Who’s Fault? Solicitors? Usually.

A [Temporary?] check upon the ever widening scope of a Solicitor’s liability?

For many years, a solicitor more or less knew where s/he stood. If the work done for a client was careless and the client lost money because of that, then the solicitor must repay.

But, if someone else, who was not a paying client of the solicitor, lost money because the solicitor was careless, then tough luck for them. The Solicitor was liable to his clients ONLY, end of story.

Until 1995, when [link here] White v Jones decided that a Solicitor must compensate intended beneficiaries of the client who wanted to make a Will in their favour, who gave clear instructions to that effect, and then died before the Solicitor could find time to see him and do the work.

If you read the case you will see that the case caused real difficulty to the Judges, who were well aware that in reaching this decision they were doing so in the face of all earlier precedent and established law. They were saying in so many words that “times have moved on” and that new law needed to be written

They considered that the facts
• that the law of 1995 did indeed say that the only person who “could” sue was the deceased – but he couldn’t because he was dead and he had suffered no loss, and that
• The intended beneficiaries who had suffered loss had no right to sue,
meant that there was a gap in the Law which was in their view intolerable to justice in this day and age.

And ever since, many solicitors feel that the principle has been widening until now the profession is basically seen as an insurer of last resort, which can pick up the tab whenever anything goes wrong, or whenever anyone suffers loss and a solicitor has been involved.

So perhaps there is a feeling that the tide may be turning, or at least has stopped coming in, in a recent case of Land Registry v Caffrey [link here].

Long story short, Mr and Mrs Turner, two crooks, turn up in the offices of Solicitors Caffrey & Co with a mortgage receipt which they have forged, and request Caffreys to submit it to the Land Registry. Nice plan. Of course most people clear off their mortgages by the more conventional means of repaying their debt but that does take longer.

So the receipt form was duly posted off and the Land Registry did clear the mortgage from the title and so the Turners were then, being crooks, able to mortgage their property all over again with another lender. Later the first Bank claimed successfully, and got its money back from the Land Registry.

In this case the Land Registry was chasing reimbursement from Caffrey & Co. Their case, they told the Judge, was that the Solicitors first owed a duty of care to take reasonable care in discharging the mortgage – which included checking that the discharge form was genuine – and second that by submitting the form to the Registry the Solicitors were implicitly representing that the form was properly executed and not a forgery.

The first claim was rejected, and it is clear from the judgment that the second claim would have failed also if the solicitors had bothered to contest it.

The Judge concluded that it was not fair, just, or reasonable to make the Solicitors responsible to the bank or the Land Registry for the risks of fraud “within a system which was inherently risky”. The Land Registry systems were not designed by the Bank and they were not designed by the Solicitors. So the Land Registry not the Solicitors, are responsible for any loopholes in that system.

So Hooray – if you are a Solicitor.

Even so, it seems to me that it would be a bit cavalier if the lesson from this case is taken to be that there is no need to worry about the genuineness of documents you as a Solicitor are asked to submit to the Land Registry. As a Solicitor, you are not just a postman. And even if you are vindicated after a long and expensive trial process, I think you would prefer not to be in that position in the first place.

The moral maybe, is that you can’t be too careful. Trouble is, in the real world, being careful costs money. Only you can decide where to draw the line between cost and risk. [Between caution and paranoia? – cue for a song [link here]

And may I suggest that this case would not have occurred if the Turners had approached Notaries to do their fraudulent bidding?

As always, Please do contact me or Louise whenever you need Notarial certification or Legalisation for your Documents– at http://www.atkinsonnotary.com – or phone me on 0113 816 0116 (internationally 0044 113 8160116)

Notarising Affidavits. Our Advice? Tell The Truth! Louise Explains

Notarising Affidavits. Our Advice? Tell The Truth! Louise Explains

One of the many services we at AtkinsonNotary offer is the notarisation of Affidavit documents for use in Courts overseas.

By swearing an Affidavit, you are putting yourself in perils of punishment for the crime of Perjury, if  ANY of the statements written in it are not true. In Malaysia and Singapore and some other countries, by the way, those penalties include a severe caning [for a man].

