My Bell Strategies Presentation

Good morning, everyone, my name is James-Guy Jacobs and I’m a partner in the property department of a City based firm called Healys. Healys actually has two offices, a large office just off High Holborn and a smaller office based in the centre of Brighton. The property department is spread over both offices and – including the commercial property team - is around 30 strong, so that’s pretty big.

Although I’ve only been at Healys for 4 months, before I was at Healys, I was with another Chancery Lane based law firm, for 18 months, where I headed up the property department which specialised in Stamp Duty Land Tax (SDLT) mitigation strategies. All in all, I’ve worked closely with Raj Kapoor for around 2 years and I’ve overseen over a thousand SDLT savings transactions.

I think mainly for this reason, Bell Strategies’ director, Neil Bowker asked me to speak this morning for around 10 minutes about SDLT mitigation strategies from, if you like, a solicitor’s point of view. Now, at this point, I must make an important disclaimer which is what I’m about to say is purely my opinion and you’re more than welcome to completely disagree with me, or just ignore me.

I did speak – very badly – off the cuff, for a few minutes here, a few weeks ago, at a similar seminar. At the end of my speech, I asked people to feel free to come up to me after the seminar and ask me whatever they wanted. In fact, quite a few people did and they all asked me the same question. Why are solicitors so obstructive? Repeatedly, I was told of examples where solicitors ruined a perfectly good deal and refused to adopt any kind of commercial stance.

Now the thing is, I always end up agreeing with anyone who makes comments like that. That kind of thing does happen all the time. But there are good reasons why solicitors are obstructive and behave the way that they do. I’m going to try and explain why that is this morning and also how best to sidestep the difficulty.

But before I do that, I want to talk about the main subject of today’s seminar which is tax planning, or, more specifically, SDLT savings arrangements. Now on the face it, the decision whether to go down the SDLT planning route is just an absolute no brainer. Simplifying only slightly, if you do it, it’s extremely likely the planning will succeed. If the planning doesn’t succeed, you’ll just end up in the same position as if you paid SDLT in the first place.

After 9 months and 30 days, if you haven’t heard anything from HMRC, your planning has effectively succeeded – unless HMRC  can somehow show that the acting solicitors failed to make a material disclosure which bearing in mind we have to file what is known as the SDLT1 return, would be extremely difficult for HMRC to establish. If you’re familiar with this return, it asks you to detail all the relevant aspects of the transaction for HMRC purposes.

The latest forms of planning – which I’m not here to explain – namely the Unlimited Company Scheme, the Delayed Sub Sale and the Option Agreement – are all exceptionally robust, especially the last two – and represent an absolute nightmare for HMRC to argue against.

I’m really not being complacent but I have to say from a legal point of view, the recent schemes are very clever. They are superbly devised by top Counsel and are good, really good. Also, I must add here, that the support offered by Raj and the whole Bell Strategies team is excellent. They do an outstanding job.

Ok, so, we’re now left with a fundamental question which is if SDLT planning is such an obvious no brainer, why are there so many people who need a large amount of persuading or reassuring as to its merits and many others who frankly won’t touch it with a bargepole. Furthermore, on a purely professional level, why are there so many solicitors who either hate it, or are terrified it?

I tend to make a clear distinction between clients that are referred to us and our own clients and contacts that we approach off our own back. Clients that are referred to us have pretty much decided that they want to the planning and frankly don’t need much more convincing. They may need a bit of clarification on a couple of issues but there’s no problem.

However, when it comes to our own clients or contacts that – for want of a better expression – we are approaching cold, I find many of them can be very hard work and the reason for that is they are frequently governed by something else. That something else is what I call emotive reasoning. 

Tax has always been an emotive issue. The papers are forever attacking people, especially what they perceive to be wealthy people, for not paying enough tax and praising those who do pay all their tax or offer to pay more tax. A good example of this is last week; the American papers were attacking Mitch Romney for paying hardly any tax and at the same time, praising Bill Gates who said he wasn’t paying enough tax. Tax is in the headlines virtually every other day. Look at the big story at the moment; it’s all about Harry Redknapp. Our ‘arry might write like a 2 year old but he was allegedly being paid £35 - £40k a week at Portsmouth and – allegedly – without telling his accountant or advising HMRC, paying healthy bonuses to his dog. And this is nothing new – remember Lester Piggott and Ken Dodd? Al Capone? Not paying all your taxes raises negative connotations, not only in the media but also in the public imagination.

