Edward Fennell’s LEGAL DIARY

March 31, 2023

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

March 31 2023

Editorial contact: fennell.edward@yahoo.com

SHORT THOUGHT FOR THE WEEK: ‘I WISH YOU WELL’

Keeping to the straight and narrow? Image courtesy of Viking Ski Shop

You don’t have to be a fan of Gloop to respect Gwyneth Paltrow’s restraint – and indeed generosity – in saying ‘I wish you well’ to Terry Sanderson after the past few days in court disputing who was responsible for a skiing accident dating back several years.

As our article below by Jonathan Wheeler describes, litigating skiing mishaps is a pretty dicey undertaking. The same might be said for arguments over hedges between neighbours and countless other personal and domestic ‘grey areas’ of rights and responsibilities. Knowing when to adopt the wisdom of the stoic and the patience of the saint might be one of the key skills for a tranquil life. Litigious rage may sometimes be justified but it can also be the fuel for calamity. Keep cool on life’s upward slopes.

The LegalDiarist

In this week’s edition

+ LEGAL DIARY OF THE WEEK

– Lunch at Law Society for Nicholas Vineall KC Hosted by Zaiwalla & Co

– Cartels in Decline according to Morgan Lewis

– New Phone-from-Home at Kennedys

– Hogan Lovells co-ordinates action at the UN’s Committee Against Torture

+ CONTRIBUTED ARTICLES OF THE WEEK

– Litigation is a slippery slope for skiers, says Jonathan Wheeler

– What are the implications for Indian lawyers of opening the doors to competition? ask Naveen Tuli and Ashish Raivadera

– The Ongoing Impact of Sanctions against Russia on the Aviation Industry by Daniel Powell

LEGAL COMMENT OF THE WEEK on the fining of William Hill, the anniversary of the Bucha masacre, proposals for reform of surrogacy and the Government’s White Paper on AI.

APPOINTMENT OF THE WEEK at Serle Court

E-VENTS at Hogan Lovells

LEGAL DIARY OF THE WEEK

Lunch at Law Society for Nicholas Vineall KC Hosted by Zaiwalla & Co

Nicholas Vineall KC (above) speaking to guests of Zaiwalla & Co including the Rt Hon Sir Tony Baldry, Dr Ravi Mehrotra (Executive Chairman, Foresight Group), Professor Ajit Lalvani, Her Excellency Ms Karen-Mae Hill (High Commissioner of Antigua & Barbuda), Sir Richard Aikens (rtd Court of Appeal Judge), Shreeranjani Kavagavel (The Indian High Commission), Raghav Singhal (Deputy Managing Director, ICICI Bank UK), Sharukh Wadia (Senior Vice President, IndusInd Bank), Sir Nadhmi Auchi, and Mayur Patel (CEO of Sangam, Hinduja Group).

Nicholas Vineall KC the new Chairman of the Bar Council, was the guest of honour on Wednesday this week at a lunch at the Law Society hosted by Sarosh Zaiwalla, Senior Partner at Zaiwalla & Co, to celebrate Mr Vineall’s new status and to reflect on key issues facing the Bar and the wider legal profession.

Mssrs. Zaiwalla and Vineall are old colleagues having worked together on the high profile Bank Mellat case, where Zaiwalla & Co successfully obtained a multi-million-dollar settlement with the UK Government to resolve Bank Mellat’s claim before the English Court. (It is speculated that this might have had long term implications, indirectly, for the release by Iran of Nazanin Zaghari-Ratcliffe).

“We would like to congratulate Nicholas Vineall KC on his new role and we are delighted to have honoured him at [this lunch today],” said Sarosh Zaiwalla. “Nicholas Vineall KC’s new role is crucial in upholding the law, as well as ensuring the fair and effective operation of the courts across England and Wales.”

In his response Mr Vineall spoke of the crucial role played by an independent bar in maintaining the rule of law. “The independence and objectivity of barristers in representing clients, despite the barrister’s own personal views about a case, is one of the great attributes of the English legal profession which, together with the universality of English common law, continues to make London a highly attractive centre for global dispute resolution,” he said. He also expressed appreciation for the recent launch of Zaiwalla’s “Solicitors of Tomorrow” internship scheme that is open to law students and graduates from under-represented groups who are interested in pursuing a career in the legal profession.