In all Countries that I know of the crime can result in lengthy prison sentences and in one or two states of the USA it can even result in the Death Penalty.

So, it’s not a trivial matter and you need to take care!

More specifically, I suggest you do not trust your Lawyers abroad to correct an incomplete document once you return it to them.

So, if you have an Affidavit that you require to be signed in the presence of the Notary then please note that if your Affidavit refers to exhibits [enclosures/attachments] then the Affidavit cannot be sworn or Notarised if the documents referred to are not with the Affidavit.

For example, we have seen a client who had been holidaying in America and unfortunately had witnessed a serious criminal act. [Man brandishing a gun in the course of a street “mugging”]. Our client had taken some photographs of the incident and passed them to the Police. Our client returned to the UK and was later asked by a Lawyer in America to swear an Affidavit to confirm what she had seen on that day and to also confirm that the photographs she had taken at that time were genuine.

The Affidavit was prepared by the Lawyer and sent to our client to bring to us for her to sign and then swear in the Notary’s presence. Having read the Affidavit it became apparent that it referred to the many photographs our client had taken as being “attached” but no photographs were there at our meeting. Our client confirmed the photographs were handed over to the police and she no longer had them.

We accordingly contacted the American Lawyer who had prepared the Affidavit to find out why no photographs had been sent with the Affidavit – the Lawyer informed us that he had the photos and they were sat on his desk.

We politely asked how our client was supposed to swear as the truth that photos were attached when the photos were not here! – Unbelievably [to us at any rate], the lawyer indicated that it was his intention to attach the photographs to the document once it has been sworn and notarised! – “Really” was our reply – “you are asking our client to risk the penalty of perjury by swearing a document which you as her Lawyer know is not true.”

Apart from telling a lie in our office, what if the wrong photographs were to be attached later by mistake!

After the Lawyer realised his error the photos were sent over accordingly to enable our client to proceed with the Affidavit. [Note from Chris Atkinson. – I don’t think he believed for a moment that he had made any error, he just thought we were being unbearably fussy.]

The point I am trying to make is that you cannot swear a document to be true if it is not!

If exhibits are referred to then the exhibits must be present at the time of the swearing – they cannot be attached at a later date. You cannot take that risk [and the Notary will not!]

Once a document has been sworn to and Notarised – stamped and sealed – it should not be tampered with in any way.

So if you have an Affidavit that you need to deal with in the presence of a Notary then please make sure all exhibits referred to are also brought to the meeting. This will avoid any unnecessary delays in getting the job done.

If in doubt then please do contact me or Chris Atkinson to discuss further.

As always, Please do contact me or Chris whenever you need Notarial certification or Legalisation for your Documents– at http://www.atkinsonnotary.com – or phone me on 0113 816 0116 (internationally 0044 113 8160116)

Why Deeds Matter. Doing it Right Matters. And Here’s Proof.

Why Deeds Matter. Doing it Right Matters. And Here’s Proof.

The job of a Notary is to ensure so far as possible that the format and wording and other processes, such as witnessing, and legalisation, of the documents which cross his desk are all compliant with the requirements of all relevant legal jurisdictions.

So if the document is for Florida, and is a Power of Attorney made by a company it needs to comply not only with the English law – including at least the Law of Property (Miscellaneous Provisions) Act 1989, the Powers of Attorney Act 1971 and The Companies Act 2006 – but also with the law of Florida including the provisions of The 2015 Florida Statures at Chapter 709.

So, in accordance with Statute Chapter 709 section 2105 subsection 2, there must be two witnesses to the signature, not only one as English law requires.

It is all very well to write this down in a blog, as if I were answering an exam question. But in the real world, things are different.

Only last week I had a client walk out of my office complaining that I am “overly pedantic”. This, because he had been told that his Deed for Florida needed to be signed in my presence and also before two witnesses. So, he produced to me the Deed, ready to sign whilst I was watching. However, there were two signatures to the paper already. He explained that those were the signatures of the “witnesses”, who could not attend the meeting.