Once you start talking about tax, you are travelling into the world of emotion and emotional people frequently do not behave completely rationally. Now I have so many truly fabulous examples of clients behaving irrationally when it comes to this particular area, it’s almost impossible to know where to begin. So I’ve decided to take the most recent example of client behaving in an irrational way – and that is the completion I did yesterday. The client – who obviously I won’t name – completed yesterday on a new build for £315,000. It was her first purchase and her finances were very tight.

When I sent her a completion statement showing the balance due from her to complete, she went through it with an exceptionally fine toothcomb and found that the seller’s solicitors had made a mathematical error in the service charge apportionment and they were 84p out. She insisted that this was rectified immediately. Then, she sent me a beautifully constructed and well researched email explaining that Healys did not need to charge the fixed fee of £35 for a CHAPS transfer because if we used another internet based transfer system, it would cost only £20.

Ok, so you get the idea. If she could save 84p here, or £15 there, this represented good value. However – and I’m sure you can guess what’s coming – if she used the SDLT mitigation scheme, she would have saved herself £3,780. But when I suggested it to her at the beginning of the transaction, she immediately ran off to her uncle, who was a long retired accountant. He helpfully told her that if she used the scheme, the Inland Revenue would repossess her new house and she was quite likely to end up in prison for an indeterminate period – and she believed him. When I told her that that he was talking complete rubbish she didn’t believe me. And I honestly couldn’t be bothered to argue with her, it wouldn’t have a made an iota of difference if I did.

This is not an uncommon or extreme example. Daily, I see perfectly intelligent people behaving in a perfectly unintelligent manner when it comes to tax planning. Because you are talking about the Government, the Inland Revenue and substantial sums of money, people tend to behave emotionally and irrationally. They can’t help it; in fact, we all probably do it to some degree.

People begin to be governed by their emotions. They’re frightened of the Inland Revenue, distrustful of professionals – even Queens Counsel and senior barristers. If Daddy or Auntie is a retired or old school accountant or solicitor, then their word is gospel. Never mind that they can save 5, 10, 20, 50 thousand pounds. The bigger the sum, the more irrational they get, I see it all the time.

I find the best way to combat this emotive way of thinking is to calmly attempt to make the purchaser think rationally. Explain why their fears are groundless. They’re not going to go to prison or be taken away in the middle of the night or transported to an Eastern colony where they’ll never be seen again. The Inland Revenue is not going to repossess their house or pursue them to the end of days. The arrangements have a phenomenal success rate. In the extremely unlikely event, that the arrangement does not succeed, the limit of their liability is the repayment of their SDLT savings and a nominal amount of interest. I find it’s always a good idea to talk about the insurance arrangements that are inbuilt into the scheme and – of course – it very much helps to continually remind the purchaser how much they will be saving if they use the arrangement!

However, the Inland Revenue will try and do exactly the opposite. It’s very difficult for the HMRC to argue against these schemes on a purely legal basis, certainly not in a language that the layman easily understands. From a legal point of view, they can’t stop these schemes unless they repeal the Finance Act of 2003. And that’s a very difficult route for them. Firstly, it would represent a major political embarrassment. It would be an admission that SDLT failed. This would be on top of other severe embarrassments HMRC has suffered in recent years. Secondly, the amount that HMRC loses to SDLT savings schemes is a drop in the ocean to them; HMRC is raking it in with many other taxes, including CGT and IHT. As it stands, the current Finance Act works pretty well for the Government. Thirdly, it would be expensive, slow and painful for them to repeal the Act and there is no guarantee that what they put in its place would be any better.

