Many LSVT Registered Providers (“RPs”) have come of age – or will soon be coming of age -after delivering their offer document promises. This provides RPs with the perfect platform to start to work towards a more mature, business like, relationship with their transferring council.
A potential hurdle to this fundamental development step is any outstanding financial liability owed to the RP by the councils under the stock transfer agreement. As part of the stock transfer process, councils provide various warranties and/or indemnities in favour of the RP; most notably dangerous substances, including asbestos. What steps can, and should, an RP take when a warranty is found to be inaccurate, or breached, or an indemnity limit reached?
Understandably, many RPs are reluctant to ‘rock the boat’ due to the need for a continued working relationship with their council on issues such as planning consent for planned development. However, can RPs realistically ‘look the other way’ when a potential claim exists with the consequential financial implications for the organisation?
Stepping out of a council’s shadow by bringing such a claim will inevitably cause some friction; however, the appropriate management of claims can ensure that a working relationship with the council is maintained.
With our substantial stock transfer and RPs governance experience we often advise upon, and manage, claims arising out of stock transfer warranties and indemnities. We work with clients to achieve resolution, ideally without having to start Court proceedings. In our experience, the majority of claims are settled by negotiation and/or mediation.
We have successfully negotiated settlements which include both a financial and non-financial element, the latter often seeming to be more valuable to RPs. This could include removing certain council management rights, amending the transfer agreement to enhance the RPs nomination provisions and financial payments in the event of asset sales.
Many stock transfer agreements now include warranties of 30 years duration from the date of transfer and as a result, RPs should actively review their transfer agreements to assess any breaches. Failure to claim for breaches within the standard 12 years limitation period will prevent an RP from successfully pursuing a claim.
If you wish to discuss your position, or suspect your council may be in breach of a warranty or indemnity please contact Hilary Harrison.
Next in our series of ebriefings on the Government’s Green Paper: Transforming public procurement; looking at the Chapter 4 proposal to change the basis of contract awards.
The Academies Financial Handbook is updated annually by the Department for Education and the Education and Skills Funding Agency; it contains a number of governance requirements for academy trusts.
Supreme Court publishes key decision for those working in the UK’s gig economy.
The 'Chocolate Snowman Appeal' is an amazing initiative that Anthony Collins Solicitors' (ACS) employees take part in every year.
The Building Safety Bill (the Bill) is said to be the most significant and wide-ranging change to the regulatory environment for higher risk building (HRBs) for over 45 years.
On 4 November 2020, the Restriction of Public Exit Payments Regulations 2020 (the Regulations) came into force; exit payments for the public sector were capped at £95,000.
The case was brought by the Official Receiver who sought disqualification orders under section 6 of the Company Directors Disqualification Act 1986 (CDDA 1986) against the seven trustees of Kids Company and its CEO. It illustrates well the tension between the role of a fulltime paid CEO of a large charity and the role of its board as voluntary trustees/directors.
At the end of 2020, The Charity Governance Code was updated or 'refreshed' as it is termed on its website.
Anthony Collins Solicitors is today (Thursday 11 February) revealing the scale of its social impact during 2020.
In their first podcast of this series, current and future trainees will discuss their journey and route to securing a training contract at Anthony Collins Solicitors.
To receive invitations to our events, as well as information and articles on legal issues and sector developments that are of interest to you, please sign up to Newsroom.