Edward Fennell’s Legal Diary – Edition 91

Friday 4 February 2022 

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

SHORT THOUGHT – TIME TO BRING THE CURTAIN DOWN?

The Whitehall Farce has a cherished place in London’s theatrical history. The drama usually played out hilariously in the build up to the grand finale when the hapless buffoon at the centre of the story is caught, definitively, with his trousers down having spent the previous three acts trying to avoid this fate.

Our new decade has evolved a variant on that theme – the Downing Street farce – in which the buffoon is caught with his trousers down time and time again but the tragi-comic final scene only arrives once he finally faces up to it.

The rule of law is the much abused backcloth to all these shenanigans. And what is currently happening in Northern Ireland – with its chaos over the status of the Protocol – provides a commentary on the state of a government which does not take the law seriously. Brexit is far from being ‘done’. Sadly it’s just the law which has been made to look foolish.

The LegalDiarist

In this week’s edition

LEGAL DIARY OF THE WEEK

– Domestic Violence Victims to Benefit from New Project

– Horwich Farrelly Backs Dementia Sufferers

– From AI to B-Innovative at Burges Salmon

– Party and Divorce Like it was 1993?

LEGAL COMMENT OF THE WEEK

Clinical negligence costs, paid leave, equal pay, NHS vaccinations, cost of registering as a UK citizen.

CONTRIBUTED ARTICLES OF THE WEEK

Developments in Litigation Funding: What happens next? by Kate Gee

The legal services sector needs to work towards being more inclusive and embrace the different areas of the industry by Amanda Hamilton

Lessons from the De La Rue pensions case by Anna Rogers

APPOINTMENTS OF THE WEEK by Clifford Chance, Axiom DWFM and McAlister Family Law

E-VENTS

LEGAL DIARY OF THE WEEK

Domestic Violence Victims to Benefit from New Project

Viewers of BBC1’s cop-series RESPONDER this week will have seen a graphic vignette of what domestic violence means in reality – and it struck home powerfully not least because the victim was a policewoman.

She was in the fortunate position to be able to denounce her abuser. However, as Bushra Ali, Founder and Director of Bushra Ali Solicitors, points out, those women who enter the UK as spouses or partners of British nationals and who are then subjected to domestic abuse are not so lucky.

“These individuals face a number of immigration issues once their marriage or relationship breaks down.  They can no longer remain in the UK on their current visas and are faced with either having to return `back home to their country’ to bring immense shame upon their families, remain in the abusive household or take the plunge to make an application seeking an indefinite right to stay in the UK as victims of domestic abuse.”

To support women in this predicament Bushra Ali Solicitors has launched a new project called `Be the Change – Empowering You’. “Although this area of work is still publicly funded not enough solicitors offer this service under public funding as it is so poorly paid.   There are also `desert islands’ around England and Wales where legal advice, let alone publically funded advice, is simply not accessible.”  

Many of those expected to benefit will be individuals who are housed in refuges, are not employed and have no personal savings. 

“My vision for this project is that it will become known far and wide across the whole of England and Wales, empowering individuals who are trapped in abusive relationships to have confidence that they will be supported in resolving their immigration status,” says Bushra Ali.

Speaking about the project Meena Kumari, Trainer and Founder of H.O.P.E. Training & Consultancy said, “The ‘Be the Change – Empowering You’ project is so needed for the women in the communities we serve.  Often these women are destitute and their immigration status is used as a form of control.  I hope this project is seen as great initiative and helps a great number of women.”

Bushra Ali Solicitors has offices in Leicester and Wrexham. Bushra Ali was the first Chair of Equality and Diversity sub-group at Cheshire and North Wales Law Society.

Horwich Farrelly Backs Dementia Sufferers

The Alzheimer’s Society will benefit this year thanks to a new partnership with Horwich Farrelly, the insurance and business specialist, following a vote by the law firm’s staff. The firm recently secured two titles at the British Legal Technology Awards and one of the key activities in which the lawyers will engage is the Society’s early evening ‘Glow Walks’. This will involve volunteers from the firm ‘shining a light’ on dementia with a night-time stroll around a dozen towns and cities across the UK.

