What is the Law in Your Life?

5 things about asbestos risks in commercial property

Asbestos is a material that was widely used in the construction industry for many years due to its heat, fire and sound protection qualities. It has been illegal to use asbestos in the construction or refurbishment of buildings since 1999.

Asbestos is now recognised as a significant health hazard if disturbed and so building owners and occupiers must be aware of, and comply with, legislation that regulates its use, removal and management. Every person with an obligation to maintain or repair a property constructed before 1999 must take particular note of the asbestos regulations, and comply with them.

The following are 5 things to be aware of:

1.         The relevant current regulations are the Control of Asbestos Regulations 2012 (“the Regulations”) which came into effect on 6 April 2012 and an approved code of practice has been issued by the Health and Safety Executive ('HSE'). In common with other health and safety regulations, breach of the Regulations constitutes a criminal offence, punishable by an unlimited fine and/or up to two years imprisonment. Affected persons may also bring negligence claims against the duty holder.

2.       There is an obligation on the duty holder to (i) determine whether asbestos is present or is likely to be present in a building and (ii) manage any asbestos which is or is likely to be present. The definition of a duty holder is broad. It will apply to owners of “non-domestic premises” and to any tenants and sub-tenants thereof. These obligations can also extend to managing agents if they have taken over the repair or maintenance of a property. The obligations apply to vacant premises.

3.      The legislation does not define “non-domestic”, however the HSE has advised that a broad approach will be taken. It includes commercial premises, offices, retail premises, industrial premises, hospitals, schools, universities, prisons and places of worship.

4.         A duty holder must carry out a 'suitable and sufficient' assessment to determine whether asbestos or asbestos containing material is likely to be present in the premises. To do this, the duty holder must take account of building plans, other relevant information and the age of the premises. An inspection must be made of those parts of the premises which are reasonably accessible. In all cases, the approach taken should be proportionate to the perceived risk and a full survey may not be required unless work is planned which could disturb the asbestos. The duty holder must review the survey and record its findings in order to assess the risk. 

5.         If the survey shows that asbestos is or is liable to be present, the duty holder must determine the risk from that asbestos, prepare a written plan to identify the parts of the premises affected and specify the measures taken to manage the risk. The measures must include monitoring the condition of the asbestos and maintaining or removing any materials thought to contain asbestos. The information about the location and condition of the asbestos must be provided to every person liable to disturb it and to the emergency services.

Trade Secrets

Confidential information/trade secrets are currently protected through case law in the UK. In order to successfully claim for a breach of confidence, it is necessary to establish that:

·       the information has the necessary quality of confidence (i.e. it is not generally known by the general public, or persons who specialise in that subject);

·     the information was shared in circumstances imparting an obligation of confidence (i.e. a reasonable person would have realised that the information was being given in confidence); and

·      there has been an unauthorised use of that information to the detriment of the party communicating it (i.e. it has been used by the recipient for purposes beyond the consent of the owner, or it has been disclosed to third parties without the owner’s consent).

The UK implemented the EU Trade Secrets Directive (2016/244/EU) on 9 June 2018. There was previously no statutory definition as to what constituted a trade secret in the UK. In essence, a trade secret is a form of confidential information (all trade secrets will be confidential information, but not all confidential information need be a trade secret).  A trade secret is therefore a rarefied form of confidential information. The aim of the Directive is to harmonise the protection of trade secrets in all Member States. The substance of the Directive largely reflects the existing UK law on trade secrets.

The Directive introduces a new harmonised definition of a trade secret. In terms of the Directive, information will be considered a trade secret if it:

·      is secret – in the sense that it is not generally known among, or readily accessible to, persons who normally deal with this kind of information;

·       has commercial value because it is secret; and

·     has been subject to reasonable steps (under the circumstances) to keep it secret by the person lawfully in control of the information.

This definition should make it easier for businesses to protect their trade secrets but they must be able to demonstrate that they have taken “reasonable steps” to protect the secret if they wish to rely upon specific rights and remedies under the Directive.

As always with confidential information generally think before any disclosure is made. The quote from Jeremy Bentham in 1735 is as true today as it was then:  “Three men may keep a secret only if two of them are dead”.

What is the Law in Your Life?

5 Things you need to know about 3rd Party Rights:

1.    Scots law has always provided for third parties to be able to enforce contractual rights between others. This was called ius quaesitum tertio (“IQT").

2.    IQT was quite complex and difficult to identify and enforce on occasion –especially with regard to IQT created by implication.

3.   This has changed following the coming into force of The Contract (Third Party Rights) (Scotland) Act 2017 on 26 February 2018. This brings Scots law in line with English law.

4.   The new statutory framework replaces IQT and applies to all contracts entered on or after 26 February 2018. The Act does not have retrospective effect and does not affect existing contracts.

5.    There are specific conditions that have to be met for a third party right to be created under the Act. The parties to a contract may exclude third party rights by adding a clause to that effect in relevant contractual documents.

What is a distinctive shape?

For some years now it has been possible to apply for registration of 3D shapes as trademarks. The court battle between Nestlé and Cadbury over whether the 4-fingered KitKat bar could be registered as a 3D trademark illustrates some of the difficulties. 

The 5 key points:

1.    Nestlé applied to register their 4-fingered chocolate bar as a 3D trademark. Cadbury objected claiming that it lacked essential distinctive character.

2.    The case progressed to the Courts with judgment in favour of Cadbury. Nestle appealed.

3.   The Court of Appeal in England held that the shape lacked distinctiveness which would allow a third party to rely on it as an indicator of origin – i.e. that it would clearly be seen as having emanated from Nestle. In other words, it was not a “badge of origin”.

