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You and the law

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Current articles Autumn 2008

Property market needs action

The Government’s recent move to waive the 1% stamp duty for properties under £175,000 may be a huge benefit for some first-time buyers but it didn’t go far enough to re-energise the housing market, says David Knapp.

Stamp duty should have been abolished up to £350,000, to really get the market moving again.

Other measures that the Government introduced were predominantly directed at the new build market. One wonders if this is merely aimed at preventing developers from going to the wall, as they are vitally important to the Government’s need for more housing to be constructed. Meanwhile, those frustrated sellers in the majority of the market – some of whom are under severe financial pressure – have been left on their own and without any help.

The number of repossessions is significantly increasing. Also, there are now fewer people purchasing properties on a buy-to-let basis, partly due to the mortgage companies' reluctance to provide any form of loans.

The positive side for buy-to-let owners is that those people who currently have properties and are renting them out, and who do not need to sell, are obtaining a higher yield in rental terms.

There could be a further problem in the early part of 2009 when the indices from the Halifax and the Nationwide are issued. When the stable period of 2007 is taken out of the figures we could see a jump from somewhere in the region of 12% to 25%. This will panic more buyers into staying put.

We need a stable market, whether it be at the top of the market or at the bottom but this is unlikely ever to occur.

So, as soon as mortgage funds become more readily available and this current credit crunch passes (which is not likely to be for around 18 months), there will be a huge number of pent-up buyers who will come back into the market to fuel the next price rise! Until then, we ride the storm.

For the full article click here or for further information contact David Knapp on 01483 887766.

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A question of Nil rate banding (IHT)

Q: I believe the nil rate band for Inheritance Tax is now £624,000 – is that right?

A: I’m afraid that is not right and it appears that there are some misunderstandings about the Chancellor’s changes to Inheritance Tax for married couples, now included in the Finance Act 2008.

The changes do not simply double the nil rate band (“NRB”). The Chancellor provided that NRBs were transferrable between spouses as long as the circumstances and the paperwork are correct. It is possible that no inheritance tax will be payable on the death of a surviving spouse unless it exceeds twice the NRB at that date.

Where the NRB on the first death is unused, such unused proportion can be carried forward and added to the NRB of the surviving spouse (subject to certain limited exceptions). However, HM Revenue and Customs has laid down strict requirements for the documents and information that will be required if the transferrable NRB is to be claimed successfully.

It is important to review your wills to see if the changes will affect you. You might also wish to consider the paperwork that will be required for a successful claim.

For further information contact Alyson Coulson on 01483 887766.

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Captured by the enemy?

If you have been involved in an accident one of your first ports of call is to contact your insurance company. But what if you have been injured as a result of somebody else’s negligence and their insurance company contacts you first?

Some insurance companies are now engaging in what is being called “third party capture”, where they contact people who may have claims against them, before they have had a chance to take their own independent legal advice.

There are even parts of the insurance industry saying that you could recover more compensation if you are not represented by solicitors, although there is a mass of evidence to contradict this.

In a recent case following an accident at work, an employer’s insurance company offered £25,000 in final settlement, saying that the claimant didn’t need to use a solicitor as he could only make a claim for loss of earnings but not for his injuries. That ‘advice’ was completely inaccurate.

Although subsequent offers were made by this insurance company for £30,000 and then £35,000, the injured person decided to appoint his own solicitor and, at the time of writing, the value of the claim is likely to be 10 times the amount of the original offer.

When it comes to any party who has to pay out a settlement, their main aim will be to pay as little as possible; their advice will be at best minimal and, at worst, questionable. There is a clear conflict of interest.

Beware of “friendly” insurance companies or agents who say they can assist you in obtaining proper compensation and that there is no need to instruct your own solicitor to help. Do not add insult to injury by ‘doing it yourself’ and risk undersettling your claim because there are usually no second chances. A full and final settlement is just that!

For further information see the full article or contact Marek Bednarczyk on 01483 887766.

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What price a life?


