Charles Cooper



Since 09 October 2007 it has been possible to claim, on their death, the unused Inheritance Tax Nil-Rate Band (‘NRB’) of their spouse or civil partner who died before them. This is often referred to as the ‘Transferable Nil-Rate Band’ or ‘TNRB’. By 2014, the Court of Appeal had been asked  to consider whether the wording of a so-called ‘Nil-Rate Band Legacy’ should properly include the TNRB as well. The case was Loring v Woodland Trust [2014] EWCA Civ 1314.

In that case, the relevant part of the NRB legacy read:

                ‘MY TRUSTEES shall set aside out of my residuary estate assets or cash of an aggregate value equal to                        such sum as is at the date of my death the amount of my unused nil-rate band for inheritance tax and to                      hold the same for such of the following…’

The Court of Appeal upheld the first instance decision that the legacy should be calculated so as to include both the unused NRB and the TNRB, even though the legislation had been introduced after execution of the will. Particular reference was made to the wording of s.8A Inheritance Tax Act 1984 as applying to increase the NRB rather than being a separate, additional, NRB.

HMRC has criticised the decision in Loring, in their Inheritance Tax Manual at IHTM43065, on the basis that the clause uses the specific words ‘the amount of my unused nil-rate band’.

From 06 April 2017, however, there is now an additional ‘Residence Nil-Rate Band’ and a ‘Transferable Residence Nil-Rate Band’ to contend with, the legislation for which is set out at ss.8D-8M Inheritance Tax Act 1984. Now, more than ever, caution is advised when drafting or interpreting NRB legacies within a will.

June 2018

 [Charles practised as a Solicitor and Higher Court Advocate before being called to the Bar, and specialises in tax, trusts, wills and probate.]

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Pimlico Plumbers Ltd & Mullins v Smith [2018] UKSC 29

In what is likely to be the leading authority on employment status for years to come, the Supreme Court today has dismissed the appeal of Pimlico Plumbers from the Court of Appeal decision that Mr Smith was a worker and not a self-employed contractor.

Mr Smith is a plumber who carried out work for Pimlico between 2005 and 2011. After suffering a heart attack in 2011, Mr Smith claimed to have been unfairly dismissed despite having presented himself as self-employed for VAT and income tax for 6 years. The facts of his engagement are complex, but the dispute between the parties centred around the legal categorisation of Pimlico’s business model. The model presented operatives to clients as working for the business, but at the same time the business internally sought to maintain that there was a legal relationship of self-employed independent contractor rather than employer and employee. The paperwork in this regard was confusing at best. The employment tribunal, EAT and Court of Appeal all reached the decision that Mr Smith was a ‘worker’ rather than a self-employed contractor. Today the Supreme Court judgment upheld that finding.

Whether or not someone is a worker or an employee is largely a matter of fact for the Tribunal to decide. Here Lord Wilson determined that, “the dominant feature of Mr Smith’s contracts with Pimlico was an obligation of personal performance …there were features of the contract which strongly militated against recognition of Pimlico as a client or customer of Mr Smith. Its tight control over him was reflected in its requirements that he should wear the branded Pimlico uniform; drive its branded van, to which Pimlico applied a tracker; carry its identity card; and closely follow the administrative instructions of its control room. The severe terms as to when and how much it was obliged to pay him, on which it relied, betrayed a grip on his economy inconsistent with his being a truly independent contractor.” The substantive claims will now proceed to be heard in the employment tribunal.

Although Charlie Mullins (the owner of Pimlico) prophesies that companies using self-employed contractors now face a ‘tsunami of claims’, this claim is most likely a gross exaggeration. As has always been the case, every individual case will require careful legal analysis of the true nature of the working relationship. The contractual label alone is not enough. The contract may term the relationship as one of self-employed contractor, but the substance of the obligation of personal performance is what counts. Here, there was criticism of “an irrelevant contract, cast in highly confusing terms”, necessitating proper scrutiny of the entire engagement. The famous judgment of Lord Templeman in Street v Mountford [1985] AC 809 comes to mind that “The manufacture of a five pronged implement for manual digging results in a fork even if the manufacturer, unfamiliar with the English language, insists that he intended to make and has made a spade.”

Companies routinely engaging self-employed contractors on any sort of routine basis would do well to potentially scrutinise and revise its contracts in light of this judgment. Individuals who feel as though they have been ‘strong armed’ into signing a contract declaring them to be self-employed, despite being heavily controlled by their company, may wish to consider negotiating a clearer and more honest working legal relationship. When it comes to drafting contracts that seek to control an operative whilst describing them as self-employed, the ‘careful choreography’ exercised by Pimlico is not enough to balance such inconsistent objectives. In future, contracts- be they for an employee, worker or self-employed contractor- should really call a spade a spade.