Cartels in Decline according to Morgan Lewis report

Well worth a read is Morgan Lewis’s newly published Global Cartel Enforcement Report. This found that fines in the United States -traditionally the top nation when it comes to cartel enforcement – were lower than any time in the last 20 years. But this was just part of a wider trend. Overall global fines decreased by 70% over last year. This may be the result of increasingly active anti-cartel activity by a number of governments who have become more effective in developing new investigative programs, building new cases, and pursuing new enforcement actions. There was, for example, a substantial growth in use of dawn raids, particularly those involving domestic premises given the rise in remote work as a result of the COVID-19 pandemic. And it wasn’t just in the USA that improvements were seen. The European Commission also reported a substantial increase in leniency applications and increased enforcement activity resulting from its whistleblower programme.

Interestingly one of the new growth areas of cartels lies in “no poach” cases which involve agreements between employers about hiring and compensation. In effect this is a conspiracy by employers against their workers to stop movement between companies and has resulted in major precedent-setting cases brought in the United States.

New Phone-from-Home at Kennedys

Nick Thomas, senior partner, and Suzanne Liversidge, global managing partner – happy in Kennedys new home

In another clear sign that ‘the office is back’ (albeit in a new formulation) Kennedys announced that it has completed its move into the “Walkie-Talkie” building in Fenchurch Street which is distinguished – along with its eponymous nickname shape – by its “Sky Garden”, the capital’s highest public garden,

Pre-Covid the LegalDiarist visited the building from time to time and always enjoyed its scale and deliberate eccentricity. But was it ‘the future’ or just a one-off?

Well, it’s firms such as Kennedys which are now working out what the means in practice. “While our hybrid working policy has been a huge success, it was clear to us from consultations with colleagues that there was still very much a need and a wish to be close to our clients in the city, “ said Nick Thomas, the firm’s senior partner. “I think we now have the best of both worlds, allowing colleagues increased flexibility while at the same time being able to meet, collaborate and entertain clients in an office which is fit for the future in one of the most impressive buildings in London.”

Decamping to the Walkie-Talkie is just one a series of major office moves undertaken by Kennedys as part of its ‘WorkWise’ programme which has impacted more than half-a-dozen offices in Europe and the US. “I want to congratulate colleagues across the business, from facilities to finance, who have pulled together to deliver our biggest move yet,” said Suzanne Liversidge, global managing partner. “At 638, the London team is the largest it’s ever been and to relocate operations so seamlessly has been an amazing team effort. It’s a stunning building and an uplifting environment and I have no doubt it will feel like home in no time.”

Hogan Lovells co-ordinates action at the UN’s Committee Against Torture

The struggle to get justice for a group of Yazidi women who were kidnapped, enslaved and abused by members of Da-esh took a fresh turn this month when an international team of human rights lawyers instructed by Hogan Lovells filed a joint communication to the UN’s Committee Against Torture highlighting the failings in the global system for reparations for victims of torture and sexual violence in conflict.

The particular target on this occasion was Australia since the man responsible for enslaving and torturing the women was an Australian citizen, Khaled Sharrouf, a high-profile member of IS. Although the complainants sought to obtain redress through the Australian legal system their applications for compensation were rejected on the grounds that that the compensation scheme related only to acts of violence committed in Australia.

Professor Philippe Sands KC (pictured above), who is leading the team of international human rights lawyers working on the case, said, “The purpose of taking the complaint to the UN Committee is to end the impunity of governments who have pledged to support Yazidis in their quest for justice.”

“You’ve got a situation of utter lawlessness in which governments who have committed to rooting it out seem unwilling to take responsibility to provide the institutional and financial mechanisms to deliver on that commitment. If there’s a gap, and unless that gap is filled, you have impunity and more lawlessness.”

“The legal framework as it stands seems incapable of delivering, so this application is intended to fill that gap and seek to recognise the responsibility of a state like Australia to ensure that justice is done for the victims.”

The Hogan Lovells team advising on the case includes International Pro Bono Partner Yasmin Waljee OBE, counsel Helen Boniface, associates Alex Riposi and Haylea Campbell, trainee solicitor Shah Warraich in the UK, and partner Scott Harris and associate Adam Aarons in Australia.

CONTRIBUTED ARTICLES OF THE WEEK

Litigation is a slippery slope for skiers, says Jonathan Wheeler

This week saw Gwyneth Paltrow take the stand for the first time in a civil trial over a ski accident in 2016. The story has been all over the headlines: Paltrow is accused of crashing into Dr Terry Sanderson, who claims the collision left him with a brain injury.

