Sherrards to attend the Trusts & Estates Litigation Forum 2024

The event brings together Trust and Estate Litigators from across the globe to network and learn about recent contentious proceedings and updates.

This year, the Trusts & Estates Litigation Forum will take place 4-6th February 2024, and will be hosted in the city of Marrakech, Morocco.

Charles Burrell, Senior Associate and Head of Contentious Trusts and Estates will be in attendance and representing Sherrards.

Charles said “It is a pleasure to be attending the Forum on behalf of the firm. I am excited to connect with fellow professionals and build relationships with my peers across the globe..”

If you are attending the Trust & Estates Litigation Forum and would like to meet with Charles while you are there, please reach out to him on the details below.

Illegal working penalties are set to triple in the New Year

The last increase to the civil penalty was in 2014. From January 2024 , this will be raised up to £45,000 per illegal worker for a first breach (from £15,000), and up to £60,000 for repeat breaches (from £20,000).

We have assisted numerous employers in ensuring compliance. Whether this is in terms of advice on issues surrounding illegal working generally,  or more specific concerns. 

If you have any concerns about your processes, please do not delay.  An audit or health-check could be the key to avoiding non-compliance. 

Please contact Emma peacock on the below details for more information, if required.

Extension to Redundancy Protection

Pregnant employees and those returning from family leave to be given priority status in redundancy situations from April 2024

What does this mean?

From 6 April 2024, employees who are pregnant or returning from maternity, adoption or shared parental leave will all have the right to be offered a suitable alternative vacancy, if one is available, before being made redundant. This gives these employees priority access to redeployment opportunities over other redundant employees.

When does this priority status apply to pregnant women?           

Protection under the new legislation begins when the employer has been notified of pregnancy and 18 months from the child’s date of birth if notified to employer before the end of maternity leave (or 18 months from the Expected Week of Childbirth if not notified).

For women who suffer a miscarriage, the protection ends two weeks after the end of the pregnancy, for pregnancies ending before 24 weeks (as pregnancies ending after 24 weeks are classed as stillbirths and the employee would be entitled to statutory maternity leave).  

What about employees who adopt?

The protection begins at the beginning of adoption leave and ends 18 months from date of placement or date of entry into Great Britain (if overseas adoption).

Is it the same for shared parental leave (SPL)?

A parent needs to take only a minimum of 6 weeks’ consecutive shared parental leave before becoming eligible for 18 months of protection.

How does this affect your business?

You’ll need to bear the above in mind for any restructures taking place after April 2024. There will now be more employees who are potentially going to be given priority status, which may mean you’ll need to carry out a selection process amongst priority status employees at risk of redundancy where there aren’t enough vacancies. Careful consideration will need to be applied here to prevent claims of discrimination.

You may also see a take up of SPL because of the additional protections the employee will benefit from.

It’s important to comply with the law as an employee that isn’t offered a suitable alternative vacancy when they have priority status would have a claim for an automatic unfair dismissal, which would mean a compensatory award that is not capped. There’s also no requirement to have two years’ service to qualify for this type of claim. The employee may also have a claim for discrimination. Given the significant penalties, employers will need to exercise extreme caution and it’s strongly recommended to take legal advice before making redundancies.

 

‘I’m an employee, get me out of here!’

The difficulty for an employer can often be in deciding how to respond and whether to accept the employee’s resignation. Or in some cases, the resignation might be welcome news for the employer, but the employee seeks to retract the resignation, arguing they did so in the heat of the moment.

The general rule is that a resignation from an employee cannot be unilaterally withdrawn without the consent of the employer. If an employee submits a letter of resignation, and a few weeks’ later they realise they have made a mistake, the resignation cannot be retracted unless the employer agrees to it. However, there is an exception to the rule, and that is ‘heat of the moment’ resignations, where it is generally considered that these are not binding on an employee because they may not reflect the true intention of the employee.

The recent case of Omar v Epping Forest District Citizens Advice has provided the Employment Appeal Tribunal (EAT) with an opportunity to clarify the principles that employers should consider if they find themselves dealing with this type of resignation.

