Parchment Winter 2015 by 256 Content

Parchment

Ireland’s Business to Business Magazine of the Year

the

DSBA.IE

D UB LIN SOLICITORS’ B AR ASSOCIATION MAGAZ INE | WIN TER 2015 | ISSU E 66

HELLO NEW WORLD How Will the Legal Services Bill Affect You?

LUCINDA CREIGHTON CROSS-EXAMINED 20 MINUTES WITH BREEN PURCELL

Parchment_Winter_2015_cover.indd 3

10/12/2015 14:15

TITLESOLV TITLE BONDS PROVIDING SOLUTIONS; PROPELLING THE PROPERTY MARKET

For information on how we can assist contact us at: Carmel Nielsen +353 (01) 633 8872 +353 (0) 87 299 8088 cnielsen@titlesolv.com www.titlesolv.com

Address Titlesolv, C/O Hannover Re, 4 Custom House Plaza, IFSC, Dublin 1

Titlesolv is a trading name of London & European Title Insurance Services Limited (Registered in England & Wales company number 4459633 VAT No. GB 709149918.) authorised and regulated by the Financial Conduct Authority and a member of the Hannover Re Group.

33515_Titlesolv FP.indd 1

24/11/2015 14:51

Winter 2015 dsba.ie

From the Editor

hristmas came early for the Parchment, when we were chosen as the winner of the best Business to Business magazine at the Irish Magazine Awards earlier this month. To win a national publishing accolade such as this, is a very ﬁne achievement and credit must go to everyone involved in this humble publication. This includes each and every one of the Parchment’s voluntary contributors and authors; the various DSBA committees and their chairpersons; the DSBA council; the Parchment committee and our publishers 256 Media and its team of professionals. The new Legal Services bill is due to be enacted in the coming weeks. The controversial legislation has seen several revisions since ﬁrst proposed by former Justice Minister, Alan Shatter and will see changes to our profession – hopefully all for the good. Keith Walsh has penned a piece on page 12 that sets out a summary of the key points to note. A particular focus for articles in this edition is the new Companies Act and its impact on transactions with directors and connected persons; the new

regime it has set for liquidators, and how a provision in the Act can affect security of cost applications in litigation cases. In this edition, we put the spotlight on Lucinda Creighton, TD; and Breen Purcell, solicitor and there are a host of other articles that will update you on different areas of the law. Our new DSBA President has hit the ground running and Eamonn Shannon promises to have a busy and event-filled year ahead. Can I wish you and your loved ones a peaceful and relaxing Christmas and here’s to a successful and healthy 2016 for one and all.

John Geary jvgeary@gmail.com

DSBA COUNCIL 2015/2016

EAMONN SHANNON DSBA President

AINE HYNES Vice President Chair - Mental Health and Capacity Committee

ROBERT RYAN Honorary Treasurer

ELAINE GIVEN Honorary Secretary

GREG RYAN Programmes Director Chair - Commercial Law Committee

DIEGO GALLAGHER Chair - IP and Technology Committee

TONY O’SULLIVAN Chair - Property Committee

JOE O’MALLEY Chairman of the Litigation Commitee

CAROL EAGER Chair of Commercial Law Commitee

SUSAN MARTIN Chair of Family Law Committee

VICKY PIGOT Chair - In-house Lawyers Committee

JOHN O’MALLEY

NIALL CAWLEY

LAURA HORAN Chair of Younger Members Committee

PAUL RYAN Chair of In House Committee

PUBLISHED BY The Dublin Solicitors’ Bar Association, 1st Floor, 54 Dawson Street, Dublin 2.

The DSBA, its contributors and publisher do not accept any responsibility for loss or damage suffered as a result of the material contained in the Parchment.

of an advertisement in the Parchment does not necessarily signify official approval by the DSBA, and although every effort is made to ensure the correctness of advertisements, readers are advised that the association cannot be held responsible for the accuracy of statements made or the quality of the goods, services and courses advertised. All prices are correct at

time of going to press. Views expressed are not necessarily those of the DSBA or the publisher. No part of this publication may be reproduced in any form without prior written permission from the publishers.

EDITOR John Geary PARCHMENT COMMITTEE Julie Doyle Stuart Gilhooly Áine Hynes Geradline Kelly Killian Morris Gerry O’Connell Kevin O’Higgins Joe O’Malley Keith Walsh COPYRIGHT The Dublin Solicitors’ Bar Association

DSBA OFFICE, T: 01 670 6089 F: 01 670 6090 E: maura@dsba.ie DX 212011 W: www.dsba.ie ADVERTISING ENQUIRIES Donal McDonald T: 01 707 6036

DISCLAIMER Advertisements are accepted at the discretion of the magazine which reserves the right to alter or refuse to publish any item submitted. Publication

WHEN YOU HAVE FINISHED WITH THIS MAGAZINE PLEASE RECYCLE IT.

the Parchment 1

001_Parchment_Winter_2015.indd 1

09/12/2015 14:54

Winter 2015

Contents 6

20 Minutes with...

New DSBA Council and Committees

Killian Morris talks to Breen Purcell of McDowell Purcell

I believe that now times are improving we will all be stronger, if a little battle weary from the experience, and will recognise the volatility of the business page 6

20 MINUTES WITH... BREEN PURCELL

New DSBA council and committees for 2015

How will new Legal Services Regulation bill affect solicitors? Keith Walsh considers seven effects of the revised bill

The DSBA Irish Book Awards The shortlist is announced for the DSBA annual book awards

New Deal for Tenants

The Truth about Lobbying

Landmark Decision for Family Law and Probate

Owen Burke examines the recent Government package aimed at helping tenants

Patrick Cagney reviews the new Regulation of Lobbying Act 2015 which heralds many changes

Keith Walsh reviews the recent High Court decision of D.C. v D.R.

Dublin Solicitorsâ&#x20AC;&#x2122; Bar Association 1st Floor, 54 Dawson Street, Dublin 2, Ireland T: 01 670 6089 E: info@dsba.ie W: www.dsba.ie

2 the Parchment

002-003_Parchment_Winter_2015.indd 2

06 09/12/2015 14:56

Winter 2015 dsba.ie

Contents

REGULAR FEATURES 01 Editor’s Note 04 President’s Message 54 News 55 DSBA Younger Members 57 Photocall 64 Closing Argument

44 32

New Regime for Liquidators John O’Malley examines the new statutory regime governing liquidators under the Companies Act 2014

Security for Costs – how much is enough? Mark Heslin reviews the amount of security a plaintiff may be required to provide in a litigation action

Cross Examination

Limited Liability for Solicitors - the Story Now

Stuart Gilhooly meets barrister and Dail deputy Lucinda Creighton, TD

Robert Ryan assesses the provision in the updated Legal Services Regulation bill as to limited liability partnerships for solicitors

The Value of Everything

Directors’ Transactions changed by Companies Act

Killian Morris and Adrian Power Kelly review recent legislation in the area of rating and valuations

Pauline Louth highlights the significant changes in the Companies Act 2014

Facebook – export of data must stop Greg Ryan takes a look at an interesting ECJ decision affecting Facebook and social media users

Lucinda Creighton cross examined the Parchment 3

002-003_Parchment_Winter_2015.indd 3

09/12/2015 14:56

Message from the President

New Year Ahead

was delighted to take over the presidency of the DSBA at our recent AGM and look forward to what promises to be a busy and productive year. For many of us the arrival of the winter edition of the Parchment marks the beginning of the run-in to the end of year holiday season and affords us an opportunity to reflect on what was achieved during the past year. It was a pleasure to serve as Aaron McKenna’s vice president and I would like to congratulate him on all that he achieved during his term. Under Aaron’s leadership, DSBA membership has grown, the overall costs of the association have been reduced and there was a smooth transition to our new premises at 54 Dawson Street. Aaron also hosted many successful events, including the Law Book Awards and a fantastic conference in Berlin culminating in a gala dinner at the Reichstag. This year the Parchment garnered worldwide recognition when the spring edition featured former DSBA President Stuart Gilhooly’s interview with Muriel Walls which won the Best Interview or Profile – Print or Digital category in the Content Marketing Awards. The interview was a profile of one of our most highly regarded family law solicitors and LGBT campaigner, Muriel Walls. The Parchment also won Business to Business Magazine of the Year at the Irish Magazine Awards 2015. I would like to thank our editor, John Geary, and his committee for their ongoing hard work and commitment which make the Parchment such a great success. I would also like to congratulate our task force on the submissions made regarding the Legal Services Regulation Bill which is due to be enacted before the end of this year. Many of these submissions will be reflected in the amendments to the original bill, including those relating to LLPs. Since the DSBA report on Limited Liability Business Structures was submitted to the then Minister for Justice in February 2009, the DSBA has been to the forefront of promoting the benefits of LLP and body corporate structures for solicitors to Government and I am pleased that LLPs

I would also like to congratulate our task force on the submissions made regarding the Legal Services Regulation Bill are now included in the bill. The DSBA will continue to promote the benefits of limited liability for sole traders which is not included in the new bill. We will, of course, keep our members informed and updated in relation to how the Act will impact on solicitor firms in practical terms, once the legislation is enacted. At the AGM I announced our intention to set up two new committees in 2016 – a

Banking and Funds Committee to represent the growing number of our members working in the banking sector and a Public Interest Law Committee. This committee will assess public interest legal issues that may be taken by members on a pro bono basis with a view to assisting those without the means to access and be represented in the justice system. I look forward to working with my fellow council members and would like to take this opportunity to formally welcome our new council members: Niall Cawley, Paul Ryan and Laura Horan. I would like to thank all our committee members for the precious time they give from their busy workloads and without whom we would not be the successful organisation that we are. Thank you all for your continued support of the DSBA in 2015 and I hope to see you at one of our seminars or events during the course of the next year. Finally I would like to wish you all a very Happy Christmas and every success for your practice in 2016. Eamonn Shannon, DSBA President

4 the Parchment

004_Parchment_Winter_2015.indd 4

09/12/2015 14:58

Advanced Legal welcomes Tiarnan Sparks as their latest addition to the Irish team. Tiarnan Sparks Account Manager –Advanced Legal, Block 4 – 5 Ushers Court, Ushers Quay Dublin 8. Mobile: +353 (0)86 130 1616 E: Tiarnan.Sparks@advanced computersoftware.com

Tiarnan is the first of a number of new staff investments, the result of continued business growth in the Irish market, increasing numbers of new clients and the introduction of our new legal software line ‘ALB’. Advanced legal General Manager for Ireland Jimmy Scullion has been tasked with increasing the client base across Ireland and introducing their next generation software ALB to their expansive client base. Jimmy is the first to admit that Law firms are still facing many difficult decisions, and with many options available picking the right business model will be key to future success. The firm has recently started recruiting new staff and are delighted that Tiarnan is settling in well, Advanced also have plans to increase local helpdesk resources. All of this investment is to support the introduction of their next generation software, ALB, to the Irish market. Jimmy says, “OPSIS is a good solution and will continue to serve the needs of our customers for many years to come. That said, many law firms are expanding and modernising, they want their systems to do more, they also want to invest in systems that are keeping up with the ever quickening pace of technology, e.g.: Windows 10, Cloud based platforms, this is where ALB will come into its own”. Jimmy also acknowledges that solicitors firms are still cost conscious, and as such Advanced Legal has come up with an attractive commercial investment package for existing OPSIS clients to help them make the move to the new more advanced system. ALB, a modern fully integrated Practice Management System, combines cutting edge technology with ease of use and provides everything a firm needs to improve productivity and grow in today’s competitive market. A number of recent CPD-accredited events have been held around Ireland, created to allow attendees the opportunity to consider how Case Management Systems could benefit their practice. These workshops also enabled attendees to preview the new ALB system and were attended by both existing and potential future clients. Advanced Legal have planned a number of CPD events for 2016, the first of which runs on 15th January in Dublin and Tiarnan would be more than happy to provide you with further information on upcoming events. About Advanced Legal Advanced Legal has over 30 years’ experience providing software to 5,000 law firms, barristers’ chambers and coroners’ offices in the UK and Ireland. Advanced Legal helps customers improve their overall partnership and chambers performance, specifically cash-flow and profitability. Its innovative and easy to use solutions help improve efficiency, increase income and make better use of data to enhance client service. More than 50,000 legal services staff use Advanced Legal’ s solutions every day, including: integrated chambers and case management (including workflow); electronic forms; customer relationship management (CRM); business intelligence, skills and resource management; document imaging; HR & payroll and mobile solutions. Advanced Legal forms part of Advanced Business Solutions, an Advanced Computer Software Group Limited company. In 2014, the Group won Tech Company of the Year in PwC’s UK Tech Awards. Advanced was also ranked in the Deloitte UK Fast 50, which recognises the 50 fastest growing technology companies in the UK and ranked in the top 300 technology companies in Deloitte’s EMEA rankings.

33576_Advanced Legal 1-2.indd 1

08/12/2015 15:10

Breen Purcell of McDowell Purcell Solicitors

6 the Parchment

006-009_Parchment_Winter_2015.indd 6

09/12/2015 14:59

Winter 2015 dsba.ie In conversation with Killian Morris of Amoss Solicitors

20 Minutes With...

Breen Purcell

Be a team player, a support to your colleagues and be willing to roll up the sleeves when necessary. The law is often not black and white, and being able to sound things out with your colleagues and peers is invaluable – and it works both ways

Breen Purcell is a founding partner of McDowell Purcell which has seen huge growth in recent years. He practises in the area of property and banking transactional work and has considerable experience in the financing, acquisition and disposal of commercial and residential property

When did you qualify? I qualified in 1994 having completed my traineeship in a mid-sized firm where I continued to work until we set up practice in 1998. If you hadn’t become a solicitor what would you have done? As a four-year-old apparently, I wanted to be a carpenter having played Joseph in the school play. However, much later in life I knew I wanted to do something that would allow me to be the master of my own destiny. Law was an area I found interesting and a profession that I thought would allow me to work for myself. I am happy to say that I have never had cause to regret that decision. Have you any funny anecdotes from your time as a trainee/apprentice? I have many, but few that are fit for print! On one occasion I remember being asked by my master to attend an investment property that he owned to feed some tropical fish, all in a day’s work! If we asked your best clients to describe

you – what would you expect/hope they might say? I would like to think that they would describe me as accessible, responsive and easy to communicate with. While sometimes it is necessary to adopt a tough stance on matters in order to protect your clients best interests, for the most part adopting a cooperative and respectful approach in dealing with colleagues ensures the best outcome. I enjoy my job and I hope that that comes across in my dealings with both clients and other solicitors. What was your most memorable moment in practice? Putting up our first plate with my fellow partners JP McDowell and Denis McDowell when we set up practice in 1998 was a proud (and scary) moment. We had rented rooms on Wellington Road, met with the bank, bought some second-hand office furniture and off we went with big ambitions. It was a good time to set up and we found a lot of goodwill out there. However, moving to our then new office in

the Capel Building (where we are currently located), was another one. We had lots of space to fill, and it really was a different challenge to us as a practice. Since then however, there has been no looking back. Your firm has seen huge levels of growth in recent years, was this by design or did it naturally evolve that way? It was always our ambition to grow the firm. Our managing partner, Thomas O’Malley has been very instrumental in seizing opportunities to bolt on additional practice areas that enhance the services we can offer to clients. Furthermore, we recognised the need to invest in business development and now have two full-time professionals working in this area. In the last three years alone we have seen McDowell Purcell double in size and we now number over 110 people. Of course that level of growth brings its own challenges, but we are fortunate to have an excellent team and a strong stable of clients who have grown alongside us. Who has had the most influence on your career and why? the Parchment 7

006-009_Parchment_Winter_2015.indd 7

09/12/2015 14:59

My fellow partners have been a very positive influence and continue to demonstrate great business acumen and ambition for the future of the firm. I would have to say that Denis McDowell, whilst now our consultant, was also very instrumental in bringing a levelheaded continuity to the practice over the years. Also I would have to acknowledge my parents, and especially my late mother’s influence in terms of never resting on your laurels, always striving to stretch yourself and looking forward to the next challenge, rather than relying on current successes. If you had the power to change something about how the legal profession operates, what would it be? In my area of property, the introduction of paperless conveyancing would be terrific. I battle on a daily basis, like many other property lawyers, to shift paper but it still keeps returning. I know massive strides have been made in this respect, but there is still a long way to go to before we are operating like other jurisdictions. Describe an event in your personal life which has had the most important impact on your development as a solicitor? If I am honest it was probably the recession; it was a very grounding event. Decisions had to be made, and of course there were worries. I believe that now times are improving we will all be stronger, if a little battle weary from the experience, and will recognise the volatility of the business. I certainly won’t

take as much for granted. Greatest Irish sporting memory? It would have to be the Ireland v England rugby match in 2007 at Croke Park. I was lucky enough to have a ticket for the match and I remember beforehand knowing that Ireland simply had to and were going to win that day. What would be your dream holiday? I love the outdoors and a certain number of outdoor pursuits. On my dream holiday I would love to go woodcock shooting in Kerry, followed by grouse shooting on the Scottish moors. I would then like to spend a month in the south of France with my wife, Dee and son, Rían and finish off with a trip on the Orient Express - totally refreshed for Monday in the office! Tell us something nobody knows about Breen Purcell? This summer I completed construction of a wood burning clay oven. Having never built anything before, I felt it was quite an achievement and it produced some great results – we’ll see if it lasts the winter weather. A transaction of note? Last year I had a client who, following reading an article in the news of a homeless mother and her children, instructed me to locate this lady, see where she wanted to live and buy a house in that area for her and her family to rent out at an affordable rate. This was in order to get her out of the hostel she was living.