The heavily publicised trial has been ‘memeified’ by social media users poking fun at various out-of-touch moments from Paltrow – such as offering treats to courtroom security and remarking when asked how she’d suffered as a result of the collision ‘well, we lost a day of skiing’.

As it stands, it’s tricky to know which (if either) party is in the right, as lots of the detail is missing – although the court yesterday found in favour of Paltrow. However what we do know is that making a claim for a skiing injury and proving it was entirely the fault of someone else can be pretty difficult. The sport is inherently risky, and accidents between skiers are not uncommon, so often the courts will view them as simply that – an accident which holds no blame.

The exception to this is when the claimant is able to prove their injury was caused by the other party skiing negligently. But in the UK, even if the claimant can prove this, there’s no guarantee they’ll receive the full amount of compensation they’re entitled to – which, when a traumatic brain injury has occurred, can be worth millions. Some of this will be covered by the defendant’s holiday insurance (assuming they were responsible enough to take it out) – but the insurance has a limit and can only cover so much.

So, claimants then need to sue the person who caused their injury, who will be expected to shoulder the rest of cost. This can be an issue, as the defendant often won’t have the money to afford the settlement – unless, that is, the defendant is Gwyneth Paltrow.

Jonathan Wheeler is Managing Partner at Bolt Burdon Kemp

What are the implications for Indian lawyers of opening the doors to competition? ask Naveen Tuli and Ashish Raivadera

After decades of lobbying, the Indian market has opened its doors to foreign firms and lawyers, in what is being described as a ‘historic’ decision. A surprise to many Managing Partners of the biggest Indian firms themselves, the fine print was being read while the ink was still drying.

What we can be sure of is that this decision has changed the game for Indian lawyers and will result in improved competition. India has been one of the last major global economies to resist foreign law firms and preserve legal practice for its own residents, but its larger firms will now have to step up their game significantly if they are to retain their best talent.

Nevertheless, many will see this as an exciting opportunity. For India, the new policy will really impact their regional legal market, as these smaller firms will be opened up to working on a global scale. However, this presents as much a challenge as an opportunity, and individual practitioners will need to upskill and broaden their remit to ensure that these firms stay on the map amid greater global competition.

Some General Counsels of European and US multinationals have historically struggled with their external counsel in India, and so having a familiar US or UK law firm on the ground may streamline processes from their perspective. In this way, the slight relinquishing of control from India over its market will ultimately be to its benefit, as it will encourage the flow of US and UK investment.

While the details are still being absorbed by the wide range of professionals it will impact, it remains to be seen who will make the first move and what the real implications are. All eyes are on India to see whether this will be a similar movement to the Singapore market liberalisation, where the dust finally settled on a happy medium, with international firms working in tandem with the best Indian firms. Officials have made clear that the decision has been made on a reciprocal basis and so this could well be the case.

Of course, the full impact of the decision won’t be felt until much further down the line, but Indian firms and companies must be encouraged that the opening up of the market will not lead to a UK/US takeover but will instead make the Indian market a more competitive one, thus positively impacting the wider economy. In an age of globalisation, equal support of collaboration and competition is key. With this new model, India will be opened up to a new global network and a world of opportunity.

Naveen Tuli is In-House Counsel Managing Partner, EMEA & APAC, and Ashish Raivadera is Managing Director, Private Practice, South Asia, at Major, Lindsey & Africa

The Ongoing Impact of Sanctions against Russia on the Aviation Industry by Daniel Powell

The sanctions imposed on Russia have caused significant disruption to the aviation industry. Prior to the Ukraine conflict, Russia was a fertile market to enter into lease agreements and partnerships. Sanctions have now brought these aviation dealings with entities connected to Russia largely to a halt.

UK companies are prohibited from entering into transactions with Russia to supply aviation equipment and partnerships with Russian airlines have been banned. Monies and aviation equipment allocated for a transaction between UK and Russian businesses prior to the war therefore now must be directed elsewhere.

It is particularly problematic for UK companies holding existing lease agreements with those Russian entities impacted by sanctions. UK companies are prevented from supplying aircraft and parties cannot perform their contractual obligations to comply with the terms of an existing lease. This has led to significant tension and difficulties for companies to depart from an existing commercial agreement. For those lease agreements with arbitration clauses, this is complicated further by a Russian Supreme Court decision last year deciding that the Russian Arbitrazh courts would have exclusive jurisdiction over commercial disputes impacted by sanctions, regardless of a contractual provision of a different forum.

