Corporate Services Blog

I confess that I am not a pensions expert.  The pension world in general is difficult but with the proposals in respect of the NHS pension scheme for dentists, it is anything but in the words of a meerkat, “simples”.   We have recently posted

Hugh Ellins

a blog by Peter Dunn of Heritage Financial Advisors Limited who has kindly supplied me some more information which deals with various scenarios.  The principal issues appear to arise where there is an element of incorporation or where the dentist being a principal or an associate is working for a corporate.  Even that is not simple on the basis that the situation alters as to whether you are working for a large corporate for example, IDH, or any corporate other than a large corporate.

The purpose of this blog is not to give you a breakdown of the position, as this would suggest an expertise, which I do not possess.  However, I am in the admirable position of being able to refer any questions on these matters to people who know.

You can contact Hugh Ellins on 01793 511055 or hugh.ellins@clmlaw.co.uk

Charles Lucas & Marshall – Legal Services for Dentists.

Thames Valley law firm, Charles Lucas & Marshall’s corporate services team has advised on the UK management buy-out of US business consultancy, RWD Technologies.

Rupert Wright - Corporate Services Specialist

The MBO team has acquired the UK business and set up a new company, CLM Performance Solutions Limited.

The business will provide services related to enterprise learning, organisational strategy and sales force enablement.

Rupert Wright, of Charles Lucas & Marshall, advised on the MBO which involved the transfer of various assets, goodwill, intellectual property and assumed contracts to the new UK business.

RWD is based in Baltimore, Maryland and has offices in Europe and North and South America.

For further information contact Rupert Wright on 01635 521212 or e-mail rwright@clmlaw.co.uk

In a ruling that may have implications for dental associates, the Supreme Court has upheld a decision by an Employment Tribunal that, where contractual terms did not reflect what was actually agreed, one party to the contract was a worker and not self-employed.

Autoclenz, a car valeting firm, inserted new terms into the contract with its valeters entitling them to engage individuals to carry out the valeting on their behalf (in effect, a locum) and also provided that: “You will not be obliged to provide your services on any particular occasion nor does Autoclenz undertake any obligation to engage your services on any particular occasion.”

The contractors brought a case that, despite these clauses, they were “workers” within the meaning of the National Minimum Wage Regulations 1999 (“NMWR”) and of the Working Time Regulations 1998 (“WTR”) and therefore entitled to holiday pay and the minimum wage.

The Supreme Court found (1) the valeters would perform the services defined in the contract for Autoclenz within a reasonable time and in a good and workmanlike manner; (2) that the valeters would be paid for that work; (3) that the valeters were obliged to carry out the work offered to them and Autoclenz undertook to offer work; and (4) that the valeters must personally do the work and could not provide a substitute to do so.

Normally a commercial contract would be definitive in the area of rights and responsibilities, however the Court said “the circumstances in which contracts relating to work or services are concluded are often very different from those in which commercial contracts between parties of equal bargaining power are agreed. This must be taken into account in deciding whether terms of any written agreement in truth represent what was agreed“.

The implication for self-employed associates is that their contracts might fall within the scope of this ruling, in which case the Court would look closely at whether the terms reflected the true intention of the parties. Where it was clear that (despite what was contained in any contract) the associate was not free to substitute a locum, or was not free to accept or decline patients or choose his or her working hours, or work at other premises, or where the principal was expected to provide patients, it may be found that the Associate is, in fact, an employee.

Where an Associate is found to be an employee, the Employer may under certain circumstances be liable for PAYE and NI based on the gross amount paid, going back up to six years, plus up to 100 per cent penalties and interest.

A DPA contract is the best defence against an employment claim and is available only to DPA members.

For further information, please call 01635 521212 or andrew.egan@clmlaw.co.uk

Newbury lawyer, Paul Trincas has been chosen as one of the athletics officials  for the London 2012 Olympic Games.

Paul Trincas

Paul, a partner and head of corporate services at Charles Lucas & Marshall, was short-listed for interview at the end of June and found out today (23 September) he had been selected.

Paul has been selected to be part of the London 2012 Olympic high profile ‘Athletics Team’ and his role will be performed within the main Olympic Stadium.

Among many responsibilities, he will need to ensure the track and field of play is properly prepared, maintained, marshalled and supplied. However, further and more specific details of his role will be notified to him shortly.

“To be perfectly honest, following my interview in June, I had put it to the back of my mind,” said Paul.  “I thought the chances of my being offered a position within the ‘Athletics Team’ in the main Olympic Stadium were not that great given that some 250,000 people had applied to be part of the Olympic Games -  and they needed  less than 200 to be part of the ‘Athletics Team.’

“When I was told by email, I had to read it twice to reassure myself it was true,” added Paul.

“It is a voluntary role and I will need to be available for eleven days of the track and field events. I may also be contacted to officiate at the Paralympics Games which would be a great honour.