As this was happening, my client, who wanted to remain anonymous to the lady, asked me to get short-term rental accommodation for her in the interim. In advance of her going into her new house my client had it fully furnished, and even left presents and notes from his young kids to hers upon arrival in their new home. It was a great moment handing over the keys and a great example of genuine, unrecognised generosity. I had the pleasure of conveying thank you notes from the young family back to my client who I recall became quite emotional reading them. It was a very rewarding matter to work on. Any advice for those entering the profession in 2016? Be a team player, a support to your colleagues and be willing to roll up the sleeves when necessary. The law is often not black and white, and being able to sound things out with your colleagues and peers is invaluable – and it works both ways. Don’t be afraid to ask lots of questions as a junior solicitor. As you progress up the ranks people will expect you to know the answers, so make the most of that window of learning as a newly qualified solicitor. Learn how an office works as a business from daily banking tasks to the broken photocopier. Being in practice is not just about working the files. Always be courteous to your colleagues because you never know… P

8 the Parchment

006-009_Parchment_Winter_2015.indd 8

09/12/2015 14:59

Winter 2015 dsba.ie Photography: Bryan Brophy and Bryan Meade

20 Minutes With...

the Parchment 9

006-009_Parchment_Winter_2015.indd 9

09/12/2015 14:59

DSBA Council & Committees 2015/2016 Council

Probate and Tax committee

IP & Technology committee

DSBA PRESIDENT: Eamonn Shannon VICE PRESIDENT: Aine Hynes TREASURER: Robert Ryan HONORARY SECRETARY: Elaine Given PROGRAMMES DIRECTOR: Greg Ryan Diego Gallagher Tony O’Sullivan Joe O’Malley Carol Eager Susan Martin Vicky Pigot John O’Malley Niall Cawley Laura Horan Paul Ryan

CHAIR: Trea McGuinness - Porter Morris Deirdre McDermott - Denis I Finn Aileen Hughes Courtney - Michael Sheil & Partners Finola O’Hanlon - O’Hanlon Tax Limited Orla Coyne - Eames & Company Sally de Foubert - Woods Hogan Ann Stephenson - Stephenson Solicitors Laura Delaney - Amoss Brian Broderick - O’Hanlon Tax Aoife McFadden - Oisin Nolan Solicitors

CHAIRMAN: Diego Gallagher Byrne Wallace Carmel Hynes - St John Solicitors Elaine Breen - IFG John Glynn - John Glynn & Co Sean O’Brien - O’Brien Ronayne John Healy - law agent, South Dublin County Council Greg Ryan - Greg Ryan Solicitors

Litigation committee CHAIR: Joe O’Malley - Hayes Solicitors VICE CHAIR: Darragh Lenehan Axa Legal Jessica Cantwell - Eugene F Collins Eamonn Carroll - National Treasury Management Agency Clifford Healy - Matheson Emma Keegan - Beauchamps Conor Lennon - AIB Plc Ailbhe Levingstone - DWF Conor MacGuill - MacGuill & Co. Kevin Dunne - Hayes Solicitors Rowena McCormack - DAC Beachcroft Emily-Jane McGuire - Kane Touhy Susan Martin - Martins Solicitors Barra O’Cochlain - John Glynn & Company Anne O’Connell - Sherwin O’Riordan Killian O’Reilly - McDowell Purcell Brian Ormond - McDowell Purcell Gerard Prendiville - Allianz Avril Scally - Lavelle Solicitors Valerie Shaw - National Asset Management Agency Jim Waters - Waters & Associates Emmet Whelan - Byrne Wallace Alisia Mulready - Aaron McKenna Solicitors James McMahon - St John Solicitors

Property Law committee CHAIR: Tony O’Sullivan - Beauchamps Marissa O’Keeffe - St John Solicitors Roisin Bennett - Reddy Charlton McKnight Jackie Buckley - Hayes Solicitors Mairead Cashman - Dublin City Council Martin Coleman - Arthur Cox Susan Cosgrove - Cosgrove Gaynard Solicitors Tom Davy - Mason Hayes & Curran Helen Flynn - Noel Smyth & Partners Aine Gleeson - Kane Tuohy Solicitors David Lane - Start Mortgages Sean Greene - Eversheds Aidan Marsh - Beauchamps Ronan McLoughlin - Gallagher Shatter Ethna Ryan - Partners at law Kenny McArdle - Byrne Wallace Elaine Given - Shannon & O’Connor Julie Doyle - Beauchamps

Family Law committee CHAIR: Susan Martin - Martins Solicitors Michael Sheil - Micheal Sheil & Partners Avril Mangan - Mangan & Co. Justin Spain - Justin Spain Solicitors Cliona Costello - McKeever Rowan Solicitors Jennifer O’Brien - Mason Hayes & Curran Kathy Irwin - Irwin Solicitors Diego Gallagher - Byrne Wallace Peter Doyle - Doyle Fox & Associates Peter Quinn - Sheridan Quinn Ruairi O’Brien - John C Walsh & Co

Commercial Law committee CHAIR: Carol Eager - William Fry Aisling Doran - Eugene F Collins Fergus Doorley - William Fry Gearoid Carey - Matheson John O’Malley - Avant Card Paul Ryan - Verizon Hugh Kane - Kane Tuohy Simon O’Neill - McKeever Rowan Laura Fannin - Hayes Solicitors Marie McGinley - A&L Goodbody Noreen Howard - DAC Beachcroft Edon Byrnes - LKG

Parchment committee CHAIR: John Geary - JV Geary Solicitors Aine Hynes - St John Solicitors Kevin O’Higgins - Kevin O’Higgins Solicitor Killian Morris - O’Riordan & Company Stuart Gilhooly - Hugh J Ward Solicitors Joe P O’Malley - Hayes Gerard O’Connell - Doherty Ryan Julie Doyle - Beauchamps Keith Walsh - Keith Walsh Solicitors Geraldine Kelly - Geraldine Kelly & Co

Mental Health & Capacity committee CHAIR: Aine Hynes - St John Solicitors VICE CHAIR: Joan Doran - Joan Doran Solicitor Katherine Kelleher - Comyn, Kelleher & Tobin John Costello - Orpen Franks John Neville - John Neville Solicitor

10 the Parchment

010-011_Parchment_Winter_2015.indd 10

09/12/2015 15:04

Winter 2015 dsba.ie

DSBA Council 2015-16

Eamonn Shannon DSBA President

Aine Hynes DSBA Vice President

Robert Ryan

Elaine Given

Greg Ryan

Diego Gallagher

Tony O’Sullivan

Joseph O’Malley

Carol Eager

Susan Martin

Vicky Pigot

John O’Malley

Niall Cawley

Laura Horan

Paul Ryan

Orla Keane - Arthur Cox Mark Felton - Felton McKnight & Co Nicole Dillon - Porter Morris & Co Ann Stephenson - Stephenson Solicitors Olive Doyle - Byrne Wallace

In-house committee members CO-CHAIRS: Paul Ryan - Verizon and Patrick Ambrose - Bank of Ireland Tara Glynn - ACC Loan Management Limited Pauric Heraghty - Axa Insurance Aine Burke - Chief State Solicitors Office David McSweeney - JTI Ireland Ltd Edel McCormack - Railway Procurement Agency Hugh Dockery - Chief State Solicitors Office Rita Crowley - Version 1

Criminal Law committee CHAIR: Richard Young - Sheehan and Partners Matthew Kenny - Sheehan & Partners Orla Keenan - Office of the Director of Public Prosecutions Lydia Leonard - Pensions Authority Tony Collier - Tony Collier & Co Mischa Hanahoe - ME Hanahoe & Co Andrew Vallely - Partners at law Colleen Gildernew - KOD/Lyons Solicitors Edward Bradbury - John Quinn & Co

Younger Members Committee CO-CHAIRS: Marguerite Seymour and Laura Horan Lisa Griffin - William Fry

Mona Deegan - Mason, Hayes & Curran Frances Flynn - Arthur Cox Kiara Daly - Morgan McKinley Catherine O’Callaghan - Eugene F Collins Ellen Chesser - William Fry Damian Kenneally - Eugene F Collins Ide O’Neill - LK Shields Sharon O’Connor - Matheson Jane Bourke - Gleeson McGrath Baldwin John Bollards - Patrick Donaghy & Co Solicitors Eoin O’Cuilleanain - William Fry Sarah Browne - LK Shields Michael Prior - Bailey Homan Smyth McVeigh Solicitors Gavin Bluett - Leman Solicitors Robert Upton - Gartlan Furey

the Parchment 11

010-011_Parchment_Winter_2015.indd 11

09/12/2015 15:04

How Will New Legal Services Regulation Bill Affect Solicitors? Former DSBA President Keith Walsh considers the revised bill and highlights the seven big ticket items that will concern practitioners

A The other major change since 2011 is that the Law Society will retain control of the solicitors compensation fund and its regulation of practice committee will not be abolished

t the time of writing the Legal Services Regulation bill has just been passed by the Seanad and only needs to be formally passed by the Dail [at this stage no more substantive amendments can be made], before it is signed into law by the President. The final Act will look nothing like the initial bill presented in 2011. The fundamental changes to the bill came about not so much due to the alleged success of the legal professions in their lobbying campaign, but because the initial bill was drafted in a hurry due to the pressure imposed by the Troika and was simply not fit for purpose. The DSBA, Law Society and the Bar Council lobbied for a more independent legal services regulatory authority, a fairer system of complaints handling and the introduction of limited liability partnerships for lawyers. The other major change since 2011 is that the Law Society will retain control of the solicitorsâ&#x20AC;&#x2122; compensation fund and its regulation of practice committee will not be abolished. What follows is the briefest of guides to the new Legal Services Regulation bill/Act (with consequent health warning) and a more detailed guide will follow in the spring issue of the Parchment.

Seven ways the Legal Services Regulation Act will affect solicitors 1. The end of self-regulation This bill is not the end of solicitors. It is not even the beginning of the end. But it is, perhaps the end of the beginning (to paraphrase Churchill). It is the beginning of the end of self-regulation and to some extent, the end of self-determination of the legal profession. Something important has been lost and while it may

only prove to be a symbolic loss, it is still a loss. This loss may be balanced by the gain of limited liability partnerships or by the introduction of an independent complaints system or a more transparent system of legal costs adjudication. The Legal Services Regulatory Authority will determine most important policy matters, but our independence can still be maintained by a strong input from the DSBA and other bar associations and the Law Society in debates on legal profession issues to the Authority, to the public debate and to Government. 2. More expense - we will pay for all the running costs associated with the new Legal Services Regulatory Authority- Quango alert The Legal Services Regulatory Authority will be funded entirely by a levy on legal practitioners â&#x20AC;&#x201C; both solicitors and barristers. The legal profession has been refused any veto or say on how much money is spent by the Authority or how it is spent. This will be a matter entirely for the Authority to decide and we will have no say, save through the nominees on the board of the Legal Services Authority. It is likely that solicitors will have to pay a levy to the new Authority in addition to their practising certificate fee to the Law Society which will be the body responsible for paying the levy on behalf of its members. The Authority has recently advertised for a CEO and will need to fund a board, staff, premises, IT infrastructure, the new complaints structure, the new disciplinary tribunal and a host of other expenses associated with a quasi-autonomous non-governmental organisation [QUANGO]. 3. Introduction of limited liability partnerships is a good thing and also likely to increase

12 the Parchment

012-013_Parchment_Winter_2015.indd 12

09/12/2015 15:07

Winter 2015 dsba.ie Keith Walsh is a former President of the DSBA and principal of Keith Walsh Solicitors

News

consolidation of law firms Limited liability partnerships will be introduced for solicitors and for ‘legal practices’ which are partnerships of barristers and solicitors or barristers and barristers. In order to operate as an LLP, the firm will have to be authorised by the Authority to do so. The DSBA lobbied for a separate category for sole practitioners but they were not included, so it’s likely that the introduction of LLPs as well as the changes to the run-off cover aspect of professional indemnity insurance will act as an inducement for an increased amalgamation of sole practitioners who wish to get the benefit of limited liability. 4. New and independent system for complaints against solicitors not to be cause of concern for practitioners as the system must be fair There will be an independent body dealing with complaints made against solicitors. Over 80% of complaints currently made against solicitors are resolved at a very early stage and the new system envisages a similar sensible method of examining whether complaints are admissible or vexatious before setting out a means of resolving complaints – and before the process becomes adversarial. The single biggest source of complaints against solicitors in the past five years which have resulted in findings of misconduct relate to breach of undertakings. There’s no reason to believe that the introduction of the new complaints handling system will result in an increase in the volume of these complaints [which in 2014/15 fell to 36% of the 2012/13 level, source – annual report of the Independent Adjudicator of the Law Society of Ireland, year ended September 30th 2015]. The Law Society retains its financial regulatory function. The compensation fund which is funded by solicitors will remain in place and payments out will be managed by the Law Society. 5. The Authority’s board decides the Authority’s policy and will have a majority of non lawyers The board of the new Authority will include 11 people, five of whom will be lawyers, one will be nominated by the Institute of Legal Costs Accountants and the other five will be non-lawyers. The DSBA lobbied in favour of the inclusion of a cost accountant on the board of the new Authority. The Law Society nominates two people to the Authority, the Kings Inns one, Bar Council one, the Legal Aid Board must nominate one solicitor. The non-lawyers are nominated by the Citizens Information Board, the Higher Education Authority, the Competition and Consumer Protection Commission, the Irish Human Rights and Equality Commission. The Government will appoint one of the lay members to act as chairperson of the Authority. 6. More rigorous rules in relation to estimating legal fees, especially in litigation matters The office of the Taxing Master will be replaced by the office of the Legal Costs Adjudicator. New and more onerous Section 68 type duties are placed on solicitors to set out clearly in writing (called a notice) as soon as reasonably practicable the legal costs that are likely to be incurred in relation to the matter concerned. Where the matter involves

litigation then a much more detailed estimate is required – comprised of both the work to be done and the estimate for each element of the work to be done – narrative and estimate. If the solicitor has not included a matter or item in the written notice of costs, then the legal costs adjudicator cannot allow the charge on taxation or adjudication, unless to disallow it would cause an injustice between the parties. Unlike the current position, a solicitor will be able to apply for adjudication of a bill of costs. Currently the client must sign a requisition to tax before the taxation can proceed. 7. The bill is only a work in progress, it is not the finished article Sections 17 and 19 of the bill dealing with nondisclosure of confidential information need to be strengthened as they are inadequate. The DSBA has been calling for changes to these sections since they were published in 2011 and we understood they would be amended some time ago. We await details from the Department of Justice and if these sections are not amended prior to the commencement of the work of the Authority, it is likely the Act will be subject to challenge as these sections appear to breach solicitor/ client confidentiality or legal privilege. There are a number of other matters that need to be tidied up in the bill and it’s to be hoped this will be done in early 2016. The bill is not a final version but rather a work in progress. The bill also makes provision for consultations/studies into the advisability of multidisciplinary partnerships, education of lawyers, the introduction of licensed conveyancers and the unification of the profession – so more change is likely following the setting up of the Authority. P the Parchment 13

012-013_Parchment_Winter_2015.indd 13

09/12/2015 15:07

Law Book Awards 2015 One of the many joys that December brings is the news of the nominations for the DSBA Law Book of the Year awards. This is the third year of the competition and so far we have been privileged with the quality of the books entered. And this year is no different. Only one single author has produced a book in each of the first three years and it will be no surprise to learn that author is Professor John Wylie whose entry this year is for Irish Landlord and Tenant Acts: Annotations, Commentary and Precedents. Professor Wylie won the Law Book of the Year Award last year with his definitive work on landlord and tenant law. Last year’s winners of the Practical Law Book of the Year award, the Arthur Cox

employment law team also maintain their form and make it three nominations in a row with their Employment Law Yearbook. The most recent DSBA award for outstanding legal scholarship was awarded to the editors (and co-authors) of Law and Government: A Tribute to Rory Brady, by Blathna Ruane, David Barnville and Jim O’Callaghan. Mrs Siobhan Brady attended the ceremony and the award was accepted by the editors and Mrs Brady on behalf of the late Rory Brady’s family and his memory as well as on behalf of the many contributors to the volume including Michael McDowell, Noel Whelan, Paul Gallagher, Hugh Geoghegan, Brian Murray, Paul Sreenan, Michael M Collins,

By Keith Walsh

Turlough O’Donnell and Donal O’Donnell. This year’s judging panel will announce a shortlist of books which will appear in the spring edition of the Parchment. In previous years we have been honoured that the Minister for Justice, Frances Fitzgerald and the DSBA President have hosted the awards and we wish to thank her and Aaron McKenna for their support over the last two years. Other great supporters include the publishers, Round Hall Thomson Reuters, Bloomsbury Professional, Blackhall Publishing and Clarus Press as well as our sponsors Byrne Wallace Solicitors, Peter Fitzpatrick & Co, Legal Costs Accountants and Law Society Skillnets.

Nominees for DSBA Irish Law Book of the Year

Damages Tadhg Dorgan and Peter McKenna, Round Hall Thomson Reuters, €265

Injunctions: Law and Practice, 2nd Edition Brendan Kirwan, Round Hall Thomson Reuters, €265

Medical Negligence and Childbirth Doireann O’Mahony, Bloomsbury Professional, €195

Easements, 3rd Edition Peter Bland, Round Hall Thomson Reuters, €265

The Law of Intoxication: A Criminal Defence Michael Dillon, Round Hall Thomson Reuters, €195

Equality Law in the Workplace Alastair Purdy, Round Hall Thomson Reuters, €150

Energy Law Raphael Heffron, Round Hall Thomson Reuters, €245

Freedom of Information Law, Maeve McDonagh, Round Hall Thomson Reuters, €285

Privacy & Data Protection Law in Ireland, 2nd Edition Denis Kelleher, Bloomsbury Professional, €195

The Law of Advertising in Ireland Patrick Ambrose, Bloomsbury Professional, €195

14 the Parchment

014-015_Parchment_Winter_2015.indd 14

09/12/2015 15:08

Winter 2015 dsba.ie

Book Awards

Keating on Probate, Fifth Edition Albert Keating, Round Hall Thomson Reuters, €325

The Law of Company Insolvency, 3rd Edition Michael Forde, Hugh Kennedy, Daniel Simms, Round Hall Thomson Reuters, €295

International Human Rights: Perspectives from Ireland General Editor: Suzanne Egan, Bloomsbury Professional, €150

The Law of Credit and Security, 2nd Edition Mary Donnelly, Round Hall Thomson Reuters, €345

Nominees for DSBA Practical Irish Law Book of the Year

The Solicitor’s Guide to Drunken Driving Marketing and Growing a David Staunton, Round Hall Business: How to turn your Thomson Reuters, €195 legal practice into a financial success Flor McCarthy, Thesolicitorsguide.com, €24.97

The Bloomsbury Professional Guide to the Companies Act 2014 General Editor Dr Thomas B Courtney, Bloomsbury Professional, €195

Irish Landlord and Tenant Acts: Annotations, Commentary and Precedents JCW Wylie, Bloomsbury Professional, €225

The Trade Union and Industrial Relations Acts Anthony Kerr, Round Hall Thomson Reuters, €125

Irish Income Tax 2015 Purcell McQuillan, Bloomsbury Professional, €199

The Companies Act 2014: An Annotation Brian Conroy/Crowe Horwath, Round Hall Thomson Reuters, €250

Arthur Cox Employment Law Yearbook 2014 Arthur Cox employment law Team, Bloomsbury Professional, €95

the Parchment 15

014-015_Parchment_Winter_2015.indd 15

09/12/2015 15:08

News

Photography: Paul Sherwood

Below: David Phelan

Below: Bobby Blakeney and Ciarán O’Rourke

Hayes Celebrates 175 Years in Business Dublin firm Hayes Solicitors passed a significant milestone in its long history this year. William Hayes set up his firm at Ormond Quay in 1840, only 10 years after the Law Society of Ireland was established, five years before the Great Famine and some 19 years before the first edition of The Irish Times

illiam Samuel Hayes, a future president of the Law Society (1906-1907) and Robert Hayes were apprenticed to their father’s firm in 1886 and became partners in Hayes & Sons in 1892, by which time the firm had moved to offices at Nassau Street. They were later joined in the partnership by another brother, Samuel. William Hayes died in 1899 but his sons built the practice and stayed in the firm for their entire careers. The 1950s was a significant decade for the firm as it settled into its new surroundings at 15 St Stephen’s Green, today home of the Little Museum of Dublin. The three Hayes brothers died during the 1950s leaving a wellestablished firm that included Thelma King who became a partner in 1956 – a rare female partner in those days in a profession that by 1960 had a mere 60 female practising solicitors in Ireland. (In 2015 Hayes has a 50:50 gender balance in its partnership.) Thelma King went on to become president of the DSBA in 1973-74, following in the footsteps of Hayes DSBA past presidents Ralph J Walker (1952-1953) and Leslie E Kearon (1958-1959). Hayes continues to play an active role on DSBA committees today. The firm moved to its current offices at Lavery House on Earlsfort Terrace in 1997. In 2003 Hayes & Sons became Hayes Solicitors and by 2008, incorporated both Fawsitt Solicitors and Eugene Davy Solicitors following successful mergers.