So, the Inland Revenue prefers to save itself a fortune and the fight the battle not on the rational, legal front but on the irrational, emotive front. And it can be pretty effective. We all know what they do. Every couple of weeks, articles will appear in, for example, The Mail, The Telegraph, The Times, The Financial Times, The Mirror, the BBC website and various other forums on the web  – basically rehashing the same old nonsense but which is designed specifically to scare anyone who’s considering using an SDLT savings scheme. It doesn’t matter where the article appears it always says the same thing. More and more of these selfish people are depriving the government of Stamp Duty Land Tax, money that should, in this time of austerity, be spent on schools and hospitals. They might think they’re being clever but HMRC is an omnipotent, omnipresent force and it will be coming for every single one of these tax shirkers and the Lord have mercy on them when HMRC comes a knocking. Any kind of loophole is always “just about to be closed”. And all those so called lawyers and tax advisers that tell you everything’s going to be alright and there’s no danger in using these savings schemes are quite simply lying.

You see they’ll appeal to the emotions. I don’t know if any of you have ever seen the 2008 film, Taken, with Liam Neeson. In the film, Liam Neeson plays a retired CIA agent who relies on his old skills to save his estranged daughter who gets kidnapped in Paris. Now, there’s a fantastic and quite famous scene in which Neeson talks to the kidnappers of his daughter on the telephone and he says:

“I don't know who you are. I don't know what you want. If you are looking for ransom, I can tell you I don't have money. But what I do have are a very particular set of skills; skills I have acquired over a very long career. Skills that make me a nightmare for people like you. If you let my daughter go now, that'll be the end of it. I will not look for you, I will not pursue you. But if you don't, I will look for you, I will find you, and I will kill you.”

This is effectively the HMRC line. Pay your SDLT and that’ll be the end of it. If not, they will find you and they will kill you – alright, not kill you but they’ll sort you out. However, in fact the reality is quite the opposite, HMRC is dreadfully cash strapped and overburdened. It’s exceptionally unlikely that a purchaser utilising the SDLT savings scheme will face enquiries, even if they do, HMRC would have a nightmare establishing that SDLT should have been paid and even if they did because of the inbuilt insurance protection, the purchaser’s liability is restricted to repaying their saving with a nominal interest payment.

I can say this because every single day, I’m on the front line and I can see exactly how effective they’re being. And as for the HMRC line that solicitors don’t warn of the risks of implementing the scheme, that’s completely untrue. We explain the downside very clearly, both verbally and in writing.

HMRC might like to think of itself as Liam Neeson but its fantasy. So far, it’s only managed to take one case in respect of an SDLT savings arrangement to Tribunal and it lost. And as I said before, SDLT planning schemes are considerably more robust now than they were. They are being refined all the time.

So now back to solicitors. I am an example of a solicitor who for many years would not touch an SDLT savings scheme. I saw them as dodgy, even though I had no knowledge of how they worked. Three years ago, I would have advised any prospective purchaser not to go anywhere near them. I would have said they were illegal.

But the thing is, I was a typically obstructive solicitor because – until I met Raj – I didn’t know anything about SDLT savings arrangement and – more importantly – I wasn’t interested in them either. Even after I met Raj, it took me, personally, a long time to become fully convinced of the merits of the arrangements and then - when I got to that stage - I had to leave the firm I was at in Westminster because they didn’t want to be associated with these schemes. I must stress here that this was nothing at all because the Westminster  firm thought the schemes were illegal or anything like that, it was simply because they were very conventional or old school and saw the schemes as somewhat distasteful. And I still find this all the time among solicitors.

Solicitors, especially property solicitors, are extremely cautious people. To make any money in their game, they have to simultaneously manage a large number of frequently stressful cases and any kind of slip up can result in a negligence action. Negligence actions are dead serious for solicitors because they can result in the cost of their professional liability indemnity increasing to an astronomical level. This can sometimes even put them out of business.

Property solicitors are bullied and scared by the Council of Mortgage Lenders with their extensive and ever increasing regulations and by their own professional body, the Solicitors Regulatory Authority who arguably appear to hate solicitors more than anyone else combined. Every time I pick up the Gazette, another solicitor is being jailed for this or that. The upshot of this is that numerous solicitors are really very worried about doing anything unless it is white than white and their backside is not on the line in any kind of way.

When an old school solicitor criticises SDLT saving schemes, they talk from a position of ignorance and prejudice. Ask them what an Option Agreement is and they wouldn’t have a clue, although I’m sure they’d be happy to tell you that the people who devised it are charlatans.

