ContractStore Legal Business Blog

From next month, internet shoppers will no longer have to pay customs duty on non-EU purchases worth up to £105.

Customs duty is currently payable on goods bought online from non-EU countries worth £18 (Euro 22) or more. But from 1 December, the new £105 (Euro 150) limit will apply. VAT will still be charged on goods over £18, and is not affected by the changes.

A new HMRC ‘internet shopping’ podcast, launched today, explains the changes in more detail. As well as duty and VAT, the podcast discusses handling fees, which mail carriers are entitled to charge and collect from you on delivery, where duty or VAT is payable.

HMRC’s Director of Customs & International, Doug Tweddle, said:

“Whether you’re looking to get your hands on the latest computer game, designer clothes or DVDs, it’s important to be aware of the law on customs charges, especially as this is about to change.

“If you’re thinking of doing a little web shopping from abroad, download our podcast or visit the HMRC website and get up-to-speed with all things online - it won’t cost you a penny.

The podcast is available to download free from http://www.hmrc.gov.uk/podcasts.

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There is to be a fundamental review  of the costs of civil litigation.  Lord Justice Rupert Jackson has been appointed to head the review which begins in January, with a report scheduled for issue in December next year.

There is concern in  Government and legal circles that legal costs are too high and the English courts are losing out to other jurisdictions.  A number of high profile cases in recent years have seen some very high fees - e.g £5.2 million for the fees of one City law firm in a 5 day case involving Blackberry earlier this year, and more than £100 million in the ten years of litigation involving the creditors of failed bank, BCCI.

Legal fees in the City of London are matched in extravagance only by those in New York, so it is hardly surprising that there is a certain amount of “forum shopping” for commercial litigation whenever this is feasible.

Under English law the winning side almost invariably gets costs awarded in its favour and, while this usually means only about 70 per cent of the fees are in fact recovered, it also means that those with deep pockets can use the court system to threaten smaller companies or individuals and access to justice is in danger of becoming the prerogative of the rich.  In other countries, the claimant may have to bear his own costs.

Jackson LJ will be assisted in the review by a small group of experts.

Whether City law firms will reduce their fees in the coming recession remains to be seen - in recent years hourly rates  have been rising at way above the rate of inflation.  But there is some retrenchment - the Financial Times reports today that at least one City firm is cutting costs  - by cancelling its firm-wide Christmas party for the staff! 

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Southern Solar was set up in 2002 by Howard Johns, who is passionate about the environment and was always interested in renewable energy. The company fits solar panels for domestic, commercial and public buildings looking to reduce their environmental impact.

When Johns brought in additional shareholders, the company was still in its infancy. The high cost of setting up a solar power company was squeezing budgets to their limits so the group were reluctant to bring in lawyers having been quoted over £1000 for drafting a shareholders agreement.

Prospective shareholder Luke Hutchison suggested using  ContractStore’s “Shareholders Agreement for Three or More Parties“, but the group were initially wary. How would they know whether the document would cover what they needed?

Luke showed them the explanatory notes that users can read before purchase and pointed out that even with the tightest of budgets, the purchase price of £50  represented a relatively small risk.  Having read the notes, the group agreed to download the contract. A lawyer was consulted to check it over, at a much lower cost than initially quoted, and they all signed.

“We were amazed that the agreement could be finalised so quickly and at such low cost. It was really a fantastic find,” says Luke.

“If we hadn’t used the ContractStore we might have tried to avoid using a contract altogether, or pieced one together ourselves. This way we have a really solid agreement that provides the basis of trust that allows each of us to concentrate on building our company together. It also allowed us to focus our financial resources where it mattered most”

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Photographers should all be aware that when photographing someone they ought to have the subject’s permission before using the photograph for any kind of profit (whether its financial or in-kind). We are offering for a limited period, a free download of our new Photographer’s Model Release Form - so there’s now no excuse not to protect your rights and those of the model or subject.

You may also find the Photographer’s Terms of Business, which comes with a simple form for agreeing a job with a client, of interest.

Let us know your feedback on our documents, and if you like them, tell others and link back to us.

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Since 1st January 2007, every company in the UK must provide corporate details on its websites and in all emails that it sends.

The details you must display on both your website and on emails are:

• the company name (if this is different from the trading name then the difference should be made clear)
• the registered office address of the company
• the registration number and country of registration

The details you must make available on your website are:

• an email address where the company can be contacted (this is not needed on emails from the company)
• membership of any trade or professional association including the registration number
• the VAT number if VAT registered.

