Edward Fennell’s LEGAL DIARY

Diary news plus insights, commentary and appointments from the legal world

March 15 2024

Editorial contact: fennell.edward@yahoo.com

SHORT THOUGHT FOR THE WEEK: EXTREMELY CONFUSED?

Michael Gove – Clearly confusing?
Image courtesy of UK Parliament

Just how extreme are you feeling this morning? In the muddle over Michael Gove’s attempt to define administratively (but not legally, as far as we can understand) what constitutes an extreme organisation, the principal result seems to be the assertion of extreme moderation by all the potentially interested parties.

Meanwhile the implications of an individual member of a ‘moderate’ organisation firing off an extreme comment are not clear. By backing away from legislation Gove might have thought he was taking a pragmatic approach in line with ‘British’ values. However, while a nice dose of fudge tastes comforting for a moment or two the consequential mess it leaves on the hands takes a long time to wash off.

The LegalDiarist

In this edition

LEGAL DIARY OF THE WEEK

WOULD A FLAT EARTH HAVE A HORIZON (in the world of the Post Office)?

OUTPACE and TAYLOR WESSING OFFER LEG UP FOR START UPS

– GET THIS GOOD GIDE GUIDE

ROLE OF VICTIMS’ ADVOCATES APPLAUDED

+ CONTRIBUTED ARTICLES OF THE WEEK

– TRANSPARENCY IN PARTNERSHIP PROGRESSION IS VITAL

says Nikki Edwards

-WHISPERS OF GUILT: HOW LAW FIRMS CAN INVESTIGATE

by Mike LaCorte

– PRENUPTIAL AGREEMENTS –

CONSIDERING THE COST OF CERTAINTY by Catherine Costley

+ LEGAL COMMENT OF THE WEEK

on foreign owenership of UK media, Bitcoin claims and the Domidias and Merbau case

+ LEGAL APPOINTMENTS OF THE WEEK

at DWF and PILLSBURY

LEGAL DIARY OF THE WEEK

WOULD A FLAT EARTH HAVE A HORIZON (in the world of the Post Office)?

Richard Morgan KC of Maitland Chambers sees over the Hoizon

Like a Shakespearean play there are many complex issues – personal and ethical – in the drama that is ‘The Post Office versus the Sub-Postmaster’ but one that jumps out for the legal profession is the conflict between getting a result and seeing justice done.

Researchers Richard Moorhead and Sally Day from the University of Exeter Law School and Karen Nokes, from the Faculty of Laws, UCL, are currently engaged in an ESRC-funded study of the Post Office Scandal. They are now warning of the influence on justice of ‘well-resourced lawyers’ who see their role as ‘to win at all costs’ when the court rules emphasise that the overriding principle should be to promote proportionate justice. The difficulties can be particularly acute when one side is unrepresented, they point out.

One of the cases they are looking at in detail is that of Sub-Postmaster Lee Castleton and the strategy employed by the barrister acting against him, Richard Morgan, now a KC.

As the researchers describe it, “Mr Morgan’s ‘Chancery’ strategy influenced the Post Office’s actions in other legal cases against sub postmasters. It involved strictly focusing on the fact they had signed off accounts as accurate, a paper test based on accounts [which were] signed under considerable pressure from the Post Office, rather than proving the robustness of the Horizon system. It then fell to Mr Castleton, who was denied evidence that might have helped him, to try and prove the computer system did not work. A legal argument shielded the Horizon system from scrutiny.”

Morgan KC (of Maitland Chambers) was described in the Legal 500 in 2022 as ‘A lateral thinker who understands the points that will play well with the court’. The researchers’ study observed that Mr Morgan “might be described as the first flat earther’.They suggest regulators should look closely at the role of Mr Morgan.

OUTPACE OFFERS LEG UP FOR START UPS

Emily Fitch-Deeley, Global Head of Partnerships, Seedrs 

Start-ups, scale-ups and other high growth businesses are likely to be given a lift by a new joint initiative from Taylor Wessing and Seedrs, a leading private investment platform. At the heart of it will be Outpace™ (www.outpace.tech) which is described as a ‘revolutionary digital legal solution for startups’ powered by the law firm.

