What to watch in invoice finance

first_imgInvoice finance has grown enormously in the last decade after the banks had finally understood that they could not easily obtain a fixed charge over book debts. Rather than rely solely on a floating charge, banks realised that the safest way of financing the cashflow of a business is under a factoring or invoice discounting agreement. The increasing involvement of the banks has led to greater competition and reduced cost, which in turn has led to a shift towards discounting rather than factoring and a reduction in stigma attached to this form of asset-based finance. Due to the legal basis for this type of product, invoice financiers are particularly susceptible to fraud. Factors and discounters both rely on an assignment of the client’s debt, evidenced by an invoice sent to the factor or a notification sent to the discounter. To seek to reduce the risk to the financier’s interest in the proceeds of the debt, factoring and discounting agreements provide that all proceeds of debts paid by a debtor to the client are held on trust pending payment by the client to his factor, or payment by the client into a trust account maintained for the benefit of his discounter. Nonetheless, invoice financiers are frequently victims of various types of fraud perpetrated by their clients. These include the issue of ‘fresh air’ invoices to a factor that are not genuine and do not evidence true debts. The client may also dishonestly fail to give notice of assignment to the debtor so that he can demand payment and keep the proceeds for his own use. In the case of discounting, no notice of the assignment is given to the client, so discounters are also at particular risk from the client who diverts debtor payments for his own use rather than pay them into a trust account maintained for the discounter as agreed with the discounter. Once the financier discovers the fraud, it will have a number of avenues for recovery and it will require urgent action by its legal team. The financier will obviously seek to reduce its exposure by realising the bona fide book debts, but it will also enforce claims against a solvent client under the finance agreement, and possibly for fraud or breach of trust. The individuals implicated in the fraud will also be liable for deceit, conspiracy, and procuring breach of contract and, if they have received or dealt with trust monies, they may also be liable in knowing receipt and dishonest assistance. Of course recoveries will also be sought through any directors’ or corporate guarantees. However, the weak link in all of these causes of action is that they are personal and only give rise to a money judgment. It goes without saying that a judgment needs to be enforced, pending which the financier is at risk of the insolvency of the judgment debtor, whereupon he must prove as an unsecured creditor along with other creditors and subject to any secured creditors. So, although the lawyer will often be under huge pressure to ‘do something’, taking the easy option of chasing personal remedies will not necessarily be the best route for the client. The truth is that recoveries can often be enhanced by prompt and efficient action by a legal team who recognise the importance of the financier’s various proprietary claims. In the first place, and most obviously, of cardinal importance is the invoice financier’s proprietary interest in the debts. It is crucial that these are collected as quickly as possible before the quality of the ledger deteriorates over time. Secondly, assigned to the financier together with the debt are various ‘ancillary rights’, many of which are proprietary and which give rise to additional and relatively unexplored potential routes of recovery or sources of information. Of the greatest practical importance are those rights relating to information. All factoring agreements contain a provision that the factor will also own all books, computer data, records and documents on or by which the debt is recorded or evidenced. It is a great mistake not to seek these documents as soon as possible when initiating recovery claims in fraud, as they are often critical to identify and to enforce the right to payment of the debt. Sometimes the right to these documents even has to be enforced against administrators or liquidators who are reluctant to deliver up the relevant documents and records to the financier. Of course, even if a client is unable to deliver up such documents, his inability helps identify the extent to which the ledger is or may be fictitious. Thirdly, it should not be forgotten that the proceeds of any debts are held on trust by any recipient other than a bona fide purchaser for value without notice. Notice of the financier’s interest as beneficiary should therefore be given promptly to any person or bank it is considered may have received the traceable proceeds or product of the proceeds of the debts in the hands of anyone. Recipients may include co-conspirators, relatives or banks. Giving notice that the monies were diverted in breach of trust in favour of the financier will ensure that recipient will be liable for if he subsequently wrongfully misapplies the money. Again, all these beneficial rights should be protected by a proprietary injunction. It is because factors tend always to have proprietary remedies available that care should be taken to ensure that their full benefit is obtained. This is rare, because often the dialogue between the financier and his solicitor only involves a standard freezing order followed by a costly money judgment. Experience suggests that such orders are not always as effective as one might hope, particularly when the wrongdoer becomes insolvent. Accordingly, where possible, the relief claimed against the wrongdoer should include a proprietary as well as a freezing injunction, to protect not only the wrongdoer’s own assets but also those that can properly claimed to be owned by the financier. This reduces the risk of embarrassing and expensive failure to recover through the insolvency of the defendant.Simon Millsis a barrister who specialises in banking and finance law, insolvency and asset recovery at Five Paper chambers.last_img read more