Andrew Worthley

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Solving Family Problems: Evolution or Revolution?

The out-going President of the Family Division, Sir James Munby, recently delivered a compelling lecture in Liverpool, calling for the creation of an enhanced and re-vamped family court with much wider powers to engage with the many difficulties faced by families in society.

With laudable ambition, the President referred to the simplicity of his proposals whilst recognising that the road to achieving them would be long and hard.

“We have somehow to create a one-stop shop in an enhanced re-vamped family court capable of dealing holistically, because it has been given the necessary tools, with all a family’s problems, whatever they may be. More narrowly, dealing holistically with the family court’s traditional concerns with status, relationship breakdown and family finances; more widely, and ultimately more importantly, dealing holistically with all the multiple difficulties and deprivations – economic, social, educational, employment, housing and health (whether physical or mental) – to which so many children and their families are victim. Family justice is surely about something much wider than mere lawyers’ law.”

In his sweeping assessment of the limitations of the current family justice system, the President identified four problems that needed solving.

Firstly, there is the problem that the complex procedures (both statutory and as set out in the Family Procedure Rules 2010) for addressing the three central concerns of family law – status, relationship breakdown and the family’s finances – prevent the family court ever addressing the family’s problems holistically and in a simple ‘one-stop’ process. This fragmentation of the family court’s processes can lead only to delay, added cost and, worst of all, additional stress for all concerned.
Secondly, family courts should be, but for the most part are not, ‘problem-solving’ courts. He pointed to the success of the Family Drug and Alcohol Courts, noting the greater incidence of reunification in cases managed through this problem-solving paradigm.

Thirdly, cases involving families, parents and children are spread across the jurisdictions, so that families from time to time find themselves enmeshed in the various justice systems in England and Wales. In this regard, the President highlighted the different jurisdictions (and avenues of appeal) to decide family cases, criminal cases involving children, mental health issues and issues such as asylum and immigration. Rather then bringing these jurisdictions under one overarching enhanced court, the President considered judicial ‘cross-ticketing’ as a means of bringing expertise and experience to these many and varied jurisdictions.

Fourthly, the President identified a very common frustration in public law proceedings in particular – the family court cannot direct that resources be made available or that services be provided; it can merely seek to persuade. The President argued eloquently for primary legislation, which would give the court the power to direct the provision of services in certain circumstances.

Evolution or revolution? However one characterises the reforms proposed by the President, his assessment of the current state of the family justice system is only one step away from its condemnation as a system not fit for the holistic objective purpose of solving family problems.

Richard Powell

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Constructive Dismissal: Appealing the Last Straw

Constructive Dismissal: Appealing the Last Straw

Can the rejection of an appeal against a final written warning constitute a ‘last straw’ for the purposes of a constructive dismissal claim? Not in the case of Kaur v Leeds Teaching Hospitals NHS Trust [2018] EWCA Civ 978, where the Court of Appeal determined that “such a process, properly followed…cannot constitute a repudiatory breach of contract, or contribute to a series of acts which cumulatively constitute such a breach.”

The appellant in this case had been involved in an altercation with a colleague and raised a grievance over the matter. This triggered disciplinary proceedings against her which were conducted by way of a combined grievance/disciplinary procedure. The outcome was a final final written warning against the appellant for inappropriate behaviour. She appealed this sanction, but due to a period of maternity leave and various other factors, the appeal was not concluded until some 15 months after the incident. When the appeal was finally rejected, the appellant brought a claim for constructive unfair dismissal, claiming that the rejection of her appeal was the last straw in a series of acts which, taken together, amounted to a breach of the implied term of trust and confidence.

The employer successfully applied to strike out her claim. The judge at first instance decided that the disciplinary process and its outcome were unarguably reasonable and so there was no reasonable prospect of the appeal outcome constituting a ‘last straw’. On appeal, the EAT recognised a complication arising from the authority of Addenbrooke v Princess Alexandra Hospital NHS Trust UKEAT/0265/14, which had stated, ‘if there is subsequently conduct which, taken together with the employer’s earlier fundamental breach, causes the employee to resign or plays a part in the decision of the employee to resign, the later act effectively reactivates the earlier fundamental breach’. Although the appeal was dismissed, the Court of Appeal granted leave to appeal so as to properly review the ‘last straw’ doctrine and its interaction with the re-activation of ‘waived’ or ‘affirmed’ breaches.