So what happened in Omar?

Mr Omar worked for the Epping Forest District Citizens Advice Centre (“Advice Centre”).

  • On 3 February 2020, the CEO of the Advice Centre wrote to Mr Omar about his timekeeping. Mr Omar was unhappy with the letter and verbally resigned to his line manager, Ms Skinner. Ms Skinner told him to calm down and indicated that she would not accept his resignation.
  • On 5 February 2020, Mr Omar became angry again about another matter, and resigned again, this time giving his one month’s notice. Ms Skinner responded by advising Mr Omar to calm down and again said she would not accept this resignation.
  • On 19 February 2020, Mr Omar became angry for a third time, when Ms Skinner queried some holiday dates which Mr Omar believed he had booked. He swore and shouted at Ms Skinner and used words of resignation. In particular, he said he was ‘done with the organisation’ and that Ms Skinner should ‘tell who you need to but I’m off because I’ve had enough’.

Later that day (19th February), the CEO of the Advice Centre had a meeting with Mr Omar and Ms Skinner to discuss what had happened earlier that day. Mr Omar explained his reasons for ‘blowing up’ – he said he was aggrieved about the letter regarding his timekeeping and added ‘I have been working under considerable pressure for some time as I was also helping my father care for my mother who has dementia.’  Mr Omar alleged that the meeting ended with the CEO asking if he and Ms Skinner could continue working together and that the CEO had offered him an alternative role and given him a chance to think about his position.

However, the Advice Centre argued that the purpose of this meeting was to ensure Mr Omar did not leave his employment on bad terms and that at the end of the meeting, the CEO had asked Mr Omar and Ms Skinner to go away and think about how they could continue working together over Mr Omar’s 1 month notice period. It denied having offered Mr Omar an alternative role and said that Mr Omar did not attempt to retract his resignation.

On 21 February 2020 (his next working day), Mr Omar met with the CEO again. She told him that Ms Skinner had confirmed that she could no longer work with him and that his resignation would stand. The Advice Centre’s case was that Mr Omar said in response that he could not work with Ms Skinner either and that therefore his resignation still stood. It was accepted by Mr Omar that at the end of this meeting, he agreed to the CEO’s requests to put his resignation in writing.

However, Mr Omar did not do that.

Instead, on 23 February 2020 he sent an email to the CEO, stating ‘my understanding is that as a result of my behaviour [Ms Skinner] now wants to accept my resignation as she will be unable/unwilling to work with my going forward, which I understand. However, I wish to retract my resignation as it was a “heat of the moment” resignation’. Mr Omar went on to suggest that the Advice Centre allocate him to a different office.

The Advice Centre refused to accept the retraction of his resignation and treated his employment as terminating on one month’s notice running from 19 February 2020.

Mr Omar claimed he had been unfairly dismissed.

What did the Employment Tribunal find?

The Employment Tribunal concluded that Mr Omar had resigned, and that as a result, there was no dismissal by the Advice Centre. Therefore, in the absence of a dismissal, his claim for unfair dismissal failed. Mr Omar appealed to the EAT.

The EAT Decision

The EAT found that the Tribunal’s decision was ‘substantially flawed’ and that it had not applied the correct legal principles to the case, and that the case would therefore be remitted to a fresh Tribunal to conduct a full rehearing. This means the claim for unfair dismissal will be reheard, and possibly a different outcome will be reached.

The EAT did however use the case as an opportunity to set out guidelines that an employer should consider when dealing with resignations:-

  • Words of resignation used by the employee must be construed objectively – consideration must be given to whether, objectively speaking, it would have appeared to the reasonable bystander that the employee really intended to resign.
  • What the employer subjectively understood the employee’s words to mean is relevant, but it is not definitive.
  • Importantly, the subjective intention of the employee is not relevant (i.e. what was going through their head when they communicated the words of resignation) – the key is what was actually said by the employee.
  • It must be apparent that the employee genuinely intended to resign and that they were in their right mind at the time – if an employee is highly emotional then this could lead to a suggestion that their words were not genuinely intended.
  • The types of circumstances that might suggest a resignation was not really intended include where the employee is angry and overhasty, is behaving out of character, has a relevant mental impairment, is immature, or is under extreme pressure from another party.
  • Aswell as the precise words used by the employee at the time of the resignation, any evidence about what happened after the resignation may also help in judging whether a resignation was really intended at the time. For example, the evidence may suggest the resignation was really intended, but that the employee had simply had a change of heart afterwards, in which case the resignation will still stand.
  • The same rules apply to written notices of resignation as to oral ones. However, a written notice will usually indicate to an employer a certain degree of thought and care, which will make it less likely that the employee did not intend to resign.

