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The Times

Friday, October 14 2016

Frances Gibb and Jonathan Ames bring this morning’s must-read of all things legal, including news, comment and gossip.

Today

  • Government accused of ‘unlawful’ Brexit trigger
  • Hogan Lovells is third to cut Shanghai access deal
  • Foreign leaders will be ‘easy hit’ for new wealth orders
  • Personal injury lawyers ‘overjoyed’ at whiplash U-turn
  • Brief Premium sector focus on tax: Cracking down on avoidance
  • Brief Premium comment: Extend fixed costs, says Lord Justice Jackson
  • Brexit countdown: Kiss tariffs goodbye
  • Comment: In praise of a decade of anti-age bias rules
  • Blue Bag diary: Duncan Smith played the advice, not the man

Tweet us @TimesLaw with your views.

 
 
 
Story of the Day

Government accused of ‘unlawful’ Brexit trigger

Theresa May was accused yesterday of seeking to trigger the Brexit process by unlawfully using ancient executive powers under the royal prerogative.

Opening a key constitutional challenge at the High Court in London, Lord Pannick, QC, of Blackstone Chambers, argued that the prime minister had no legal power to trigger Article 50 of the Lisbon treaty to leave the EU without the prior authorisation of parliament.

May announced at the Conservative Party conference this month that she intends to do so by the end of March next year. However, Lord Pannick, a regular columnist for The Times, said that the Referendum Act 2015 was “of no legal or constitutional substance whatsoever – that act was an advisory referendum, no more than that”.

The silk was appearing on behalf of Gina Miller, an investment fund manager and philanthropist living in London who voted Remain in the EU referendum on June 23. She is the lead claimant in a historic legal action with several other applicants, including the so-called People’s Challenge, which has thousands of supporters.

The case is being heard at the Royal Courts of Justice in London by the lord chief justice Lord Thomas, the master of the rolls, Sir Terence Etherton, and Lord Justice Sales. Lord Pannick told the bench in a packed courtroom – with dozens of lawyers and members of the public listening in two overspill courtrooms – that the case “raises an issue of fundamental constitutional importance concerning the limits of the power of the executive”.

The QC argued that May could not use royal prerogative powers to remove rights established by the European Communities Act 1972, which made EU law part of UK law, because it was for parliament to decide on whether the UK should maintain those statutory rights.

Lord Pannick anticipated the government’s argument, which will be run by the attorney-general, Jeremy Wright, QC, by saying that ministers were not justified in using prerogative powers to trigger the exit process. “That is wide of the mark,” Lord Pannick said. “The question before the court is whether the defendant [the government] has powers in the first place, not whether he is justified in using them.”

The hearing will last for two days.

See Brexit countdown below

 
 
News Round Up
Hogan Lovells is third to cut Shanghai access deal

Hogan Lovells has become the first transatlantic law firm to cut an exclusive deal with a local practice in the Shanghai free trade zone, it was announced yesterday.

The firm, which is based in London and Washington DC, has formed an “association” with Fidelity, a local player that was founded in 1989 and now has about 170 lawyers.

Hogan Lovells told The Brief that under the terms of the deal, neither firm can form an association in the free trade zone with another legal practice. The deal includes rules that do not preclude either side from working with other firms in specified cases to cover potential conflict of interests.

A spokeswoman said that the free trade zone office would open with two Fidelity lawyers and two support staff. Hogan Lovells maintains that it is the fourth largest international firm in China; it has 80 lawyers spread equally across offices in Shanghai and Beijing.

Its move into the Shanghai free trade zone comes after Baker & McKenzie, the US-based franchised firm, led the way with a similar move last year in a deal with FenXun Partners, which is based in Beijing.

The first City of London law firm to enter the Shanghai zone was Holman Fenwick Willan, which signed a deal earlier this year with Wintell & Co, a local shipping law firm.

‘Magic circle’ loses out in quality of work survey

Junior solicitors have named the best law firms for training in England and Wales, and none of the elite band of “magic circle” practices made the cut.

A survey from the website Legal Cheek has produced nine firms with top marks for training.

