December to have your say. Landlord's consent to assign .... and in November secured commitmentsfrom four cloud storage
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The months key commercial legal stories that could affect your business
December 2016 Intellectual Property > Consumer > Competition >
Corporate & Commercial > Data Security > Employment >
Corporate & Commercial
When is a contract binding? The recent Wells v Devani case concerned an Estate Agent’s claim for commission. The Court of Appeal, overturning the High Court decision, said that because the trigger for commission had not been agreed – there was no contract. The Court of Appeal dismissed the High Court’s opinion that this detail could be implied in the contract as this would be putting the “cart before the horse”; there must be a contract before you can consider implying terms into it.
The Fourth Money Laundering Directive The Fourth Money Laundering Directive (4MLD) will be implemented in 2017 and will make numerous changes to existing anti-money laundering laws, particularly the requirement to have beneficial ownership of companies reported in real-time rather than annually. BEIS is seeking views on the implementation of 4MLD. You have until the 16th December to have your say.
Court Cases > Glossary of terms > What’s it all about >
Landlord’s consent to assign It’s a common problem; a tenant wants to assign a lease, the lease says that the assignment is subject to consent not to be unreasonably withheld, but the parties have a difference of opinion on what’s reasonable and how quickly it should all happen. It’s often forgotten, however, that the Landlord and Tenant Act 1988 also places a statutory duty (and the onus of proof) on the Landlord to be reasonable. In the recent case of West India Quay v East Tower Apartments, the Landlord required a bank reference, a survey and an undertaking for its costs of £1,600. The tenant said it was unreasonable and that the Landlord was too slow. The High Court determined that the delay was not unreasonable. The clock only started to tick when the application was served on the correct address and the Landlord had dealt with it within 14 days. The conditions of a survey and a bank reference were reasonable but, unfortunately for the Landlord, the undertaking for costs was not.
Frustrated Contracts In the recent Court of Appeal decision of Armchair Answercall v People in Mind, the Claimant successfully argued that the Defendant was not entitled to end the contract based on the common-law doctrine of frustration. The Defendant claimed the contract with the Claimant was frustrated because the contracted services relating to the management of third parties had already been terminated.
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Employment
The Court of Appeal, however, determined that frustration did not apply here because: • The description of the contracted services was wider than the Defendant had stated • The Defendant had delayed the termination • For frustration to apply the frustrating event must be an outside event that’s not foreseeable
Data Security
Rights of Uber drivers The Employment Tribunal case of Aslam and others v Uber has been the big employment law story in the last few weeks. This is one of the first of the so-called “gig economy” cases to come to a tribunal. The Claimants successfully argued that they were workers and therefore entitled to paid holiday and the minimum wage. The Tribunal dismissed Uber’s arguments that the Claimants were self-employed as nonsense. The Claimants are: • Paid by Uber – not the passenger
The latest on the GDPR The UK government has confirmed that regardless of Brexit it will be implementing the GDPR by 25th May 2018. The ICO has published guidance on GDPR preparation together with areas for prioritisation.
EU-US Privacy Shield Challenges As we’ve previously predicted, two challenges (Digital Rights Ireland and La Quadrature du Net) have now been lodged in the European Court to annul the EU-US Privacy Shield. We’re not yet sure how long these proceedings will take, but we’ll keep watching this space and bring you further updates.
• Not permitted to have the contact details of the passengers • Not allowed to substitute themselves for another driver • Uber performance manage them These are all factors that point towards a worker status, rather than being self-employed.
Intellectual Property
Subject Access Requests
Grey goods – a criminal offence
In the case of McWilliams v Citibank, an employee who had been dismissed made a subject access request (SAR) for information relating to her, which was refused. The Employment Tribunal determined that even if the SAR was disproportionate the employer must still supply documents on a more limited or proportionate basis rather than an outright refusal. This is a good reminder that employers should not use technical legal rules in employment cases but must stand back and consider what’s reasonable.
It has always been clear that the Trade Marks Act 1994 (TMA) has criminalised the sale of counterfeit goods. However, a recent decision has confirmed that the TMA also criminalises the sale of grey goods. Grey goods are goods that are genuine goods but the sale has not been authorised by the brand owner. Typically, this relates to the unauthorised sales of goods within the EU (provided the brand owner has not already placed the goods for sale in the EU). This is good news for brand owners as it provides another weapon for their fight against infringements. It’s unlikely however that Trading Standards will take enforcement action so brand owners will need to use private prosecutions. 2
Consumer
Competition
Unfair terms
Discriminating within the EU
The Consumer Rights Act implemented in 2015 outlaws unfair terms in consumer contracts. However, research by the CMA has identified that more than half of businesses are unsure of the law on unfair contract terms. To address this lack of awareness the CMA has written a blog and has produced explanatory videos.
We have previously reported on proposals by the European Commission to ban traders from discriminating against customers located in other EU member states. This is typically done by redirecting customers to websites depending on where they are located - a practice known as geo-blocking.
The CMA has also taken action to enforce the fairness rules and in November secured commitments from four cloud storage providers to implement fairer terms to their customers. The changes include ensuring customers have clear information on how to cancel contracts if they do not want to accept changes to the current terms.
A draft Regulation has been published that will be directly applicable to UK businesses and is expected to be in force by mid-2017. We’ll keep watching the space and bring you more developments next year.
Court cases Follow the links below for further reading on this months court cases in LexisPSL.
Armchair Answercall Limited v People in Mind Limited [2016] EWCA Civ 1039 Aslam, Farrar and Others v (1) Uber B.V, (2) Uber London Ltd and (3) Uber Britannia No.2202551/2015 McWilliams v Citibank NA, Case Number: 3200384/15 R v C [2016] EWCA Crim 1617 (Grey Goods case) Wells v Devani [2016] EWCA Civ 1106 West India Quay (Residential) Ltd v East Tower Apartments Ltd [2016] EWHC 2438 (Ch)
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Glossary of terms 4MLD
Fourth Money Laundering Directive ((EU) 2015/849)
BEIS
The Department for Business, Energy and Industrial Strategy
CMA
Competition and Markets Authority
GDPR
General Data Protection Regulation
ICO
Information Commissioner’s Office – an independent authority set up to promote and enforce data privacy laws
SAR
Subject Access Request – a right given to individuals (under the Data Protection Act) to obtain any personal data held about them by organisations (subject to some exemptions)
What’s it all about? This table details the background to some of the live matters that we are regularly discussing in our bulletins (Alphabetical order):
EU-US Privacy Shield
The EU-US Privacy Shield is the replacement for the Safe Harbor scheme and allows companies to transfer personal data to U.S. Privacy Shield registered companies and be compliant with Data Protection laws. The scheme has been available since August 2016.
GDPR will be directly applicable and effective in May 2018. It makes significant changes to existing Data Protection laws. The headline change is that companies may be liable to pay penalties of up to 4% of their total worldwide turnover. The new law also includes requirements on companies: GDPR
• To appoint a data protection officer – large companies only; • To notify data breaches to the relevant data protection authority within 72 hours; • To conduct privacy impact assessments before they carry out high-risk data processing; and • To build in privacy by design when processing personal information.
Safe Harbor
The Safe Harbour scheme had permitted companies to transfer personal data to U.S. Safe Harbour registered companies and be compliant with Data Protection laws. The Safe Harbour Scheme was invalidated in late 2015.
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