The only way you can get a solicitor on your side is if they are from a trained panel firm. Otherwise, you run the risk not only of an obstructive professional but a clumsy one too because a failure in the implementation of a scheme by a solicitor is the most likely cause of an arrangement failing.  I’m not here to advertise the services of Healys but we are a trained panel firm. We have undergone our due diligence to an exhaustive level and know what we’re doing. Employing solicitors that are not on the Bell Strategies panel can cause you all sorts of difficulties, including premature ageing.

Anyway, I appreciate that I’ve approached the subject of tax planning from a subjective and slightly unconventional angle but I do hope that I’ve shed a little bit more light on the legal profession and SDLT saving arrangements generally. However, please feel free to talk to me after the seminar. Thank you so much for your time.

Don't Say A Word

An obvious universal truth is that, unless you have divine perspective, you can never see the full story. Here's another unremarkable one. Life is unscripted and therefore inherently unpredictable. This hampers the dubious work of experts and forecasters. However, what always strikes me is how the nature of reality is in such contrast to the vast majortity of films and television series. Once you introduce a script, you normally end up with complete nonsense. It might be greatly enjoyable, well made and beautifully acted nonsense but still very much nonsense.

There are so many perfect examples, it's almost impossible to know where to begin. However, I'm just going to take the last two films I saw on television. The first one is the 2001 film, Don't Say A Word, starring Michael Douglas and Sean Bean which I watched on Film Four last Saturday night. To prove how bad this film is, all I need to tell you is the beginning of the plot. Sean Bean kidnaps Michael Douglas's daughter. Based solely on this information, anyone can easily work out how the film will develop and end.

To prove this theory, I gave my wife the film's tiny summary and this is how the conversation ensued:

WIFE: Right, well, Sean Bean is the baddy and has a silly, Sheffield accent.
ME: Yes
W: Michael Douglas plays a loving father who, against all the odds, out foxes Sean Bean.
M: Yes
W: At the end of the film, Michael Douglas fights it out with Sean Bean.
M: Yes. And?
W: Michael Douglas kills Sean Bean and in the final scene you see Douglas walking off into the sunset holding his daughter.
M: That's it, exactly.

Pathetic, really. Now let's try the same exercise with the 1994 film, The Specialists, which I saw last night, starring James Woods, Sharon Stone and Sylvester Stallone. This film is so predictable that you don't even need a summary. Sly Stallone is obviously the goodie, who kills James Woods, the baddie, at the end of the film and wins the girl, Sharon Stone. The rest, as they say, is mere commentary.

Television series are even more formulaic.

Columbo/Quincy/Magnum/T J Hooker etc always get their man. In soap operas, whenever someone kisses some else at an inappropriate time, someone even more inappropriate will always wander in and the episode will end on a terribly tedious cliffhanger.

To be fair, many books have been written lampooning the essential silliness of films. The writer, Joe Queenan, does it better than most and I would heartily recommend any of his books. The film business is rooted in fantasy and escapism and it's not suprising that the resulting product is generally very silly. However, there are some notable exceptions.

At the same time that Don't Say a Word was on Film Four, Channel Four was screening The Departed which won the Best Picture Oscar in 2006 for the brilliant British producer, Graham King. The film is set in Boston and is about an undercover agent in the Irish Mafia. It was expertly directed by Martin Scorsese and featured a stellar cast including Jack Nicholson, Matt Damon, Leonardo DiCaprio, Martin Sheen and Mark Wahlberg. Apart from Ray Winstone's laughable American accent, everything about this film is really good but the best thing is that it blurs the traditional goodie and baddie roles and you can never work out how the film will turn out. Indeed, to borrow a cliche, William Monahan's tremendous script packs a real shocker at the end (I won't ruin it for you if you haven't seen it!).

Unfortunately for every Departed, there are a thousand Don't Say a Words, for every Sopranos, a hundred thousand Columbos and for every District 9, a million Avatars. I suppose there's another universal truth in there somewhere. You have to swim through oceans of mediocrity to discover a single gem.

Griffin v Powell

In 1987, I made the headlines of the BBC1 9 o'clock news. The occassion was a speaking visit to the Bristol University Student Union by the famed right winger, Enoch Powell which ended in a near riot as students united from all parts of the country to demonstrate against him.