Alongside the Glow Walks, staff will also take part in more long-distance walks and runs with Horwich Farrelly covering costs.“The statistic that one in three of us will develop dementia in our lifetime really hits home and highlights why it is so important to raise awareness and help support the cause,“ comments CEO and Managing Partner, Ronan McCann. “The Alzheimer’s Society isa charity close to a lot of our colleagues’ hearts and I look forward to taking part in some of the events myself.”

Nicki Nalton, Community Fundraiser at Alzheimer’s Society, adds that the past year has been catastrophic for people with the disease. “Dementia is devastating at any time, but people with dementia have been hardest hit by Covid-19. Overnight they were ripped from their support networks, crucial services were suspended, and many spent more than a year without being able to see or hug the ones they love. As there is currently no cure for dementia, this is valuable time they couldn’t afford to lose. Together we can make an impact on the lives of people living with and affected by dementia.”

From AI to B-Innovative at Burges Salmon

How can law firms keep up with lawtech and anticipate where the next developments should be? That is one of the biggest challenges facing law firm chiefs and is the driver behind much of the current interest in law firms going for an IPO.

So being creative is now critical and Burges Salmon is tapping into its biggest asset – the creative thinking of its own staff – to carry it forward.

Last week was the firm’s fourth annual B-Innovative Week, focused on harnessing latest technologies and approaches to innovative client service delivery. Under topics such as ‘Get Creative with Teams’, ‘Paperless Working’ and ‘Understanding Client Service Delivery Legal Technology’ together with issues such as ‘The future of AI’ and ‘Innovation and Technology Trends in the Legal Market’ the Burges Salmon team was updated on smart ideas and better ways to function. People also had the opportunity to enjoy a virtual whistle-stop tour of the firm’s innovative technology platform, BScale, hosted by David Varney, a Director in the firm’s Technology and Communications team. “B-Innovative shines a spotlight on innovation and technology and is intended both to inspire our people and, importantly, to give everyone actions they can take forward in their day to day work,” said Emma Sorrell, the firm’s Innovation Manager, “The high engagement across the firm with B-Innovative Week shows there is real interest from our people in being curious, enhancing their digital skills and exploring their creativity, and ultimately improving client service delivery.”

Party – and Divorce – Like it was 1993?

As the world starts to gird its loins again and ‘return to normal life’ , family lawyers are preparing for an avalanche of work. Divorce rates in the UK are predicted to spiral up by more than 50% in 2022, according to James Brien of easyonlinedivorce.co.uk. Already the figures are pretty impressive (or depressive depending on your point of view). In the fortnight following what is called cheerfully the UK’s Divorce Day, the first Monday in January, enquiries to law firms about starting actions increased by over 67% compared to the same two weeks last year.

And that is just the start. “New Divorce Law comes into effect on 6th April, which could see divorce rates soar, as no-fault divorce legislation will replace the current fault base system,” says Brien. ‘‘Under the current system a divorce application must be supported by one of five facts. These are adultery, unreasonable behaviour, desertion, two years’ separation and five years’ separation. Couple’s divorcing under the new law will no longer need to rely on one of the 5 facts.”

On average there are around 100,000 divorces in England and Wales – 2022 could see an additional 26,000 divorces because couples won’t need to wait for two years. Plus there are a number of post-covid factors which might also boost demand to get out of relationships which have soured or gone stale. Mind you we are still likely to be a long way from 1993 when divorce hit 165,000. Significantly ‘Living on My Own’ by Freddie Mercury was Top of the Pops.

LEGAL COMMENT OF THE WEEK

TOPIC: The publication of the Government’s proposals to cap legal costs in low-value clinical negligence claims.

COMMENT BY: Qamar Anwar, Managing Director, First4Lawyers

 “This all has a very familiar ring to it, mirroring what has already happened in personal injury for so called ‘lower-value claims’, where, despite the best efforts of the government, claimants have shown they still need legal help but are severely limited by the number of law firms able to help them.

 “It is true that legal costs have risen in recent years. However, this is only in line with the overall increase in all costs associated with medical negligence claims. Furthermore, NHS Resolution’s accounts for the year 2020/2021 show, in fact, that while its own legal costs went up, those of the claimants came down.

