May News Articles
Three out of four HMO landlords have applied for licences
New research has found that 78% of landlords that let Houses of Multiple Occupation (HMOs) have applied for the necessary licence.
The survey was carried out on behalf of the Department for Communities and Local Government which says the figures show that the system is working well – although it means, of course, that nearly one in four landlords have not applied and so some could be at risk of being fined up to £20,000.
Not all HMOs need to be licensed, but most will if they are three storeys or more and are occupied by five people or more who share some facilities.
The Government established the licensing system as part of the Housing Act 2004 to improve the control of HMOs and ensure proper management standards. The provisions for the licensing of HMOs and the discretionary licensing of other rented accommodation came into effect in April 2006.
Letting a qualifying HMO without a licence, or allowing it to be occupied by more tenants than specified on the licence, is a criminal offence punishable by a maximum fine of £20,000.
Breaches of licence conditions are subject to fines of up to £5,000.
HMOs that are not licensable are still subject to management regulations which impose duties to ensure minimum safety and maintenance requirements are met and fire precautionary equipment is up to standard. Breaches in these management regulations can lead to a fine of up to £5,000.
Woman wins appeal to get a half share of house
A woman has won her appeal that she should be granted a half share in the house in which she lived with her former partner.
The couple were not married but had bought a house together with a mortgage in their joint names. Her partner paid the deposit and then the mortgage instalments. There was no declaration of trust outlining their intentions as to whether the property was to be owned jointly or shared in some other way reflecting their particular circumstances.
When the couple separated, there was a disagreement about ownership of the property. The woman’s partner submitted that although he had agreed to the property being in joint names, he had only intended that she should inherit it after his death.
The judge ruled that in the absence of a declaration of trust, the property should be shared in direct proportion to the contribution each had made to the purchase price. The woman had not made any contributions so her partner should be granted ownership.
However, that ruling has now been overturned by the Court of Appeal. The Appeal Court judges said that in the absence of any legal document such as a declaration of trust it was necessary to try to ascertain what each party’s intentions had been by the way they had bought the property and their general conduct in relation to it. For example, the fact that each had made a will leaving their interest in the property to the other suggested that they had each intended the other to have a share in the ownership.
The court allowed the woman’s appeal and granted her a half share in the property.
It is not uncommon for disputes to arise when couples separate. Much of the confusion and emotional upset could be avoided if they drew up legal documents such as declarations of trust or living together agreements which clearly set out how assets should be divided should the relationship end.
Please contact us if you would like more information.
Warehouseman awarded £44,000 after fracturing his wrist
A man whose earning capacity was reduced when he fractured his wrist at work has been awarded a total of more than £44,000 compensation.
Paul Morgan was working as a warehouseman when he tripped and fractured his left wrist. Mr Morgan, who is left-handed, was 26 at the time of the accident. He submitted that the injury would handicap him in his ambition to start up in business as a mechanic.
His employers accepted liability and did not challenge the award of more than £21,000 for the pain, suffering and loss of amenity but appealed against the £22,800 awarded for the loss of earning capacity.
However, the Court of Appeal upheld the award saying that although it was generous, it was not so generous that it should be overturned.
Part time lecturers win appeal over discrimination claim
The Employment Appeals Tribunal has upheld a claim by a group of part time lecturers that they were discriminated against by their employer.
The lecturers worked for Manchester City Council’s Adult Education Service and were guaranteed a specific number of hours per year. The Service then reduced the hours, prompting the lecturers to bring a claim that they had been discriminated against because the hours of full time employees had not been reduced in the same way. They said this breached the provisions of the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000.
The council denied this and argued that the contracts of the part time lecturers allowed flexibility. That flexibility was not part of the terms and conditions within the contracts of the full time employees. The case went to an employment tribunal which ruled in favour of the council but that was then overturned by the Employment Appeals Tribunal (EAT).
The EAT ruled that the protection offered by the Regulations to part time workers would be completely undermined if employers could argue that they were being treated differently because of the terms of their contract rather than because of the number of hours they worked. The ruling specified that once it is established that a part time worker is treated less favourably and the fact that he is part time is one of the reasons for the less favourable treatment then the Regulations are triggered and will apply.
The case will now be heard before another employment tribunal to decide how the issue should be remedied.
Inheritance tax liability set aside by Court
The executors of a man’s will have succeeded in removing the need for inheritance tax to be paid on some of the assets he transferred to other people a few years before he died.
The gifts in question were potentially exempt transfers (PETs) – so called because if the person making the donation lives for another seven years then the recipient does not have to pay inheritance tax. However, if the donor dies within those seven years then there will be a tax charge.
In this case, the executors of the will submitted that the man would never have made the transfers if he had known that there was no chance of him surviving for seven years. The court was told that the transfers were made in April 2003 and February 2004. The man was then diagnosed as suffering from lung cancer and died in 2005.
The court ruled that the first transfer made in 2003 could not be set aside because the man was not suffering from his illness at the time and therefore it could not be said that he had made a mistake in agreeing to the transfer.
However, the situation had changed by the following year. Had he known that he was then suffering from such a serious form of cancer he would have realised there was little chance of him surviving seven years and so he would not have made the transfer. This second transfer could therefore be set aside.
More Companies Act measures come into effect
More provisions of the Companies Act 2006 which are designed to reduce the administrative burden on private companies have now come into effect.
Two of the most significant changes mean that firms no longer have to appoint a company secretary unless they want to and they no longer have to have the signature of two directors to execute deeds. The signature of one director will be enough provided that it is witnessed.
Further measures now in force redefine small, medium and large companies by new turnover and balance sheet thresholds. There will need to be some changes to accounting and auditing practices, particularly when listing directors’ pay.