Deep breath.

The problem, when you are trying to get the papers right, is that even when clients don’t say that I am overly pedantic, I suspect they are possibly thinking it. Am I milking it? It costs more time to do it right after all, so is the reason I try to insist on getting it right, simply to maximise my fees? After all, what does it truly matter, in the real world, if things are only “nearly right”?

And when I am challenged to give an example, I often find that I am relying on hypotheticals, on exam question scenarios, which is not what the client is asking for.

So I am pleased to read the following words written by a fellow Notary Mr Victor Warner. In them he identifies an actual real life case before the courts where a failure to meet the formalities of the law has had very significant consequences indeed.

Millions of pounds intended to benefit one set of pensioners are to be paid to others.

Compensation payments, legal payment, huge losses of money and time and pension entitlements flowing from a simple failure to sign in the presence of witnesses. And this is a case where no-one was misled and no fraud whatsoever was involved.

Victor writes “One of the pains of being a notary is getting documents, such as powers of attorneys, signed as deeds. Quoting the law and what Brooke’s says rarely brings home the effect of not signing a document as a deed.

But finding modern cases: 1. where a document needs signing as a deed; and 2. the document was not signed as a deed; and 3. where the court spells out the consequences of the failure to sign the document as a deed are rare in England and Wales.

It is almost impossible to find cases from Europe: 1. where a document needed signing as a deed in England; and 2. the document was not signed as a deed; and 3. the European court held that the document was not validly signed because the document was not signed as a deed, even though the way the document was validly signed in the European Country concerned.

I have not found the impossible, but this note provides details from a recent English case where the consequences about what can happen if a document is not properly signed as deed are spelt out: link here Briggs v. Gleeds (Head Office) [2014] EWHC 1178 (Ch), [2015] 1 All ER 533 The facts of the case of Briggs are far more interesting (at least for notaries, if not for pension lawyers) than the law applied: estoppel.

This note concentrates on those facts, and is an illustration of the danger: letting someone else have the opportunity to have a say on whether a document is validly executed (such as a judge); of someone not understanding (apparently) how different types of legal persons execute documents (such as, in this case, a firm of pension administrators).

The key facts. An employer (the defendant) (D)) is a traditional (Partnership Act 1890) partnership (and accordingly any deed needs signing by each of the partners (and if they are an individual, each partner needs to have her/his signature witnessed)); D set up a pension scheme for employees of the partnership;

The scheme was set up in 1974 before the enactment of Law of Property (Miscellaneous Provisions) Act 1989 with an interim deed. A definitive deed was signed in 1979; Subsequent to the coming into force of the 1989 Act (from 1991 to 2010) the employer signed 30 deeds.

They were not signed in accordance with the 1989 Act (that is each partner did not sign in the presence of a witness); A third party organisation was responsible for pension administration and they prepared the deeds (Aon Group, who were, it appears, hired by the pension trustees and not the employer).

For the partners, the Aon Group had failed to provide wording in the signature block of the deeds that the partners’ signatures needed to be witnessed; The Aon Group had, for the trustees of the pension scheme, added the necessary wording that the trustees’ signatures be witnessed.

The Aon Group had provided some signed instructions to the employer, but these were intended for a company (that is the Aon Group had failed to realise, or not bothered to check, that the employer was not a company, but a collection of individuals (a partnership)).

The problem with the 30 documents only came to light when the trustees of the pension scheme changed their legal advisers in 2010