The Court of Appeal this week dismissed the appeal and affirmed the well-known earlier decision of the Court of Appeal in London Borough of Waltham Forest v Omilaju [2005] ICR 481. The pertinent part of Lord Justice Dyson’s judgment in that case was cited in full as follows,

“19. … The quality that the final straw must have is that it should be an act in a series whose cumulative effect is to amount to a breach of the implied term. I do not use the phrase ‘an act in a series’ in a precise or technical sense. The act does not have to be of the same character as the earlier acts. Its essential quality is that, when taken in conjunction with the earlier acts on which the employee relies, it amounts to a breach of the implied term of trust and confidence. It must contribute something to that breach, although what it adds may be relatively insignificant. 

  1. I see no need to characterise the final straw as ‘unreasonable’ or ‘blameworthy’ conduct. It may be true that an act which is the last in a series of acts which, taken together, amounts to a breach of the implied term of trust and confidence will usually be unreasonable and, perhaps, even blameworthy. But, viewed in isolation, the final straw may not always be unreasonable, still less blameworthy. Nor do I see any reason why it should be. The only question is whether the final straw is the last in a series of acts or incidents which cumulatively amount to a repudiation of the contract by the employer. The last straw must contribute, however slightly, to the breach of the implied term of trust and confidence. Some unreasonable behaviour may be so unrelated to the obligation of trust and confidence that it lacks the essential quality to which I have referred.
  1. If the final straw is not capable of contributing to a series of earlier acts which cumulatively amount to a breach of the implied term of trust and confidence, there is no need to examine the earlier history to see whether the alleged final straw does in fact have that effect. Suppose that an employer has committed a series of acts which amount to a breach of the implied term of trust and confidence, but the employee does not resign his employment. Instead, he soldiers on and affirms the contract. He cannot subsequently rely on these acts to justify a constructive dismissal unless he can point to a later act which enables him to do so. If the later act on which he seeks to rely is entirely innocuous, it is not necessary to examine the earlier conduct in order to determine that the later act does not permit the employee to invoke the final straw principle. [Emphasis supplied]”

Effectively therefore, if the conduct complained of is continued by a further act or acts, in response to which an employee resigns, they can still rely on the totality of the conduct in order to establish the necessary fundamental breach. The obvious observation otherwise is that “it would be extraordinary if, by failing to object at the first moment that the conduct reached the Malik threshold, the employee lost the right ever to rely on all conduct up to that point.”

That being the case however, Underhill LJ agreed that the appeal outcome in the instant case was incapable of forming part of a cumulative breach. Had the conduct of the disciplinary process been seriously unfair, a tribunal would very likely have held that that was a sufficient repudiatory breach in itself, without the need to refer back to events of a different character some time previously. The appellant was – of course- entitled to believe the outcome to be wrong; but the true test is objective, and a fair disciplinary process cannot, viewed objectively, destroy or seriously damage the relationship of trust and confidence between employer and employee simply because the outcome was not desired by the employee.

For cases of constructive dismissal therefore, legal advisers (and tribunals) should ask themselves the five questions posed by Underhill LJ as follows:

(1)              What was the most recent act (or omission) on the part of the employer which the employee says caused, or triggered, his or her resignation?

(2)              Has he or she affirmed the contract since that act?

(3)              If not, was that act (or omission) by itself a repudiatory breach of contract?

(4)              If not, was it nevertheless a part (applying the approach explained in Omilaju) of a course of conduct comprising several acts and omissions which, viewed cumulatively, amounted to a (repudiatory) breach of the Malik term? If it was, there is no need for any separate consideration of a possible previous affirmation.

(5)              Did the employee resign in response (or partly in response) to that breach?

As Underhill LJ observed although none of the questions are conceptually problematic in and of themselves, “answering them in the circumstances of a particular case may not be easy.” The Magdalen Chambers employment team are on hand to assist for those difficult cases.


David Lidbury appointed to Sport Resolutions’ Panel of Arbitrators and Mediators.

David’s appointment will run from 1 April 2018 until 31 March 2021, alongside his usual busy practice.

Sport Resolutions is the independent dispute resolution service for sport in the United Kingdom. The Panel of Arbitrators and Mediators includes many of the top legal, financial, medical, safeguarding and sport administrator professionals working in sport. The Panel provides arbitration, appeals, investigations, reviews and mediation services to National Governing Bodies and other sports stakeholders in the areas of anti-doping, safeguarding, athlete selection, eligibility, corporate governance, sport disciplinary procedures, integrity issues in sport, commercial contracts in sport, employment and discrimination.

Christopher Naish

Procedure in private law fact finding hearings

All family advocates who undertake any private law children work will increasingly have to deal with the issue of fact finding.

The amended Practice Direction 12J places an increased focus on issues of domestic abuse and harm and widens the definition of domestic abuse to include coercive, controlling and threatening behaviour. In cases where such issues are raised, judges cannot simply ignore them and must determine the extent to which they may be relevant in deciding what child arrangements order to make. Frequently this will require a separate fact-finding hearing.