I wasn't a demonstrator. In fact, the only reason I had gone to the Student Union that day was to play table football. When I got to the Union, at around 1pm, the main entrances had been blocked off so, frustrated and confused, I tried to get into the Union through a little known side door. However, the police intervened and escorted me back to the front of the Union.

By this time, the main entrances were becoming increasingly packed with venomous students who were literally baying for Powell's blood. Soon there were so many students, I was swept into the Union and pushed to the edge of the main staircase. For a few more minutes nothing much more happened as the Union became increasingly more noisy and crowded.

Then, suddenly, the whole atmosphere became very much noiser. I've heard 110,000 fans screaming at the Nou Camp stadium, in Barcelona, but that was nothing compared to the decibel level I now encountered. True, a large number of students were screeching and whistling at the top of their vocal range. However, there was something else that's more difficult to describe. Every single student seemed to project the most intense hatred possible and it appeared to massively magnify the sound. In short, it was terrifying.

Then, in the middle of it all, twenty, maybe thirty police officers forced a path open and Enoch Powell appeared in the centre of the pandemonium. Even though he was in his mid seventies, Powell walked fairly quickly and mounted the staircase. I'll never forget his face, it was a picture of absolute, steely determination. For me, it was very hard to reconcile. How on earth could this man be so convinced that he was correct when, without the strong police presence, the masses would have literally torn him to shreds and probably eaten him too, for good measure?

Later that evening, I watched the BBC coverage with my friends. The BBC commentator advised the audience that minutes before Mr Powell turned up, there had been a concerted effort by students to break into the side entrance of the Union to sabotage the talk. The footage then panned to a close up of my bemused face as I was led away by the police.

In fact, this wasn't my first encounter with Enoch Powell, it wasn't even my second. I had already seen him speak twice at my school, University College School, in 1982 and 1984. For the first visit, there was a huge amount of excitement about the forthcoming speaker and I did my homework.

Brigadier Enoch Powell MBE (1912-1998) was born in Stechford, Birmingham. Before turning to politics, he was an academic, linguist, soldier and poet. He became a Conservative MP between 1950 and 1974 and an Ulster Unionist MP between 1974 and 1987. He was controversial throughout much of his career and his tenure in senior office was brief. He had strong, distinctive views on monetary policy, national identity, immigration and United Kingdom's entry into the European Economic Community which later became the European Union. He was dismissed from the Shadow Cabinet for his controversial and widely remembered 1968 "Rivers of Blood" speech in opposition to mass Commonwealth immigration to Britain.

Although I immediately found Powell's views on immigration to be very offensive, I was fascinated by how incredibly clever he was. Whilst at Trinity College, Cambridge University, in one Greek prose examination lasting three hours, he was asked to translate a passage into Greek. Powell walked out after one and a half hours, having produced translations in the styles of Plato and Thucydides. For his efforts, he was awarded a double starred first in Latin and Greek and then become a Professor of Greek at Sydney University, aged only 25.

Watching Enoch Powell speak for the first time was an extraordinary experience. I was only 15 and it became seared in my memory. Powell was famed for his oratorical brilliance and I was hypnotised by him. He spoke without notes, never pausing once and seemed to possess endless knowledge and intelligence. I have subsequently seen many famous politicians and statesmen speak and - apart from Margaret Thatcher - there really was no one in his league.

Interestingly, when he gave his infamous "Rivers of Blood" speech, it caused very little reaction among his audience. It was only after the speech was publicised and scrutinised, that it caused such intense outrage. I'm sure the reason was that Powell mesmerised his audience in the same way that he held me as a teenager.

Powell spoke again a couple of years later at my school in a debate with the then headmaster, Giles Slaughter. I thought Mr Slaughter was very brave to take on Enoch Powell and indeed he did credibly well but Powell was once again as brilliant as he was two years ago.

The angry scenes I encountered outside the Bristol University Union in 1987 were repeated a couple of weeks ago outside the BBC Television studio in White City at the notorious Question Time featuring Nick Griffin. Indeed, during the Question Time itself, Jack Straw referred several times to Enoch Powell and the "Rivers of Blood" speech.