Hayes today has more than 40 solicitors including 16 partners and two consultants. At a reception to mark the firm’s 175th anniversary in November, managing partner David Phelan remarked that strong relationships with clients and staff have been a key feature of the long Hayes story so far and will continue to be its hallmark into the future. P

Above: Fiona White, Martha Wilson, Lisa Timmons

16 the Parchment

016_Parchment_Winter_2015.indd 16

09/12/2015 15:09

BEHAN

& ASSOCIATES

Legal Costs Accountants

LEGAL COSTS ACCOUNTANTS For over 50 years Behan & Associates have provided a comprehensive service to the Legal and Business communities. Our highly experienced team of Legal Costs Accountants provide an excellent standard of service, which covers every aspect of Legal Costs, to include: • High Court Litigation and Dispute Resolution • Commercial Court • Arbitration • Circuit Court • Administrative and Public Law • Tribunals • In-house seminars provided

Blanchardstown Corporate Park, Dublin 15. Tel: (01)8606000 Fax: (01) 8829647 Dx 207, Email: info@behans.ie www.behans.ie 32950_Behan & Associates.indd 1

08/12/2015 12:12

Abacus Law Costs For all your legal costs requirements

CCS House, 6-9 Trinity St, Dublin 2. T: (01) 612 7041 | F :(01) 612 7042 | E: info@abacuslawcosts.ie

www.abacuslawcosts.ie

33513_Abacus Law Costs.indd 1 A4 Full page.indd 1

07/12/2015 14:33 08/12/2015 17:07

New Deal for Tenants Owen Burke examines the recent Government package which aims to help tenants amid the current housing crisis

ll stakeholders in the housing and rental market will agree that the current situation which is exacerbated by lack of supply, is unsustainable. Up to 700,000 or so people now live in the private rented sector in this country which is a doubling from 10% of households to over 20% of households in the last decade. This equates to approximately 320,000 properties. Of this number, one third of those households are in receipt of some level of state subvention. By comparison with other European countries, social housing in Ireland makes up 9% of households compared to 31% in the Netherlands. As a result of the low amount of social housing available in Ireland, there’s considerable reliance on the private rented sector. The announcement by the Minister for the Environment, Community and Local Government, Alan Kelly, TD on November 10th last of ‘a new deal for tenants’ was welcomed to varying degrees depending on which side of the landlord and tenant relationship you were on. The Residential Tenancies (Amendment) (No. 2) Bill 2012 will amend the Residential Tenancies Act 2004 with the main changes being as follows: • An increase in the number of months before rent reviews for residential tenancies. • A legal obligation on landlords to notify their tenants of their rights at the time of rent review. • A deposit protection scheme whereby deposits are lodged with the Private Residential Tenancies Board (PRTB). • The provision of evidence by the landlord to the

tenant that the rent increases are in line with the local market rate. • Changes to the rights of landlords to terminate the tenancy in various circumstances. • Allowing for the enforcement of determination orders at district court level. • The introduction of a “slip or omission” rule for notices of termination. The bill is currently at committee stage in the Seanad. Since 2012 rental levels have increased substantially with Dublin rents rising by 9.2% per year and rents in the commuter counties also increasing, with the highest increases in Meath at 14.4% (Daft.ie Q2 2015 Report). Rent levels are getting close to their highest point which was reached in 2007 with statistics from the PRTB showing that Dublin rents are only 3.5% below 2007 levels. Given recent increases, it’s likely that the 2007 levels will be reached in the short term with average Dublin rents standing at €1,262 per month.

Rent Review Periods The most significant measure in the minister’s announcement is that from the date of enactment of the bill, rent reviews for all residential tenancies may only take place every 24 months. Under the current legislation, rent reviews can take place every 12 months. The new provisions will be subject to a sunset clause which will change the 24-month period back to a 12-month period in four years’ time. It appears therefore that the Government views this matter as a

18 the Parchment

018-020_Parchment_Winter_2015.indd 18

09/12/2015 15:10

Winter 2015 dsba.ie Owen Burke is a solicitor and trust and estate practitioner at Beauchamps Solicitors

Landlord and Tenant

tenancies of four years or more require a notice period of 112 days where the landlord terminates. The bill introduces further graduated increases up to a maximum of 224 days as set out in the table below:

temporary solution and it is to be hoped that normal functioning market conditions will return in the next number of years.

Notice of Rent Review A landlord will be required to give their tenant a minimum of 90 days notice as opposed to the 28day notice period which currently applies. When the landlord is notifying their tenant of a new rent, they must provide the notification in a particular format and they will be required to provide information to the tenant in relation to the tenant’s rights under the dispute resolution procedures through the PRTB. Supporting information must accompany the notice including information in relation to the rents of three similar dwellings in the area. One wonders how a landlord is to know this information and whether it will be acceptable for a landlord to provide evidence from websites such as Daft.ie. Landlords are required to notify the PRTB of an increase in rent within one month and this provision will remain. Landlords will be required to submit a signed statement by the tenant that they have been made aware of their rights and have been provided with the supporting documentation in relation to market rents. One wonders what the landlord’s rights will be if a tenant refuses to sign such a statement.

Notice Period for Tenancy Terminations The bill will introduce further notice periods for tenancies longer than four years. Under the table in Section 66 of the Residential Tenancies Act 2004,

By comparison to other European countries, social housing in Ireland makes up 9% of households compared to 31% in the Netherlands

5 years or more but less than 6 years 6 years or more but less than 7 years 7 years or more but less than 8 years 8 or more years

140 days 168 days 196 days 224 days

Extended periods for termination by the tenant will apply for tenancies over two years in duration.

Termination of Tenancies Under Section 34 of the Residential Tenancies Act 2004, there are six grounds set out in the table contained in that section which provide for the termination of a tenancy by a landlord. The bill will amend this table to provide that a landlord will have to explain in a written statement to the tenant why a property might no longer be suitable for the tenant’s accommodation needs having regard to the number of beds, size and composition of the tenant’s household. A landlord will have to make a statutory declaration where it is their intention to sell a property or where the property is to be occupied by the landlord or a member of the landlord’s family. Where the landlord proposes to change the use of the property, a copy of the planning permission must be provided to the tenant. The rationale behind these amendments is to further protect tenants from so called unscrupulous landlords who are using the existing provisions to terminate tenancies. the Parchment 19

018-020_Parchment_Winter_2015.indd 19

09/12/2015 15:10

Tenancy Registration

Notices of Termination

In future, the PRTB will be notifying both landlords and tenants of the registration of the tenancy. The parties will be advised of their rights and obligations and of the dispute resolution procedures available through the PRTB.

Solicitors who have acted for landlords will also be aware of the very strict rules in relation to the format and content of notices of termination. The legislation will be amended in Section 64A to provide that a slip or omission shall not of itself render a notice of termination invalid provided it does not materially prejudice the notice and the notice is otherwise in compliance with the Act. This is to be welcomed.

Deposit Protection Scheme Amendments to Section 12 and the insertion of new sections 135A and 148A-148Q will require landlords to lodge tenancy deposits with the PRTB at the same time they are registering their tenancy. And the PRTB will hold these deposits for the duration of the tenancy in a designated tenancy deposit account. The deposit will be repaid to the tenant at the end of the tenancy if the landlord agrees. Where there is no agreement between the landlord and tenant as to how the deposit is to be repaid, the matter will go to the PRTB for dispute resolution. One can imagine this being an administrative nightmare for all parties to tenancies and a further level of bureaucracy for landlords to have to deal with. It is to be hoped that if such provisions are introduced, sufficient resources will be given to the PRTB to administer this scheme. Inevitably there will be administrative delays in getting deposits back to tenants in genuine cases.

Enforcement of PRTB Determination Orders Any solicitor who has had cause to act on behalf of a landlord will know that the enforcement of a PRTB determination order is intolerably slow. The legislation will be amended so that determination orders can in future be enforced in the district court as opposed to the circuit court. However, given recent changes to jurisdiction limits in the district court, it is to be hoped that sufficient resources will be given to the district courts to process these additional enforcement actions.

Mortgage Interest Relief Under existing rules, a landlord is entitled to deduct 75% of their mortgage interest as an expense against their rental income for income tax purposes. To encourage private landlords to rent their properties to tenants in receipt of State social housing supports, such as rent supplement, a landlord will be allowed to deduct 100% of their interest as an expense provided that the accommodation is available for a minimum of three years and the tenancy is registered with the PRTB. Registration with the PRTB is an existing requirement to claim mortgage interest relief and this does not change in the new legislation. However, the three-year period is a substantial change and the benefit of the relief will be provided to the landlord on a retrospective basis after the three-year period has ended, and where necessary certification is provided to confirm that the terms of the scheme were met. These changes will be introduced in the Finance Bill 2015. One can see the rationale behind the three-year period but it appears unfair to only allow the landlord the full deduction after the three-year period has elapsed. In other tax incentives and reliefs, the relief is available immediately but there are clawback provisions if the provisions of a particular relief are not met, for example, agricultural relief or business relief under the capital acquisitions tax legislation. P

20 the Parchment

018-020_Parchment_Winter_2015.indd 20

09/12/2015 15:10

33562_Finders International.indd 1

24/11/2015 14:48

The Truth about Lobbying Patrick Cagney provides an overview of the new Regulation of Lobbying Act 2015 which heralds many changes

he Regulation of Lobbying Act 2015 (“The Act”) was signed into law by President Michael D Higgins on March 11th 2015. The Act establishes a web-based register of lobbying which will be maintained by the Commission for Standards in Public Office (“SIPO”). The key objective of the Act is the making of information available to the public on the identity of those who are communicating with Government and senior civil servants on public policy matters. Lobbyists are now required to register their lobbying activities on the publically available Register of Lobbying. The aim of the Act is not to restrict submissions and opinions on policy making or legislation, but rather to bring about significantly greater transparency and access to this process for the public. The web-based register was launched on May 1st 2015 with potential lobbyists asked to begin registering from this date. The Act commenced on September 1st 2015. The Act requires that persons engaged in lobbying activities are to register such activities on the public register. A registered person must make three returns per year setting out any activities that they have engaged in over the previous four months. Details provided should include to whom the lobbying was made, the subject matter of the communications and their intended results, and also the name of any person who is or has been a designated public official employed by, or providing services to, the registered lobbyist. The first returns must be submitted by January 21st 2016, with the next date in 2016 being set at April 21st 2016. On a practical note, the register itself is straightforward to navigate both in terms of registering as a lobbyist, and submitting a return. The information to be supplied is not exhaustive. However, it is important to be aware of any activities which are being carried out that may be captured by the Act. An internal assessment of the organisation’s objectives may be necessary when considering registering as a lobbyist, and what returns to submit. In terms of persons who are seeking to register, it may be helpful to appoint one individual who will take responsibility for the submitting of returns, as well as maintaining the profile of the organisation.

What is Lobbying? Section 5 of the Act outlines that the act of lobbying

will be considered to have taken place when a “relevant communication” has been made to a “designated public official” in respect of a “relevant matter”. A person is considered to be lobbying if they are: a professional lobbyist being paid to communicate on behalf of a client; an employer with more than 10 employees where the communications are made on the employer’s behalf; a representative body with at least one employee communicating on behalf of its members and the communication is made by a paid employee or office holder of the body; an advocacy body with at least one employee that exists primarily to take up particular issues and a paid employee or office holder of the body is communicating on such issues, or any person communicating about the development of zoning of land.

What is a Relevant Communication? Section 5 (4) of the Act considers a relevant communication to mean a communication made either personally or indirectly to a public official. This appears to be without exception to the nature of the communication, meaning that approaches made in formal correspondence will be treated the same as casual exchanges that may take place in person or at meetings or otherwise. In this respect it will be important to inform employees within an organisation of their responsibilities regarding “relevant communications”, and how it will be captured by the Act.

What are Relevant Matters? A relevant matter is outlined in Section 5 (9) which refers to the initiation, development or modification of any public policy or of any public programme; the preparation or amendment of an enactment; or the award of any grant, loan or other financial support, contract or other agreement, or of any licence or other authorisation involving public funds.

Who are Designated Public Officials? Designated public officials are set out under Section 6 and they include Government ministers and ministers of State, members of Dáil Eireann and Seanad Eireann, members of the European Parliament for Irish constituencies, members of local authorities, certain

22 the Parchment

022-023_Parchment_Winter_2015.indd 22

09/12/2015 15:14

Winter 2015 dsba.ie Patrick Cagney is a trainee solicitor with ByrneWallace

Public Law

public servants and senior officers in other prescribed bodies. Furthermore, the Minister for Public Expenditure and Reform has made regulations (the Regulation of Lobbying Act 2015 (Designated Public Officials) Regulations 2015) which provide that any persons in positions in the Civil Service in respect of which the maximum salary is €110,014 (non PPC) or €115,576 or higher (PPC) are prescribed as designated public officials. In relation to local authorities, the Minister for Public Expenditure and Reform is preparing regulations which will provide that any persons in positions at local authorities in respect of which the maximum salary is €100,238 or higher, are prescribed as designated public officials. This will bring the following local authority grades within the scope of the Act: chief executive officers and equivalent grades, and directors of services and equivalent grades. If there’s any doubt about whether a certain person (or organisation) is considered a designated public official under Section 6 of the Act, a detailed list of public bodies and officials can be found on the Lobbying.ie.

Information for Public Bodies It’s not just organisations and individuals that carry out lobbying activities that have certain requirements under the Act. Public bodies and individuals also have specific responsibilities. Section 6 (4) outlines that all public bodies under the Act must publish up-to-date lists showing the name and relevant grade, and brief details of the role or responsibilities of each person employed by, or holding any office or other position in the body who is a designated public official by virtue of the Act. In order to ensure that persons involved in lobbying can do so transparently and in compliance with the Act, it is important that public bodies provide such details to enable the full functioning of the Act.

Cooling-off Period The Act provides that certain designated public officials are restricted from being engaged in lobbying in certain circumstances for one year after they leave their employment or office. This has been described by SIPO as a “cooling-off” period in respect of involvement in particular lobbying activities. The designated public officials concerned are ministers of State, special advisers to ministers and ministers of State and prescribed public servants, as set out in Section 22 (2). Other designated public officials who for the purposes of the lobbying registration requirements are not covered by this provision include: TDs and senators who are not ministers or ministers of State, MEPs and local authority members, former or current public officials employed by or providing services to a lobbyist. The Act requires that persons engaged in lobbying activity on behalf of a lobbyist and who were at any time a designated public official to be named in returns on the Lobbying Register. Section 12 of the Act provides that if you are or were a designated public official (regardless of before or after the passing of the Act), and are employed by or providing

services to a lobbyist, and were engaged in lobbying communications during a relevant reporting period, then your name is required to be included in a return for that period and your name will appear on the Lobbying Register.