Several more Companies Act provisions will come into effect on 1st October this year. These include changes relating to trading disclosures, corporate directors and under-age directors, general duties of directors in respect of conflicts of interest, declarations by a director of an interest in an existing transaction or arrangement, and new procedures for private companies to make capital reductions supported by a solvency statement instead of by a court order.
Please contact us if you would like more information about any aspect of the Companies Act 2006.
HIPs now needed for all new build properties
Home Information Packs (HIPs) are now required on all new build homes.
Until now the HIP obligations applied to all sales including new homes but excluded homes built under the most recent building regulations, Regulation 17C of the Building Regulations 2006.
That changed on 6th April when HIP duties were extended to these properties. It means all new homes must now include an Energy Performance Certificate which must be produced by an energy assessor who is accredited for On Construction Energy Assessment.
The EPC must be given to the owner of the property when it is physically complete. Building Control cannot issue a completion certificate until this has been done.
Anyone marketing a home off-plan will need a Predicted Energy Assessment (PEA) as part of the HIP to show to potential buyers. When the property is complete, the PEA must be replaced with an EPC and a Recommendation Report.
Each home within a development must have its own EPC. However, identical properties can have a cloned report and do not need to be inspected separately.
Equality Commission backs man in ‘gay taunting’ case
The Equality and Human Rights Commission is to help a man take his case to the Court of Appeal after he was subjected to persistent homophobic banter from his work colleagues.
Stephen English, who is married and has three children, worked as a salesman for Thomas Sanderson Blinds in Portsmouth. He claimed that his work colleagues started calling him names and making homophobic comments to him after they found out that he had gone to a public school and that he lived in Brighton.
Mr English found the taunting so distressing that he felt he had to give up his job. He made a complaint of harassment under the Employment Equality (Sexual Orientation) Regulations 2003 but the tribunal rejected his claim because he was not actually gay and his work colleagues did not believe him to be gay even though they taunted him.
This meant he was not protected by the regulations because the taunting was not due to his sexual orientation but rather because his colleagues were reacting to stereotypical factors such as his having attended a public school and the fact that he lived in Brighton.
That ruling was upheld by the Employment Appeals Tribunal. However, Mr English’s case has now been taken up by the Equality and Human Rights Commission which believes the law needs to be clarified. A spokesman said a positive ruling by the Court of Appeal would help people who suffer harassment based on stereotypes.
New regulations on child support come into effect
The Government’s campaign to make more non-resident parents pay child maintenance takes another step forward with officials being given the right to extract more information from banks, credit reference agencies and the DVLA.
The Child Support (Miscellaneous Amendments) Regulations 2008, effective from 6th April, is intended to help develop a tougher enforcement regime by extending existing powers. For example, until now the Child Support Agency could only use the DVLA’s Vehicle Registration database for the purposes of tracing parents. Now the Agency will be able to use more detailed information available on the Driver Licensing database for collection and enforcement purposes.
The Department for Work and Pensions believes that “using information from both databases will increase compliance, free-up resources, reduce processing times and support longer term aims of reducing uncleared work to acceptable levels by 2009”.
The regulations will also increase the purposes for which the Agency can request information from credit reference agencies to include collection and enforcement, and in particular to support payment of arrears of child maintenance. It will also be easier for the Agency to get information from deposit takers such as banks and building societies.
Many of the changes may seem technical but they are designed to get more parents paying maintenance. They also demonstrate the Government’s determination to address the problem following widespread criticism of the Child Support Agency in recent years. The Agency is being replaced by the Child Maintenance and Enforcement Commission (CMEC). The Child Maintenance and Other Payments Bill now going through parliament is set to bring more changes.
We shall keep clients informed of developments.
Councils to raise millions when approving plans for new homes
Councils that approve planning applications for new homes are to be allowed to raise hundreds of millions of pounds from developers to pay for facilities such as schools, parks and health centres.
The Department for Communities and Local Government (DCLG) is introducing a new Community Infrastructure Levy which will help fund the Government’s drive to provide quality neighbourhoods.
According to Government figures, only 14% of residential planning applications currently make a contribution towards the cost of supporting infrastructure.
A DCLG official said: “Ministers think it is right that all developments pay their fair share and those who benefit financially when planning permission is given should contribute back to the local community by funding local infrastructure. That's why the new Community Infrastructure Levy (CIL) has been included in the Planning Bill.
“The new powers will allow councils to set a CIL for their area following an assessment of local infrastructure needs and consultation with their local community. Different types and sizes of development would pay different amounts depending on local needs to help ensure that the new infrastructure needed to maintain sustainable growth is provided.”
It’s likely that a wide range of developments will be affected because ministers believe that even small projects can have a cumulative impact on a local area and so should make a contribution to local infrastructure and facilities.
The Levy is being introduced as part of the Planning Bill. It’s expected that councils will be able to take advantage of their new powers from Spring next year.
Developments by homeowners such as extensions will be exempt from the levy.
Public use new powers to close licensed premises
The police and the public have been quick to use their new powers to ask for reviews of licensed premises.
In several cases, licences were suspended for up to three months or revoked altogether.
The Licensing Act 2003, which came into effect on 24th November 2005, gave people the chance to have a say in local licensing decisions that might affect them. Residents and the police can object to a new licence application or object about premises they consider to be causing a nuisance. They have the power to ask for a review of a licence whenever a problem occurs.
Figures released by the Department for Culture, Media and Sport show that in the 12 months up to 31st March 2007, there were 670 completed reviews.
They led to 90 licences being revoked and 91 being suspended for up to three months. In addition, 110 premises were forced to change their opening hours and 390 had other conditions placed on their licences.