 

So, what are some useful hints and tips for employers to consider when dealing with heat of the moment resignations…..

Where an employee resigns in an obviously composed and measured manner, it will usually be much less risky for the employer to take the resignation at face value. However, where an employee is visibly upset, angry, stressed, or emotional and impulsively verbalises words of resignation in a pressured or stressful situation, employers should not assume the resignation is valid. Instead, it is good practice to take a step back and assess the situation, consider the exact words used by the employee, alongside the EAT’s guidelines, and decide whether it is reasonable to accept the resignation in all the circumstances.

It would be advisable for managers to take an accurate written note of the exchanges between the employer and employee and to formally record what they understood the employee’s exact words to mean. Any meetings to discuss the resignation should be documented.

It may also be appropriate, to mitigate any risks, to offer the employee an opportunity to take some time out to reflect on the situation. If on reflection they do still wish to resign, employers should ask that they confirm this in writing by giving their formal notice.

These types of situations are undoubtedly a tricky area for employers and no two ‘heat of the moment’ resignations are the same. You, as the employer, have to tread carefully, as if you were navigating through a jungle (see what we did there!). If you have any questions about the effect of this decision, or would like any employment advice more generally, please do not hesitate to get in touch with our Employment team who will be happy to assist.

Sherrards accepted as a member of the UK Investment Support Directory

Sherrards has recently had confirmation from the Department for Business and Trade that we have been accepted as a member of its UK Investment Support Directory.

The UK Investment Support Directory is a collection of companies that have skills and experience in helping overseas businesses set up or expand in the UK.  It is an online tool which helps international investors find advisors in the UK, and is hosted website and is often used by British  embassies and consulates across the world as a starting point by way for an introduction to English law firms among other professionals.

https://www.great.gov.uk/international/investment-support-directory/OC352466/sherrards-solicitors-llp/?verbose=true

Sherrards’ International Connectivity

Paul Marmor, Sherrards’ head of international services, comments: “ The UK is an outstanding  place with so many reasons to invest  here.  I am proud to say that Sherrards can provide  businesses setting up and or making investments in the UK, or individuals making lifestyle moves  to the UK, with the professional and legal support they need.  Our international connectivity both UK  inbound and outbound  is second to none. That’s through our continued relationship with the Department for Business and Trade via the investment support directory, as well as  our involvement in organisations such as the International Bar Association, The American bar Association  and the Alliott Global Alliance. Indeed, our international relationships continue to be at the heart of our practice’s footprint.”

Why invest in the UK?

The UK offers a first-class environment to reliably expand, trade and invest, as promoted by the Department for Business and Trade, given that the UK has a mature, high-spending consumer market and an open, liberal economy, world-class talent and a business-friendly regulatory environment.  The UK’s language, legal system, funding environment and time-zone, and lack of red tape, helps make the UK one of the easiest markets to set-up, scale and grow a business.

 www.great.gov.uk/international/content/investment/why-invest-in-the-uk/

For more information on our international offering contact Paul Marmor on pdm@sherrards.com and Sophie Hudson on sophie.hudson@sherrards.com

Click on the image below to head to the Department for Business and Trade’s website, and to see the Sherrards profile within:

department for Business and Trade

Building the law firm of the future

This first Class Panel at the The Law Society London, UK, was focused on best practice for attracting & retaining talent in the legal profession across the globe. Over 150 attendees from around the globe were in attendance.