Regulation and Non Compliance The Standards in Public Office Commission will act as the regulator, and will monitor and maintain the Register of Lobbying website. SIPO will oversee the implementation of the register monitor compliance, provide guidance and assistance, and where necessary investigate and pursue breaches of legal requirements in due course. As set out in Section 16 of the Act, SIPO may produce a code of conduct for persons carrying out lobbying activities with a view to promoting high professional standards and good practice. The provisions in the Act dealing with offences and penalties are set out in Section 20 of the Act, though not yet in force. Once the provisions have commenced, the following will be considered to be criminal offences: lobbying without registering; failing to file a return with SIPO; providing information to the SIPO that is misleading or inaccurate; or obstructing a SIPO investigation. The penalties will include a fine of up to €2,500 and/or imprisonment for a term of up to two years. If convicted of an offence, the offending person will also have to pay the costs incurred by SIPO in bringing the criminal prosecution. Finally, it is worth noting that there’s currently no provision in the Act (or communication from the regulator) requiring persons engaged in lobbying to state publically on their own website that they are registered and compliant with the Act as there is with the charities’ regulator. Registering on the Register of Lobbying website and the proper submissions of returns will suffice. P

The aim of the Act is not to restrict submissions and opinions on policy making or legislation, but rather to bring about significantly greater transparency and access to this process for the public

the Parchment 23

022-023_Parchment_Winter_2015.indd 23

09/12/2015 15:15

Awards

Team Parchment! Left to right: Gerry O’Connell, John Geary, Stuart Gilhooly, Maura Smith, DSBA President Eamonn Shannon and Keith Walsh

The Parchment scoops Top Accolade at IMAs The DSBA and the Parchment were celebrating at the recent Irish Magazine Awards (IMAs) after scooping the ‘Business to Business’ Magazine of the Year for 2015

he awards ceremony took place at the Chocolate Factory, Dublin 1 on December 3rd. The hilarious Barry Murphy of Apres Match fame (aka Gunter) was the host for the evening. The judging panel of the IMAs had shortlisted the Parchment for four nominations – Stuart Gilhooly in the highly coveted category of Journalist of the Year (which Stuart won in 2011) and editor of the Parchment, John Geary was shortlisted for Editor of the Year. In addition to the Business to Business Magazine of the Year category shortlisting, the Parchment was also nominated for the Front Cover of the Year. In awarding the Parchment the winner of the Business to Business Magazine of the Year - the judges said in their citation: • Redesigned with distinctively appealing covers. • Excellent editorial approach to selecting interviewees. • An all-round interesting read with a high standard of content. The organisation who run the IMAs, Magazines Ireland, represents 42 Irish publishers who together produce over 200 magazines, both consumer and business-to-business titles. P

Gunter (aka Barry Murphy) interviews John Geary and Stuart Gilhooly after the impressive Parchment win

24 the Parchment

024_Parchment_Winter_2015.indd 24

09/12/2015 15:15

MMCA michael mccabe & associates

ARCHITECTURE • PLANNING • DEVELOPMENT • CONSULTANTS Mapping ➢ PRA Approved (First Registration) ➢ Pre-Purchase Building Surveys Survey & Testing ➢ Pyrite(I.S. 398 Part 1 Reactive Pyrite) • ➢ Boundary Surveys ➢ Planning Compliance Energy Rating Certificates. ➢ Building (Commercial & Domestic)

www.mmca.ie

email: info@mmca.ie

tel: (087) 2452637

33636_Michael McCabe.indd 1

07/12/2015 14:40

LEGAL COSTS ACCOUNTANTS

expedient

expert secure

McCann + Associates provides an all-inclusive, expert and confidential Legal Costs Accounting service to the Legal Profession, the insurance sector and State Agencies. We are a result-driven team of Legal Costs Accountants with 95 years collective experience and supported by specialised staff. Our nationwide service includes, Drawing and opposing Bills of Legal Costs in all matters, written advices, telephone advices, general consultancy, on-site file inspections, Taxations/ Objections/Reviews/Appeals/Arbitrations/Tribunals.

McCann + Associates Legal Costs Accountants - 11 North Street Business Park - Swords, Co Dublin - DX 91010 Swords

PHONE: 01 840 7069

33511_McCann & Associates 1-2 page.indd 1

A4 Full page.indd 1

FAX: 01 840 7183

EMAIL: info@mccann.ie WEB: www.mccann.ie

12/11/2015 16:02

07/12/2015 17:26

Landmark Decision for Family Law and Probate Keith Walsh looks at the recent High Court decision of D.C. v D.R. which gives guidance on the issue of cohabitants and “proper provision” under Section 194 of the Civil Partnership and Certain Rights and Obligations of Cohabitants Act, 2010

he recent decision of Baker J in the High Court case of D.C. and D.R. [2015] IEHC 309 delivered on May 5th 2015 is useful to both family law and probate law practitioners. It concerns the application of section 194(1) of the Civil Partnership and Certain Rights and Obligations of Cohabitants Act, 2010 (the 2010 Act) which came into force on January 1st 2011. Unlike marriage or civil partnership there’s no registration for cohabitants; the law applies to cohabitants or qualified cohabitants automatically although there is a necessity to apply to the courts for redress. Section 194(1) permits a qualified cohabitant to apply for financial provision from the estate of the deceased cohabitant. In this case the relationship lasted until the death of the cohabitant but it is also possible, in more limited circumstances as set out in section 194(2) to seek provision from the estate of the other where the relationship had ended prior to one of the cohabitants’ deaths.

The Facts The plaintiff DR (the surviving cohabitant) claimed to be in an intimate cohabiting relationship with JC (the deceased) who died intestate on August 7th 2014. He had been in a previous marriage which was annulled and he had no children. The deceased never married and had no children. He sought provision from her estate. The defendant DC (the personal representative) was one of JC’s three brothers and her personal representative having

extracted letters of administration on December 3rd 2014. She had no sisters. The surviving cohabitant is 64, a farmer and horse trainer. The deceased was 69 when she died and worked as a school secretary. They met in 1994 and the surviving cohabitant’s case was that they became intimate in 1995, entered into a committed relationship after 1996 when the deceased’s mother passed away. The deceased inherited land from her mother which was sold in 2005 and she received €3.1 million after tax. From 1996 to 2004 he lived with the deceased for two or three nights a week at her home in K House. On the day his mother died in 2004 he moved in with the deceased and lived there until the deceased passed away. They shared an interest in horses and the surviving cohabitant was an acknowledged expert. The deceased was diagnosed with cancer in 2009 and recovered but the disease returned in 2013. The surviving cohabitant looked after her during her illness and it was acknowledged that he had done his best for her.

The Legislative Framework: What Constitutes Cohabitation? Baker J considered whether the surviving cohabitant had established that he was a cohabitant within the meaning of s. 172 of the Act. In this case he must prove that he lived together with the deceased in “an intimate and committed relationship”(section 172(1).

26 the Parchment

026-030_Parchment_Winter_2015.indd 26

09/12/2015 15:16

Winter 2015 dsba.ie Keith Walsh is a former President of the DSBA and principal of Keith Walsh Solicitors

Section 172 (2) sets out: “In determining whether or not two adults are cohabitants, the court shall take into account all the circumstances of the relationship and in particular shall have regard to the following: (a) the duration of the relationship; (b) the basis on which the couple live together; (c) the degree of financial dependence of either adult on the other and any agreements in respect of their finances; (d) the degree and nature of any financial arrangements between the adults including any joint purchase of an estate or interest in land or joint acquisition of personal property; (e) whether there are one or more dependent children; (f) whether one of the adults cares for and supports the children of the other; (g) the degree to which the adults present themselves to others as a couple.” The court must take into account all the circumstances and the list above is not an exhaustive one. Section 172(5) defines qualified cohabitant as: for the purposes of this part, a qualified cohabitant means an adult who was in a relationship of cohabitation with another adult and who, immediately before the time that that relationship ended, whether through death or otherwise, was

Family Law/Probate

living with the other adult as a couple for a period: (a) of two years or more, in the case where they are the parents of one or more dependent children, and b) of five years or more, in any other case.

Facts in Dispute The facts in dispute in this case related to whether the cohabitants in this case enjoyed an ‘intimate friendship’ or merely a friendship and there was also disagreement between witnesses as to whether the couple lived together. Baker J applied the facts of this case to the law as follows: Were the parties living together for five years or more? Baker J accepted the evidence of the surviving cohabitant that he took up full-time, permanent residence in the home of the deceased on the day his mother died in 2004. Was the relationship committed and intimate? Section 172(3) states that for the avoidance of doubt a relationship does not cease to be an intimate relationship for the purpose of this section merely because it is no longer sexual in nature. This indicates that in order to be an intimate relationship it must, at some point, have been sexual in nature. Baker J accepted the surviving cohabitant’s evidence that he and the deceased started an intimate sexual relationship in 1995 and this continued until shortly before the deceased’s death.

Unlike marriage or civil partnership there is no registration for cohabitants, the law applies to cohabitants or qualified cohabitants automatically although there is a necessity to apply to the courts for redress the Parchment 27

026-030_Parchment_Winter_2015.indd 27

09/12/2015 15:16

Baker J stated that inherited property and property acquired before the relationship commenced and independently of any direct or indirect contribution of the other, must be treated differently to property acquired in the course of the relationship whether in joint or sole names The perspective and state of mind of the deceased Baker J took into account evidence from other witnesses confirming the surviving cohabitant was in the deceased’s bedroom when they visited the house and the honourable judge took this to mean that it was unlikely he would have been in the bedroom of the deceased, had they not been in an intimate and committed relationship given the deceased’s private nature. The age and upbringing of the deceased may also have indicated that she would not publicise the nature of the relationship to the neighbourhood or to her family. The basis on which the couple live together S.172(b) Baker J clarified her view of the statutory test of the “basis” on which a couple live together. She states this is a broad test and encompasses much more than financial or property arrangements which are specifically dealt with in subs (c) and (d) of s. 172 (2). The basis of a relationship involves a number of interconnected elements such as: • the degree of shared activities that persons enjoy, such as shared meals, especially evening meals and breakfast, shared activities, shared division of household chores and shared holidays. In this case she found that the couple did live together in a committed relationship which was illustrated by the degree of contact that they had with one another on a day-to-day basis which was very frequent. The couple phoned and exchanged text messages with one another very frequently during the normal working day. Baker J held that they shared a joint interest which they both enjoyed and both spent time on the other’s farmland for all to see. 172(1) (g) Presenting as a couple Baker J when examining this factor stated ‘while expressions of physical affection in public might in some cases be a mode by which a couple show their intimate and committed relationship to the world’, this is not always the chosen means by which a couple present themselves. 172(2)(c) and (d) Financial dependence and interdependence [‘relationship cost’] When examining this factor Baker J held as a matter of fact that this couple were not financially dependent

for the basics of life, but that a degree of financial dependence had come to evolve between them with regard to certain elements of their personal and social spending. The degree of this was such as to suggest a relationship of shared commitment. Other circumstances of the relationship – the funeral arrangements or ‘rituals of death’ as indicative of the role The funeral arrangements were made by the surviving cohabitant and he was prominent at the funeral. General comments on inherited property and property acquired before a relationship commenced Baker J stated that inherited property and property acquired before the relationship commenced and independently of any direct or indirect contribution of the other, must be treated differently to property acquired in the course of the relationship whether in joint or sole names. This does not mean inherited property is automatically excluded from the ‘pot’ but it does mean it is not immediately included and this is more so when there are enough other assets to make provision. Conclusion on cohabitation – the test to be applied Baker J in applying the 2010 Act viewed the seven identified factors in s. 172(2) not as conclusive as to the nature of the relationship but as indicative of that relationship and how it is to be properly characterised. She set out as the test for cohabitation to be adopted by the court is: ‘to determine whether a reasonable person who knew the couple would have regarded them as living together in a committed and intimate relationship, and that the individual and many factors in how they are perceived must be taken into account’. She held that the surviving cohabitant was a qualified cohabitant and had lived with the deceased in an intimate and committed relationship since his mother’s death in 2004.

Provision from the Estate Section 194(7) of the Act states that the total provision from the estate of a deceased cohabitant cannot exceed the share to which the person would have been entitled if they had been married or in a civil partnership. On intestacy in this case a surviving spouse would have been entitled to 100% of the estate and if there had been a will, then the legal right share of a spouse would have been 50% of the estate.

Reward for Good Behaviour Baker J considered that she must take account of the attention paid by the surviving cohabitant to the deceased in her last illness and this good behaviour ‘positively supports the application of the plaintiff ’.

Conclusion on Provision – Weighing up the Factors

Degree of financial dependence not essential for provision Baker J held that while s. 172(2)(e) required the

28 the Parchment

026-030_Parchment_Winter_2015.indd 28

09/12/2015 15:16

is now THE BEST VALUE newspaper in Ireland for

NOTICES STARTIN FROM O G €100 NLY

LEGAL, PLANNING & LICENSING NOTICES

SO WHY NOT CALL US FOR A QUOTE ON 01-499 3414 FAX 01-409 8393 OR EMAIL LEGAL@THESTAR.IE

33555_The star 1/2.indd 1

24/11/2015 14:47

LAND REGISTRY MAPPING & BER CERTIFICATION SPECIALISTS l l l l l l

Land Registry Compliant Maps from €200+VAT 650 Land Registration Maps produced yearly 2,000 Commercial & Residential BER Certs issued annually Qualified team of Architects & Engineers registered with SEAI & Engineers Ireland Prompt Efficient Service Full PI Insurance

COMMERCIAL ENERGY RATINGS LTD

Unit 3, Churchtown Business Park, Churchtown, Dublin 14. t: 01-2983000 e: info@cerl.ie www.cerl.ie

33558_Commercial Energy Saving - 1-2 page.indd 1 A4 Full page.indd 1

24/11/2015 14:40 08/12/2015 17:06

court to look to the degree of financial dependence for the purpose of ascertaining whether a couple are cohabiting, such financial dependence is not essential in the case of a claim for provision from an estate. She held this to mean that in a case where relatively little financial dependence or interdependence can be shown, the court may still make provision for a surviving partner provided the court is satisfied that the lack of financial interdependence or dependence did not signify a lack of commitment, and in the light of the provisions of section 173(3). Baker J held that while it is the case that provision may be made under section 194, even when financial dependence is not shown, the degree of financial needs must inform: 1. The extent of provision that the court will make, if any. 2. The extent to which the court will displace an interest of a beneficiary. Baker J took account of the following individual factors: The duration of the relationship: the deceased and the plaintiff were in a committed and intimate relationship for 20 years or thereabouts, they were cohabiting or de facto cohabiting for almost the entire of that period, since the mother of the deceased died. The basis on which the couple lived together: the deceased and the surviving cohabitant each made substantial and important contributions to the welfare of the other during the currency of their relationship. The degree of financial dependence: a degree of financial dependence arose by virtue of the significant discrepancy between the surviving cohabitant’s income and financial resources and those of the deceased. The degree of companionship and commitment: Baker J considered that the degree of companionship and commitment that the surviving cohabitant and the deceased had to one another led to their enjoyment of a very full social life, and she held that to deprive the surviving cohabitant not merely of the company of his long-term cohabitant, but also of some of those activities which gave him pleasure, such as membership of a sports club, membership of a golf club, meals out and holidays, while they might not be as enjoyable for him without her company, are still activities from which he can be expected to continue to derive pleasure, and which it would now in the view of Baker J be unreasonable to expect him to have to forego merely for absence of resources. Baker J held that the income of the plaintiff was not sufficient for his needs. There were no other persons in respect of whom the deceased had any obligation to provide financially. Baker J held that the interests of the beneficiaries who will succeed on her death intestate may best be achieved by making provision for the surviving

The most important factors underlying the provision allocated were provision of accommodation and income to meet the surviving cohabitant’s needs

cohabitant of less than the entire estate, leaving the balance to her brothers. Baker J held that the surviving cohabitant ‘was or became dependent upon the deceased for his accommodation needs’ and that ‘provision can be made for the plaintiff out of the estate of the deceased other than by awarding him the entire of her assets, partly because of the value of the estate and because the estate comprises in the main of real property, some of which is income producing. I consider that I may properly respect the interests of the brothers of the deceased by awarding them the balance of the estate and this also takes account of the fact that the assets of the deceased could broadly speaking, be said to be inherited.’ The surviving cohabitant’s financial situation: he owned an inherited farm which produced a small income. Baker J noted his age and the impossibility of him now taking up another form of employment or of turning his own farm to provide more income. She considered that he has long since foregone the possibility of making investments for himself or of being in a position to purchase a house in which he might live, and that this difficulty has arisen because he was persuaded by the deceased to live with her and not to build or buy a home for himself. It would be unreasonable to suggest that he might now sell his farm. The farm was valued at €1.446 million to include outhouses and yard but there was no dwelling house. Intention of the deceased to provide for the surviving cohabitant: Baker J held that the deceased ‘undoubtedly intended to make provision for the plaintiff ’.

The Result The surviving cohabitant was granted provision of approximately 45% of the estate. This 45% was to be achieved by vesting in him the two investment properties and their contents. The family home of the deceased cohabitant remained with her brothers. On the reason for this percentage Baker J stated: ‘The percentage arose more from the value of the separate assets and because I consider it to be possible and proper to make provision by a distribution of real property in specie. A greater or less percentage might be appropriate in another case, and I do not regard that the legislation mandates or permits of a rule or even a rule of thumb that directs a particular percentage, or range.’ The most important factors underlying the provision allocated were provision of accommodation and income to meet the surviving cohabitant’s needs. Baker J also took into account that the surviving cohabitant did not have a pension which was a future need, and it was now too late for him to make his own pension provision.

Conclusion This judgement should encourage cohabitants to enforce their rights under the 2010 Act. The award could be considered generous for a cohabitant case but is difficult to fault the application of the law to the facts of this particular case and so it will set a reasonably high benchmark for provision in cohabitant cases to come. P

30 the Parchment

026-030_Parchment_Winter_2015.indd 30

09/12/2015 15:17

SHOULD YOU HAVE USED ENKI? WWW.ENKI.IE NEW ONLINE CLOSING SEARCH ✔ Registered and Unregistered Properties ✔ Instant Hassle free Service ✔ Innovative, Transparent User Friendly Process ✔ Fully bonded 6.5million per case ✔ Free Monitoring Service ✔ Updated in Real Time

Special introductory offer for Registered Property closing searches for €50 +VAT when you mention The Parchment 53 Dawson Street, Dublin 2, Ireland Phone: 01 488 0990 Fax: 01 488 0992 Email: info@enki.ie Web: www.enki.ie

32496_ENKI.indd 1

07/12/2015 14:32

Kildare

Toronto London

Limerick

Vancouver

Sydney

Boston

New York

Auckland

Dublin

As Seen On IFTA Nominated RTE Series, ‘Dead Money’

Massey & King is the only incorporated firm of specialist Genealogists & Probate Researchers in Ireland.

Paris

Oslo Canberra

Christchurch Rome Prague

Birmingham

Delhi

Dallas

Cousin

Uncle

Aunt

Nephew Brother

Sister Deceased

www.masseyandking.com tel: (01) 492 8644 email: info@masseyandking.com

31880-Massey & king.indd 1 A4 Full page.indd 1

07/12/2015 14:36 08/12/2015 17:05

New Regime for Liquidators John O’Malley examines the new statutory regime governing liquidators under the Companies Act 2014

For the first time in Irish law there are now minimum requirements for those wishing to act as liquidators in the context of corporate insolvency

ractitioners will be aware that the Companies Act 2014 (‘the 2014 Act’) ushered in a new era of company law, consolidating (for the most part) pre-existing company law in one iteration, and bringing with it far reaching changes for those involved in the governance of Irish companies and their advisors. In addition to these changes, two apparently innocuous and little-known sections of the 2014 Act introduce for the first time in Irish company law, a statutory regime governing those who wish to act as liquidators in Ireland. Sections 633 and 634 of the 2014 Act provide for the qualifications governing those who wish to act as company liquidators. These sections, for what they seek to introduce, seem somewhat light on the detail as to how the ends sought to be achieved by their provisions, will be so achieved. In summary, the categories of those individuals who will be entitled to act as company liquidators are: • Solicitors holding a practising certificate • Prescribed accountancy body members holding a practising certificate (e.g. CAI, ACCA, CIMA members etc) • Members of other professional bodies recognised by the Irish Auditing and Accounting Supervisory Authority (IAASA) • Persons qualified under the laws of another EEA State and • Persons with practical experience of windings-up and knowledge of relevant law who have applied to IAASA to act as liquidators. Accordingly, for the first time in Irish law, there are now minimum requirements for those wishing to act as liquidators in the context of corporate insolvency. (In addition, it is worth noting that section 519(1) of the 2014 Act states that “a person shall not be qualified to be appointed or act as an examiner of a company unless he or she would be qualified to act as its liquidator”.) As far as solicitor liquidators are concerned, the Law Society now has statutory responsibility for the supervision of those of its practising members who wish to conduct liquidations in Ireland. Whether this new statutory responsibility makes any material difference in

real terms to the regulation of solicitor liquidators so far as the Law Society is concerned remains to be seen, for in truth, the Law Society will continue to regulate its members as before, including those solicitors who also happen to conduct liquidations.