To my mind, there are one or two interesting comparisons between Griffin and Powell. Nick Griffin holds shameful and disgusting views but he is also a clever man. He went to Downing College, Cambridge University but - unlike Powell - only succeeded in obtaining a Lower Second in Law. Whilst a student, his affiliation with the National Front was revealed during a Cambridge Union debate and his photograph was published in a student newspaper. Undeterred he later founded the Young National Front Student Organisation.

Both Powell and Griffin were strongly rumoured to have had homosexual encounters. According to John Evans, Chaplain of Trinity and Extra Preacher to the Queen, instructions were left with him to reveal after Powell's death that at least one of the romantic affairs of his life had been homosexual. However, Powell's biographer, Simon Heffner, disputed this and argued that this did not mean Powell was homosexual but rather that he had not yet met any girls.

Meanwhile, Griffin, at the age of 16, was reported to have stayed at the home of National Front organiser, Ian Webster. Webster was openly gay and in a four page leaflet written in 1999 claimed to have had a homosexual relationship with Griffin, then the BNP's publicity director. Griffin has denied any such relationship.

However, there are many more contrasts than comparisons. Powell could have obtained real power had he not so spectacularly blown his chances in 1968 and then left the Conservative Party in 1974. Indeed, he might well have won the leadership of the Conservative Party in 1975, instead of Mrs Thatcher. As mentioned, he was an exceptionally clever man and it is a shame that his peculiar views led his career down a darker path.

Meanwhile, as Question Time demonstrated, Griffin is a fairly poor public speaker, a bore and a bigot of the worst sort. His views are significantly more extreme than Powell's ever were, despite his farcical attempts to make the BNP more respectable. For example, Powell was never a Holocaust denier. Indeed, at the age of 70, he learnt Hebrew, his 12th and final language.

Griffin will never remotely attain Powell's achievements. Powell was a prolific writer and an accomplished poet. He had many talents beyond politics and even appeared in the BBC's 2002 100 Greatest Britons of all Time (voted for by the public).

Griffin - for his part - will, hopefully, one day be consigned to the dustbin of anonymity. The sooner, the better, frankly.

LDJ

My dad, Laurance David Jacobs, died on the 25 May 2009, aged 72. The problem with death is that words are inadequate tools to describe the devastation of bereavement and that little phrase, in itself, is a hackneyed old cliche.

Despite saying that, a possible way of conveying the experience is by means of historical anology. At the moment, I'm reading Richard Rhodes' 1987 Pulitzer Prize winning account of the making of the atomic bomb. As everyone knows, the atomic bomb resulted in the tremendous destruction at Hirsohima and Nagasaki in August 1945. Here is the account in Wikipedia of the Japanese realisation of the bombing of Hiroshima:

Military bases repeatedly tried to call the Army Control Station in Hiroshima. The complete silence from that city puzzled the men at headquarters; they knew that no large enemy raid had occurred and that no sizeable store of explosives was in Hiroshima at that time. A young officer of the Japanese General Staff was instructed to fly immediately to Hiroshima, to land, survey the damage, and return to Tokyo with reliable information for the staff. It was generally felt at headquarters that nothing serious had taken place and that the explosion was just a rumor.
The staff officer went to the airport and took off for the southwest. After flying for about three hours, while still nearly one hundred miles (160 km) from Hiroshima, he and his pilot saw a great cloud of smoke from the bomb. In the bright afternoon, the remains of Hiroshima were burning. Their plane soon reached the city, around which they circled in disbelief. A great scar on the land still burning and covered by a heavy cloud of smoke was all that was left.

I remember my dad telling me, when I was a child, that at the end of the World War 2, the Americans dropped a bomb on a Japanese city that was so powerful it immediately killed 60,000 people. I recall struggling with the magnitude of this fact, I just couldn't believe that humans could be so clever and so immensely destructive at the same time.

How did that Japanese staff officer feel when he first realised that a major city had been wiped out in an instant? It was completely without precedent, entirely different from anything experienced before. But that it what the loss of a parent is to you, something that is so outside the bounds of your life experience, that you struggle for days and months to just try and make sense of what has happened. Most often, you can't.