The impressive panel included a keynote session from David Gauke, Head of Public Policy at Macfarlanes, speaking from his perspective as former Minister of Justice & Lord Chancellor, David focused on the next generation and a desire to protect the rule of law, among many other points.

Paul was also joined by Claire Sanders of Being Human, who explored best ways to harness the younger generation.

Paulo Rocha, Managing Partner of leading Brazilian law firm Demarest Advogados, confirmed that talent-related issues are the same globally.

Lisa Göransson, head of the Nordic desk at Allen & Overy, and also IBA officer from the Women’s Committee, focused on the need to focus on women in the profession.

Paul Marmor comments: “We set out a range of points and thoughts on how to attract and retain talent into the legal profession which is an area of focus for the IBA and, indeed, for Sherrards which is at the heart of much of our thinking as a legal profession especially through our Sherrards Training Academy.”

The Powers of Attorney Act 2023

As part of The Sherrards Training Academy, we have asked our Legal Assistants and Trainee Solicitors to write articles to support their learning, and also to ensure they start to build on their own personal brand. This article has been fact-checked and proofread by Head of the Private Wealth department, Nicole Marmor.

Introduction:

In the realm of estate planning, Lasting Powers of Attorney (LPAs) hold equal significance to Wills as tools by which individuals can safeguard their autonomy and ensure their wishes are honoured.

The Powers of Attorney Act 2023 received Royal Assent on 18 October 2023 and signifies a milestone in the law surrounding LPAs. The legislation is poised to take effect in early 2024 and will usher in substantial changes to how LPAs are registered and safeguarded.

The Act comes in response to concerns surrounding complexities and inefficiencies permeating the current LPA system and aims to promote accessibility by enabling online registration.

What is a Lasting Power of Attorney?

An LPA is a legally binding document enabling the donor to designate a trusted person (or persons) as their legal representative. The attorney is authorised to act on the individual’s behalf in situations where they are unable to do so.

There are two types of LPAs, one pertaining to financial matters and the other to health and well-being. Many choose to have both in place. Both documents need to be registered in order for the attorney(s) to act. By registering a power of attorney, you ensure that you retain control over how your affairs are managed in the future, irrespective of your personal circumstances.

How will the Powers of Attorney Act change the current landscape?

The Act’s primary objective is to streamline the LPA process, making it more convenient whilst reducing the clerical errors traditionally associated with wet ink LPAs. LPAs will be able to be created and registered online which will (hopefully) significantly reduce the processing time.

Nevertheless, it’s not all ‘laissez-faire’ when it comes to the Powers of Attorney Act, considerable safeguards have been put in place with the aim of shielding vulnerable donors from potential fraud and abuse, attorneys are now being required to provide more comprehensive information regarding their relationship with the donor. Furthermore, to ensure compliance with these new measures the Office of the Public Guardian (OPG) has been granted increased authority to assess and challenge LPAs and a new criminal offense of LPA fraud has been introduced to fortify the measures.

Forecast for the future:

Cloudy with a chance of LPAs …

It is anticipated that there will be a surge in the number of people wishing to register an LPA due to the convenience of the digital registration process. Private Wealth solicitors are poised to play a pivotal role in facilitating this process, offering guidance on the recent amendments and potentially undertaking reviews of existing LPAs to ensure compliance with evolving legal standards.

The OPG is expected to provide online training specifically tailored to acquaint legal professionals with the new digital LPA registration process. Solicitors may consider integrating online resources and video conferencing services to streamline access to their LPA-related advice, adapting to the changing legal landscape to benefit their clients.

Sherrards and The Legal 500 2024

What is the Legal 500?

For 33 years the Legal 500 has been an influential and widely reconsidered legal directory that provides ranking and reviews of law firms and individual lawyers. The rankings are based on client feedback, submissions from law firms, interviews, and extensive research by experienced legal market analysts.

Why is The Legal 500 important?

The Legal 500 rankings can help to build the reputation of lawyers, law firms, and the work they have done to support their clients over the past year. This helps us as a Firm to highlight our lawyers’ expertise and also helps us to communicate the type of work we do in general.