Regulation of Liquidators by IAASA On its face, IAASA has been afforded significant new responsibilities vis-à-vis those individuals who are neither practising solicitors nor practising prescribed accountancy body members but who wish to conduct liquidations. In this regard, the intention of the 2014 Act appears to be that such (hitherto) unsupervised individuals would be ‘grandfathered’ from a regulatory perspective, and thereby ultimately fall under IAASA’s supervision. The 2014 Act affords IAASA with statutory responsibility for: (i) receiving and granting applications from persons with “practical experience of windings-up and knowledge of relevant law” (ii) prescribing regulations for the amount and terms of professional indemnity cover for all liquidators (iii) granting recognition to professional bodies (other than the Law Society or the prescribed accountancy bodies) who may in turn grant liquidator authorisations to its members. Persons with practical experience of windings-up and knowledge of relevant law Section 633(1) states that “... a person shall not be qualified for appointment as a liquidator of a company unless he or she falls within a paragraph of the table to this section.” The fifth paragraph of the table to Section 633 (entitled ‘person with practical experience of windings-up and knowledge of relevant law’) makes reference to a category of individuals who may conduct liquidations after having applied to IAASA to act as a liquidator. The grounds for being granted liquidator status by IAASA are that the individual concerned: • has obtained adequate relevant experience of the winding-up of companies and knowledge of the law

32 the Parchment

032-033_Parchment_Winter_2015.indd 32

09/12/2015 16:01

Winter 2015 dsba.ie John O’Malley is legal counsel with AvantCard. He is a council member of the DSBA

applicable thereto or • has practised in an EEA State as a liquidator. The foregoing provisions seek to ensure that individuals who are not already practising solicitors, prescribed accountancy body members, members of other professional bodies recognised by IAASA or persons qualified under the laws of another EEA State would fall under IAASA’s regulatory remit. Individuals who apply to IAASA to be authorised to conduct liquidations may continue to act as liquidators pending the determination of those applications by IAASA. Such persons must apply to IAASA for such authorisation within two years of the commencement of the section – i.e. two years from June 1st 2015. In this regard, IAASA has published a consultation paper regarding the receiving of applications from and granting authorisation to persons with “adequate relevant experience of the winding-up of companies and knowledge of relevant law”. Readers should visit IAASA’s website for further information in this regard, Iaasa.ie. Pending the determination of this consultation, should an applicant wish to make a preliminary application to IAASA as a person “with practical experience of windings-up and knowledge of relevant law”, IAASA will accept such applications in the interim. Such applicants are required to complete a preliminary application form and pay an interim application fee of €500 to IAASA. It is important that any liquidator who is not already a member of the Law Society or a prescribed accountancy body and who wishes to continue to conduct liquidations would make such an application immediately. If they do not, their ability under law to continue to conduct liquidations comes into question. Professional Indemnity Cover Section 634(1) of the 2014 Act gives the IAASA responsibility for prescribing the amount and terms of an indemnity (professional indemnity cover), without which a person cannot act as liquidator. This appears to apply to all liquidators, regardless

Commercial Law

of which professional body they belong to, including solicitors. Whilst the IAASA has engaged in a public consultation on the amount and terms of indemnity against losses and claims arising in respect of the civil liability of liquidators, to date the IAASA has not prescribed the amount and terms of such an indemnity. Recognition of Professional Bodies Finally, by virtue of the table to Section 633, the IAASA would appear to be afforded responsibility for recognition of professional bodies who may in turn grant liquidator authorisation to its members. To date, no such professional bodies have been recognised by the IAASA.

Conclusion Whilst the 2014 Act has ensured that the area of regulation of liquidators now falls within the statutory responsibility of certain bodies, how that regulation will manifest itself in terms of those conducting liquidations in Ireland, particularly those who are not already members of professional bodies, remains unknown. The Law Society and the prescribed accountancy bodies will no doubt continue to regulate their members who wish to act as liquidators, just as they have done prior to the introduction of the 2014 Act. However, it remains to be seen from a practical perspective how those liquidators who are not members of any professional body will be regulated by the IAASA in terms of regulations, codes of practice, codes of conduct, etc. It is fair to say that while the two sections of the 2014 Act governing the new statutory regime are big on the what in terms of what is sought to be achieved, they appear surprisingly scant on the how, particularly on how the changes are to be introduced from a regulatory perspective. For example, the issue of how persons qualified as liquidators under the laws of another EEA State and who wish to conduct liquidations in Ireland are to be regulated, and by whom, remains to be seen. Finally, all liquidators will await with bated breath the regulations governing the statutory indemnity insurance (required for all liquidators) to be prescribed by IAASA.

the Parchment 33

032-033_Parchment_Winter_2015.indd 33

09/12/2015 16:01

Security for Costs – how much is enough? Mark Heslin looks at approaches taken by the superior courts as to the amount of security a plaintiff may be required to provide in a litigation action

n Ticket Generator Limited v Dublin Airport Authority Plc & Ors. [2012] IEHC 216, Laffoy J made the following observation:

“Like so many aspects of the law, the jurisdiction conferred on the court in relation to ordering that security for costs be given and fixing the amount of the security is a mire of lacunae and anomalies.”

The ‘One Third Rule’ In the seminal decision in Thalle v Soares [1957] IR 182, the plaintiff and the defendant were, according to the High Court “persons of lowly stations and they have their homes in New York State.” In the Master’s Court, the defendant claimed that his costs would be somewhat in excess of £3,000, whereas the plaintiff argued that a true estimate was just under £1,800. The master fixed the amount of the security at £2,500, being “midway between the two figures put before him”. The plaintiff appealed to the High Court, claiming the sum was excessive. In rejecting the plaintiff’s appeal, the High Court cited, with approval, comments by Mr Justice Dixon in Gibson v Coleman [1950] I.R. 50 where he stated: “I can find no support for the view that the amount to be fixed should be less than a fair and reasonable computation of the costs to which he would probably be put in defending the action.” In the Supreme Court, Kingsmill Moore J disagreed with the lower court’s approach. Having reviewed the authorities, his Lordship could find only one case “where

security was ordered for the full amount of estimated costs”. In reducing the sum to £1,000, his Lordship made reference to the Court’s discretion with regard to fixing the amount and relied on his own experience of: “the practice which has prevailed in Ireland from 1919 until recent years, wherein it was customary to require as security an amount not more than about a third of the costs which would probably be incurred by the defendants.”

Well Established Practice Over three decades later, in Fallon v An Bord Pleanala [1992] 2 I.R. 380, the Supreme Court (Hederman J) expressed the following view: “… to depart from the well established practice of ordering a sum of one third of the estimated costs to be incurred by the party against whom security has been granted, as a prerequisite to proceeding with his case, the court would have to be satisfied on evidence that the interest of justice could only be served by increasing the amount for security for costs to a sum substantially in excess of one third of the costs to be incurred.”

Section 390, Companies Act 1963 In Lismore Homes Limited (in receivership) v Bank of Ireland Finance Limited & Ors. [High Court, March 24th 2000] McCracken J had to determine what “sufficient security” was in the context of an application made under Section 390 of the Companies Act, 1963. That section provided: “Where a limited company is a plaintiff in any action or other

34 the Parchment

034-036_Parchment_Winter_2015.indd 34

09/12/2015 15:19

Winter 2015 dsba.ie

Litigation

Mark Heslin is a partner at Beauchamps Solicitors

legal proceeding, any judge having jurisdiction in the matter, may, if it appears by credible testimony that there is reason to believe that the company will be unable to pay the costs of the defendant if successful in his defence, require sufficient security to be given for those costs and may stay all proceedings until the security is given.” The phrase “sufficient security” has considerable pedigree, having previously appeared in Section 278 of the Companies (Consolidation) Act, 1908 and in Section 69 of the 1862 Companies Act.

“Sufficient Security” In a departure from the one-third rule, Mr Justice McCracken held that the word “sufficient” meant sufficient for the costs of the defendant if successful in his defence, stating: “Where the court orders security for costs to be given in other circumstances, such as where the plaintiff is out of the jurisdiction, it is customary to require security of approximately one third of the probable costs. I do not see how under any circumstances this could be called “sufficient security”, and I think this section can only mean that the security required must approximate to the probable costs of the defendant should he succeed.”

Order 29, RSC As practitioners will be aware, where a plaintiff is resident out of the jurisdiction, an application for security can be made under Order 29 of the rules of the superior courts, which refers to “security” not “sufficient security”. In

The practice which has prevailed in Ireland from 1919 until recent years, wherein it was customary to require as security an amount not more than about a third of the costs which would probably be incurred by the defendants Harlequin Property (SVG) Limited & Anor. v O’Halloran & Anor. [2012] IEHC 13, the High Court looked at two specific issues, the first of which was: “Whether, given that the order for security for costs made was under Order 29 rather than under s.390 of the 1963 Act, it is appropriate to follow the common practice in orders made under Order 29 to direct security at one third of the total amount of costs estimated as being likely to arise.”

Corporate plaintiffs – foreign and Irish In relation to the amount of security which a foreign company should be ordered to provide, Clarke J felt that the Parchment 35

034-036_Parchment_Winter_2015.indd 35

09/12/2015 15:19

an analysis of the jurisprudence:

The court may depart from the so called “one third rule” and while a decision from the superior courts, specifically in relation to Section 52 of the 2014 Companies Act, would provide welcome clarity, the one-third rule remains the touchstone

“… seems to me to support the view that the justice of an application for security for costs under Order 29 made against a corporate foreign plaintiff should lead to that corporate foreign plaintiff being required to put up the same type of security as an Irish corporate plaintiff would have to… I am satisfied that it is appropriate to approach the fixing of security on the facts of this case on the basis of full security rather than by the application of the one third practice.”

The One-Third Rule Restated The same question which Judge Clarke addressed in Harlequin came before Laffoy J in Ticket Generator. Despite describing the underlying rationale of the Harlequin decision as “compelling”, Laffoy J felt obliged to take a different approach in light of the Supreme Court’s decision in Framus Limited & Ors. v CRH plc & Ors. [2004] 2 I.R. 21 which, she observed, had not been drawn to the attention of Clarke J at the hearing in Harlequin. Laffoy J’s analysis of the ratio of the Supreme Court’s decision in Framus and her approach to the quantum of security was as follows: “…in determining the amount of the security for costs under the court’s jurisdiction, which is now governed by the rules, the objective is to achieve a balance between the parties. That balance is reflected in the one-third rule, although a different approach may be warranted on the facts of a particular case... Although the matter is anything but “black and white”, with a considerable degree of diffidence, I have come to the conclusion that this court is bound to adopt the approach taken in Thalle v Soares, as explained in the Framus case, and to apply the one-third practice as to the amount of security ordered, notwithstanding that the order for security is against a limited company incorporated outside the State, unless there are special circumstances indicating that it should be departed from. I find no such special circumstances in this case.”

Discretion to depart from the rule On July 8th 2015, the Court of Appeal gave judgment in Flannery & Anor. v Walters & Ors. [2015] IECA 147. In the High Court McGovern J had made an order for the full amount of what he determined to be a reasonable estimate of the cost. Finlay Geoghegan J commented as follows in relation to the approach taken: “In my judgment, the trial judge was correct in his conclusion that the Supreme Court judgments collectively do not limit his discretion to depart from the so called “one third rule” where, as on the facts herein, he has determined that a limited company registered outside the jurisdiction but within the EU should give security on the basis of inability to pay the costs of the defendants.”

Companies Act 2014, Section 52 Section 52 of the 2014 Companies Act (which came into effect on June 1st 2015) repeats the wording previously found in Section 390 of the 1963 Act, but without the word “sufficient”. Nor is that word to be found in Order 29. Given this legislative change, a defendant who argues that the entirety of their likely costs should be ordered as security, arguably faces a greater challenge.

Conclusion It appears to be settled law that, in an appropriate case, the court may depart from the so called “one third rule” and while a decision from the superior courts, specifically in relation to Section 52 of the 2014 Companies Act, would provide welcome clarity, the one-third rule remains the touchstone. Meanwhile, the comments by Fitzgibbon J made almost a century ago in Perry v Stratham [1928] I.R. 580 would seem to be equally relevant today: “It must be borne in mind that security is not intended either as an indemnity against all costs which may be incurred or as an encouragement to luxurious litigation…”. P

36 the Parchment

034-036_Parchment_Winter_2015.indd 36

09/12/2015 15:19

33186_ Vision-net.ie .indd 1

09/12/2015 16:11

IS THIS YOUR COPY OF THE PARCHMENT? ARE YOU ON OUR MAILING LIST?

If not, please contact Maura Smith. Dublin Solicitors Bar Association, 1st Floor, 54 Dawson Street, Dublin 2, Ireland.

Tel: 01 670 6089 â&#x20AC;¢ E-Mail: info@dsba.ie Update your personal details online at:

www.dsba.ie Is this your copy-Filler full page.indd 1

Untitled-2 1

09/12/2015 14:46

09/12/2015 16:13

Rebel with a Cause As the Government’s five-year term comes to an end, one politician has experienced more turbulence than a Cessna in a hurricane. The rollercoaster career of Lucinda Creighton is headed for another revolution but whether it is up or down, it certainly won’t be gentle. As she leads her new party to the polls, she talks to Stuart Gilhooly about giving up the law, standing her ground and getting back into bed with Enda

ucinda who? Two words you’re unlikely to ever hear. Along with other Irish one-name protagonists, Lucinda has joined Enda, Roy, Bertie and Miriam as a moniker that requires no surname. In just eight years she has gone from being anonymous to the best known female politician outside of the Tanaiste. And while the Marmite cliché is overused, it does seem to apply here. She divides opinion like few others and it’s clear she both engenders loyalty in some and drives others to their daggers. In the last few months while the Government has been engaged in a phony war with the opposition over election dates, there has been a tendency to dismiss Renua, the new party and vehicle for Creighton’s ambition, almost as also-rans because of poor poll numbers. The inclination has been to lump them in with the large raft of independents and assume that they will make up the numbers when the results are in. This is to

We currently have three seats and I think it’s reasonable to suggest that we could bring in ten seats minimum

underestimate Lucinda and history tells us this is unwise. When we meet, she is predictably friendly in a breezy and uber-confident way. Conversation is easy and answers are typically forthright, but when I question the number of seats her new party may take up in the election, her eyes flash with a steely determination and a mild degree of hurt. Would she be happy with three, four or maybe five? “Ten, 15, 20. We’re pursuing at least one in every constituency. We currently have three seats and I think it’s reasonable to suggest that we could bring in ten seats minimum.” If that was the case and assuming that Fine Gael and Labour don’t exceed 70 seats between them, then Renua could hold the balance of power. Would she kiss and make up with Enda Kenny after such a public falling out or would her well-publicised principles disallow such a union? “We are preparing and are prepared for

38 the Parchment

038-041_Parchment_Winter_2015.indd 38

09/12/2015 15:21

Winter 2015 dsba.ie Stuart Gilhooly is a partner at HJ Ward & Co Solicitors and former President of the DSBA. He has won a number of journalistic awards for his writing