 “The government should focus on finding out what is causing negligence in the first place rather than attacking the system that supports innocent victims when things go wrong.”

TOPIC: The case of Smith v Pimlico Plumberswhere the court has decided that unpaid annual leave (where the employer refuses to pay for it) does not count as statutory holiday under retained EU law.

COMMENT BY:  Stephen Ratcliffe, Employment Partner at Baker McKenzie

 “This is potentially really significant for employers whose staff receive any kind of variable pay, or who engage people on a self-employed basis.  Those who pay variable pay face the risk of legacy claims for underpayment of holiday pay when employment ends, even if it is some time since the employee last took their holiday. 

 “For those who engage people on a self-employed basis, the risk of claims that the individual was actually a worker or an employee is compounded by the risk of similar legacy claims for holiday pay.  Perhaps most significantly, the Government enacted a two-year backstop on these kinds of holiday pay claims, because of concerns over the potential multi-billion pound bills which employers might otherwise face for many years of holiday pay.  This decision opens up scope for a future case to challenge whether that backstop is lawful. 

 “With the combination of this case and the proposed focus of the Government’s Single Enforcement Body on holiday pay compliance, employers really need to focus on how they calculate holiday pay now, or else face what may be enormous holiday pay liabilities going back very many years.”

TOPIC: The significance of Co-op shop floor workers having won a key legal argument in a pay tribunal to secure equal pay with warehouse staff

Comment by: Nathaniel Barber, Associate at Keller Lenkner UK.

“This recent development further demonstrates the strong grounds for store workers’ equal pay claims against Supermarkets.

The move from Co-op to concede this issue follows on from the Supreme Court’s decision supporting workers in the claim against Asda, and the European Court of Justice’s judgment against Tesco. Surely all Supermarkets must now recognise that they are on the wrong side of this issue.

It is about time the Supermarkets pay their store workers, who have been on the frontline of feeding the nation during this Pandemic, equally to their distribution centre colleagues.“

TOPIC: The decision by the the UK government to drop its requirement that all NHS England staff are double vaccinated against Covid-19 by the beginning of April,

Comment by: David Greenhalgh, employment lawyer and partner at Excello Law

 “It appears that when the vaccine policy was first announced, the NHS weighed up the legal risk of employment-related claims which might follow if it were to introduce its threatened policy of ‘no jab, no job’ – including possible discrimination claims – but concluded that those risks were fairly low and worth taking to maximise the uptake of the jabs amongst its staff. Part of the thinking behind this was presumably that these measures would reduce the number of Covid-related absences in the NHS.

“The level of employment-related legal risk has not really changed. But what has changed is the risk to the NHS of losing a reported high number of staff members it will be unable to replace due to the ongoing national shortage of nursing staff, caused in part by Brexit.  

“It may well be that the plan all along was to threaten to implement a ‘no jab, no job’ policy and to review how well that threat worked in terms of vaccine take-up amongst staff before making a final call on pressing the nuclear button that would lead to dismissals – and inevitably, claims.”

TOPIC: The appeal to the Supreme Court brought by ‘The Project for the Registration of Children’ – against the Home Secretary –regarding the legality of making the exercise of a child’s right to be registered as a British citizen conditional on the payment of £1,012.

Comment by: Nisha Pradip Patel, Senior Associate at Russell-Cooke

“It is disproportionate and a breach of the individual child’s right to respect for their private life in the UK, as enshrined in the Human Rights Act 1998, that they cannot be registered as a British citizen unless they can afford the Home Office’s fees to benefit from a right that they are entitled to in the UK.”

CONTRIBUTED ARTICLES OF THE WEEK

Developments in Litigation Funding: What happens next? by Kate Gee

The third party funding market continues to grow and become more sophisticated to meet parties’ requirements. Globally, the sector now has a market value of over US $13 billion. However, such remarkable growth rarely comes without attention from the regulators.

