What is the Law in Your Life?

5 things you need to know about de facto company directors:

You have probably heard the term “de facto director”, but what does that expression mean?

1.   When a person is appointed a company director, their appointment is usually made by the company’s board of directors (or, sometimes, by the shareholders). Notification of the appointment should always be made to Companies House.

2.   However, a person may be deemed a company director without ever having been formally appointed as such or without their position being notified to Companies House. This is because such person has acted as a director, so as to become a director “in fact”- i.e. a de facto director.

3.   This is confirmed by the Companies Act 2006, which provides that the definition of a director includes “any person occupying such a position, by whatever name called”. A person occupying such a position without expressly being named as a director is referred to as a de facto director.

4.   The Court of Appeal in England has confirmed recently that there is no one definitive test for whether someone is a de facto director. In determining the matter, the court will ask whether that person was part of the corporate governance system of the company and whether that person assumed the status and function of a director so as to make himself responsible as if he were a director.

5.   It is important to note that if someone is deemed to be a de facto director, such person will be subject to the same duties and responsibilities (and face the same potential personal liabilities) as if they had been formally appointed a director.

What is the Law in your Life?

5 things you need to know about Insurance Obligations under a Lease:

1.   The landlord usually accepts the obligation to insure the leased subjects for specified insured risks.

2.   The tenant reimburses the landlord in respect of the premiums paid.

3.   The definition of the insured risks should be considered carefully so as to ensure that all relevant risks are insured against and that there is no element of double insurance.

4.   The landlord will generally have the obligation to reinstate the leased subjects in the event of damage to or destruction thereof - provided that said damage or destruction has not been caused by the act or default of the tenant.

5.   During any period of reinstatement, there should be rent abatement with the landlord receiving the benefit of loss of rent insurance effected in terms of the lease. The lease may provide for the termination of the lease if the leased subjects are not reinstated within a specified period. The common law of rei interitus is usually excluded from operation.

Completion of the Land Register in Scotland

Scottish Ministers have asked Registers of Scotland to complete the Land Register in 10 years, and have committed to registering all public land within 5 years. This follows on from the Land Registration (Scotland) Act 2012. 

Completing the Land Register will be a major undertaking and will require collaboration across the private, public and charitable sectors. A public consultation is now underway which will be completed later this year. See:

http://www.ros.gov.uk/consultation/consultation_land_register_completion.html

In order to complete the Land Register, additional levers for registration are likely to be required on top of voluntary registration and “Keeper-induced” registration under the 2012 Act. A fully transparent Land Register is a laudable goal and, although there will likely be challenges along the way of achieving it, Scottish Ministers are to be congratulated for giving this priority. There can be no doubt that this will have economic as well as social and legal benefits for citizens and should fit well with the Government’s aim of ensuring that Scotland is a modern e-enabled country which can demonstrate that is a good place for businesses to be located. 

A blog about the Norwegian Land and Information System

INFOLAND - simplifying the Norwegian property market

Norway has a population of five million people, with approximately 2.2 million homes and an average of two people per household. Approximately 150 000 property transactions are conducted each year. With Norway being the longest country in Europe, sparsely populated within an area of 324,220 sq km and almost one third of the land mass situated above the arctic circle, one might be led to believe that property transactions are slow and inefficient.

Norway’s property market has been more or less booming throughout the recent recession, much due to the fact that Norway’s banks reduced their interest rates on loans and mortgages in order to meet the changes to import and export markets hit by the economic downturn. This has supported a healthy economy and the average Norwegian suffered little or nothing financially, during the crisis. 

Two major players in the Norway’s property market

The property market has two major players: The real estate agent representing the seller and the bank providing the mortgage for the buyer. The various banking institutions in Norway own most of the real estate chains. In order to qualify as a real estate agency, education in business and property law is required. As the seller is represented by the real estate agent and no representation is required for the buyer, legislation demands that the real estate broker provide all information about a property to the prospective buyer before selling. This information is mainly collected from the local municipalities’ land and zoning departments, the land registry and the mapping authority. 

This could be a painstaking ordeal, but the real estate agent provides this information to the buyers through the land information portal, www.Infoland.no. This is a one-stop-shop for all information required by law in addition to other information of relevance concerning the property in question such as environmental issues, large-scale maps and much more. The largest provider of information is the local authority and the largest sector searching for information is the real estate agent, but surveyors, construction companies, architects and the private citizen also use the portal. Instead of time-consuming phone contacts or meetings, all information is searched, selected, and paid for online. The required information is usually made available within hours instead of weeks. 

High efficiency gains and quality service

Naturally, the efficiency gains are considerable. The local authorities save time and effort by handling all inquiries through one platform, and the estate agent can search for land information any time of the day or night. Infoland consists of a collection of suppliers, such as the municipalities and the land registry and the mapping authority, etc. Each supplier can follow the status of the orders through their own administration sites. Each supplier invoices Infoland on a monthly basis for the transactions that have been provided. Regular visitors to the portal can subscribe and be invoiced monthly for their transactions, whereas non-subscribers pay by credit card. 

To ensure the optimum quality of service, the supplier provides the information within the agreed upon period. Should the supplier not provide the information with the time limit, they receive no remuneration for their efforts. In this way, a true cooperation between the portal and all its suppliers is ensured.