Cross Examination

the Parchment 39

038-041_Parchment_Winter_2015.indd 39

09/12/2015 15:21

I will be against repealing the eighth amendment but my party has an open position on that government. We want to be in government. We don’t want to lounge around in opposition opposing things for the sake of it. We have enough parties and independents doing that. “It’s clear that the current coalition cannot form the next government as the most they can get is about 70 seats and that would be a very good day for Fine Gael and Labour. We set up the party to be an agent for change and the only way we can do that in our system is to be in government.” It’s a well-established truism in politics that no partnership can ever be definitively ruled out as needs must, but surely the way it ended in Fine Gael which still clearly leaves a bitter taste, would make life as coalition partners difficult. Does she harbour resentment about the night when she was unceremoniously cut loose for voting against the Protection of Life During Pregnancy bill in 2013? “I was annoyed at the time. I was more disappointed. I was pretty shocked by [Enda’s] behaviour but I shouldn’t have been. He’ll do what is expedient for his own ends. Compromising on abortion being the best example but there are many others. I’m long over it. I don’t harbour resentment towards anyone in politics, least of all Enda Kenny.” Time heals most personal animosity or at the very least dulls the pain, but did she ever feel that walking away from a ministerial position and a very likely promotion in the next government was just a step too far in what was essentially a row over principle? “I think you wouldn’t be human if you didn’t doubt yourself but I’m pretty steadfast. I was hoping that sense might prevail and it’s ironic that Enda has now said he will contemplate a free vote in the parliamentary party in future in order to get rid of the abortion question. “There was a huge number of people in the parliamentary party who voted for that legislation who did not want to do so. For me, there was never a question that I would not vote in accordance with my conscience on that particular issue because it is so fundamental. It’s a question of life and death and the idea that you would protect your career is anathema for what I am in politics for.” While this is all consistent with her public position to date, I’m still puzzled as to how it co-exists with her burning ambition to succeed in politics. “When I speak about ambition, I like to think of it as a positive thing and the idea that you would pursue ambition at the

expense of principles and values is something I would not contemplate. For a lot of people, it’s about climbing up the ladder. I see it daily in this place [the Dail]. People are prepared to do anything to get promoted. They’re not the people we need in politics.” Now that she has flown the Fine Gael nest and is currently feathering a new one, surely the divisive nature of her pro-life views will cause endless problems both within the party and for the electorate? “I did not get elected on a pro-life platform. It is something I believe in very strongly but the things that motivated me to get into politics were building a sustainable economic vision for the country, a fair society – and that is much more about economic and social policy than just abortion. “I often find that when I’m talking to people about that [her pro-life stance], they say I mightn’t have agreed with you on that but I am absolutely supportive of the fact that you stood up for your principles and there are people in my constituency who will be voting for me, even though they don’t agree with my right to life view.” Is it safe therefore to assume that her opinion on repealing the eighth amendment falls into the category of extremely predictable? “I will be against repealing the eighth amendment but my party have an open position on that. There are people in the party who are ardently pro-life, people who are ardently pro-choice and people in the middle, which probably reflects Irish society. “I’m opposed to the current three-line whip system in Ireland. I believe we need to have a more flexible approach. So on issues other than matters of confidence and budgetary matters, on everything else we have an open approach which is what happens in most other European countries. We [Ireland] are an anomaly.” Lucinda wasn’t always a rebel. She followed a conventional route up the greasy pole until principles overtook pragmatism. Although born into a non-political family in Claremorris, Co Mayo in 1980, the lack of pedigree was no impediment to an early passion for politics. This in turn, fostered an interest in the law. “In school I did work experience in the Irish Times and they sent me to the Four Courts to cover a murder trial and I was fascinated by it.” It was the courtroom that she was taken with and never had any real interest in being a solicitor. She undertook an LLB in Trinity from 1998 to 2002 and went to New York

where she did the Bar there while working as paralegal. After returning and having put a foot on the first rung of the political ladder by running for and being elected to Dublin City Council first time out, she studied at the King’s Inns and then devilled with Pat O’Dwyer in 2006/2007. “I can’t claim to have been the most diligent devil because it was the year I was standing for the Dail for the first time. “I was elected in May and did contemplate doing a second year devilling but I was too busy. Being a TD today is very different to being a TD 20 or 30 years ago. “But I didn’t love studying law. I spent my time at Trinity in the Hist, the Phil and the Law Societies. I loved college but I didn’t love academic law. But when I devilled, I loved it. If I hadn’t been elected at that point, I definitely would have continued.” She is on record as saying that she won’t be in politics forever and, of course, there’s no guarantee of election even next year so would she see herself going back to the Bar? “I’m getting too old to go back. I’d recommend it as a young person’s game. I think it’s ideal to go down to the Bar at about 22 when you don’t know what it’s like to have money and you don’t have a family to support. At my stage in life, I have a daughter to support and though I don’t have a mortgage, I do have a very high rent and all of these considerations would make it very hard to go back to the Bar.” Although she will not be returning to the fold, she holds strong views on the regulation of the sector and as usual, doesn’t take any prisoners. The Legal Services Regulation bill, which is likely to be an Act by the time you read this, has been trundling through parliament for the last four years. “I think it’s an absolute whitewash. I was one of the vocal critics of the original bill as proposed by Alan Shatter. That bill was more of a crusade against barristers. It was a personal agenda against the legal profession and particularly the Law Library. Obviously, I wouldn’t support that. At the time, I wasn’t the only one in the parliamentary party who was highlighting concerns. Charlie Flanagan, who was party chairman at the time, and others were asking the minster to engage. He wasn’t interested. “I think it’s a very honourable profession and a lot of the myths propagated against barristers are totally untrue when you see a 50% attrition rate. I think the focus needs to be on getting value for money for consumers, competition in the sector and there needs to be accountability. I don’t think the new draft of the bill does a lot to achieve that.” It’s easy to hurl on the ditch though so what would she do differently? “I think the court system is massively

40 the Parchment

038-041_Parchment_Winter_2015.indd 40

09/12/2015 15:21

Winter 2015 dsba.ie

Cross Examination

Photography: Bryan Meade

archaic. Everything from the legal term to how cases are dealt with. We all love tradition but this doesn’t reflect the reality of the commercial world. We need longer sitting days and we probably need more judges. A lot of the costs are because of adjournments or motions.” At the time the bill first appeared, Lucinda’s star was in the ascendancy. She had been a bolter in the 2007 election when she took Michael McDowell’s seat out of the blue (if you’ll excuse the pun). Although she was seen as an outsider for the seat initially, it soon became apparent that she was making waves in the constituency. “I never do anything where I don’t believe I can succeed. It’s one of my strengths as a politician. I do have self-belief and I would be quite ambitious in the sense that if I put my mind to something I can achieve it. I felt there was a seat there. “There was an openness for somebody young. There was a fatigue about politics. The fact that I got out of the traps early, I had more than a year. I worked flatout. I didn’t do things by halves. I canvassed every week, multiple times a week. I built up a support base, a good team around me. I was very dogged in my attitude towards it.” Following her election, she was caught up in the tide of optimism that followed the resurgent party but soon was brought crashing back down to earth when she was overlooked for a heavily predicted front bench position. Although disappointed, she dusted herself down and got on with it. “I worked really hard on my committee work but there was no reshuffle until the heave and then there was wholesale change, and needless to say I wasn’t part of that.” She laughs as she utters this last sentiment but beneath good humour there is a firmly held conviction that Fine Gael would be stronger today with Richard Bruton in charge. As for the heave, it couldn’t have been handled worse. “It was absolutely inevitable when the heave happened, but it wasn’t organised well at all. Richard was getting emails on a daily basis but wasn’t talking to anyone about it. I think Enda and Phil Hogan and Co were planning for this to happen so they were prepared for it and Richard wasn’t. Obviously I was going to support Richard, it was a no brainer but there was no strategy or plan.” Does she regret backing the wrong horse? Typically and consistent with all other decisions, she doesn’t. “I’m a firm believer that in politics, you have to do what you believe is the right thing and I absolutely stand over it. My firm view is that Fine Gael would have got an overall majority if Richard Bruton had been leading the party.” Of course, history is written by the

Lucinda Creighton at a glance

NAME Lucinda Creighton PARTNER Paul Bradford CHILDREN Gwendolyne, aged 20 months BIGGEST INFLUENCE ON YOUR LEGAL CAREER I would have to say my master Pat O’Dwyer, BL! FAVOURITE MOVIE No Country for Old Men - I love all the Coen Brothers movies FAVOURITE SINGER Leonard Cohen HOBBIES Everything related to horses. I show jump competitively at amateur level. I also love horse racing – Cheltenham being the highlight for me. I’m into fitness and go spinning a couple of times a week, as well as running.

winners and Enda has gone from strength to strength since. While Lucinda was appointed Minister for European Affairs and enjoyed it immensely, she remains convinced that some of the appointments following the 2011 election were merely jobs for the boys and is scathing in her analysis. “There were a few TDs on the verge of mental breakdown that they weren’t being appointed ministers. I remember a big group of us went out for dinner that night and there was quite a lot to drink. There was a lot of anger and disappointment that night. A lot of people who shouldn’t have been appointed ministers were, but they had to be rewarded. Those people are self-evident when you look around.” Unsurprisingly, she is reluctant to name names but clearly believes we can hazard an educated guess.

What’s refreshing about Lucinda Creighton is that she says what’s on her mind. There are no coded or subtle references, no attempts to avoid the question. It might be argued that this is easy in opposition, but let’s not forget that she walked away from a ministerial position and certain progression up the political ladder over a point of principle. You might not agree with her position on certain social issues, and personally I couldn’t disagree more, but it doesn’t mean that you can’t admire her chutzpah and disarming honesty. Time will tell whether Renua can plunder two or ten seats in the next election and that number may well define Lucinda’s political future but you would write her off at your peril. Something tells me Enda may be back on the phone to her yet. P the Parchment 41

038-041_Parchment_Winter_2015.indd 41

09/12/2015 15:21

Limited Liability for Solicitors - the story now

Robert Ryan addresses the provision in the updated Legal Services Regulation bill as to limited liability partnerships for solicitors

A ‘relevant business’ is defined as a “partnership of solicitors” or “a legal partnership” the latter being the existing provision in the LSRB for partnerships of solicitors and barristers

s readers of the Parchment will be aware the DSBA has been keeping a close watch on, and made numerous submissions in relation to, the Legal Services Regulation bill [“LRSB”] as it has evolved since 2011. Amongst various important changes to the LSRB advocated at the outset by the DSBA, are the inclusion of provisions enabling solicitors to practise through a limited liability partnership [“LLP”] business structure. This topic has been analysed before in detail, in previous Parchment articles in 2012 and 2013 entitled ‘Limited Liability for Solicitors - The Story so Far’. Whilst the wait since then has been long and uncertain, it is now very pleasing to report that the Government amendments to the LSRB as published on November 18th 2015 expressly provide, for the first time, for an LLP business structure to be available for use by solicitors. This is a most welcome development, and one which can be said to go some way towards satisfying one of the stated aims of the LSRB (as noted in its explanatory memorandum) namely to “better balance the respective interests of the public, consumers and legal professionals in their respective provision and consumption of legal services”. Set out in this article is a brief overview of the LLP business structure now provided for in the LSRB. References to sections are to those of the LSRB (at the time of writing).

LLP Definition The LLP is defined as “a relevant business in respect of which an authorisation, granted under section 109, is for the time being in force” (Section 84). A ‘relevant business’ in turn is defined as (a) “a partnership of solicitors” or (b) “a legal partnership” (the latter term being the existing provision in the LSRB for partnerships of solicitors and barristers). The Partnership Act 1890 is stated to apply to an LLP to the extent not inconsistent with the LSRB (section

107). Thus all the provisions of partnership law as enshrined in the 1890 Act will, save as varied under the LSRB, apply to an LLP.

Authorisation Any relevant business which wishes to operate as an LLP must make an application for authorisation to the Legal Services Regulatory Authority, [“Authority”] Section 109. The Authority is given power to make regulations as to the form of the LLP application, the amount of the application fee, the information to be provided on the proposed LLP (such as its composition, place of business etc), the information to be provided to clients as to the nature and effect of LLPs, and the ongoing compliancerelated information to be provided to the Authority, Section 114. The LLP will be required to have in place the required level of professional indemnity insurance, being also a matter subject to regulation by the Authority. The LLP will be required to conduct its business using a name that ends either with “limited liability partnership” or “LLP”. The Authority is required to make its decision on the application for authorisation within 60 days of receipt, subject to the application being in the required form and the required information having been provided (Section 109). Once authorised, the LLP will be subject to the regulatory oversight of the Authority in respect of compliance with the applicable statutory requirements. The authorisation framework summarised above, and subject to their scoping out by the Authority, would not appear to present any particular or material impediment to transitioning from an existing ordinary partnership of solicitors to an LLP.

Registration The Authority is required to establish and maintain

42 the Parchment

042-043_Parchment_Winter_2015.indd 42

09/12/2015 15:22

Winter 2015 dsba.ie Robert Ryan is the DSBA’s honorary treasurer and a council member. He’s also one of the DSBA nominees to the Law Society council and has recently become a member of the Law Society taskforce on the Legal Services Regulation bill. Robert is the principal of Doherty Ryan & Associates Solicitors

a register of LLPs, and which is to be available for inspection by the public (Section 110). The register is to include details as to the composition of the LLP, its name and place of business and its date of authorisation. The limited amount of information required for ongoing registration purposes should be helpful from a compliance and confidentiality perspective for LLPs.

Limited Liability The form of limited liability adopted under the LSRB is expressed in Section 107. This provides that: “a partner in a limited liability partnership shall not, by reason only of his or her being a partner or being held out as being a partner in that partnership, be personally liable, directly or indirectly, by way of contribution or otherwise, for any debts, obligations or liabilities arising in contract, tort or otherwise of: (a) the limited liability partnership, (b) himself or herself, (c) any other partner in that limited liability partnership (d) any employee, agent or representative of that limited liability partnership.” The exclusion of liability as provided for above is commonly known as “full shield” liability protection, as covering both tort and contract claims. This will (finally) place solicitors who adopt the LLP model on an equal footing with other professional service providers in Ireland who can operate using limited liability business structures (such as auditors, estate agents, investment intermediaries, etc). However (and as would be expected), the limitation of liability will not apply to a partner in an LLP to the

Practice Management

extent that: (a) the debt, obligation or liability referred to [in subsection (1)] is incurred as a result of an act or omission of the partner involving fraud or dishonesty, and (b) that act or omission (i) was the subject of a finding of misconduct under part 5 or (ii) constituted an offence of which the partner was convicted. Their term “misconduct” as defined (in Section 41) is expressed in broad terms. Other stated exclusions from limited liability include a debt, obligation or liability incurred for a purpose not connected with the carrying on of the business of the LLP; or which was incurred by reason of an act or omission occurring prior to the date of authorisation to operate as an LLP.

Summary The LLP model as set out in the LSRB is based on using (and thus preserving) the ordinary partnership legal structure that presently applies to solicitors’ firms, with the addition of the authorisation, registration and limited liability provisions noted above. By adopting this approach, the same (or mostly the same) accounting, taxation and regulatory framework for ordinary partnerships should presumably also be applicable to LLPs. This approach is to be much commended, particularly for its clarity and simplicity. It may perhaps be contrasted favourably to the UK LLP model which, although a partnership in name, ended up being a body corporate in its own right. The LLP will not however (by definition) provide limited liability for sole solicitor practices, an issue that remains no doubt for future consideration. P the Parchment 43

042-043_Parchment_Winter_2015.indd 43

09/12/2015 15:22

The Value of Everything Killian Morris and Adrian Power Kelly review recent legislation in the area of rating and valuations and set out changes in the appeals process which are often of most interest to commercial property owners

The 2015 Act has removed the “first appeal” and now, a ratepayer has only 40 days within which to make a representation to the Valuation Office in respect of the proposed rateable valuation

he Valuation (Amendment) Act 2015 (the “2015 Act”) was enacted on April 23rd 2015 and commenced (with the exception of section 14) on June 8th 2015. The rationale behind the 2015 Act was to enable the Government Valuation Office to speed up the revaluation of commercial properties throughout Ireland for rating purposes. This is a process which started in the South Dublin County Council area in 2007 but which to date, has only been carried out in six jurisdictions (South Dublin, Fingal, Dun Laoghaire/ Rathdown, Dublin City, Limerick and Waterford). To expedite the process, the 2015 Act includes provisions for revaluation by reference to indices, a quasi “selfassessment” system and outsourcing. The opportunity was also taken to amend some existing elements of the original Valuation Act 2001 including changes to appeal procedures.

Changes to Appeals Process Up to now, where a property was undergoing revaluation, a ratepayer had a three-part process which could be used to minimise the rateable valuation. These stages included an initial consultation period in the form of a “representations” stage, followed by a formal “first appeal” to the commissioner and lastly, a formal appeal to the Valuation Tribunal. The 2015 Act has removed the “first appeal” and now, a ratepayer has only 40 days within which to make a representation to the Valuation Office in respect of the proposed rateable valuation. Thereafter, if the ratepayer is still aggrieved, a formal appeal directly to the Valuation Tribunal must be made within 28 days of receiving the valuation certificate.

Whilst the aim of removing the “first appeal” process is ostensibly to remove an unnecessary layer from the process, the experience of rating consultants dealing with both representations and appeals in the general revaluation of properties in Dublin city and Waterford county areas wasn’t encouraging. In Dublin city, approximately 7,600 representations disputing proposed rateable valuations were received but only 1,250 properties had their valuations changed. There were approximately 2,600 first appeals lodged and some 912 subsequent appeals to the Valuation Tribunal. More notably consultants experienced minimal engagement at representation and first appeal stages, which no doubt contributed to the high level of subsequent appeals. It can be seen from the fact that nearly half of the appeals to the Valuation Tribunal have been settled, that engagement from the valuation office at an early stage could have saved all parties considerable time and expense. In Limerick a recent revaluation process saw a higher level of engagement with consultants resulting in 300 appeals, a majority of which were settled. Clearly if the representations stage is to work as envisaged, it will require meaningful interaction and negotiation otherwise the tribunal will see its workload substantially increase and its resources may be stretched.

Revaluation by Indexing Current legislation requires that where a revaluation has previously been carried out, it should be revisited every five to ten years. As a result, South Dublin’s revaluation will have to be completed again by 2017, followed by Fingal and Dun Laoghaire/Rathdown. This requirement could limit the ability of the

44 the Parchment

044-045_Parchment_Winter_2015.indd 44

09/12/2015 15:22

Winter 2015 dsba.ie Killian Morris is a solicitor at AMOSS Solicitors and he’s a member of the DSBA’s Parchment committee, Adrian Power-Kelly is principal of Power-Kelly and Co, chartered valuation surveyors and rating consultants

Valuation Office to start revaluations in other areas without requiring substantial additional resources and staffing. In an effort to alleviate this pressure, Section 5 of the 2015 Act has brought in a provision whereby rateable valuations can be determined by using general market data or “aggregated data” which can include statistical techniques. This section has yet to be utilised but South Dublin may well be a target for this valuation methodology. By its very nature, property is heterogeneous and a broad brush approach to valuation is fraught with potential dangers. The circumstances of properties can change, e.g. physical changes to the building, changes in occupancy or changes to market dynamics within the local vicinity such as competing schemes. The valuation acts refer to equity and uniformity of value between properties but, as a practising chartered valuation surveyor, I have difficulty in considering that the application of a mathematical equation to all properties accurately reflects the circumstances pertaining to each individual property.

Occupier Assisted Valuation Section 12 of the 2015 Act introduced a new element to rating law and practice in Ireland in the form of “occupier assisted valuation”. Section 12 inserted a new part 5A into the 2001 Act. An occupier of a property can be required to carry out a valuation of that property as part of a general revaluation of all commercial properties within a rating authority area and submit that valuation to the commissioner. Ministerial regulations can include how the occupier must carry out the valuation and

Commercial Property

Section 5 of the 2015 Act has brought in a provision whereby rateable valuations can be determined by using general market data or “aggregated data” which can include statistical techniques the records he must retain. Where the occupier submits a valuation with which the commissioner does not agree, the commissioner may substitute an alternative valuation. More importantly, where the occupier submits a valuation which the Valuation Office considers to be inaccurate (or is not submitted within deadline), then the occupier may be guilty of an offence. Accordingly there is a concern as to whether an occupier or consultant could be held guilty of an offence for having a differing opinion to that of the commissioner. It is also noteworthy that while the occupier can be required to submit a valuation, there is no provision whereby anyone other than the occupier may make representations disputing the valuation, e.g. a head lessee or a landlord. It is only at Valuation Tribunal appeal stage that others can become involved in the process. The 2015 Act has introduced some innovative elements into rating practice in Ireland and many of these are still untried. It remains to be seen how these will play out in the short term and, in the coming years, there are some potentially interesting valuation and legal arguments which will be advanced before both the Valuation Tribunal and the courts. P the Parchment 45

044-045_Parchment_Winter_2015.indd 45

09/12/2015 15:22

Enduring Power of Attorney A practical solution

Cloud-based version of the Tyrrell Associates EPA Generator originally commissioned by the Law Society.