Make sure your website and email signatures are up to date right away.

ContractStore offers a free website privacy policy for use on your website - if you use it you are requested to put a link back to ContractStore as a credit.

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New rules about doorstep selling came into force yesterday, 1st October.

The Doorstep Selling Regulations cover all salespeople who visit consumers in their homes to sell any goods and services such as conservatories, double glazing, orthopaedic furniture and utility contracts.

The law has always provided a one week cooling off period when buying from salespeople whose visit has not been sought out by the homeowner. However, changes to the regulations mean that provided the transaction is for more than £35, consumers will now have a seven day period in which to cancel any agreement they enter into, regardless of whether they initiated the visit or not.

The new regulations also mean that doorstep sellers are required to inform customers in writing of their right to cancel.

For more details go to:

http://www.consumerdirect.gov.uk/before_you_buy/be_aware_of/doorstep-selling#named2

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ContractStore attended the 5th  China International Small & Medium Enterprises Fair in Guangzhou, China this week.

There were some 4000 exhibitors and ContractStore, as one of the companies on the British island, arranged by Global Business Associates, was there to promote our dual language Chinese and English contracts as well as our support services to Chinese companies interested in doing business in the UK.

On the second day ContractStore MD, Giles Dixon and Asia manager, Xie Rong, gave  a well-attended seminar to  visitors on the topic of legal documents for business and establishing a presence in the UK.

Our picture shows ContractStore’s Giles Dixon and Xie Rong with four students from the Guangdong University of Foreign Studies, MissLin Qiping, Miss Li Junyu, Mr Xiao Yao and Mr Shen Jianming, who provided enthusiastic support for our marketing activities. We were very impressed by their excellent command of English and their quick understanding of our existing business and objectives.

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The Association of Consultant Architects has published a new client contract and in the process has attacked the RIBA for its standard form, published last year.

According to the ACA the RIBA form leaves practices open to ‘potentially disastrous’ professional indemnity insurance (PII) problems as it includes a clause stating  the architect performs ‘his services in accordance with any budget or timescale agreed with the client’.   The ACA maintains that failure to meet this obligation by the architect would not be covered by insurance policies which is ‘ potentially ruinous’  for an architect.

 The ACA claims its own new contract meets the need for a fair and balanced standard form of agreement.   It does, nonetheless, include a ‘no set-off’ clause,  and a provision for the architect to resign from a commission.

A spokesman for the RIBA remarked that ‘a  plethora of different standard contracts is certainly not helpful to either architects or clients.’

Here we agree: any sensible developer  appointing an architect and other professional consultants on a project is advised to steer clear of the forms produced by professional institutions  as they tend to favour the consultant over the client and, as each form is different, they present administrative problems. 

 Much better to use a form that has essentially the same terms and conditions for all the professional team and which is fair to all parties while, at the same time,  looking after the client’s interests. ContractStore’s Appointment of Professional Consultant B100 is recommended. 

 So,  use our document - which is written in clear English  by a construction lawyer - and leave the architectural institutions to argue with each other.

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The UK Border Agency (part of the Home Office) has announced that from “the end of November” employers who wish to employ skilled migrant workers from countries outside the EEA (i.e. the countries of the EU, Norway, Iceland and Liechtenstein) and Switzerland must first apply for a licence. Charities and small businesses must pay £300 for a licence and all other employers will be charged £1,000.

In addition employers must obtain a ‘Certificate of Sponsorship’ for each migrant worker at a cost of £170 per certificate. Breach of these regulations may lead to civil or criminal penalties. Employers who wish to apply for a licence are urged to do so before 1st October.

A more detailed guide to this complex area can be found here

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The OFT (Office of Fair Trading) has today approved a scheme to deal with complaints about estate agents -as if they don’t have enough problems with the housing slump!

Buyers and sellers of residential property will, from October, be able to refer complaints concerning members of the scheme to an ombudsman, which will have the power to make a range of awards, including requiring a member of the scheme to pay compensation. The ombudsman’s decision is binding on the estate agent, although a complainant can choose to reject the decision and pursue their complaint through the courts. The SOS approved redress scheme will be a free service to complainants. From 1 October it will become compulsory for all estate agents dealing with residential property in the UK to join such a scheme.

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