Among the deeds not properly executed included: several deeds dealing with changes to the trustees; a deed (in 1997) to close a final salary pension scheme and replace it with a money purchase scheme (with 100 employees then choosing to join).
Relevant points from the judgment
1. The judge decided (unsurprisingly) that the deeds did not meet the formal requirements of a valid deed in accordance with the 1989 Act That is the deeds were not executed in the presence of a witness (and there was no wording to indicate that a witness was needed (such as ‘signature of witness’, ‘in the presence of’), or a signature which appeared to be that of a witness).
2. Accordingly members of the scheme (the claimants) could deny that the deeds had been validly executed (i.e. estoppel was not available to the defendant employer).
3. To decide otherwise, the judge found, would be to defeat the objective behind the 1989 Act. The requirement to sign in the presence of a witness, according to the judge, was: 1. to limit the scope for disputes; 2. to allow parties to have confidence that the signature of another party was genuine because it was attested; 3. to give some form of protection to a signatory who was under a disability; and 4. to emphasise to a signatory the importance of their act.
4. The judge distinguished the case from an earlier one, link here  Shah v. Shah [2001] EWCA Civ 527, [2001] 3 All ER 138. In that case, a party’s signature on a deed was ‘witnessed’, i.e. it appeared to be formally valid. In fact, the witness had not been present when the party signed.
5. The judge in Briggs held that the fact that a deed was apparently valid on its face in Shah but not in Briggs was the critical distinction as to whether estoppel could be invoked. To allow the use of estoppel where a document was not apparently valid on its face would mean that the deed cannot be taken at its face value, and lead to uncertainty. In effect, a person looking at a deed should be able to tell whether it is validly executed by simply looking it at, particularly as a deed can have a long lifespan, which can easily extend well beyond the time that those involved in the deed are around or any surrounding correspondence to the deed remains in existence.

Consequences The words of the judge are better than any summary as to the consequences of the continuing failure to sign a series of documents as deeds:
.. …Where, therefore, a document that was intended to take effect as a deed needed to be executed by partners [of the employer], each partner’s signature should have been attested by a witness. In the case of some 30 documents relating to the Scheme, that did not happen.
Were that to mean that the documents are all ineffective, the Scheme’s deficit on an ongoing basis could be increased by some £45 million.

…. The conclusions I have arrived at above will nonetheless mean that [the employers’] attempts to contain the costs of the [Pension] Scheme will have been largely ineffective. None of the deeds that were meant to establish money purchase sections, to require members to make contributions, to reduce the rate of accrual, to cut the rate of pension increases and to close the Scheme to further accrual will take effect as intended

…I am very conscious that this judgment has serious implications for the [Pension] Scheme and [the employer]. Nor will it be advantageous to all of those who have in the past been regarded as members of the Scheme.

In particular …, I take the view that employees who “joined” the [Pension] Scheme following the introduction of the 1997 money purchase section without being chartered quantity surveyors did not in fact become members (although that is not to say that they will not have acquired any rights as a result of the contributions to the [Pension] Scheme made by them and by [the employer] for their benefit).

Other members of [the employer] stand to receive what could fairly be called a windfall.
Unfortunate consequences are, I am afraid, unsurprising when so many documents have not been validly executed.

Comment.This case is a reminder, if needed, that the statutory requirements set out in the 1989 Act are applied strictly by some judges. A simple (clerical) oversight (no doubt), buried for over 20 years, has led:
1. to a pension scheme’s deficit increasing by a multi-million amount; and
2. to likely highly expensive and time-consuming work necessary to unravel the changes to the pension scheme made over many years. Particularly sobering as it appears everyone knew what was happening over the years, and no-one was trying to act in an underhand manner, or take advantage or was not aware of the changes to the pension scheme.

Thank you to Victor for letting me use his text. He has written two legal textbooks, links to the bookshop are here and here.

So what’s the moral of the story?
Listen to your Notary. “Pedantic” or not, He is trying to help! Link to a song. I’ve told you before, you can’t do that.

As ever, Please do contact me whenever you need Notarial certification or Legalisation – at http://www.atkinsonnotary.com or phone me on 0113 816 0116 (internationally 0044 113 8160116)

Who Would Be An Employer? Perhaps They Just Can’t Win.

Who Would Be An Employer? Perhaps They Just Can’t Win.

Since 1977, before my present incarnation as a Notary, I was a Solicitor and I worked in many areas of the Law. But one of them, I steered well clear of. That being Employment Law.