As an internal communications exercise, it helps us to retain our talent and to attract lawyers and business professionals who want to work for a ‘top tier’ Firm – in other words, a Firm that is exceptionally good at what it does!

Each year, we ask clients and contacts to act as ‘referees’ for us. They kindly take a call from a researcher to help us to rank in this directory. Our ranking is truly down to them and their time, so we thank them profusely.   

An overview of how we did:

The Dispute Resolution Department have kept their top tier status and are praised for their “serious, rigorous, but inventive approach”. A client said “The team is highly responsive and demonstrates high levels of knowledge that bring about the right result in complicated matters.”

Practice Head and Partner Paul Marmor has been recognised as a Leading Individual once more with clients noting his extensive experience in international banking and finance disputes. Paul “combines the rigour of a classic commercial litigator with ingenuity and adaptability when faced with novel problems. He is also a delight to work with.”

Barney Laurence, Partner and Head of Recruitment Law has been recognised as a Next Generation Partner who ‘frequently appears before the High Court and the Commercial Court in restraint of trade injunctions within the franchising sector.’ He is “excellent, extremely professional and able to easily explain complex legal concepts in a straightforward manner.” Greg Pooler, Legal Director is “very hard working and bright, a capable pair of hands, and someone to watch.”

Partner Karen Dobson is recommended for her contentious insolvency work and the ‘excellent and creative’ Marta Grieve is mentioned for her matters relating to the CIS and Eastern Europe regions.

 

The Private Wealth Team has also maintained their top tier status with Charles, Louise and Nicole all mentioned and recommended for their expertise. A client testimonial was “They are fully interested and engaged in not only finding us the best outcome but also guiding through timings and process. We felt that we had someone on our side that was both batting for us as well as thinking ahead of the game to influence the future outcomes.”

Charles stands out for his wide knowledge, and enthusiasm to search for options.” Clients says working with him is like they have welcomed a great team member.

 

The Employment Team remain top tier with clients calling the team ‘exceptional individuals’. Partner and Head of Employment, Mark Fellows has once again been recognised as a Leading Individual which is a great accolade to Mark’s knowledge, expertise and genuine relationships with his clients.

Mark is noted for advising owner-managed businesses and global companies within the pharmaceuticals and retail sectors, and his work within Employment Tribunals while Emma O’Meara has been recommended as a great lawyer with clients stating how she is always accessible and always goes above and beyond.

On the whole team, a client said:  I’ve found this practice to be very down-to-earth and professional. At every stage, they have been accommodating. I’ve had total confidence in the team from the start, due to first-class communication and relevant advice.”’

 

The Sherrards Corporate and Commercial team also ranked highly. Jean-Paul da Costa and Leigh Head both received high recommendations for their ‘wealth of experience’ in advising owner-managed businesses, and clients in the entertainment and hospitality sectors. Clients said: “The Sherrards team are down to earth, pragmatic and focused on getting the deal done. They are professional yet approachable, and I very much enjoy working with them.”

Another client said that “They are known for ‘never overcomplicating what they do or how they describe what they have done’.

A recent case study mentioned was the team advising Gift Universe on targeted company acquisitions as part of a wider strategic restructure of the group, and the establishment of an employee ownership trust.

 

The Commercial Property teams in both London and St Albans did well too, with Stephanie Kierans again receiving the Next Generation Partner recognition and Terry Fendt (Practice head), Shane Knight and Guy Morgan recommended for their expertise. The researchers note their demonstratable experience in the hospitality, leisure, retail and charity sectors. Clients said they are “An approachable team, with impressive experience.” and another said they are “professional, helpful and patient.”

On Shane Knight, a client said: “From 30 years of experience in real estate trading, we have never seen such a unique individual, who is so considerate, attentive and responsive.”

 

Although we could go on, that’s a good place to leave our update.

Well done to each of our teams and their continued hard work. But most importantly, thank you to our clients and contacts who helped us rank highly for another year running. Not only does this help boost morale, but it is important for attracting and retaining talent to the Firm, and the odd client too.

 

To read the full Legal 500 ranking, click here. 