Trainee solicitors and junior lawyers were asked to rank the quality of work they were allocated at their firms using a sliding scale. The worst level was defined as “shouldn’t they be outsourcing this stuff to a robot?”, while the highest grade was “every day is a vigorous yet wonderfully enriching intellectual workout”.

None of the magic circle firms – Allen & Overy, Clifford Chance, Freshfields Bruckhaus Deringer, Linklaters and Slaughter and May – were included in the highest A* grade bracket.

Only two domestic City of London practices made the top tier: Bristows and Trowers & Hamlins. However, the Square Mile offices of two US firms were given top marks: Kirkland & Ellis (which has just emerged as the City’s top payer) and Shearman & Sterling.

Rounding out the list of firms getting top marks were Burges Salmon, Mills & Reeve, Mishcon de Reya, TLT and Osborne Clarke.

Foreign leaders will be ‘easy hit’ for new wealth orders

Foreign autocrats and potentates are likely to be the first to feel the heat of unexplained wealth orders once draft legislation published yesterday in parliament becomes law, expert commentators predicted.

The Criminal Finances Bill had its first reading in parliament yesterday and lawyers said that “overseas politically exposed persons” (PEPs) would fall in its cross hairs after implementation.

The proposed legislation controversially removes the need for reasonable suspicion of involvement in serious criminality for orders to be issued to foreign PEPs, although it is required for everyone else.

“Law enforcement agencies will see this as something of a free hit and regard these cases as the easiest ones to pursue,” predicted Jo Rickards, a partner at Kingsley Napley, a London white collar crime law firm. Lawyers warned that PEPs will effectively face a reversal of the burden of proof, with the person receiving the notice having to prove that the funds have been accrued legitimately.

It was also forecast that wide groups could be caught within the ambit of the legislation. “Under our money laundering regulations,” explained Rickards, “PEP is a widely drawn term and it includes immediate family and known close associates.”She said it “will be interesting to see when the bill is debated whether there will be any amendment to the definition to reduce the number of people classifieds as PEPs, given what a draconian measure an unexplained wealth order is”.

Meanwhile, lawyers also voiced concerns over provisions in the bill that would give the police an extra six months to look at tip offs concerning financial deals, during which time the deal in question must be put on hold.

“The new rules could hugely damaging,” said Barry Vitou, a partner at Pinsent Masons, the City of London law firm. “In many cases, a delay of six months will likely kill a deal entirely. The victims in this will be business and individuals.”

Personal injury lawyers ‘overjoyed’ at whiplash U-turn

Insurers may have been cursing the government for quietly ditching plans to end the right to cash compensation for minor whiplash injuries – but claimant personal injury lawyers were predictably overjoyed.

“We’re delighted with the decision,” said Qamar Anwar, the managing director of First4Lawyers, a claimant referral business. “While it will no doubt be a huge disappointment to the insurance industry, it essentially protects access to justice for those who need it and, at a time when you can claim for a 15-minute train delay, this move makes complete sense.”

The government’s decision – reported yesterday in The Times, is the latest in a series of moves to overturn policies of the previous regime of David Cameron and George Osborne as prime minister and chancellor of the exchequer, respectively.

Equally enthused was the body that represents solicitors in England and Wales, the Law Society. “We’re delighted government has recognised that its proposed changes to personal injury claims would hamper access to justice, particularly for those on lower incomes,” said Catherine Dixon, the organisation’s chief executive.

She maintained that “many personal injury claims, even at lower value, can be complex and can result in a David and Goliath situation where the person bringing the claim is unrepresented”.

Even lawyers acting for the insurance industry seem at least resigned to the outcome. “The decision may ultimately be a wise move,” conceded Ian Davies, a partner at the law firm Kennedys.

“Insurers have many challenges ahead of them in a post-Brexit world. The claimant market has undergone significant consolidation recently. A period of calm, and dare I even suggest an opportunity for both sides to work together to find a mutually acceptable solution to propose to the government, may benefit all sides.”

However, the head of the Association of Personal Injury Lawyers sounded a note of caution. “There is no room for complacency,” Neil Sugarman said. “We will continue to argue that any reforms to the personal injury claims process must be based on independent evidence, rather than insurance industry rhetoric.”