To muddy the waters further, a Russian law implemented and signed by President Putin in March last year, which permits Russian airlines to register foreign owed aircraft as Russian owned, still stands. This development has substantially added to the difficulty of leasing companies retrieving foreign aircraft from Russian parties and foreign aircraft therefore continue to be operated by Russian airlines without the consent of the manufacturer or lessor of the aircraft.

What is more problematic, particularly for aircraft manufacturers, is that Russian connected operators rely on foreign countries for aircraft resources and maintenance services. Now that sanctions limit the supply of these services, this raises safety concerns for aircraft which are under equipped or insufficiently serviced. An incident involving one of these foreign aircraft, even if beyond the control of the aircraft manufacturer, may still have a devastating impact on the aircraft manufacturer and its reputation.

An additional grievance is that insurance arrangements for both aircraft manufacturers and leasing companies are further complicated by the prohibitions imposed by sanctions. In an ongoing UK High Court dispute, insurers are disputing that Russian seizure of aircraft is a loss under the insurance policy.

Due to the wide breadth of sanctions, aircraft lessors unfortunately have limited actions available to them to remedy or mitigate the losses arising from the disruption to lease agreements with parties connected to Russia. It remains to be seen in this tense global political climate if other nations will be drawn into the conflict, which would complicate the situation and multiply the issues facing the industry.

Industry participants will seek to draw lessons from this recent experience. In lease agreements with other non-UK companies, that are not currently impacted by sanctions, a clause could be inserted accelerating the period for leased aircraft to be returned upon termination of the lease, in the event of military conflict. In addition, considering the ongoing UK High Court dispute, insurance policies should be reviewed to capture a range of possible risks associated with sanctions measures and government imposed counter measures.

Including at least some further certainty in lease agreements and insurance contracts may help to avoid more confusion in the future should the existing conflict escalate further.

Daniel Powell is a Chartered Legal Executive (FCILEX )at Zaiwalla & Co.

LEGAL COMMENT OF THE WEEK

TOPIC: The Gambling Commission’s fine of William Hill

COMMENT BY: Sean Curran, Partner, Arnold & Porter

“What is interesting about the Gambling Commission’s enforcement in this instance is not only the size of the fine it has imposed, but that failings were so egregious it considered suspending the operator’s licence.

“Additionally, the GC has mandated ongoing monitoring by way of an improvement plan and an external audit of compliance policies, in line with the second largest fine levied against an operator for similar failings.

“It is clear that the GC has stepped up its investigatory and enforcement efforts in recent months both in terms of ensuring operators play their part in making gambling safer, and in sanitising the industry from illicit funds.

“This fine is a stark reminder of the crucial need for gambling operators to maintain robust, responsive and effective policies and controls or risk falling foul of the GC’s rules and regulations.”

TOPIC: The anniversary of the ‘Bucha massacre’ where the bodies of more than 450 innocent men women and children were discovered by the Ukrainian authorities

COMMENT BY: Wayne Jordash KC, Managing Partner of Global Rights Compliance, an international law firm and foundation which is supporting the investigation of war crimes by Ukraine’s Office of the Prosecutor General (OPG)

“The Russian plan for Bucha is now as clear as day: they wanted to eliminate any semblance of Ukrainian resistance and identity in the town, and they were willing to stop at nothing – terrorism, torture and indiscriminate murder of civilians included – to achieve this goal.”

“One year has passed since the startling footage from liberated Bucha plunged the civilised world into shock. Bucha is now free and able to look back at those dark days. The OPG’s investigations continue at pace. Every day we know more and every day we move closer to justice for victims and their families. Russia’s military units in Bucha and many of the perpetrators have been identified. The body of evidence collected, and the attention paid to these investigations, both domestically and internationally, raises the possibility that the entirety of war crimes, crimes against humanity and genocide may be identified and accountability and recompense for these terrible crimes, may be obtained.”

TOPIC: the Law Commission of England and Wales’ and the Scottish Law Commission’s Final Report and Draft Bill to reform the laws around surrogacy,

COMMENT BY: Zaina Mahmoud,the University of Exeter, whose research informed some of the proposals

“This goes some way to relieve some of the issues currently presented by the British legal framework.

“Reforms resulting in the slightest move towards commercialisation of surrogacy organisations were not supported by the surrogates I spoke to. They saw this as being out of step with their altruism, thereby invalidating their motivation. Instead, some oversight through light-touch regulatory approach, fostering self-regulation, was welcome. It is great to see recognition in the report of the important role played by surrogacy organisations, and to have these organisations regulated.

