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Our Opinions

Brexit means Brexit?

Here is an interesting article.  All this goes to show that there are certain crucial matters where the will of the people is not taken up and blindly followed by their parliamentary “representatives” - they’re not delegates.

So where does this leave the Brexit vote? What force does it have? Well, the court in Miller & Others -v- The Secretary of State for Existing the European Union put it succinctly: 

“106. That Act falls to be interpreted in light of the basic constitutional principles of parliamentary sovereignty and representative parliamentary democracy which apply in the United Kingdom, which lead to the conclusion that a referendum on any topic can only be advisory for the lawmakers in Parliament unless very clear language to the contrary is used in the referendum legislation in question. No such language is used in the 2015 Referendum Act. 

107. Further, the 2015 Referendum Act was passed against a background including a clear briefing paper to parliamentarians explaining that the referendum would have advisory effect only. Moreover, Parliament must have appreciated that the referendum was intended only to be advisory as the result of a vote in the referendum in favour of leaving the European Union would inevitably leave for future decision many important questions relating to the legal implementation of withdrawal from the European Union. 

108. We emphasise that the Secretary of State's position on this part of the argument and the observations in the preceding paragraphs relate to a pure legal point about the effect in law of the referendum. This court does not question the importance of the referendum as a political event, the significance of which will have to be assessed and taken into account elsewhere.” 

I wonder why this was not explained at all during the referendum campaign? 

Come on MPs. Do the job that we pay you for.  Be leaders not followers.

More for less

It is often said that the challenge these days is to deliver more for less.  That is certainly a challenge for general counsel and their legal departments. This week the Gazette reported that GCs are continuing to shrink their law firm panels as they bring more work in-house and “after three years of steady increases, internal legal spend levels reached a 14-year high.  The problem is that “the task of managing law firms is an unwieldy, and labour- and time-intensive process” said Michael Rynowecer of the BTI Consulting Group.

The problem, all too often, with outside legal counsel is that costs are difficult to control and the direction of the case can also be lost, leading to decisions being taken which do not accord with GCs’ commercial goals. Better control and more efficient budgeting can often be gained by keeping the case in-house and flexibly increasing the size of the department during the period of need. 

Getting to yes

There is an old saying that a stitch in time saves nine, a variant on that, which highlights the consequences of failing to act is the proverb “for the want of a nail”. In the proverb each failure to act gives rise to more serious (and less foreseeable) consequences, culminating in the loss of the kingdom. 

In the context of disputes between parties the important essence is that a problem that is solvable if tackled early can become intractable if left to fester. So much so obvious, the real problem is finding a methodology that can consistently isolate future problems while they are inchoate. In the construction context the problem is magnified because of the numbers of individuals in the construction teams and the lack of access to all data.  This can mean it is akin to finding a needle in a haystack.

Smart technology is however beginning to ride to our rescue in that applications are being developed that can analyse large bodies of documentation detecting changes of tone in correspondence between parties that presage underlying problems, allowing early isolation of and concentration on those projects. Hence techniques first used in the marketing context to analyse consumers’ likes and dislikes are starting to be used to establish the degree of contentment of members of the project team, which can be an indicator of problems and delays starting to occur on the building. Once these problems are identified, effort can be directed to bringing the parties together, solving their problems and bringing the project to a successful conclusion.


Two strikes and you’re out!

 We recently highlighted the vast increase in court fees which the government has imposed on all litigants by the changes that took place on 9 March 2015 - some issue fees have increased by up to 600%. We remarked that one of the problems with this increase is that court fees can bear very little connection with the amount of court time on the case. That problem is particularly relevant to the construction industry.

The government had already privatised dispute resolution in construction following the original Construction Act in 1998, now it has imposed an effective double whammy by the current increases. The construction industry now pays private adjudicators rather than using the state’s courts, however should the paying party in that adjudication not pay, proceedings have to be issued to enforce the decision. Hence there has to be a summary judgement by a court, but not before the party who has just paid for his dispute to be adjudicated now has to pay again to issue a claim form for the sum in issue, and all for just one hearing!


Do not pass go…do not collect £200

On 9 March The Ministry of Justice increased the court fees that are payable to kick off the legal process, in some cases by up to 600%, whilst disingenuously claiming “we want to make sure that access to courts and tribunals is available to all”. Now if you have a debt claim for say £100,000 the fee to issue the claim form will be £5,000. The aim, apparently, is for fees to cover the full cost of court proceedings but if the case settles early, before much court time has been expended the initial issue fee will certainly overcompensate the exchequer. There is certainly a question of access to justice, and the Law Society has started a campaign seeking a review, however there is another lesson to take from this change. The civil justice system is increasingly not there to be the cure for your problems, seek to prevent problems for there is no cure via the law.