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Legal expenses insurers win a point

first_imgIt is one up to the legal expenses insurers this week in the ongoing ding-dong over the extent of the insured person’s right to choose a lawyer. The European Court of Justice delivered its judgment in the Stark case, which the insurers won. The International Association of Legal Protection Insurance (RIAD) welcomed the decision, which they said ‘clearly shows that the insured’s interests, consumer protection and cost management measures of insurers can be attuned’. I wrote about this case when it was first referred to the Court last year. The facts are that Mr Stark, who had legal expenses insurance cover, lived in Landeck, Austria, some 600km from Vienna. On 24 March 2006, he, together with four others, brought an action before the Labour and Social Security Court in Vienna against his former employer. In order to ensure their representation before that court, Mr Stark and the other applicants freely instructed – not unreasonably – a lawyer with chambers in Landeck. His insurance policy had a ‘local lawyer clause’. Such clauses allow insurers to restrict the insured person’s freedom of choice to lawyers that are based in the district of the competent court in first instance – in this case, Vienna. So, Mr Stark should have gone to a lawyer 600km from his home, to save on reimbursement costs. That is because in Austrian civil procedure the court fixes the amount of the costs of legal representation on the basis of the federal law on lawyers’ tariffs. That law provides for higher tariffs if lawyers represent their clients outside the place where they are based. So Mr Stark’s lawyer from Landeck could charge a higher fee – in fact, the double flat rate rather than the single flat rate – to represent his client in Vienna, and the legal expenses insurer (it was D.A.S.) did not want to pay. They said that they would be limiting their cover to the costs normally invoiced by a lawyer established in Vienna. It turned out that the difference in fee was an amount of €3,000 – a not gigantic sum of money in absolute terms, but maybe it was so to Mr Stark. As a result, the Innsbruck court of first instance questioned whether ‘local lawyer clauses’ in legal expenses insurance policies are permitted. They come about through article 158k of the Austrian Code of Insurance Contracts which, freely translated, states: ‘2) The insurance contract may provide for a clause according to which the insured shall solely choose persons authorised to represent clients on a professional basis that are based in the city of the court or administrative body that is competent for the proceeding in first instance.’ The point arises for decision because article 4 of the directive on legal expenses insurance (87/344) states that ‘any contract of legal expenses insurance shall expressly recognise that: (a) where recourse is had to a lawyer or other person appropriately qualified according to national law in order to defend, represent or serve the interests of the insured person in any inquiry or proceedings, that insured person shall be free to choose such lawyer or other person’. The European Court of Justice was therefore asked whether the Austrian law is in compliance with article 4 of the directive. The Court held that it was in compliance. In particular, they said: ‘… freedom of choice, within the terms of Article 4(1) of Directive 87/344, does not mean that Member States are obliged to require insurers, in all circumstances, to cover in full the costs incurred in connection with the defence of an insured person, irrespective of the place where the person professionally entitled to represent that person is established in relation to the court or administrative authority with jurisdiction to deal with a dispute, on condition that that freedom is not rendered meaningless. ‘That would be the case if the restriction imposed on the payment of those costs were to render de facto impossible a reasonable choice of representative by the insured person. ‘In any event, it is for the national courts, if an action is brought before them in this regard, to determine whether or not there is any such restriction’. They went on to say: ‘Mr Stark was able to choose his lawyer without opposition on the part of his insurer. Furthermore, Mr Stark would be deemed to bear only the costs relating to the distance between the chambers of his lawyer and the place of the court having jurisdiction, which, subject to the assessment to be carried out in this respect by the referring court, does not appear, as a general rule, to be such as to hinder the freedom to choose his lawyer.’ In other words, provided the shortfall does not hinder the freedom to choose a lawyer – is €3,000 a hindrance? – legal expense insurers can impose such conditions. I predict the ding-dong will continue.last_img read more

