My previous blog post on the decision of C v D - see – http://www.interalialegal.com/2011/01/when-is-an-expressed-reference-to-a-part-36-offer-not-a-valid-part-36-offer/ has now been overturned on appeal.  The essence of the Court of Appeal’s decision [2011] EWCA Civ 646, is below.

On 27 May 2011, the Court of Appeal heard the defendant’s appeal (Rix, Rimer and Stanley Burnton LJJ).  The three questions before the Court of Appeal were:

(i) Can a Part 36 offer be made in terms which limit the acceptance of the offer to a stipulated period, such that the offer lapses at the end of that period?;

(ii) What the true construction was of the respondent’s offer being “open for 21 days” in the context of what was clearly intended to be a Part 36 offer?; and

(iii) If withdrawal of a Part 36 offer is necessary, was the respondent’s offer withdrawn – either by the time limited terms of the offer itself, or by the emails which followed it.

Rix LJ gave the leading judgment of the Court (with which Rimer and Stanley Burnton LJJ concurred). 

On the first question Rix LJ concluded that it could not, for essentially three reasons.  First, Rule 36.9(2) indicates that a Part 36 offer comes to an end by withdrawal rather than in accordance with its own terms, since otherwise the offer can be accepted “at any time”.  Secondly, the Rule 36.14(3) sanction does not apply where the Part 36 offer is withdrawn and it is the policy of Part 36 that for benefits and sanctions to work, then the offer must be kept open.  Thirdly, there is no express loss of sanction where the offer lapses as distinct from being withdrawn, but it would be unfair if a claimant could maintain the benefit of a Part 36 offer which lapsed where he could not maintain its benefit where it was withdrawn. 

The Court of Appeal had regard to its earlier decision in Gibbon, especially paragraph 16 of Moore-Bick LJ’s Judgment where he said:

“The Rules state clearly how a Part 36 Offer may be made, how it may be varied and how it may be withdrawn.  They do not provide for it to lapse or become incapable of acceptance on being rejected by the offeree.  That would be the case at common law, but it is inconsistent with the concepts underlying Part 36, which proceeds on the footing that the offer is on the table and available for acceptance until the offeror himself chooses to withdraw it.”

Rix LJ went on to express that the Part 36 regime could not accommodate a time limited offer.  The essence of a Part 36 offer is that it lies on the table until formally withdrawn.  Therefore, the scheme seeks to encourage offers which are not time limited.  The scheme nevertheless permits flexibility in permitting offers to be amended and withdrawn.  This process, however, is strictly regulated in the interests of clarity and certainty. The Court of Appeal construed the claimant’s offer in the context of the Part 36 regime and accordingly found that such a regime does not permit an offer within the scheme to be time limited.

On the second question Rix LJ found it reasonable to read the words “open for 21 days” as meaning that it will not be withdrawn within 21 days, as opposed to the offer would automatically lapse at the end of that period. He also applied the maxim that words should be understood in such a way that the matter is effective rather than ineffective.

The Court of Appeal had no trouble disposing of the third question. They found that none of the exchange of emails in this particular case amounted to a withdrawal of the offer; they simply confirmed an extension of the 21 day period.

The Court of Appeal allowed the appeal and found that the defendant’s acceptance of the alternative offer to pay £2,000,000 on 5 November 2010 was effective on the basis that the claimant had made a Part 36 offer which had never been withdrawn.

When the High Court gave judgment in this case, it was the words of the offer that were important; the offeror’s intention was not relevant.  The Court of Appeal has reversed this thinking by clarifying that if it is the claimant’s expressed intention to make a Part 36 offer, any ambiguities raising a question as to whether the offer does or does not comply with the requirements of Part 36 will be interpreted in a way to make it so compliant.

From 1 October 2011, the adult national minimum wage will increase from £5.93 per hour to £6.08 per hour.

Other increases that take effect at the same time are:

• 18-20 year olds (£4.98 per hour; currently £4.92 per hour)
• 16-17 year olds (£3.68 per hour; currently £3.64 per hour)
• apprentics (£2.60 per hour; currently £2.50 per hour)

The question remains as to whether, with the effect of rising inflation, the increases will have any meaningful effect.

