New Tax Appeal process

Under the Finance (Tax Appeals) Act, 2015, which came into effect on 21 March 2016, the Tax Appeals Commission replaced the Office of the Appeal Commissioners.

Taxpayers who wish to appeal against a decision or determination of the Revenue Commissioners need to complete a Notice of Appeal form which is available on the Tax Appeals Commission website.

For assistance in completing the form, see the Guidance Notes.

The completed Notice of Appeal should be sent by post to Tax Appeals Commission, Fitzwilton House, Wilton Place, Dublin D02 FX04 or email info@taxappeals

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Now, where did I leave my spare Bible, Koran, Tanakh ?

Earlier this month, President of the High Court ,Kelly reiterated that a bible or other religious text appropriate to the deponent’s religious belief must be produced for the deponent when the oath is being administered. The absence of such a text cannot be overcome by allowing the deponent to affirm rather than swear the affidavit. Under current legislation (Oaths Act 1888), an affirmation is only appropriate where the deponent objects to being sworn and states:

“as the ground of such objection, either that he has no religious belief, or that the taking of an oath is contrary to his religious belief…”.

President Kelly emphasised the role of the oath and the importance of trust in the solicitors’ profession. In administering an oath, a solicitor is exercising his/her duty under statute and as an officer of the court.

Practising solicitors have the power to administer oaths (section 72 of Solicitors (Amendment) Act 1994) and a bible or appropriate religious text should be available for this purpose.

72.(1) Subject to the provisions of this section, every solicitor who holds a practising certificate which is in force shall, subject to any condition to which that practising certificate is subject under the Solicitors Acts, 1954 to 1994 (in this section referred to as a “relevant condition”), have all the powers conferred by any enactment or statutory instrument (within the meaning of the Statutory Instruments Act, 1947 ) on a commissioner for oaths (including section 24 of the Stamp Duties Management Act, 1891) and any reference to such a commissioner in any such enactment or statutory instrument, whether passed or made before or after the commencement of this section, shall include a reference to such a solicitor, unless the context otherwise requires.
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Insurance companies blame compensation claims for rise in premium – are they being honest ?

In yesterday’s Irish Independent, Charlie Weston has questioned the recent claims by the insurance industry on the high levels of compensation as their reasons for increasing premia on policies. It’s a very thoughtful article and one the insurance industry could well take heed of.

Could it be said that they are being dishonest in their actions – behaviour they abhor when it comes to claims, yet suits them with their media spins.

Charlie says :-

“Official figures show the cost of premiums rose by 30pc in the last 12 months.

This means that a policy that had a premium of €500 on it last year now costs €650 to renew.

A family with two cars is paying an extra €300 a year in premiums.

Many of the State’s two million drivers are being hit with far higher hikes, especially if they have a claim on their policy, are a young driver, or have penalty points.

There have even been claims that the average cost of premiums could hit €1,000.

AIG, the world’s biggest insurer, said Ireland should consider banning such claims to avoid the average cost of premiums hitting €1,000.

Whiplash payouts account for up to 80pc of the volume of motor insurance claims in the Republic, compared with just 3pc in some other countries, according to AIG’s boss in Ireland, Declan O’Rourke.

Insurance companies are quick to blame our “compo culture” for the rise in the cost of premiums.

However, there are many reasons for the surge in the cost of car cover.

They include bad decisions made by insurers, new rules demanding that firms set more money aside in their reserves, poor regulation, more claims, and fraudulent personal injuries court cases.

All this means that ordinary drivers are being asked to carry an unacceptable burden.

Recently it emerged that the Central Bank has told insurers to raise premiums because they weren’t charging enough to cover claims costs and expenses.

All drivers are already paying a 2pc levy on their policies for the failures of the Quinn Insurance group, a combination of mismanagement by that company and poor regulatory oversight.

Six years later drivers are again paying up for the bad decisions of others.

The latest mess is the decision of the Court of Appeal that insurers pick up the tab for the collapse of Setanta Insurance, even though it was not regulated here.

Motor insurers are losing money because they made bad decisions about pricing and the level of reserves they have put aside for claims.

The industry engaged in below-cost selling and effectively blew itself up. It now wants honest drivers to bail it out for its calamitous decisions.

The situation is bad, but it is not inevitable that we will witness another year of monster premium rises.

There is some good news.

Aviva Ireland bucked the trend by making money in the general insurance market here last year.

It spotted three years ago that there was a problem with rising claims costs, and took action to raise its rates and aggressively to fight fraudulent and exaggerated claims.

The company made a profit of €40m last year in general insurance, which includes motor cover for private and commercial drivers and property insurance.

Profits were up 38.5pc when compared with the results for 2014.

And a number of personal injuries awards by the High Court have been halved by the Court of Appeal, with some criticism of the approach adopted by judges.

There have been a run of these reductions lately, experts said, in a sign that judges may be changing their approach to injuries awards.

Elevated court awards are a factor in the 30pc rise in motor insurance premiums, according to experts.

