Tuesday, 21 September 2010

Foreign bankruptcies now enforceable

In a potentially ground-breaking case, the Court of Appeal has ruled that bankruptcy judgments made overseas can now be enforced through the UK Courts.

On 30 July, David Rubin & Partners, an insolvency practitioners, successfully convinced the Court that it should be allowed to enforce a bankruptcy judgment made in New York.

Adrian Roman and his two sons, from an office based here in the UK, set up a US company called Eurofinance SA. Relying on the relatively weak consumer protection legislation in the US, Eurofinance sought to scam American consumers out of millions of dollars. The idea was that consumers were given vouchers if they bought goods in certain shops. The vouchers could be used to get all their money back after three years. No-one ever actually got their money back. 15% of the purchase price of goods was paid into The Consumer Trust. However, the Trust only contained $9,000,000 whereas if all those who partook of the scheme successfully claimed back their money, the Trust would have to fork out $160,000,000.

In October 2007, the Trust was liquidated by the US Bankruptcy Court. Mr Roman had made approximately $8,000,000. David Rubin and Partners were appointed as liquidators. They sued Mr Roman. Mr Roman stayed in the UK under the impression that any bankruptcy judgment made against him in the US was not enforceable in the UK. At first instance, he was right. However, the Court of Appeal reversed this decision. Prior to the decision, it was possible to avoid liability established in foreign courts by remaining in the UK. No longer. It is a case which could have enormous ramifications. Over the next few months, it will be interesting to see the volume of cases in the UK which are based on foreign debts. It is a stark reminder of the care which must be taken by all those who conduct their business abroad and further evidence of how small the world is becoming.

If you have any query regarding this case or indeed any other insolvency matter, please do not hesitate to contact Duncan Wilks of this firm.

Thursday, 2 September 2010

ACAS Annual Report Reveals 13% Increase in Employment Claims

ACAS Annual Report Reveals 13% Increase in Employment Claims

ACAS, the independent employment relations service, have recently published their annual report and accounts for the 2009/10 period. The report provides an insight into the volume of disputes arising out of employment relationships.

ACAS reports that although the number of large-scale collective disputes being referred to ACAS has dropped, there was a 13% increase in the amount of individual employment claims totalling 87,421 for the year, 25% more than they were resourced to deal with. They also reported a drop in the overall rate of resolution indicating that more cases are proceeding to expensive tribunal hearings.

Over 45% of individual employment claims involved unfair dismissal, 10,000 more claims than the previous year, and more than 25,000 claims were made relating to discrimination on grounds of sex, race or disability. To put this in a financial context, the average awards made in 2008/09 ranged from £27,235 for Disability Discrimination to £7,959 in cases of Unfair Dismissal.

Whilst it is never possible to wholly prevent claims, the figures published by ACAS remind us of the fact that effective policies, procedures and employment contracts can save hundreds, if not thousands, of pounds defending claims. Employers need to ensure they are in the best position to mount a defence.

If you find that you are in need of advice about Employment Tribunal claims please contact our Head of Employment, Martin Williams