.
It was confirmed by the judge in the case that the trustees’ exercise of their discretionary powers was confidential, with the letter of wishes being a confidential document which trustees could not be demanded to disclose. No reasons had to be given for a refusal to disclose. However, confidentiality could be overridden as a matter of discretion by either the trustees or the court. In each case the trustees must consider what serves the best interests of the beneficiaries and the administration of the trust. In this case, disclosure was granted by the court.
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