Reduces Risk

Generates the full suite of documents

"We don’t get the opportunity to do these very often but when we do the EPA Generator takes away the worry. An excellent product." Maurice O'Connor ~ Healy O'Connor Solicitors

Automatic text strike-out as per SI Full database of EPAs per practice

Saves Time “I can draft an EPA or Registration in less than 5 minutes with no need for dictation or secretarial support.” Justin McKenna ~ Partners at Law Solicitors

Minimises Costs

Pay As You Go - €60 plus VAT per instrument. Annual Subscription for unlimited use also available.

“As a sole practitioner the EPA Generator is one of the essential tools that I use on a daily basis. It reduces risk and saves me time and money.” Paula Fallon ~ Paula Fallon & Associates Solicitors

For more details contact Therese Tyrrell therese@tyrrellassociates.com 086 8110693

33468_Tyrrell Associates.indd 1

08/12/2015 16:59

Winter 2015 dsba.ie Clara Murray is head of the summons serving department in Hibernian Legal (International) Limited

News

The Law of Security Clara Murray inspects the new legislative regime for private security personnel and private investigators

n November 1st 2015 new legislation came into effect requiring private security investigators to be licensed with the Private Security Authority (PSA). The new requirements, enacted under the Private Security Services Act, 2004, represent a significant development in the continual strengthening of privacy laws. The PSA was established in 2004 and up until now has been charged with the regulation of private security

functions such as CCTV monitoring, private security, installation of monitoring and alarm devices and cash intransit. This is its first move into the investigative sector. The main effect of the legislation is to ensure that all private investigators (whether individuals or organisations) hold a licence, subject to certain conditions. These include garda vetting, an external audit, a clean criminal history and the ability to pay a licence fee of between â&#x201A;Ź1,000 and â&#x201A;Ź25,000, dependant on turnover, every two years. Private the Parchment 47

047-048_Parchment_Winter_2015.indd 47

09/12/2015 15:23

In 2014 a number of scandals blighted the ‘tracing’ industry, in which solicitors, banks or credit unions employ private investigators to locate and confirm addresses for debtors. Several tracing agents were found to have been using illegal or at least unethical, tactics to uncover data investigators must also have their home or place of work fitted with an alarm system, a safe and CCTV to ensure the security of any personal data held on their premises. It is now an offence to advertise oneself as a private investigator, or employ one, without holding a licence. At the time of writing 31 private investigator licences have been issued to individuals and companies across Ireland. Regulation is overdue in the industry and many factions have welcomed the changes. In 2014 a number of scandals blighted the ‘tracing’ industry in which solicitors, banks or credit unions employ private investigators to locate and confirm addresses for debtors. Several tracing agents were found to have been using illegal, or at least unethical, tactics to uncover data. This included inappropriate access to the Garda Pulse system and ‘blagging’ of personal details from State institutions and other data repositories such as the HSE and Department of Social Protection. Two directors of MCK Rentals Ltd, Wendy Martin and Margaret Stuart, were the first private investigators to be prosecuted under the Data Protection Act for conducting enquiries in this manner in 2014. Even this week an Irish financial institution has been embroiled in allegations regarding the engagement of a private investigator that was allegedly found to be holding data illegally obtained from the Department of Social Protection. These cases and others have highlighted the need for increased oversight in this area. However, the Private Security Act introduces a new and complex direction for the Authority’s remit. Questions have been asked as to whether there was sufficient consultation with the legal profession prior to the enactment. This is illustrated by the sheer number of clarifications regarding the requirements to hold a licence that had to be issued by the Authority in the weeks leading up to November 1st 2015. For example, many solicitors who do not directly use tracing services may think this legislation will not affect them. However, virtually all legal firms will need to employ a summons server at some stage during the course of their business. The PSA states that “serving a summons on a person named on the summons at the address shown on the summons and on the basis of information provided with the summons documentation, is not a licensable activity”. But if a summons server carries out any kind of “investigative activities” in the course of their work, they are required to hold a licence. This detail will inevitably

cause some degree of confusion, betraying the lack of consultancy with the industry. How does one define ‘investigative’? It’s not as clear-cut as you might assume. While it may make sense from a regulator’s point of view to expressly prohibit unlicensed summons servers from attempting to discover a different service address to the one provided by a solicitor, in practise efficient summons service often depends on informal investigative work. This can include making enquiries with neighbours about when an individual might be home or whether they have moved away entirely, and it can prevent unnecessary and fruitless attempts at service. Time will tell, but it is easy to foresee the licensing requirements causing additional delays and costs for court processes and adding an extra layer of red tape to litigation. The profile of the average personal investigator might also surprise some. They are largely retired, often ex gardaí who take on a few hours of work a week to stay active and engaged. Many have long-established relationships with local solicitors. Almost all have a turnover at the low end of the €10-€30,000 band proposed by the PSA. These small operators will be most affected by the new legislation. They are faced with three choices: stump up approximately €5,000 in order to obtain their own licence; work exclusively for a licensed company which may mean an inconvenient level of work for their lifestyle; or simply give up the game entirely. This will inevitably lead to fewer choices for solicitors as investigators are forced to professionalise or retire. Freelance tracing agents and summons servers often work with solicitors on a casual basis and are relied upon for their thoroughness, experience and vital local contacts. Many of these casual investigators I have spoken to are indeed being forced to restrict their activities to basic summons serving, or have simply given up. One long-time tracing agent in the west of Ireland states that he cannot obtain a licence as one of the requirements is to have your name and address listed on a publicly available register – something which would expose him, as a former garda, to potential unwanted attention. This loss of independent investigators – although not having a large impact at present – has opened up a gap in the market for companies to set up quickly. Under the new regulations a company’s licence covers all of their employees and any contractors or agents who work exclusively for them. It is far more financially viable to obtain a licence as an organisation rather than individually due to the ‘turnover fee’ and security requirements. However, while these new operations may have the finances and contacts to obtain a licence, it does not follow that they have the necessary experience or track record. The holding of a licence might obscure this. It is important to remember when contracting a licensed summons service or tracing agency that, although it has fulfilled the Authority’s requirements it may not necessarily be the type of company with which you want to do business. While the new Act does go some way to preventing the shocking disregard for data protection and personal privacy displayed by some investigative services in the past, it is my view that the manner in which it has been implemented means that its impact will be felt just as strongly on ethical, above-board investigators. P

48 the Parchment

047-048_Parchment_Winter_2015.indd 48

09/12/2015 15:23

Established 1982 - Fully Bonded

ASSET INVESTIGATIONS

SUMMONS & DOCUMENT SERVICE

TRACING ENQUIRIES

(WORLDWIDE)

Hibernian Legal (International) Ltd is fully licensed with the Private Security Authority (PSA) and has been serving documents and conducting asset investigations for over 30 years. We offer a professional and high quality service, providing in-depth analysis and detailed reports to suit your business needs.

info@hibernianlegal.ie

+353 1 872 3067

TOWN AGENCY & LEGAL SUPPORT SERVICES

CLOSINGS & GENERAL CONVEYANCING

(CIVIL, COMMERCIAL & CRIMINAL)

(CLOSING PACKAGES NOW AVAILABLE)

Dublin and Waterford Inns Chambers, 15 Upper Ormond Quay, Dublin 7, D07 YK6A. DX 1041 Four Courts. T: 01 872 3067 F: 01 873 1623 E: info@hibernianlegal.ie www.hibernianlegal.ie

Directors’ Transactions changed by Companies Act The Companies Act 2014 (the “Act”) introduced some significant changes to company law with regard to transactions with directors. Pauline Louth highlights new provisions on evidential requirements for loans to and from directors, changes to the regime on substantial transactions with directors and some significant changes to the regime on the making of loans to directors

Loans to and from Directors - Evidential Requirements

If it is shown or proven that a loan was in fact made to the company, then there will be a rebuttable presumption that the loan is interest free, unsecured and subordinated to all other debt of the company

Section 236(2) of the Act provides that if a company makes a loan to a director of the company, its holding company or to a person connected with such director and the terms are not in writing, there is a rebuttable presumption that (a) the loan is repayable on demand and (b) is interest bearing at the ‘appropriate rate’. This ‘appropriate rate’ is defined as 5% or such other rate as may be specified by ministerial order {section 2 (7)}. These terms are also presumed where the loan is in writing, but the terms of such loan are ambiguous. The rationale behind this new provision is to remind directors and shareholders that the company is a separate legal entity and that the company’s funds are not the funds of the shareholders or directors. Although the presumption only applies in ‘relevant proceedings’ (which are civil proceedings in which it is claimed that such a loan is made), clients should be encouraged to document all new loans and, where possible, existing loans should also be put into writing. Conversely, section 237 provides that where it is claimed that a loan has been made by a director (or connected person) to a company or its holding company, and where such loan is not in writing, there will be a rebuttable presumption that no such loan was made – the implication being that it was a gift or an advance. If it is shown or proven that a loan was in fact made to the company, then there will be a rebuttable presumption that the loan is interest free, unsecured and subordinated to all other debt of the company. Again the same presumptions will apply if the loan is in writing, but its terms are ambiguous.

The rationale behind this provision may be obvious: where a company goes into insolvent liquidation with a loan or loans from directors, those directors will be creditors of the company and will rank pari passu with other creditors. It was felt that in some cases no such loans were made, or if advances were made, they were never intended to be repaid, hence the provision encouraging directors and companies to document such loans. An anomaly appears to arise in the wording of Section 237(3) where subsections (a) and (b) provide for a presumption that where the terms are ambiguous, the loan is interest free and unsecured, but subsection (c) appears to only subordinate the loan once it is proved to be secured. It therefore appears that an unsecured loan would rank pari passu with the other debt of the company, but a secured loan would be subordinate to all other debt. The lesson is that directors should ensure that all such loans are documented with terms set out clearly to avoid – having given loans to the company – being treated as unsecured creditors, or worse, not creditors at all. In each case, a simple form agreement can be put in place between the company and the director setting out the agreed terms with regard to repayment, interest, etc.

Substantial Transactions in respect of non-cash Assets Section 29 of the Companies Act 1990 (“1990 Act”) introduced rules governing the entry by a company into substantial property transactions with directors and/

50 the Parchment

050-051_Parchment_Winter_2015.indd 50

09/12/2015 15:26

Winter 2015 dsba.ie Pauline Louth is a partner and head of knowledge management at Beauchamps Solicitors

Company Law

or connected persons which, unless the arrangement was below a certain threshold or fell within certain exemptions, required shareholder approval. Section 238 of the Act essentially re-enacts the provisions of section 29 with two changes. Firstly, the de minimus threshold is raised, so that approval is only required where the value of the assets concerned exceeds €5,000 and, subject to that, exceeds €65,000 or 10% of the net assets of the company. Secondly the provisions of the section do not now apply to the disposal of assets by a receiver {section 238(4)(c)}.

Restricted Transactions Section 239 of the Act sets out the general prohibition on a company making a loan or quasiloan to, or entering into a credit transaction or guarantee or providing security for, a director or a person connected to a director. These provisions were previously contained in section 31 of the 1990 Act. Sections 240 and 242-245 of the Act set out exceptions to the general prohibition as follows: (a) The value of the arrangement is less than 10% of the company’s net assets. The scope of this exception has been widened in the Act. Previously, under section 32 of the 1990 Act, guarantees and the provision of security for a director were prohibited, irrespective of their value. Where the company’s net assets decrease and the arrangement comes to represent more than 10% of the company’s net assets, then the company and the director must take reasonable steps to reduce the balances outstanding to bring them below the 10% threshold. (b) A Summary Approval Procedure (SAP) is carried out with regard to the prohibited arrangement. The SAP is a method provided for in the Act which validates otherwise prohibited transactions. In the case of transactions with directors prohibited by section 239, the SAP involves the making of a declaration by the directors of the company, containing certain information relating to the proposed transaction, and the passing of a special resolution of the members of the company approving the transaction. Significantly, the SAP does not require an auditor’s report. Section 34 of the 1990 Act also allowed for a whitewash procedure, but that section also required a report from an independent expert auditor opining that the director’s declaration was reasonable. Auditors were very reluctant to give such a report, indeed they were all but impossible to obtain, making the Section 34 whitewash largely unworkable. The removal of this requirement is very welcome. (c) The arrangement is with a member of the same group of companies. The provision refers to “any body corporate” so that it now clearly extends to any holding company, subsidiary or sister company, whether incorporated in Ireland or elsewhere. (d) The arrangement is a reimbursement of the director’s expenses - there is no change here from the provisions of the 1990 Act. (e) The company enters into the transaction in the ordinary course of business and the value of the transaction is not greater nor the terms better than that which the company would offer ordinarily. This exemption has been expanded to include

giving guarantees and providing security. Subsection 245 (2)(b)(ii) also provides that if it would not be unreasonable to expect the company to have offered such terms, the arrangement will be exempt from the prohibition. This is a change from the previous position which required the terms of the arrangement to be ‘reasonable’ rather than ‘not unreasonable’, so in theory there is now less of an onus on the company availing of the exception.

Definitions The definition of ‘connected person’ has been expanded to include a child of a civil partner of a director who is ordinarily resident with the director and his or her civil partner. There is also a new presumption that the sole member of a single member company is connected with a director of that company. Finally, the concept of de facto director has been well established at common law and section 222 now gives express recognition to this.

Conclusion To some extent the Act restates the previous law regarding transactions between companies and directors and connected persons, but with some helpful improvements. In particular, the ability to validate a restricted transaction using the SAP, without the requirement for an auditor’s report, is very useful. P the Parchment 51

050-051_Parchment_Winter_2015.indd 51

09/12/2015 15:26

Facebook – the export of data from Europe must stop Greg Ryan examines a European Court of Justice decision which greatly affects Facebook and social media users

n October 6th 2015, the European Court of Justice handed down its decision in the case of Max Schrems v Facebook. In short, the court declared that the European Commission’s US Safe Harbour Decision is invalid. Under European law, and in particular the data protection directive, it provides that the transfer of personal data to a third country may, in principle, take place only if that third country secures an adequate level of protection of the data. The directive also provides that the commission may find that a third country ensures an adequate level of protection by reason of its domestic law and its international commitments. Max Schrems, an Austrian citizen, and a student at the university of Vienna, and also a Facebook user, challenged the practice by Facebook of exporting personal data from Europe. As is the case with the other subscribers residing in the EU, some or all of the data provided by Mr Schrems to Facebook is transferred from Facebook’s Irish subsidiary to servers located in the United States, where it is processed. Mr Schrems lodged a complaint with the Irish Data Protection Commissioner (the Irish supervisory authority) taking a view that in light of the Snowdon revelation in 2013 concerning the activities of the United States intelligence services (in particular the National Security Agency), the law and practice of the United States did not offer sufficient protection against surveillance by the public authorities of the data transferred to that country. The Irish authority rejected that complaint on the grounds in particular, that in a decision of July 26th 2000, the commission considered that under the “safe harbour” scheme, the United States ensures an adequate level of protection of the personal data transferred (the safe harbour decision).

The decision of the Data Protection Commission was judicially reviewed, and the Irish High Court referred the matter to the European Court of Justice, seeking to ascertain whether the commission decision had the effect of preventing the national supervisory authority from investigating a complaint, (alleging that the third country does not ensure an adequate level of protection), and indeed from suspending the contested transfer of data. The Court of Justice held that the existence of the commission decision finding that the third country ensures an adequate level of protection of the personal data transfer, cannot eliminate or even reduce the powers available to the national supervisory authorities under the charter of fundamental rights of the European Union and the directive. The case was based on the facts revealed by Edward Snowdon who uncovered the mass surveillance by the US Government, which has been widely reported in the media. Most US tech companies involved in US mass surveillance have their international or European headquarters in either Luxembourg or Ireland. Facebook Inc has outsourced its operations outside the US and Canada to Facebook Ireland Limited, based in Dublin. Facebook Ireland Limited is responsible for more than 83.1% of all worldwide Facebook users, according to the US parent company. The data is not processed in Dublin, but is forwarded by Facebook Ireland to Facebook Inc in the United States. Facebook only operates an office in Dublin. It is this sharing of data with Facebook Inc that constituted the transfer to a third country, or simply put a data export to the US. The legal details of this case are more complicated than the simple question of whether the US provided an adequate protection, as there is a complex interplay

52 the Parchment

052-053_Parchment_Winter_2015.indd 52

09/12/2015 15:27

Winter 2015 dsba.ie Greg Ryan is programmes director of the DSBA and chair of the Law Society Technology Committee

between the different layers of EU law. Data protection issues in Europe are regulated in directive 95/46/ EC. That directive says that the data may only be transferred in a non-EU country if “adequate protection” is provided. In 2000, the European Commission issued the socalled “safe harbour” decision ( an executive decision 2000/520/EC) which provided that companies in the US that have self-certified under the so-called safe harbour programme provide adequate protection within the meaning of the EU law. Facebook Inc has self-certified the safe harbour, just like more than 4,000 other US companies. The question which arose before the court was whether the safe harbour decision (2000/520/EC) by the European Commission from 2000, can be interpreted to be in line with EU law. If not, the decision would be invalid. It should be noted that safe harbour is an executive decision by the European Commission, and not an international agreement. Another issue arose as the ECJ held in the 2014 data retention decision (C-293/12 and C-594/2012) that the mass collection of meta-data is a violation of the EU’s Charter on Fundamental Human Rights. One of the key findings of the court was that the legislation permitting the public authorities to have access on a generalised basis to the content of electronic communications must be regarded as compromising the essence of a fundamental right to respect for private life. Likewise, the court observed that the legislation not providing for any possibilities for an individual to pursue legal remedies in order to have access to personal data relating to him, or to obtain the rectification of erasure of such data,

IT Law

compromises the essence of the fundamental right to affect judicial protection, the existence of such a possibility being inherent in the existence of the rule of law. The net result of the court’s findings was that the court declared the safe harbour decision invalid. Consequently, the Irish supervisory authority, the Irish Data Protection Commissioner, is now required to examine Mr Schrem’s complaint of all due diligence, and at the conclusion of its investigation, is to decide whether pursuant to the directive, the transfer of the data of Facebook’s European subscribers to the United States, should be suspended. This was confirmed on October 21st at the Irish High Court when that court decided that the Irish Data Protection Commissioner was obliged to investigate Facebook Ireland over the alleged co-operation with US national security programmes such as under the NSA’s “prism” programme. This was followed up in Austria with a decision in favour of the Facebook privacy action, a case taken by 25,000 citizens in Austria, which has now been appealed to the Supreme Court. The decision by the Austrian Supreme Court is expected early next year. Looking forward, there’s a new umbrella agreement, agreed in principle between the EU and the US. This only covers data that is exchanged between the EU and US Authorities in the framework of law enforcement, and not national security. This has not yet been enacted into law. A judicial redress bill has also been planned, but also is far from being signed. The net result is a limitation of the transfer of data from the EU to the US which will certainly benefit EU cloud providers who are able to ensure compliance with EU law immediately.