In recently perusing “Bar Barometer – Trends in the profile of the Bar” for March 2011, the following statistics show that the Bar is a male-dominated profession by a ratio of 2:1; over three-quarters of the profession are white and white QCs account for over ninety per cent of the practising profession. 

The Bar Council and the Bar Standards Board have stated that “continuing to enhance equality, diversity and fair access to the profession are strategic priorities and fundamental objectives”.

The Bar

• In 2009/10 15,270 barristers held practising certificates
• 12,241 (80%) were self employed and 3,029 (20%) were employed
• 10,011 (65.6%) were men and 5,259 (34.4%) were women
• 1,545 (10.1%) barristers are from a black and minority ethnic group
• 11,721 (76.7%) were white barristers
• 2,004 (13.1%) did not disclose their ethnicity  

Queen’s Counsel

• In 2009/10 there were 1,318 members of Queen’s Counsel (QC)
• QCs constituted 8.6% of the practising profession
• 1,179 (89%) were men
• 139 (11%) were women
• 57 (4.3%) were from a black and minority ethnic group
• 1,207 (91.5%) were white barristers
• 54 (4.1%) of barristers did not disclose their ethnicity

As a further note to readers, Mrs Justice Dobbs is the only BME judge in the High Court (out of 108 High Court judges).  There are no BME judges in the Court of Appeal (out of 37 Lord Justices of Appeal) or the UK Supreme Court (out of 12 Supreme Court justices).

Rudyard Kipling Thorpe (Litigation Friend of Leonie Leanthie Hill) v Fellowes Solicitors LLP [2011] EWHC 61 (QB) is authority for the proposition that solicitors have no need to investigate an elderly person’s capacity to contract without good reason. 

 Facts:

• In 2003 Fellowes Solicitors LLP were involved in the sale of a house by Leonie Hill who was then 78 and at the time instructions were taken was suffering from a progressive form of dementia;
• The proceeds of sale from the home went to Mrs Hill’s daughter. Mr Thorpe, Mrs Hill’s son, did not get a penny;
• Using his mother’s dementia as an advantage, he applied to the Court to become her guardian; and
• A claim was brought against Fellowes Solicitors LLP which, among other things, alleged that they failed to appreciate that the vendor was a vulnerable person and failed to enquire about her mental capacity.

The claim failed primarily on the basis that the solicitor had made contemporaneous attendance notes of her actions and also that she had asked Mrs Hill to attend her offices so that she could satisfy herself that Mrs Hill fully understood what was going on.  After that meeting, the solicitor’s attendance note recorded that Mrs Hill was “adamant” that she wanted to sell up and the proceeds of sale were to go to her daughter.  This was evidence that Mrs Hill understood what was about to occur. 

Mr Thorpe’s case was weakened further by medical evidence: a Dr Cockerell held the view that Mrs Hill might have been suffering from dementia in 2003, but that it would not have interfered with her decision making; and also that in any case a lack of capacity would not have been obvious. 

In dismissing a claim that Fellowes Solicitors LLP had acted negligently, Sharp J expressed that the claimant had failed to establish that a lack of capacity “would have been evident to a reasonably competent solicitor.”  Sharp J went on to add that “There is plainly no duty upon solicitors in general to obtain medical evidence on every occasion upon which they are instructed by an elderly client just in case they lack capacity.  Such a requirement would be insulting and unnecessary.”

In the last 12 months High Court figures show that the number of professional negligence claims have soared.

According to the figures there were 147 professional negligence actions in the High Court in 2008, which rose to 339 in 2009 (a 130.6% increase). 

Professional negligence claims against accountants rose from 0 in 2008 to 28 in 2009.

Surveyors and estate agents claims rose from 1 in 2008 to 17 in 2009.

Solicitors’ actions rose from 80 in 2008 to 210 in 2009 (a 162.5% increase).

Claims from other professionals rose from 66 in 2008 to 84 in 2009 (a 27.3% increase).

In the “age of austerity” it seems that professionals have seen themselves being first in the line of fire when unhappy clients are looking for someone to sue.