Chris Hovington on Sherrards: Client Testimonial Video

We asked Chris Hovington, Group Leasing Manager at Praxis Real Estate Management to sit down with us and talk about working alongside the teams at Sherrards.

Thanks to Chris for taking the time to speak about our Commercial Property teams whom he has worked with for over twenty years.

He says, “We work with Sherrards as often as we can.”

We say “The feeling is mutual!”

Break Clauses: Balancing Business Aspirations and Tenant Rights

Erin, a trainee solicitor in our Dispute Resolution team, explores the recent judgment in BMW (UK) Ltd v K Group Holdings Ltd highlighting the balancing act required in respect of a landlord’s business aspirations and a commercial tenant’s rights when negotiating break clauses in a lease.

Introduction

The realm of commercial leases is a complex landscape governed by legal provisions aimed at balancing the interests of both landlords and tenants.

One such provision that plays a pivotal role in commercial lease agreements is the break clause.

Break clauses in a commercial lease are provisions that allow either the tenant or the landlord to terminate the lease before its designated end date. These clauses offer flexibility within the lease agreement, allowing parties to adapt to changing circumstances or business needs.

However, a recent decision in the County Court highlighted the difficulties that landlords can face when seeking a break clause for their business needs in a renewal lease protected by Part II of the Landlord and Tenant Act 1954 (the Act).

BMW (UK) Ltd v K Group Holdings Ltd

The case concerned a car showroom in Mayfair, demised under four separate leases from the landlord, K Group Holdings Limited, to the tenant, BMW (UK) Limited.

These leases were subject to renewal proceedings under the Act and therefore, were to be granted on essentially the same terms as the previous leases.

The previous leases did not, however, contain a landlord break option. Accordingly, the onus was on the landlord to demonstrate the proposed terms were fair and reasonable and should be granted. 

If a break clause was to be included, the landlord accepted that it would have to prove a ground of opposition under s30(1) of the Act in order to exercise the break option.

HHJ Monty KC, in considering whether to grant a break clause, made it clear that the court must try and strike a balance “between granting a reasonable degree of security to the tenant on the one hand, and not preventing the landlord from recovering possession if one of the statutory grounds can be proved on the other”.

Section 30(1)(g) – Landlord’s intention to occupy the premises for the purpose of a business to be carried on by the landlord

The relevant ground in this case was ground (g), namely that on termination of the tenancy, the landlord intends to occupy the property for the purposes of a business to be carried on by the landlord.

The renewal leases themselves were unopposed and so it was for the landlord to prove that they would be able to establish ground (g) at some point in the future when exercising the break option. That is, the landlord needed to show a bona fide intention to operate the break clause if one was granted.

When giving evidence, the landlord agreed that a car business would be an entirely new business for K Group Holdings Ltd. It was further contended by the landlord’s witness that members of his family who controlled entities within the same group as the landlord were only a “little bit inclined to have a study and see the possibilities” of the electric car market. 

In this case, the landlord’s inadequate evidence and the effect the break clause would have on the tenant meant that the court found in favour of the tenant in refusing the inclusion of the landlord’s proposed break clause.

Practical considerations

This decision highlights the raising of the bar in respect of the landlord’s intention to exercise a break option, particularly where the landlord may have aspirations to start a new business venture or expand an existing one.

A landlord should ensure they can evidence a real intention that the operation of the break clause is more than a vague possibility. Therefore, evidence of any steps taken to progress the possibility of occupation for the purpose of a business would be worth documenting.

Although a complete and comprehensive business plan may not be required, the landlord should seek to substantiate any request for a break clause with supporting evidence detailing any “genuine and workable” intention to occupy the premises.

Sherrards’ Real Estate Litigation team

This article has been fact-checked and authorised by the Head of the Real Estate Litigation team, and Training Partner Michael Lewis. If you have any questions or thoughts, please reach out to him by clicking here.

Our Real Estate Litigation team can support you with an entrepreneurial, commercial and considered approach to break options to help you achieve your goals. Our specialist team can advise you on your options, including, where appropriate asking the court to determine the matter.

For advice and assistance, contact the Real Estate Litigation team at Sherrards.