Under the new arrangement companies which are raising (or have previously raised) capital on the Seedrs platform will now be able to access comprehensive industry-leading legal support from Outpace to help structure funding rounds and manage cap tables at a discounted rate. Outpace™ will provide ‘best-in-class’ legal content, digital delivery, automated document production and expert deal support for the most ambitious early stage businesses, says the firm. As part of this partnership, Taylor Wessing has adopted Seedrs as its preferred crowdfunding platform and will refer its existing and future clients – including those on the Outpace™ platform – to it.

This partnership with Outpace™ will help Seedrs deliver on its mission to build a truly democratised future of finance, ensuring everyone, everywhere has access to high quality investment and ownership opportunities,” commented Emily Fitch-Deeley, Global Head of Partnerships, Seedrs “We are delighted to be able to offer our founders with the opportunity to access the wealth of knowledge and expertise that Outpace™ can provide at a discounted rate.”

Recognising that the UK startup ecosystem can be challenging Seedrs and Taylor Wessing – via Outpace™ – say that they hope to have the opportunity to ‘further expand their respective roles in fostering innovation’.

Well, they seem to be outpacing the rest

GET THIS GOOD GIDE GUIDE

You might have seen the report this week that the English Language is little more than ‘badly spoken French’ (albeit with an admixture of Germanic, Scandinavian and Latin not to mention the various Celtic languages as well as significant amounts of of seasoning from Asia). Notwithstanding that Gide, the leading French law firm, has done a very good job with our clumsy tongue in producing its first booklet in English on artificial intelligence – ‘the purpose of which is to provide readers far and wide with free access to a thorough insight on the major orientations of future European legislation and the legal issues raised by AI.’

So berets off to Gide on this excellent publication. Of course, there is an immense amount of discussion about AI right now – especially in a legal context – but Gide has managed to take a broadly based view and look at the immediate practicalities as well as speculate on the way matters are developing.  As the firm descxribes it, ‘This Booklet is the fruit of cross-disciplinary work carried out in conjunction with all of Gide’s practice groups, under the supervision of its Scientific Council and in close collaboration with the Knowledge Management team’.

Mind you the French – and indeed the EU – are a bit further ahead than the UK when it comes to AI. As the guide explains, “The future European AI Act will be the first AI legislation worldwide; it will regulate both how providers of AI systems and GPAI models should develop their systems to minimize risks and how deployers of such AI systems will have to control them. Practitioners will soon be faced with a new set of regulations and will have a decisive role to play: they will have to contribute to the stable and predictable application and interpretation of the future AI Act. ”

Sounds like the real thing.

– ROLE OF VICTIMS’ ADVOCATES APPLAUDED

Navigating the criminal justice system can be challenging for victims,” says Baroness Newlove

Yesterday’s publication by Baroness Newlove, the Victims’ Commissioner for England and Wales, of her latest report brought into focus both the benefits of victims’ engagement with the justice system via advocates and its drawbacks. As one victim commented about the work of her advocate, “She’s checked in on me via calls and text. She’s supported me through the darkest of times. It’s 5 long years and still awaiting trial date and she’s been my backbone. Without her support, I probably would have dropped the case!”

The importance of advocacy was expressed in the report in a number of areas including:

  • Improved engagement with the criminal justice system: advocates help victims understand their rights and options, and ensure they are kept informed throughout the process.
  • Emotional and practical support: advocates provide a safe space for victims to discuss their experiences and offer practical assistance with tasks, such as completing forms or applying for compensation.
  • Holding agencies accountable: advocates can challenge decisions made by the police, CPS and other agencies, and ensure victims are treated fairly and in a timely manner.
  • Coping and recovering: advocates help victims move on from victimisation by providing ongoing emotional support, signposting to other specialist services, and empowering victims to recover.

We know navigating the criminal justice system can be challenging for victims, especially for those who have experienced high levels of trauma,” said Baroness Newlove. “Some even find the process itself retraumatising, feeling stranded and alone in what can sometimes be perceived as an uncaring and complex system. This is where victim advocates step in. Advocates support victim engagement by providing them with essential practical advice and emotional support at a time when they are attempting to negotiate the justice system and recover from their ordeal.”