No need to be digital to be a supplier of INFOLAND

The supplier can develop his digital portfolio as he goes and does not need to be digital to join the service. Using Infoland, the supplier responds to the orders either by providing instant pdfs or by finding paper files and posting them through the mail.

Solutions that simplify the market and make doing business quick and efficient are what spurs on a healthy economy, ranking Norway among the top 10 in the World Bank’s Doing Business Survey when registering properties. 


INFOLAND is provided by Norsk Eiendomsinformasjon AS, Norwegian Land Information, a limited company, established in 1987 belonging to the Ministry of Trade, Industry and Fisheries. The company provides the market with the digital land registry, digital document flow and conveyancing as well as other solutions that simplify the Norwegian property market. The article’s author, Trude B-J Margel, heads up the Global Enterprise Division and can be reached at: tbm@eiendomsinfo.no.

What is the Law in your Life?

5 things you need to know about the obligation for repairs under a Lease:

1.     The common law provides that a tenant repairs and maintains the interior of the leased subjects and the landlord is obliged to maintain the exterior including the roof. The common law rarely applies and is usually expressly overridden. Sometimes this is not done properly however.

2.     A repairing obligation in a lease will be interpreted strictly according to its terms so if the obligation is to include renewal and rebuilding, this should be stated expressly.

3.     The repairs clause must be read in conjunction with the insurance clause in the lease.

4.     Tenants should be advised to instruct a survey of the leased subjects before accepting a full repairing and rebuilding obligation. If there are defects, these should either be made good by the landlord prior to the grant of lease or else and exception made from the tenant's repairing obligation.

5.     An exception may be made by way if reference to an attached photographic schedule of condition evidencing the state of repair of the leased subjects.

What is the Law in your Life?

5 things you need to know about the new Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 which came into force on 13 June 2014:

1.  The Regulations apply to all consumer contracts namely, distance contracts (i.e. telephone or online sales), off-premises (i.e. door-to-door sales), and on-premises (i.e. in store sales) made on or after 13 June 2014. The Regulations replace the Distance Selling Regulations 2000 and the Doorstep Selling Regulations 2008.

2. The Regulations introduce changes affecting all consumer contracts including the following:

• The consumer’s express prior consent must be obtained before taking any additional payments (eg for insurance, premium delivery services, etc). Retailers must not use pre-ticked boxes on websites which result in payment being made by the consumer.

• Retailers cannot charge more than the basic rate to call a customer service helpline or to discuss any issue with goods or services which have been supplied. 

• Retailers must not impose excessive payment surcharges when a consumer pays by certain means (such as credit or debit cards) and businesses will only be able to pass on the actual cost for the payment method (e.g. the actual processing fee).

• A new concept of digital content is introduced into UK law (data produced and supplied online e.g. music downloads). Retailers of digital content are bound by the Regulations.

3.  The Regulations introduce changes affecting only distance and off-premises contracts including the following:

• The list of pre-contract information the retailer must give to a consumer has been extended. The information required will depend on the way in which the sale is made.

• Consumers have the right to cancel contracts for the supply of digital content (such as a music track) up to 14 days after the contract has been entered into.

• The cooling off period has been extended from 7 to 14 days after delivery (for goods) or after conclusion of contract (for services).

• The retailer must provide a model cancellation form where the consumer has a right to cancel a contract.

• If the retailer fails to provide certain pre-contract information, the cooling off period is extended to 12 months.

• On-line retailers must make clear where there is an obligation to pay (eg through a labelled ‘pay now’ button.

4.  The Regulations provide certain consumer contracts are excluded, or partially excluded, from the scope of the Regulations. These include contracts relating to: gambling; sale of houses; rental of residential accommodation; package holidays; certain financial services; and perishable goods.

5.   What does this mean for your business?


If you sell to consumers you should review your terms of sale and website as a matter of urgency. It is very likely that changes to processes and/or documentation will be required to comply with the new rules.

Failure to comply could leave you not only with an unenforceable contract, but may also lead to a criminal conviction and/or fine.

What is the Law in your Life?

5 things you need to know about Patents:

1.   A patent protects new inventions and covers how they work, what they do, how they do it, what they are made of and how they are made.

2.   It is a monopoly right for a product or process, granted by the State as a territorial right for a limited period.

3.   To satisfy the terms of the Patents Act 1977 and, therefore, the IPO, the invention must:

(a)  be entirely new. i.e. it must not have been disclosed in any form and must not be in the public domain;

(b) take an inventive step that is not obvious to someone with knowledge and experience in that field; and

(c)  be capable of being made or used practically in some kind of industry.

4.   Not everything can be patented.  Examples of items which are specifically excluded from patent protection in the UK are:-

(a)   a discovery, scientific theory or mathematical method;

(b)  a literary, dramatic, musical or artistic work or any other aesthetic work;

(c)  a way of performing a mental act, playing a game or doing business;

(d)   anything against public policy or morality;

(e)   the presentation of information; and

(f)    an animal or plant variety.

5.  To protect yourself prior to filing for a patent, any discussions or disclosures to third parties should be done under the protection of a Confidentiality Agreement if necessary.