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‘Diverse’ cargo mix for St Lawrence Seaway

first_imgExport cargoes in August consisted of general, containerised and bulk cargoes, with imports of aluminium at the ports of Oswego and Toledo, and wind turbine components at the Port of Ogdensburg.The ports of Chicago, Cleveland, Detroit, Burns Harbor (Indiana) and Milwaukee received shipments of steel and high-value project cargoes, comprising machinery and mechanical presses. Project cargo volumes handled so far in the 2016 shipping season at the Port of Indiana-Burns Harbor were up 66 percent, compared with the same period of 2015.”During August, our stevedores discharged numerous pieces of large machinery and specialised equipment for Midwest manufacturers. Cargoes included European generators, cranes and tanks,” said port director Rick Heimann. 2016 has also been a solid year for breakbulk shipments through the Port of Toledo, said The Great Lakes Seaway Partnership. “We’ve seen a lot of aluminium and project cargo so far this year,” said Joe Cappel, vice president of business development for the Toledo-Lucas County Port Authority, adding that the port has a good system in place for coordinating the movement of project cargoes through the region and on its inland waterways.Overall, the St Lawrence Seaway recorded a 7.5 percent year-on-year drop in cargo volumes during the period from March 21 to August 31. While dry bulk volumes were down almost 14 percent, steel slabs and other general cargo volumes increased by nearly 70 percent.   www.greatlakesseaway.orglast_img read more

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Professional bodies round on paid McKenzie friends

first_imgSolicitors and barristers have escalated their campaign against paid McKenzie friends, calling for a blanket ban on remuneration and warning against any moves that could give the public the impression they are regulated.In response to a consultation from the judiciary, the Law Society warned against plans to introduce a code of conduct to govern the behaviour of McKenzie friends or to incorporate practice guidance into the rules of court.The Society said this would imply that McKenzie friends are ‘quasi-regulated’ and could ‘inadvertently’ give the impression that the court is regulating them.Chancery Lane stressed that this is important because the advice deserts created by cuts to legal aid have led to a growing group of McKenzie friends operating as profit-making businesses.The response said: ‘Some of these try to associate themselves with the stature of legal professionalism while simultaneously rejecting being bound by professional responsibilities. Clients of such McKenzie friends are at risk of being misled as to the status of the person who they are paying for legal help.’It added: ‘It should always be easy for litigants in person to recognise the distinction between regulated legal professionals and non-regulated providers of services.’ The Bar Council said it is concerned that the development of a code of conduct would be a ‘step on the road to McKenzie friends seeking to portray themselves, wrongly, as part of the regulated profession’.Both bodies are seeking a ban on McKenzie friends receiving ‘any form of remuneration’ for providing legally reserved activities.The Society said: ‘The Legal Services Act 2007 is very clear that it is in the public interest for certain activities to be conducted by a legal professional who is regulated by an approved regulator. ‘It added: ‘McKenzie friends should only be granted the right to litigate in exceptional circumstances, and they should not view such circumstances as being a business opportunities.’ Law Society president Jonathan Smithers said: ‘Those who can afford legal advice will always get better value for money by instructing a solicitor or other legal professional.Both the Law Society and Bar Council supported the idea of changing the term McKenzie friend, but rejected the proposed alternative term ‘court supporter’. The Bar Council said it was concerned this term ‘might have connotations of an official position, which might enable the unscrupulous to market themselves as having a more formal role than is the case’.last_img read more

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Dentons reveals 9% PEP dip for UKMEA

first_imgDentons has become the latest global firm to post annual results, with figures showing a small increase in revenue but a near 10% dip in equity partner earnings.Figures for the UK, Middle East and Africa for the year to 30 April show the firm’s revenue stood at £166.4m, an increase of 1%. However, profit per equity partner dipped from £530,000 to £481,000 – a 9% decrease.Jeremy Cohen, Dentons’ chief executive for the UKMEA region, said a fourth successive year of revenue growth had been achieved against the backdrop of ‘some pretty volatile trading conditions in our core UK market’.He said: ’The UKMEA business continues to make good progress pursuing a strategy built around the three pillars of creating stronger ties with key clients, investing to develop a high quality lower cost platform to meet the needs of clients, and investing to grow UK market share.’Key highlights over the past year include appointments to 18 global panels, including being one of the 12 firms appointed to Tier 1 of the Central Government General Legal Services panel.The firm has hired 15 new partners in the last 12 months.last_img read more