The report ‘ Going Above and Beyond: Mapping the Provision and Impact of Victim Advocacy in the Criminal Justice System’ is available on the Victims’ Commissioner’s website.

INTERNATIONAL WOMEN’S DAY

TRANSPARENCY IN PARTNERSHIP PROGRESSION IS VITAL

says Nikki Edwards

Last Friday marked International Women’s Day 2024 and in celebrating it the legal sector had a lot to be proud of. More women are entering the profession now than ever before and law firms are placing a huge emphasis on DE&I policies which support the recruitment and retention of female lawyers.

But looking ahead there is still work to do. Despite making significant progress towards achieving gender parity, women continue to be underrepresented at partnership level. Women in private practice now outnumber men, making up 62% of solicitors but they only make up 35% of partners.

What more is needed to level the playing field and give women equal opportunity and incentive to advance to senior levels? That is where this year’s theme, “inspire inclusion” really resonates.

We must consider how the journey to partnership is initiated: too often, with a tap on the shoulder. This does not inspire inclusion. As we all know unconscious biases exist, so the existing partnership is more likely to select individuals who look and sound the same as them. Given that the partnership demographic is predominantly male, this therefore means that men are more likely to be chosen as partners – and so the cycle continues.

We don’t have a lack of female talent to select from. Don’t forget that 62% of solicitors working in private practice are women. The big jump comes at partner level, when the numbers switch and we have 65% male partners.

Most women who move in-house or leave the profession do so when they are mid-level or senior associates. Often this is because partnership seems unappealing or unobtainable, a view which is further perpetuated by the absence of a clear route to partnership or a tap on the shoulder.

To overcome this issue, transparency is absolutely vital – The achievements, experience, skills and qualities required for partnership should be identified by a diverse group and clearly set out for all to see and understand. This would benefit not only women, but all minority groups and the sector as a whole, by allowing talented individuals to achieve their full potential.

Nikki Edwards is Vice President of the London Solicitors Litigation Association (LSLA) and Partner at Howard Kennedy LLP

WHISPERS OF GUILT: HOW LAW FIRMS CAN INVESTIGATE

by Mike LaCorte

The Serious Fraud Office, according to its new head Nick Ephgrave, could make greater use of covert intelligence to help the agency intercede and catch individuals ‘in the act’. That a former senior police officer should favour such tactics is not surprising: investigations are the life blood of policing, after all.

Amongst some lawyers, however, covert investigations are treated with something approaching scepticism. The image of the fedora-clad PI peering over an upside-down newspaper has long – and unhelpfully – shaped the public consciousness.

Yet, from private client through to employment and white-collar crime practices, investigations, if carefully deployed, can play an instrumental role in securing vital evidence. And it is covert techniques – deploying hidden cameras, close surveillance, collection of discarded data and going under cover – that are often the most valuable.

Take the example of the fund manager who hands in his notice and, despite his non-compete clause, promises his new employers that he can quickly entice across several of his old clients. It’s an all-too-common occurrence for employment lawyers that can be tricky to prove without the smoking gun evidence that covert investigation can provide: secretly snapped images of the departing-employee meeting with former clients for lunch whilst on gardening leave shortly before they jump ship.

Spouses concealing their wealth have been betrayed by receipts thrown in bins; individuals trying to defraud insurance companies by feigning injury have been exposed by close surveillance; and suspected employee theft has been uncovered by undercover investigators. What might otherwise have been little more than whispers of guilt have been proved in full voice thanks to covert investigations.

Of course, investigations need to be carefully constructed for the evidence to be admissible and for the law firms deploying them to avoid a regulatory rebuke. It is permissible to gather personal information left in a bin, provided it isn’t on private property, but it is never acceptable to film someone in their own home or to hack a computer. Indeed, the right to privacy means that incriminating information observed by an investigator on the screen of an individual, tapping away in a busy café, is only useful as intelligence, rather than evidence, whilst in certain parts of the world, most notably the Middle East, filming an individual without their consent is illegal.

As in much of policing, the key consideration governing investigations is proportionality. Before any covert techniques are deployed a privacy impact assessment should be undertaken. If evidence can be gathered through less intrusive means, then alternatives to covert investigations must be deployed. But where the case warrants, the art of the covert can be critical.

