Judging the judges – identifying the stand-outs among the judiciary

The good, the bad and the ugly – we asked litigators to identify the judges that – for better or worse – stand out among the judiciary

The 2016 Legal Business judicial survey was not just focused on the overall strengths and weaknesses of the judiciary, it also asked respondents for their views on individual judges they have appeared before. There were some obvious favourites, and one outright villain (no prizes for guessing), and somewhere in between were several judges who impressed and disappointed in equal measure.

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Rack and ruin – the 2016 judicial survey

Funding cuts are putting the judiciary’s status as a world leader under pressure. Canvassing the profession, we find deep concern over prospects for the English courts

Who wants to be a High Court judge? Fewer than ever it seems. This, unsurprisingly, is a major concern for the UK’s top litigators.

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Herbert Smith Freehills: Are UK disputes heading for the Brexit?

Alan Watts

Partner, Herbert Smith Freehills

alan.watts@hsf.com

Well, we are where we are. ‘Brexit means Brexit’. The legal profession, in the very near term, stands to benefit. Clients, whether internal or external, will need comprehensive advice on how Brexit may affect their operations. From due diligence reviews aimed at uncovering Brexit sensitivities, to help formulating arguments for lobbying purposes and devising alternative structures, business for advisory and compliance practitioners will be increasingly brisk. Clients conducting Brexit due diligence may also require assistance in reviewing existing contracts for any terms that may be affected by Brexit, and seeking to agree amendments before a dispute arises. Courts may start to see an influx of litigation as parties seek to clarify the impact of Brexit on their contractual obligations, though it may be some time before Brexit-related litigation really gets going. Lawyers will be among the most influential advisers to government over the withdrawal from the EU and the policy agenda going forward. Our profession will have a real opportunity to influence and shape the legal landscape and future reciprocal arrangements not only in post-Brexit Britain but in other member states of the EU and further afield.

But what will Brexit mean for lawyers, and disputes practitioners specifically, over the longer term?

Pessimists are well catered for. A report commissioned by the Law Society, published prior to the referendum, predicted gloom for the legal sector in the event of Brexit. It found that even in the best-case scenario the sector would suffer losses to output and employment, and in the worst case could see a £1.7bn fall in annual output. It also found that the most negative effects on the legal services sector would be due to the sector’s reliance on intermediate demand from sectors that are likely to be adversely affected by Brexit, particularly the financial services sector and other professional services, and from the subsequent lower levels of business investment.

While that environment may adversely affect some UK-facing transactional activity in the short term, countervailing factors such as currency fluctuations may, however, have a rebalancing effect to some degree. And although, of course, in time there is the possibility of some clients seeing the need to relocate parts of their operations outside of the UK altogether, the overwhelming attitude remains one of wait and see, at least for the time being.

Firms operating within the UK seem less able to adjust to the effects of Brexit than those with an international network.

That there will be challenges for our industry to overcome is inevitable. It does seem likely that the effect on clients will be among the chief driving factors of the health of the legal sector and should clients relocate their businesses to Ireland or the continent, they will take with them some demand for legal services from the UK. Companies taking a wait-and-see approach may avoid big-ticket transactions or taking risks in the UK. In-house legal budgets and resources may be diverted away from litigation and toward tackling the business-wide implications of Brexit. Firms operating largely within the UK seem likely to be less able to adjust to the effects of Brexit than those with an international network. Any removal of freedom of movement will hinder the ability to move lawyers freely around a firm to meet business demands.

Further, there will be those who seek to suggest that a choice of English jurisdiction is no longer wise because of the risks that the recast Brussels Regulation will no longer apply between the UK and EU countries. None of this will be lost on London’s competitors in elite international dispute resolution, and we can expect the likes of Dubai, Singapore and New York to try to take advantage of any uncertainty around such issues and Brexit more generally and position themselves as a safer choice for sophisticated disputes.

Nevertheless, there is cause for optimism. The core principles of English contract law, such as interpretation of contracts and remedies for breach, remain unaffected by Brexit. The respect of English law for parties’ freedom of contract will make it a perennial favourite for commercial entities, and perhaps more so in light of the flexibility parties may choose to build into their agreements due to Brexit. The integrity and specialised expertise of the judiciary is unchanged, and parties will continue to enjoy access to high-quality legal advisers, litigation support services and first-class facilities. There is much to recommend London as a centre for dispute resolution and there are alternatives to the Brussels Regulation as discussed below. Statistics repeatedly show that London is an entrenched choice of parties for both arbitration and litigation. We in the profession have an important role in ensuring it remains so.