“I love athletics and to be part of such a great occasion within the main Olympic Stadium will be the experience of a lifetime.”

Paul, who is a qualified UK Athletics Official and qualified UK Athletics Coach, and who has taken written and practical exams as well as on-going assessments to achieve his qualified status, has been an active member of Newbury Athletics Club for the last ten years.

A schoolboy record holder in sprint hurdles, he now coaches youngsters interested in his favourite athletics event.

Paul will now have to undertake a variety of training and briefing courses in the run up to London 2012, as well as attending various test events to ensure that everything is ready for 2012.

You can contact Paul Trincas on 01635 521212 or paul.trincas@clmsolicitors.co.uk

New Law on Privacy and Cookies

According to a leading legal information provider, in 2010 there were 806 new laws published by the EU which had an impact in the UK.  Peter Billyard, a corporate services lawyer with Charles Lucas & Marshall predicts we can expect a further increase this year.

Several months ago one such EU-derived law came into force which applied to how cookies and other similar technologies are used to store information on computers and mobile devices.

For the uninitiated, cookies are small files used by websites that send information to the browser used by the website visitor which in turn return information to that website. They are typically used to store passwords, to show more relevant content for site users and for tracking browsing habits. Cookies are of benefit to users but are also highly valued by marketers.

The main change introduced by the EC Directive is that a website which uses cookies is now required to:
•    Provide clear and comprehensive information about the purposes of the storage of or access to the data collected; and
•    Obtain a user’s consent if they want to store a cookie on a user’s device.

This change marks a shift in the law to an ‘opt-in’ system.

The law does include an exception to the need to gain a user’s consent. This is when a cookie is ‘strictly necessary’ for a service explicitly requested by a user. An example of this is when a cookie is used to ensure that when a user clicks the ‘proceed to checkout’ button the website has a record of what item the user selected to purchase.

However, such exceptions will be very limited in number and will be, in legal-speak, ‘interpreted narrowly’. In other words it’s not an easy option to avoid complying with the new law.

Currently, many website owners (and users) are already familiar with requesting consent from users to their site’s terms and conditions of business. Indeed some sites have previously referred to the use of cookies in the terms and conditions. It will no longer be possible to do this. To comply with the new rules you will have to refer specifically to the use of cookies and then gain a positive indication that users understand what they are agreeing to and give them a way to show their acceptance.

The Information Commissioners Office, which is responsible for policing the new law, has given website owners until May 2012 to comply. In the meantime it expects website owners to be aware of the change in the law and to be able to show what steps it is taking to conform with the new law.

Website owners should therefore ideally check what cookies are used by their site, how they are used and decide the best way in which they plan to obtain consent from users.

For further information contact Peter Billyard on 01635 521212 or peter.billyard@clmlaw.co.uk

Newbury lawyer, Paul Trincas is aiming to swap the courtroom for the athletics track at the London 2012 Olympics – as he sets his sights on becoming an athletics official  at the Olympic Stadium.

Paul Trincas - Head of Corporate Services

Paul, a partner and head of corporate services at Charles Lucas & Marshall, has applied to become part of the Olympic ‘Athletics Team’ – and has been short-listed for interview later this month (28th June).

If successful, he will be part of an army of an estimated 70,000 people who will be needed for key support roles during the duration of the Games.

“The Olympics in London is a one-off special event that is unlikely to arise again during my lifetime. I felt I would be kicking myself if I didn’t take the opportunity and apply,” says Paul.

“It is not a paid role but I love athletics and to be part of such a great occasion within the main Olympic Stadium is an experience and an opportunity I don’t want to miss out on.”

Paul, who is a qualified UK Athletics Official and who has taken written and practical exams as well as on-going assessments to achieve his qualified status, has been an active member of Newbury Athletics Club for the last ten years.

A schoolboy record holder in sprint hurdles, he now coaches youngsters interested in his favourite athletics event.

If selected, Paul will have to undertake a variety of training and briefing courses in the run up to London 2012 and will need to be available for all eleven days of track and field events.

As well as being a qualified UK Athletics Time-Keeper, he has listed ‘anti-doping’ regulation as an area of interest within his application.

You can contact Paul Trincas on 01635 521212 or paul.trincas@clmsolicitors.co.uk

Thames Valley firm, Charles Lucas & Marshall’s corporate services team recently completed the sale by JMR Ventures Limited of Newbury bar and nightclub, Monty’s to two leisure industry entrepreneurs.

Peter Billyard

Rupert Wright - Corporate Services Specialist

The undisclosed buyers are believed to run a number of other bars and nightclubs in Berkshire and the London area. Plans are in place to update and rename the Newbury venue shortly which will continue to trade in the meantime.

The sale, which was completed in only a little over a week, was led by Charles Lucas & Marshall’s Rupert Wright who was assisted by Peter Billyard.