According to Dr Caroline Kerr, Solicitor in the Personal Injury Department at our Guildford offices, the price of a life is just £11,800 payable for a ‘bereavement’ under the Fatal Accidents Act.
Mean though this may seem, prior to 1982 no damages at all were awarded for bereavement in a fatal accident claim.

This figure can only be claimed by the spouse or civil partner of a deceased adult or, if the deceased was under the age of 18 and neither married nor in a registered civil partnership, by their parents.
However it is also possible to recover:

In tragic and emotionally-charged situations, there is a danger that the calculation of these claims can turn into a cold mathematical exercise.

To compensate for the insultingly low level of the bereavement award it is important to have a specialist to maximise the other parts of the claim – particularly where whatever sum is awarded or agreed will be a once and for all figure.

For further information contact Dr Caroline Kerr or Marek Bednarczyk on 01483 887766.

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Review and register a Will

Hart Brown is pleased to offer two new services.

Will Review Service
Making a will is an important step but keeping it up to date is also crucial.

Shaun Parry-Jones says, “Hart Brown is pleased to offer a Will Review Service. It includes updates on changes in the law that may affect your will plus an annual Will Health Check where we let you know whether it appears to be out of date, due to either changes in your circumstances or regulations.”

This service aims to save you time by not having to address the implications of Budget speeches, case reports etc. yourself. It also gives you peace of mind by reminding you to keep your will and estate planning arrangements under review. The facility is designed to make the process as easy as possible; we have even arranged for the annual fee, from £75 + VAT for a single will, to be dealt with by direct debit.

Where is the will?
Hart Brown has become a founder member of Certainty, the UK’s first fully electronic online register of wills.

This is particularly significant when you consider that somewhere in the region of 67% of people in the UK do not know where their parents’ wills are!

A recent survey has shown that due to the passage of time, house moves, new relationships or a new will, tracking down the last will has become more difficult.

In 1998 the Law Society Gazette highlighted the need for a central wills register.

The Certainty register has been backed by Kevin Martin, who was the Law Society’s President in 2005/06.

A will can be registered with Certainty if it has been made with a solicitor. If you make a will with Hart Brown, we would be pleased to assist you with registering your will with Certainty – the process carries a small fee.

For further information please contact Shaun Parry-Jones on 01483 887766.

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Redundancy or unfair dismissal?

Employers often use the term ‘redundancy’ when an employee is, in fact, being unfairly dismissed.

A genuine redundancy situation is where there is a workplace closure, a business closure or a reduction in the requirement for employees to do work of a particular type.

If your employer is recruiting other people, you are the only person being made redundant, or you are one of only a few employees being made redundant in a large company, this may indicate that you are being dismissed for a reason other than genuine redundancy. This could give rise to a claim for unfair dismissal.

Following a fair procedure
Your employer must follow a fair procedure (or, for 20 or more redundancies, a statutory consultation process), or you may be entitled to bring a claim for unfair dismissal in the Employment Tribunal.

Where a number of employees have the same or similar positions the employer should pool these employees together and apply fair, objective and non-discriminatory selection criteria in order to decide who is to be made redundant.

Your employer should:

The statutory dismissal procedure should also be followed to allow you to state your case. At the dismissal meeting you have a right to be accompanied by a fellow employee or trade union representative. You will also have the right to appeal any decision to dismiss. If your employer does not comply with the statutory dismissal procedure, your dismissal may be automatically unfair and a Tribunal must award an increase in any compensation awarded of between 10% – 50%.

Statutory redundancy payment
Generally, you will be entitled to a statutory redundancy payment if you have worked for your employer for at least two years. How much depends on your age, your weekly pay (capped at £330.00) and how long you have worked for the company.

You can lose the right to a statutory redundancy payment if you reject a suitable alternative job. However, you can work a four-week trial period without losing the right to a statutory redundancy payment.

You will also be entitled to notice (or a payment in lieu) and any accrued and outstanding holiday pay.

If you have two years’ service and are given notice, you will have the right to take a reasonable amount of time off with pay to seek alternative work.

Claiming unfair dismissal
If you feel that you have been unfairly dismissed you should appeal the decision. If, following the appeal, you still think that you have been dismissed unfairly, you may wish to consider bringing your claim to an Employment Tribunal where you will generally need to have one year’s service with the company. Usually, unfair dismissal claims must be brought within three months of the date of dismissal so it is important to act promptly.