“The current approach to payments places surrogates in legally vulnerable positions and heightens their anxieties that intended parents view them as motivated financially or untrustworthy. In my research, surrogates were in favour of payment for the essential costs of pregnancy, any additional costs of pregnancy, loss of welfare entitlement, and loss of earnings. They were divided over whether they should necessarily receive gifts – some saw this as undermining their altruistic motivation and having the potential for this to become a backdoor for payments.

“While the proposed reforms go some away at alleviating these anxieties, the proposals fail to account for the subjective and relational nature of the relationships formed during these arrangements. I would have liked to see more recognition of how onerous gestational labour can be, and how it should be compensated. Ideally, reforms should provide security and certainty, minimise any potential negative impact on the relationship and ensure surrogates’ altruism does not result in their own financial detriment.

“It was great to see that the Law Commission’s proposed new pathway allows for the intended parents to be recognised from birth, provided certain requirements are met. However, this does not go far enough at dismantling the legal approach of gestation resulting in motherhood.”

COMMENT BY: Sarah Williams, Modern Family Partner, Payne Hicks Beach

“The proposed reforms are welcome as the current law often means that couples are driven to seek international surrogacy. In some countries, this places women and children at a high risk of exploitation.

“By offering an approved and regulated body that will support the parties
in entering a surrogacy agreement there will be more security and protection for the parties.

“The proposed new rules will also offer greater clarity on the thorny issue of payments to surrogates.

“Whilst commercial surrogacy will remain illegal, the rules will clearly set out
what payments intended parents are permitted to make to the surrogate. These will include travel costs, pregnancy support, medical costs, wellbeing costs, and lost earnings. Surrogacy will remain an altruistic process.

“It now remains to be seen whether the Government will implement the recommendations of the Commission.”

TOPIC: The Government’s AI White Paper

COMMENT BY: Ashley Williams, Partner at Mishcon de Reya and technology lawyer,

“The UK’s AI White Paper can most be neatly summarised by the following statement: no new legislation, no new regulator.

“The proposal is to implement a framework underpinned by five principles – very similar to existing OECD principles – to guide and inform the responsible development and use of AI in all sectors of the economy.

“It identifies that major emerging technologies such as autonomous vehicles and Large Language Models (ChatGPT) are unlikely to be directly ‘caught’ within the remit of any single regulator and there is further work to be done to identify these gaps and address them.

“It also articulates the headache of allocating responsibility across existing supply chain actors within the AI life cycle and therefore proposes not to intervene at this stage. Contracts will need to continue to do the heavy lifting of allocating responsibility.

“For many, this will stand in stark contrast to the EU’s rule-based approach. The proposed UK approach has some upsides, such as flexibility balanced with a pragmatic approach, but several downsides, most notably the continuing lack of certainty.

“For the UK approach to really work, it is important to acknowledge that some regulators will be under-resourced and lack AI experience to really deliver. Others may be too heavy-handed in their approach without a clear steer on how they should implement the framework.

“Supporting regulators will be critical in making this approach workable and ensuring specific sector guidance is issued in a timely manner with real cooperation across the regulators. Regulators will be supported by a centralised function which will require substantive investment in terms of resource and expertise.”

APPOINTMENT OF THE WEEK

SERLE COURT

Dan McCourt Fritz (pictured) has taken silk as Serle Court’s youngest KC. At only 15 years’ call, Fritz is one of the first of the 2007 cohort from across the bar – and notably within the commercial/chancery sphere – to achieve this distinction.

Fritz’s practice centres on three inter-related specialisms – company law, civil fraud and trust disputes, often with an international element – and he is recognised by the main directories as a leading practitioner in civil fraud, offshore work, chancery commercial, commercial disputes and company and partnership law.

Having studied neuroscience at Gonville and Caius, Cambridge, Fritz realised he preferred arguments over the research and combined with his passion for acting the Bar became an obvious career choice.

“It is a great privilege to take silk,” commented Fritz. “I have taken great satisfaction from both my claimant and defendant work over the years, and I am incredibly proud to be recognised for this work with one of the highest honours available to an English lawyer. Whilst the grandeur of the event was certainly surreal, surrounded by friends and colleagues, I was most happy to share this occasion with my family. I am also grateful to my colleagues and good friends Hugh Norbury KC and Justin Higgo KC (among other silks in and outside chambers), two exceptional barristers who have been key mentors in my career, and to whom I owe a great deal.

For more information, click here.

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