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Pics Of The Day

first_imgOctober 12, 2015 Chief Antonio Brooklen and Vice Mayor Felicia Robinson take the lead during the Paint the City Pink Walk 1 of 16 Miami Heat Cheerleaders show their support with Vice Mayor Felicia Robinsoncenter_img amaica’s Ambassador to the United States, His Excellency Ralph Thomas accepts a State of Maryland Resolution from Senator Shirley Nathan-Pulliam (left) welcoming him as Jamaica’s twelfth ambassador to the United States at a welcome reception held in his honour by the Embassy of Jamaica at St Gregory Hotel in Washington D.C. on Thursday October 8. Sharing in the occasion (right) is Mrs. Sandra Dixon-Thomas, wife of the Ambassador. (Photo by Derrick A. Scott) Attendees at the 2013 Scholarship and Awards Banquet at Miami Marriot Biscayne Baylast_img read more

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The Bahamas passes Jamaica as a Top Caribbean Destination

first_imgA look at some of the top stories making the news today, June 7th, across your Caribbean-American community in South Florida.Here’s a look at our top stories.‘Invest Caribbean Now‘ is currently offering qualified developers with Caribbean-focused projects in the real estate, development, mining and energy sectors, an opportunity to pitch their projects to company executives. In recognition of National Caribbean-American Heritage Month, the private sector agency of the Caribbean is inviting companies to submit a completed executive summary for evaluation.Mayor Barrington Russell for the City of Lauderdale Lakes will discuss economic and social development amid addressing residents’ concerns during his annual State of the City address. The State of the City address will take place at Lauderdale Lakes City Hall on June 16th at 6 p.m.Locally based reggae artiste Stephen Marley is set to debut the second part to his 2011 album titled “The Revelation Pt. 1”. The release of ‘The Fruit of Life’ is set to be released July 22nd and assumes a different tone than the first featuring other national entertainers such as Waka Flocka, Pitbull, Wyclef Jean and Busta Rhymes, Iggy Azalea.In Sports, Florida native and Olympic swimmer, Alia Atkinson, has made history with a breaststroke time of one minute and 6 point 48 seconds. Atkinson became 10th in the world for the 100 meter breast stroke swim at the Tennessee aquatics June Invitational.Here’s a look at what’s TrendingBahamas has jumped to the #4 spot beating Jamaica in the top Caribbean Destination list for 2016. The Bahamas ranked among the top ten Caribbean countries in culture, entertainment, culinary and adventure. The rankings come from visitor reviews on TripAdvisor and social media.For Today’s Weather Forecast:Thunderstorms in Broward County with a high of 89 and a low of 77. In Miami-Dade, Thunderstorms as well with a high of 88 and a low of 78.For more information on these and other stories, visit caribbeannationalweekly.com. Remember to pick up this week’s copy of our Caribbean National Weekly at your nearest Caribbean – American outlet.last_img read more

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MIPI Alliance Updates the RF Front End Interface Standard to Aid Successful 5G Rollouts

first_imgThe MIPI Alliance, the international organization that develops interface specifications for mobile and mobile-influenced industries, has released the new MIPI RF Front End Control Interface (MIPI REFE) v3.0. The latest version of the world’s de facto standard interface for control of radio frequency (RF) front-end (FE) subsystems, MIPI RFFE v3.0 is designed to deliver the tighter timing precision and reduced latencies that manufacturers need today to advance the rollout of 5G around the world.Features in v3.0 bring significant new capabilities to the well-established MIPI specification. Since its initial release a decade ago, RFFE has been deployed in billions of devices, in virtually every device with cellular connectivity including handsets, smartwatches and automobiles, to name a few.The new version of the specification expands its applicability to 5G use cases beyond mobile, such as for automotive, industrial and the Internet of Things (IoT). Development of MIPI RFFE v3.0 was laser focused on satisfying the unprecedented requirements for tight timing precision and low latency in the 3GPP 5G standard today. In this way, the specification helps ensure that manufacturers’ 5G devices deliver the high-performance RF capabilities necessary to enable critical consumer and business features in emerging 5G application spaces.MIPI RFFE simplifies the design, configuration and integration of the increasingly complex RF front end – which encompasses the power amplifiers, antenna tuners, filters, low-noise amplifiers (LNAs) and switches – connecting with the modem baseband and/or RF integrated circuit (RFIC) transceiver. As the number of RF bands involved in both uplink and downlink communications has exploded in the rollout of 5G, the subcarrier spacing (SCS) windows among RF packets have narrowed.MIPI RFFE v3.0 addresses the decreased reconfiguration windows and lower-latency switching among various bands and band combinations demanded in the 3GPP 5G standard by delivering enhanced triggering features and functionality, which results in fast, agile, semi-automated and comprehensive control of individual RFFE subsystems. MIPI RFFE v3.0 utilizes multiple, complementary triggers to synchronize and schedule changes in register settings, either within a slave device or across multiple devices:Timed triggers—Allows for tighter, synchronized timing control of multiple carrier aggregation configurationsMappable triggers—Enables groups of control functions to be remapped to other triggers quickly and easilyExtended triggers—Boosts the number of unique triggers available in the RF control system and accommodates increasingly complex radio architecturesWith the enhanced triggering functions, MIPI RFFE v3.0 improves throughput efficiencies and reduces packet latency, while also improving the precision in trigger placement. For back-to-back triggering operations, for example, the specification delivers a 20x improvement in timing precision.Because MIPI REFE v3.0 is backward compatible with prior generations of the specification, original equipment manufacturers and device vendors can migrate to 5G systems more quickly and easily, without changes to the physical layer of the control interface. The RFFE specification was initially released in 2010 and has seen numerous revisions since that time. Each release has provided additional functionality for developers to aid in the demand for newer RF front-end features.last_img read more