Jobs Minister Richard Bruton has pressed judges to tackle the problem of hugely inflated insurance premiums by sticking to new guidelines on compensation claims.

Mr Bruton held a meeting with the President of the High Court, Mr Justice Peter Kelly, in a bid to get judicial support for guidelines due to be published this summer.

All of this means that drivers need to ensure they do not just accept the word of insurers, brokers and regulators that motor cover rates have to keep rising to such an extent.

Drivers must challenge the elevated new premiums they are expected to pay and get a better deal by going to another insurer, or forcing their existing company to match a better offer they got elsewhere.

Enough is enough.”

Irish Independent

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UK consider Probate Court application fees based on value of the estate of the deceased person

The Ministry of Justice in the UK has a consultation paper out regarding fees for probate applications.

At present, applications for grants of probate are set at £155 when a grant of probate is sought by a solicitor and £215 when the application is made by an individual. This higher fee for ‘personal’ applicants reflects some of the additional administrative work that must be done by the Probate Service when dealing with applications made by individuals. Estates that require probate but are worth less than £5,000 do not have to pay a fee.

There are an average of 270,000 applications for a grant of probate each year in England and Wales, around 38% of which are made by individuals, and around 62% by solicitors.

Table 1: Proposed fee structure Value of estate (before inheritance tax)

Proposed Fee Up to £50,000 = £0

Exceeds £50,000 but does not exceed £300,000 = £300

Exceeds £300,000 but does not exceed £500,000 = £1,000

Exceeds £500,000 but does not exceed £1m = £4,000

Exceeds £1m but does not exceed £1.6m = £8,000

Exceeds £1.6m but does not exceed £2m = £12,000

Above £2m 0.4% £20,000

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Accident Injury Claims are lowest in Kilkenny

Since the Injuries Board’s inception, Kilkenny has been the county with the lowest number of injury compensation claims per 1000 in the Irish Republic. The Injuries Board Overview Report for 2015 confirms that !

The report into injury compensation claims handled by it is interesting. released on Friday, 1st April 2016, it states =

“The Injuries Board has published its 2015 annual overview which shows that 33,561 new personal injury claims were submitted to the Board last year. The 6% increase in new claims – compared to 31,576 claims in 2014 – reflects increased economic and social activity and is not unexpected given there are more people at work, higher traffic volumes and higher footfall in public areas.”

Key statistics for 2015:

• The Board made 11,734 personal injury awards and delivered €268.4 million in compensation.

• Awards for motor accidents continued to account for 3 out of 4 awards in 2015. The average motor award value in 2015 marginally increased by 1% to €21,470 (2014: €21,215). Motor awards continued to be the lowest average award value of all three claims categories.

• Employer liability awards accounted for 8% of total awards last year. While Employer Liability awards have typically attracted the highest average award value in recent years, in 2015 the average award for a workplace claim reduced by 3% to €31,267 (2014: €32,134).

• Public liability awards, for injuries resulting from accidents in public places, made up 17% of total awards in 2015, with a 2% increase in the average award to €25,213 (2014: €24,677).

• The average award processing timeline was steady at 7 months last year.

• Counties Limerick, Longford and Louth recorded the highest volume of awards on a per-head-of-population basis.

• Counties Kilkenny, Wexford and Wicklow recorded the lowest volume of awards on a per-head-of-population basis.

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When an insurance company goes bust – who pays ? The story of the Setanta Saga

Who was Setanta and what went wrong?

Setanta Insurance was a company set up in Malta that traded in Ireland selling exclusively car insurance. It would appear that it ran into some trouble in 2013 and by 16 April 2014, it could no longer trade and went into liquidation. This was unprecedented in Ireland in the sense that it was the first liquidation of an insurer limited to car insurance. 

There is little doubt that the regulators took their collective eyes off the ball.

So who was liable for the outstanding claims?

This is where the problem lies. The Law Society immediately identified the Motor Insurers Bureau of Ireland (MIBI) as the appropriate entity and advised its members accordingly. Indeed, the Minister for Finance initially told the Dail that he agreed with this before withdrawing this comment some time later, following legal advice.

The “unequivocal” legal advice received by the MIBI stated that the Insurance Compensation Fund (ICF) should pick up the tab and that the MIBI had no liability. 

The Law Society obtained its own legal advice which confirmed that the position was anything but unequivocal and that a strong case could be made that the MIBI would be liable. It subsequently engaged in considerable correspondence with the MIBI and the Department of Transport in efforts to see their legal advice, or at least identify its author, and to attempt to mediate what had become an impasse.

All such efforts were stonewalled and a position of implacability built up which is still in place over a year later.

What is the difference between the MIBI and the ICF?

The essential difference is 35% of the damages. If the MIBI are liable, then they must pay all damages. If not, then the ICF will discharge the liabilities but only up to 65% of the claim to a ceiling of €825,000. The remaining 35% would have to be sought directly from the policyholder or from whatever sums, if any, remained when the liquidation is complete several years from now. All legal costs should be payable in either scenario.

How did the dispute come to be litigated?