Brexit countdown – legal update as leave approaches

Kiss tariffs goodbye

As the most recent Nobel prize winner did not quite sing at Desert Trip in California last weekend: “It’s a hard, it’s a hard, it’s a hard Brexit gonna fall.”

Indeed, writes Edward Fennell, there’s a good chance that the mercurial Curly Bob has paid little attention to the local difficulty in the EU. But the same cannot be said of Charles Proctor.

The partner at Fladgate, a City of London law firm, is not likely to trouble compilers of rock music and contemporary poetry anthologies, but he reckons he knows a thing or two about Brexit. “It now seems clear that the UK is heading for a hard Brexit,” Proctor said, and he is not just blowing in the wind.

“Whilst the prime minister has expressed her desire for ‘maximum freedom’ for mutual trade and business between the UK and the EU, she also noted that ‘…we will do what independent sovereign countries do. We will decide for ourselves how we control immigration…’ And that seems to make a hard Brexit inevitable.”

That being the case, Proctor has produced his own “radical proposal”. He said: “The UK must ready itself for the bold and unilateral measure of a global free trade declaration. The government could simply announce that, post-Brexit, it will abolish tariffs on all trade with other countries.”

Radical indeed. And Proctor acknowledged that there could be difficulties. “This obviously carries serious risks for revenues, the balance of payments and the competitiveness of the UK economy.

“However, it also has many advantages. The UK could announce this measure unilaterally, without the consent of the EU or anyone else; it would demonstrate the UK’s commitment to free trade and being open for business; it would strengthen this country’s hand in negotiating trade deals; and it would signify an outward-looking UK confident in its own future.”

If there is any suspicion that such an audacious proposal could only be hatched by a maverick Brexiteer, note that Proctor is an experienced banking and finance lawyer, who last year authored the 1,000-page Oxford University Press publication, The Law and Practice of International Banking.

Perhaps the Nobel committee will be interested after all.

MPs, the law and Brexit

In the shorter term on the Brexit horizon, MPs have launched an inquiry into the implications for the justice system of the UK leaving the EU. The House of Commons justice committee, which is chaired by the barrister Robert Neill, is appealing for submissions covering the implications of Brexit on criminal and civil law, as well as on legal services generally.

The deadline for submissions to this inquiry is Friday, November 11.

In Brief

High Court throws out £5m fraud claim against solicitor and legal executive – Legal Futures

Ched Evans judge warns jury they are not expected to 'judge morals' – Sky News

Donald Trump’s Biglaw Firm Threatens To Sue New York Times Over Publication Of Sexual Assault Allegations – Above the Law

 
 
 
 
 
Byline
Comment

In praise of a decade of age discrimination rules Richard Lee

It is a decade since the age discrimination regulations came into force. Landmark cases since have demonstrated a clear need for the legislation and that age discrimination remains a prevalent issue, with some particular examples testing it.

The use of language within job adverts was an early victim of the legislation. Phrases such as “youthful enthusiasm” and “candidates in the first five years of their career” were held to be discriminatory. The combined language, look and location of adverts has since become more sensitive to the need to avoid discrimination but some poor behaviour still prevails.

The legislation protects all ages, not just those at the upper and lower ends of the spectrum. In 2009, a 42-year-old banker successfully brought a case of age discrimination against his employer after he was dismissed and replaced with a 38-year-old. This decision was originally communicated as part of a restructuring exercise. However, the tribunal found that the company had appointed head-hunters “seeking [a] younger, more entrepreneurial profile”.

Despite this, there is often an assumption that younger individuals remain unaware of certain employment rights. In 2010, a tribunal in Northern Ireland described the dismissal of a worker before her 18th birthday to avoid paying the increased minimum wage as “a most upsetting turn of events for a young person beginning her working life”.

Employers should not simply assume that perceived ignorance of young workers’ rights will justify this type of conduct. Employers should always make fair and appropriate treatment a priority over saving costs, which on its own cannot justify discriminatory treatment.

Vague age and diversity policies can also lead to less obvious discriminatory behaviour being permitted. For example, workplace banter or name calling is often thought to be inoffensive. However, in the 2016 case of Dove v Brown & Newirth, a man, 51, was awarded £63,000 in damages for both age discrimination and injury to feelings after he was dismissed for alleged poor performance.