Facebook Ireland Limited is responsible for more than 83.1% of all worldwide Facebook users, according to the US parent company. The data is not processed in Dublin, but is forwarded by Facebook Ireland to Facebook Inc in the United States P

the Parchment 53

052-053_Parchment_Winter_2015.indd 53

09/12/2015 15:28

News

IAML Essay Prize The deadline for essay submissions for the International Academy of Matrimonial Lawyers (IAML) competition is January 9th 2016. This year’s subject is the relocation of children – a topic of increasing relevance to the IAML. Entrants should be practising family lawyers of up to ten years qualification and/ or experience and be residing in a European jurisdiction. Entries from trainee lawyers, student barristers or the equivalent are also welcomed. More information can be obtained by visiting: www.iaml.org/chapters/europe

New Conveyancing Stipulation Attention all practitioners to the effect of clause 7 (valuation of residential property) of SI 47/2015 (Central Bank (Supervision and Enforcement) Act 2013 (Section 48) (Housing Loan Requirements) Regulations 2015) on residential conveyancing transactions. When a purchaser is purchasing with the assistance of a secured loan, their lender is required to ensure that they appoint an appraiser to carry out a market valuation of the residential property on which the loan is to be secured.

Clause 7(3) of the regulations stipulates that a lender must ensure that the appraiser appointed does not carry out the market valuation earlier than a period of two months prior to the date of draw down of funds. In light of the timeframes involved in conveyancing transactions, many such transactions may now require the lender to obtain a second valuation of the property prior to draw down. This has potentially serious consequences for a purchaser if the subsequent valuation

is lower, particularly in circumstances where they have entered a legally binding contract on foot of their letter of loan approval, and that approval was supported by the higher valuation. Practitioners are referred to the practice note of the Conveyancing committee of the Law Society of Ireland dated September 4th 2015, wherein they advise a) the inclusion of a special condition in the contract for sale; and b) to bring the effect of the regulations to the attention of their clients.

Samantha’s Climb for Charity Well done to Samantha Geraghty, partner at P O’Connor and Sons Solicitors in Swinford, Co Mayo. Samantha and 99 others climbed Croagh Patrick on November 21st 2015 in order to raise money for children suffering from cystic fibrosis and the Bubblegum Club which provides respite care to CF sufferers. In excess of €35,000 has been collected so far for children with cystic fibrosis and the Bubblegum Club. Whilst Samantha and the others climbed a very large mountain last month – many of those children climb big mountains every day. Donations can be given at www.ifundraise. ie/SamanthandNeil 54 the Parchment

054-055_Parchment_Winter_2015.indd 54

09/12/2015 15:28

Winter 2015 dsba.ie

DSBA Younger Members News

Legal Quiz 2015 A great night was had by all at the annual SYS /DSBA table quiz which took place on October 15th 2015 in the Alexander Hotel. The event as always sponsored by Brightwater Recruitment Specialists, raised over €4,000 for the Emer Casey Foundation and the Irish Hospice Foundation. It was a close run race eventually going to a tie-breaker question but Matheson just pipped William Fry to the post. Finn Kelly, Emmet Creighton, Andrew Norry and James Cullinane were the worthy winners. Matheson of course have had their names on the cup before, having won three times in previous years but were keen to get the trophy back after relinquishing it to McKeever Rowan in 2014. The raffle was a great success with

fabulous prizes which were collected by the various members of the SYS /DSBA committees. Special thanks go to Marguerite Seymour and Laura Horan of the Younger Members DSBA committee and Sarah Lawn of the SYS.

Successful Seminars In November the DSBA Younger Members committee held a very successful seminar dealing with two very interesting topics: The Court of Appeal, an Overview and Ethical Issues for the Conveyancer. Two very esteemed speakers spoke at the event; the honourable Mr Justice Ryan, President of the Court of Appeal and Mr David Soden. The event was kindly hosted by Morgan McKinley’s legal recruitment team in their stunning offices on Burlington Road. The honourable Mr Justice Ryan provided an overview of the Court of Appeal. His talk focused on providing practitioners with an insight into the operation and practices of the newly constituted Court of Appeal along with some very helpful guidelines and tips for litigation practitioners. Mr David Soden presented on the topic of Ethical issues for the Conveyancer. His talk focused on the ethical issues arising on conveyances which practitioners should be cognitive of when acting including (1) “Can I act?” (2) undertakings generally and (3) a detailed look at each of the three phases of a conveyance: pre-contract, taking the transaction to The DSBA Younger Members would like to express their thanks to the honourable Mr Justice Ryan and Mr David Soden for taking the time to speak at the event and to Morgan McKinley for very kindly hosting the event. the Parchment 55

054-055_Parchment_Winter_2015.indd 55

09/12/2015 15:29

  

‘Get your free online quote now’ Why do Solicitors recommend Property Health Check to their clients for Pre-Purchase Surveys and Planning / Building Regulation Certificates? Because our thorough survey prevents their clients from purchasing a money pit. Here is why... ✓ We are professionally qualified and PI insured Building Surveyors ✓ All of our Pre-Purchase Building Surveys are detailed and unbiased, and include annotated photo’s of defects and areas of concern

Being a lawyer can be very rewarding, but it can also be very challenging. When it all gets a bit too much, you can turn to LawCare. We oﬀer a completely free and condenal support service, and can refer you on for further help where needed.

✓ Our sole objective is to ensure that YOUR CLIENT is provided with independent professional advice; enabling them to make the best decision and protect their long term interest ✓ Free sample reports are available on our website from our homepage If required our reports can also include:  Party Walls Concerns  Possible / Likely Encroachment over Boundary Lines  Alerts on Extensions / Alterations that may require Planning Permission and / or Building Regulation compliance certificates  Summary, for quick reference Over 15,000 solicitors and their clients have already chosen Property Health Check for their Building Surveying needs. See our website for numerous satisfied clients testimonials.

1800 991801 www.lawcare.ie LawCare Ltd. Registered as a charity in England and Wales no. 1061685 and in Scotland no. SCO39335.

www.propertyhealthcheck.ie Email: info@propertyhealthcheck.ie

Is your website working for you?

33479_LawCare.indd 1

Phone No: 01-628 1040

33556_property 24/11/2015 health 14:51 check 1-4.indd 1

61% of people have a better opinion of a business when they offer a good online experience.

Talk to Snap Jervis to find out how we can improve your online presence to attract more clients through website design, SEO and paid advertising.

Tel: (01) 872 5077 | Email: jervis@snap.ie

24/11/2015 14:45

• Pre-separation consultations • Negotiation of child-centred access agreements • Custody & access assessments • Attachment assessments • Guardian ad Litem • Parent mentoring and behavioural management • Specialist training for parents, foster carers and adoptive parents

Email: info@childandfamilysolutions.ie Office: 045 943797 Contact: Orla Ryan

M.Soc.Sc.NQSW M.Sc. Attachment Studies

www.childandfamilysolutions.ie

Let our experience assist yours

33518_SNAP PRINTING.indd 1 A4 Full page.indd 1

31945_Child 24/11/2015 & Family 14:461/4.indd 1

08/12/2015 11:34 08/12/2015 17:18

Winter 2015 dsba.ie

Property Seminar

Photography: Sofia Lindblom

The DSBA Property committee hosted a CPD seminar on November 17th 2015. The topics covered included The Multi Unit Development Act 2011 and Dealing with Management Companies; First Registrations - All Too Common Errors and Simplifying Vat on Property - The 10 Most Common Queries Answered. The speakers were Sonia McEntee (Apartment Law), Anne Ruddy (PRAI) and Janette Maxwell (Grant Thornton). Above: Mary Henry and Ray Moran Left: Pauleen Brady and Elaine Given

Right: David Larney and Sonia McEntee Far right: Yvonne Tyndall and Jeanette Maxwell

Left: Clodagh Hopkins and Donogh McGowan Far left: Joan Mahony, Darach Connolly and Paul Diamond Right: Una Burns and Paul Keogh Far right: Maureen Oâ&#x20AC;&#x2122;Meara, David Fowler and David Allen

the Parchment 57

057_Parchment_Winter_2015.indd 57

09/12/2015 15:39

50+ Years in Practice

A lunch was hosted by the DSBA in honour of Dublin solicitors who are 50 years (or more) in practice on October 16th 2014 at the RDS in Dublin, There was a large attendance to mark this very special annual occasion. Judge John O’Connor, a former President of the DSBA was special guest.

Above: Brendan Walsh, Aaron McKenna. Right: Guest speaker, Judge John O’Connor Left: Thelma King, Margaret Callanan Far left: Bryan O’Flaherty, John Buckley

Right: Eamonn Shannon, Susan Martin Far right: Gerard Gannon, Ailin Doyle, Sean O’Ceallaigh

Far Left: Diners at the annual celebration for solicitors who are 50+ years in practice Left: Tom Menton, Marie Cunneen

58 the Parchment

058-059_Parchment_Winter_2015.indd 58

09/12/2015 15:46

Winter 2015 dsba.ie Photography: Michael Finn

Above: Max Abrahamson, Thomas Smyth Left: May Kavanagh, Moya Quinlan, Con Clancy

Right: Barry Doyle, Harry Robinson Far right: Aaron McKenna, Elma Lynch, Judge John O’Connor

Left: John Lacy, Con Clancy, Thomas J O’Reilly Far left: Johnny Hopper, Geraldine Kelly, Eamonn Shannon, Hugh O’Neil Right: Attendees at the annual lunch for solicitors who are over 50 years in practice at Dublin’s RDS Far right: Pat O’Brien, James Mackey

the Parchment 59

058-059_Parchment_Winter_2015.indd 59

09/12/2015 15:46

DSBA annual general meeting

The DSBA held its annual general meeting on October 21st 2015 at the Westbury Hotel. A capacity crowd was in attendance where Eamonn Shannon took over the reins as the new DBSA President for the year ahead.

Above: Deirdre Farrell, Caroline Leonard, Danielle Kerins, Olivia Higgins, Jessica Hickey Right: Deirdre McDermott, Evanna Killeen Left: Aine Hynes, Justine Carty Far left: Kevin Oâ&#x20AC;&#x2122;Higgins, Paul Keane, Robert Ryan

Right: Robert and Josephine Ryan Far right: Keith Walsh, Eamonn Keenan, Aaron McKenna, Stuart Gilhooly

Left: Aaron McKenna, Elaine Given, Susan Martin, Niall Cawley Far left: Evanna and Ruadhan Killeen

60 the Parchment

060-061_Parchment_Winter_2015.indd 60

09/12/2015 15:47

Winter 2015 dsba.ie Photography: Michael Finn

Above: Emer Moriarty Crowley, Maura Smith, Claire Callanan Left: Jacinta Niland, Sinead Hennessy, Lorraine McDermott

Right: Edon Byrnes, Aine Gleeson Far right: Geraldine Kelly, John (Spanner) O’Malley, Julie Doyle

Left: Joe O’Malley, Lidia Levingston Far left: Orla Coyne, Tom Menton Right: Eamonn Shannon, Rob O’Reilly, Cathal Young Far right: Greg Ryan, Kevin O’Higgins, Elaine Breen

the Parchment 61

060-061_Parchment_Winter_2015.indd 61

09/12/2015 15:47

DSBA Younger Members Seminar

The DSBA Younger Members committee held a seminar on November 19th 2015 dealing with two topical issues - The Court of Appeal, an Overview and Ethical Issues for the Conveyancer. The honourable Mr Justice Ryan, President of the Court of Appeal and Mr David Soden Morgan McKinley kindly hosted the seminar.

Left: Marguerite Seymour, William Fry; Mr Justice Ryan, President Court of Appeal; Kiara Daly, Morgan McKinley; David Soden, David Soden Solicitors; Laura Horan, MacGeehin Toale

Left: Marguerite Seymour, William Fry; David Soden, speaker; Lisa Griffin, William Fry Far left: Amie Lee Foran, Aideen Murphy, Kiara Daly, Morgan McKinley

Right: Pat Fitzgerald, CEO, Morgan McKinley; Jonathan Olden, Morgan McKinley Far right: Catherine O’Callaghan, Eugene F Collins; Jonathan Olden, Morgan McKinley; Laura Horan, MacGeehin Toale

Left: Mr Justice Ryan, President Court of Appeal Far left: Kiara Daly, Morgan McKinley

62 the Parchment

062-063_Parchment_Winter_2015.indd 62

09/12/2015 15:51

Winter 2015 dsba.ie Photography: Paul Sherwood

Above: Susan Deasy, Anna Toher, Eugene F Collins Left: Paul Molloy, Anne Marie Browne, Mary Clare Stakelum, Morgan McKinley

Right: David Soden, David Soden Solicitors Far right: Mr Justice Ryan, President, Court of Appeal; David Soden, David Soden Solicitors

Left: Catriona Harney, G ร Nuallรกin & Co; John Somers, Liston & Co; Anita Finucane, barrister Far left: Jade and Eliza Farrelly, Donal Farrelly & Co the Parchment 63

062-063_Parchment_Winter_2015.indd 63

09/12/2015 15:52

Closing Argument Stuart Gilhooly

Stuart Gilhooly is a partner at HJ Ward & Co Solicitors and former president of the DSBA. He has won a number of journalistic awards for his writing

They Can’t Handle the Truth

his column has a soft spot for Thomas Mapother Cruise IV. Not the scientology bit or the couch jumping but rather his movies. He never lets you down and more often than not, they’re top class entertainment. Apart from Far and Away that is, but I suspect even Tom would go along with that. As courtroom romps, with a bit of Tom Cruise stardust go, it’s hard to look beyond the timeless A Few Good Men. On this occasion though, Lieutenant Daniel Kaffee, played with typical brio by Cruise, was upstaged by the didactic Colonel Nathan Jessup, superbly portrayed by Jack Nicholson, a man for whom self-belief comes as second nature. The denouement is the wonderful scene at the end when Kaffee goads Jessup into admitting he ordered the code red and Jessup, so convinced is he of his omnipotence that he can’t help but concede with the famous line “You can’t handle the truth”. Back in the real world this, of course, doesn’t happen but the legal profession had its own Jack Nicholson. For three years, Alan Shatter reigned supreme and believed he could change the face of the legal profession. In those three years, he initiated a lot of legislation, much of it reforming and required. He also took on what amounted to a mammoth task, the Legal Services Regulation bill which commenced over four years ago. It was driven by the political cliché that self-regulation doesn’t work and therefore only independent oversight will do. This concept has been unchallenged either politically or in media circles for many years now, so bringing oversight into the legal profession was also going to play well. Somewhat ironically, many members of the

legal profession were equally excited at the prospect of a Law Society without regulatory powers. As time progressed, the popular perception which still remains, was that the delays were the result of clandestine lobbying and dark arts operated by the legal professions. In fact, as Shatter admitted himself when he published the bill, it was a document that was designed for consultation and he fully expected amendments to be made. That he took this stance is to his credit, but he possibly underestimated firstly the size of the task he had undertaken and secondly, the trenchant opposition he would face from the Bar. In fact, the issues the Bar had with the bill, while clearly important to them, are of little interest to the solicitors’ profession. Legal partnerships are unlikely to take off even if they do become a reality. If a barrister wanted to go into partnership with a solicitor, he’d become a solicitor. Barristers do what they do because they enjoy the status they have. They generally have no interest in the world we inhabit. Multidisciplinary partnerships are more dangerous but the experience of other countries is that they have been a disaster and it seems a stretch to believe they would ever catch on in a jurisdiction this small. Ultimately, Alan Shatter shook off any Jessup-like tendencies and showed admirable ability to bend when confronted with incontrovertible arguments. The picture painted unfairly, by media in recent weeks is that his successor, Minister Fitzgerald, was bullied by the legal profession into watering down the bill. This is, in fact, completely wrong. Most of the changes were agreed before she took on the job

Ultimately, Alan Shatter, though he might have liked the Nicholson comparison, was more malleable than he has been given credit for

and the amendments she has made are a combination of reasonable concessions, such as on the issue of partnerships, practical improvements which were absolutely necessary and technical changes which occur with nearly every large piece of legislation. Clearly though, the truth should never get in the way of a good story and the largely ill-informed media, many of whom made no attempt to read the legislation merely reported on what they perceived to have occurred, rather than what actually did. To be fair to the minister, despite this onslaught, she stood strong in her beliefs and like her predecessor, refused to be cowed. One of the most common criticisms is that the cost savings originally envisaged were lost by caving into legal lobbying. This demonstrates the complete lack of insight by most commentators on the issue as, in fact, the costs provisions were one of the few areas of the bill that saw no practical change from that originally introduced by Shatter. Although the bill will see many changes in how the profession works and most will make our lives more difficult, the one boon which did come about from lobbying by both the DSBA and the Law Society is the advent of limited liability partnerships. At last, the legal profession will benefit from the same protection as other commercial entities. Ultimately Alan Shatter, though he might have liked the Nicholson comparison, was more malleable than he has been given credit for. He has lived to fight another day and so will we, though 2016 is going to have a different complexion to the last few centuries. This profession has always embraced change and come out stronger. And that’s a truth we can handle. P

64 the Parchment

064_Parchment_Winter_2015.indd 64

09/12/2015 15:52

IF LIFE GIVES YOU LEMONS WEâ&#x20AC;&#x2122;RE HERE TO HELP Consult a Colleague now in total confidence

Call us on 01 284 8484 All calls to the Consult A Colleague helpline are treated in the strictest confidence - there is no need to give a name or number. A confidential free service from the DSBA.

www.consultacolleague.ie

A4 Consult a collegue.indd 1

09/12/2015 14:37

licensed to use by the Law Society of Ireland

CortBase.indd 1

08/12/2015 17:24