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The Times

Friday, May 19 2017

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

Today

  • Tories plan to abolish Serious Fraud Office
  • Newspapers to be spared punitive libel costs
  • More manifesto: public advocate for disaster cases
  • Couple spent ‘astonishing’ £2.5m on divorce lawyers
  • Insurers ‘have under-compensated victims for years
  • City lawyer pays cousin £130,000 in inheritance row
  • Chamber of commerce enters crowded arbitration field
  • Comment: Stop treating injury victims as second class citizens
  • Blue Bag diary: Truss surfaces in Walsall

Plus, see our plans for Brief Premium and archive of articles so far. Tweet us @TimesLaw with your views.

 
Story of the Day

Tories plan to abolish Serious Fraud Office

The Serious Fraud Office (SFO) would be abolished and its work taken over by the National Crime Agency under plans in the Conservative manifesto published yesterday.

Theresa May has long wished to dismantle the SFO as a separate entity but her efforts in 2011 to push forward the measure as Home Secretary were thwarted by Cabinet colleagues, including the law officers. Concerns were raised that splitting the investigators and the prosecutors – who unusually work together at the SFO – would weaken the agency’s powers.

However, the Conservatives’ manifesto says: “We will strengthen Britain’s response to white collar crime by incorporating the Serious Fraud Office into the National Crime Agency, improving intelligence sharing and bolstering the investigation of serious fraud, money laundering and financial crime.”

This could mean that investigators move in with the NCA and prosecutors are taken under the wing of the Crown Prosecution Service.

The proposals were immediately criticised by lawyers specialising in fraud and white-collar crime. Stephen Parkinson, head of criminal law at Kingsley Napley, said: “This is a dreadful decision. The NCA does not have the capability or the expertise to investigate complex, serious fraud, nor, I suspect, the desire. This is a real step back from the UK’s commitment to tackle serious economic crime.

“This will lead to organisational paralysis. The SFO will be reluctant to take on any new cases now, and the NCA will take months if not years to get into their stride. Expertise will be lost and never recovered since SFO staff will now leave in droves. Few will want to transfer to the NCA.”

Jonathan Fisher, QC, of Bright Line Law, a London and Manchester firm, said: “This sends out the wrong message about the UK’s resolve to tackle serious fraud and corruption. Instead of dismantling the prosecuting authority which has statutory responsibility for this task, the Government should be increasing the SFO's budget and expanding its enforcement remit. This manifesto commitment is counterintuitive.”

David Kirk, a partner with McGuireWoods who was chief criminal counsel at the Financial Conduct Authority and before that head of a fraud unit at the Crown Prosecution Service, said: “It is difficult to understand how closing down the SFO will improve the fight against fraud. Squeezing it into the NCA, and removing its important joint investigating and prosecuting model, can only reduce its effectiveness, with a consequent adverse impact on reducing the damage caused to society and individuals by economic crime.”

Jeremy Summers, head of business crime at Osborne Clarke, said: “At a time when the SFO is establishing a track record of success this can only be seen as a retrograde step. The investigation and prosecution of serious fraud requires significant expertise, and it is less than clear that the NCA will have that capability.”

 
 
What lawyers want from a new government ... a new lord chancellor, restored legal aid eligibility and the scrapping of tribunal fees. Frances Gibb and Jonathan Ames provide a preview edition of the Brief Premium podcast
 
 
News Round Up
Newspapers to be spared punitive libel costs

Newspapers will be spared the “crippling” legal costs they feared would have a “chilling” effect on freedom of expression under election pledges made by the Conservatives.

The party’s manifesto says that it will repeal a measure that would have forced newspapers that did not sign up to an approved regulator to pay their opponents’ costs in libel and privacy cases, even if they won the case.

The Conservatives have also pledged to ditch the second part of the Leveson inquiry into the culture, practices and ethics of the press, and to keep Channel 4 in public ownership but to relocate it out of London.

Newspapers had widely condemned section 40 of the Crime and Courts Act 2014, which is on the statute book but not yet enacted, because of the punitive deterrent costs that it would inflict. However, the manifesto published yesterday pledges to repeal the section, accepting that “if enacted, [it] would force media organisations to become members of a flawed regulatory system or risk having to pay the legal costs of both sides in libel and privacy cases, even if they win”.