The maximum compensatory award that can be awarded for a claim is currently capped at £63,000. The vast majority of claims to the Employment Tribunal settle – usually by a negotiated settlement – saving both parties time and costs.

If you think that you may be being made redundant unfairly or that incorrect payments have been made, please contact Gerrard Gibbs or Ursula Martiniussen on 01483 887766.

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Divorce and reality

National figures published on 28 August 2008 by the Office for National Statistics show that divorce rates are at their lowest since 1981 – and analysts say this is because of the current economic climate.

Property group Savills points to falling house prices making divorce less affordable. They add that the average age of splitting couples is getting older so more equity is involved in divorce cases.

Sharon Powell, Family solicitor at Hart Brown says, “The cost of divorce can be high, but this is usually where the case has had to be resolved in Court. At Hart Brown, we encourage our clients to consider the collaborative law route, which involves both parties and their lawyers meeting together to find solutions and resolve issues between them. This avoids contested Court proceedings and we find that this approach proves very successful.”

Of course, more couples are now choosing to cohabit rather than marry and the breakdown of a cohabitation relationship can result in complex financial issues.

Hart Brown’s collaborative lawyers and its team of approachable family lawyers are highly experienced in dealing with both divorce and cohabitation issues.

For further information contact Sharon Powell on 01483 887766.

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Fit for Squash... Fit for Business!

Hart Brown is once again delighted to be organising the Guildford Business Squash League. The league is going into its 4th season and is an initiative of Peter McGinty, General Manager of Hart Brown solicitors, and Ian Robinson, Director of Squash at Surrey University.

Peter said, “The concept of playing sport and networking is not new but this format seems to have created a buzz in the local business community. We started with six teams and each year the numbers have grown. This year we are hoping to attract 20 teams to the league.”

The teams are made up from some of the larger businesses in the area. Philips Electronics, Baker Tilly, Roffe Swayne, PKF and Hart Brown have made the league competitive and have created great networking opportunities for everyone.

Last year England Squash joined and have started to give free coaching sessions to league players, which are proving very popular. The players have been having coaching throughout the summer months in readiness for the first match of the new season on 30 September.

Last season, winners of Division 1 were Surrey University and PKF came top in Division 2.

Matches are played on the last Tuesday of the month from 12-1pm, followed by a networking buffet lunch from 1-2pm. The finals are played on the last Tuesday in March. Teams consist of three players.

For further details on joining the Guildford Business Squash League, please contact Peter McGinty or Debra Tester on 01483 887766.

 

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An Evening at the Salerooms

Hart Brown is holding a joint seminar on Maximising Assets with Dreweatts Auctioneers and Valuers at its Godalming Salerooms on the evening of 16 October. To book contact Louise Windless on 01483 887766.

Appointments

Anne Thomas – Family Department
Anna Reed – Commercial Business department
Virginia Cook – Marketing department
Sue Pape – Trust & Investment department
Sonia Dhesi – Trust & Investment department
Sara Gale – Trust & Investment department
Julian Waldon – Family department – joins mid October

Investment Workshop

Hart Brown is running an evening workshop for private clients on 6 November looking at investing in the current economic climate, including the property market. For further details contact Virginia Cook on 01483 887766.

In Brief

Welcome to this issue and I hope you have enjoyed a pleasant summer, despite the weather!

We at Hart Brown have had a busy and exciting six months. As well as organizing our highly successful fourth annual Economic Forum in June, we opened offices in Wimbledon Village, South West London, in April. This was a natural progression for Hart Brown, as we already had many clients in the area and along the ‘A3 corridor’ and we are now centrally located for them. The team in Wimbledon is able to offer a wide range of excellent services for our clients and we are also refurbishing the Wimbledon offices later this year to enhance facilities and services still further. Further information about our services, events and news can be found at www.hartbrown.co.uk
If you would like to receive this newsletter by email please let Virginia Cook know.

Bettina Brueggemann – Managing Partner

 

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