As disputes lawyers we can educate our clients and colleagues about the potential impact of Brexit upon dispute resolution in London. Parties should also be mindful of the dispute resolution clauses they wish to include in contracts should they be seeking enforcement in an EU member state. Although it is not clear at this stage what arrangements will replace the current regime, it seems inevitable that some arrangements will be put in place to safeguard mutual enforcement for the benefit of the UK and the remaining EU member states, particularly as enforcement is a two-way street. Nonetheless, where it may be necessary to enforce in an EU member state and there is any uncertainty as to that member state’s approach in the absence of specific arrangements, parties may wish to consider alternative arrangements, such as arbitration in London. Enforcement of an arbitral award will be governed by the familiar and well-established New York convention, upon which Brexit will have no impact. Disputes lawyers can also ensure clients are aware of the benefits of litigating in London, and keep the risks regarding the enforceability of judgments in perspective. Ultimately it is a question of balancing what are likely to be modest risks against the benefits of English law and London as a premier centre of excellence for dispute resolution.

We in the profession also have an important role to play as advocates of the English legal system. Industry regulators and professional bodies should work together to ensure that in the negotiations around Brexit the position and importance of the legal sector is not forgotten, not only because of the contribution the sector makes to the economy in its own right but because of the supporting role it plays to businesses and commercial parties across all sectors (and in particular financial services).

Of immediate concern should be a sensible solution to the issue of enforcement so as to preserve England’s attractiveness as a jurisdiction and competitive advantage as a dispute resolution centre. The UK could, for example, negotiate to join the Lugano Convention 2007. This applies currently to Norway, Switzerland and Iceland, and includes broadly the same terms as the Brussels I Regulation. While this would mean that parties would be unable to benefit from certain improvements introduced by the recast Brussels Regulation, it would nevertheless provide commercial certainty for parties and lawyers under a familiar regime. Failing this, the UK could seek to join the Hague Convention on Choice of Court Agreements, a multilateral treaty which currently applies only to the EU, Mexico, and soon, Singapore. This applies only to those disputes subject to an exclusive jurisdiction clause, so is necessarily restrictive.

While Brexit may offer opportunities for disputes lawyers in the short term, its longer-term effects are more unpredictable. While issues over enforcement, etc, will no doubt be dealt with in negotiations, the uncertainty that Brexit brings with it and the extended period over which that uncertainty will last could present real challenges. Businesses may not only be less willing to invest in litigation but also less willing to invest and do deals in the UK while that uncertainty remains. The fewer domestic transactions that are done today means the fewer UK-focused disputes there are likely to be in the future. It is therefore important that we and our transactional colleagues continue to advocate the advantages of English law and the English courts in international transactions.

Alan Watts is experienced in all forms of dispute resolution, including High Court litigation, arbitration and mediation proceedings. He was appointed in December 2015 as the firm’s new head of commercial litigation in London.

 

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Commercial Dispute Resolution Survey: Fighting strong

As Legal Business publishes its third annual Disputes Yearbook, and the second annual survey sponsored by Cornerstone Research, we scope the views of in-house counsel and private practitioners to shine a light on trends within the international disputes market

Results from the annual trends report from Cornerstone Research indicate firstly that the appetite for large-scale commercial litigation has yet to abate in London and, furthermore, that London’s lawyers continue to be lauded as the dominant players of international disputes.

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Going long: a ten-year view of the LB100

While headline figures for revenue, profit and headcount in this year’s LB100 confirm another year of subdued trading, a look at how the top 100 UK-based firms by revenue have performed overall since the halcyon, pre-credit crisis days of 2006 makes interesting viewing. Not least as they are testament to the inherent strength of the industry, despite the hurdles it has seemingly faced in ten years. We also look at 2011 as a five-year mid-point, the stage when the global financial crisis had started to ebb. Continue reading “Going long: a ten-year view of the LB100”

Case study: Berwin Leighton Paisner

Had merger talks earlier this year with Miami-based Global 100 firm, Greenberg Traurig, been successful, Berwin Leighton Paisner (BLP) would now be part of a £1.1bn firm and a £5m fall in revenue would look like a drop in the ocean. As it is, BLP’s strategy is under scrutiny again with its recent revival looking short-lived.

Revenue fell 2% at BLP in 2015/16 to £254m, while profit per equity partner (PEP) was more positive with 4% growth to £687,000. This is in sharp contrast to the rapid growth of the previous financial year, when revenue rose 5% to hit a record £259m and PEP surged 22% to £661,000. Continue reading “Case study: Berwin Leighton Paisner”

Case study: Freshfields Bruckhaus Deringer

By some margin the strongest-performing Magic Circle firm for the 2015/16 year, Freshfields Bruckhaus Deringer posted 7% revenue growth from £1.245bn to £1.327bn and an 8% profit per equity partner (PEP) hike to £1.47m from £1.37m.

This performance is particularly impressive after a year of investment. The firm pushed hard on the development of its legal services hub in 2015, gaining the lease to its Manchester office in July last year. Rapidly scaled up, Freshfields’ Manchester staff will move into new premises double the size of the current office from early 2017, accommodating legal services staff as well as human resources, IT, marketing and business development, office management, document specialists and change management. Plans are already underway to open a second legal services hub in either the US or Canada to offer a 24-hour service to clients. Continue reading “Case study: Freshfields Bruckhaus Deringer”

The Legal Business 100 2016

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