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Bacolod starts 2-day COVID mass testing

first_imgLeonardia, however, made it clear that the “movement of essential goods and cargoes will remain unhampered. Mayor Evelio Leonardia said this proactive measure is part of the “O-Plan: One-Time, Big-Time”, a joint program with the provincial government of Negros Occidental and four other local government units (LGUs). “This is to restrict movement from and into the neighboring LGUs of Bago City, Talisay City, Silay City and Murcia, which are also participating in the mass testing program,” Leonardia said. Swab samples collected during the mass testing will be processed in five molecular bio-laboratories, including four in Bacolod and one in Negros Occidental, and will be released within 24 hours, according to Negros Occidental Provincial Economic Affairs consultant Alfredo Benitez. While health authorities conduct mass testing, Leonardia – through Executive Order No. 55 – enforced a lockdown in the city dubbed “time-out no movement period.” Everyone is required to stay home. Only those who will be granted special exemptions can move around, and exit and enter the city. BACOLOD City – The city government begins today a mass testing of residents for possible coronavirus disease 2019 (COVID-19) infection. A total 5,000 COVID-19 tests will be conducted in Bacolod City from Aug. 28 to 29 and another 5,000 in Bago, Silay and Talisay cities and Murcia town from Aug. 30 to 31.center_img There will be border checkpoints to enforce travel restriction. Businesses delivering essential needs are also exempted, he said. Also, all public markets in this city will be off limits to the public from Aug. 28 to 30. In Bacolod City, the COVID-19 laboratories are hosted by the Corazon Locsin Montelibano Memorial Regional Hospital, The Doctors’ Hospital, Bacolod Queen of Mercy Hospital, and the Philippine Red Cross Bacolod City-Negros Occidental Chapter. Meanwhile, Presidential Assistant for the Visayas, Michael Lloyd Dino, assured that any overflow in the swab specimens that cannot be handled by laboratories in Bacolod can be tested in Cebu, which he will facilitate./PNlast_img read more

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Are the Browns Still in the Mix for New York Giants WR Odell Beckham Jr.?

first_imgBrowns fans were giddy last night following along on twitter as various players from the team were teasing a possible ‘big move’ by the team which fans hoped meant that Giants wide out Odell Beckham Jr., might be coming to town.The Giants and Browns did make a deal on Friday, but Beckham wasn’t involved, as the Browns acquired pass rusher Olivier Vernon for guard Kevin Zeitler.Now with free agency a few days away, there’s more rumblings that Beckham might be back on the market, and once again Browns fans are wondering if there’s anyway a deal for the star wide out can get done.The Giants are still involved in trade discussions with Odell Beckham Jr., according to a source. One of the league’s best wide receivers remains on the market.— Jeff Howe (@jeffphowe) March 11, 2019While the Browns and Beckham have been linked for awhile, there’s going to be a number of teams that are going to be in the mix for Beckham (the 49’ers are a team that would love to grab him), the question is can the Browns pull it off, or will the price be too high for them to make a deal for the 26-year-old? Matt Loede has been a part of the Cleveland Sports Media for over 21 years, with experience covering Major League Baseball, National Basketball Association, the National Football League and even high school and college events. He has been a part of the Cleveland Indians coverage since the opening of Jacobs/Progressive Field in 1994, and spent two and a half years covering the team for 92.3 The Fan, and covers them daily for Associated Press Radio. You can follow Matt on Twitter HERE. Related TopicsBrownsfeaturedGiantsOdell Beckham Jrcenter_img Matt Loedelast_img read more

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