On 9 May 2012, the Hong Kong's Securities and Futures Commission (SFC) launched a two-month public consultation on proposals to enhance its scrutiny of listing sponsors. Listing sponsors, typically banks or corporate finance houses, prepare a company's listing documents and perform due diligence to ensure compliance with relevant listing rules.   

The proposals, which combine new and existing sponsor requirements, will become part of the Code of Conduct for Persons Licensed by or Registered with the SFC. The proposed regime will increase the sponsor's responsibilities towards due diligence and disclosure. In particular, sponsors would have to be 'reasonably satisfied' that information in the prospectus is 'true, accurate and complete', and demonstrate that it was reasonable to rely on accountants’, auditors', valuers' and other experts’ reports in the prospectus. Although sponsors are not required to repeat the work done by experts, they would be expected to test the information provided in the reports to ensure that the information in the prospectus is 'credible and coherent'.  [Read More]

Financial planners (and their professional indemnity insurers) should take note of the deferral to the higher concessional contributions cap that the Federal Government (Government) had proposed in the 2010 to 2011 Federal Budget.

In a somewhat controversial move, the Government has delayed the continuation of the increased concessional contributions cap for people over the age of 50 with superannuation balances below $500,000.[Read More]

In the recent judgment of Kemp v Ryan [2012] ACTCA 12, the decision of a Master to refuse to order indemnity costs due to an unclear and uncertain Calberbank offer was upheld.  This is yet another reminder that care must be taken to ensure that any Calderbank offer is precisely drafted, unambiguously clear and conforms to the relevant legal principles. [Read More]

The Australian Securities and Investments Commission (ASIC) has recently released the results of its shadow shopping survey of financial planning advice. ASIC sampled 64 financial advices about retirement and found that 39% were poor, 58% adequate and 3% were of good quality.  [Read More]

A significant High Court judgment handed down yesterday held that seven former non-executive directors of James Hardie Industries (James Hardie) breached their duties by approving James Hardie’s release of a misleading statement to the Australian Stock Exchange (ASX). This decision (Australian Securities and Investments Commission v Hellicar; Brown; Gillfillan; Koffel; Terry; O'Brien; Willcox; Shafron [2012] HCA 17) provides confirmation of the ground rules for market disclosure by directors in Australia.  [Read More]

In the recent case of Commonwealth Bank of Australia v Hamilton [2012] NSWSC 242, the Commonwealth Bank of Australia (CBA) sought damages as a result of two defaulted mortgage loans. The CBA proved that Mr Webb, the borrowers' solicitor, breached a warranty of authority by directing the CBA to draw certain settlement cheques when Mr Webb did not have such authority. However, Mr Webb alleged contributory negligence against the CBA because of its poor handling of the loan documents.  [Read More]

We have previously reported with concern that the result of Perpetual v Milanex was that there could be no contributory negligence in a claim under the Fair Trading Act.  That outcome has been questioned in another decision from the Court of Appeal, Monaghan Surveyors Pty Ltd v Stratford Glen-Avon Pty Ltd [2012] NSWCA 94.[Read More]

On 7 December 2011, we reported on the Tax Laws Amendment (2011 Measures No. 8) Bill 2011. This Bill was aimed at countering phoenix activities by company directors.  However, certain provisions of that Bill had been removed in order to "allow further consultation … to ensure that the proposed amendments do not affect company directors inappropriately in certain circumstances".  That ‘further consultation’ is now underway and the Assistant Treasurer has released an exposure draft of legislation. To explore this material, click here.[Read More]

In the recent case of Provident Capital Limited v John Virtue Pty Ltd (No 2) [2012] NSWSC 319, the plaintiff lender sought damages from the defendant valuers due to an allegedly negligent valuation of a property. Briefly stated, the facts were that, in December 2004, the defendants valued a certain property at $12 million. The lender loaned funds to a borrower secured by that property; however, the borrower subsequently defaulted. A further valuation was obtained from the valuers in October 2005, after the borrower’s default, which valued the property at between $6.25 million and $7 million. The lender submitted that this was enough to establish negligence. The valuers denied negligence and submitted that the second valuation was irrelevant yet, in any event, there was no inconsistency between the two valuations such that no adverse inference could be drawn against them. [Read More]

We recently reported on a Victorian decision that upheld the doctrine of advocate’s immunity. Another case upholding that doctrine was handed down by the New South Wales Court of Appeal on 17 April 2012. It restated the doctrine that re-litigation of a controversy is not to be tolerated except in exceptional circumstances. Australia continues to go it alone in upholding advocate’s immunity.

The appellant alleged that he was injured during the course of his employment and commenced proceedings against his employer in the District Court. He was unsuccessful in those proceedings, both at first instance and on appeal. He then sued his solicitors and barrister.  

The allegation against the solicitor was that he failed to engage in settlement discussions. The allegations against the barrister related to inadequate preparation for trial, advice given in relation to steps preliminary to the trial and the conduct of the case in court. The appellant alleged that as a result of the breaches of duty, he lost the opportunity to recover damages against his former employer.[Read More]

Our insured clients often express cynicism about confidentiality clauses in settlement deeds, concerned that the other party will breach it with impunity. It can be difficult to allay their fears.

A recent New South Wales Supreme Court case, Missingham v Shamin [2012] NSWSC 288, was concerned with a deed that settled defamation proceedings. The deed included a confidentiality clause, which was promptly breached. The plaintiff, Mr Walter Missingham, sought a permanent injunction, damages and costs against the defendant, Mr Alex Shamin because Mr Shamin posted a copy of the Notice of Discontinuance and a letter on a website, thereby disclosing some of the terms of the deed. [Read More]

The China Insurance Regulatory Commission (CIRC) issued Circular 324 on 26 March 2012, stating that it will suspend market entry approval of certain insurance agencies. According to Circular 324, the affected entities include regional agency companies that are only licensed to operate in the province of their registration and all sideline agency companies other than banks and post offices.  

CIRC will not consider any licensing applications that are suspended by Circular 324 until it finishes amendment of market entry criteria and other related regulations. By the proposed 'amendment', it is expected CIRC will significantly raise the entry threshold, which may eventually squeeze out middle-small sized agencies and reshape the sideline agency market.[Read More]

Insurers will be interested in two liability cases following the February 2010 earthquake and tsunamis in Chile. One case dealt with the responsibility of the state for providing wrongful information concerning a tsunami warning. The other case was concerned with the responsibility of a construction company, which built an apartment block which suffered serious damage in the earthquake.[Read More]

Just a quick note to let you know that DLA Piper has launched a new publication for the insurance industry - (Re)insurance Quarterly.

This publication has been designed to keep you informed of developments in the Insurance and Reinsurance sector across Europe, the Middle East and Asia. You can view all articles from the first issue here.[Read More]

In the recent case of Superior IP International Pty Ltd v Ahearn Fox Patent and Trade Mark Attorneys [2012] FCA 282, the plaintiff applied to set aside a statutory demand served upon it by the defendant. However, this was far from the only issue that faced the court.

The court noted that the lawyers involved had not made any attempt to try and resolve the dispute in accordance with the Civil Dispute Resolution Act 2011 (Cth) or their ethical obligations as lawyers. Indeed, the lawyers had not discussed evidentiary objections, nor had they brought a copy of the Federal Court Rules 2011 or the Evidence Act 1995 (Cth) to court. This was surprising given that, although the statutory demand was for $10,706.33, the parties had filed approximately 450 pages of affidavit material (most of which was irrelevant).[Read More]