At present in England & Wales, the third party funder market is dominated by members of the Association of Litigation Funders (ALF), which is the independent body charged by the Ministry of Justice with delivering self-regulation of litigation funding in this jurisdiction. At present, this consists of ALF, the Code of Conduct for Litigation Funders, its supervision by the ALF and, as funded matters come before the courts, judicial consideration. However, what might developments in Europe mean for third party funding regulation here?

In June 2021, the European Parliament’s Committee on Legal Affairs issued its draft report on litigation funding, and described it as a “rapidly expanding commercial practice in the Union, which has a significant impact on justice systems as well as on European citizens”. The draft report recommends that, “to ensure that justice systems prioritise redress for victims of injustice … a regulatory regime addressing key issues relevant to litigation funding, including transparency, fairness, and proportionality, is necessary”.

A study on responsible private funding of litigation by the European Added Value Unit accompanied the draft report. This noted that litigation funding offers “benefits if the associated risks are mitigated. In particular, it may represent a tool to support private citizens and businesses in accessing justice and constitute a mechanism for transferring the risk of the uncertain outcome of the dispute to the litigation funder. At the same time, it may pose risks and entail conflicts of interests. If not properly regulated, it could lead to excessive economic costs and to the multiplication of opportunity claims”.

While the EU’s Consumer Redress Directive already sets out certain safeguards as regards litigation funding, these are limited to representative actions for consumers. The draft report proposes wider regulation, addressing (inter alia) transparency, fairness and proportionality. One recommendation is for “the establishment of a system of authorisation for litigation funders, permitting the introduction of corporate governance requirements and supervisory powers to protect claimants”.

All in all, any regulatory developments of this nature seem unlikely to dampen the appetite for securing litigation funding on a suitable case. The leading funders already operate to very high ethical and commercial standards, and increased regulation and transparency – when combined with supportive legal precedents – is likely to generate more market confidence. At the same time, the products and funding on offer will continue to grow with innovation being driven by increasing sophistication of funders and greater knowledge of the market by both law firms and their clients.

Kate Gee is Counsel at Signature Litigation

The legal services sector needs to work towards being more inclusive and embrace the different areas of the industry argues Amanda Hamilton

So many changes have impacted our sector over the last 30 years, to the point that it’s barely reconcilable with what it used to be!

For decades, there’s been speculation regarding Barristers and Solicitors and the uniting of the two professions. Of course, we all know that will never come to pass as there are interests to be protected and, with the massive amount of regulation now, it’s simply not achievable. Also, the two professions necessitate very different skills, which is why it used to be that law graduates would almost certainly know which was the right route for them on graduating.

Meanwhile, the changes I speak of have come from within the legal profession; including franchising professional qualifications and the virtual annihilation of legal aid and, frankly, we’re not doing ourselves any favours!

Specifically, the increase in the number of education establishments in a position to offer the professional qualifications has detrimentally affected graduates believing their career will be smooth sailing once they attain their PLC or LLB – because it is no more! There are simply not enough pupillages or training contracts to cater for all the new graduates coming through the system.

Enter Paralegals, who are rapidly becoming the fastest-growing professionals in the legal service sector. Their position in the sector and the work they do throws a lifeline to graduates who may otherwise have been unable to practice law in one of the two conventional professions. Moreover, paralegals are absorbing the impact left by the void in legal aid availability and offering consumers a less costly option when it comes to legal support!

But the rest of the sector seems disinclined to recognise these professionals! Or could there be an element of fear?

So, here’s my plea: Traditional lawyers, please know that paralegals don’t intend to undermine you or your services any more than they want to monopolise or stage a coup of the sector. They simply wish to complement it!

Let’s work together in a spirit of co-operation and understanding if not for our own benefit, then for the benefit of all consumers of legal services.

Amanda Hamilton is Chief Executive of the National Association of Licensed Paralegals (NALP)

Spotting ‘advice issues’ in commoditised drafting jobs – Lessons from the De La Rue pensions case by Anna Rogers

On 17 January the High Court issued a ruling in the case of the De La Rue Pension Scheme which has helped to clarify the rules which apply to a defined benefit pension scheme.

The Court decided that scheme members were not entitled to an ‘underpin’ which would have increased the Scheme’s total liabilities by an estimated £20 million.  Some pension schemes have such an underpin but in this case the rules were unclear.  In effect, the employer was given the benefit of the doubt.

