In House Lawyer seminar Thursday 25 April 2013 Birmingham 39 - PowerPoint PPT Presentation

In House Lawyer seminar Thursday 25 April 2013 Birmingham 39 Offices in 19 Countries

Welcome Nick Green 39 Offices in 19 Countries

Agenda 9.40am-10.10am In house lawyer perspectives 10.10am-10.30am Liabilities and associated business risks 10.30am-11.00am Economic update 11.00am-11.15am Tea and Coffee break 11.15am-12.00pm 5 minute legal updates on: • Social Media • Automatic Enrolment: New Employer Pension Duties • Environmental Compliance • Real estate • Employment legislation 12.00pm-12.30pm Facilitated discussions of key issues and networking 12.30pm Buffet lunch and close 3

5 key things you may not know about us Supporting clients in the region and beyond, for over 140 years One of the most global legal practices, with lawyers in 39 offices and 19 countries worldwide Top-20 global legal practice based on number of lawyers In 19 countries, 9th broadest global footprint Practicing law in more than 140 jurisdictions , in more than 40 languages, but speaking with one voice 4

In house lawyer perspectives Simon Best, National Grid 39 Offices in 19 Countries

Liabilities and associated business risks Vicky Wilkes 39 Offices in 19 Countries

Discussion Points • What do you need to think about before you pick up your pen? • Recap of key elements of a liability/exclusion clause, including current trends • Practical tips 7

What do you need to think about before you pick up your pen? Points to consider:  Value/Risk profile of the contract  Company policy?  Relative bargaining position 8

What do you need to think about before you pick up your pen? • Are you the supplier or customer? • Are there any particular/specific concerns? • Getting in first 9

Key elements of liability/exclusion clause What cannot be excluded?  d eath or personal injury caused by a party’s negligence  fraud or fraudulent misrepresentation  any matter in respect of which it would be unlawful to exclude or restrict liability – implied terms of good title, quiet possession, no encumbrances. 10

Direct or Indirect Losses • Contractual losses fall into two categories:  Direct Losses : losses, arising naturally, according to the natural course of things, from the breach of contract.  Indirect Losses : losses that may reasonably supposed to have been in the contemplation of the parties at the time they made the contract, as a probable result of the breach. A clause excluding loss of indirect and consequential loss including loss of profits, revenues, etc. is unlikely to be effective to exclude direct loss of profit, revenues, etc. Whether a loss is direct or indirect will depend on the circumstances in each case. 11

Direct and Indirect Losses An example: • GB Gas Holdings v Accenture (UK) Ltd & Others [2010] EWCA 912 • Defective supply of a new customer billing system resulting in claims (amongst other things) for: i) £18.7m excess gas distribution charges; ii) £8m ex-gratia compensation payments to customers; (iii) £2m additional borrowing costs; and iv) costs of replacement hardware/software. • Agreement excluded liability for “any losses, damages, costs or expenses whatsoever to the extent that these are indirect or consequential or punitive” (clause 16.2). It also stated that damages were only recoverable if Accenture did not promptly fix defects. • Held: Court of Appeal held that the above losses were direct losses and not indirect losses and therefore recoverable since they did not fall within these exclusions and common law damages were recoverable. 12

Limiting Liability Type of caps • property damage • general liability  “the [Supplier’s] total liability to the [Customer] in respect of ……….. shall in no circumstances exceed £[ ] for the entire term” 13

Limiting Liability Specific carve outs:  third party IP infringement claims  personal data/data security  o thers…….. 14

Trends • Explicit wording/repudiatory breach  Internet Broadcasting Corporation (t/a NetTV) v MAR LLC [2009]  Astra Zenica UK Limited v Albemarle International Corporation [2011] 15

Trends • Deliberate default/wilful misconduct  wilful misconduct may be reckless BUT deliberate default is not  deliberate default is a narrower concept than wilful misconduct  d rafting tip : use “wilful misconduct” rather than “deliberate default” • Statutory interest 16