4.   While there have been successful applications for registration e.g. the Coca-Cola bottle shape, the courts have been reluctant to agree that there is essential distinctiveness without the manufacturer’s name or brand being embossed on it - as is the case with the KitKat 4-fingered bar.

5.    This case reinforces the need for care to be taken when creating new product design if reliance is to be had on 3D shapes. Trademark law is there to protect brands and trade names but a monopoly right is only granted if the legislative standards are met.

Cyber fraud in modern conveyancing transactions

There have been a number of recent incidents in which cyber criminals have diverted payments to and from Solicitor’s trust accounts.

The attackers gain access to the firm’s email system. There may be no outward sign of unauthorised access. The attackers wait, monitoring traffic and then when one party is due to deposit funds to a specified account, the request email is intercepted and the account number changed. The diverted funds can be money paid by clients to the Solicitor’s clients’ account, or money being disbursed from the Solicitor. Either way, this can have very serious implications.

This is a particularly dangerous attack as the instructions to transfer the funds is expected by the receiving party, and is genuine except for the changed bank account number.

Communications from the attackers seem credible and use appropriate language. Some of the affected email systems are hosted on the cloud, some on firm servers.

There have been attempts which have been detected – through vigilance or good luck. Others have been successful.

Once the criminals become aware the intrusion has been detected, the final stage can be a mass email to everyone on the firm’s contact list attaching documents containing malware links.

What can you do to minimise the risk? 

1. Avoid email to communicate bank account numbers, either in relation to deposits by clients or remitting funds to third parties.

2. If there is no other choice, confirm email instructions by direct contact with clients to confirm transfer instructions and the account numbers. 

3. Consider setting up an initial transfer of say £1 and advise the other party that if the Bank Account details change in any way they should contact you.

4. Know and follow good password and cybersecurity practices. 

5. The requirements for basic technical protection from cyber attacks are set out in the UK Governments Cyber Essentials Scheme.

Be vigilant!

Court of Session Update - CCHG Limited t/a Vapourized v Vapouriz Limited

This month saw the Court of Session in Edinburgh issue its judgment on the appeal brought by CCHG Limited, in the case of CCHG Limited t/a Vapourized v Vapouriz Limited. Both businesses supply e-cigarette products.

In addition to the importance of the outcome for both sides, the case had the wider significance of being the first appeal hearing to be heard by a Scottish court of a decision by the UK Intellectual Property Office’s Hearing Officer (‘HO’), under section 76 of the Trade Marks Act 1994 (Appeals from the registrar). 

In this case, CCHG, who trade as Vapourized, had sought to appeal the earlier decision by the HO to have the CCHG mark declared invalid, following an application by Vapouriz Limited. CCHG’s mark, the stylised words “VAPORISE INHALE THE FREEDOM” (https://trademarks.ipo.gov.uk/ipo-tmcase/page/Results/1/UK00003085823), was declared invalid by the HO on the grounds that it was similar to that of a rival brand with a previously registered trade mark (Vapouriz having previously registered an earlier mark for the same products https://trademarks.ipo.gov.uk/ipo-tmcase/page/Results/1/UK00002605137). The HO had deemed the CCHG mark to be similar to the earlier mark, for identical goods, and therefore gave rise to the likelihood of confusion.

In deciding on the appeal, Lady Wolffe, sided with the HO’s decision, indicating that she found no error in the HO’s assessment of the likelihood of confusion, nor was he ‘plainly wrong’ in the conclusion he reached.

CCHG will have the option of appealing the decision to the Inner House.

For the full judgment:

http://www.scotcourts.gov.uk/search-judgments/judgment?id=286a38a7-8980-69d2-b500-ff0000d74aa7 

400th anniversary of the creation of the Register of Sasines

Today marks the 400th anniversary of the creation of the Register of Sasines - the world's oldest national continuous public Property Register. Here are 5 facts describing the past, present and future of the Sasine Register:

1.  Prior to 1617, there was a system of public registration of instruments of Sasines and prior to that the instruments were recorded in the protocol books of notaries. Transfers of property were originally by symbolic delivery, by handing over earth or stone or some other symbol of the property being sold and then recording the Deed of Conveyance in the local Register of Sasines.

2.  The whole point of having a public register was to provide certainty and to regulate preferences - a job which the Register of Sasines has done very well. It has provided a solid platform on which Registers of Scotland can build for the future.

3. 1979 saw a major step forward with the introduction of registration of title in Operational Areas. Notwithstanding the clear challenges with the legislation, the 1979 Act was a necessary step in the development process.

4. The Land Registration etc. (Scotland) Act 2012 introduced a wholesale revision of registration of title in Scotland. There are those who lament the passing of the 1979 Act. It is suggested that the reforms introduced by the 2912 Act were essential for a progressive Land Register. The old system had its attractions but it needed an overhaul. The Sasine Register is now closed to transfer deeds, leases and standard securities and will be closed completely once the Land Register has been completed

5.  A series of innovations will be introduced in the coming years. The Digital Discharge Service is now operating; the first iteration of ScotLIS will be launched in October this year; and work continues towards completion of the Land Register. The latter is being done through a combination of compulsory registration of title on sale, voluntary registration (with a 25% discount in registration dues) and Keeper Induced Registration in terms of Section 29 of the 2012 Act.

Although some will no doubt disagree, it is a great time to be a property lawyer in Scotland.