The Judge said “As is often the case in disputes of this sort, the language of the offending rule is obscure and poorly expressed.”  After extensive legal arguments on a single issue, with input from two law firms and four Counsel, he decided on an interpretation.  Simples!

Pity the poor draftsman (or woman).  A new trust deed and rules was often a job done on a tight budget.  Instructions were given by the pensions manager with the goal of simply tweaking the rules to reflect known changes to the benefit structure.  These jobs tended to be given to junior lawyers, armed with the scheme’s existing rules and the firm’s precedent, and the mandate from both client and boss “don’t clock up too much time!” 

Yes, the drafting would have been supervised.  But with hindsight, the cases show that sometimes issues that needed legal advice went unnoticed.  The lawyers wouldn’t know there was a mismatch with what the administrators were doing in practice.     

Pension schemes were always a bit complicated, but a statutory overlay wrecked the original logical benefit structure in three areas: revaluation, sex equalisation and pension increases.  The overlays were overriding so didn’t have to be documented in rules.  Result: an advice gap. 

Pension schemes that had legal advisers (and many still don’t) took advice, but the implications weren’t fully understood for years because the law continued to change.  The protections in all three areas have been scaled back. 

Similar issues must arise outside pensions.  As a profession we have become more business-like about scoping work but the case is another reminder – look out for embedded issues that may need advice, and work on explicit assumptions if your clients don’t seek it.

Anna Rogers is a Senior Partner, Arc Pensions Law

APPOINTMENTS OF THE WEEK

Clifford Chance has appointed Pablo Serrano de Haro Martínez as the new global leader of its Tax, Pensions, Employment & Incentives (TPE) practice. Martinez joined the Madrid office of Clifford Chance in 2001 and became a partner in 2011. He has more than 25 years of experience advising the leading financial investors on the structuring of their investments and incorporation of funds. He will serve a four-year term from 7 February 2022, taking over from Chris Davies who will continue as leader of the Tax team in the UK.

“I am delighted to take on this role leading our Global TPE group, a market leader with a deep bench of talent across the network,” says Martinez. “Our TPE expertise is a vital part of the service Clifford Chance offers, regularly advising on board-level issues for our clients. As we continue to invest and grow, I look forward to working with my colleagues across TPE and the wider firm to advise the leading businesses on their most exciting opportunities and their most pressing risks.”

In addition to his client work, Martinez sits on Clifford Chance’s Responsible Business Board.

McAlister Family Law has appointed Lisa Brown as partner in its divorce and finance team following its most successful year to date. Brown was previously at Maguire Family Law, where she was also a partner acting for clients on a wide variety of issues including divorce, private children matters and financial matters.

Brown’s primary focus at McAlister Family Law will be to act on behalf of clients seeking advice and guidance in relation to divorce and finance, predominantly the more complex, high net worth cases. 

“I am so excited to be joining such a highly regarded and well-established firm with traditional core values but with a modern and dynamic business structure.,” said Brown. “I hope to help the Group continue its success and further support McAlister Family Law in its tremendous growth across the North-West and beyond.“

McAlister Family Law has climbed the rankings in both Legal 500 and Chambers and Partners year on year and, most recently, was recognised by The Times as one of the top 200 best law firms across England and Wales.

Suki Chhokar has joined Axiom DWFM as a Partner in the Birmingham office where he will head up the company’s newly-formed Public and International Health team. He joins fromIrwin Mitchell where he led the International Personal Injury Department primarily dealing with group actions against UK-based tour operators (and sometimes leading to multi-million pound settlements), or single party actions against defendants in foreign countries.

“I am delighted to join such an ambitious and innovative law firm as Axiom DWFM,” said Chhokar. I look forward to using my extensive experience to lead the drive in the freshly-created Public and International Health section.”

Axiom DWFM Partner Shyam Mistry added, “I look forward to working closely with Suki who brings a wealth of knowledge and expertise to our Personal Injury team. Undoubtedly, his credentials speak for themselves and I can only see great things on the horizon.”

E–VENTS

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