Rupert Wright said: ‘We were delighted to complete the company sale for our clients on time and within such a short space of time’.

Rupert Wright, a corporate services lawyer with Charles Lucas & Marshall explains why it is important to check out a few house rules before selling or buying a business.

Selling a Business

As the economy emerges from recession, owners of businesses should be giving more thought to possible exit routes for their business and, in the case of buyers, seeing whether they can enhance their existing business by finding suitable opportunities to expand their operations or diversify into new businesses.

For sellers it is imperative they ensure that all key documentation is in place prior to a sale.  Now is a very good time for existing businesses to review all commercial contracts with key customers and suppliers.  Business owners should ensure that all its logos are protected by trade mark.  In particular, protection of brand names and other intellectual property rights should be reviewed.  In the case of incorporated companies, statutory books should be updated and accounts reviewed so that clean accounts can be shown to potential buyers.  Employment contracts should also be updated.

Once a seller has identified a suitable potential buyer, non-disclosure agreements should be considered to ensure that buyers are not embarking on a ‘fishing expedition’ with potential competitors to obtain confidential information.  Heads of agreement will need to be considered with binding provisions relating to exclusivity and confidential information.  The heads of agreement will also set out the key terms agreed.

In the case of a limited company, one fundamental issue to assess from the start is whether the proposed sale is to be a sale of shares or a sale of assets.  If the shares constituting the company are transferred, then the buyer acquires the company and all the underlying assets and liabilities go with it.  By contrast, in an assets acquisition, the individual assets and liabilities to be transferred will need to be identified and agreed.

As a general rule, a seller of a limited company would favour a sale of shares since the buyer would take over all liabilities, hidden or otherwise.  However, a buyer would favour a purchase of assets since there would be a clean break from the business and only identifiable assets will be purchased and the potential historical baggage of the company would not be taken over.  This is not always the case.  Commercial or tax issues are often an important deciding factor, whether the purchase is to be by way of sale of shares or assets.

In summary, at this stage in the business cycle, owners of businesses and potential acquirers should be contacting their corporate legal advisers to ensure, in the case of sellers, that all key contracts are in place and that intellectual property rights are fully protected.  In the case of buyers, specialist corporate lawyers will be required to advise on all aspects of the acquisition and, in particular, to advise whether the purchase should be by way of shares or assets where a limited company is involved.

For further information contact Rupert Wright on 01635 521212 or e-mail rwright@clmlaw.co.uk

Don’t Let Restrictive Covenants Stifle Your Business Start-Up

For further information, please call 01635 521212 or andrew.egan@clmlaw.co.uk

Rupert Wright, a corporate services specialist with law firm, Charles Lucas & Marshall, says company directors need to be aware of their responsibilities and liabilities – should their business get into financial difficulty.

As the economy emerges out of recession, many companies are facing difficult trading conditions. It is therefore important that all directors are aware of their liabilities and take regular legal advice, particularly if a company is on the margin of trading solvently.

While a company is trading solvently, the duties of the directors are owed to the company for the benefit of present and future shareholders.  The directors will be operating on the basis that in making profits for the benefit of the company and its shareholders, there will be sufficient funds generated or available to the company to meet all liabilities to creditors as they fall due.

However, once a company becomes insolvent or there is doubtful solvency, the directors must act in the interests of the company’s creditors in order to minimise the potential loss to them.

The duties of the directors can be divided into common law, statutory and regulatory.

A breach of these duties can lead to personal liability and possible disqualification from being able to act as a director or being involved in the management of the company.  The duties will normally arise when the company is in financial difficulties based on a cashflow or balance sheet test.

Cashflow problems can arise if there are insufficient funds being received by the company to meet its liabilities as they fall due.  The balance sheet test arises if at any time the directors are aware that on a book or market valuation basis, the accounts of the company show that its liabilities exceed its assets.

As soon as the directors become aware of any of these difficulties, they should seek professional advice principally from the company’s lawyers and also possibly from a licensed insolvency practitioner.

The common law duty of directors when a company is on the margin of trading insolvently is to act in the interests of the creditors.

There are also various statutory and regulatory duties.  Fraudulent trading can arise when directors of a company allow it to incur debt when they know there is no good reason for thinking that funds will be available to repay the amount owed.

Apart from the risk of incurring personal liability where a director engages in fraudulent or wrongful trading or has been found guilty of other misconduct, he may also be disqualified by court order.

Various vulnerable transactions also need to be considered, particularly where preference is given to a creditor or a guarantor or surety of the company’s debts.  Any such transaction may be set aside.

In summary, in these testing times, directors should keep in regular contact with their legal advisers in order to avoid personal liability or possible disqualification.

For further information contact Rupert Wright on 01635 521212 or rwright@clmlaw.co.uk