I'm not yet ready to eulogise properly about my father in writing, either in this blog or anywhere else. However, I would like to just share another initial realisation - my first awareness that my dad had a brain that was superior to just about anyone else I've ever met.

I always knew that my dad was incredibly clever. The house was full of unintelligible books and even as a little kid I was dead proud that my dad had come from a very humble background to win scholarships to Cambridge and Harvard and then become - of all things - a nuclear physicist. But it only really struck home the day I decided to test my dad's vocabulary.

Around 1978, when I was 11 years old, my dad bought a slim book called Test Your Wordpower. The book comprised of a prologue followed by 50 tests. In each test, there were 60 words divided into 6 levels of 10 words. Level 1 contained really easy words like dog, cat, house etc. Then the levels increased in difficulty until you got Level 6 which was made up the words which were punted around in a gameshow like Call My Bluff.

The prologue helpfully told you there was a huge correllation between your vocabulary and your IQ. Basically, the smarter you were, the more words you knew. The majority of the adult population ended up in Level 3. If you found yourself in Level 4, you probably had a very decent job. If you landed in Level 5, you were probably a top professional or heading in that direction. Level 6 meant you were very flipping sharp.

I kept taking the tests and usually scraped into Level 3. (Rather irritatingly, I took the test a few months ago and still scraped into Level 3 which shows how little I've learnt in the last 30 years!) My mum comfortably made Level 4 and then, one day, I decided to see what my dad would score. Incredibly, it turned out, that my dad could define every single word in the book.

I was always trying to catch my dad out by hauling in the family's immense English dictionary and checking his definitions but I never tripped him up, ever. He could always define the word thrown at him and it just staggered me. The prologue didn't tell you what kind of person could score full marks on every test but I had a pretty good idea!

Of course my dad was infinitely more than a walking dictionary, he was an absolutely unique and brilliant individual. However, as I said, this blog is not a eulogy just a few random thoughts and memories.

The Evasive Deal

At the moment, there's a tiresome email doing the rounds inviting you to a barbecue party. You've probably all seen it before. The email attaches a powerpoint presentation. When you click onto it, it supplies details of the party - a vision of paradise complete with a tropical island, beautiful companions and the finest luxuries. At the end of the presentation, you are asked whether you would like to accept the invite. There are two icons, "yes" and "no". Of course, you immediately try to click onto the "yes" icon but - surprise, surprise - it runs away from the cursor! The more your cursor pursues the icon, the faster the icon flees your cursor.

So basically you shake your head. It's just a dumb email, after all - right?

As a god forsaken commercial property solicitor, I am regularly sent details of off market properties which I then forward onto clients and contacts. These deals always promise huge finders fees and massive incentives. For example, last week I was sent information relating to a confidential £140 million development site in Central London promising a 2% finders fee (£2.8 million) if the deal could be successfully placed and completed. According to the details, it wasn't going to be too difficult as the developers were in administration and would take an enormous discount if necessary. The redevelopment value was estimated to be in excess of a billion pounds.

However, as I've found out, there are several problems with these deals and most of these problems reflect the current state of the economy.

1. The deal either doesn't exist or exists in a completely differently form to what is being touted. Frequently, this is because proprietors or their agents leak information into the public domain solely to ascertain what the true market value of their properties are. They usually have no intention of selling the properties and will always insist the properties were put on the market without their authority. However, the reality is quite different.

The best example of this is Northern Rock who at the end of last year knowingly released details of over 1,200 repossessed properties in order to obtain their current market price. The resulting scandal made the headlines of the Mail on Sunday and Northern Rock were extremely quick to maintain that the properties were not for sale and they had no idea the information had been released. The truth was by the time they issued their denial they had received all the information they required about the value and demand for their remortgage portfolio!

2. If the deal does exist, there will be a myriad of ignorant intermediaries and agents to overcome before you can actually get to the proprietor or the genuine controller of the deal. This is because the original information will have been been relayed to numerous agents and solicitors who will ultimately demand their finder's cut should the transaction ever complete. The process inevitably creates hideous chinese whispers so a £1m residential property development in Coventry may become a £12m commercial development in Central London by the time you receive it. If that isn't bad enough, the whole property market is currently swamped by paranoia, distrust, fear and greed. Unless you are dealing directly with original parties, the prevailing commercial atmosphere will drag you down. Supposedly off market and confidential properties have sometimes done the rounds for many months and will be flung around the market like a syphilitic whore.