Mike LaCorte is CEO of Investigations & Disputes Specialists, Conflict International

PRENUPTIAL AGREEMENTS- CONSIDERING THE COST OF CERTAINTY by Catherine Costley

We are approaching ‘prenup season’, the less romantic, less fun sibling to ‘wedding season’. It arrived a little early this year thanks to the focus on leap year proposals, and has seen the former Lord High Chancellor Sir Robert Buckland call to give prenuptial agreements full legal status. There has also been a run of decisions which have bolstered the status of these nuptial agreements – albeit in this jurisdiction we have stopped short of giving them full, binding, legal status as they have in other jurisdictions.

Certainty and discretion sit on either side of the same coin. Discretion is at the centre of family law in England and Wales. The exercise of judicial discretion in the application of the law ensures fairness can be upheld and the needs of everyone are met. To prioritise discretion in this way reflects the English Court’s somewhat paternalistic attitude but it is also part and parcel of the impenetrable family law system here which means that most divorcing parties feel they need the help of a costly lawyer to guide them through the process.

Other jurisdictions go another way, favouring certainty. With certainty can come simplicity and arguably easier access to justice. But with that certainty we lose the capacity to help those who occupy the grey areas, where the situation is not so black and white.

We cannot end the inherent uncertainty in the English divorce law, without losing the protection of discretion which it holds. So, to give full legal status to nuptial agreements will require a sea change in the cultural understanding of marriage and divorce. If we knew there was no safety net upon divorce, and we would be held to the terms of a nuptial agreement, would we behave differently during a marriage? Women might not be so quick to soft pedal or give up their careers to prioritise the needs of their family; parties might mingle their wealth in a more deliberate and conscious way so as to pave the way for an easier untangling of their contributions on a divorce; would a marriage really be a true partnership any longer?

This change in what happens at the end of a marriage, would require time to trickle along and influence how we live during a marriage. The increased use of nuptial agreements by individuals is flowing through into an increase in the case law upon divorce, which in its own way brings greater clarity about how the law will be applied in a given situation. Perhaps this is how we move in the same direction as our neighbours in Europe? In my experience, the cost of certainty will impact the most vulnerable, so even though we might move to increase clarity and reduce discretion, the capacity for the Court to protect must not be lost entirely.

Catherine Costley is a family law partner at Fladgate

TOPIC: The announcement by Lord Stephen Parkinson in the House of Lords that the government would put forward an amendment preventing foreign state ownership of a newspaper.

COMMENT BY: John Schmidt, Competition Partner, Arnold & Porter

“The proposed legislation is specifically designed to deal with situations like the The Daily Telegraph acquisition. It is more specific than the general media regime and which means that it is likely to allow for a decision on more political reasons than under the current regime. Given the objections, it seems to me that the current regime could have been used to prohibit, but we don’t know yet what the Ofcom report says.    The biggest drawback of the current regime is that the deal would require a lengthy second phase review also covering the public interest ground before the Secretary of State could decide which wouldn’t be necessary under the proposed regime.”

TOPIC: This week’s ruling in COPA v Craig Wright which determined that Craig Wright is not Satoshi Nakamoto, the alleged creator of Bicoin

 COMMENT BY: James Evison, Managing Associate, Stevens & Bolton

The judge’s closing comments in the COPA v Wright trial are revealing. Judges will often reserve judgment until after the trial to carefully weigh the evidence and craft their decision. That Mr Justice Mellor felt able to express such a clear view in closing submissions – that Dr Wright is emphatically not Satoshi Nakamoto – speaks to the weight of evidence against Dr Wright. The trial has seen much public comment from both sides but it was allegations of forgery that stood out – including expert findings that the Bitcoin white paper was written using a different code to the one claimed by Dr Wright and that metadata in key documents had been altered.