This is made more complicated in cases where both parties are unrepresented and even in cases where only one party is represented. Unrepresented parties may very well not grasp the evidential and procedural requirements for dealing with the issues.

In the recent case of RE J (Children) [2018] EWCA Civ 115, the Court of Appeal had to consider an appeal from a fact-finding hearing conducted by an experienced Circuit Judge where the father, who faced very serious allegations including an allegation of rape, was unrepresented. At the end of the appeal, the Court concluded that there were procedural errors which required them to allow the appeal.

At an early stage of proceedings, the Court had made a without notice injunction for a period of two years. There had never been a contested hearing to consider whether the injunction should continue. The injunction and Children Act proceedings were simply consolidated and so the injunction application was repeatedly adjourned over an 18 month period.

In the course of case management, the judge decided the following matters :

  1. An application by the father for his McKenzie friend to cross-examine the mother, a prospect which the judge said filled him with “profound disquiet” to put it mildly;
  2. That a fact-finding hearing was not necessary as the children (aged 11 to 18) were so hostile to the prospect of seeing their father, that the application could be determined without the need for a fact-finding exercise.
    The judge subsequently laid emphasis on two factors as justifying this decision :
    1. that this had been decided with the agreement of the parties; and
    2. that there was no prospect that the children would accept a judgment adverse to the mother and vindicating the father .

The father appealed on two main grounds : that there should have been a fact-finding hearing; and that his McKenzie friend should have been allowed to address the Court.

Interestingly the Court of Appeal did allow the McKenzie friend to address them on behalf of the father.

The following points are made in the judgment of McFarlane LJ :

  1. This judgment considers the effect of the latest version of PD12J issued in October 2017.
  2. The Court of Appeal expressly referred to the following paragraphs :
    • Para 5 : the need to identify at the earliest opportunity whether issues of domestic abuse arise; and to ensure that where they do, any contact is safe;
    • Para 7 : the requirement to consider whether the statutory presumption of parental involvement in a child’s life (section 1(2A) Children Act 1989) applies in this case.
      NB it does not apply where “there is some evidence before the court in particular proceedings to suggest that involvement of that parent in the child’s life would put the child at risk of suffering harm whatever the form of the involvement.”
    • Para 16 : the need to consider as early as possible whether there should be a fact-finding hearing.
    • Para 17 : sets out what must be taken into account in making the decision whether to hold a fact-finding hearing.
    • Para 19 : a reminder that matters must be determined as soon as possible and fairly and proportionately.
  3. The Court noted that in this case there were cross-allegations and it was said by father that mother had fabricated the allegations against him.In effect, therefore, the judge’s order left the children in the care of a mother who may have caused them emotional harm, without investigating the issue.
  4. The Court referred to a number of cases emphasising :
    1. The importance of avoiding delay; and
    2. The importance of making every effort to establish contact.
  5. In relation to cross-examination of an alleged victim the Court of Appeal said :
    1. That it would be very rare for a McKenzie friend to be allowed to cross-examine aan alleged victim : cross-examination of alleged victims required a very high degree of skill and sensitivity;
    2. The least worst option will usually be for the judge to question the alleged victim.


From this case, these principles can be drawn :

  1. Where there is a disputed injunction, it should be listed for a contested hearing as a matter of urgency. The Court referred to the latest guidance, namely Practice Guidance: Family Courts – Duration of Ex Parte (Without Notice) Orders [2017] Fam Law 332.
  2. The Court should not shy away from holding a fact-finding hearing. This is particularly important where there are serious allegations with cross-allegations of fabrication.
  3. Section 7 reports should not usually be ordered before the conclusion of the fact-finding exercise : if they are, the reporter cannot form an informed view on welfare without knowing what the facts are. This is emphasised at para 22 of the Practice Direction.
  4. There is a positive duty upon a family court ‘to grapple with all available alternatives before abandoning hope of achieving some contact’.

There is a sad footnote to this case : having determined that the judge had been wrong to refuse to hold a fact-finding hearing, the Court of Appeal concluded that it was simply too late to hold a rehearing, particularly given the ages of the children. The Court therefore affirmed the decision of the trial judge refusing the father any contact with his children.

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Practice Guidance: Standard Family Orders

The President of the Family Division circulates, for consultation, the second batch of Standard Family Orders (the first batch was issued with my Guidance dated 30 November 2017). Many of these have been in circulation for some time, some not, which is why on this occasion I have decided that there needs to be a short consultation.

The consultation will run for a little over ONE MONTH, until Monday 16 April 2018. Comments, suggestions for improvements and any proposed drafting amendments should be sent to me by email to this address

James Munby
President of the Family Division