Practical Tips…..Stop Press Kudos Catering (UK) Limited v Manchester Central Convention Complex Limited [2013]  Do not bury the exclusions  Deal expressly with repudiation – be specific 17

Practical Tips • A limitation rather than an outright exclusion is likely to be viewed more favourably by the courts. • Important that any liability clause is clearly drafted and expressly addresses all liabilities that it is seeking to cover. • Do not ignore standard exclusions of liability – it may make sense for some of the losses to be picked up in some way. • Check insurance – how much liability will be picked up by insurance? …..and remember…. 18

Economic update: Global, National, Regional Paul Forrest, West Midlands Economic Forum 39 Offices in 19 Countries

US$ 110.37 trn US$ 83.64 trn US$ 67.79 trn US$ 64.29 trn US$ 47.49 trn

Crisis Economies Eurozone Japan UK Economies Emerging from Crisis USA Strong Growth Economies ? Intellectual underpinning of austerity questioned

Regional Economic Motors? Russia Germany China USA Japan Nigeria India Indonesia Brazil Tectonic Plates of the Global Economy? Ignore BRIC concept & think Growth Markets 22

Regional Economic Motors? Tectonic Plates of the Global Economy? Ignore BRICs & think component compatibility

Regional Economic Motors? 24

Regional Economic Motors? * - Global Growth rate 2009-2035

Global Parameters – Business Trends Weaker performance forecast as investment boom falters – China Brazil Russia India Nigeria Indonesia Difficult transition from Middle Income to High Income Despite government shift in focus to domestic consumption Stronger performance in EU?

Global Parameters – Political Trends Political Cycle – fiscal restructuring in the US and Europe generational cycle in China, India & Saudi Arabia consolidation post-Arab Spring withdrawal from Afghanistan the impact of Shale Gas on US Energy policy & economic prospects for Poland and Ukraine.

US Gas Prices have fallen dramatically from the 2008 peak 80% of US energy needs now originate domestically (highest since 1991)

While Manufacturing has declined relative to GDP overall......

...............in absolute terms it continues to expand

The Midlands comparative advantages are in the sectors that recorded the strongest pre-crisis productivity growth

UK Domestic industry value added of gross exports global total: US$275 billion US$ million source: OECD 60000 50000 40000 30000 20000 10000 0 Direct domestic industry value added content of gross exports

Output growth has been sustained despite sectoral shifts – with real GVA growth rates comparable to national performance

West Midlands Economic Sectoral Structure 2011(p) Source: ONS & WMEF

In contrast to previous transitions from recession, the Midlands economic response has been firmer than other parts of the UK

International Competitiveness Productivity performance has kept pace with that of EU & North American competitors

International Competitiveness Struggling in the Premiership – policy mix to sustain competitiveness

The number of exporting companies reflects the strength of Innovation in the local economy & its inherent competitiveness

Markit West Midlands Export Climate Index 65.0 60.0 55.0 50.0 45.0 All West Midlands 40.0 EU West Midlands 35.0 Non-EU West Midlands 30.0 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Source: Markit Strengthening potential demand in the principal non-EU markets of the West Midlands

Markit West Midlands Export Climate Index 65.0 60.0 Spain 55.0 50.0 Italy 45.0 Russia 40.0 Irish Republic 35.0 Netherlands 30.0 France 25.0 Germany 20.0 China 15.0 United States 10.0 5.0 0.0 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Source: Markit Reinvigorated demand in key export markets

Employment take-up remains problematic, and reflects output capacity constraints as much as skills mismatch

Paul Forrest Director West Midlands Economic Forum mail@westmidlandseconomicforum.co.uk Tel: 0121 533 7130 Mob: 07738 324 517 www.westmidlandseconomicforum.co.uk West Midlands Economic Forum The Public, New Street West Bromwich, West Midlands, B70 7PG.

Legal Update: Social Media Ramez Moussa 39 Offices in 19 Countries

Social Media • Facts and figures • What are the issues? • What are the risks? • What are your action points? 49

Legal Update: Automatic Enrolment: New Employer Pension Duties Matthew Giles 39 Offices in 19 Countries