The Society of Editors “wholeheartedly” welcomed the commitment not to bring the section into force, saying that many newspapers had made clear such costs orders would have a “seriously chilling effect” on their work. It said: “To put it simply, they would be less inclined to pursue investigations in the public interest when the risk of crippling legal costs would be increased.”

Independent public advocate for disaster cases proposed

An independent public advocate will be created by the Conservatives if they win the election to act for bereaved families after disasters and support them at inquests, the party announced in its manifesto.

Theresa May’s party will also impose a system of specialist training for publicly-funded advocates acting in cases involving allegations of serious sexual offences. The move will be designed to ensure that alleged victims and witness in those cases are handled sensitively. The Tory manifesto said the plans for a public advocate came out of the gruelling experiences of the families of the victims of the Hillsborough stadium disaster in 1989.

“To ensure that the pain and suffering of the Hillsborough families over the last 20 years is not repeated,” the manifesto says, “we will introduce an independent public advocate, who will act for bereaved families after a public disaster and support them public inquests.”

In other areas around the law, the party committed to extending the scope of the unduly lenient sentence scheme “so a wider range of sentences can be challenged”.

The Tories would also “push forward” with plans to crack down on hate crimes committed on the basis of religion, disability, sexual orientation or transgender identity.

Couple spent ‘astonishing’ £2.5m on divorce lawyers

A multimillionaire businessman and his wife involved in a £50 million divorce dispute have been criticised by a judge for spending more than £2.5 million on lawyers.

Lord Justice Moylan said that Christakis Christoforou’s evidence on “contentious issues” had been “largely based on an indifference to the truth”. The judge criticised Mr Christoforou, 66, who set up a property business in the mid-1980s, in a ruling published after earlier hearings in the family division of the High Court in London.

He said that he had been asked to rule on the division of a £50 million fortune after the breakdown of Christoforou’s 34-year marriage to Ibtissam Ali Christoforou, 63. Lord Justice Moylan said he had made decisions on a number of issues but had yet to make a final order.

He said that Mrs Christoforou’s evidence had been “largely reliable”. While she had “undoubtedly acted tactically since the marriage broke down, including by not always giving an accurate presentation . . . I found her generally to be an honest witness”.

But it was the costs that particularly attracted the judge’s attention. He said Mrs Christoforou had spent £1.4 million on lawyers and Mr Christoforou £1.3 million. The judge commented: “Despite some of the complexities of this case, to have spent a total of £2.7 million is an astonishing sum which is wholly disproportionate to the issues.”

Insurers ‘have under-compensated victims for years’

Insurance companies have “spent years under-compensating” injury victims while they should have been preparing for reform, a leading claimant lawyer said yesterday.

Brett Dixon, the new president of the Association of Personal Injury Lawyers, accused insurers of being “hysterical” in their response to the government’s recent decision to update the formula for calculating compensation for life-changing injuries. “While insurers should have been preparing for the reform which they knew was coming, many of them were resting on their laurels, reaping the benefits of a rate which was too low, while people with life-changing injuries were under-compensated,” Dixon told the association’s meeting in Cardiff.

“Were there any stories about insurers going out of business because they could no longer make ends meet? Of course not,” said Dixon. “Was the idea that injured people are somehow responsible for the setting of premiums accepted by some opinion formers? Of course it was.”

Dixon, a lawyer with Smith Jones Solicitors in Burnley and Kenilworth, went on to call for “fairness, accountability and the need to treat injured people with dignity”. He said: “A society will be judged on the basis of how it treats its weakest members. So we had all better sit up, take notice and try to be better, fairer human beings.”

See comment below

City lawyer pays cousin £130,000 in inheritance row

A City of London lawyer has paid her window cleaner cousin £130,000 to stop him from suing her for allegedly depriving him of his inheritance.

Jannan Crozier, a partner at the London office of one of the world’s biggest law firms, Baker McKenzie, agreed an out of court settlement with her cousin, Tommy Crozier, to settle a long-running family dispute.

Tommy Crozier, who is 43, alleged that his 37-year-old solicitor cousin – who specialises in mergers and acquisitions deals for exclusive hotels and resorts – failed to pay back a loan his father had made to her to buy a flat in London.