Towards a smarter tomorrow

Systems are getting smarter, but it is the conjunction of smarter systems with expert advice that really gives the best rewards.

Behind the scenes at some websites algorithms are at work. Depending on “click speeds”, time of day and cookie-generated previous history, the visitor is being monitored and categorised.  Without us knowing it the site is reacting to our assessed intentions. Are we potential buyers, window-shoppers or just lost? As the Economist reports “machine learning”, is at the core of the new world of business economics.

But it is not just website technology that is getting smarter, the ability to crunch the data and draw conclusions is relevant to business in general and construction projects in particular. We can now flag up to management when projects are going badly, even before the claims start flying. In that way problems are tackled early on, leading to a saving in management time and legal costs.

Your flexible friend

Incredible as it may seem the new iPhones sold over the weekend of their release in September 2014 contain 25 times more computing power than the whole world had at its disposal in 1995. That computing power is driving a change as profound as the original industrial revolution.  All over the world, young entrepreneurs are “appily” looking to provide on-demand services and products.  Why own a car when Uber and provide you with one at a moment’s notice, why cook your own dinner when you can get SpoonRocket to that for you? The same arguments that led to industrial specialisation within a company are being used for buying in those services from outside it. 

So it is said companies make sense when the cost of organising things internally through hierarchies, is less than the cost of buying things from the market; they are a way of dealing with the high transaction costs faced when you need to do something moderately complicated. In essence the company should concentrate on what it uniquely does best, buying in the peripheral services from a flexible market, and that is getting easier, and cheaper. Pfizer undertook an review discovering that its most highly skilled workers were spending 20% to 40% of their time on routine work. The company now contracts out much of that.

So the trade goes in both directions – contracting out and buying in.  Why employ and in-house counsel when you can buy in the service on a flexible basis?

Of resolutions not revolutions

And what have you done?

Another year over

And a new one just begun

Yes, it’s the time for New Year resolutions.  Personal ones, of course (lose weight, spend more time with your children… etc.), but also managerial ones. 

No doubt we all left for the Christmas break with a clutch of best selling guides to better management. The whole echelon has a life and lingo of its own, here today but gone tomorrow.  Whether it is Tom Peters’ “…excellent firms don't believe in excellence - only in constant improvement and constant change”, or John Kotter’sLeaders establish the vision for the future and set the strategy for getting there”, what actually works? What can you actually use long term in your business?

Perhaps there is a rapport here between the personal and the managerial. The trick may be to select a change that is not revolutionary, but rather, is sustainable, even enjoyable.  The goal should be to concentrate upon one thing that can be achieved and habituated.  Our favourite management saying is rather older than those above: “The journey of a thousand miles begins with a single step” (千里之行,始於足下) – Laozi (c604 b.c. - c531 b.c.).

A happy and prosperous New Year to you all!


The Interview – (not) coming to a cinema near you

Whoever it was that was behind ♯GOP’s hack on Sony Pictures sometime in late November, the act is testament to the old adage that information is power. 

It is not just the embarrassing tittle-tattle between movie execs about others in the industry that has fallen into the hackers’ hands, but also the myriad of other commercial and personal information that they now possess and may use in nefarious ways in the future.  As has been pointed out, Sony bears substantial responsibility for the current failure in its cyber security as it apparently left social-security numbers and salary data unencrypted, and stored passwords in a file conveniently entitled “Password”.

So what conclusions can you draw for your business, beyond the need for vigilance in the way the organisation deals with its cyber-security?  Well the wider point is that all information that your company possesses constitutes a powerful resource that you may not be making proper use of.  Information is power in the positive sense also.

All companies swim in a sea of law and regulation that is not often actively perceived by those that do business.  Avoiding elephant-traps can only be achieved by constantly, and pro-actively, applying legal analysis to the facts faced by the business.

Slow boat to Lima

Would I expend money to prevent a possible future catastrophe? Of course the problem is that if I do expend the money, and the dire future never occurs, I can never be sure that the prediction was right in the first place.

Nevertheless the nations of the world are focused on that very question. Slowly but surely they are inching forward, collecting data, creating hypotheses and experimenting. Above all they are bargaining.  Unfortunately the Lima communiqué notes that there is a still significant gap between the pledges to mitigate greenhouse gases and what is needed.  Indeed it was reported in the Times last Saturday that the Lima conference itself had a “vast carbon footprint” as the electricity for the event had in the end to be supplied from diesel generators - something of a PR disaster!

Nevertheless we have to hope that the “boiling frog” is not a correct analogy for our current state.  Prevention is always the least-cost option.

© Prima Facie Consultants Limited 2016 Legal