Frankly, I have never understood Employment Law. And in making that admission, and breaking the golden rule “Never admit, Never explain” you can see why I have retired as a Solicitor.

With Employment Law, even its basic principles have always seemed to me to be contrary to common sense and fairness. And then each new judgment of the Tribunals seems as likely as not to reverse the decisions made previously.

Perhaps someone among my readers may be a lawyer practicing in Employment matters, who takes a different view – please get in touch!

Here is a case from last month. Mohamud v Morrison Supermarkets Link Here.

A chap Mr M goes into a Morrison’s petrol station with a USB stick and asks whether it would be possible for a document to be printed off for him. Quite why he thought this was likely I do not know, maybe that’s what happens in Birmingham. At any rate it didn’t happen that day.

The employee of Morrison’s who was manning the petrol station – Mr Khan – shouted and swore at Mr M, chased after him, knocked him down and kicked him. A very serious assault. Unprovoked and, as far as one can see from the evidence, quite out of character on the part of Mr Khan.

The speculation is that the motive for the assault was racial. Perhaps Mr Khan does not like Somali people. If so, he had not mentioned this to Morrison’s.

By which I mean, there is no way that Morrison’s could have realised that this was the way Mr Khan was likely to deal with their customer Mr M. Or with any of their customers.

So who is liable to pay compensation to Mr M? Mr Khan obviously but he seems to have lost his job. Surely not Morrison’s, what should they have done to avoid this, apart from not employing any people? But oh, according to the Supreme Court, yes, Morrison’s have to pay. Never mind that the behaviour was a “gross abuse of his position” – Morrison’s “should justly be held responsible for (the consequences of) their employee’s abuse of it”

OK, really?

Yebbut, look at this from 2014, link here to Burdett v Aviva Employment Services Limited

Here is an employee who is a person with a disability. The nature of the disability is a paranoid schizophrenic illness. A consequence of his disability was a tendency to assault his work colleagues. Sexually, in the case of female colleagues and also in respect of a female independent contractor to his employers.

In order no doubt to stop any chance of further assaults happening, the employers had him arrested. Thereafter he was detained into secure psychiatric care.

His employers did not, as I think many would have, simply write him a letter to tell him he was dismissed. In fact they implemented a disciplinary process and only after receiving detailed medical evidence and evidence that there had been sexual assaults committed in the past, not revealed at job interview, did they dismiss him for gross misconduct.

Their point surely is that an employer cannot put its female employees at risk of sexual assault by continuing to employ a person who behaves in that way when he does not take his medication. If they did, what would be their defence when a female employee sues them for compensation after the next wholly predictable assault?

So, the employers did the right thing surely? Just like Morrison’s, they would be held responsible if an employee turned rogue and started hurting people. After all, Morrison’s had no idea that might happen, and they were made to pay.

You guessed it, the employers were found to have dismissed this man on the basis of discrimination arising from his disability. And that’s illegal.

So have I got this right: if an employee sexually assaults his colleagues because he just likes doing it, that’s one thing.

But if he does it because he is suffering from a dangerous psychiatric illness, it is illegal to sack him forthwith? I see. OK.

Yebbut again, back to Morrison’s.

Can they actually sack Mr Khan forthwith for his tendency to beat and kick their customers half to death just because he thinks they look unacceptably foreign?

Or, on the basis of Burdett , do Morrison’s now have to consider alternative positions within the organisation where Mr Khan’s talents can be allowed to blossom?

I wonder, is there any position in a supermarket where a disposition to racial violence could be considered to be an asset? At any rate, I hope they keep him away from the butchery, or just knives generally. Or perhaps it will be ok to sack him if he is not mentally ill, just a nasty piece of work?

As I said, Employment Law. To me, it’s crazy. And as the saying goes, just when you think you’ve reached the bottom of its craziness, you find there’s a crazy underground garage.

Time for this week’s song. You guessed it. Link here

As ever, Please do contact me and Louise whenever you need Notarial certification or Legalisation – at http://www.atkinsonnotary.com or phone me on 0113 816 0116 (internationally 0044 113 8160116)