Thomas Crozier, Tommy’s father and Jannan’s uncle, is understood to have earned a small fortune in the 1980s from his business selling hotdogs and burgers outside the Old Trafford and Maine Road football grounds in Manchester. Tommy Crozier alleged that his father loaned the lawyer, who joined the leading law firm in 2005 after reading law at Manchester University and the College of Law in Chester, more than £100,000 to buy a flat in Canary Wharf.

According to court documents, Tommy Crozier claimed that the understanding was that his cousin would pay back the loan in monthly instalments of £1,000. But when his father died intestate in 2010, Tommy Crozier said that he discovered that his cousin had cancelled the standing order, leaving the bulk of the alleged loan unpaid.

In a witnesses statement, Jannan Crozier claimed that the money was a gift and not a loan. However, she acknowledged that she did borrow an additional £13,000 to cover stamp duty, land tax and legal fees.

According to a report on the legal community website RollonFriday, the Baker McKenzie lawyer agreed in February to pay her cousin £130,000 to settle the claim and avoid a court battle. Details of the settlement have just emerged. And it was also claimed that a restraining order had been placed on Tommy Crozier after he allegedly harassed his cousin, the website said. Neither Jannan Crozier nor Baker McKenzie would comment.

However, Richard Harrison of the law firm Laytons, which acted for Jannan Crozier, said: “This is a long-running family dispute with a history of serious harassment of Ms Crozier, which culminated in a restraining order being made against Thomas Crozier, which is still in place. In that context, Ms Crozier defended this case vigorously and stands by her defence.

"Ms Crozier was committed to taking the matter to trial but made a part 36 offer [to settle before trial] in order to protect herself against costs that were likely to be irrecoverable and which the claimant chose to accept rather than go to trial.”

London chamber of commerce enters crowded arbitration field

A London business group has become the latest to launch an arbitration service as the UK capital continues to battle to retain its leading position as a venue for alternative dispute resolution.

On Thursday the London Chamber of Commerce and Industry announced its plan to offer its members and other businesses an in-house service rather than acting as a referrer, which it had done before. The service, called the London Chamber of Arbitration, is billed as providing a range of mediation and alternative dispute resolution services. Organisers said they would announce a panel of arbitrators, which will consist of former members of the judiciary and current senior practitioners, soon.

Colin Stanbridge, the chamber of commerce’s chief executive, said he hoped the venture “will be an attractive facility not only to businesses in London but those throughout the UK and overseas”.

The service enters a highly competitive field, not only within London, where several arbitration centres exist, but also internationally, with competition in Paris, Geneva, Dubai, Singapore and Hong Kong. But Robert Griffiths, QC, head of Mondial Chambers in London, was upbeat at the launch. “The London Chamber of Arbitration will provide a bespoke service to those who do business in and with London and will enhance London’s preeminent status as an arbitration centre,” he predicted.

In Brief

Leigh Day solicitor says 'bribe' reference in email was not meant literally– Law Gazette

Off-shore law firm barred from launching in Bermuda – The Lawyer

Young defendants ‘should not be denied trial by jury’ – Legal Voice

Correction

In The Brief on May 17, 2017, we reported on a Court of Appeal case heard by Lord Justice Irwin, Lady Justice Gloster and Lord Justice Underhill. In that report, we incorrectly referred to James Duffy, QC, when we meant Jim Duffy, a junior barrister at One Crown Office Row.

 
 
 
Byline
Comment

Insurers treat injury victims as second class citizens Brett Dixon

I don’t know exactly when injured people started to be viewed as second class citizens, playing second fiddle to tight wallets and hard hearts.

I don’t know why it is so difficult for people to understand that being injured – being in pain and having your life completely turned upside down – is probably one of the worst things that can happen to anyone.

I’ll never understand why accountability for getting things wrong is perfectly acceptable in all other walks of life but seems to be easily forgotten when someone has been needlessly injured. Or why it’s OK for the state to pick up the tab for dealing with the aftermath of injury instead of the person who has caused it, through his insurance company, which has received premiums for the purposes of doing just that.

It’s often forgotten that these are not people who are the victims of unforeseen and unpreventable mishaps. They have been injured – completely needlessly – through no fault of their own, but through someone else’s negligence.

While fairness is an easy concept to invoke in the abstract, in practice it seems to be difficult for some to apply. Indeed, the minute it means paying compensation to ensure people have a chance to try to restore their lives as best they can, we are constantly reminded that we are in economically difficult times.

