Corporate veil

November 1st, 2017 by James Goudie KC in Capital Finance and Companies

In Persad v Anirudh Singh [2017] UKPC 32 Lord Neuberger reaffirmed, at paragraph 17, that piercing the veil of incorporation is justified only “in very rare circumstances”.  It can be justified only where a person is under an existing legal obligation or liability or subject to an existing legal restriction which he deliberately evades or whose enforcement he deliberately frustrates by interposing a company under his control, as made clear by the Supreme Court in VTB Capital v Nutritek [2013] 2 AC 337 and Prest v Petrodel [2013] 2 AC 415.  Lord Neuberger further reaffirmed, at paragraph 20, that the fact that a company is a “one man company” is irrelevant: Salomon v Salomon [1897] AC 22.  It is a fallacy to suppose that the Court can pierce the corporate veil where the purpose of interposing a company into a transaction is to enable the owner or controller of the company to avoid liability.  Lord Neuberger said, at paragraph 21, that use of terms such as “front” or “alias” can too easily be invoked to justify a wrong decision.  The company has a distinct legal personality. As Lord Neuberger observed, at paragraph 22, cases such as Gilford Motor Co v Horne [1933] Ch 95 and Jones v Lipman [1962] 1 WLR 832 were distinguishable.

Not only did the person who set up the company in those cases have an existing relevant legal obligation which he was trying to avoid by entering into a transaction involving the company, but also the involvement of the company was unilaterally effected by the person concerned, without the knowledge, let alone the consent, of the other party.

 

Remedy for breach

November 1st, 2017 by James Goudie KC in Decision making and Contracts

In Case E-16/16, Fosen-Linjen AS v AtB AS, the EFTA Court has said, in a Judgment on 31 October 2017, that damages are available as a remedy for breach of the procurement rules where there is a sufficient causal link between the breach and the damage irrespective of the gravity of the breach.  A simple breach of procurement law is in itself says the Court sufficient to trigger the liability of the contracting authority to compensate for damage incurred: paragraph 82.  This contrasts with the Supreme Court Judgement in Energy Solutions v NDA (2017) UKSC 34.

 

Award of contracts

November 1st, 2017 by James Goudie KC in Decision making and Contracts

R (Hersi & Co) v Lord Chancellor (2017) EWHC 2667 (TCC) is concerned with the defendant’s conduct of a public procurement exercise for the award of contracts to provide publicly-funded legal services relating to immigration and asylum and mental health work.

As part of the tender, there were 7 particular questions, grouped under the heading ‘Selection Criteria’, which all applicants were required to answer. The claimant answered the first three, but then left blank the answers to Questions 4, 5, 6 and 7. In consequence, the defendant awarded the claimant no points for its answers to those questions and the claimant’s tender failed to gain the required points to justify the award of a contract. The claimant now argues, either that the defendant should have sought clarification of their non-answers, and/or that the answers to the questions were plain from other parts of the claimant’s tender and should have been scored accordingly. In addition, the claimant has a wider case in which it seeks to compare the defendant’s treatment of numerous other applicants on other aspects of their tenders, so as to allege inequality of treatment. Read more »

 

Planning obligations

October 27th, 2017 by James Goudie KC in Planning and Environmental

Aberdeen City and Shire Strategic Development Planning Authority v Elsick Development Company Limited (2017) UKSC 66 raised an important question of planning law. A planning authority foresees and plans for significant growth in its area. Major investment in transport infrastructure is required to accommodate the aggregate of the planned development. The planning authority seeks to achieve this investment by adopting a policy in its development plan which in substance requires developers to enter into planning obligations with it to make financial contributions to the pooled fund to be spent on the infrastructure, including interventions at places where a particular development has only a trivial impact. Is such a policy within the existing powers of the planning authority under current planning legislation? Read more »

 

Homelessness

October 20th, 2017 by James Goudie KC in Housing

In Hotak v Southwark LBC (2016) AC 811 the Supreme Court ruled that “vulnerable” for priority need purposes connotes “significantly” more vulnerable than ordinarily vulnerable as a result of being rendered homeless.  But what is meant by “significantly” in this context?  The Court of Appeal has attempted to answer that question in joint appeals Panayiotou v Walsham Forest LBC and Smith v Haringey LBC, (2017) EWCA Civ 1624.  It means “at risk of more harm in a significant way”. That is an evaluative judgment in relation to any given set of facts: paragraph 64. Read more »

 

Abuse by foster parents

October 19th, 2017 by James Goudie KC in Social Care

In Armes v Nottinghamshire County Council (2017) UKSC 60 the appellant was in the care of the respondent local authority from the ages of seven to eighteen. The local authority placed her into foster care with Mr and Mrs A between March 1985 and March 1986, and with Mr and Mrs B between October 1987 and February 1988. She was physically and emotionally abused by Mrs A, and sexually abused by Mr B. The case proceeded on the basis that the local authority were not negligent in the selection or supervision of the foster parents, but the appellant claimed that the local authority were liable for the abuse, either on the basis that they were in breach of a non-delegable duty, or on the basis that they were vicariously liable for the wrongdoing of the foster parents. Her claim was dismissed by the High Court and the Court of Appeal. Read more »

 

Direct Action: Natural Justice

October 12th, 2017 by James Goudie KC in Planning and Environmental

A local planning authority has power to take direct action. This is pursuant to Section 178 of the Town and Country Planning Act 1990 (“the TCPA”).  That empowers the LPA to enter land and take the steps required by an enforcement notice once the period for compliance with the notice has expired. Read more »

 

Direct Effect of EU Directives

October 11th, 2017 by James Goudie KC in Judicial Control, Liability and Litigation

In Farrell v Minister for the Environment, Ireland, Case C-413/15, ECJ Judgment on 10 October 2017, the Court has reaffirmed Foster v British Gas and other cases that where a person is able to rely on a Directive against emanations of the State he or she may do so regardless of the capacity in which the public authority is acting, whether as public authority or e.g. employer, and that “unconditional and sufficiently precise” provisions of a Directive, whether or not transposed into domestic law, can be relied on against emanations of the State (such as local authorities).

 

 

State Aid

October 11th, 2017 by James Goudie KC in Capital Finance and Companies

There is an obligation on public authorities to recover unlawful State Aid. The nature of this obligation has been considered by Advocate General Sharpston in an Opinion delivered on 10 October 2017 in Case C-363/16, European Commission v Hellenic Republic. Read more »

 

Secure Tenancy

October 6th, 2017 by James Goudie KC in Housing

The Court of Appeal has held in Harris v Hounslow LBC (2017) EWCA Civ 1476 that a secure tenant was not entitled to a statutory review of the local housing authority’s decision to apply for an anti-social behaviour  possession order, because he had applied outside the 7 day period laid down by Section 85ZA(2) of the Housing Act 1985.  Nor can the 7 day period be extended or waived.  The purpose of this mandatory ground for possession (the most serious cases of anti-social behaviour) is swifter relief for victims, witnesses and the community. In the public interest speedy relief is of the essence.  Lewison LJ added (para 27) that “the general application of public law principles must not be allowed to undermine the legislative scheme of this mandatory ground of possession”.

 

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