The Legal Services Board’s (LSB) research findings show a profession segmented by gender,  race and class.  Below is a summary of the key points:

* White graduates from higher socio-economic groups are over represented at large City firms and the Bar, while BME women from lower socio-economic groups are concentrated in small high-street practices

* 75% of partners in law firms are still men and only 5% are from a BME background

* The rank of QC is dominated by 90% men (although roughly equal numbers are being called to the Bar)

* Research suggests that women and BME lawyers leave the profession in disproportionately high numbers

* The profession has a possible bias against non-white professionals and those from lower socio-economic groups

Research reveals a disproportionately high number of cases involving BME solicitors were referred to the Solicitors Regulation Authority (SRA), the profession, and bodies such as the Legal Complaints Service (LCS).

Research by consultants Pearn Kandola also found that BME solicitors were more likely to have restrictions placed on their practising certificate by the SRA.  A ‘consistent pattern’ of BME solicitors are also being referred to the Solicitors Disciplinary Tribunal (SDT).  The report showed that solicitors from Nigeria, India, Pakistan and Bangladesh were most likely to have cases raised against them by sources outside the SRA.  However, it said that a solicitor’s ethnicity ‘in itself does not predict whether they are more likely to have a case raised against them’.

The report revealed three factors that contributed to the disproportionately high number of cases raised against BME solicitors:  

1)      the fact that they were often newly-qualified;

2)      that many worked in small firms; and

3)      that they often worked in BME-owned firms

Has the Law Society/SRA been fully committed to equality and diversity? Regular readers and followers of this blog are, as always, invited to leave comments.  My previous blog post on BME solicitors either being denied professional indemnity insurance - or having to pay much higher premiums - can be seen by clicking http://www.interalialegal.com/2010/06/allegations-made-that-bme-solicitors-are-being-denied-professional-indemnity-insurance/

The public can now submit ideas on repealing unnecessary laws and ending excessive regulation by visiting http://yourfreedom.hmg.gov.uk/

Dr Kate Pretty, principal of Homerton College, Cambridge, has stated that A-levels are not adequately preparing teenagers for university and has found that students were arriving at university with short attention spans because they had taken A-levels in bite-sized chunks.  “The gulf between the end of A-levels and the start of degrees was now too great”, she said.

Dr Pretty has told Michael Gove, the Education Secretary, and teachers at the PTI annual conference in Cambridge that the bulk of the A-level syllabus “focused on acquiring and revising knowledge just for exams“.  Dr Pretty said that “Students don’t have the memory skills.  Learning to retain [information] over a long period is something they struggle with in some cases.  They’re used to learning in bite-sized chunks and only what they need to know for examinations.  That comes from early exposure to the mentality, ‘you’ll need this, you won’t need that’, which has bedevilled the British state system”. 

As always, comments and views are invited on Dr Pretty’s opinions.  Perphaps a discussion could start on whether there are benefits of doing A-level law and then going on to read law at university.  If any students did this, please feel free to comment.

In Kernot v Jones [2010] EWCA Civ 578, the Court of Appeal held that Leonard Kernott was entitled to a 50% share of the home he lived in for eight years with his former girlfriend, Patricia Jones, despite the fact that he had neither paid for nor lived in it since 1993.  It was Patricia Jones since 1993 that had paid the mortgage and brought up their two children. 

Wall LJ referred to this case as a “cautionary tale, which all unmarried couples who are contemplating the purchase of a residential property as their home, and all solicitors who advise them, should study”.   Wall LJ went on to add that “In my judgment, the conveyance into joint names… created joint beneficial interests, and the parties agreed that when they separated they had equal interests.  There has to be something to displace those interest, and I have come to the conclusion that the passage of time is insufficient to do so, even if, in the meantime, the appellant has acquired alternative accommodation, and the respondent has paid all the outgoings…” 

By a 2:1 decision, the Court of Appeal overtuned the High Court’s previous judgment that the dispute should be decided on the basis of what was “fair and just”, and that Patricia Jones was entitled to a 90% share of the interests in the property. 

My earlier commentary on the issue of cohabiting couples and the residential home can be seen at http://www.interalialegal.com/2008/07/where-theres-a-will/

Readers and regular followers of this blog are asked to comment on:

a) do you agree with this decision?

b) should the courts treat human emotional relationships akin to commercial contracts when disputes do arise?

c) is there now a need for the reform of cohabitants law?