Reaction to the change to the discount rate is a case in point. First came the usual lip service from the insurance industry about the importance of catastrophically injured people receiving the right amount of compensation.

So far so fair. But it seems the “right” amount of compensation is only right if it is also “fair” for defendants, insurance companies and premium payers. This should be simple. Right means putting the victims of negligence back, as far as possible, in the position they would have been had the negligence never happened. In my experience they would much rather it had never happened. I’ve lost count of the number of times an injured person has said to me: “I’d rather just be the way I was.”

When Philip Hammond, the chancellor, announced that £6 billion would be set aside for the NHS to be able to cover compensation under the new rate, the response from the insurance industry was predictable and hysterical – the change in rate was “extraordinary”, “absurd”, “crazy”. As if it hadn’t known it was coming. As if the industry hadn’t had years to prepare.

But while insurers should have been preparing for the reform which they knew was coming, many of them were resting on their laurels, reaping the benefits of a rate which was too low, while people with life-changing injuries were under-compensated or had to save their compensation in higher-risk investments.

The obvious point that claims against the NHS are only successful when negligence has been proven by the injured person continues to be ignored. But it is a point we will continue to make in the media and to the government.

Brett Dixon is the new president of the Association of Personal Injury Lawyers and a lawyer at Smith Jones Solicitors in Burnley and Kenilworth; this article is an extract from his speech to APIL’s annual conference yesterday

 
 
Tweet of the Day

First steps of freedom!! 😄 https://t.co/kPPWV5epwa #ChelseaIsFree https://t.co/0R5pXqA1VN

Chelsea Manning @xychelsea

 
 
Blue Bag

Truss surfaces in Walsall

Bar leaders, some newspapers and even the odd fellow cabinet member may be calling for Liz Truss to be sacked, but at least the lord chancellor has some friends in the West Midlands.

Eddie Hughes and James Bird, Conservative party general election candidates in the constituencies of Walsall North and Walsall South, respectively, asked the beleaguered justice secretary to lend a hand with local campaigning.

Truss, whose own constituency in South West Norfolk is miles away, has not had the happiest of stints as lord chancellor. She came under fire for allegedly showing insufficient support for the High Court judges handed down the first Brexit article 50 ruling when they were attacked by segments of the media. She has also been criticised over prison policy and for appearing to have a shaky grip on the state of plans to allow witnesses in rape trials to give evidence by video link.

But all is forgiven in Walsall. Truss told the Express & Star that she and the two local Tory candidates “had a very positive reaction doorstepping around Walsall … This is historically a Labour area, but people are concerned about Jeremy Corbyn and his plans”.

Truss even tackled the thorny issue of the riot at the end of last year at Winson Green prison in Birmingham. An investigation was “a high priority”, she told the newspaper.

Firm helps fans who don’t want to say ‘auf wiedersehen’ to TV pub

Lawyers rarely have a positive public image, so the profession might owe a debt of gratitude to Newcastle solicitors’ firm Muckle, which is providing free advice to a group trying to save a bit of 1980s television history.

The firm has joined campaigners who are trying to save the pub that featured in the second series of ITV sitcom Auf Wiedersehen, Pet. The Windmill Inn in Redmile, Leicestershire, is apparently threatened with the destiny that faces so many older buildings in the modern age – being bulldozed for housing development.

The Windmill is better known to fans of the programme – which was broadcast between 1983 and 1986 – as the Barley Mow, the pub where the seven mostly Geordie builders stayed while renovating Thornley Manor.

The firm has agreed to assist the fans to form a community benefit society, which will issue community shares. Muckle has agreed to provide advice on the structure of the bid by the fans’ consortium, which is trying to raise £500,000 to buy the pub.

“Being a Newcastle law firm we are very aware of the sentiment behind Auf Wiedersehen, Pet; its cult status and enduring popularity around the world,” says John Devine, partner at Muckle. “For fans of the show, the Barley Mow is truly an iconic location, so we are keeping our fingers crossed the consortium’s bid to retain the pub and its place in the community in Redmile will be successful.”

 
 
Quote of the Day

“It is perfectly proper to raise questions about judgments such as these with evidence, and it is perfectly proper to rebut such questions with evidence; but seeking to neutralise arguments on the basis that the law has been followed is not much help, especially where it is not being alleged that the law has not been followed.”