The President of the High Court is the controller of the ICF which is administered by the Accountant of the Courts of Justice. The ICF may only pay out where it is the fund of last resort. Given the uncertainty with the MIBI position, the Accountant, at the behest of the President, brought an application to the High Court seeking clarity on the role of the MIBI and the ICF in relation to claims against Setanta policyholders. The Law Society agreed to prosecute this action.

What was the result?

The case commenced last April and was heard in the High Court in July 2015. The decision of Mr Justice Hedigan was delivered on 4 September 2015 and emphatically debunked all of the MIBI arguments. It essentially confirmed that Clause 4.1.1. of the 2009 MIBI agreement meant what it appeared to mean, that where any judgment for damages, arising from a road traffic accident, remains unsatisfied for a period of 28 days, the MIBI must discharge it. The MIBI argued that this did not apply to insolvency whereas the Law Society produced considerable evidence that it did. 

What happened in the Court of Appeal?

The MIBI appealed and the hearing was expedited by the judiciary who recognised the urgency of the situation. The appeal was heard in January 2016 by President Ryan, Ms Justice Finlay Geoghegan and Mr Justice Hogan who gave judgment on 2 March and unanimously affirmed the order of the High Court and held that the MIBI’s liability under the 2009 Agreement extended to situations of insurer insolvency. Therefore, the MIBI has a potential liability for claims against Setanta policyholders subject to proof of liability in each individual case.

So what does this mean?

It is clear that where liability of the MIBI can be proven, it now must pay all claims. However, the extent of such liability is still somewhat nebulous. There are many cases in which judgment has been obtained and the MIBI is not a party to the proceedings as its involvement could not have been anticipated. The Court of Appeal has made reference to the difficulty that some claimants would have had in complying with conditions precedent in the 2009 Agreement and this obiter dicta is likely to be of importance.

And what of Setanta policyholders?

In the Court of Appeal, the judges made reference to what would be unfairness if anyone who, acting appropriately by obtaining insurance, was subsequently punished by the MIBI seeking recompense under the 2009 Agreement but, while this is undoubtedly persuasive, it is not binding given that it was not germane to the decision made.

Is this the end at last?

Sadly, it would appear not. The MIBI have publicly indicated an intention to make a further appeal to the Supreme Court  and in order to succeed in having the matter heard, it will need to persuade the Supreme Court that it is a matter of general public importance or in the interests of justice.

So, it would appear that the wait goes on for the 1700 claimants who have still received no compensation.

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Selling a property for in excess of €500,000 – Revenue clearance

Irish Revenue have amended their threshold for clearance for property sales in excess of €500,000.

An increase in the CGT threshold to €1million was introduced under section 42 of the Finance Act 2015 and came into effect on 1 January 2016.

This increased threshold applies solely in respect of disposals of residential houses/apartments, being defined as “including any building or part of a building used or suitable for use as a dwelling and any out office, yard, garden or other land appurtenant to or usually enjoyed with that building or part of a building”.

The €500,000 threshold remains in place as before for disposals of all other Irish land and buildings (including commercial property).

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Most Irish people are happy with their Lawyer

Before Christmas, the Irish Law Society commissioned research company RED C to survey the attitudes of the Irish adult population towards solicitors and the Law Society. The research is the result of a telephone survey of a nationally representative sample of Irish adults.

The research has provided us with some very positive results relating to client satisfaction. Chief among these is that the public reports high levels of satisfaction with their own solicitor. The research shows that 78% of clients are satisfied with the overall service delivered by their solicitor, with just 13% stating that they were dissatisfied. When asked specifically about whether they were satisfied with the quality of advice offered by their solicitor, 77% indicated they were satisfied, while only 12% indicated that they were dissatisfied.

These figures are promising, but what is most heartening is that a full 80% of the public are satisfied with how trustworthy their solicitor is. We know that people turn to solicitors for help at critical points in their lives. They may be having difficulties in the workplace, buying or selling a home, arranging a will to protect their loved ones, dealing with family breakdown or appearing in court. These are matters that are highly confidential, personal and sensitive. It’s essential that when facing these challenges, people have someone in their corner they can trust.

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Irish Water and selling your house – it’s really uisce beatha !

When Irish solicitors are selling houses on behalf of clients, we are obliged by law to ensure that there is no outstanding monies due to Irish Water. If we don’t do this and there is a bill, then, the solicitor has to pay it. Despite harsh criticism from the Irish legal profession on introducing such a burden on them, the government forged ahead with the obligation requirement in late 2015.

The obligation still remains irrespective of the recent speculation that the state body might be abolished.

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High Court sits in Kilkenny to hear injury claim cases

The High Court will sit in Kilkenny for two weeks, starting 29th February 2016, and decide on compensation claims in respect of accidents.All types of injury claims will be heard by two Judges in separate courtrooms.

Over 430 cases have been listed for hearing during this time.

All our clients, who have cases to be heard at these sittings, will be contacted later today to be advised of arrangements regarding the hearing of their cases; what witnesses will be called etc.

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