As well as enduring reviews that unfairly criticised his performance, Dove had to suffer the use of the term “gramps” by colleagues when speaking to, or describing, him. Although seemingly light-hearted, it had been sustained for a number of years leading to a ruling that age discrimination had taken place.

The recently introduced national living wage again raised the issue of age thresholds. An increase for those older than 25 meant the potential existed for younger employees to bring age discrimination claims. Employers are protected from this by the statutory pay band system which means that this is lawful as long as the hourly rate matches the appropriate statutory band.

The 2006 Age Discrimination Regulations were an important milestone for the UK workforce and not only because they challenged unfair behaviour. The regulations provided the basis for developing the law to include stronger legal provisions through the outcomes of a wide range of cases over the last decade and the abolition of compulsory retirement has also entirely changed the nature of later working lives.

Richard Lee is a partner at Gowling WLG, a transatlantic law firm

 
 
Tweet of the Day

The people voted to leave. We can merely inform the EU of our intention to leave. Art 50 causes the EU to derecognise us @BarbaraHewson

Jamie Foster @1jamiefoster

 
 
Blue Bag

Duncan Smith played the advice, not the man

For all those worried that Brexit heralded the return to Punch and Judy politics, The Brief is delighted to report that Iain Duncan Smith and Sir Keir Starmer, QC, are playing nicely again.

A few days ago, IDS, the former leader of the Conservative Party and arch-Brexiteer, lambasted the Labour man with the shadow portfolio for bailing out of the EU as “a second rate lawyer”.

Duncan Smith had been less than impressed by Starmer’s assessment of the legal and constitutional position over whether Article 50 of the Lisbon treaty can be triggered by royal prerogative or whether a vote of parliament was required.

Now it appears that Tory whips have had a word in his shell-like to say that the former director of public prosecutions and Doughty Street Chambers silk is actually a pretty dab hand at the law. Indeed, as second rate lawyers go, there are plenty in the queue ahead of him.

Duncan Smith duly rose in the Commons on Wednesday to withdraw “unreservedly” his earlier allegation. He went on to suggest that he was referring to the advice that Starmer was informally offering parliament rather than to the abilities of the individual.

Whether the two will be going on a day trip to Brussels together any time soon remains debatable.

Music to charities’ ears

Lawyers generally don’t have to be asked twice to do anything but the law, even if only for an evening.

The latest excuse to ditch the time sheets for a while is the Legal Harmony Clash of the Choirs, which reaches a climax on October 19.

Lining up to do battle in aid of various charities at Southwark Cathedral on the south side of London Bridge are several law firm teams. The only one of the City’s five-strong cadre of “magic circle” firms to loosen their vocal chords is Linklaters, with its team singing for the Tom ap Rhys Pryce Memorial trust.

The other law firms are Berwin Leighton Paisner, singing for the Anthony Nolan charity, Taylor Wessing for Wide Horizons, Stevens & Bolton for the Phyllis Tuckwell hospice and Olswang for Alzheimer’s Research UK.

An interesting side note is that this could mark one of the last times that the legal world sees the independent Olswang name before it is swallowed by CMS as part of a recently announced tripartite merger with Nabarro. If the rumours emerging from the firm’s Holborn HQ are remotely accurate, there are plenty of partners who reckon they have not got much to sing about.

 
 
Closing Statement

Stoned at the mags

Justice could be rough, particularly for unrepresented defendants in magistrates’ courts in the 1960s, recalls James Morton, when training for their worships was not of the standard it is today.

At a hearing in Tottenham in north London, I watched a man – who, in those less understanding days would have been called a “nutter” – defend himself on a charge of possessing an offensive weapon. He began by apologising for his appearance – no complaints, he assured the bench, but he had been in a cell all night. He had a good breakfast, he added, before starting to ramble about how he collected and polished stones and the one he was carrying was his favourite.

The chairman interrupted him: “Stop Smith, you have said enough to clear yourself.” He paused and added: “We find you guilty.”

On the bright side, my recollection is that the man got his stone back.

James Morton is a former criminal law solicitor turned author