This was always going to be high stakes litigation. The various Bitcoin cases Dr Wright is involved in could, on the one hand, see him walk away a billionaire exercising control over the future direction of Bitcoin development. On the other hand, if the court finds he tried to rely on forged documents, then Dr Wright’s prospects look significantly less rosy. We will need to wait for the full judgment and see whether an appeal is allowed but, for the Bitcoin community, if there is such a thing, this is likely to be a day of celebration. Separate cases brought by Dr Wright against Coinbase, Kraken and BTC Core will all be directly affected by this judgment and may now fall away. A further case brought by Dr Wright’s company Tulip Trading Ltd rests on a different set of issues but will be watched closely in light of the judge’s comments today.”

TOPIC: The summary judgment in the Commercial Court by Dame Clare Moulder DBE in Domidias Limited & Or v Sian Participation Corp. (In Liquidation) & Or[2024] EWHC 458 (Comm) in favour of Domidias Limited and Merbau Synergy Limited. (This is the latest instalment in the litigation being pursued by Mr Ziyavudin Magomedov (a Russian oligarch who was jailed in 2022 for 19 years on fraud and embezzlement charges).

COMMENT FROM: Lydia Danon (Partner) and Jordan Waldock (Senior Associate) at Cooke, Young and Keidan (who acted for Domidias and Merbau).

This is a welcome reminder of the importance of fundamental contractual principles. First, for there to be a valid and binding agreement there must not only be acceptance of an offer, but that acceptance must be communicated. In this case, notwithstanding evidence suggesting an agreement had been signed, there was held to be no realistic prospect of showing that there had been any communication of acceptance, on the basis of the contemporaneous evidence. Accordingly, it was held that there was no concluded agreement.

Second, with respect to contractual interpretation, Dame Moulder reiterated that the correct (and binding) approach to the construction of contracts is that set out in Wood v Capita Insurance Services Ltd [2017] AC 1173. In view of that approach, Dame Moulder preferred the interpretation which was consistent with “business common sense” and was supported by the context taking the agreement as a whole, in line with the ordinary and natural meaning of the text.

Aside from this, the decision will also have broader ramifications for Mr Magomedov’s US$14 billion conspiracy claim in the Commercial Court, following his failed attempt to seek a US$8.8billion freezing injunction in October 2023.”

DWF

David Wynn (left) has joined DWF, the provider of integrated legal and business services, as a Partner to expand the firm’s global insurance practice. He will take the role of Head of Casualty in DWF’s Manchester office, as well as Global Head of Legacy across the firm’s Insurance Services division.

Formerly with Clyde & Co, where he had headed the Global Legacy Solutions practice for the past decades, Wynn has advised a range of global insurers, reinsurers, run off specialists and multinational companies on their industrial disease and casualty claims. His practice focuses on the early and commercial resolution of both Short and Long Tail Occupational Disease Claims. He is particularly known for a pragmatic approach and efficient resolution of Mesothelioma claims. He has a particular interest in legacy issues for the Chemical, Mining and Construction industries and has a keen focus on emerging risks for insurers and industry.

“I am delighted to welcome David to DWF,” said Glyn Jones, Head of Insurance Legal Services at DWF. “David has a fantastic reputation in the casualty and disease market, particularly the legacy casualty market. He will significantly strengthen our capabilities in this rapidly growing service line [and] will play a key role in further developing our integrated legal and business services offering to this sector on a global basis.”

PILLSBURY

Audrey Koh (left) is joining Pillsbury as part of the firm’s expansion of its Corporate Investigations and White Collar Defense practice in London.

Formerly at Avonhurst but with extensive experience in a number of well-known law firms including Skadden, Womble Bond Dickinson and also having been Head of Legal & Compliance, Chief Compliance Officer and Money Laundering Reporting Officer for an oil and gas-focused private equity firm (plus a secondment to the UK’s Serious Fraud Office) Koh has enjoyed a powerful track record to date. She is also the 2024 winner of Lexology’s Client Choice Award for UK Business Crime Defence and is fluent in Mandarin and proficient in Cantonese.

“With a very substantial amount of Pillsbury’s work crossing international boundaries, our London office has always played an essential role in addressing clients’ multijurisdictional needs in the United Kingdom and across Asia, Europe, the Middle East and Africa,” said London office managing partner Matthew Oresman. “Audrey’s background and experience overseeing corporate investigations at the highest levels will be invaluable to those we represent, enhancing our London-based litigation offering and adding new dimensions to our white collar disputes practice worldwide.”