3. If you can obtain an offer from an interested party, it will nearly always be rejected as being too low. Sellers are still woefully naive, or willfully ignorant, as to the current condition of the market which resembles a hedgehog that has been crushed by a line of several hundred tanks. In contrast, cash rich purchasers (there are no other types for the time being) are rare and highly valued. Unlike oppressed sellers, these purchasers are acutely aware of current market conditions and will have been wooed endlessly. When they make their precious cash offers, they will demand their pound of flesh and sellers will find their ruthless offers exceptionally difficult to stomach.

4. If, miraculously, a deal is agreed, it will inevitably collapse as sellers will become convinced that they have been cheated and purchasers will keep chipping the purchase price as the market continues to sink like a stone.

This is Brown's Britain in 2009 and it shows no signs of improving. It is just as well that our Prime Minister has only one functioning eye. With two eyes, he would behold the true state of the economy and the hideousness of his claim to have abolished boom and bust in 2007.

Peaches beats recession woes

On Saturday evening, I caught sight of the front page of the International Herald Tribune and it struck me again how quickly the world economy is deteriorating. Last month, over 600,000 people lost their jobs in the United States. This equals the carnage suffered by American workers at the height of the Depression in the 1930's. I skimmed through the article which finished with the now obligatory reminder that there was no end in sight to the current problems and they were expected to get much worse.

In fact , it seems that any report that contains a bad set of statistics invariably compounds the unwelcome news with some sort of arbitrary forecast that in a few months or years, the terrible figures are expected to double or treble or whatever negative equation takes your fancy.

I then went out to Golders Green in North London for a meal with my wife. But wherever you go you can't escape the unmistakable signs of the current recession. I quickly noticed that within a few yards of our restaurant, bailiffs had forced the closure of three other restaurants and a bar. Then while we were eating our meal, I couldn't help overhearing a number of people bemoaning the loss of their jobs or businesses. The evidence of deprivation and anxiety appears universal.

Finally, we got home and I checked the BBC News website. The headlines under the Main News (as well as the Entertainment) section was that Bob Geldof's teenage daughter, Peaches, had split up with her husband after six months of marriage. Ranking below this news in importance, were the terrible bush fires in Australia.

I scratched my head and asked the obvious question. Why did the BBC think this bit of worthless gossip was so important? Either they genuinely believed that their world audience gave a rat's buttocks about Geldof's child, or, alternatively, they thought this mindless bit of drivel would somehow distract people from the severity of the global recession.

I have no idea but clearly the BBC moves in mysterious ways.

Good Riddance to 2008

Characteristically, a very difficult year has finished on two low points.

Firstly, at midday, the FTSE closed at 4,434 points, compared with 6,457 points a year earlier. This marked a record fall of 31.3% and reflected what the BBC called the "financial brutality" of the previous 12 months. Everyone has rushed to get their tuppence predictions in for what next year holds. Of course, no one knows but the universal feeling is that things are about to get a whole lot worse.

Seventy years ago, George Orwell wrote "Coming Up for Air" and accurately predicted not just World War II but the entire transformation of the society that succeeded the war. As I've mentioned in previous blogs, predictions do occassionally hit the mark but the vast majority of forecasts should be treated with scepticism, especially from the "experts". Remember, no one holds the proverbial crystal ball.

Secondly, Israel is again at war and so far it largely appears to be a repeat of the conflict against Hezbollah in 2006. Once more, we see Israel suffering continous provocation from a neighbouring terrorist organisation, Israel responding with its military might against an enemy that hides amongst the civilian population, Israel criticised worldwide for its "disproportionate" response and an outbreak of sympathy for Hamas. Meanwhile, yet again, for all its technological know-how and intelligence, Israel fails to quell the rocket attacks and hesitates over whether to send in ground forces. If 2006 plays itself out again, then Israel will fail to stop the rockets, fail to remove Hamas and hand them a public relations victory. I can only hope that Israel has learnt some lessons from two years ago.

Despite all the indications, I truly hope 2009 proves to be a much more favourable year for everyone.